Starbucks announced Monday that it will exit the Russian market, joining such corporate giants as McDonald’s, ExxonMobil and Netflix in pulling out of the country over its invasion of Ukraine.
The coffee giant has 130 shops in Russia, which account for less than 1 percent of its annual revenue, according to CNBC.
The Seattle-based chain had closed those locations, which were run by franchisees, in March after the invasion but left open the possibility of reopening them. But nearly three months later, Starbucks announced Monday it had “made the decision to exit and no longer have a brand presence in the market,” according to an update posted on its website.
Multinational corporations have fled the country in droves as financial and reputational liabilities have stacked up during the war. Nearly 1,000 companies had curtailed operations in Russia as of Monday, according to a widely followed list maintained by Yale University.
Many of them are responding to business imperatives; the rush of sanctions imposed by Western governments has made it impossible for foreign firms to conduct even basic business transactions in the country.
They have also cited the growing humanitarian crisis in Ukraine. The war has displaced 8 million within the country, and more than 6 million refugees have been registered by the U.N. refugee agency, according to data released Monday.
Weeks into the conflict, the U.S. State Department determined that Russian forces had committed war crimes in Ukraine, citing indiscriminate bombings as well as those that deliberately targeted buildings known to contain civilians. A theater filled with civilians in Ukraine’s southeastern city of Mariupol was bombed despite having the Russian word for “children” marked in huge letters that were visible from the sky. On Monday, Ukraine’s prosecutor general, Iryna Venediktova, said her country has opened more than 13,000 investigations into suspected war crimes committed by the Russian government and military.
Former Starbucks chief executive Kevin Johnson, in comments published in early March when the company tentatively moved away from its Russian business, condemned the “unprovoked, unjust and horrific attacks on Ukraine by Russia, and our hearts go out to those affected.”
The company did not disclose any Russia-related charges or write-downs in its quarterly earnings call on May 3, suggesting the loss of its Russian business may not have been material to its finances. Monday’s announcement provided no information on the financial costs of leaving.
While relatively few U.S. companies want to remain in the country, many have found that cutting ties is easier said than done. Some leading tech companies including Google have been limited by a 2021 law that requires them to keep employees in the country.
Other companies have been reluctant to make any move that will put their employees at risk of retaliation. Starbucks, for its part, said it will pay its 2,000 Russian employees for six months and help them find new work outside the company.
Food retailers have had difficulty fully extricating themselves from the country. Many quick-service restaurants, such as KFC and Pizza Hut, are run by franchisees, limiting a corporation’s ability to control local operations.
Last Monday, McDonald’s announced it would exit the county, citing the “untenable” business climate after more than three decades of investment, and look for a local buyer. Within days, the company announced that Siberian franchisee Alexander Govor would take over as many as 850 stores, operate them under a new brand, and retain McDonald’s employees for at least two years.
Other food producers, such as PepsiCo, Nestlé and Mondelez, have cut off sales of lifestyle items such as sodas, snacks and candy but continued the sales of staple goods including dairy products and baby formula. But even those moves have limited effects: Local retailers with certain items already in stock can continue selling them.
(c) 2022, The Washington Post · Jacob Bogage
Starbucks, with Howard Schultz, are big supporters of mishgav zachor. Low grubby evil people.
McDonald’s, Starbucks, etc. have been shutdown globally for corruption.
For what ever reason Jews think Starbucks is kosher! Not at all. All treiff as mac D. I get a kick when I see frums with a Starbucks cup and a sefer etc.
Sounds like you do not care about doing mitzvos for Hashem. Why would you “get a kick” when you see this? You should at least be sad for them that they are making a mistake.
I said, ‘ I give them a kick’. I yell at them as loud as possible. I call them frummer ganoovim and worse. Everyone should follow my example. They won’t go back to Starbucks after that. My message is clear.