Hundreds of companies have announced plans to suspend or halt operations in Russia amid the ongoing war with Ukraine, many of which are well-known Western food companies. Among them include food giants like General Mills, Nestlé and Cargill. But a small number of companies are still doing business in Russia, including Restaurant Brands International (RBI), the owner of Burger King.
Food Companies Cutting Ties with Russia
Grupo Bimbo SAB de CV and Cereal Partners Worldwide (CPW), a joint venture between General Mills, Inc. and Nestlé SA, have suspended operations in Russia following the country’s invasion of Ukraine. Mexico City-based Grupo Bimbo has suspended sales of the Bimbo brand in Russia as well as new capital and marketing investments, the company announced yesterday.
In partnership with Nestlé, CPW has stopped advertising and suspended all capital investment in its business in Russia. CPW sells cereal outside North America with sales in Russia accounting for less than one percent of total General Mills sales. General Mills does not have any wholly owned operations in Russia, nor does it have any plants, employees or distributors in the country.
“We have donated products to food banks and local charities to help those in need in Ukraine and neighboring countries. And we will continue to do so,” Nestlé said in a press release. “Nestlé employees across the world are also stepping up to show their solidarity through a fundraiser in partnership with the International Federation of Red Cross and Red Crescent (IFRC). Their contributions to support the people in Ukraine will be matched by the company.”
Meanwhile, Minneapolis-based meat giant Cargill is scaling back business activities and stopped investing in Russia. It will, however, continue to operate essential food and feed facilities in the country. Late last week, the company said in a press release that the people in Ukraine “are living an unthinkable and horrifying reality,” and while it acknowledged it has “a long history in Russia,” it says “now is a time like no other.”
Other food companies suspending or scaling back operations in Russia include McCormick & Co., The Coca-Cola Company, Kraft Heinz Co. and McCain Foods. At the same time, several fast-food companies have temporarily closed shop, including McDonald’s, Pizza Hut and Starbucks.
Business as Usual
Burger King restaurants remain open for business as usual in Russia. The chain’s owner, RBI, said its 800 Burger King locations in the country remain open because they are stand-alone franchise operations that are independently owned. However, while its Burger King franchises remain open, RBI said it will suspend all corporate support for the Russian market and redirect corporate profits from the franchise operations to help support Ukrainian refugees.
Other restaurant chains, including KFC and Subway, announced similar plans for their Russian operations. They will redirect profits and support humanitarian efforts in Ukraine, but KFC’s approximately 900 franchise locations will stay open as will Subway’s approximately 450 franchise locations.
Regardless of the reason behind it, food companies staying open in Russia causes an ethical problem. Along with economic sanctions, the aim of some businesses pulling out is to convince the Russian people they need to take a stand in the ongoing fight against Russian President Vladimir Putin’s regime.