Due to the invasion of Ukraine, pressure is mounting on Western food and beverage behemoths to exit out of Russia.
On social media, McDonald’s and Coca-Cola have been chastised for failing to condemn the assaults while continuing to operate in the nation.
Netflix and Levi’s, for example, have already ceased selling their products or delivering services in Russia.
On Monday and throughout the weekend, the hashtags #BoycottMcDonalds and #BoycottCocaCola were trending on Twitter.
Deborah Meaden, a Dragon’s Den investor, also came out against Coca-Cola on social media, pushing people to quit drinking it.
Other well-known Western companies, including as KFC, Pepsi, Starbucks, and Burger King, have been criticized for closing their stores and ceasing sales in Russia.
Last year, the fast food company KFC celebrated 1,000 stores in Russia. It stated in 2021 that it planned to open roughly 100 eateries each year.
McDonald’s has 847 outlets in Russia, according to statistics recently released on its website. The majority of these stores are likewise owned by the corporation, although in the rest of the globe, most are run by franchisees.
McDonald’s and Pepsi, both of which have long had a presence in Russia, have been singled out by the head of the New York state pension system.
According to Reuters, Thomas DiNapoli, the comptroller of the New York state common retirement fund, addressed letters to the corporations advising them to reconsider their operations in Russia due to “significant and escalating legal, compliance, operational, human rights and personnel, and reputational concerns.”
Depending on the conditions of agreements they may have with major food chains like KFC or Starbucks, franchise owners will often be allowed to decide whether or not to close franchises.
Kevin Johnson, the CEO of Starbucks, has criticized attacks on Ukraine as “unprovoked” and “unjust.”
According to its website, the majority of its locations in Russia are still operational. The Alshaya Group, located in Kuwait, manages the majority of these franchisees.
McDonald’s and Coca-Cola, according to Kathleen Brooks of Minerva Analysis, are “extremely intricate companies,” making a swift choice to leave Russia difficult.
Coca-Cola has a “extremely sophisticated system” involving bottling operations in Russia, she told reporters.
“I don’t believe it’s as simple as saying you can just leave Russia,” she explained. “These are sophisticated businesses with a lot to consider, but right now the reputation risk is wreaking havoc on their stock values, so they may have little option.”
“This is not the moment to be on the fence,” Dr Ian Peters, head of the Institute for Business Ethics, told reporters.
“What firms do in such situations will undoubtedly be judged throughout the world, and ethical judgment will be as crucial as complying with any government-led laws and fines.”
He claims that most businesses have a “ethical compass” that they utilize to make major choices.
“In such circumstances, we would urge companies to always look at the broader picture and aim to do the right thing, putting the greater good ahead of short-term profit,” he said.
Important ethical challenges that corporations may face when considering suspending operations in Russia, he said, include: What responsibilities do these businesses have to their personnel on the ground? Is it acceptable to deny Russian citizens access to basic necessities?
Kleio Akrivou, a professor of corporate ethics at Henley Business School, noted that these judgments could be more difficult for food corporations to achieve than, say, consultancy firms.
“Firms may need to address the issue more cautiously, with an appeal to practical reason, when it comes to sanctions that deprive the Russian populace of fundamental products and dignity.”
She believes that now is the moment for fast food behemoths to consider how such decisions effect actual people, as well as any potential reputational harm.