Detroit, March 9
McDonald's, Starbucks, Coca-Cola, PepsiCo and General Electric - ubiquitous global brands and symbols of US corporate might - all have announced they were temporarily suspending their business in Russia in response to the country's invasion of Ukraine.
"Our values mean we cannot ignore the needless human suffering unfolding in Ukraine," McDonald's President and CEO Chris Kempczinski said in an open letter to employees.
The Chicago-based burger giant said it would temporarily close 850 stores but continue paying its 62,000 employees in Russia "who have poured their heart and soul into our McDonald's brand". Kempczinski said it's impossible to know when the company would be able to reopen its stores.
"The situation is extraordinarily challenging for a global brand like ours, and there are many considerations," Kempczinski wrote in the letter. McDonald's works with hundreds of Russian suppliers, for example, and serves millions of customers each day.
Last Friday, Starbucks had said that it was donating profits from its 130 Russian stores - owned and operated by Kuwait-based franchisee Alshaya Group - to humanitarian relief efforts in Ukraine. But on Tuesday, the company changed course and said it would temporarily close those stores.
Alshaya Group will continue to pay Starbucks' 2,000 Russian employees, Starbucks President and CEO Kevin Johnson said in an open letter to employees.
"Through this dynamic situation, we will continue to make decisions that are true to our mission and values and communicate with transparency," Johnson wrote.
Coca-Cola Co announced it was suspending its business in Russia, but it offered few details. Coke's partner, Switzerland-based Coca-Cola Hellenic Bottling Co, owns 10 bottling plants in Russia, which is its largest market. Coke has a 21 per cent stake in Coca-Cola Hellenic Bottling Co.
PepsiCo and General Electric both announced partial shutdowns of their Russian business.
General Electric also said in a Twitter post that it was partially suspending its operations in Russia. GE said two exceptions would be essential medical equipment and support for existing power services in Russia.
McDonald's is among those to take the biggest financial hit. Unlike Starbucks and other fast food companies like KFC and Pizza Hut, whose Russian locations are owned by franchisees, McDonald's owns 84 per cent of its Russian stores. McDonald's has also temporarily closed 108 restaurants it owns in Ukraine and continues to pay those employees.
In a recent regulatory filing, McDonald's said its restaurants in Russia and Ukraine contribute 9 per cent of its annual revenue, or around USD 2 billion last year.
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