These U.S. companies are still doing business in Russia – CBS News

Share Article

Watch CBS News
By Kate Gibson
/ MoneyWatch
The Starbucks logo and McDonald’s Golden Arches are being dismantled in Russia as the coffee and fast-food chains both withdraw from the country over the war in Ukraine. But Russians are still getting their fill of American fare like burgers and pizza, as Hard Rock Cafe and Sbarro are among the more than two dozen U.S. corporations that continue to do business as usual in Russia.
Twenty-seven U.S-based companies are defying calls to exit or curtail their activities in Russia, according to a running tally by Yale University management professor Jeffrey Sonnenfeld and his research team.
While Starbucks and McDonald’s have both announced their complete withdrawals from Russia in recent days, Hard Rock continues to operate its Hard Rock Cafes in Moscow and St. Petersburg, Russia. The company, acquired by the Seminole Tribe of Florida in 2007, did not respond to requests for comment.
Another purveyor of fast food, U.S. pizza chain Sbarro, is also staying put. Operating Russia since 1997, the privately held company signed a new franchise deal in the country in 2017. It has partnered with Horeca Band Group and plans to open more than 300 Sbarro restaurants in Russia by 2027. It did not respond to a request for comment.
It’s not only food chains that are “digging in,” according to Sonnenfeld. The owner of online dating services and its Tinder unit continues to do business in Russia, with executives at the dating company saying in an earnings call earlier this month that it expects to lose about $10 million in revenue every quarter as long as the Russian war in Ukraine continues. 
“European performance was impacted by the Russian invasion of Ukraine, which reduced revenue in Russia, Ukraine and several other nearby countries,” said Gary Swidler, Match’s chief operating and financial officer. 
Dallas, Texas-based-Match Group did not respond to a request for comment.
Dating app Bumble made a different decision. In March, the social networking platform said it was ceasing operations in Russia and removing its apps from the Apple App Store and Google Play Store in Russia and Belarus. 
Some companies regarded as among the worst offenders by Sonnenfeld and his team dispute the notion that they are conducting business as usual because they have not withdrawn from Russia.
Lake Forest, Illinois-based Tenneco, a supplier of automotive components, opened a manufacturing facility in Togliatti, Russia, in 2003, and an emissions plant in St. Petersburg, Russia, four years later. The company now has four plants in Russia, with two idled. “The other two we have ceased communication with and have no information on their status,” Tenneco said in an emailed statement.
Tenneco is complying with international laws and sanctions and has suspended cross-border shipments, with no raw materials, components or finished products going in or out of Russia or Belarus, it said.
“We remain focused on the health and safety of our people in Ukraine, Russia and other affected areas. We will continue to provide updates and do what we can to help our team members, customers and suppliers get through this situation safely as we hope for a peaceful resolution,” the company stated.
Another company, Des Moines, Iowa-based food additives supplier Kemin Industries, defended its ongoing operations in Russia as doing its part to offset hunger, including in Ukraine and Russia.
“With the long-held conviction that weaponizing food is abhorrent, Kemin continues to do its part to help feed people and assist crippling food insecurity magnified during a time of war,” the company said in a statement to CBS MoneyWatch. “Along with continuing to support employees in the region,” added the company, which formed a Russian subsidiary in 2016.
Domino’s Pizza’s nearly 200 stores in Russia remain open, with DP Eurasia, the owner of the master franchisee for Domino’s in Russia saying it has suspended additional investment for now and won’t accept royalty payments from its Russian operations until further notice. 
“There has been no material disruption to the group’s operations in Russia from the ongoing situation in Ukraine. Trading from the group’s 188 stores continues and the group remains dedicated to the communities it serves. The board has, however, determined it prudent to limit any further investment into its operations in Russia and will keep this under review going forward in light of the geopolitical situation,” the company said in releasing financial results in April.
The stance places it in the “Buying Time” category devised by Sonnenfeld, with a “D” grade for its decisions.
Here’s a rundown of the other American companies that are getting an “F” grade from Sonnenfeld for their decisions regarding their operations in Russia. 
First published on May 24, 2022 / 5:00 AM
© 2022 CBS Interactive Inc. All Rights Reserved.
Copyright ©2022 CBS Interactive Inc. All rights reserved.
Quotes delayed at least 15 minutes.
Market data provided by ICE Data Services. ICE Limitations. Powered and implemented by FactSet. News provided by The Associated Press. Legal Statement.


You might also like

Surviving 2nd wave of corona

Surviving The 2nd Wave of Corona

‘This too shall pass away’ this famous Persian adage seems to be defeating us again and again in the case of COVID-19. Despite every effort