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A growing list of marketers and suppliers cut ties with Russia.
By: Tom Branna
April 1, 2022
Two years ago, LVMH was the first company in our industry to begin producing hand sanitizer in an effort to combat the covid-19 pandemic. It wasn’t long before nearly every multinational in the global household and personal products industry was donating money, food, cleaning products and, of course, hand sanitizer. Our industry stepped up again when Russia invaded Ukraine. According to research by the Yale School of Management, at press time, more than 300 companies have withdrawn from Russia. The Yale list, as this issue went to press, includes Chanel, Clorox, Coty, Dow, Estée Lauder, Henkel, Kimberly-Clark, L’Oréal, LVMH, Procter & Gamble, Unilever and Vantage. “Our many Russian colleagues, and the people of Russia, face challenges and uncertainty for their futures that are also significant. P&G will continue to support them, but the situation necessitates important changes immediately and over time,” said CEO Jon Moeller. “Our hearts go out to all people who endure the unspeakable human toll of war, and we condemn aggression in any circumstance. We join the world in praying for peace.” What impact these moves have on Vladimir Putin’s invasion is anyone’s guess. But observers say the exodus will impact Russian citizens’ psyche. “I was in Moscow in the 1990s after the first McDonald’s restaurants opened, and I remember the excitement,” Matthew Schmidt, an associate professor of national security at the University of New Haven, told NBC News. “So yes, the departure of a McDonald’s or Coca-Cola is bound to have a psychological effect on the Russians.” Yohanan Petrovsky-Shtern, a Ukrainian native and professor of Jewish history at Northwestern University who studied in Moscow for many years, said many Russians will merely shrug off the departure of some of their favorite brands. But he added, “more sober Russian observers know that Russia has failed to produce decent-quality mass consumption products. ” According to Petrovsky-Shtern, young Russians, particularly those born after 1990, are alarmed and don’t want to be isolated like North Korea. “They do not want to find themselves in yet another North Korea,” he said. “One of the biggest stories that is not being reported is about thousands of middle-class Russians who are voting with their feet and fleeing the country for Kazakhstan, Armenia, Kyrgyzstan, and Georgia because they fear losing their standard of living and fear being drafted to fight in this war they don’t want.” The pandemic may have ushered in a new normal. But Putin’s War may signal a new way that corporations can have a positive impact on world events. Tom Branna Editorial Director [email protected]
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