American brands quitting Russia has more than symbolic significance. After years of cultivating the Russian market, Coca-Cola, McDonald’s and PepsiCo were among the companies yesterday that announced a pause to their operations there. Since Soviet times, these firms came to symbolize the opening of Moscow to the West. Starbucks also said it would close all of its locations and Yum Brands said some of its KFC and Pizza Hut locations would suspend operations.
Although these companies’ Russian operations account for single-digit percentages of group profits, their absence will be felt: McDonald’s, for example, employs 62,000 people in Russia. (The company said it would continue to pay salaries.) “It appears that much of the Russian populace knows little about the attack on Ukraine,” Louis Wells of Harvard Business School told DealBook. “If McDonald’s and Coca-Cola disappear along with Ikea and other foreign brands, people have to ask why.”
The pressure on companies to act is growing, from investors, employees and social media campaigns. The list of company actions compiled by Jeffrey Sonnenfeld of the Yale School of Management, updated daily, is a focus for a variety of stakeholders, and a major point of discussion in the boardrooms of companies highlighted because they have yet to disclose their Russia plans.
HERE’S WHAT’S HAPPENING
Regulators reportedly examine options trading at Activision Blizzard. The Justice Department and the S.E.C. are looking into purchases that Barry Diller, Alexander von Furstenberg and David Geffen made in January, days before the video game maker agreed to sell itself to Microsoft, The Wall Street Journal reports. Diller denied that the men acted on inside information.
A Chinese nickel producer may face big trading losses. Tsingshan Holding Group is sitting on potentially billions in paper losses, after fears of supply shortages sent nickel prices skyrocketing, according to The Wall Street Journal. (Trading in the metal is suspended until at least Friday.) The price jump has hurt producers like Tsingshan that sold nickel contracts as part of their standard hedging strategies.
Elon Musk asks to end an S.E.C. settlement. Lawyers for the Tesla chief asked a judge to scrap a legal agreement that requires some of his business-related tweets to be vetted before posting. The rationale: The S.E.C.’s monitoring his tweets means “Mr. Musk’s freedom of expression is infringed.”
Broad mask mandates in the U.S. are over. Hawaii became the last state to announce an end to universal mask requirements, though they’ll still be required indoors at public schools. Relatedly, a C.D.C. study found that mask mandates appear to have helped protect children from the coronavirus.