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Geopolitical corporate responsibility can drive change

EXPERT COMMENT

Russia’s long invasion of Ukraine is testing the commitment of business, but this could see the emergence of a new pillar of support for the rules-based international order.

The massive exit of more than 1,000 international companies from Russia has surpassed – by a factor of nearly ten in merely four months – the number which pulled out of apartheid-led South Africa over an entire decade.

These company exits extend beyond those industries targeted for sanctions – oil and gas, banks and financial services, aerospace, and certain technology sectors – to include hundreds in consumer products ranging from Levi’s and H&M clothing to Coca-Cola and McDonalds. Many of these companies may wish to return to a post-conflict – or post-Putin – Russia, while a few have already sold their Russian operations, as McDonald’s has to an existing Siberian licensee.

Both reputational and operational factors are driving the huge exodus: reputational as companies have chosen to disassociate themselves from Putin’s regime; operational as transportation routes and supply chains have been interrupted.

Few of these companies have made explicit the principles at stake, while many still face ‘tricky legal, operational and ethical considerations’ and some have kept operations in place. But the collective impact of the exit in response to Russia’s affront to international law has sent shockwaves around the world.

Click here to continue reading the full version of this Expert Comment on the Chatham House website.

 

Channel website: https://www.chathamhouse.org/

Original article link: https://www.chathamhouse.org/2022/07/geopolitical-corporate-responsibility-can-drive-change

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