Carlsberg and Burger King Holdings (NYSE:BKC) have both made headlines over the past week for their continued involvement in Russia, despite previous pledges in the wake of the invasion of Ukraine.
Whether it be through struggles dealing with the state or complicated business structures, as cited by Carlsberg and Burger King respectively, continued presence in Russia has become a topic of controversy for many companies since the war began in February 2022.
Carlsberg, for instance, opted to write down the entire value of its Russian business, Baltika, on Tuesday, alongside cancelling the subsidiary’s license to produce and sell its products.
This follows heated dealings with the firm’s new directors, who were installed as the Russian state seized control of the business in July.
“We currently see no path to a negotiated solution for exiting Russia,” Carlsberg’s Tuesday statement read.
“We are continuing to take all possible actions, including legal, to protect our employees, assets and operations.”
So rather than the smooth exit that Carlsberg hinted to as early as March last year, it seems the Danish brewing giant is instead tied in for the foreseeable, as the prospect of legal battles builds.
Burger King
Burger King faced scrutiny earlier this week on reports its business continued to carry on as normal in Russia meanwhile, despite pledges to leave in March 2022.
Though the fast food giant had admitted initially that the process would be complicated, critics from Yale University—who track firms’ responses to the war—lashed out.
“Saying they want to leave but then dragging their feet is not the same as actually exiting Russia,” researcher Steven Tian said.
“By continuing to do business in Russia [...] they are sustaining Putin's regime.”
Restaurant Brands International (TSX:QSR, NYSE:QSR) (RBI), a primary stakeholder in Burger King’s Russian business, looked to justify it by pointing out that the firm had not turned a profit in the country since early 2022 and was refusing to make a new investment.
According to the group, any exit would “take some time” given Burger King is franchised, with the restaurant’s main operator in Russia allegedly having refused to shut sites last year.
Rival McDonalds Corp was among Western firms to successfully flee Russia last year alongside the likes of KFC parent Yum! Brands (NYSE:YUM) and Starbucks Corp (NASDAQ:SBUX), perhaps spelling awkwardness for the burger chain.
There are “no new updates to share at this time," RBI said earlier this week though, with the firm now having started to dispose of its stake in the Russian Burger King business.
BT Group
British telecoms giant BT Group PLC (LSE:BT.A) — perhaps surprisingly— is also among those stubbornly carrying on operations in Russia.
Despite a quick exit by the likes of Microsoft Corporation (NASDAQ:MSFT), Ericsson and Oracle Corp in 2022, BT’s reasoning for staying came from concerns that calls would no longer be possible between the UK and Russia were it to leave.
BT had reportedly explored cancelling ties with Russian-state-backed telecoms firm Rostelecom at the time of the invasion but opted in favour of keeping communication links open.
Unilever
Unilever marks another of London’s FTSE-100 constituents continuing to trade in Russia, having committed to operating under strict constraints after the war broke out in 2022.
Under these self-implemented rules, Unilever ended imports and exports of goods in and out of Russia but committed to continue selling essential goods.
Though the choice of these goods has faced scrutiny, with reports slating Unilever’s decision to continue selling ice cream after it reported the Russian business turned a profit in 2022, Unilever has argued that staying in the country was the lesser evil.
“For companies like Unilever, which have a significant physical presence in the country, exiting is not straightforward,” the firm said earlier this year.
Selling up would likely benefit the Russian state, according to Unilever, while closing entirely would impact thousands of local workers.
Conversely, campaigner Leave Russia noted the taxes Unilever would have paid to the Russian state since the start of the war given its profits in the country.
Shell
Complexities were also cited by Shell PLC (LSE:SHEL, NYSE:SHEL) when it initially spoke of exiting the Russian oil and gas sector in March 2022.
Though Shell has indeed sold its Russian businesses, such as service stations, and ended a partnership with local oil giant Gazprom, scrutiny came in July as reports emerged that the company was still involved in the country.
According to campaign group Global Witness, Shell carried some 7% of Russia’s seaborne shipments of liquified natural gas in 2022.
These are said to have continued into this year with Shell citing “long-term contractual agreements” as a key reason for the ongoing trades.
Shell had apologised for continued trade in Russia following the outbreak of war in 2022, having committed to a “phased” wind-down of operations at the time.
However, the ongoing ties with Russia have left Shell facing accusations of scoring "blood money."
In response, Shell pointed to the dilemma of needing to leave Russia while also ensuring energy supplies elsewhere.
"It is for governments to decide on the incredibly difficult trade-offs that must be made," the company said in July.
Others
Approaching 20 months since the war began in Ukraine, the entire list of companies still tied to Russia is long.
From consumer goods business Proctor & Gamble, to beverage maker PepsiCo (NASDAQ:PEP), to make-up company L’Oreal, hundreds upon hundreds of companies still operate in the country. The extent of the firms' actual commitments to embargo Russia now coming to light.