The food and beverage industry in Russia continues to attract criticism from various sources, including B4Ukraine, which highlights the presence of Western companies like PepsiCo, Danone, and Mars in the country. These companies, along with others, have been accused of being complicit in the war crimes and crimes against humanity committed by the Putin regime.
According to data from the Kyiv School of Economics, the top revenue-generating industries in Russia last year were alcohol and tobacco, FMCG, automotive, and food and beverages. Major European brands such as Unilever, Danone, and Nestlé are still operating in Russia but have scaled back their activities since the invasion of Ukraine.
Global corporations that have remained in Russia generated a significant amount of revenue through local businesses and paid “profit taxes,” although B4Ukraine believes the reported amount is likely an underestimate.
PepsiCo, Danone, and Mars were among the top revenue generators in Russia last year. Mars and Mondelez International also saw significant increases in revenue. B4Ukraine calls for these companies to cut ties and exit responsibly.
“Clarity needed”
B4Ukraine emphasizes that companies claiming to provide essential goods and services to the Russian population should clarify the criteria and process they used to reach that conclusion. Nestlé, however, hasn’t publicly disclosed its Russian revenues but has indicated that it has no plans to withdraw operations entirely.
Multiple food and drinks companies have scaled back their operations in Russia, suspended investments, and reduced advertising. Despite these actions, they continue to supply products considered essential or everyday items.
Danone announced in October its plan to exit the essential dairy and plant-based business in Russia but will still supply specialized nutrition products. The company disputes the figures presented by B4Ukraine and the Kyiv School of Economics.
B4Ukraine suggests that governments should discourage companies from operating in Russia through deterrent measures such as financial penalties, restricted access to contracts, exclusion from public procurement opportunities, and increased disclosure requirements.
The influence of G7-headquartered companies in Russia is also highlighted, with B4Ukraine claiming they contributed nearly a quarter of profit taxes in the country last year.
Unilever was recently added to Ukraine’s “sponsors of war list,” and Mondelez faced a boycott of its products in Norway.
Unilever has previously warned of the financial risks associated with withdrawing from Russia. PepsiCo, Mars, and Mondelez have yet to respond to the B4Ukraine report.