Investor Indifference to Moral Concerns
Mondelez’s CEO Dirk Van de Put suggests that investors are more concerned about financial impact than moral considerations regarding companies’ operations in Russia.
Limited Shareholder Pressure
Despite operating in Russia post-invasion, Mondelez hasn’t faced significant pressure from shareholders to exit the country, as its Russian business contributes a relatively small portion of its global revenues.
Navigating Legal and Ethical Obligations
Under US law, companies prioritize financial results over moral concerns. Mondelez’s Russia revenue falls below the threshold for material issues, allowing it to continue operations despite criticism.
Defending Business Decisions
Van de Put defends Mondelez’s decision to maintain operations in Russia, arguing that leaving would only benefit Putin’s allies. He questions the fate of assets sold by departing companies and their impact on the war.
Operational Realities in Russia
Mondelez operates independently in Russia, with 2,700 employees and profitable operations. The company has reduced investments while continuing production.
Transparency Amidst Criticism
As consumer-facing companies face scrutiny for their Russian subsidiaries, CEOs like Van de Put are becoming more transparent about their decision-making process amidst geopolitical tensions and consumer pressure.
Potential Repercussions and Continued Operations
The FT’s report on Danone’s plans to sell its Russian business to a Kremlin-linked individual highlights the complexities and risks associated with operating in Russia post-invasion.
Consumer Backlash and Ethical Considerations
Consumer boycotts and criticism from Ukrainian groups demonstrate the ethical dilemmas faced by companies like Mondelez operating in Russia amidst the conflict.
Maintaining a Low Profile
Van de Put emphasizes Mondelez’s non-confrontational approach in Russia, focusing on business operations while being mindful of geopolitical sensitivities and potential consequences for departing companies.
Related: Mondelez International Announces New Chief People Officer
