Nestle said Wednesday that it was suspending sales of its KitKat and Nesquik brands in Russia, the latest effort from a global consumer giant to rethink operations in the country as it wages war on Ukraine.
Global brand owners including Unilever, Procter Gamble and Coca-Cola have been under pressure to pull out of Russia as Western countries try to squeeze Russia’s economy and thwart its ability to fund the war. But these brands are balancing multiple concerns, such as leaving behind investments in brands and factories, potentially disrupting complex supply chains and supporting sometimes sizable workforces.
Nestle said that it was suspending sales of “the vast majority” of its prewar volume of products in Russia, including pet food, coffee and candy. It has already halted “nonessential” imports and exports into and out of Russia, alongside advertising and capital investment. The company is also fully complying with all international sanctions on Russia, it said.
“While we do not expect to make a profit in the country or pay any related taxes for the foreseeable future in Russia, any profit will be donated to humanitarian relief organizations,” the company said Wednesday.
Nestle said its business going forward in Russia would “focus on providing essential food” to residents, like infant food and medical nutrition. Other brands, like Danone and PepsiCo, have similarly said they would continue productions of food and products deemed basic necessities. Critics have said such moves undermined efforts to starve the Russian economy and pressured companies to make all-or-nothing breaks from Russia. Maintaining even limited operations in Russia would make it easier for brands to restart broader business there, when or if they needed to.
Lawmakers in the United States, United Kingdom and Ukraine have urged companies to cut ties, and President Volodymyr Zelensky of Ukraine has specifically pointed to Nestle.
“‘Good food. Good life.’ This is the slogan of Nestlé. Your company that refuses to leave Russia,” Mr. Zelensky said in a video message addressing anti-war protesters in Bern, Switzerland, on Saturday.
Source: NY Times