Despite tremendous business interest in Ukraine’s reconstruction and development, a large number of western companies continue to undermine Kyiv’s efforts by contributing to the Kremlin’s war chest. This ongoing corporate complicity must be stopped if Ukraine’s meaningful recovery is to happen any time soon.
Feeling abandoned and afraid on the rooftop of their flooded house, siblings Maksym and Masha together with their crying mother were amongst thousands of Ukrainians stranded in the region of Kherson. The destruction of the Nova Kakhovka dam unleashed a flood of suffering and long-term environmental damage whose full consequences are yet to be realized. Miraculously, Maksym’s family were detected by a military drone and eventually rescued by the Ukrainian armed forces. But stories with such a happy ending were rare in the aftermath of this man-made humanitarian disaster.
The latest Russian act of terror at the Nova Kakhovka dam combined with over 90 thousand recorded war crimes, clearly demonstrate that no reconstruction of Ukraine can succeed unless Russia is completely deprived of resources to wage its senseless war. We cannot have a meaningful conversation on recovery or reconstruction unless those international companies that continue to feed Russia’s war chest stop doing business with and in that country.
At the start of Russia’s invasion of Ukraine in 2022, some western businesses demonstrated swift and early exits from the tarnished Russian market, putting human values over profit. Yet the majority of western firms such as Austria’s Raiffeisen Bank, Germany’ Metro AG and France’s Auchan remained. According to data from the Kyiv School of Economics (KSE), out of 1,361 western companies with Russian subsidiaries at the start of the full-scale invasion only 241 (17%) have completely exited.
Analysis of the activities of 1,844 firms showed that they continued with “business as usual.” In 2022, these remaining companies generated $136 billion in revenue, thus helping the Kremlin to replenish its war coffers.
Perhaps even more staggering than the numbers involved are the excuses used by the leadership of western multinationals to justify their continued presence in Russia. The B4Ukraine Coalition, which I am a founding member of, has been engaging with these remaining businesses since the start of the full-scale invasion. The most widely cited reason for continuing with “business as usual” concerns providing so-called “essential goods.” Companies such as the American Mondelez International, the British conglomerate Unilever or the Swiss multinational Nestle are amongst those invoking this wholly hypocritical argument. Given the nature of their products and their increased profit margins in Russia, it is simply cynical to use such an excuse while Russia continues to terrorize people in Ukraine almost on a daily basis.
It should be crystal clear by now: all western companies that did not leave the Russian market after the annexation of Crimea and the occupation of Donbas, as well as those who have consciously decided to stay after the full-scale invasion of Ukraine are complicit in war crimes and crimes against humanity. These western businesses are silent enablers of this unjust war of aggression. Any meaningful conversation about Ukraine’s recovery and reconstruction should start by shedding a bright light on the issue of corporate complicity.
Ukraine’s true recovery can only happen when international businesses realize that this is not just a Russia-Ukraine war, but is Moscow’s war against the rules-based international order, with the peace and stability that western businesses have greatly benefited from over the years, currently being undermined by the man in the Kremlin.
Additionally, any meaningful conversations on Ukraine’s recovery should center around rebuilding of Ukraine’s human capital, green reconstruction efforts reliant on climate resilience and the use of clean energy. In this regard, international companies can play a tremendously important role. But our actions and values need to align.
Ukraine right now is providing an exclusive service to the free world, countering the malign nuclear neighbor that is a threat to itself and others. Ukrainians who are sacrificing their lives want to deal with international businesses that are ready to sacrifice some parts of their profits. We do not want to deal with war profiteers, but with those who understand that there is more at stake than just income. This is what a new era of corporate social responsibility is all about. In Ukraine, your commitment to CSR is measured by your willingness to forgo part of your profit to disable the Russian war machine from continuing to kill, rape or create ecocides.
The flooding that resulted from the Russian terrorist attack in Ukraine’s south is flushing down the reputation of those companies still doing business with Russia. Business has an important responsibility in places where it operates, especially in conflict-ridden areas. Companies can no longer afford to sit on both sides of the same fence. Either you are part of Ukraine’s reconstruction and recovery efforts or continue to support the destruction of its physical and human capital by feeding the Kremlin’s war chest.
Originally published in Kyiv Post
Nataliia Popovych is Founder & President of One Philosophy and Co-Founder & Member of the Steering Committee of B4Ukraine