B4Ukraine welcomes the decision of Unilever, a British fast moving consumer goods player (FMCG), to sell its business operations in Russia and Belarus to Arnest Group, Russia’s largest aerosol manufacturer. Unilever’s exit sends a clear message to the rest of the FMCGs remaining in the Russian market, including the Cadbury parent company Mondelez International, PepsiCo, P&G, Nestle and Mars.
The maker of Dove soap Unilever has been under sustained pressure from the British media and civil society groups, such as the Ukraine Solidarity Project, a member of the B4Ukraine coalition. In July 2023, the company’s CEO, Hein Schumacher, promised to look at Unilever’s Russia business operations with “fresh eyes” upon taking the helm of the company.
“We are pleased to finally see Unilever make the right move, even though such a decision comes two years too late. Depriving the Kremlin from additional sources of war financing is critical as Ukraine approaches 1,000 days of resistance against Russia’s brutal and unprovoked aggression. Unilever’s case clearly shows that - given enough political will - a clean exit from Russia is possible, despite a plethora of financial obstacles imposed by the Kremlin. No more excuses for Mondelez, PepsiCo, Mars, Nestle, P&G and other FMCGs remaining in Russia and feeding its militarized budget! It’s time to drop your keys and withdraw from this market once and for all,” said Nataliya Popovych, a co-founder of the B4Ukraine coalition.
Business operations in Russia are fraught with numerous risks, from the risk of overnight nationalization witnessed in the cases of Carlsberg and Danone to the risk of complicity in Russia’s growing number of war crimes, which currently stands at over 145,000. On the second anniversary of Russia’s full-scale invasion in February 2024, the US Government issued a business advisory on continued business operations in Russia, which clearly highlighted the fact that “businesses and individuals operating in Russia and occupied territories of Ukraine are at risk of being implicated in Russia’s violations of international law and human rights abuses.”
“Unilever’s decision to fully withdraw from the Russian market is good for the restoration of its public image. But it is not enough. We are asking them to contribute proceeds from the sale to help Ukraine’s reconstruction and development,” said Valeriia Voshchevska, the lead campaigner with the Ukraine Solidarity Project.
According to the estimates provided by the Kyiv School of Economics, foreign companies operating in Russia could have contributed USD 20 billion of tax revenue annually to Russia’s economy during the 2022-2023 time period. In the same time period, Unilever alone has paid USD 67 million just in profit taxes to the Russian state. There are currently over 2,000 firms operating in the market with only 427 having completed a full exit. Those remaining do not only provide financial bloodline to the Kremlin, but are also obliged to assist the Russian state with mobilization of eligible employees and the provision of material support deemed crucial by the state for its war effort.