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| Caucasus/Russia/Central Asia |
| ‘Digging In’: Koch Bros., also Oilfield & Agribusiness Giants Remaining in Russia (Halliburton, Baker Hughes, Schlumberger, Cargill, Archer Daniels Midland, Bayer) |
| 2022-03-22 |
| [LATimes] The “hall of shame,” as Yale business professor Jeffrey Sonnenfeld and his colleague Steven Tian have labeled the roster of corporate responses to Russia’s invasion of Ukraine they’re maintaining, includes 24 companies that are “digging in, defying demands for exit or reduction of activities.” The list also includes 80 companies that are scaling back some but not all activities or deferring new investments. Among the consumer companies identified as “digging in” are the fast-food chain Subway; Reebok; Bacardi (maker of its eponymous rum, Dewar’s Scotch and Grey Goose vodka, among other brands); the electronics companies LG and Asus; and Natura, owner of Avon cosmetics. Some of those firms and others that have scaled back operations have asserted that they’re remaining in place to avoid harming their innocent Russian employees. That’s the argument made by Dave Robertson, president and chief operating officer of Koch Industries, which is known for its support of far-right politicians in the U.S. Robertson said that the Koch subsidiary Guardian Industries employs 600 workers at two glass factories in Russia, which will continue to operate. “We will not walk away from our employees there or hand over these manufacturing facilities to the Russian government so it can operate and benefit from them,” he said Wednesday in a statement. “Doing so would only put our employees there at greater risk and do more harm than good.” Others say business models that involve licensing or franchise agreements preclude them from promptly or fully shutting down. That’s the story told by Subway, which says it has about 450 restaurants in Russia, “all independently owned and operated by local franchisees,” Subway says. “We don’t directly control these independent franchisees and their restaurants, and have limited insight into their day-to-day operations.” The change in the political atmosphere in Russia under Putin seems to have caught Western corporate managements by surprise. That shouldn’t have happened. It was always clear that Russia’s post-Soviet economic and political landscape was unstable at best. Mikhail Gorbachev’s perestroika, or restructuring, yielded to financial lawlessness and the rise of a privileged class of oligarchs resembling organized crime capos. Corporate managements didn’t know how to react when Putin’s behavior began to inject even worse instability into the Russian environment. “Putin had his pouts and tantrums, but they thought they could just glide through them, that they wouldn’t be a serious threat,” Sonnenfeld says. “The spirit of perestroika was wildly optimistic,” he says. “These brands — Levi Strauss and Pepsi and McDonald’s — thought they were representing Western values and a spirit of freedom and global harmony. They were blind to the signals because of perestroika ideology and the religion of the free market.” The harvest has been a sudden rush to the exits that could mean the loss of billions of dollars in long-term investments. The most notable companies identified by Sonnenfeld as “digging in” are three major oil-field services firms, all based in Houston: Halliburton, Baker Hughes and Schlumberger. Russia’s oil and gas industry isn’t currently subject to the full panoply of international sanctions, but it’s dependent on those firms for drilling and production. The U.S. has banned imports of Russian petroleum products and forbidden U.S. companies to make new investments in the Russian industry; the European Union has also banned new capital investments. Of the three, only Halliburton has commented publicly about the sanctions. The comments came during a meeting with securities analysts on Jan. 20, when Chief Executive Jeffrey Allen Miller was asked whether the prospect of sanctions would affect “the trajectory of the business in Russia.” Miller replied, “These are things we’ve seen and done before. Always unfortunate in so many ways for so many people. But from a business perspective, we’ve managed these sorts of things up and down for, I hate to say, nearly 100 years. So these are the kinds of things that we would manage through.” |
| Posted by:Chusoger Thrusosh4089 |
| #11 Whatever it is, I SUPPORT THE CURRENT THING 🌈✊🏾🇺🇦👩🏾🏫 |
| Posted by: Spinenter Grerenter6527 2022-03-22 14:57 |
| #10 Actually I think the war is over by now? Seeing the news stations at the gym for an hour or so, there was no mention of it at all on any of the stations. It was all Ketanji all the time. So I guess the war is over, and everyone can go back to Russia now? |
| Posted by: Tom 2022-03-22 11:41 |
| #9 I do have it all. Now shut up and eat your bio-burger. Bill Gates is the biggest private owner of farmland in the United States. Why? |
| Posted by: Farmer Bill Gates 2022-03-22 10:06 |
| #8 /\ Yes, money and land. You should have none. I should have it all. |
| Posted by: Besoeker 2022-03-22 09:51 |
| #7 At the gerbil elite and academic levels, property is theft. Except for theirs. Yours is up for grabs, prole... |
| Posted by: M. Murcek 2022-03-22 09:49 |
| #6 I also have to ask, when did it become the 'right thing to do' to commandeer private citizens money and property regardless of nationality without any due process. Ask not for whom the bell tolls |
| Posted by: Daffy and Company2015 2022-03-22 09:44 |
| #5 Well said TW but you omit their fiduciary responsibility to their shareholders. That and the reality is some forces are effectively trying to cancel not the Russian military or leadership but every Russian citizen they possibly can. I also have to ask, when did it become the 'right thing to do' to commandeer private citizens money and property regardless of nationality without any due process. Equally to unilaterally break contracts. No law, statute, or even emergency order has been invoked to steal from ordinary citizens. Before during and after the Revolutionary War George Washington, John Adams and many other American patriots well known on both sides of the Atlantic had accounts at the Bank of England. Those accounts were never touched by the Crown or bank management. Nobody wants to see Ukrainians suffer, neither Ivan. But there is something else going on here more akin to mob behavior than not. If you think it is somehow reserved for Russian nationals, well if they can so readily steal from a billionaire, what do you think that means for the rest of us? Oh, and how's that schedule coming along for the global population divesting itself of everything, happily of course? |
| Posted by: Cesare 2022-03-22 08:54 |
| #4 Yale School of Management's Dean Jeffrey Sonnenfeld laments "the religion of the free market.” 🤣 Only at Yale... |
| Posted by: Galactic Coordinator Elmoter9992 2022-03-22 08:41 |
| #3 "The Capitalists will sell us the rope with which we will hang them." ― Vladimir Ilich Lenin |
| Posted by: Procopius2k 2022-03-22 08:30 |
| #2 Rational and wise are not necessarily the same thing. Ditto smart and wise. I’m not arguing on one side or the other in this situation, but business manager types sometimes get so caught up in being rational and smart that they lose track of other factors. I’ll just wish all involved on all sides the best of luck that things work out as they hope, not as they fear. |
| Posted by: trailing wife 2022-03-22 01:51 |
| #1 "Hall of Shame" - LOL These are supremely rational people, some of the smartest businessmen on the planet. No privately-held company in America has come even close to the returns on invested capital achieved by the Koch Brothers over the last 30 years. "Beyond phenomenal," per Roger Altman. Ditto for Mulliez ('Auchan' holding company) in France. And Halliburton & Schlumberger's investors are very happy indeed. What a carnival of stupidity and self-destruction we in the West are witnessing |
| Posted by: Blackbeard Gravitle2000 2022-03-22 00:34 |