A corporate exodus has followed the invasion of Ukraine, with major international firms withdrawing or limiting their operations in Russia in response.

McDonald's and Starbucks are two of the latest corporations to take this step after facing pressure to pull out. According to research from Yale University, more than 300 major international businesses have so far reacted to the brutal invasion of Ukraine. From the retail sector to energy, tech and entertainment, over the course of two weeks global Western firms rushed to exit the increasingly isolated nation.

But for companies with a larger exposure to Russia, the decision to cut links with Moscow might hurt more than the reputational risk of staying in the market.

Big players split down middle

Half of the 10 largest international companies in Russia have decided to pause or reduce their operations, pointing to supply chain issues and the military crisis in Ukraine. The rest have said little to nothing about the situation since the war began.

That's the case for the Swiss-American tobacco manufacturer Philip Morris International, which in 2020 ranked as the international company with the largest revenues in Russia, after raking in nearly $2.6 billion (€2.4 billion). The company has temporarily interrupted its business in Ukraine, but continues its activities in Russia and says it is closely following further developments.

Who's staying? Who's left?

Another top player, Japan's tobacco manufacturer JTI, has five factories and 4,500 employees across Russia. It currently maintains its operations in Russia, but has suspended local production in its plant in Ukraine, pointing to concern for workers' safety.

A handful of French firms with exposure to the Russian market also continue to trade. Home retailer Leroy Merlin, which follows Philip Morris in terms of revenue,  last week said its 112 stores across Russia will continue to operate normally and that it doesn't plan to withdraw itself from the market. The group Auchan, another gigantic French retailer with nearly 300 stores and 41,000 employees in Russia, hasn't shown any sign of halting its operations either.

Carmakers

Some carmakers rushed to stop on-the-ground production in Russia as the war intensified. Both Germany's Volkswagen and Japan's Toyota halted production at their Russian factories and suspended car exports to Russia indefinitely, citing disruptions in the supply chain. Luxury carmakers Rolls Royce, Jaguar Land Rover and Aston Martin interrupted sales and shipments to Russia, while Mercedes Benz and BMW stopped exports and production on the ground. Volvo, Nissan, Honda, Ford and General Motors have implemented similar measures.

But for Renault Group, a deal sealed in 2007 ties the French carmaker to Russia, which with 12% of its revenue represents its second-biggest market. Back then, Renault entered this booming market through the acquisition of AvtoVaz, the maker of the iconic Soviet-era Lada.

Tech

Several tech companies have closed up shop. Software companies Microsoft and SAP are among those who have suspended the sales of new products.

Google and Facebook parent Meta banned Russian state media from running and profiting from ads on their platforms. Spotify announced the closing of its Moscow office, but said it will continue to allow access to its content in an effort to counter propaganda and misinformation.

Despite a large exposure to the Russian market, tech companies Apple and Samsung have chosen to respond to sanctions imposed by the US, the EU and others.

Apple interrupted all local product sales through Apple Stores and limited the functionality of some of its services, including its payment platform Apple Pay.  Despite leading the Russian smartphone market, Samsung paused smartphone and chip shipments to Russia.

Fashion

Fast fashion brands H&M and Zara announced their retreat from the Russian market last week, temporarily shutting their shops and halting local sales. The American denim brand Levi's, which became a symbol of freedom during the Soviet era, joined on Monday.

Sports brands Nike, Puma and Adidas also joined the exodus of fashion retailers. Adidas even went a step further, suspending its partnership with the Russian Football Federation.

Luxury brands Chanel, Prada, Hermes, Burberry, LVMH Moët Hennessy Louis Vuitton and Kering, which owns Gucci and Saint Laurent, have paused their sales as well.

Finance

International payment giants Visa, Mastercard and American Express promptly halted their services after the imposition of sanctions. Visa, for example, announced the interruption of all its transactions and warned that cards issued in Russia would no longer work abroad.

Payment platform PayPal has also shut down its services.

Food and retail

Along with McDonald's and Starbucks, Coca-Cola has also said it is exiting the Russian market. Consumer goods brands Unilever and Kraft Heinz suspended all Russian imports and exports.

Swedish furniture retailer IKEA announced last week the decision to pause its production and retail operations in Russia and Belarus, as well as halt all imports and exports to and from those countries.

Edited by: Kristie Pladson