Russia’s invasion ofisn’t stopping McDonald’s from selling Big Macs in Moscow. While a slew of companies have shut down the world’s largest fast-food chain has so far continued with business as usual in the country despite the escalating conflict.
McDonald’s is being urged to pull the plug on its 847 restaurants in Russia by a major investor: New York state’s pension fund, with an estimated $280 billion in assets under management as of the end of 2021.
“Pausing or ending McDonald’s business operations in Russia would address various investment risks associated with the Russian market and play an important role in condemning Russia’s role in fundamentally undermining the international order that is vital to a strong and healthy global economy,” state comptroller Thomas DiNapoli stated Friday in a letter to McDonald’s CEO Christoper Kempczinski.
More than 200 US and foreign companies have curtailed operations in Russia so far, according to a running tally by Jeffrey Sonnenfeld, a management professor at Yale University. He lists McDonald’s and Pepsi as among 32 companies that remain in Russia with significant exposure.
According to its investment page, 84% of McDonald’s restaurants in Russia are owned by the Chicago-based company, with Russia representing 9% of the company’s total revenues. The company opened its first outlet inthree months after the fall of the Berlin Wall.
The Office of New York State Comptroller is also urgent snack and beverage conglomerate PepsiCo, as well as eight other companies, to suspend business in Russia, a spokesperson told CBS MoneyWatch in an email. None of the companies have responded yet, the spokesperson added.
“Companies like McDonald’s and PepsiCo, which have a large footprint in Russia, need to consider whether doing business in Russia is worth the risk during this extraordinarily volatile time,” DiNapoli said in an emailed statement. “We’re encouraging the companies we invest in to do a risk analysis and determine what is in the best interests of their company and their shareholders.”
Neither McDonald’s nor PepsiCo responded to emails from CBS MoneyWatch requesting comment on whether they plan to continue operating in Russia.
The inaction by McDonald’s and PepsiCo spurred calls for a boycott of both companies on social media.
“I’m not lovin’ it. @McDonalds is continuing to do business as normal in Russia, which means the corporate and sales taxes it pays there DIRECTLY support Putin’s illegal and murderous war in Ukraine,” one person said.
Other fast-food chains and beverage companies also are drawing fire onlineincluding Burger King, Coca-Cola, Starbucks and KFC owner Yum Brands.