Unilever chose ‘least bad’ option by staying in Russia, boss says
The business has revealed it would allow its Russian staff to be conscripted by the Russian armed forces
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Your support makes all the difference.The boss Unilever has insisted that the company chose the “least bad” option by staying in Russia days after the consumer goods giant admitted it would allow its Russian staff to fight in Ukraine if they were called up.
The business, which is behind dozens of brands including Ben & Jerry’s, Dove soap and Hellmann’s mayonnaise, was earlier this month named as an “international sponsor of war” by Ukraine’s National Agency on Corruption Prevention.
On a call with reporters on Tuesday, chief executive Hein Schumacher said that Unilever was guided by two main principles in how it runs its Russia business.
“We have a continued responsibility vis-a-vis our employees in Russia and … we do not intend to further contribute to the financial capacity of the Russian state,” he said.
He said this left the company with three options: To abandon the Russian business, to sell it, or to “pursue our business in a highly constrained manner”.
The last option is what Unilever has selected, he said.
“With the evolving developments in Russia, we conclude that none of the options are actually good, but that the final option of operating our business in a constrained manner is the least bad.”
Last year Unilever paid 3.8 billion rubles (£33 million) in tax to the Kremlin, largely unchanged compared to the year before.
Ukraine’s Government said this month that the company had doubled its profit in Russia compared to the year before to around 9.2 billion rubles.
On Sunday, B4Ukraine, a coalition of NGOs which pressures companies to exit Russia, released a letter it had received from Unilever.
In it, chief business operations and supply chain officer Reginaldo Ecclissato said that Unilever would let its workers fight in Ukraine if they were called up by the Kremlin.
“We are aware of the law requiring any company operating in Russia to permit the conscription of employees should they be called,” he wrote.
“We always comply with all the laws of the countries we operate in.”
He also wrote: “We continue to run our business in Russia in alignment with our global principles including the safety and wellbeing of our employees.”
Unilever did not take questions on Tuesday’s call on how many of its approximately 3,000 Russian staff had been conscripted into the armed forces, whether any of its Ukrainian workers have been killed or whether Unilever’s tax money is being used to fund the Kremlin’s war against Ukraine.
When asked these questions in an email following the call, Unilever said: “Sorry we couldn’t cover your questions. I’m afraid there is nothing to add on Russia to what Hein said on the call.”
Last month Oreo and Cadbury owner Mondelez faced a major boycott, especially in Scandinavia, after being put on Ukraine’s International Sponsors of War list.
Several companies, including Sweden’s railway company SJ, airline SAS, and Norwegian Air, joined the boycott of the confectionary giant.
Earlier this month Oleksandr Novikov, the head of Ukraine’s NACP, said: “Unilever cannot say it is opposed to the war while at the same time contributing to Putin’s war machine.
“We have added them as an International Sponsor of War because their hundreds of millions in tax contributions to the Russian state are helping to fund its attacks on Ukraine and could be indirectly funding a mercenary criminal group.
“Unilever has a new CEO in Hein Schumacher, it needs a new start and to live up to its values of human rights. Unilever must leave Russia now or history will record its complicity.”
It is not the first time that Unilever has run into hot water over the Ukraine war. In February, its brand Ben & Jerry’s tweeted that US President Biden should not send troops to Europe in response to Vladimir Putin’s aggression.
Ben & Jerry’s co-founder Ben Cohen told Politico last week that he supports “negotiations to end the war instead of providing more weapons to continue the war”.
Unilever owns ice cream brands Carte D’Or, Cornetto, Ben & Jerry’s, Magnum, Wall’s and Viennetta.
It owns food brands Colman’s, Bovril, Hellman’s, Knorr, Maille mustard, Pot Noodle, Marmite and the Vegetarian Butcher.
It also owns cleaning brands Cif, Domestos, Comfort, Persil and Surf, as well as personal hygiene brands Dove, Lifebuoy, Lynx, Radox, Shea Moisture, Simple, Sure, TRESemme and Vaseline.