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March 26, 2022, 10:46 a.m. EDT

Yale professor monitoring companies still doing business in Russia ups the ante by highlighting those that are now ‘digging in’

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By Ciara Linnane

The Yale professor who is monitoring companies that are still doing business in Russia following its unprovoked invasion of neighboring Ukraine has upped the ante by reclassifying the list into five categories with the fifth titled “digging in” — or defying public demands for exit.

Some 39 companies, including Koch Industries Inc., packaging company Ball Corp. , family-owned consumer-goods company SC Johnson and cybersecurity company Cloudflare Inc. /zigman2/quotes/214109260/composite NET -4.62% , remain in that category four weeks after the start of the attack.

More than 450 companies have announced plans to pull out or curtail their activities in Russia since the list was first published by Jeffrey Sonnenfeld and his research team at the Yale School of Management. The situation remains fluid for now, with the Yale team updating the list on a daily basis.

See: Yale professor is keeping tabs on companies still operating in Russia despite Ukraine invasion — and many have now pulled out

“The idea here is to bring the Russian economy to a standstill,” Sonnenfeld told MarketWatch. “That’s what Gandhi did [in India], it’s how Ceaușescu was removed from power in Romania, [and] it’s what led to the fall of P.W. Botha in South Africa and led to Nelson Mandela’s freedom.

“It was critical in all those cases to have voluntary business blockades work in tandem with economic sanctions, so the people can hear that they are becoming pariahs and things are not what their leaders are telling them. … It’s a much tighter circle when the whole global economy takes part.”

Koch, the Wichita, Kan., company run by billionaire Republican megadonor Charles Koch, was explicit about its intention in a statement last week signed by Chief Operating Officer Dave Robertson . The Robertson statement said Koch would continue to operate its two Russian glass facilities, which are owned by Guardian Industries, a company acquired in 2017.

“While Guardian’s business in Russia is a very small part of Koch, 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 (which is what The Wall Street Journal has reported they would do),” Robertson said.

See: Koch Industries breaks silence on Russia operations — and says it will continue to operate its two glass factories there

The executive acknowledged the “horrific and abhorrent aggression against Ukraine,” which he called an “affront to humanity.”

But that was not enough to persuade Koch to pull out of Russia, as Ukrainian President Volodymyr Zelensky urged companies to do when he addressed the U.S. Congress by video link last week.

“All American companies must leave [the Russian] market immediately because it is flooded with our blood,” Zelensky said.

See also:   Facebook, Google, Amazon and more marked Black History Month with fanfare — after donating to lawmakers who blocked voting-rights bills

Sonnenfeld described the Koch statement as “pathetic” and said it “reveals that all they care about is the loss of assets.”

He was also scathing toward SC Johnson, describing its decision to continue operating in Russia as providing “globally branded confidence” to Russia’s war machine.

SC Johnson said in a statement that it feels a “deep obligation” to stand by its 200 workers in Russia and 130 workers in Ukraine.

“We’re not going to turn our backs on our people in Russia,” the Racine, Wis., company’s chief communications officer, Alan VanderMolen, told MarketWatch. “We believe we have an obligation to provide them with a livelihood and will continue to do so as long as we are complying with sanctions and the law.”

/zigman2/quotes/214109260/composite
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June 30, 2022 4:00p
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