Long stories short
- Lviv came under Russian missile attack for the first time since the invasion, when rockets hit a maintenance building near its airport.
- Unions condemned Dubai-owned P&O Ferriesâ€™ sacking of 800 workers as one of the â€śmost shameful acts in the history of British industrial relationsâ€ť.
- Veronika Belotserkovskaya, a Russian celebrity chef, was accused of spreading false information after telling her 900,000 Instagram followers Putin was making â€śmincemeatâ€ť of Russian soldiers.Â
Invaded: Voicemails from Ukraine
â€śMy grandfatherâ€™s house was shelled today and it was completely destroyed by Russians. My aunt who was living there managed to survive, and now she has to walk by foot to another village to our relatives because she doesnâ€™t have a home anymoreâ€¦â€ť Invaded: Voicemails from Ukraine.Â
Household names from the FTSE 100 with a combined market value of at least ÂŁ780 billion are continuing to conduct business with Russia three weeks into the war.
BT, AstraZeneca, Relx and Unilever are among those maintaining operations in Russia despite sanctions designed to isolate the Russian economy and bring the fastest-possible end to the fighting. Only 13 companies on the index explicitly condemned Russiaâ€™s actions.
Twenty-three other FTSE names including HSBC, Coca Cola HBC and Burberry â€“ nearly a quarter of the index â€“ failed to respond at all to repeated requests for comment. They were approached as part of a comprehensive Tortoise survey of Britainâ€™s biggest businessesâ€™ response to the Russian invasion.
Companies with no plans to pull out include:
- Relx, an academic publisher, which has â€śaround 100 peopleâ€ť in Russia but did not set out any plans to withdraw from the country;
- Mondi, one of the worldâ€™s biggest paper and packaging companies, which employs 5,300 people in Russia including 4,700 in the city of Syktyvkar, where it runs a power station that provides heat and warm water for 60,000. Mondi says itâ€™s â€ślegally required by the Russian authorities to provide the energy supplyâ€ť;
- Smith & Nephew, the medical technology company, which says it will continue to provide products in Russia in order to meet patientsâ€™ â€śessential medical needsâ€ťÂ (AstraZeneca similarly says it is continuing to provide â€ślife-savingâ€ť medicines to customers in Russia who rely on them);
- the Royal Mail, which says it has an obligation to deliver mail to Russia as part of its agreement with the Universal Postal Union, a specialised UN agency that coordinates postal policies among member nations;
- commodities giant Glencore, which has yet to announce an exit strategy from its equity stakes in Russian energy companies En+ and Rosneft, saying it is â€śreviewingâ€ť all business activities in the country;
- Pershing Square Holdings, with stakes in Starbucks and Hilton hotels, which explicitly refused to comment or disclose any changes to its business.
Diageoâ€™s Russian office was open when we phoned yesterday, although it has suspended distribution of its products. Unilever is continuing to provide â€śessential goodsâ€ť to Russian customers. BT has stopped sales of new products and services but has not set out a plan to withdraw existing ones or cut short contracts.
Giles Gibbons, CEO and Founder of Good Business, says pressure from companies is essential to shortening the war. Many businesses are doing the â€śobvious and easy thingâ€ť by giving to charity, he says, but â€śthe fundamental responsibility of an organisation is how it does its business, not who it gives money toâ€ť.
We approached every member of the FTSE 100 with a list of questions on their response to the invasion, including whether they have offices, investments or operations in Russia; whether they plan to stop taking on new Russian business; and whether they support efforts to prosecute the invasion of Ukraine as a war crime at the ICC.
Of the 77 companies that responded, 44 had offices or other business in Russia such as supplier or sales relationships. Of those, 31 said they were pulling out of the country in some way, but 20 said they would continue to hold a presence in Russia or hadnâ€™t yet taken action.Â
Withdrawal plans vary widely on points of detail:Â
- The drinks giant Diageo released a statement saying it has â€śpausedâ€ť exports to Russia.Â
- Unilever and Reckitt, consumer goods companies, have paused some of their sales and advertising in Russia, but continue to provide â€śessential goodsâ€ť in the country. Unilever says it will not â€śprofit from our presence in Russiaâ€ť.
- InterContinental Hotels Group has suspended future investments in Russia, but maintained existing franchise agreements with the companies that own its hotels in Russia.
Others have taken a hardline approach. BP announced plans to sell a ÂŁ25 billion stake in the Russian oil giant Rosneft, saying â€śmilitary action represents a fundamental changeâ€ť for the business, and the relationship â€śsimply cannot continueâ€ť. The move will have a significant impact on BPâ€™s bottom line; Rosneft delivered a fifth of the companyâ€™s total profits last year. Fellow oil giant Shell and British American Tobacco were among the companies with similarly hard exits.Â
The language used by FTSE 100 companies is revealing. Many expressed sadness, shock or concern for those in Ukraine, but most fell short of criticising the invasion. Sixteen said a primary concern was the welfare of their employees â€“ often referring to Russian employees as well as those in Ukraine. Twenty said they would be donating in some way.
Analysts see two schools of thought in the corporate response. One of them says ordinary Russians arenâ€™t to blame for Putinâ€™s recklessness, and nothing businesses say about it will influence his behaviour.Â
â€śOn the other hand,â€ť Gibbons says, â€śif we donâ€™t use all the tools we have to make the Russian population aware of what their leader is doing, then nothingâ€™s going to changeâ€ť.Â
Evraz and Polymetal, two UK-listed companies that operate mainly in Russia, have seen sanctions crippled their operations and board members quit in droves. Both have been barred from the FTSE as of next week; neither responded to requests for comment.
This story has been amended to clarify that Diageo has suspended distribution of its products in Russia.
Nazaninâ€™s homecoming could be part of something bigger
The official, and implausible, line from the British and American governments has always been that the talks in Vienna to revive the Iran nuclear deal, and the negotiations to release UK and US hostages, are completely separate. Occasionally thereâ€™s been an accidental outbreak of truth-telling â€“ as in January when the US Special Envoy for Iran, Robert Malley, said, â€śI will say it is very hard for us to imagine getting back into the nuclear deal while four innocent Americans are being held hostage by Iranâ€ť â€“ but generally the fiction has held.
So what can we learn, or infer, about the state of the Vienna talks from the release of the two British hostages, Nazanin Zaghari-Ratcliffe and Anoosheh Ashoori; and, just as importantly, from the continued detention of another British citizen, Mehran Raoof, and the British-American Morad Tahbaz?
CAPITALÂ ECONOMY, BUSINESS AND FINANCE
Say it ainâ€™t so P&O
There are two ways of looking at P&O Ferriesâ€™ extraordinary and unexpected decision to sack virtually its entire staff and replace them with others hired by an agency. One is that its business model is failing â€“ it claims to have lost ÂŁ100 million last year â€“ and it thinks it can save money with new people. The other is that its ownerâ€™s principal investor, Sheikh Mohammed bin Rashid al-Maktoum, has developed a grudge against the UK after the High Court ordered him last year to pay his estranged wife ÂŁ550 million for her familyâ€™s security and maintenance. The Sheikh is the ruler of Dubai. Princess Haya Bint Al-Hussain, the youngest of his six wives, fled the city for London in 2019 saying she feared for her life. This much is clear: the lives of 800 P&O staff were turned upside down yesterday by a four-minute video message many of them did not even see. The shadow transport secretary said it was beneath contempt. It may also be an act of corporate self-harm because neither staff, unions or government seem to have been consulted. Employment lawyers are circling.
CULTURE soCIETY, IDENTITY AND BELONGING
Mark Meadows, Donald Trumpâ€™s former chief of staff, is under investigation in North Carolina for suspected voter fraud. The investigation began after allegations raised by the New Yorker that Meadowsâ€™ registration seemed suspect: he listed his legal residence as a mobile home he rented for several months but appeared never to have visited. Lying on a voter registration form is a felony that Meadows tried to use to change the course of history â€“ he was among the chief architects of Donald Trumpâ€™s attempt to overturn the results of the 2020 election, and claims of â€świdespread voter fraudâ€ť were a central strategy of the campaign.Â
TECHNOLOGYÂ AI, SCIENCE AND NEW THINGS
As soon as Germany said it would be spending an extra â‚¬100 billion on defence, the question arose what that might buy. One answer seems to be a few F-35s, or even a few squadrons. At a unit cost of around $78 million excluding service contracts that will entail sharp intakes of breath in the Bundestag and German finance ministry, but economies of scale mean F-35s are now actually cheaper than some European alternatives like the Typhoon and Franceâ€™s Rafale F4.2. And the geopolitical significance of buying American is hard to overstate. Nothing evokes Cold War atlanticism more than US fighters on German runways, except perhaps US nukes on British submarines. And those Lockheed service contracts â€“ which are mighty expensive and completely essential because F-35s are so temperamental â€“ have been described as Americaâ€™s answer to Chinaâ€™s Belt and Road Initiative. These are ties that bind.
The 100-year lifeÂ health, education AND GOVERNMENT
As most eyes are trained on the refugee crisis on Ukraineâ€™s borders, the BidenÂ administration is preparing for a mass migration event on the US-Mexico border as Covid measures which have stopped over a million asylum seekers crossing are due to end. Axios has theÂ scoopÂ on the formation of a Southwest Border Coordination Center â€“ an interagency â€śwar roomâ€ť that will manage the 170,000 people expected to attempt to enterÂ the US. Title 42, WW2-era provision of federal immigration law, was invoked by Donald Trump at the start of the pandemic to force migrants back into Mexico without considering their asylum applications, to prevent infectionÂ spreading. Biden has a fine line to tread between placating Democrats who have called the use of Title 42Â cruel, and overwhelming already stretched resources on the border.Â
covid by numbers
1 billion â€“ vaccine doses produced globally each month
Our planetÂ CLIMATE AND geopolitics
The Goldberg variation
The Guardian has a must-read long read by Chris McGreal on Phil Goldberg, a US lawyer who runs a pressure group called the Manufacturersâ€™ Accountability Project (Map). Map has little to do with manufacturing and a lot to do with undermining environmentalistsâ€™ lawsuits against Big Oil. Such suits have spiralled in number in the past 10 years and collectively aim to deliver the kind of punch to the fossil fuel sector that class action lawyers delivered to Big Tobacco in the 1990s. Most are based on the argument that Big Oil knew its products caused global warming but for decades deliberately muddied the science. Goldberg says climate litigation has no legal foundation and isnâ€™t the way to fight climate change anyway. Probably best to follow the money, as McGreal does. Much of Mapâ€™s comes from fossil fuel interests. But he is exploiting a difference between tobacco and oil that climate litigants are going to have to deal with: the world is dependent on oil in a way that it never was on cigarettes.
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Additional reporting by Barney Macintyre, Ellen Halliday, Luke Gbedemah
Photographs Andrea Carrubba/Anadolu Agency, Adel Senna/AFP, Christopher Furlong/Getty Images, Brandon Bell/Getty Images