Despite the ongoing Russia-Ukraine war, a concerning number of Western companies still remain active in the Russian market, contributing to its economy. In a previous discussion, we talked with Yale professor Sonnenfeld about why companies should leave the Russian market. Today, we will discuss what actionable steps consumers can take to influence the corporate behavior of such companies and promote ethical business practices.

PissedConsumer spoke with Dmitry Abramson, a political activist, who shares his ideas on how consumers can use their power to drive change by making informed choices and stop sponsoring the war in Ukraine. He also explores the future of business activities and the consequences that companies still doing business in Russia may have. 

Here are the points discussed in the video interview with our political expert.

About Dmitry Abramson

Dmitry Abramson: I call myself a political activist. I've been presented as a blogger or a political observer. So, I was a political activist in the United States. I left Ukraine over 29 years ago. But when the war broke out, I realized I couldn't stand aside and must get involved in any way I could. At the time, it was over a year ago, and one of the ideas that I had was to make sure that Western businesses exit Russia as much as possible.

Because when they stay and operate in Russia, they pay taxes to the Russian government, which allows the Russian government to finance the illegal aggression, the illegal war against Ukraine. 

How to Boycott Companies That Still Do Business in Russia

Dmitry Abramson: The way to do it, at the time at least, was two parts. One is to identify those companies and write them a letter, basically threatening them, advocating, or threatening. However, you choose to position it by telling them they should exit the market, the Russian market, and the Russian economy. And if they don't, we will stop buying their products.

And the effectiveness of the letter is that this is not abstract; they can't ignore it. Their customer service, or whoever is in charge of this, is getting those letters. They have to read them. They have to respond at least, almost mandated to respond with something. And it gets registered within those companies. Whether it was going to be effective or not was a big question at the time.

And the second part, of course, is to become a socially conscious consumer. In many ways, it doesn't have to be just Ukraine, but in this case, it had to be about Ukraine, become a conscious consumer and stop purchasing products from those companies, and actually follow up on the threat.

So, that was the idea about a year ago. When I looked a year later, I realized that the strategy to this point hadn't worked. Obviously, I'm just one person. I advocated for this as much as I could. I'm sure there were others doing the same thing. But a lot of companies still remain in Russia today. And they find all kinds of excuses and justifications for doing it, or sometimes they do it without any explanation. And I decided I wanted to revisit this subject and see what else we could do and how we should approach this.

Michael: So, do you recommend consumers start writing letters they have learned that still operate in Russia? Do you think if we do it in volume, it would help?

Dmitry Abramson: As the saying goes, don't make predictions, especially about the future. But it has a lot to do with how this war ends. And most likely, Russia is not going to become a democratic country with human rights anytime soon. I think the opposite. This war is forcing Russia even deeper into authoritarianism, and they're going to be separated from the world even more over time. So, I don't see companies that have exited Russia coming back. 

I think there's going to be even further separation between the Russian economy and the rest of the world. Now, those companies that stay will eventually be forced to leave. It's going to be too late at that point in terms of helping stop the war. So, I think they are damaging their image. I suspect that the same companies that refuse to leave Russia, meaning they put their financial interests above everything else, they're probably the same companies that have a low ESG score.

In other words, they probably have issues in other areas outside of Ukraine, having to do with the environment, social issues, and governance. And unfortunately, that area of our marketplace, I guess, is not well developed. I would like to have each company reliably scored on the ESG score. But unfortunately, I haven't seen anything that covers the whole market or that I can really trust. That is something I would be looking for in the future. This would help consumers to consistently support and buy products from companies that have a very high ESG score as opposed to a low ESG score.

Tips on How to Stop Sponsoring the War in Ukraine

Michael: I am also a consumer of products. In a European Deli that used to be called Russian Deli, as you very well know, I witnessed at the beginning of the war a fight where one person was actually screaming at the store manager to remove all the products, all the Russian-made products from the shelves. And yet they're still there. 

At this point, you spoke about your side where you were writing letters to customer service. 

We, as PissedConsumer, were writing letters to the PR and marketing departments of the companies. What we are doing as a website is we are highlighting on our website pages the companies that still operate in Russia. So, as you visit PissedConsumer, you can see those companies that we were able to find, that we have proof of, marked as businesses still operating in Russia. 

What other creative ways can you think of, if any, to persuade world corporations to stop doing business in Russia?

Dmitry Abramson: I think it has to be public pressure at this point. If they haven't done it before for reasons like ethical and moral reasons, if they haven't done it previously to at least protect their image and protect their brand, there would have to be more public pressure and financial consequences. That is the only thing that's going to work for those who still haven't left the Russian economy. 

The problem with boycotts or public pressure that I think I've identified a year later is that it's not easy to organize all the consumers. Even people who care, as you said, you had a poll where most people said, 'Yes, they're willing to pay more.' It's still difficult to get them from. I'm willing to pay more for the actual change in their buying habits. And there are several problems that we can talk about.

One is that the boycotts don't work because there are not enough people doing it, not enough discipline, not enough perseverance actually to try to see it through. So, the way I think to approach this is not to try on an individual level, not to try and boil the ocean. You can't physically. Everybody has their own lives. You just physically can't. You don't have enough time in the day to overnight switch. 

Dmitry Abramson: First of all, do all the research and then switch to all the brands that don't work in Russia. Don't do business in Russia. It's a lot of work, but you should try and do it every time you have a chance to do it. Maybe one brand per day, maybe one category of a product that you can attack a week, whatever you're comfortable with. And it involves some work.

It's not always about money. I mean, like you said, they're willing to pay more. It's not always that you have to pay more. It's that you have to invest time. I mean, there are brands that I've been buying for 20 years. Now, I have to revisit this, do the research, and make sure they exited the Russian market. A lot of them did not because they're probably the most popular brands in the United States, consumer staples, and consumer products. And then, do some research and find an alternative. Then there will be scenarios where you will easily find a good alternative, actually better, and you will say, why didn't I do this before? Because the product is better and cheaper, and I should have done it a long time ago.

But there are other categories of products where you come to the store, and virtually everything in that category is manufactured by companies that haven't exited Russia. So, that becomes a more challenging proposition. And I can go through some examples of what consumers could actually do and how they could do it. But there are multiple steps, and again, my advice would be, don't try to boil the ocean one step at a time, and together, we'll get there.

What Is the Future of Companies That Stay in Russia?

Michael: So you're bringing up a very interesting point: the company that has not exited Russia right now will still be forced to leave Russia. It'll be a little bit later. So the CEO of that company is probably thinking, well, it's going to boil over. We spent an enormous amount of money 30 years ago trying to penetrate the Russian market back. I don't want to go through that again right now. So, I'll just stick around and see how it goes. The war will be over, and I already have the market. I don't have to worry about it. 

But what you are saying is that you are putting a different side of the metal, which is that you're staying in Russia now, still staying in Russia. Every day, you generate rubles or dollars in taxes to Russia. You are tarnishing your brand image today, and most likely, it'll tarnish that brand image for years to come. You know very well for many, many years, a lot of people would not buy German cars after the war. It took years upon years for some consumers to start buying German cars because of the World War.

Dmitry Abramson: Something like this could happen here. They're a little bit removed from it. They think they're removed because they're only paying taxes, right? They're not Russian businesses. But in our day and age, the age of social media, when everything is basically known, I don't think they're going to be able to escape. And again, this is a problem with the company's management and executives. They're thinking short-term. It's called short-termism. They want to meet the revenues next quarter and then the next quarter and then the next quarter. They are not thinking strategically. And they're not thinking long-term. I think if they did like some other companies, they would've exited the market. And by the way, some companies lost money. There's no question about it. They lost money exiting the market, but they went on principle.

Michael: I saw a news article somewhere that that loss was very short for corporations that exited last year. The loss was very minimal in terms of stock prices, and then it recovered.

Dmitry Abramson: Obviously, multinationals like Proctor and Gamble and Russia cannot be more than a small percentage of... I don't know the exact numbers either, but they can't be more than a small percentage of their total revenue. But the managers responsible for it have to meet their goals or whatever their financial goals are. It trickles down to individual directors and managers responsible for regions and countries, and they've made a decision: Hey, we can still make money here. We made the investment here. We don't want to lose. We don't want to leave. And they might be. You're right; they might be thinking that this is going to blow over, that they're going to come back, and everything is going to be fine like nothing happened, and we can't make them right. We have to continue the pressure because, unfortunately, as I said, it's been over a year, and they're still there, and they're still operating, and they're still not suffering enough consequences.

And what we're talking about here is, ultimately, only if they realize that they're losing more money around the world than they're making in Russia. Only then the financial pressure is going to force them to exit. So, the real question is, how do we make it happen? How do we make it so that they understand they're going to lose and they are losing more than they're making in Russia?

What Are the Consequences of Doing Business in Russia?

Michael: Some CEOs of Procter and Gamble say, "Our shaving blades are not attributing to the war. We are just helping normal Russians to shave, and we are not supporting Putin the regime." How would you tell them that they're wrong? How would you tell those CEOs that it is a proper and conscious decision? How would you explain it to them?

Dmitry Abramson: Right now, I'm looking at the article by Novaya Gazeta in Europe, and they're listing the worst 15 companies whose profits increased in Russia after the war started. And the ones that, there's a lot of petroleum and some international banks I'm not familiar with and tobacco companies, but there is Pepsi, there's Mondelez, there's Mars, Kia, there's Proctor and Gamble, right? So they're actually making more money. There is an argument to be made that they're making more money on the war than they did before, either because other businesses exited or for some other reason, but they actually. I would say it's blood money.

The CEO... So what could it be? I'm trying to predict their counterarguments. They would say, Look, we are selling; it's not people's fault. We're selling basic stuff that, like you said, Gillette shavers or liquid detergent, basic stuff that people need. Why do they want to punish regular people for something their government is doing? And there is a big philosophical debate about how much every person is responsible for what's going on. I don't want to get into this, but ultimately, it comes down to you paying taxes without getting into this part. The Russian government can then take the money, turn around, buy more weapons, manufacture more weapons, and generally support their economy so that they don't feel the consequences of the war as much while they are bombing Ukrainian citizens and destroying their country, destroying their cities, and committing war crimes. That would be the argument.

But like I said, unfortunately, if that argument didn't work for them for more than a year, I think they're only interested in money, maybe publicity. They're interested in their brand image, which will ultimately lead to a loss of money. So, that's the only thing I think is going to work on them at this point.

Michael: We've had Dmitry Abramson at the show today. We are interested in hearing your opinions, so please take some time to write to us your comments. How do you feel about boycotting brands that still operate in Russia? Thank you for your time. 

Dmitry Abramson: Michael, thank you for the invite. It's a very important topic. I'm very happy that your company and you personally are so much involved in this. I think you can really make a difference.

In this interview, Dmitry Abramson provided insights into what significant impact consumers can have on companies doing business in Russia. What are your thoughts on this approach? Please share your opinion in the comments. Don't forget to subscribe to our YouTube channel to follow updates on experts' videos. 

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