Abstract

“Stand on the Right side of History” – Multinational Corporations and the Russia-Ukraine War
Since the beginning of Russia’s invasion of Ukraine on February 24, 2022, the multinational corporations (MNCs) operating in Russia have been facing challenges rarely dealt with at business schools. They face ethical dilemmas and feel strong pressure from their shareholders and stakeholders, forcing the executives to make decisions that go well beyond usual business thinking and strategizing. Thousands of companies have decided to divest, withdraw, or scale down their operations in Russia. In contrast, others justify their decision to stay with their responsibility towards their employees in Russia and their unwillingness to deprive Russia’s population of essential goods such as food and medical supplies. President Zelensky was one of the many voices arguing that deciding to stay or leave is more than just a business issue and that companies should “signal that they are on the right side of history.” But what is the “right side of history”? Is it just pathetic wording, or does history matter?
This paper will address the following research questions: How and why can some companies benefit from war while others suffer disruption and destruction in their production and distribution networks? How does public pressure affect corporate behavior and reputation? What does (business) history teach us about ethical behavior in times of war? To provide an answer, I will provide a summary of the economic sanctions and self-sanctions (since 2014). Then I will present the variety of forms of public pressure put on the MNCs operating in Russia (based on content analysis of social media and interviews with the activists). Next, I will describe the types of corporate responses to public pressure. Finally, by comparing the current war with the Anti-Apartheid campaign in South Africa and the Palestinian Boycott, I will present my observation regarding the (un)ethical behavior in times of war.