McDonald's pausing Russia operations, temporarily closing restaurants
McDonald's has 847 restaurants in Russia, employing approximately 62,000 people.
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McDonald's will pause operations in Russia, including temporarily closing all of its restaurants in the country, in response to the ongoing invasion of Ukraine.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MCD | MCDONALD'S CORP. | 275.07 | +7.12 | +2.66% |
"We understand the impact this will have on our Russian colleagues and partners, which is why we are prepared to support all three legs of the stool in Ukraine and Russia," McDonald's CEO Chris Kempczinski said in a message to employees and franchisees. "This includes salary continuation for all McDonald’s employees in Russia."
MCDONALD'S, PEPSICO URGED TO CEASE RUSSIA OPERATIONS BY NY PENSION FUND
McDonald's has a total of 847 restaurant locations in Russia and 108 locations in Ukraine. The fast food giant owns 84% of its Russia locations and 100% of its Ukraine locations. The Russia locations employ approximately 62,000 people.
Russia and Ukraine combined represented approximately 2% of the company's system-wide sales, roughly 9% of its revenue and less than 3% of its operating income in 2021.
FILE PHOTO: People enter a McDonald's restaurant in Moscow, Russia April 24, 2018. REUTERS/Tatyana Makeyeva/File Photo
"As we move forward, McDonald’s will continue to assess the situation and determine if any additional measures are required. At this juncture, it’s impossible to predict when we might be able to reopen our restaurants in Russia," Kempczinski added. "We are experiencing disruptions to our supply chain along with other operational impacts. We will also closely monitor the humanitarian situation."
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McDonald's emphasized that Ronald McDonald House Charities will continue its full operations in Russia.
RMHC Ukraine has been deploying medical supplies and providing humanitarian aid throughout the country and RMHC's Poland Care Mobile is at the Polish-Ukrainian border to provide medical care and humanitarian aid for families and children. In addition, another Care Mobile is on the way from RMHC Latvia.
McDonald's continues to pay full salaries for its Ukrainian employees, has donated $5 million to its employee assistance fund and continues to support relief efforts led by the International Red Cross in the region.
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McDonald's move comes after calls for a boycott against the company gained steam on social media over the weekend.
In addition, New York State's Common Retirement Fund, one of the largest public pension funds in the U.S., sent a letter to the company warning that they face "significant and growing legal, compliance, operational, human rights and personnel, and reputational risks" over its continued operations in Russia.
"Pausing or ending McDonald’s business operations in Russia would address various investment risks associated with the Russian market and play an important role in condemning Russia’s role in fundamentally undermining the international order that is vital to a strong and healthy global economy," the fund's trustee, New York State Comptroller Thomas DiNapoli, wrote in a letter to Kempczinski reviewed by FOX Business.
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| MA | MASTERCARD INC. | 456.98 | +1.49 | +0.33% |
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| NSANY | NISSAN MOTOR CO. LTD. | 7.1055 | -0.56 | -7.36% |
Other companies that have suspended Russia operations in recent days include Shell, Visa and Mastercard, American Express, Estee Lauder, Airbnb and Nissan.