PepsiCo and Mars have been slammed by Ukraine and placed on its “international sponsor of war” file, joining several other major food companies.
Ukraine’s National Agency for the Prevention of Corruption (NACP) has updated its list to include both the Lay’s maker and Mars chocolate owner.
The agency slammed both major businesses for their presence in Russia.
It wrote: “Despite the declaration of reduction of their business, cessation of advertising activities, and production of their products, they continue to work in the Russian Federation, paying significant taxes to its budget, thereby supporting the economy of the aggressor country.”
In March 2022, PepsiCo announced the cessation of advertising activities and the production of beverages in Russia in connection with the full-scale invasion of Russia into Ukraine.
However, NACP reported that PepsiCo increased its revenues in the Russian Federation in the first year of a full-scale invasion.
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Its Russian operations reportedly turned over $2.59bn in 2022 while net profit increased by 333% to $525m compared to 2021. Over $115m of taxes were paid to the budget of the Russian Federation, according to the Ukrainian agency.
NACP added that the company also continues the production and distribution of chips, snacks and dairy products. According to “information from the media”, PepsiCo’s Lay’s chips were found in the food rations of Russian soldiers.
“The absence of sincere intentions to leave the Russian market is also indicated by the fact that more than 580 open vacancies in the Russian Federation are listed on the company’s career page. By creating jobs, foreign companies free the Kremlin from the burden of unemployment benefits and related social problems.”
The Ukraine agency stated that PepsiCo has been operating in Russia since 1974, has 19 factories, about 20,000 employees and 40,000 agricultural workers.
Meanwhile, Mars has reportedly been working in Russia for more than 30 years, invested $2.5bn in the country’s economy, created more than 6,000 jobs and operated ten factories in Russia.
The company promised to reduce business on the territory of the Russian Federation after the outbreak of the war. “Any profit from Russian business will be used for humanitarian purposes. The company will not import or export products”, Mars’ official statement said.
NACP said: “Factories continue to operate in Russia with increased revenues in 2022 compared to 2021. The turnover of LLC “Mars” for 2022 grew to $2.45bn, the net profit increased by 59% to $377m, taxes were paid to the budget of the Russian Federation for more than $93m.”
Mars and PepsiCo were ranked in the top ten of companies making the largest revenue gains in 2022 in a report by B4Ukraine.
Just Food has approached both companies for comment.
In July, Unilever was also added to the list due to its ongoing presence in Russia. NACP added that the Ben and Jerry’s owner’s profits in Russia doubled from 2021 to 2022.
A month prior, Mondelez International was forced to defend its presence in Russia after reportedly seeing customers in Norway say they will stop stocking its products.