Nestlé has reacted to weekend criticism by Ukrainian President Volodymyr Zelensky over the Swiss food giant continuing to do business in Russia, albeit on a scaled-down basis.
Speaking via a remote address to a rally outside the Swiss parliament in the capital of Bern on Saturday (19 March), Zelensky urged Nestlé to halt business in Russia and encouraged Swiss banks to block funds held by Russian elites.
“We do not make a profit from our remaining activities [in Russia],” a Nestlé spokesperson responded in a statement.
Some multinational food manufacturers have ceased operating in Russia since the country’s forces entered Ukraine on 24 February.
Others, including Nestlé, have stopped capital investment in Russia but continued to supply what they deem to be food essentials.
Kellogg, the US-based cereal maker, also continues to supply essentials such as cereal and biscuits, while food and drink peer PepsiCo has maintained the supply of milk, baby foods and formula, while stopping sales of key drinks brands.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
Mondelez International, another US food business, continues to trade in Russia for “basic offerings”, although it has scaled back activity, while Italian business Barilla has continued with pasta production.
Nestlé has also halted exports and imports to and from Russia but is still supplying baby food, breakfast cereals, “tailored nutrition and therapeutic pet foods for specialist retailers and veterinarian clinics”.
The Nestlé spokesperson said: “We have significantly scaled back our activities in Russia – we have stopped all imports and exports from Russia, except for essential products. We no longer make investments or advertise our products. We do not make a profit from our remaining activities.
“The fact that we, like other food companies, supply the population with important food does not mean that we simply continue as before.”
Nestlé defended its position as it seeks to ensure the safety of its employees in Russia, while also endeavouring to support people in Ukraine.
“In terms of what has driven the decision – providing a reliable supply of essential food to the local population and a duty of care to 7,000 employees in the country [Russia] – we would not want to leave those colleagues at the mercy of the government and authorities.
“At the same time, we are doing whatever we can in Ukraine and neighbouring countries to help alleviate this humanitarian catastrophe. Our colleagues in Ukraine are doing everything they can to help the population with food donations. We are still one of the few active food companies in Ukraine and sometimes even manage to distribute food in Kharkiv.”
As well as Zelensky’s criticism on Saturday, other senior Ukrainian officials have also attacked the world’s largest food maker.
Ukraine’s Prime Minister, Denys Shmyhal, said he had spoken to Nestlé CEO Mark Schneider. “Unfortunately, he shows no understanding. Paying taxes to the budget of a terrorist country means killing defenseless children&mothers. Hope that Nestle will change its mind soon,” Shmyhal tweeted.
Talked to @Nestle CEO Mr. Mark Schneider about the side effect of staying in Russian market. Unfortunately, he shows no understanding. Paying taxes to the budget of a terrorist country means killing defenseless children&mothers. Hope that Nestle will change its mind soon.— Denys Shmyhal (@Denys_Shmyhal) March 17, 2022
Posting on Telegram, Podolyak wrote: “It is these companies that are now happily sitting in Russia, paying taxes, supplying food there, and simply rejoicing that the Russians are using this money to brutally bomb our cities and kill our people.”