Mondelēz International continues reduced operating within Russia

Mondelēz International has confirmed it intends to retain its commercial presence in Russia amid the ongoing war with Ukraine, noting that it wished to continue supporting its existing employees and wider communities in the region, reports Neill Barston.

The company’s decision comes in the wake of a number of major corporations withdrawing from the country across industries, including confectionery businesses, as the conflict approaches its 18-month mark.

Notably, Mondelēz, which has 3,000 staff working in Russia, has adopted a similar position to Nestlé, which recently stated that it intends to continue its food operations within Russia, on a reduced basis, with the business employing 5,500 people in the region.

According to latest national news reports, conditions in the region have continued to intensify, with the UK’s Daily Telegraph this week reporting that Ukraine had made gains in several areas in counteroffensive moves.

Issuing a statement on its policies, Mondelēz explained that it had continued its support for Ukraine with a dedicated international fund supporting refugees from the company.

It said: “Since the beginning of the war, we have condemned this brutal aggression against Ukraine. Our thoughts remain with all those around the world with family, friends, and loved ones who have been impacted. We are constantly supporting our colleagues in Ukraine and have invested in repairing and rebuilding our local manufacturing facilities which have now returned to operations. To help the Ukrainian people, we have continued to increase our now $15 million commitment via the Mondelēz International Foundation to support the country, Ukrainian citizens as well as refugees, with cash and in-kind contributions.

“There are no easy decisions, but, like most other global food and beverage companies, we are continuing to provide food during these challenging times, focusing our operations in Russia on affordable, shelf-stable products that are daily staples for ordinary people.

“If we suspended our full operations, we would risk turning over our full operations to another party who could use the full proceeds for their own interests. It would mean cutting off part of the food supply for many families who have no say in the war. It would also create great uncertainty for our ~3,000 colleagues and more than 10,000 farmers who depend on us.”

The company added that it had scaled down its activities, discontinuing new capital investments, new product launches, as well as advertising media spending in Russia. Consequently, it confirmed that it is selling ‘significantly less’ products in the country, and its sales are correspondingly declining.   It noted that in 2023, its overall volumes have dropped by double digits, which is reflected in a reduced market share.

The company added: “We’re continuing to reduce our activities and expect further volume and sales declines as we work to make our Russia operations self-sufficient. We plan to have the Russia business stand-alone with a self-sufficient supply chain before the end of the year.”