© Reuters. FILE PHOTO: People enter a McDonald’s restaurant in Moscow, Russia April 24, 2018. REUTERS / Tatyana Makeyeva / File Photo
By Hilary Russ
NEW YORK (Reuters) – McDonald’s Corp said on Tuesday it will temporarily close all of its 847 restaurants in Russia, increasing pressure on other global brands to halt operations in the country. after Moscow invaded Ukraine.
The closure of McDonald’s (NYSE:) restaurants will also take on symbolic significance in Russia, where the first location to open, in central Moscow in 1990, has become an iconic symbol of its flourishing. American capitalism when the Soviet Union collapsed.
McDonald’s said it will continue to pay the salaries of its 62,000 employees in Russia. Due to its large size and global reach, the chain is often copied by other companies if they take a stance on an issue or make a major change in operations.
“If they decide to do something, then maybe others will follow,” said international franchising consultant William Edwards during a company conversation about whether to pull out of Russia for reasons of reason. ethical or not.
Major global brands, including McDonald’s and PepsiCo (NASDAQ: Inc.), have been pressured by several agencies, including the New York state pension fund, to suspend operations in Russia.
Russia called its actions in Ukraine a “special operation.”
McDonald’s opened in Pushkin Square 32 years before the fall of the Soviet Union. That new restaurant represents Cold War tensions that are thawing at a time when some young Russians are yearning for blue jeans and other Americana.
“It is impossible to predict when we might reopen our restaurants in Russia,” McDonald’s CEO Chris Kempczinski said in a note emailed across the company on Tuesday and posted. on the company’s website. “We are experiencing disruptions to our supply chain along with other operational impacts. We will also closely monitor the humanitarian situation.”
Of the nearly 850 establishments in Russia, 84% are company-owned and the rest are mostly operated by a Moscow-based franchisor, Rosinter Restaurants Holding.
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