We will continue to provide updated information on a bi-weekly basis

Prepared by the KSE Institute team and KSE members of the Board of Directors with the support of the International Renaissance Foundation; 16.10-01.11.2023.

Disclaimer: At the beginning of the Russian invasion of Ukraine KSE Institute launched an analytical project, which was named “SelfSanctions”, aimed to collect data on foreign companies operating in the Russian market and limiting or terminating their activities. Examination of data was conducted jointly with specialists from the Ministry of Economy, the Ministry of Foreign Affairs and the Ministry of Digital Transformation of Ukraine. The database contains a lot of information, we collect daily statistics on changes in the status of foreign companies operating/operated in the Russian market and limiting or terminating their activities. Also, we created the Telegram bot https://t.me/exit_ru_bot for tracking/monitoring of news on priority foreign companies (coverage 1, 2, 3 or 7 days of monitoring). Also, we do regular analysis of changes in share prices and capitalization of parent groups of companies that have or have had business in Russia.

KSE database is partly based on the Yale’s School of Management database, the University of St.Gallen latest Paper, epravda.com.ua, squeezingputin.com, https://bloody.energy/ and leave-russia.org websites and other open sources. Data is verified and KSE status is assigned. Data on stocks is taken from Google and Yahoo Finance. At the same time, the KSE database is more complete and comprehensive and contains much more information than most other similar databases, as it also includes data on number of staff, revenue, capital and other financial indicators, the latest updates and changes in statuses, links to used sources, and daily updates from the telegram-bot etc.

KSE Institute and Leave Russia project are the part of B4Ukraine Coalition since mid-2022.

KSE Institute is glad to announce have finalized merging with project leave-russia.org which was developed by a team of volunteers.

Also, we developed a barcode scanner, which is available here: https://leaverussia.kse.ua/ (only for mobile devices!) or in our Telegram bot https://t.me/exit_ru_bot. It allows you to find any brand or company that is operating in Russia just by scanning barcodes.

KSE DATABASE SNAPSHOT as of 01.11.2023

Number of the companies that continue Russian operations (KSE’s status «stay»¹) – 1 503 (+25 per 2 weeks)

Number of the companies that have reduced current operations and hold off new Investments (KSE’s status «wait») – 552 (+4 per 2 weeks)

Number of the companies that have curtailed Russian operations (KSE’s status «leave») – 1 215 (-6 per 2 weeks)

Number of the companies that completed withdrawal from Russia (KSE’s status “exited”) – 296 (+4 per 2 weeks)

As of November 1, we have identified about 3,566 companies, organizations and their brands from 95 countries and 58 industries and analyzed their position on the Russian market. About 40% of them are public ones, for ~1 520 public groups of companies, we also identified (where it was possible) their operating business in Russia (the presence of a controlling stake in a legal entity and revenue received) and found the data for 2021 before invasion was started, which allowed us to calculate the value of capital invested in the country (about $193.2 billion), local revenue (about $314.5 billion), local assets (about $336.5 billion) as well as staff (about 1.439 million people) and taxes paid (about $25.4 billion). 1,767 foreign companies have reduced, suspended or ceased operations in Russia. Also, we added information about 296 companies that have completed the sale/liqudation of their business in Russia based on the information collected from the official registers.

As can be seen from the tables below, as of November 1, 296 companies which had already completely exited from the Russian Federation, in 2021 had at least 491,500 personnel, $81.4 bn in annual revenue, $42.4bn in capital and $69.1bn in assets; companies, that declared a complete withdrawal from Russia had 248,300 personnel, $41.6bn in revenues, $17.0bn in capital and $28.0bn in assets; companies that suspended operations on the Russian market had 92,800 personnel, annual revenue of $24.4bn, $35.3bn in capital and $84.2bn in assets.

There are about 1’520 companies identified in the KSE database with revenue data available of more than $314 billion in 2021 and ~$234 billion in 2022. And at least 296 of them have already been sold by local companies or were liquidated and left the Russian market. In October 2023 KSE Institute identified +12 new exits, total number of exits observed since the beginning of Russia’s invasion reached 296.

On the chart below, share of exited and other statuses based on revenue-2021 allocation is shown. It is worth mentioning when we analyze status “leave” it is also worth paying attention to sub-statuses (suspension could be treated as a temporary pause in operations while withdrawal – is a clear sign of the company’s intention to exit Russia in full).

% of exited is 26% based on revenue allocation, those who are leaving represent 21% of total revenue (with 37% share of suspensions and 63% of withdrawals sub-statuses), % of staying companies represent 33% of revenue and 20% are waiting companies based on revenue generated in Russia in 2021. So we observe the situation that % of staying companies is greater than % of leaving ones (which means that less than 50% of pre-invasion revenue generated by foreigners is leaving Russia).

If we take a look at the same chart based on revenue-2022 distribution – the picture will be a bit different:

% of exited is 23% based on revenue allocation, those who are leaving represent only 15% of total revenue (with 32% share of suspensions and 68% of withdrawals sub-statuses), % of staying companies represent 47% of revenue and 15% are waiting companies based on revenue generated in Russia in 2022.

Key conclusion could be the following: on the general background of falling revenue in 2022 companies which made the decision to leave earned less than those who stayed and more companies migrated from the “suspension” sub-status to “withdrawal” showing their increased intention to cut ties with Russia.

Geography is the most important factor that explains companies’ decisions. Companies from “unfriendly countries” (a term coined by the Russian Federation to describe countries that joined the international sanctions policy against the Russian Federation in response to its invasion of Ukraine) are much more likely to exit.

Here are also the breakdowns by countries and by industries of the companies which already exited:

So, as of the end of October 2023, companies from 35 countries and 40 industries have already exited showing their true reaction to the war started by Russia and its not provoked aggression against Ukraine. Most of the companies were headquartered in the USA, Finland, Germany, Great Britain and France and operated in the “Automotive”, “Electronics”, “Consumer goods and closing”, “Energy, oil and gas”, “Finance and payments” and “Food & Beverage” industries.

For a more accurate explanation of the behavior of companies, it is necessary to take into account several factors at the same time. According to our analysis, companies in the technological and communication sector are most prone to exit (as opposed to those who remain in the Russian Federation). Partially due to the fact that they have fewer physical assets in the Russian Federation than in the production sectors. Companies that produce products for the daily consumption of the population in the Russian Federation are less likely to leave (this is one of their key explanations why they do not leave). Pharmaceutical companies that explain their decisions by concern for public health tend to be the “staying” companies.

Companies with larger local revenue and public companies are also inclined to leave the market: presumably, large multinational corporations are more responsible for their reputation and respond to investors’ requests. In addition, it is likely that the exit of the largest multinationals from the Russian Federation is not as painful for them for global business as it is for smaller companies, for which the share of the Russian market can be significant.

Here is the list of “exiters” that we were able to identify recently: Google (part of Alphabet, bankruptcy of the Russian subsidiary declared by the court), ASBIS, Carlsberg (Carlsberg prepares for fight over Russian unit’s right to sell its brands after Russia seized control of shares in Danone and Carlsberg subsidiaries), Decathlon, Ensto, Viterra (part of Glencore which stopped being Russneft’s shareholder in 2022. Sberbank tries to seize the remaining Glencore’s Russian assets over oil debt), Ingka, Legrand, Sulzer, VEON and Xerox. Also, the exit of KONE was finalized but we reported it earlier.

Additionally, we reclassified the status of ThyssenKrupp from “exit” to “wait” as in reality, local companies of this group have not changed their owners and the biggest ones were renamed probably to hide links with the parent company. Moreover, our colleagues from Squeezing Putin identified a big jump of the trade in summer of 2022, mostly attributed to the Murmansk Seaport project for the supply of the new material handling system for coal.

Most of these exits were identified before in their preparation phase. Also, we are not in a hurry to assign “exited” status to many companies that are literally on the verge of exit, although they have not yet finalized this process (even though some of them have already been nationalized, partly sold their business or initiated bankruptcy procedures).

Here are just some of them: Adidas (the Moscow Arbitration Court arrested the assets of the Russian subsidiary of Adidas for 3.49 billion rubles as part of a claim from the Dream Island amusement park), Credit Suisse (the court arrested funds in Credit Suisse accounts within the amount of the claim of Kaluga Gazenergobank – €10.12 million and $10.25 million, which are kept in accounts at Bank Credit Suisse JSC. Also, 99.9% of the shares of Credit Suisse AG and Credit Suisse Securities, owned by Credit Suisse AG, were arrested and prohibited from disposing of these shares and shares within the limits of the stated claims in the part not covered by the seizure of funds), Fujitsu (the Japanese technology corporation Fujitsu has initiated the process of liquidating its legal entity in Russia. According to the Russian registry, the record of the liquidation of the local LLC “Fujitsu Technology Solutions” appeared in August, and the company has already appointed a liquidator), IKEA (Ingka sold its Russian shopping centres to Gazprombank”s subsidiary. IKEA also did a partial sale – SIBFINANCE LLC became the new founder of the organization. The entry about the founder of INGKA HOLDING EUROPE B.V. was removed from the Unified State Register of Legal Entities. 25.10.2023: Full name changed from INGKA CENTERS RUS OPERATIONS LLC to MEGA MANAGEMENT COMPANY LLC), Rehau (REHAU examines options for exit from Russia but no approval from authorities for sale).

The next review of deals for November 2023 will be available in a month.

What’s new last month – key news from Daily monitoring

(updated on a bi-weekly basis) ⁷

Recently we made a lot of significant improvements in our Telegram-bot with improving the interface, adding overall statistics and reflecting on the latest KSE statuses of companies taken from the KSE public database.

KSE team has incredible news about the project again! We are not standing still, and in addition to supporting and developing our database, which currently contains the world’s most comprehensive information on the activities of global corporations on the Russian market, we are also developing our technical products. We developed a barcode scanner, which is available at the link https://leaverussia.kse.ua/ (only for mobile devices!) or in our Telegram bot https://t.me/exit_ru_bot! To use the scanner, you need to have a mobile phone, scan the barcode of the product in the store (or anywhere else) with a camera, and you will see information about its manufacturer and whether it also operates in Russia.

Also, thanks to the use of ChatGPT, for most companies in the consumer sector, we have created the most complete list of 7500+ major brands and trademarks, so the search has become even more convenient and better. In addition, the scanner can be saved as a regular app on the smartphone home screen and Eng/Ukr versions are available.

In July 2023, the KSE Institute, jointly with the B4Ukraine coalition partners published a new research entitled “The Business of Staying: a closer look at multinational revenues and taxes in Russia in 2022”, you can download its full text in English using the following links: https://kse.ua/wp-content/uploads/2023/07/The-Business-of-Staying-1.pdf and https://b4ukraine.org/pdf/BusinessOfStaying.pdf 

Also, in September 2023, the KSE Institute jointly with the B4Ukraine coalition partners published another research entitled “The Business of Leaving: How Multinationals Can Responsibly Exit Russia”, you can download its full text in English here: https://b4ukraine.org/pdf/B4Ukraine_Business_of_Leaving_report.pdf

KSE’s Barcode Scanner (mobile devices only)

KSE Telegram bot on news monitoring @exit_ru_bot

Twitter of SelfSanctions project

Leave-russia.org website

BI analytics @ Leave-russia.org

Company news @ Leave-russia.org

Twitter of leave-russia.org website 

LinkedIn of leave-russia.org

YouTube of leave-russia.org

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¹ – KSE status “leave” – Companies that have published on the company’s official website (or their release has appeared in a foreign publication such as FT, NYT, etc.) that are completely shutting down in Russia or companies that have officially announced that they are temporarily reducing operations in Russia
– KSE status “wait” – Companies that have published on the company’s official website (or their release has appeared in a foreign publication such as FT, NYT, etc.) that they are reducing only part of their business operations by continuing to work on other operations or companies that have reported delaying future investment / development / marketing , while continuing their core business
– KSE status “stay” – Companies that ignore exit / downsizing requirements in Russia, as well as companies that have officially stated that they remain in Russia or news of their exit have not been found
– KSE status “exited” – Companies that sold its business/assets or its part of the business to a local partner and leaved the market

² As of 19/06/2022, we updated the database with extended information on ~ + 400 new companies, and as of 28/08/2022, we have updated data for another 422 companies with data on personnel, revenue, capital and assets for 2021. Also, we started to monitor additionally whether companies really stated any actions to exit the country (currently we observe a very small number of such companies). So far we found information only about a few companies which started selling their business in Russia. Even for most of them – it’s just an intention or they just started the process of sale. Everything else is mostly the statements or some preliminary steps. The collected information is already available and systematised in the form of a newKSE’s status “exited”.

³ On 24 July 2022, we introduced the new status “exited”, which reflects the companies’ actions to finalise the exit from the Russian market. The status relies on data from the Uniform State Register of Legal Entities in Russia (USRLE or EGRUL) and complementary analysis such as companies’ announcements and media publications of company activities. At the same time, companies’ activities can be hard to track and can be missed in the analysis, especially for companies less covered in the media. We encourage our readers to inform us if they are familiar with the companies’ actions that contradict their announcements about the exit via the Feedback Form at https://leave-russia.org/

⁴ After 20 months of war started by Russia in Ukraine we assume that there was quite enough time to make the decision to leave the country-aggressor for all international business. That’s why for KSE Institute companies marked with statuses “stay” and “wait” essentially there are no significant differences.

⁵ Increase in assets vs previous data is explained by adding newly collected information on the bank’s assets which was not available before, as well as the addition of several new companies from the TOP-50 largest foreign companies rating by Forbes Russia.

⁶ It needs to be mentioned that open access to Russia’s EGRUL register was partly classified recently, so KSE Institute could miss some of the exits but we found the new solution allowing us to get the proper access to the registers in the future.

⁷ A “Company news” section is available on the project site https://leave-russia.org/, follow daily updates directly on the website