Less than Nine Percent of Western Firms Have Divested from Russia
16 Pages Posted: 13 Jan 2023 Last revised: 14 Apr 2023
Date Written: December 20, 2022
The Russian invasion of Ukraine in February 2022 and the corporate decisions that followed offer insights into the extent to which Western firms are willing and able to sever commercial ties with nations now viewed as geopolitical rivals by their governments. We gathered extensive data on equity investments made by foreign companies headquartered in the European Union (EU) and G7 nations and checked whether following the outbreak of armed conflict divestment of their Russian subsidiaries could be confirmed. At the end of November 2022, our analysis shows that 8.5% of EU and G7 companies had divested at least one of their Russian subsidiaries. We performed extensive robustness checks that confirm our overall findings while also revealing some notable variation in divestment rates.
Keywords: Geopolitics, decoupling, divestment strategy, Russia, Ukraine, Russian invasion, international business, globalization
JEL Classification: F23, F51, F52
Suggested Citation: Suggested Citation