Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Another important example is the experience of Leroy Merlin. Shortly after a Russian rocket obliterated one of the largest shopping malls in Kyiv on Monday,

image text in transcribedimage text in transcribed
image text in transcribedimage text in transcribed
Another important example is the experience of Leroy Merlin. Shortly after a Russian rocket obliterated one of the largest shopping malls in Kyiv on Monday, Ukrainian employees of Leroy Merlin, a home improvement store that was destroyed in the blast, commandeered the company's Ukraine Instagram page. "Stop Sales in Russia," they wrote, posting a picture of the shattered remains of the site, where a security guard for the company was killed, one of eight fatalities in the predawn strike. Leroy Merlin shut its six stores in Ukraine after the war started, and paid employees the equivalent of three months' salary. It has even helped workers and their families cross the border to Poland and Romania for safety. But in Russia, the company operates 112 stores, and has given no public signs that it plans to leave. Just the opposite: It is working to expand its Russian inventory to adjust to sanctions and the departure of rival Western chains, according to an internal message provided by employees. The Instagram message wasn't the first time the Ukrainian workers had spoken out against Leroy Merlin's insistence on doing business in Russia. Around 350 of them signed a petition last month asking the French parent company of Leroy Merlin, the Adeo Group, one of Europe's largest retail conglomerates, to withdraw all business operations from Russia. After employees sent executives the plea and posted messages on social media, Leroy Merlin shut down the Ukrainian unit's internal Gmail accounts - blocking the ability to communicate with the home office and one another, according to interviews with two employees and posts by other Leroy Merlin workers on social media. Managers also asked Ukraine staff to remain politically neutral about company business, they said. LEROY MERLIN "Adeo told us that their biggest quality is their humanism," said Anatoliy Zelinskyy, Leroy Merlin's brand manager in Ukraine and STOP SUPPLING an author of the message on the Instagram page. "But I never expected such a reaction from a business that claims RUSSIAN AGRESSOR humanitarian values." The list of global brands announcing their exit from Russia is growing by the day, adding pressure on the Russian economy and drawing threats from Russian President Vladimir Putin to nationalise Western businesses that pull out. But the Adeo Group is among a number of companies making a decision to stay. It also owns the Auchan chain of giant supermarkets and Decathlon, a sporting goods retailer. For Leroy Merlin and Auchan, Russia is the second-largest market behind France. Altogether, they have over 400 stores in Russia, where they employ 75,000 workers and earned combined sales of over E8 billion in 2021. The destruction of the Leroy Merlin in the Retroville mall in Kyiv opens a window onto the conflicting interests and thorny corporate and humanitarian calculations facing companies that have spent decades setting up operations and gaining market share in Russia. Adeo has not issued any statements on its activities in Russia since the conflict began. The company did not respond to email, text and telephone requests for comment for this article. Adeo's Linkedin page promotes solidarity with Ukraine, but after a barrage of online criticism over its unwillingness to leave Russia, comments were removed and disabled. The company's position remains a source of angst for a number of its Ukraine employees. They see humanitarian actions taken by Adeo since the conflict began, including providing donations and helpingUkrainian refugees flee Russian rockets, as being at odds with the decision to continue doing business in Russia. Adeo's chief executive, Philippe Zimmermann, laid out the company's thinking in a video address to employees, which was obtained by The New York Times. "The war in Ukraine is dramatic, unbearable for both Ukrainians and Leroy Merlin in Ukraine. It affects us all," Mr. Zimmermann said, acknowledging the concerns of Ukrainian employees and citing the bombing of the mall and the death of the contract security guard. "There is no reason to condemn our Russian teams for a war they did not choose. There is no reason to turn away 45,000 employees representing more than 100,000 people with their families. There is no reason to stop being useful to Russians who need to repair, insulate, insure, protect and light their homes. We sell them essentials. It is our responsibility as employers and companies." Leaving Russia would risk having the company's assets taken by the Russian government, to the detriment of Adeo's Russian employees. Workers in Ukraine say the two situations can't be compared. "They are talking about the well-being of Russian employees," said Yevgeniy Kuzmin, digital director for Leroy Merlin in Ukraine. "But we are facing life and death in Ukraine - this is war," he said by telephone from Lviv, an air raid siren blaring in the background. Hundreds of the Ukraine employees signed the internal petition calling MERLIN for Leroy Merlin to exit Russia and posted similar messages on the LEROY retailer's Ukraine Facebook and Instagram pages. Managers pressured them to remove the messages, Mr. Zelinskyy and Mr. Kuzmin said. Soon after, Leroy Merlin's corporate communications channels in Ukraine were taken offline. "Adeo explained that they were doing this due to the high risk of hacker attacks on our system and that it would be blocked temporarily," said Mr. Zelinskyy, the communications manager. "But one month later, these still have not been put back online." Some employees were also angered by a leaked internal message, dated March 11, that showed that managers in Russia were trying to expand their selection of items as major competitors pulled out of the country and Western sanctions disrupted imports. "After the departure of some companies, we are open to your suggestions to increase supplies and expand the product range," said the message, which was sent to Russian suppliers and seen by reporters. "In the next three to four months, we plan to completely replace the imported products with goods produced in Russia." In interviews, Ukraine employees acknowledged that Leroy Merlin had taken numerous steps to help deal with an unfolding humanitarian disaster when the Russian military invaded on Feb. 24. It authorized donations from its stores, including sand, wood and insulation, enabling Ukrainian soldiers to build bomb shelters and use sandbags to block Russian military vehicles. Some Leroy Merlin workers took up arms or joined Ukraine's cyber army to combat the invasion. Meanwhile, Mr. Kuzmin said, opposition to Leroy Merlin and Adeo's decision to stay in Russia was growing online. "We started to receive a lot of hate messages from our customers on social media, saying, guys you are an international company and you are also present in Russia. This means a great deal of finance goes to the Russian state budget, which helps to support war," Mr. Kuzmin said. When the Russian rocket obliterated Leroy Merlin's Kyiv store and killed the security guard - who had a wife and a child and had worked at the store as a sales associate for several years before switching jobs - Ukraine employees ramped up the visibility of their plea. They logged into Leroy Merlin's Ukraine Instagram page and posted a link to an online public petition for the company to stop sales in Russia, which had gathered over 15,000 signatures by Wednesday evening. On Thursday, the page had been taken down. "Every day, our directors would tell us that Adeo is human-centric, that humanity is at the heart of the company," Mr. Kuzmin said. "But when it comes to war, where is the humanity? Only money matters."

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Labor and Employment Law Text and Cases

Authors: David Twomey

15th edition

1133188281, 978-1133711841, 1133711847, 978-1285247632, 978-1133188285

Students also viewed these General Management questions