Be a little skeptical of why companies are getting out of Russia

There has been an unprecedented - there's that word again! - yes, unprecedented rush to sanction Russia for its ill-advised invasion of Ukraine. Governments, financial institutions, sports leagues and governing bodies, and private companies have all been sanctioning or abandoning Russia in droves. Which is all to the good - Russia, or at least Putin and his cronies, deserves everything that is coming to them.

But I can't help but be a mite suspicious of the motives of many of the companies that are falling over themselves to divest or decamp from the teetering Russian market - what you might call voluntary sanctions. We have seen divestment by energy giants like BP and Shell, suspension of Russian operations by Ford, the closing of Apple stores in the country, ditto with Microsoft and AirBnB, VISA and Mastercard, IKEA's and H&M, an even the once-bullish Canadian auto parts manufacturer Magna International has closed up shop. As of March 10th, one estimate suggests that over 330 companies have withdrawn from Russia. The commercial response to Russia's politically incorrect moves has been, well, unprecedented.

But Russia hasn't just graduated to pariah status all of a sudden. It has been annexing parts of other countries, poisoning its political opponents, interfering in democratic elections, and waging cyber warfare for years. And all these companies were perfectly happy sharing in Russia's ill-gotten gains (and lending legitimacy to Putin and his regime) just a week ago.

Peer pressure and public relations are part of the equation, sure. But many of them are just making a strictly commercial decision to get out of a hot, risky place while the going is still relatively good, and while using the situation to put a positive spin on it. For example, reacting about a week after everyone else, McDonalds, Coca-Cola, PepsiCo and Starbucks are clearly just jumping on a bandwagon, and not making any deep ethical decisions. I'm sure that some companies are making a heartfelt ethical choice (little Newfoundland-based Icewater Seafoods comes to mind), but capitalism does not usually let morality get in the way of making a buck.

UPDATE

As a small example of this cynicism, Shell, which had been an early adopter of the Russia boycott, just bought 100,000 metric tonnes of crude from Russia, reported at a record discount. 

This does not technically break any sanctions (there are no sanctions on Russian oil and gas - YET). They did say that we they would be donating the profits to a humanitarian fund for Ukraine, but that is kind of pretzel logic, and possibly just desperate damage limitation after what is now being perceived as a bad idea.