RUSSIA – Pernod Ricard has decided to stop exporting its premium vodka Absolut to Russia, with immediate effect, after criticism that it was a “crazy decision” to export the drinks to the country and “unacceptable that Absolut Vodka supports Russia’s warfare.”
Absolut Company CEO, Stephanie Durroux, said in a statement that Pernod’s primary consideration since the beginning of the conflict “has always been and remains the welfare of its teams in the region, their individual safety, and that of their families.”
The news follows recent reports around Pernod’s decision to restart shipments to the country amid the ongoing war in Ukraine. The Russian business accounted for 3% of its sales before Russia invaded Ukraine, with the percentage decreasing in 2022.
“Since March 2022, in full compliance with all applicable international sanctions and local legal constraints, the Group’s activity in Russia has been strongly reduced, and marketing investments have been stopped,” said a spokesperson for The Absolut Company.
“By ensuring the economic viability of its distribution subsidiary through limited supply, Pernod Ricard has been able to protect its local team from any local criminal liability, relating to ‘intentional bankruptcy’ in particular.”
Last week, several media outlets reported that Absolut was “supplying products in an amount that can support local employees and give local entities economic sustainability,” citing a Pernod spokesperson.
The spokesperson added that the company fears that without minimal business activity in the country, Russia could take advantage of its bankruptcy laws and go after its employees. Furthermore, the forceful nationalization of the company could be a risk.
There has been a backlash against the company from politicians, including a Swedish member of the European Parliament Karin Karslbro, who said that supplying Absolut to Russia was a “nice gift to Putin,” a “crazy decision” and added that it is “unacceptable that Absolut Vodka supports Russia’s warfare.”
“There are no excuses for a Swedish company to undermine the international pressure against Russia in this way,” she highlights.
However, Durroux noted that the decision will “not prevent Absolut from falling into the hands of the parallel market, which has strongly increased in recent months and over which we have no control.”
In India, the company has also got a hit in marketing its products after the excise department of the government of the National Capital Territory of Delhi, refused to renew the license of the French alcohol giant that warrants the company to market its products in New Delhi city.
Order from city authorities, seen by Reuters, said the decision was reached after reviewing Pernod’s license application, along with “considerable documents” received from investigating agencies in India.
For all the latest food industry news from Africa and the World, subscribe to our NEWSLETTER, follow us on Twitter and LinkedIn, like us on Facebook and subscribe to our YouTube channel.