Business
Column: Here’s the ‘hall of shame’ of companies that haven’t left Russia
Tons of of Western companies and firms have garnered reward for withdrawing from Russia, even when that entails successful to their gross sales and income.
Now let’s take a look at the opposite aspect of the coin. We’re speaking about corporations which have resolved to maintain working in Russia.
The “corridor of disgrace,” as Yale enterprise professor Jeffrey Sonnenfeld and his colleague Steven Tian have labeled the roster of company responses to Russia’s invasion of Ukraine they’re sustaining, consists of 34 corporations which might be “digging in, defying calls for for exit or discount of actions.”
These manufacturers … thought they have been representing Western values and a spirit of freedom and international concord. They have been blind to the indicators due to perestroika ideology and the faith of the free market.
Jeffrey Sonnenfeld, Yale College of Administration
The checklist additionally consists of 74 corporations which might be scaling again some however not all actions or deferring new investments.
Among the many client corporations recognized as “digging in” are the quick meals chain Subway; Reebok; Bacardi (makers of its eponymous rum, Dewar’s scotch and Gray Goose vodka, amongst different manufacturers); the electronics corporations LG and Asus; and Natura, proprietor of Avon cosmetics.
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A few of these corporations and others which have scaled again operations have asserted that they’re remaining in place to keep away from harming their harmless Russian workers.
That’s the argument made by Dave Robertson, president and chief working officer of Koch Industries, which is understood for its assist of far-right politicians within the U.S.
Robertson stated that the Koch subsidiary Guardian Industries employs 600 staff at two glass factories in Russia, which can proceed to function.
“We won’t stroll away from our workers there or hand over these manufacturing amenities to the Russian authorities so it could function and profit from them,” he stated Wednesday in a assertion. “Doing so would solely put our workers there at higher threat and do extra hurt than good.”
Others say enterprise fashions that contain licensing or franchise agreements preclude them from promptly or absolutely shutting down.
That’s the story instructed by Subway, which says it has about 450 eating places in Russia, “all independently owned and operated by native franchisees.” Subway says. “We don’t instantly management these impartial franchisees and their eating places, and have restricted perception into their day-to-day operations.”
Sonnenfeld doesn’t purchase these excuses. Allusions to the well-being of their workers are “a canopy for cowardice,” he instructed me. “It’s not a real humanitarian impulse, it’s simply recast that approach. These are empty, cynical messages about giving a few pennies to refugees from Ukraine and saying their hearts and minds are with them.”
As for franchise corporations, Sonnenfeld argues they may purchase out their franchisees or licensees and exit Russia that approach.
The change within the political ambiance in Russia underneath Putin appears to have caught Western company managements without warning. That shouldn’t have occurred. It was at all times clear that Russia’s post-Soviet financial and political panorama was unstable at greatest. Mikhail Gorbachev’s perestroika, or restructuring, yielded to monetary lawlessness and the rise of a privileged class of oligarchs resembling organized crime capos.
Company managements didn’t know methods to react when Putin’s conduct started to inject even worse instability into the Russian surroundings. “Putin had his pouts and tantrums, however they thought they may simply glide by them, that they wouldn’t be a severe risk,” Sonnenfeld says.
“The spirit of perestroika was wildly optimistic,” he says. “These manufacturers — Levi Strauss and Pepsi and McDonald’s — thought they have been representing Western values and a spirit of freedom and international concord. They have been blind to the indicators due to perestroika ideology and the faith of the free market.”
The harvest has been a sudden rush to the exits that would imply the lack of billions of {dollars} in long-term investments.
How the sanctions will have an effect on Putin’s insurance policies is unclear. In a video speech Wednesday, Putin acknowledged that the sanctions have brought on hardship for Russians.
He depicted them as a international effort to weaken Russia: “The collective West is making an attempt to fracture our society, speculating on the socioeconomic penalties of sanctions, frightening a civil confrontation with the purpose of the annihilation of Russia.” The expertise, he stated, “will solely strengthen our nation.”
Some Western corporations haven’t been very particular about the way forward for their Russian operations. The enormous meals firm Mondelez, which produces Oreo cookies and owns Cadbury chocolate, has stated that it’s “scaling again all non-essential actions in Russia whereas serving to keep continuity of the meals provide throughout the difficult occasions forward.”
Mondelez landed on Sonnenfeld’s “scaling again” class, however he doesn’t solely settle for their phrases. “Oreo cookies and Cadbury candies are vital staples in my family, however they aren’t required for sustaining life in Russia,” he says. “Even when they have been, they need to be curtailed — none of that is a few mushy touchdown for the Russians.”
Additionally unclear is the standing of some Western firm operations in Russia. Reebok’s Russian-language net web page stopped taking orders as of March 9, although clients can nonetheless view its product choices. Particular person retail shops, nonetheless, will stay open till additional discover, the positioning says.
Essentially the most notable corporations recognized by Sonnenfeld as “digging in” are three main oilfield companies corporations, all primarily based in Houston: Halliburton, Baker Hughes and Schlumberger.
Russia’s oil and gasoline business isn’t presently topic to the total panoply of worldwide sanctions, nevertheless it’s depending on these corporations for drilling and manufacturing. The U.S. has banned imports of Russian petroleum merchandise and forbidden U.S. corporations to make new investments within the Russian business; the European Union has additionally banned new capital investments.
Neither the U.S. nor the EU has ordered the oilfield corporations to withdraw, however little would maintain them from halting their operations in Russia or suspending their partnerships with Russian petroleum corporations.
Of the three, solely Halliburton has commented publicly in regards to the sanctions. The feedback got here throughout a gathering with securities analysts on Jan. 20, when Chief Govt Jeffrey Allen Miller was requested whether or not the prospect of sanctions would have an effect on “the trajectory of the enterprise in Russia.”
Miller replied, “These are issues we’ve seen and achieved earlier than. All the time unlucky in so some ways for therefore many individuals. However from a enterprise perspective, we’ve managed these types of issues up and down for, I hate to say, almost 100 years. So these are the sorts of issues that we might handle by.”
Greater than 400 corporations have taken agency steps to withdraw from the Russian market.
Amongst them are 150 which have made clear breaks, suggesting that they could not return. These embody legislation, consulting and accounting corporations that haven’t typically stored capital property in Russia and due to this fact might depart simply. However in addition they embody BP and Exxon Mobil, which reduce ties with Russian petroleum companions and will discover it troublesome to revive the severed relationships.
One other 178 corporations have suspended operations. They embody the European plane maker Airbus; monetary corporations akin to American Categorical, MasterCard, Visa and DeutscheBank; automakers Ford, GM, Nissan, Mazda, Toyota and Hyundai; and leisure corporations Walt Disney, WarnerMedia and YouTube.
Implicitly or explicitly, they’ve left open the opportunity of return, however a reentry level will likely be elusive so long as the Russian assault on Ukraine continues and presumably so long as Putin stays the Russian chief.
Amongst corporations which might be departing or suspending Russian actions are some that have been intently recognized with the Nineties-era opening of the Russian client market to the West — McDonald’s, which began the gold rush with the opening of its first Moscow restaurant in 1990, is closing its greater than 840 shops for now.
Pizza Hut, which quickly adopted, and even aired a business that includes Gorbachev, the previous Soviet chief, in 1998 (filmed in Moscow however not proven in Russia), can also be suspending service at 50 shops. Pizza Hut is owned by Yum! Manufacturers.
As Sonnenfeld and Tian noticed in Fortune, persevering with to function in Russia is wanting ever extra indefensible.
“The management and constituencies of at the least 400 international corporations ought to really feel nice delight of their Russian exits,” they wrote. “Then there are these different 34.”
Business
How the Jeju Air Plane Crashed in South Korea: Timeline, Maps and Photos
All but two of the 181 people aboard a passenger plane in South Korea were killed on Sunday morning, in the deadliest global aviation disaster in years.
Days after the Jeju Air crash, there is little explanation about why the plane went down. As investigators try to piece together what happened, video from the scene and early official reports offer clues.
The pilot reported a bird strike at 8:59 a.m. and told air traffic controllers at Muan International Airport that he would abort his landing attempt and circle in the air to prepare for another one. Instead of going all the way around, he approached the runway facing south at high speed.
The plane missed the usual touchdown zone and landed much farther along the runway than normal. It then hurtled down the landing strip on its belly, leaving a trail of smoke.
The pilot appeared unable to control the engines and no landing gear was visible as the plane made contact with the runway — two critical elements in slowing a plane down during landing. The plane also did not appear to have activated its wing flaps, another means of controlling speed.
The plane eventually overshot the runway and crashed into a concrete structure.
At the end of the video, the plane had burst into flames.
The aircraft was a Boeing 737-800 jet, one of the most common passenger planes in the world. It had taken off from Bangkok with six crew members and 175 passengers, most of whom were South Koreans returning home after a Christmas vacation in Thailand.
Officials recovered the plane’s “black box,” an electronic flight recorder that contains cockpit voice and other flight data that help investigations of aviation crashes.
The device was partly damaged, so it could take time to recover the data, according to experts, but it could prove crucial in determining what happened in the four fateful minutes between when the pilot reported a bird strike and when the plane crashed.
Aviation analysts are considering several factors that might have contributed to the crash, including the concrete structure near the runway that the airline slammed into before exploding into a fireball.
Similar concrete structures exist in other airports in South Korea and abroad, said Ju Jong-wan, a director of aviation policy at the Ministry of Land, Infrastructure and Transport. It was built according to regulations but the government planned to investigate whether the rules should be revised in the wake of the Jeju Air crash, he said.
A satellite image captured on Monday showed dozens of vehicles at the site of the wreckage. The work of piecing together hundreds of body parts has been painstaking, but the authorities said that by Tuesday morning, 170 bodies had been identified and four were turned over to their families.
The crash was the deadliest worldwide since 2018, according to the United Nations, when Lion Air Flight 610 crashed off the coast of Indonesia, killing all 189 people on board.
Business
California's tech titans say H-1B visas are vital. Will Trump defy MAGA and support them?
WASHINGTON — Of all the rich and powerful people cozying up to President-elect Donald Trump, few have rushed to Mar-a-Lago faster than the crowned heads of big tech, including California’s own chiefs of Google and Meta.
And few have a stronger motive to curry Trump’s favor than Silicon Valley: The fate of the H-1B visa program that permits foreign-born computer scientists, engineers and other highly skilled workers to migrate to the United States hangs in the balance.
Support for retaining H-1B from Elon Musk, the incoming president’s new closest associate, has stirred rage through much of Trump’s MAGA base, which is against immigration in almost any form. But keeping the pipeline open for tech and other skilled workers is seen by many business leaders as critical for the American economy, especially in California.
The state is by far the biggest user of the H-1B. More than 9,600 employers in California sought clearance for at least one H-1B worker in fiscal 2024, with 78,860 visa applications for new and continuing employment being approved, according to data from U.S. Citizenship and Immigration Services (USCIS).
They include all kinds of skilled work in various industries, including nurses and science teachers. But the top 10 beneficiaries of H-1B visas in California — accounting for almost one-third of all the approvals — were dominated by tech giants, most of them in the Bay Area.
“Those companies are the ones that can afford to hire outside firms that navigate the paperwork, the bureaucracy, and can jump through the hoops,” said Todd O’Boyle, who leads technology policy at the Chamber of Progress, a group backed by big tech firms.
The number of H-1B visas for new employment is capped at 65,000 a year nationally. An additional 20,000 are set aside for foreign nationals who have earned a master’s degree or higher in the U.S. H-1B visas are good for three years but can be extended for up to another three years.
Tech companies in California and elsewhere have relied on the program even as they made massive job cuts following the pandemic, during which many went overboard on hiring and other spending.
The fact that tech companies have fired thousands of American workers while hiring large numbers of foreign workers has added to the fury of anti-immigration Trump supporters, who have long argued immigrants take jobs away from Americans by working for less pay.
The question of whether that claim is valid does not have an easy or simple answer.
U.S. graduate school students in engineering and the sciences are disproportionately foreign-born, and even with that there are shortages of some highly skilled workers, particularly in high-tech engineering and emerging areas such as artificial intelligence.
Nvidia, the major Santa Clara supplier of AI hardware and software, got H-1B visa approvals for more than 1,500 workers last year in California, according to USCIS data. The company declined to comment, and other top tech users of the H-1B, including Google, Meta and Apple, didn’t immediately respond to requests for comment.
“If you lay off a programmer, it’s not the same skill set as somebody who has a post-doctorate in AI, so you have to look at the skills that are sought and why,” said Rep. Zoe Lofgren (D-San José), who sits on the House Subcommittee on Immigration and Citizenship.
But she said the H-1B isn’t without its challenges, pointing to cases in the past at UC San Francisco and Southern California Edison in which U.S. workers were reported displaced by lower-paid H-1B visa holders.
Employers who hire H-1B workers are required to pay wages at least as much as for similar U.S. professionals, but there are abuses. Lofgren said systemic improvements are needed, including stronger analysis on skill sets for the jobs available and more robust advertising on openings.
What’s more, workers from India dominate H-1B visas, in part because there are country quotas for permanent immigration, and temporary work visas are seen as a bridge to that, although the wait is often many years.
“People say the immigration system is broken, and this is part of the brokenness,” Lofgren said, adding that especially for California, “our economy is dependent on, and our prosperity is tied to, immigrants.”
The acrimony over the H-1B in recent days spiraled after far-right activist Laura Loomer attacked H-1B as a threat to American workers and national security.
She and other critics of worker visas say they lead to fewer jobs for U.S. workers, but academic research over the years has found little evidence to support that claim overall. And although some laid-off workers have been forced to retire or switch careers, studies have found many also have been re-employed relatively quickly.
For computer and mathematical occupations, the November unemployment rate was just 2.5%, up from 1.7% a year ago; and it was unchanged at 2% for architectural and engineering occupations, according to the U.S. Bureau of Labor Statistics.
Loomer suggested a major clash ahead between immigration hardliners like Stephen Miller, named as Trump’s deputy chief of staff for policy, and those including Vivek Ramaswamy, the former Republican presidential candidate who with Musk has been charged by Trump to cut government spending and regulation.
Musk, the world’s richest person who runs Tesla and SpaceX and is himself an immigrant and onetime H-1B visa holder, has come out championing the hiring of skilled foreign workers.
The visa program has certainly helped Tesla, which this fiscal year received H-1B approvals for 1,765 new and continuing workers, although SpaceX has grown with little benefit of H-1B workers. (Musk moved Tesla’s headquarters to Austin from Palo Alto at the end of 2021, and said this year that he was relocating SpaceX to Texas as well.)
“OF COURSE my companies and I would prefer to hire Americans and we DO, as that is MUCH easier than going through the incredibly painful and slow work visa process,” Musk wrote on Christmas Day on his social media platform, X. “However, there is dire shortage of extremely talented and motivated engineers in America.” He added: “It comes down to this: do you want America to WIN or do you want America to LOSE. If you force the world’s best talent to play for the other side, America will LOSE.”
Trump on Saturday seemed to side with Musk.
“I’ve been a believer in H-1B. I have used it many times,” he told the New York Post. “It’s a great program.”
(Trump’s businesses have used predominantly the H-2B program, which are for temporary seasonal workers that hotels and tourist businesses, for example, make heavy use of during summer. H-2A is for temporary farm workers.)
Despite his record and promises to seal the borders and deport millions of undocumented immigrants, Trump’s remarks raised hopes among some immigration advocates that the incoming president could take a softer tack on H-1B visas.
In his first term, Trump’s team made it a lot tougher for employers to get H-1B approvals, and denial rates jumped above 20% in fiscal years 2018 and 2019, triple the average of the prior administration, according to the National Foundation for American Policy, a Washington think tank that favors higher levels of immigration.
“At minimum it muddies the waters,” said Stuart Anderson, the group’s executive director. “It could signal a neutral policy rather than a hostile one.”
Stephen Yale-Loehr, an immigration expert at Cornell Law School, said that despite the deficiencies in H-1B, he believes that “most employers try to follow the rules. At the macro-level H-1B workers are helping our economy and creating more jobs for U.S. workers.”
Entrepreneurs, in particular, have talked about skilled worker visas as being critical for their growth.
Yale-Loehr also noted that recent changes have given U.S. immigration officials greater authority to tighten up the H-1B program, including imposing penalties and inspections.
That could strengthen enforcement and cut down on abuses, if Trump actually follows through on his supportive remarks.
“It’s too early to see. You’ve got some people in the administration like Elon Musk who want to preserve the H-1B category and other people like Stephen Miller who want to restrict all immigration, including H-1B,” Yale-Loehr said. “We’ll see which side wins over the four years of the Trump administration.”
Business
Trader Joe's to open three new L.A. stores in 2025
Trader Joe’s, the popular grocery chain known for its unique original products and affordable prices, will open three new stores in Los Angeles next year.
According to the company’s website, the new locations will be in Northridge, Sherman Oaks and Tarzana in the San Fernando Valley.
The website lists the planned addresses for each storefront but does not specify when they will open. A Trader Joe’s spokesperson confirmed to Nexstar Media Group that the new locations are expected to open next year.
The chain intends to open at least nine other stores in 2025, including in Seattle and New York, as part of a nationwide expansion.
Earlier this year, the company confirmed it would open eight new store locations in Southern California, including in South Pasadena, Northridge, Sherman Oaks, Santa Clarita, Ladera Ranch, Murrieta, Poway and Santee.
The rate of openings “is faster than it’s been in the last few years,” a Trader Joe’s spokesperson told The Times in May.
Trader Joe’s opened its first location in Pasadena in 1967 and remains headquartered in Monrovia.
The chain has gained a cult-like following for its branded merchandise, wide array of frozen options and well-priced produce.
The privately held company operates more than 540 locations in 42 states and Washington, D.C.
A spokesperson for Trader Joe’s could not be immediately reached for comment.
Here are the new locations coming to SoCal:
- 9224 Reseda Blvd., Northridge
- 14140 Riverside Dr., Sherman Oaks
- 18700 Ventura Blvd., Tarzana
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