Pernod Ricard, a French beverage company, received criticism for resuming some exports to Russia after the invasion of Ukraine. 

The company made the decision to safeguard its Russian operations’ economic sustainability and prevent the possibility of being accused of fraudulent bankruptcy.

This blog will explore the reasons behind Pernod Ricard’s decision to resume exports, the reactions it has received, and what it means for the company’s future.

What compelled Russia to resume limited exports?

After Russia invaded Ukraine, Pernod Ricard, along with many other Western companies, ceased exporting goods to Russia. In late 2022, due to low stock levels, the company decided to restart exports of certain brands, like Beefeater gin and Jameson whiskey, but in limited quantities.

Pernod Ricard clarified that the decision to make the move was not taken lightly, even though some campaigners found it disgusting. They also stated that it was not a typical business move. 

The company expressed that they resumed exports to prevent its local affiliate from going bankrupt and to avoid the possibility of prosecution for fraudulent bankruptcy concerning its subsidiary and employees.

The company also aimed to prevent the existence of parallel markets and the occurrence of counterfeit products. Furthermore, despite the controversy surrounding the decision, Pernod Ricard has consistently opposed the invasion of Ukraine and has shown unwavering support for the Ukrainian people.

What opposition has this decision faced?

Not everyone has reacted positively to the move, with one such company being the The Moral Ratings Agency, which urges companies to leave Russia. They have strongly criticised the decision as being disgusting and ironic, due to other companies also leaving at this time. 

Similarly, when Pernod Ricard previously resumed exporting Absolut vodka to Russia, they also received a lot of criticism and backlash from the public. As a result, they eventually changed their decision and stopped exporting the vodka to Russia.

How has the company still managed to thrive?

Although there is controversy surrounding Pernod Ricard’s decision to resume exports, they continue to be one of the top spirit manufacturers globally. The company has a vast collection of well-known, popular brands that consist of Chivas Regal, Malibu, and Perrier-Jouet, just to name a few.

They have also been working on expanding their presence in emerging markets, like India and China, where demand for premium spirits is on the rise, giving them an ideal opportunity to take full advantage of.

Conclusion

There has been controversy over Pernod Ricard’s decision to resume exports to Russia, with some campaigners deeming it disgusting. However, the company has stated that the reason behind the decision was to secure the economic sustainability of their Russian operations and prevent the possibility of being accused of committing fraudulent bankruptcy.

Pernod Ricard is still a top global spirits producer, despite facing criticism for its decision, with a portfolio that includes popular brands, which are enjoyed all over the world.

It will be interesting to observe how the company’s decision to restart limited exports into Russia will affect its business and reputation going forward in the future, as it continues to manage and navigate through criticism and a difficult global market.