McDonald’s Exits Russia. Russia Shrugs.
Just weeks after shuttering operations across Russia, McDonald’s has announced they are pulling up stakes and shipping out, and that they plan to sell all ~850 locations, and strip them of all branding, a process known as “de-Arching" (yes, with a capital "A").
“The humanitarian crisis caused by the war in Ukraine, and the precipitating unpredictable operating environment, have led McDonald’s to conclude that continued ownership of the business in Russia is no longer tenable, nor is it consistent with McDonald’s values,” read the official press release. The company also said it hoped to sell its entire Russian operations to a single buyer and noted their commitment to continue paying all 62,000 employees, of whom they are "exceptionally proud," until such a sale is complete.
On the one hand, hooray for freedom of association and the exertion of soft power; on the other hand, this move may in fact be a net positive for the Russian people. It’s almost like a trolley problem in reverse: a Big Mac is heading toward a Russian artery, but if you pull the switch to divert the Big Mac, the Russians might go murder Ukrainians and try to steal their land.
In his 1999 book The Lexus and the Olive Tree, professional thumbsucker Thomas Friedman put forth the Golden Arches Theory of Conflict Prevention, which states simply that “No two countries that both have a McDonald's have ever fought a war against each other.” The thrust of the idea was that any two countries with a middle-class sufficiently stable to support McDonald’s had no need of anything so ugly as war. Forget for a moment that McDonald’s’ international operations only started in 1967 with the opening of a restaurant in Richmond, British Columbia, and thus this theory covered, at the time of it was published, just 32 years of human history. The theory managed to hold up until February, when Russia invaded Ukraine, home to about 100 McDonald’s.
Russians seemed to take the news in stride.
“I think it’s completely normal given that McDonald’s didn’t bring any health benefits to our people, our population. It’s all for the best. I think they’ll be replaced by some new interesting café, new place, new restaurant,” one man on the street told the BBC. Another was confident that the Russian economy would not falter.
Which is all true enough, though the departure of McDonald’s is symptom of a larger problem than where to get 1,500 empty calories for just a few rubles. McDonald’s is a moneymaking machine that tolerates in the name of profits some rather unseemly regimes, with 3,500 Mickey D’s in China, another 300 or so in Saudi Arabia. The real problem is that if McDonald’s—which said the divestment will result in a write-off of $1.2 billion -- has decided that the Russian juice just ain’t worth the squeeze, what outside company or investor is gonna look at the Russian market and see opportunity?