The Ukraine Crisis: How are global Executives responding?

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March 24, 2022
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Leadership StrategiesLeadershipHuman ResourcesBoard Director and Chair Search
Executive Summary
How many companies are exiting Russia and what are business leaders’ biggest concerns about the war?
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The war in Ukraine has sent shockwaves around the business community, with a host of high-profile global corporations pledging their support to Ukraine and promising to act. But what actions are they taking? How high is the Ukraine crisis on the leadership agenda? And what proportion of companies have stopped operating in Russia so far?

We recently polled CEOs, C-suite leaders, and board directors to find out more about how global executives are responding to the Ukraine crisis—and their thoughts on how the war will impact their operations and people.

A version of this article was originally published on 24 March 2022 based on responses to our Global Leadership Monitor survey collected between 16 March 2022 and 21 March 2022.  Since the survey was still in the field when the original article was published, this article has now been updated to reflect the full set of responses collected from 16 March 2022 to 2 April 2022 with additional regional cuts. Where the analysis has changed significantly from the original article, it is noted in the text.

How high is the Ukraine crisis on the leadership agenda?

Just under two-thirds of CEOs and C-Suite Leaders say that their executive leadership team has met to discuss Russia’s invasion of Ukraine.  Given their proximity to the conflict, executive leadership teams in Europe are most likely to have met (79%). Less than half of boards have convened to discuss the issue globally, with Asia (16%), the Americas (32%), and Oceania (Australia and New Zealand) (26%), significantly lagging Europe, where over six in 10 boards convened to discuss the war in Ukraine.

Leadership Teams Convening to Discuss the War in Ukraine
(Percentage of respondents reporting team has convened at their organization)

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Review Board Leadership and Performance in a Crisis for 3 key principles boards should follow at this time.

 

What humanitarian actions are companies taking?

CEOs and Chief Human Resource Officers have so far concentrated efforts on fundraising drives. Only a minority say they’ve completed more complex activities, such as dispatching equipment and supplies or providing logistical support. European companies have been most active in offering aid, and Asian and Oceanic companies least active.

Aid Mobilized by Organizations
(Percentage of CEOs and CHROs)

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(n=261)

 

How many companies have withdrawn from Ukraine?

Organizations that have teams and businesses in Ukraine have been faced with immediate crisis decisions, especially those that have offices or facilities near the front lines.

Of the CEOs and C-Suite leaders we surveyed, 12% reported that they have offices or facilities in Ukraine.  Just under half (47%) reported that they have shut down their facilities or offices (or are in the process of doing so) while a clear majority (65%) reported that they have evacuated staff (or are in the process of doing so).

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(n=75, insufficient n to report on Asia separately; no leaders in Oceania reported having offices or facilities in Ukraine)

 

How many companies have exited Russia?

Despite the press attention on high-profile corporate exits from Russia, our data indicates that more companies are staying in the country than you might think—at least for now.

Of the CEOs and C-Suite leaders we surveyed, 18% said they had offices or facilities in Russia. Just over a third (37%) said that they shut down their facilities or offices in Russia (or are in the process of doing so) and this is an increase from the 28% originally reported on the 21st March. Additionally, 22% said they have evacuated staff (or are in the process of doing so).  Companies in Asia are notably less likely than those in Europe to have taken either of these actions (note that the n is relatively small for Asia, at only 18 executives).

Decisions on exiting Russia and the process of doing so fully is not a straightforward one. Considerations towards one’s Russian employees, the risk of seizure of assets, IP, and trademark appropriation, as well as other supply chain and operational considerations, are all real.  As the war approaches its third month however and the brutal toll on civilians mounts those considerations may become increasingly less important.

Actions on Offices or Facilities in Russia
(Percentage of CEOs and C-Suite leaders who indicated they have offices or facilities in Russia)

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(n=114; insufficient n to report on Oceania separately)

 

How concerned are leaders about business in Russia and Ukraine?

Close to 6 in 10 leaders globally are concerned about understanding and aligning with sanctions against Russia.  Concern levels are highest amongst leaders in Asia (67%), notably ahead of their peers in the Americas (52%). While upward of half of leaders globally, for whom it is applicable, are concerned about the continuity of relationships with suppliers and/or customers in Russia and Ukraine, leaders in Asia are again most likely to be concerned.

Concerns Operating in Russia and Ukraine
(Percentage of CEOs and C-Suite leaders concerned or very concerned*)

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(Respondents for whom the issue was “not applicable” were excluded from the analysis).

 

What human capital concerns do leaders have?

Employee welfare is top of mind for business leaders. This extends beyond supporting employees who have families in the region (a concern for 72%) to the broader emotional impact on all employees (a concern for 72%). Additionally, 79% are concerned about the impact of cost of living increases on employees.

While wage inflation will be one factor leaders need to consider, the more important and more immediate concern will be for the ability of their lowest-paid employees to make ends meet.

Human Capital Concerns
(Percentage of CEOs and C-Suite leaders concerned or very concerned)

rra-the-ukraine-crisis-04 (Respondents for whom the issue was “not applicable” were excluded from the analysis).

 

There is an interesting difference between responses in Asia and those in the Americas and Europe on two issues. In Asia, fewer, at just over half, of leaders are concerned about the emotional impact on employees, but notably, more leaders in Asia (43%) are concerned about tensions between employees who take a different stance on the issue, than in the Americas (29%) and Europe (22%). This is likely a factor of the different types of relationships countries have with Russia today, and have had historically.

 

What business impacts do leaders anticipate?

On the heels of a two-year global pandemic, leaders are bracing for more business volatility—from cyber security concerns to increasing prices and supply chain disruption. These concerns are consistent across regions.

For organizations with long or complex supply chains, access to supplies, redundancy, flexibility, and resilience will be key differentiators, replacing a traditional focus on speed.

Broad Business Concerns
(Percentage of CEOs and C-Suite leaders concerned or very concerned)

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(Respondents for whom the issue was “not applicable” were excluded from the analysis).