It’s been a week since Russian troops launched an attack on Ukraine. As Western countries continue to disrupt Russia’s economy with increased sanctions, the business community is now weighing in.
Visa CFO Vasant Prabhu filed a Form 8-K with The U.S. Securities and Exchange Commission (SEC) on Wednesday. The company emailed me a copy of the document. It states: “Regarding the invasion of Ukraine, our number one priority is ensuring the safety and security of our colleagues and their families who are directly impacted. Visa is in the process of complying with all applicable global sanctions. As part of that compliance, we have suspended access to Visa for certain clients. It is difficult to reasonably estimate the full potential financial impact of this situation on Visa at this time.”
“In fiscal full-year 2021, total net revenues from Russia, including revenues driven by domestic as well as cross-border activities, were approximately 4% of Visa Inc. net revenues and total net revenues from Ukraine were approximately 1% of Visa Inc. net revenues,” according to the document.
Visa is among the large U.S. companies that are pausing business with Russia. Other companies include Apple, Google, Meta, Ford, and Mastercard.
Cornell Law School Professor Charles K. Whitehead believes that all public companies should be required to disclose their ties with Russia. In a new Fortune opinion piece, Whitehead writes, “Sanctions on Russia and Russian businesses will affect those who associate with them, including companies outside of Russia.”
He continues, “Regulators and shareholders alike must require companies to disclose these associations. The SEC should propose a new rule that requires public companies to disclose that risk—on each reporting company’s website and in public reports to the SEC—as well as the extent to which a company has minimized that risk following Russia’s aggression.”
Whitehead also thinks investment managers, “whose funds invest in businesses that are tied to Russia or Russian companies,” should be subjected to a similar rule. “Wholly apart from a moral interest in knowing whether a company is tied to Mr. Putin’s Russia, investors should be made aware of the risks of investing in a business whose financial well-being will be affected by sanctions,” he writes.
Whitehead points out the potential backlash that may result from companies doing business with Russia.
“The global outcry against Mr. Putin’s war also makes the reputational impact of associating with Russia and Russian business particularly material,” he writes. You can read more of Whitehead’s assessment here.
What are your thoughts on the topic? Let me know.
See you tomorrow.
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"Bringing people together like this, and leading from the front, has inspired not only his country but also people from all over the world to join in the fight."
—David Rock, founder and CEO of the workplace consultancy NeuroLeadership Institute, on Ukrainian President Volodymyr Zelenskyy's leadership during the crisis, as told to Fortune.
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