Nearly a year on from the supposed Russian exodus, most major companies have yet to withdraw

After Russian troops invaded Ukraine successful February 2022, companies crossed the G-7 large economies and the European Union announced plans to cease concern operations successful Russia.

Yet by the extremity of the year, precise fewer had afloat delivered connected that promise, according to caller probe from Switzerland's University of St. Gallen.

The study published earlier this period documented a full of 2,405 subsidiaries owned by 1,404 EU and G-7 companies that were progressive successful Russia astatine the clip of the archetypal subject incursion into Ukraine. 

By November 2022, less than 9% of that excavation of companies had divested astatine slightest 1 subsidiary successful Russia, and the probe squad noted that these divestment rates hardly changed implicit the 4th fourth of 2022.

"Confirmed exits by EU and G7 firms that had equity stakes successful Russia relationship for 6.5% of full nett earlier taxation of each the EU and G7 firms with progressive commercialized operations successful Russia, 8.6% of tangible fixed assets, 8.6% of full assets, 10.4% of operating revenue, and 15.3% of full employees," professors Simon Evenett and Niccolo Pisani wrote. 

"These findings mean that, connected average, exiting firms tended to person little profitability and larger workforces than the firms that stay successful Russia."

More U.S. firms were confirmed to person exited Russia than those based successful the EU and Japan, Evenett and Pisani noted, but the study inactive recovered that less than 18% of U.S. subsidiaries operating successful Russia were wholly divested by the extremity of 2022, compared to 15% of Japanese firms and conscionable 8.3% of EU firms.

Of the EU and G-7 companies remaining successful Russia, the probe recovered that 19.5% were German, 12.4% were American owned, and 7% were Japanese multinationals. 

"These findings telephone into question the willingness of Western firms to decouple from economies their governments present deem to beryllium geopolitical rivals," Evenett and Pisani wrote.

"The study's findings are a world cheque connected the communicative that nationalist information concerns and geopolitics is starring to a cardinal unwinding of globalisation."

Pressure to exit volition build

Europe's presumption arsenic a laggard successful the propulsion for Russian divestment was besides highlighted by Barclays successful a enactment connected Friday Jan. 20.

The British lender's European user staples analysts said that portion astir of the companies they screen had pledged to exit Russia, partially successful effect to ESG-related unit from stakeholders and the menace of sanctions, fewer person managed to bash truthful yet. Various companies told Barclays that determination were a big of challenges to afloat divest.

"In summation to the deficiency of clarity implicit what assets determination mightiness beryllium worth, the database of imaginable buyers is short, and the database of imaginable buyers who are authorisation exempt is adjacent shorter," Barclays analysts noted.

"There person besides been suggestions that the assets (including intelligence property) of companies that permission Russia volition beryllium nationalised."

Barclays suggested that with nary extremity to the struggle successful sight, the disconnect betwixt pledges and outcomes volition request to beryllium resolved, and volition unit companies into immoderate pugnacious decisions.

"If exiting Russia astatine thing approaching a just valuation is highly challenging (if not outright impossible), past the prime facing companies is whether to exit astatine an unfair valuation (or so for thing astatine all), oregon stay successful Russia," the analysts said. 

"Few commentators look to deliberation a adjacent word extremity to the struggle is likely, and we fishy unit to marque bully connected pledges to exit whitethorn physique arsenic clip goes on."

They added that companies that person paused advertizing and reduced merchandise assortments but inactive mean to enactment successful Russia volition beryllium progressively challenged by wider stakeholders and tightening sanctions.

In particular, Barclays named CCH, Henkel, PMI, JDE Peet's and Carlsberg arsenic having the largest income vulnerability to Russia wrong the European user staples sector.

Henkel has repeatedly stated its volition to exit Russia and been transparent with the concern assemblage connected the apt impact, since astir 5% of income and 10% of EBIT (earnings earlier involvement and tax) derived from Russia. Barclays' Henkel forecasts presume nary publication from Russia for full-year 2023 and beyond.

"While state level EBIT information is hard to travel by, we presume that fixed that astir companies person stopped advertizing successful Russia, it is presently disproportionately profitable," Barclays said. 

"Henkel has been explicit astir the apt interaction to net of a Russia exit (5% sales, 10% EPS) and this should beryllium good known to investors, but we fishy that Russia deconsolidation whitethorn beryllium a root of borderline premix headwind elsewhere successful Staples."

Of the 29 user staples firms the portion covers, 15 person committed to exiting Russia, but Barclays analysts are lone alert of six that person really done so.

Henkel, CCH, Carlsberg, JDE Peet's and PMI did not respond to CNBC's petition for comment.

'Writing disconnected isn't selling off'

A caller study from a U.K. deliberation vessel past week highlighted that immoderate of the world's biggest companies person announced their planned exists by penning disconnected assets alternatively than selling them, thereby making "announcements of accounting entries alternatively of making Russian exits."

"Many radical deliberation that erstwhile thing is written disconnected it has been lost. A write-down oregon write-off conscionable means the proprietor has enactment a little oregon zero worth connected an plus astatine that constituent successful time. It is simply a insubstantial worth that tin beryllium revised astatine immoderate infinitesimal astatine the whim of the owner," said Mark Dixon, a London-based mergers and acquisitions advisor who founded the Moral Ratings Agency deliberation vessel successful February pursuing the Russian invasion.

"If the institution drags its heels agelong capable and doesn't permission Russia, it tin constitute up the worth whenever the satellite concern changes."