The ex-PepsiCo CEO privately called Vladimir Putin a “great leader” at a high-level meeting in Switzerland shortly after Russia’s 2014 annexation of Crimea – and angered other business leaders, despite enjoying unusually comfortable relations with the Russian president, eh The Post has learned.
Indra Nooyi — who ran the Purchase, New York-based soda and snacks giant from 2006 to 2018 — raised eyebrows more than once as she aggressively attempted to forge ties with Putin’s Russia. Their bold investments began to unravel Tuesday when the company, along with arch-rival Coca-Cola, announced it would stop selling and advertising soda in Russia. Pepsi shares fell 2.7%.
In October 2011, shortly after PepsiCo paid $5.4 billion for Russian dairy and juice conglomerate OAO Wimm-Bill-Dann, Nooyi gave a gushing review of Putin’s leadership.
“I’ve met with many, many world leaders,” Nooyi told the Moscow Times. “But when it came to the participants of the Foreign Investment Advisory Council, the issues and the comments they made, Prime Minister Putin was at the forefront on every issue.”
In May 2014, just weeks after Russia seized Crimea from Ukraine in a military invasion, Nooyi told analysts at PepsiCo the company had “great relationships” with Russian officials, according to The Wall Street Journal.
But a few months later, on September 14 of that year, sources said Nooyi went a step further when she praised Putin at a gathering of 16 top business leaders from the US, Western Europe, Russia and Ukraine held in Geneva, Switzerland, had been convened by Klaus Schwab, the founder and chairman of the World Economic Forum, to deal with the crisis in Crimea.
“She told me and a colleague from Ukraine that Putin was a ‘great leader,'” a source told The Post, noting that Nooyi had openly praised the former KGB agent over a coffee break.
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“She said she was very sorry about the war,” the source said, but “she was very clear that she thought he was an exceptional leader.”
“I was shocked, disgusted and surprised,” the source added, noting that Nooyi had praised Putin in front of Ukrainians whose compatriots had just been killed and tortured by Russian forces.
In the end, the Geneva group settled on 10 weak, watered-down proposals to deal with the crisis – partly due to urging from Nooyi, the source added.
“We were all sent home with a version where we would have to take out every critical word about Russia,” the source bleated.
PepsiCo declined to comment. Nooyi, who no longer has a position at Pepsi, did not respond to requests for comment.
Nooyi rocked Pepsi’s Russian expansion in 2008 when PepsiCo and The Pepsi Bottling Group paid $1.4 billion for Russia’s leading branded juice company, JSC Lebedyansky. A year earlier, PepsiCo and PepsiAmericas paid $542 million for Ukrainian juice company Sandora, beating a competing bid from competitor Coca-Cola. (Coke tried to catch up in 2010, paying $1.4 billion for Russian juice maker Nidan Soki.)
But Pepsi’s Russian roots stretch well before Nooyi to the height of the Cold War. Former Prime Minister Nikita Khrushchev drank a Pepsi with American products at a Moscow convention in 1959. In 1974, the soda became the first US consumer product to be sold on a large scale in the USSR.
When former PepsiCo CEO Don Kendall, who gifted the Pepsi to Khrushchev, celebrated his 90th birthday in 2012, the party was held at the Russian Embassy in Washington, DC, according to a source who attended the event. In 2011, Kendall became the first foreigner to receive the Russian Order of Honor.
“So far, tolerance for reputational risk in Russia has been surprisingly high,” Ed Verona, president of the US-Russia Business Council from 2008 to 2013, told The Post, referring to PepsiCo and other Western companies.
“Profits in Russia have been so good, and public awareness or sensitivity to the atrocities of Putin’s regime so low, that the threshold of corporate moral outrage has never been crossed.”
In 2021, Russia was still PepsiCo’s third-largest market (behind the United States and Mexico) and generated $3.4 billion in revenue — more than Canada, China, or the United Kingdom, according to public records.
PepsiCo, a maker of soda pop and Frito-Lay snacks, said Tuesday the Ukraine conflict is a “tragic war.” The Russian military, PepsiCo said privately, has taken over its Ukrainian facilities while it is still operating in Russia, producing milk and other dairy products, infant formula and infant formula.
Some investors see the risk that Russia will retaliate from the US boycott of its goods by seizing assets from US companies, including PepsiCo, which owns a dairy in Moscow and a food factory in Kashira, Russia.
PepsiCo privately told investors last week that it will soon be charging a restructuring fee as its Russian business accounts for 4.5 percent of its total sales, and that shouldn’t affect its guidance, a hedge fund manager told The Post.
“They said they make milk, water, food and things that are needed. For these reasons, they keep working,” the hedge fund manager said of the Russian companies. Pepsi confirmed Tuesday it would continue to offer staples in the country, like milk and other dairy products, infant formula and baby food, even as it halts soda sales and ends all capital investments.
Last week, the head of New York’s state pension scheme said PepsiCo needed to assess whether doing business in Russia during this extraordinarily volatile time was worth the risk.
In November, Nooyi, who handed over the helm to current Pepsi chairman and CEO Ramon Laguarta in October 2018, told Harvard Business Review that CEOs should consider their influence in the countries where they operate.
“We cannot make money at the expense of others [person] being exploited,” Nooyi said. “So the environment, social issues and governance have to be taken personally.”
https://nypost.com/2022/03/08/ex-pepsi-ceo-indra-nooyi-once-called-vladimir-putin-a-great-leader/ Ex-Pepsi CEO Indra Nooyi once called Vladimir Putin a ‘great leader’