Say what you will about the various gay bars in North America that are boycotting Stolichnaya vodka and (horror of horrors), pouring it into the gutter. But the fact is, as reported elsewhere, they haven't done their research.
These days, Stolichnaya vodka is about as Russian as Edward Snowden. It is made in Latvia, and 90 percent owned by a Luxembourg based company controlled by an exiled anti-Putin oligarch. But the simple fact that it is the most recognizable Russian brand outside Russia makes it an easy target. And by easy I mean wrong.
Seriously, if you want to get the attention of you know who in the Kremlin (whether because of anti-gay legislation or because it has decided to grant Snowdon asylum), why not try boycotting something that matters to said Kremlin? Like say the Olympics.
Oh, right, that didn't work out so well last time.
OK, then, how about Lukoil, Russia's second largest oil company? The company has over 6000 filling stations outside Russia, including those it bought from Getty Oil and others in the US, some of which include the Kwik Farms branded convenience stores (note to advertising firm: Kwik Farms is about as appealing a concept as Latvian Vodka).
While Lukoil is a privately-owned, publicly-traded company (on the London Stock Exchange: LKOD), it currently is responsible for over 16 percent of Russian oil production and refining and is a $160+ billion a year company. That represents a lot of taxes flowing into Kremlin coffers.
Alright, so your driving past a Getty station to tank up at Shell is not going to change the minds of Russian legislators or their puppetmaster. But it will certainly have more of an economic impact on Russia than dumping three-quarters of liter of Stoli in the streets.
A campaign to encourage divestment from Russian-owned companies (a la the anti-apartheid divestment movements of the 1960s-1990s) might also tighten the screws. At least four companies are listed on the NYSE: Mobile TeleSystems OJSC (NYSE: MBT); Vimpel-Communications (NYSE: VIP); UC RUSAL (Euronext: RUSAL); Mechel OAO (NYSE: MTL) including Mechel Preferred Shares (NYSE: MTLPR).
Sure, these are not state-owned firms, but they are far more Russian than Stolichnaya and their fate is of considerably more interest to the Russian state. Together, they had a market cap of around $55 billion two years ago.
Now we're getting somewhere.
Let's consider at some other easy targets:
Some not-so-easy targets are the biggest state-owned companies, like Transneft, Gazprom, Sberbank and Rosneft.
Of course, none of this is to endorse or encourage boycotting, which has economic and social costs far beyond the "message" one might want to send. For instance, there are presumably innocent Americans working at that Lukoil gas station in New Jersey, and it is the average Russian – not the private jet flying CEO or the Kremlin favored oligarch – who will be affected most by a downturn in the fate of a Russian company's stock.
No, the main point of this blog entry is simple. It is to kindly and rationally ask people to stop the madness: stop pouring vodka down the drain. That and to do a bit of research.
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