European companies with operations in Russia are doubly challenged. They must urgently make difficult decisions about whether and how to continue operating in Russia, including measures to help employees based in Russia, but also how to defuse rising emotional tensions among employees based across Europe.

Considerations of the human cost of these decisions are paramount. As we enter the third week of war in Ukraine, Human Capital Council members of The Conference Board with operations in Russia are moving from the first phase of immediate crisis management to a second phase of business contingency planning.

In discussions over the past two weeks, it’s clear that members are acutely aware of the importance of remaining true to corporate values and purpose. For example, as a healthcare provider, do you cease operations knowing this will mean withdrawing vital medicines or treatments from patients? These HR leaders are also aware that how employees are treated by their colleagues, managers and leaders during this time of crisis and conflict will shine a spotlight on the corporate commitment to equality, equity and inclusion principles, and whether it’s a lived experience for staff as well as a compass for business decisions.

The leaders stressed the importance of “doing right vs. doing easy” and avoiding short-term popular decisions, which might have unintended consequences. Operations in Russia comprise more than a third of regional turnover for some of our members, while others have thousands of employees based in Russia. Our panel of experts and practitioners will offer insights on the possible short-, medium-, and long-term effects of the current situation on supply chains.

Insights for What's Ahead

Making the move from crisis management to contingency planning

• C-suite leaders need to continuously communicate and champion corporate values and principles (including respect for all employees, prioritizing the safety of people, ensuring equality). Some members spoke of the need for leaders to show conviction and courage in the face of high emotion, tough questions or criticisms both from employees and externally from customers or shareholders. As the public face of the business, C-suite leaders are the guardians and role models of the corporate values and principles.
• React quickly where necessary, balanced by planned interventions. As companies move from crisis planning, they are turning to scenario planning for the medium and long term. Some are using this strategic tool in a relatively simple way to create some space for leaders, some of whom have been affected personally by the invasion, to think more calmly and objectively. It is also vital for leaders to think more broadly of the social, political and economic consequences of a prolonged conflict.
• Actively address employee engagement, wellbeing and productivity across the region. Companies are already seeing a rise in employee fear, anxiety, sick leave (and as a consequence, a decrease in productivity). This is not just among employees in Eastern Europe, but enterprise wide. Companies are implementing a range of human capital strategies, some of which are covered here, to proactively manage these challenges.

HR interventions underway for employees in Russia  

As companies make decisions on whether to exit, halt or continue business operations in Russia, our European-based Human Capital members are taking the following measures to help employees in Russia. In a separate report, we detail steps that our members are taking to help employees based in Ukraine.

• Understanding how much cash local employees have due to the economic sanctions, rising inflation and loss of purchasing power. Some members are reassessing salaries and paying out bonuses ahead of time and salaries up to three months in advance. Although some employees are asking for hard currency payments, companies are legally required to make payments in local rubles to anyone employed by a Russian entity.
• Keeping the communication lines open with employees and direct reports based in Russia, and ensuring that local leaders are enabled to manage the necessary employee interventions. This includes being sensitive to and aware of the fear many Russian employees have about expressing their views about what is happening.
• Setting up or activating Employee Assistance Programs to remind employees of available support to address mental wellbeing, discuss fear of sanctions, conscription or feelings of shame, and also to address key financial and legal questions. It is important to provide clear internal communications about the resources on offer to staff and for line managers to encourage their staff to access them.
• Responding to requests from local employees to relocate. Companies are now starting to see requests from local employees in Russia and Belarus for relocations as they no longer feel safe. Some have opted to take their vacation and travel to places such as Turkey and Finland. Some companies have decided to offer these employees the option to apply for open positions in other countries, but this process can take months.
• Supporting temporary moves. Some are advising Russian employees who want to move about a limited number of countries that admit Russian workers without visas for between 30 and 60 days, such as Turkey, South Africa, Serbia and Israel. In countries with visa requirements, Russian employees will have to ask for asylum or apply for a tourist or business visa.
• Accelerating planned talent and succession moves, and thereby immediately proactively offering senior or high potential Russian employees positions elsewhere.

HR inventions beyond Russia

There are needs for Human Capital strategies involving Russian employees who are based outside of Russia as well. Companies report that emotional tensions are high. Some Russian employees and their families are experiencing discrimination, especially in Eastern European countries. Some employees have openly asked companies to change their reporting lines away from Russian managers, while others, working in regional hubs, are refusing to speak to their Russian-based line managers. There is a sense of taboo around asking Russian employees, “how are you?” and support is needed for mental health and well-being.

HR, especially DEI leaders, have a huge role to play in leading and enabling the organization to manage these challenges. Practical steps include:

• Partnering with the business, and supporting leaders to bravely navigate sensitivities which might include guidance on moderating difficult conversations among the team, or one-to-one check ins with employees who are distressed or anxious. Leaders must also be prepared to handle conflict when employees from different parts of the world have radically different interpretations for the war in Ukraine.
• Being prepared for the current crisis to reignite controversy or emotion about past crises. Leaders need to be prepared for some controversial and painful issues to resurface. Some employees are speaking up about inconsistencies in HR policies supporting Ukraine employees, and in the company’s overall public stance, compared to other conflicts or emergencies. HR leaders told us that some employees have spoken about of their disappointment that the organization did not responding in a similar fashion during the Syrian and Afghan crises (or for some, the current crisis in Ethiopia). The topic of Taiwan is also a contentious issue for companies with staff in Eastern Europe and Asia Pacific.
• Implementing formal listening sessions. Establish a clearly defined intent up front to avoid misinterpretation or alienation among employee groups. The messaging on the intent can include creating unity, championing corporate values of equality and inclusion, and drawing on learnings and approaches from Black Lives Matter, among others.
• Enabling leaders to set up calls and daily checkpoints with senior Russian leaders across the organization–both in Russia and beyond.
• Extending support, including trauma coaching for HR teams across the countries bordering Ukraine where Russian employees are based and who may have been overlooked in the first stage of crisis planning.

What’s next?

There are signs that our members are beginning to migrate to phase three: complementing current crisis/contingency plans with scenario planning to guide strategies for operations and employees in Russia and Eastern Europe in the weeks and months ahead.  We will continue to share practical strategies to help HR leaders respond to the crisis and to the inevitable ripple effects that will affect business operations and workforce wellbeing.