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UKRAINIAN COMPANIES: EXTREME RESILIENCE, VALUES, AND BELIEF IN VICTORY

By Maryna Saprykina, Head of the Board for CSR Ukraine.


The war against Ukraine has been going on for over a year now, but Ukraine remains unconquered. Businesses continue to operate, Ukrainians pay taxes and donate towards drones, weapons, and pickups for the army and victory.


 



There is much to rebuild. The total amount of direct documented losses as of January 2023 amounts to $137.8 billion (according to the KSE’s Russia will pay project). 3,151 schools have been significantly damaged, with 440 entirely destroyed. Residential buildings, hospitals and social infrastructure similarly have been damaged. But the reconstruction cannot be postponed until after victory. It needs to happen every day.


Businesses in Ukraine and abroad can help with this. Of course, it is important for Ukrainian businesses to fully recover, as 15% of Ukraine's territory is still occupied by the aggressor country, and one third of the territory is mined. The fall in the national economy stands at 30%.


Despite the war, the decline turned out to be less than expected, and over the past year Ukrainian businesses have demonstrated extreme resilience. The CSR Ukraine reflected this experience in its positional document "War-time Sustainability", which can be useful for many national and international companies in developing their sustainability strategies during wartime.


Extreme resilience – this is the level to which companies in Ukraine have raised the bar, so their activity conditions could not be equated to financial crises or COVID-19. Most of the companies showing extreme resilience are in IT. But some logistics, retail, and aviation companies have even risen from the brink of bankruptcy. Among such companies are Nova Poshta, the largest delivery company, whose delivery volume in the first days decreased to 2% of the pre-war volume; Rozetka, a retail company, whose stores were looted and destroyed; and Metinvest, a company from the same heroic Mariupol city. These companies have recovered, are developing, and have even opened in other countries. Ukrainian extreme resilience consists of five ingredients:

  1. Flexibility of decision-making: Decisions are made here and now, and business processes are built around the needs of the time.

  2. (De)centralisation: Many owners have been involved in the operational management of companies and have eliminated unnecessary links in decision-making.

  3. Diversification of income generation: Companies have developed several directions and products.

  4. Expansion into other markets: The world and the market have become global, so it's worth trying.

  5. Startup thinking: There is demand, so business needs to change instantly.


These five ingredients allowed Ukrainian companies to withstand. But at the core of them are the values of the owners and management of the companies, which influenced the behaviour of the companies during the first days of the war and beyond. Overall, Ukrainians believe that the companies conducted themselves honourably and demonstrated the following five values-based approaches:

  1. Preparation for various scenarios. Many companies in Ukraine have already developed Business Continuity Plans (BCPs) since 2014, the beginning of the Russian annexation of Crimea and the occupation of Donbas. In 2022, and even towards the end of 2021, even more such companies did so, with representation from the IT sector being largest. This helped them to achieve pre-war efficiency within 2-3 months. The BCPs included issues such as: safety and support of employees; responsible exit from occupied territories or the aggressor country's territory; review and update of supply chains; preparation for blackouts; provision of essential products and services to consumers along with additional free services.

  2. Place employees above all. Safety of employees and their families have been the main focus since the beginning of the full-scale invasion. Companies helped to evacuate, paid for evacuations, and undertook rescues from the occupation. For instance, Coca-Cola HBC employees created 11 Coca-Cola Care Centres mostly in central and western regions of Ukraine to help colleagues and their families during evacuations.

  3. Mental health is crucial. It is now the number one topic for companies, after safety. According to the Ministry of Health, over 15 million Ukrainians will need psychological support. While there will be a national program in Ukraine, companies can decide to act faster and more efficiently, without waiting for the government's decisions. For example, the IT company ELEKS has promptly created a centre for psychological and medical support. If employees or their close ones need help, they fill out a form, and the relevant specialists provide assistance. The company's Psychological Centre employs 15 specialists and 10 external psychologists, psychiatrists, psychotherapists, and crisis specialists.

  4. Companies have felt like part of civil society and part of communities. They are working together with international foundations and non-governmental organisations to provide assistance and achieve victory. Employees of companies are volunteering. For instance, the company EPAM, with its community of one thousand volunteers, implemented 16 IT projects in 2022, such as Agrostatus for the Ministry of Agricultural Policy and Farmers, which allowed two-and-a-half thousand Ukrainian farmers to tell what help they need, helped speed up the customs clearance of humanitarian goods from 30 to 2 minutes thanks to a new feature on the website, helped universities move their servers to AWS cloud storage, and developed a website for the Coordination Centre for internally displaced people in the city of Ivano-Frankivsk and IDPs.

  5. Openness and communication are key. According to Edelman's Trust Barometer, employees trust companies more than they trust the government. This means that even when defending their rights, employees are more likely to turn to their company for help rather than the government. Therefore, the majority of companies have established two-way communication between employees and management to support, assist, and sometimes give hope to people who have been under attack. FUIB Bank noted: "It is necessary to constantly and timely communicate with the team, clients, and community to explain in an accessible way what is happening and why. We must talk about our decisions and actions, causes and consequences. The Ukrainian banking system survived the war, in particular, thanks to the preservation of trust."


Such value-based approaches will continue in the period of country rebuilding. Especially in the context of recovery, the following three topics will be important:

  1. Work with veterans. In Ukraine, there are expected more than 1 million veterans, and companies need to understand how to work with them and their families. Many companies are already starting to focus on this direction and are developing training for their staff on how to work and communicate with veterans. There are specific rules to follow when speaking with veterans, for example, using the phrase "returning to civilian life" instead of "rehabilitation." It is also important to work with recruiters because most veterans do not include their combat experience in their resumes or cover letters, which could be perceived as a "loss of qualifications." There are already initiatives in Ukraine that teach companies how to work with veterans.

  2. Diversity and inclusivity programs. Companies will place an even greater focus on implementing principles of accessibility, employment of persons with disabilities (including veterans, individuals who have become disabled while performing their professional duties, during bombings, etc.), and gender equality (reducing the pay gap between men and women, increasing the share of women in leadership positions, implementing programs for the protection and assistance of those affected by domestic violence and violence based on gender, programs aimed at combining family and professional responsibilities), since women will become the driver of the economy.

  3. Entrepreneurship and requalification for the work of the future and the restoration of the country. Companies will initiate requalification programs and update qualification improvement programs to restore the infrastructure of displaced settlements. They can be offered to both company employees and those who have just started working for the company. Also, companies should invest in the development of entrepreneurship and innovative business formats. Already today, companies are emerging in Ukraine that will deliver medicine by drones, using artificial intelligence, and this will only increase. Therefore, the work of career consultants will become even more in demand. And, of course, there will be an increase in cooperation between companies and universities, and the creation of R&D centres and centres for advanced experience. And this is not about the future, as companies in Ukraine are already creating their innovative centres under the sounds of air alarms and explosions.


Ukrainian companies can teach many things, but the three most obvious ones are: extreme resilience; value-based approaches to working responsibly; and optimism and faith in the army, Ukraine, the companies, and Ukrainians.

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