Stockholm The decision was not easy for her. But Helena Helmersson had to act. The boss of the world’s second largest fashion retailer H&M announced on Monday what analysts had been expecting for a long time: the Swedish group will finally withdraw from Russia. “Because of the current corporate governance challenges and an unpredictable future, we decided today to start conducting our business in the country,” she said.
The withdrawal from the Russian market comes as no surprise. The Russian attack on Ukraine has made it impossible to remain. But like many other Western companies, H&M initially only decided to temporarily close its 168 stores.
However, because there is currently no end to the war in sight and the political climate in Russia has become increasingly difficult, H&M will withdraw from Russia. H&M announced that they would leave the country “in a responsible manner” and emphasized that the Russian colleagues in particular should be treated “fairly”.
H&M has been present on the Russian market since 2009 and employs 6,000 people there. Most recently, Russia was the world’s seventh largest market for the Swedish fashion giant. Helmersson expects withdrawal costs of around two billion crowns (1.9 billion euros). H&M is planning a short-term reopening of its stores in Russia in order to sell the remaining warehouse.
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For the economist Helmersson, the withdrawal from Russia is not the first crisis she has to overcome. Her entry into the job in January 2020 could not have been more difficult: When Helmersson took over the management of the fashion group, the crisis years were over, but the task ahead of her was to expand the online business, which had been neglected until then but was becoming increasingly important.
Fight against the consequences of the pandemic
Helmersson knew from day one that she had a difficult task ahead of her. “We are a company with a 70-year history that has worked successfully with the same business model. Refreshing such an established company is a big task,” she said shortly after her appointment.
The corona pandemic hit even before she had really started with the internal renovation work. The 49-year-old manager immediately felt the consequences: sales and profits fell, but Helmersson, who has worked for H&M in various positions since 1997, including production manager in Bangladesh and later as head of sustainability, counteracted this. Online trading was expanded, was able to compensate for some of the losses, and by summer 2020 the first woman at the head of the group was back in the black.
She has already implemented a lot of what she had planned: The most important thing was the further expansion of online trading, which accounts for a growing share of total sales. So far it has not been able to resolve the conflict with China.
Two years ago, H&M said it would no longer source cotton from the western Chinese region, where human rights organizations say the Uyghur Muslim minority is forced to do forced labor because of possible human rights violations.
Helmersson has not yet been able to resolve the conflict with China
Chinese state media indirectly called for a boycott. Little has changed in the situation so far. Helmersson is covered. You are “in a complex situation,” is her tight-lipped comment.
Employees attest to the mother of two’s great social commitment, which was further strengthened by her several years in Bangladesh and Hong Kong. She has been campaigning for fairer wages and more sustainability in the fashion industry for a long time. “We have to strengthen the workers in their position,” she said some time ago.
Despite some crises, H&M is a Swedish success story that is hardly inferior to that of the furniture store Ikea: Founded in 1947 by Erling Persson in the small town of Västerås west of Stockholm, the company has developed into one of the largest fashion chains in the world.
More: Why German companies can’t just withdraw from Russia