Americans Learn More about Business in Russia

Fifteen MBA students of Global Business from Rutgers Business School, USA, visited HSE in St. Petersburg to participate in a roundtable discussion on the specifics of doing business in Russia.

Fifteen MBA students of Global Business from Rutgers Business School, USA, visited HSE in St. Petersburg to participate in a roundtable discussion on the specifics of doing business in Russia.

The event was moderated by Elena Rogova, Dean of the St. Petersburg School of Economics and Mangement, Tatiana Grishchenko, head of the Management programme, and Alexander Settles, Professor at Rutgers Business School. Representatives of global companies that successfully operate in Russia spoke at the roundtable, including Tom Stansmore, General Director of Emerging Markets Group, and Henri Riihimaki, CEO at Inlook Color SPb. These foreign businesspeople have chosen Russia and St. Petersburg as the location for residence, business development and investment. Russian managers who work in global companies’ offices in Russia also spoke to the students, including Yulia Nikitina, Managing Partner at Boyden Russia, Vyacheslav Varlamov, Head of Procurement and Packing Department at Ilim Group, and Grigory Labzovsky, CEO at Oracle Development SPb.

Tom Stansmore and Yulia Nikitina spoke about the specifics of Russian legislation and taxation during the first session of the discussion. According to Mr. Stansmore, Russia as compared to Western countries is a taxation heaven and an ‘American republican’s dream come true’.

‘Taxes on business here are much lower than in the United States. At the same time, international companies on the Russian market face a lot of procedures, the meaning of which is hard to comprehend. For example, in the United States, it takes hours to open a legal entity, and in this country, it requires days and weeks spent to get approval from various bodies. At the same time, I always tell my clients that they have to ask the right questions, to study the laws and procedures, and follow them thoroughly. I believe that this approach leads to success on the local market. At the same time, I believe that foreign companies’ departures from Russia are not due to the difficulties of the environment, but administration mistakes,’ Mr. Stansmore claimed.

Yulia Nikitina supported him and noted that international companies must be ready to face some unexpected specifics of Russian corporate culture and business communications.

‘I always joke that the biggest problem of foreign companies that recruit Russian specialists is that the Russians look like Europeans, but are not truly the latter. These specifics appear in the work process, which is often a surprise for foreign managers. It is also sometimes a surprise for international partners that many top executives in our country have a background in very different areas, and their careers took off in the 1990s and 2000s. You have to keep in mind all these special features of the Russian business environment if you want to start a business here,’ Ms. Nikitina summarized.

Speakers at the second session looked closer at the realities of today’s Russian market. Henri Riihimaki spoke as a representative of an international business that is experiencing some difficulties due to the falling rouble, since Russia is a sales market for his company. At the same time, Vyacheslav Varlamov and Grigory Labzovsky spoke about the opportunities that are open to companies that manufacture in Russia and export their products.

Mr. Labzovsky also went into some detail on the prospects of IT business in Russia. He emphasized that it is a very promising area in terms of staff potential and comparatively low costs. Mr. Varlamov also recommended the American MBA students who want to develop business in Russia in future to learn Russian, since, according to him, ‘knowledge of Russian opens a lot of doors here.’