Western sanctions against Russia’s invasion of Ukraine have targeted the financial activities and assets of Russia’s oligarchs in the hope that Russia’s super-rich could influence the course of the war.
What about Ukraine’s oligarchs? Ukraine’s super-wealthy businesspeople appear to have set aside their differences to form a united front in defense of Ukraine’s territorial integrity, something they were unable to do in the past. Here’s how it happened and why it matters.
Oligarchs showed divided support in 2014
Ukrainian oligarchs played a contradictory role in spring 2014, when Ukraine first faced Russian threats to its territorial integrity. In the aftermath of Ukraine’s Euromaidan revolution that ousted pro-Russian President Viktor Yanukovych from power, pro-Russian demonstrations spread across Ukraine’s east and south. Russia soon annexed Crimea and, in May 2014, the pro-Russian protests in two of Ukraine’s eastern regions escalated into an armed conflict.
My research on the developments of the pro-Russian unrest in Ukraine’s four eastern regions shows that the strategies oligarchs adopted were a decisive factor in the divergent outcomes in those otherwise similar regions.
In the early stages of the unrest, oligarchs in Kharkiv and Dnipropetrovsk sided with Kyiv and helped those regions avoid a successful separatist uprising. But oligarchs in Donetsk and Luhansk abandoned the area — or went along with the pro-Russian protests to extract concessions from Kyiv. Their actions enabled the separatists and helped pave the way for the subsequent Russian intervention in those regions.
It’s a different story in 2022
In contrast to spring 2014, oligarchs are collectively backing Kyiv. Companies controlled by oligarchs signaled support in line with President Volodymyr Zelensky’s call for Ukrainian unity shortly before the current invasion began.
Ukraine’s richest person, Rinat Akhmetov, announced that his investment company would make a $34 million advance tax payment to help bolster the government’s financial stability. One day before the invasion, President Zelensky met with owners and managers of Ukraine’s top 50 businesses to discuss mutual support in view of the country’s uncertain security situation.
When Russia began its full-scale invasion, companies controlled by oligarchs quickly organized and communicated support for Ukraine. Within the first 12 days of the war, 16 out of the top 20 richest Ukrainians had made statements — personally or through their companies — against Russian aggression or in support of Ukraine. They publicized how they were helping the Ukrainian government and its armed forces, territorial defense, cities and people.
Oligarchs also appear to be cooperating with each other, something they often failed to do in the past. The four largest Ukrainian media groups, each owned by a major oligarch, issued a joint statement on their plans to provide open access to information under martial law. And oligarchs who had problematic contractual relations in the past now seem to be working closely to provide essential supplies.
Why were Ukrainian oligarchs able to overcome their differences?
Oligarchs are fighting for their own survival
Ukrainian oligarchs engage in politics with one primary goal: defending their wealth and property. And a shared commitment to defending their wealth and property has now prompted this far from homogenous group to act collectively.
First, the threat that Russia’s full-scale war poses to Ukrainian sovereignty is also a threat to Ukraine’s system of crony capitalism — where oligarchs profit immensely from close ties to the government. The collapse of that system would hurt oligarchs’ ability to defend their wealth. For example, after Ukraine lost control over Crimea and areas in the Donbas, the new governments there expropriated Ukrainian oligarchs’ assets.
Second, Russian President Vladimir Putin is not in a position to offer Ukrainian oligarchs any credible guarantees. In his prewar address, he spoke disparagingly about Ukraine’s super-rich. More important, Russia’s continuing destruction of oligarchic property and Ukrainian infrastructure greatly diminishes the chances of oligarchs striking any bargains with the Russian president or a pro-Russian puppet regime.
And third, Ukrainians have demonstrated a strong national identity in the face of Russian aggression, while the Ukrainian army has demonstrated both capacity and resolve. Along with the unprecedented support from international partners, these factors suggest that sticking with Ukraine maximizes oligarchs’ chances of preserving or rebuilding their wealth and property.
Oligarchs may play a number of wartime roles
This wealth has already suffered because of the war. Nonetheless, Ukraine’s oligarchs have significant material, positional and mobilizational resources that could help Ukraine fight Russia.
Oligarchic support and unity are important to buttress Ukraine’s economy — and provide assistance to the army, territorial defense units and Ukrainian people.
In towns and cities Russia has temporarily occupied, Ukraine’s oligarchs may be able to boost the resistance. Studies have shown that Ukraine’s oligarchs operate at the core of regional networks that include public officials, politicians, businesses and nonprofits. Oligarchs could use these networks to discourage local elites from collaborating with occupying forces, or organize continued resistance.
As part of a global corporate elite that is politically connected, Ukrainian oligarchs and their companies’ managers could help muster additional support for Ukraine in the West. Oligarchs have been reinforcing old links and creating new business and political ties with the E.U. and the United States since 2014, in line with the changing political and social realities in Ukraine.
There are signs these ties are being put to work — Rinat Akhmetov’s companies called for Russian companies to be suspended from international forums and associations in the energy and steel industries, for instance. And oligarch Viktor Pinchuk recently appealed to Western partners to send more military aid to Ukraine.
Some of Ukraine’s super-rich might also be using their business connections in Russia to help Ukraine. Information about these maneuvers, however, is likely to remain private.
How long will Ukraine’s oligarchs remain unified in their support for Kyiv? That will depend on the ability of the Ukrainian government and army to keep as much territory as possible under Ukrainian control, on continued public support for Kyiv’s military operations, and a high level of international support for Ukraine. While these last, Ukrainian oligarchs are likely to continue contributing to Ukraine’s unified front against Russia.
Silviya Nitsova (@snitsova) is a PhD candidate in political science at the University of North Carolina at Chapel Hill. Her research focuses on the linkages and interactions between big business and politics.