Russian billionaire spent years making connections in New York, and now he has lost everything because of the war in Ukraine

A month ago, Vladimir Potanin, along with the world's financial and business elite, served on the advisory board of the New York-based Council on Foreign Relations and among the trustees of the Guggenheim Museum in Manhattan, reports Bloomberg.

These power circles, which included Tom Hill, the former CEO of Blackstone Inc., and billionaires from Brazil and India, have been cultivated for decades. Now Potanin, Russia's richest man, has no access to them. In the past two weeks, he has been expelled from two management boards.

The nickel and palladium magnate, who is one of the few original oligarchs still active in Russia, has not been affected by the sanctions. Potanin, who has a net worth of $24,5 billion, has been cited as the mastermind behind the controversial "loans for shares" program that led to the privatization of natural resource companies after the collapse of the Soviet Union.

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For much of the past two decades, American cultural arts institutions, non-profit organizations, and educational institutions have been willing to look back on stories of how billionaires with ties to Russia amassed their fortunes. In the case of Potanin, he was seen publicly many years ago with Vladimir Putin, including at an exhibition of a hockey game with the Russian leader in Sochi.

Potanin, 61, now exemplifies how quickly Western bastions of social capital are turning into a campaign to pressure Putin to end the war in Ukraine. While the Russian elite has a number of ways to change its fortunes in response to the consequences, reclaiming its place in these institutions is likely to prove more difficult.

40% of world palladium production

“The reputational risk of keeping an oligarch on an institutional board like the CFR is simply too great right now,” said David Shakony, co-founder of the Anti-Corruption Data Collective, which has researched the philanthropy of billionaires with fortunes linked to Russia. “It will be very difficult for Potanin to regain his former positions.”

Potanin, president of MMC Norilsk Nickel, which accounts for about 40% of global palladium production and 10% of refined nickel, did not respond to interview requests.

The former First Deputy Prime Minister for Energy and Economics under Boris Yeltsin spoke publicly last week for the first time since the invasion of Ukraine, criticizing Russia's response to international sanctions.

“We must look respectable and built, and our efforts must be directed not at 'slamming the door', but at maintaining Russia's economic position in the markets that we have been mastering for so long,” Potanin said on March 11 on the Norilsk Nickel Telegram channel. .

Along with the oligarchs Pyotr Aven and Mikhail Fridman, Potanin is among the billionaires with ties to Russia. They have given more than $2000 million to hundreds of the most prestigious US nonprofits from 2020 to 300, according to the Anti-Corruption Data Compendium. At least $100 million has been awarded to more than 100 organizations in New York City, figures provided to Bloomberg show.

According to Thomas Krens, director emeritus of the Solomon R. Guggenheim Foundation (Solomon R. Guggenheim Foundation), trustees were required to donate at least $100 a year. He recalled that the Russian billionaire constantly supports exhibitions of Russian art and is "silent, not frank" at meetings.

“Many oligarchs saw an opportunity and moved on,” Krens said in a phone interview to build his reputation with philanthropy in the West. “The reaction to this war and to Putin’s strategy was to try to ostracize or draw attention to the money and its origin.”

Meager sanctions

Many New York philanthropists have not been punished. It doesn't stop you from asking questions.

Yancey Spruila, Mr.The chief executive of New York-based DigitalOcean Holdings Inc. was asked last week about Len Blavatnik, the British-American billionaire whose firm Access Industries is the biggest investor in tech company Spruil.

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"I know there's a lot of speculation," Spruil said, adding that Blavatnik received an American education and also that he "was knighted by the Queen of England."

Blavatnik was born in Soviet Ukraine and made a fortune during the Putin era, when the Russian state company Rosneft bought out the energy company he founded. According to Bloomberg Billionaires Index, Blavatnik's personal capital of $36,9 billion exceeds that of Potanin.

“What is happening in Ukraine is unimaginable, and we, together with all compatriots, hope and pray that the conflict ends quickly and that all citizens of Ukraine can again live in peace and freedom,” Blavatnik-owned Access Industries said in a statement. .

Blavatnik has donated to a wide variety of political and charitable causes, including the Central Park Preservation Fund, he has also given money to Carnegie Hall, the Mount Sinai health care system, and has also been a donor to New York Governor Kathy Hokul's headquarters.

Tracking difficulties

The scale of charitable giving is difficult to track, as organizations often do not disclose information about their donors for fear of getting public backlash due to philanthropists' policies or public statements. And while some institutions have asked Russian-connected billionaire donors to step down from their boards, they are not returning funds or closing exhibitions sponsored by such people. For example, the Guggenheim still hosts an exhibition by Moscow artist Wassily Kandinsky sponsored by philanthropists, including Potanin, although his name was removed from the museum's website after the start of the war in Ukraine. The Guggenheim Museum also stated that Potanin had resigned from his board.

Potanin has broad interests: he owns a pharmaceutical firm in Russia, a ski resort, copper mining companies and at least two superyachts.

Having made a fortune for himself, Potanin began to show himself as a philanthropist, becoming the first Russian to join the Giving Pledge, a philanthropic initiative of Bill Gates and Warren Buffett, this happened in 2013. He heads the Hermitage Development Fund and the fund of the State Museum in St. Petersburg.

Potanin has stated that he wants philanthropy to be "more systemic, more businesslike", calling it "a huge, endless space that will never shrink".