German Technology Giant SAP, Previously Criticized By Zelensky, Announces Russian Exit


Topline

German software company SAP will suspend all business in Russia, the company said in a press release Tuesday, coming on the heels of significant backlash against the company for its Russian business ties from as high up as Ukrainian President Volodymyr Zelensky.

Key Facts

SAP is in the process of conducting an “orderly exit” from its operations in Russia, the company said Tuesday, announcing an end to the support and maintenance of its on-premise Russian software products, its last remaining link to the country.

The support issue came to the forefront last month, when Zelensky said SAP, Microsoft and Oracle and other Western technology companies were backing the “bloody Russian aggressor” by providing support to its products in Russia in a viral March 13 tweet, marking Zelensky’s first direct naming of multinational firms.

SAP had previously paused all sales in Russia on March 2 and announced an end to its cloud computing services March 24.

Key Background

SAP is one of the largest technology companies in the world, with a market capitalization of more than $125 billion. A 2018 Reuters analysis found that 53 of Russia’s 100 largest companies by revenue used SAP services, though revenue from Russia, Belarus and Ukraine accounts for only about 1.5% of SAP’s total revenues. SAP’s Russian clients included several companies hit by international sanctions, a Forbes review found last month. Ukraine’s Minister of Digital Transformation Mykhailo Fedorov accused SAP of continuing to work with sanctioned Russian companies, an accusation SAP denied though it wouldn’t confirm if companies continued to use its technology or support services. Most international companies have completely withdrawn from Russia or suspended operations there according to a list compiled by Yale University professor Jeffrey Sonnenfeld, but Sonnenfeld identified 195 companies, including American conglomerate Koch Industries and French retailers Auchan and Leroy Merlin, who have refused to change their business in the country.

Surprising Fact

Microsoft has not yet announced a suspension to its support services in Russia, while Oracle said in March it “ended” all operations in Russia, including access to customer support and software updates.

Further Reading

Germany’s $120 Billion Software Giant SAP Says It Stopped Working With Russian Banks. Ukraine Demands It Do More (Forbes)

Zelensky Presses Companies—Microsoft, SAP And Oracle—To Punish Russia More (Forbes)

Heineken, Nestle, Renault—Here Are The Companies Under Fire For Russian Ties (Forbes)



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