Knauf Rejects Support for Russia Amid Allegations Over Nuclear Facilities
Suppliers Refusing to Provide Materials for Knauf Due to Russian Ties - Knauf, a construction materials manufacturer, expresses no backing for Russia.
In the midst of increasing scrutiny, Knauf, a prominent German construction materials manufacturer, has firmly denied any involvement in supporting Russia's military efforts, particularly in relation to nuclear facilities. The Company, based in the Franconian town of Iphofen, has repeatedly stated its opposition to Moscow's war against Ukraine.
Monitored Deliveries in Question
The allegation that Knauf has knowingly contributed to the expansion of Russian nuclear weapons bases through direct product deliveries has been flatly rejected by the company. This claim stemmed from a report by "Der Spiegel" suggesting that Knauf materials, such as gypsum or cement, could have been utilized for such purposes.
Withdrawal in Progress, But Delays Persist
Having announced more than a year ago its intention to cease operations in Russia after over three decades, discussions regarding the withdrawal are in advanced stages, according to Knauf. The departure, however, has been delayed due to the complex regulatory procedures and diverse approvals required across various jurisdictions.
Restrictions on Subsidiary Sales
Western companies keen to sell their subsidiaries in Russia face significant restrictions. The Kremlin mandates that such companies can only be sold at a maximum of 60 percent of their already low estimated value, and an additional 35 percent in taxes and duties must be paid.
No Direct Control Over Trading Partners
Knauf asserts that it strictly adheres to applicable sanctions and denies claims of actively helping the Russian state circumvent sanctions. The company's Russian subsidiaries produce all products locally for the domestic market and sell them predominantly to independent construction material traders. However, the subsidiaries have no influence over the traders with whom they do business, leaving the final disposition of their products uncertain.
Unsuitable for Weapons Systems
Knauf's construction materials are neither designed nor suitable for manufacturing or maintaining operable weapons systems. The company maintains no commercial relationships with the Russian Ministry of Defense or its subordinate authorities, and therefore does not sell or deliver products to such locations.
Expansion Plans in Ukraine
Despite facing longstanding criticism for its business in Russia, Knauf has also shown a commitment to Ukraine. The company operates a plant in Kyiv with approximately 420 employees and is currently constructing two additional plants in western Ukraine, one for gypsum plaster and the other for gypsum board.
[1] Source: Der Spiegel[2] Source: Knauf Company Statement[3] Source: Financial Times[4] Source: BBC News
- Russia
- Ukraine
- Moscow
- Despite denying any direct contribution to the expansion of Russian nuclear weapons bases, Knauf faces challenges in distancing itself from the usage of its materials in the industry, given the complexity of the supply chain and the lack of control over trading partners in the business sector.
- In light of increasing scrutiny and the complex regulatory environment, Knauf's employment policy, as well as its community policy, become crucial in navigating the intricate web of trade relations with both Russia and Ukraine, ensuring compliance with international standards while maintaining economic growth and operational sustainability.
