Skip to content

Knauf stands firm, facing accusations from Russia over its practices.

Supply Details Revealed in Latest Report

Despite declaring over a year ago their intent to exit Russia, where they had established multiple...
Despite declaring over a year ago their intent to exit Russia, where they had established multiple subsidiaries over three decades, the family-run corporation has yet to execute this withdrawal.

Knauf stands firm, facing accusations from Russia over its practices.

Building Materials Manufacturer Knauf Addresses Allegations Regarding Russia

In the wake of Russia's invasion of Ukraine, Knauf, a German building materials supplier, has come under scrutiny due to its business dealings in Russia. A recent investigation by "Spiegel" has rekindled these concerns, with Knauf vehemently denying accusations of supporting Moscow's war effort.

The company, headquartered in the Franconian town of Iphofen, has refuted allegations that its products, such as gypsum or cement, were used to expand Russian nuclear weapons bases. Knauf contends that itrejects the notion that it knowingly supports the construction and operation of nuclear weapons bases through direct product deliveries.

The "Spiegel" report suggested that Knauf materials could have been used in this manner. However, Knauf maintains it always adheres to applicable sanctions and denies any involvement in helping the Russian state circumvent sanctions. It asserts that its Russian subsidiaries produce all products independently for the local market and sell them almost exclusively to independent building materials dealers.

Knauf announced its intention to withdraw from Russia over a year ago, after more than 30 years of business presence. The withdrawal process is underway but has not yet been completed. The company notes that the regulatory process is intricate, requiring numerous and lengthy approvals in different jurisdictions. Discussions about the withdrawal are being conducted confidentially, and details cannot be disclosed.

Western companies looking to sell their subsidiaries in Russia face substantial challenges, including high discounts demanded by the Kremlin. Companies may only sell at a maximum of 60 percent of the already low estimated value, with additional 35 percent taxes and duties due.

Knauf clarifies that its building materials are neither intended nor suitable for making weapons systems operational or maintaining them. The company has no contractual relationships with the Russian Ministry of Defense or subsidiary authorities. Therefore, it does not sell or deliver products to such locations.

Beyond its actions in Russia, Knauf is also active in Ukraine. The company operates a plant in Kyiv with approximately 420 employees, and construction has begun on two new plants in the western part of the country, a gypsum plaster plant and a gypsum board plant.

The multinational corporation, which ranks among the world's largest building materials producers, has faced scrutiny for years due to its business dealings in Russia. The company consistently maintains that it has not supplied any goods to Russia nor exported anything from Russia since February 2022.

In light of the investigation by "Spiegel," Knauf, a global leader in the building materials industry, has reaffirmed its community policy, stating that it does not support the construction and operation of nuclear weapons bases, nor has it knowingly violated any sanctions. Furthermore, Knauf, with its presence in Ukraine and the ongoing withdrawal from Russia, is increasingly focusing on its employment and business practices within the finance sector, aiming to ensure transparency and adherence to international regulations.

Read also:

    Latest