Good morning, ladies and gentlemen. I am pleased to declare this year's annual general meeting of shareholders of SAP SE open. Welcome. This year, as last, the annual general meeting of shareholders is taking place under unusual conditions due to the COVID-19 pandemic. For that reason, we are once again welcoming you to a purely virtual meeting being held at SAP Group headquarters here in Walldorf, Germany without the physical presence of our shareholders. We know that you, dear shareholders, greatly appreciate the dialogue you had with us, the Supervisory Board and the Executive Board of SAP, at our Annual General Meeting of shareholders . The format of the virtual Annual General Meeting of Shareholders only offers limited opportunities for direct dialogue to take place .
Of course, we will answer all your questions and try to address the comments we received from you in advance of the meeting during this virtual event. To enhance the shareholders' rights of involvement compared to last year, we also made it possible, with respect to this Annual General Meeting, for participants to submit comments in the form of video messages, which we then made accessible to the other shareholders. Another peculiarity of this Annual General Meeting of Shareholders is that it will not, as is customary, be chaired by the SAP Supervisory Board Chairman, Hasso Plattner. This is also due to the COVID-19 pandemic. Mr. Plattner is currently abroad, and in view of the ongoing travel restrictions, it was unclear as to whether and how he would be able to make the journey to today's meeting. He has therefore asked me to chair this Annual General Meeting of Shareholders.
Mr. Plattner has, however, joined the meeting online and will later report personally on the work of the Supervisory Board in the past fiscal year. Ladies and gentlemen, following these preliminary remarks, I now need to announce the formalities of this virtual Annual General Meeting of Shareholders, which are, of course, significantly different from those of an AGM taking place in the physical presence of shareholders. For the record, the Executive Board members, Christian Klein, Sabine Bendiek, Luka Mucic, and Thomas Saueressig are physically present here in the room. Also present in the room is the Supervisory Board Deputy Chairperson, Margret Klein-Magar. The other Executive Board and Supervisory Board members, except Julia White and Aicha Evans, who send their apologies, are following the AGM via the internet. As such, we are complying with the contact restrictions imposed on us as a result of the coronavirus pandemic.
I would like to welcome Dr. Stefan Fellmeth, Notary Public, who is also physically present here in the room and will be taking the minutes. Today's meeting was called with due notice in accordance with the legal requirements and the provisions of the articles of incorporation. Notice of the meeting was published in the "Bundesanzeiger", the online German Federal Gazette on March 31st, 2021. A copy of the notice will be annexed to the minutes. All notices that are required for convening the Annual General Meeting of Shareholders were properly issued. No motions or candidacies were submitted by shareholders to the company. Although there are no shareholders physically present in the room where this virtual annual meeting is held, we are keeping an electronic attendance register. The attendance register lists the proxies designated by the company who are present here in the room.
They represent shareholders who have already appointed and instructed them accordingly, or who do so during the course of the meeting. A printed copy of the attendance register is here in the meeting room. Shareholders who properly applied through their custodian bank to attend the meeting and were sent their voting right card were able to exercise their voting rights in advance of the meeting, either by postal vote or by appointing and instructing the proxies designated by the company. There's still time now for shareholders to use their voting right card to appoint and instruct the proxies designated by the company, or to cast their votes electronically via the password-protected shareholder portal, right up until the executive board has finished answering the questions submitted by shareholders and voting begins.
At that point, I will issue a clear reminder to shareholders that this is their final opportunity to cast their votes or issue voting instructions. This virtual form of holding the Annual General Meeting will still provide for shareholders to ask questions that are then answered at the meeting. In line with the COVID-19 Act, the executive board and supervisory board offered shareholders who properly registered to attend the meeting the opportunity to submit their questions via the password-protected shareholder portal no later than midnight, Central European Summer Time on May 10th, 2021. Questions received in advance of the annual general meeting of shareholders will be answered after the speech given by SAP CEO Christian Klein. In accordance with the legal requirements for the virtual Annual General Meeting, we will of course answer all of the questions submitted.
We will also try to answer these questions in as much detail as we would at an AGM at which the participants are physically present. As I mentioned at the start of the meeting, we also offered shareholders who properly registered to attend the meeting the opportunity to submit their comments via video message in the run-up to the meeting. We made these video messages available to all other properly registered shareholders on the shareholder portal. The objective here is to improve our shareholders' involvement in the Annual General Meeting and ensure greater diversity of opinion. We received two video messages, which have been published on the shareholder portal. I would like to point out that this virtual Annual General Meeting of Shareholders is not only accessible online to registered shareholders but is being publicly broadcast on the internet.
Only what I am saying now, including the report from Hasso Plattner and the speech given by CEO Christian Klein, will be recorded and posted on the internet after the meeting. Ladies and gentlemen, now to the agenda. Let us first take item one. I can report that the following documents were available at the website www.sap.com/investors from the time the general meeting of shareholders was called. The adopted SAP SE financial statements, the approved consolidated financial statements, the combined management report from the SAP group and the SAP SE, including the compensation report and the executive board's explanatory notes relating to the information provided pursuant to the German Commercial Code Sections 289A1 and 315A1. The supervisory board report and the executive board's proposed resolution on the appropriation of retained earnings.
These documents are here in the meeting room, and they can also be accessed on our website for the duration of this meeting. The auditor, KPMG AG examined the SAP SE financial statements, the consolidated financial statements, and combined SAP SE and SAP Group Management Report for fiscal year 2020, and issued an unqualified audit opinion. The supervisory board reviewed the aforementioned documents and approved them on February 24th, 2021. The SAP SE financial statement for 2020 were thus formally adopted. I'd now like to ask Hasso Plattner to report on the focus of the supervisory board's work in 2020.
Dear shareholders, ladies and gentlemen. Let me start by welcoming you all to this year's Annual General Meeting. Now, I'm in California, and the light is right above me, and I've got to admit, we tested out everything beforehand, but what we did not take into account was the fact that this AGM takes place in the middle of the night here in California, and that's why I'm looking somewhat different than the way you would see me in a professional TV studio. I apologize for this. The ongoing pandemic situation has again prevented us from holding a meeting at the SAP Arena in Mannheim as we've done in the past, and for this reason, I was again unable to travel to Walldorf.
However, this virtual forum also makes it possible for me to join you today from here and to report on the work of the Supervisory Board in my capacity as the Chairman of the Supervisory Board. I would like to thank Friederike Rotsch for chairing a meeting as she did last year. Because I cannot take on this task remotely because the legal framework of a virtual Annual General Meeting does not permit this, I would like to take this opportunity to address some of the issues the Supervisory Board and I, as its Chair, dealt with in the last year. You will find our detailed Supervisory Board report published in SAP's integrated report to which I refer here. As far as the nature of our work is concerned, our Supervisory Board meetings, as well as this AGM, were held primarily virtually due to the pandemic situation.
Even with these changed conditions, we have remained in constant communication with the executive board and also with all supervisory board members and have continued to perform our monitoring and advisory duties conscientiously. As far as the topics are concerned, first and foremost, it is the ongoing pandemic situation, which has, of course, also had a major impact on SAP, its customers, and all our business operations. Christian Klein will go into this in more detail in a moment. Even though I believe SAP has come through the pandemic well so far, it has presented our company, the executive board, and all our employees with major challenges. All business processes had to switch to a virtual format virtually overnight. The vast majority of our employees have been working from home offices since the outbreak of the pandemic.
My sincere thanks goes to all our employees for ensuring that this continues to work so effectively. Among our global customers, this has decisively reinforced the trend towards the cloud, a trend to which SAP also had to respond. As a result of the pandemic, SAP has vigorously accelerated the transformation into a cloud company it had already embarked on earlier. The Executive Board adjusted its strategy in the fall and coordinated this step closely with the Supervisory Board. Even though this move was painful for us shareholders in view of the strong share price reaction, I still believe it was the right move. Believe me, as SAP's largest single shareholder, I clearly felt the impact of this strategy adjustment on the value of the SAP share.
This move gives us the ability to act now, which we need, in order to drive our transformation to a cloud company even faster. Even if this announcement in October unsettled some investors, I am convinced that this will serve the success of our customers and thus also of our company. I therefore call upon you to trust the Executive Board on this journey to implement our strategy. The implementation of this strategy was also supported by the changes we made to the Executive Board last year and at the beginning of this year. Even though this has unintentionally led to a number of changes on the Executive Board recently, which unfortunately dominated the public perception of SAP, it has restored calm in the management. We've been able to strengthen the Executive Board very well.
With her experience, Sabine Bendiek as Labor Relations Officer, Chief People Officer, and Chief Operating Officer, is already providing important impetus to the company. With Scott Russell, who's responsible for customer success, sales, and advisory, and Julia White at the helm of marketing, communications, and solutions, the strong international character of our company is once again represented. All three will be introducing themselves to you in a moment. From the supervisory board's perspective, we have now a management team that is fully committed to pursuing and implementing our corporate strategy as a team. This makes me very confident about the future of SAP, in spite of all of the uncertainties we are currently experiencing. I also would like to thank Adaire Fox-Martin, who left the executive board at her own request.
She worked at SAP for many years in various positions and regions, most recently as the Member of the Executive Board responsible for Customer Success, which is the area which is now headed by Scott Russell. Let me also briefly touch on the subject of Executive Board compensation. At last year's annual general meeting, we presented our compensation system in accordance with the new rules of the German Stock Corporation Act for approval. Excuse me. This approval was granted by a large majority of shareholders. Nevertheless, there was also criticism of individual elements of the compensation system. The Supervisory Board addressed this criticism in the follow-up of last year's AGM. We were unable to respond to all of the criticism because some of the demands made by investors actually contradicted each other.
In response to the criticism voiced, we have further increased the transparency of our compensation report, and we will continue to communicate with investors to discuss and examine any further need for change. The enormous economic consequences of the COVID-19 crisis also affected the compensation of the Executive Board. The targets for the short-term incentive, STI, which is the short-term performance related compensation, which was set at the beginning of last year, even before the outbreak of the COVID-19 pandemic, could not be achieved, so that no annual bonuses were paid to the members of the Executive Board. While the Executive Board adjusted targets for the employees' bonuses due to COVID-19, the Supervisory Board did not follow suit for the Executive Board members. Excuse me. The Supervisory Board did not follow suit for the Executive Board members.
However, in the Supervisory Board's view, the Executive Board members made the right decisions over the past year in addressing the challenges posed by the pandemic, and they led SAP well through this crisis. Despite all the negative economic effects, SAP had a solid year. Without resorting to short-time working or government aid packages, we are therefore in a position today to propose to shareholders the payment of an increased dividend compared with the previous year. For this reason, the Supervisory Board has decided to reward the outstanding performance of the members of the Executive Board in this exceptional year with an additional compensation, which is meant as a positive signal for the current members of the Executive Board, not for those who have left. It is also important to us that this exceptional move is also taken in line with the interests of the shareholders.
The net amount of the additional compensation must therefore be invested by the Executive Board members in SAP shares, and these shares must be held for three years. We think that this move is appropriate in view of the special circumstances in which we currently find ourselves. Ladies and gentlemen, looking at today's agenda, I also would like to address the future composition of the Supervisory Board. With Qi Lu and Rouven Westphal, the Supervisory Board is proposing two new members for election to the Supervisory Board. The two candidates are to replace Diane Greene and Pekka Ala-Pietilä, who are leaving the Supervisory Board. Diane Greene already in December, Pekka Ala-Pietilä at the end of this Annual General Meeting. Allow me, first of all, to take this opportunity to thank both departing members of the Supervisory Board cordially for their work.
Diane Greene, with her technology expertise, has brought the important Silicon Valley view to our supervisory board, which is very important in our industry. Pekka Ala-Pietilä, over many years together on our supervisory board, I have come to appreciate as a valuable, prudent, and level-headed advisor. We think with Qi Lu and Rouven Westphal, we can gain new important impulses and expertise for our supervisory board. Qi Lu brings extensive technology experience from the U.S. software industry and can become an important advisor to the executive board for the increasingly important Asian market. As he has already been temporarily appointed as a member of the supervisory board by court order, he has already been able to prove this. Rouven Westphal brings extensive experience and knowledge in the area of technology as well as finance and accounting, and knows the SAP business and the competitive environment very well.
Both candidates will introduce themselves in a personal video in a moment. I'm sure that both candidates will be strong, independent voices on the supervisory board, and I would like to ask for your support for these two election proposals. Ladies and gentlemen, I would like to conclude by addressing a personal topic that I am increasingly being asked about in my discussions with investors. It is about my personal succession. As you all know, I have been with this company from day one. I founded it from nothing with a handful of colleagues, spent many years on the Executive Board, and I think I can say this with pride, together with many dedicated colleagues, shaping it into a global company. Also in my current role as Chairman of the Supervisory Board, I've made my contribution to ensuring that this company continues to grow and flourish.
It now remains for me, as the last active founder in the company, to ensure that this role is also successfully handed over to the next generation of managers. Rest assured that I'm already working with the supervisory board to set the course for this. I'm doing this my way, with deliberation, calm, and with heart and soul for this company, because SAP's success comes first for me. SAP is currently in a very important and critical phase on the path to transformation into a cloud company. After the recent leadership changes on the executive board, it is now particularly important to ensure stability and continuity in the management of the company.
For this reason, I already announced at last year's AGM that I plan to stand for re-election one last time for a further two years in 2022, when my current shortened term of office expires, and I am thus only aiming for a full term of office totaling five years. In this way, I would like to accompany the Executive Board during this critical phase of the transformation and avoid unrest caused by another change of leadership. This will also give me the opportunity for a calm and coordinated handover to a successor. From my point of view, my succession on the Supervisory Board has been and is assured at all times. However, I do not want to be a lame duck. I will inform you of all of the specific details in due course.
At present, I expect this to happen at least six months before my last Annual General Meeting. I kindly ask you for your support on this path. Thank you very much, and I wish you a successful AGM.
Thank you for your report, Hasso. Ladies and gentlemen, as Hasso Plattner already mentioned, the Executive Board welcomed three new members since the last Annual General Meeting. The Supervisory Board appointed Sabine Bendiek to the Executive Board with effect from January 1st, 2021. Ms. Bendiek currently serves as Labor Relations Director and Chief People Officer and will assume the additional role of Chief Operating Officer on July 1st of this year. I would like to welcome Sabine Bendiek to the meeting and ask her now to briefly introduce herself to our shareholders.
Yes. Thank you, Friederike, and thank you, Professor Plattner, Hasso. Dear shareholders' representatives, ladies and gentlemen. I'm very grateful for the opportunity to introduce myself personally to you all. It's a great honor for me to have joined the Executive Board of SAP SE as of January of this year.
I moved from Munich, but still I'm quite familiar with the Rhine-Neckar region. I went to school in Heidelberg, got my Abitur there, studied for my bachelor's degree in economics in Mannheim. After several years of work, I got a master's degree in management science from the MIT in 1996. I have considerably more than 20 years of professional experience as an executive in the technology industry. Before joining SAP, I was chairwoman of the management board at Microsoft Germany. Before that, I also held the position of vice president and general manager for EMC Germany. Prior to that, I was responsible for Dell's small and medium business in Germany, Switzerland, Austria, and U.K. At the beginning of my career, I worked for McKinsey, Booz Allen, and Nixdorf Information Systems, and also at Joint Venture Capital.
As Chief People Officer and Labor Relations Director, I head the HR organization. Thus, it is my task to bring SAP's global people strategy to life. As of July, I will combine, as Professor Plattner has just said, the roles of Chief People Officer and Chief Operating Officer. With that, I have to bring the two areas together, people and processes. As Chief People Officer, it is my job to prepare our employees for the challenges of the digital transformation. Also, I have to prepare them to develop our role as a support to our customers so that they can live up to their challenges. As Chief Operating Officer, I have to ensure that all our processes are agile enough to respond to this new agility and to the customer's expectations.
In this sense, these are two sides of the same coin because we are the front-runner in the field of technology. Finally, all that remains for me to tell you is I'm looking forward to many successful years in a great management team in the Executive Board. I would like to thank you, dear shareholders, and all of you, my colleagues of the Management Board, and you, the members of the Supervisory Board. I would like to express my thanks for the trust you place in me. I wish us all a successful Annual General Meeting. Thank you.
Thank you, Sabine. Once again, welcome. On February 1st, 2021, Scott Russell took over the Customer Success board area. On March 1st, Julia White was appointed Chief Marketing and Solutions Officer.
Both executive board members reside abroad and are unable to be here on-site due to the ongoing travel restrictions. They would each like to introduce themselves to you in a short video.
I'm Scott Russell, Member of the Executive Board and head of our Customer Success division at SAP. Thank you so much for the opportunity to connect with all of you today. I've had the privilege of taking on the position in February of this year, and with it, the responsibility for leading the execution of SAP's Customer Engagement Strategy going forward. As an Australian native, I've spent the bulk of my career helping organizations of diverse size, industry, and geography choose, deploy, and extract the greatest possible value from their technology investments. A lot of who I am professionally was shaped early in my life with my parents, who both took career choices that helped them give back to their communities. My father spent much of his life helping those afflicted with physical disabilities. While my mother served decades in healthcare.
They both instilled in me a sense of service in everything that I did and still do. As a young boy on my paper route, I made sure I spoke with each household and the customers to understand where they prefer their paper each morning as they started their new day. Fast-forward to the IT industry, I began by working for some of SAP's most strategic systems integration partners, where I had numerous opportunities to apply this service to customers' business outcome. For the past 11 years with SAP, I've been trusted to lead functions, markets, and regions in delivering value at every touch point along the engagement life cycle for literally thousands of our customers.
This immersion across the breadth of the customer value chain has helped prepare me and my team of nearly 40,000 sales, services, and customer engagement specialists for the ultimate ambition, to help all of our customers transition to and transform in the cloud at unprecedented scale, and derive the greatest possible value and the best possible experience from their investments in SAP. This aspiration excites me to the very core. Our customers are primed for the shift, not only running their lines of businesses, but also moving their mission-critical and differentiating processes to the cloud at scale. SAP is facilitating this move through substantial investment in our customers' long-term success. More innovation, improved integration, heightened security, enhanced reliability, and of course, availability across all of our solutions.
Working with teams across all of our board areas and our extensive ecosystem, Customer Success has orchestrated itself to help our customers and SAP grow in the cloud. Our goal is to continually simplify the buying experience for every one of our customers, finding faster ways to deploy solutions across their business, and support them by deriving the greatest possible value from their investments over the long term. The premise is simple. SAP is only successful when our customers are successful, and we will constantly improve upon this motion to help them become intelligent enterprises and our strongest and most important advocates. We will continue to build upon the very proud heritage of what has set SAP apart for nearly five decades, our deep customer relationships. Especially in the last 12 months, we have been there for our customers when they needed us the most.
We will continue to be there for them, too, as economies and industries return to what I'm confident will be a more sustainable and a more inclusive growth. Our customers' success, SAP's success, and our shareholders' success is more tightly intertwined than ever before. I firmly believe that the way we work with our customers and what we help them achieve today demonstrates more than ever both shareholder value and our shareholders' values. Thank you so much for your continued trust in SAP. I really do look forward to joining you in person at the next event. Until then, I wish you all the very best. Stay safe, stay healthy, stay well.
Hi, I'm Julia White, the newest member of the executive board, and I'm thrilled to be at SAP. From a career perspective, I've literally been working in cloud technology my entire career. My first job was in online banking before the internet was considered safe for banking. Just a few short years later, people couldn't imagine a world without banking on the internet. This rapid pace of change and continual reinvention is why I love technology, and I've spent my entire career in this industry. Before joining SAP, I spent nearly 20 years at Microsoft. I was one of the initial leaders helping drive the Microsoft Office products to the cloud and become Office 365. Over the course of about 10 years, we transitioned a multibillion-dollar on-premise software suite into the world's biggest SaaS business on the planet.
We had to go through massive internal change to make this transition, and I had the opportunity to be on the front lines of exactly what this transformation required. Following that, I spent my last five years leading product marketing for Microsoft Azure. When I began that position, Azure was just a few hundred million dollar business, and we were nearly six years behind Amazon. After the next few years, we grew the business, doubling it in some years, to deliver it to now being a multibillion-dollar business today. These are just a couple of the transformation and growth experiences I have been fortunate enough to be part of, and I'm really excited to bring these experiences now to SAP. There's so much growth potential across SAP. Now to my new board area.
I like to say that we'll be the third leg of the stool that gives us balance in partnership with engineering and Customer Success. Ultimately, my new organization needs to help deliver growth for SAP. We'll do that in a few ways. First, partnering closely with the engineering organizations to ensure we're identifying our differentiated customer value aligned with our innovation priorities. Inspiring and delighting our customers with the compelling value of SAP solutions. Of course, supporting our sales and partners with the resources, programs, and offers they need to exceed their targets, both in revenue and in adoption. Thank you so much. I hope to meet you in the future.
Ladies and gentlemen, I now call on SAP's CEO, Christian Klein, to address you. His speech was published on May 4th on our Annual General Meeting website.
Ladies and gentlemen, dear shareholders, colleagues. I welcome you to the SAP SE Annual General Meeting of Shareholders. Once again, it's a virtual event, but health and safety, of course, take absolute priority. Nevertheless, I hope very much that next year we can come together in person again in the SAP arena. 2020 was very successful for SAP despite the coronavirus pandemic. For this, I would like to sincerely thank our more than 100,000 people around the world who give their best day in, day out. I'd also like to extend my thanks to our supervisory board for its advice, foresight, and confidence in SAP's management. Last year, we didn't just demonstrate just how resilient and effective we are, even under the toughest of circumstances. We also set the course for continued success. That's what I would like to talk about today.
Our lives and businesses will stay challenging for quite a while yet. Our thoughts go out to all those who have been particularly affected by the pandemic, and our thanks to all those who are making extraordinary contributions to our communities. We are seeing light at the end of the tunnel. We hope that we can soon start offering vaccinations at SAP for our colleagues and their families. Using our own facilities and company doctors will perhaps also help ease the burden on vaccination centers and local doctor's practices. We're looking ahead, and we have a solid foundation to build on, a foundation that we have continuously strengthened since the company's inception 49 years ago. 2020 was no different. Cloud revenue increased by 18% and continued to be the major growth driver. A decrease in business travel impacted the transactional revenue in our Intelligent Spend business.
Excluding this effect, cloud revenue grew by 27%. Current cloud backlog, the contractually committed cloud revenue SAP expects to recognize over the upcoming 12 months, increased by 14%. This result shows just how successful we are in the cloud because it reflects committed revenue from new contracts and from contract renewals. Total revenue, meanwhile, grew 1%. This shows that with all our success, we are still in the middle of the transformation of our core business. Operating profit increased by 4%. Gross margin of the cloud, which is an indicator of how efficient our products are in the cloud, increased by 1.4 percentage points. Operating cash flow, an indicator of whether a company can finance important investments from internal resources, doubled since last year to EUR 7.2 billion. We also got off to an excellent start in 2021.
In new cloud business and software licenses, we recorded the fastest growth in five years. Our portfolio is performing exceptionally well, and we're capturing ever more market share, and that's just the beginning. Our innovation pipeline and our network of more than 22,000 partners are stronger than ever. All of this is proof positive that our strategy is spot on. All the signs point to robust growth in the cloud. Yet a foundation is more than just numbers. What else did we accomplish last year? We listened to our customers. We responded, and to take one example, made fantastic progress in the integration of our solutions. We continued to strengthen our portfolio. We focused on the areas where we clearly stand out from the competition and divested others that were not part of our core business. We successfully took Qualtrics public and laid the foundation for further growth.
Qualtrics' market capitalization is around $20 billion , more than double the original purchase price. We invested further in security. Day after day, customers entrust us with their data. That is why we subscribe to the highest security standards. We extended our partner network because together we're stronger. We co-innovate with other market leaders such as Microsoft, Google, Siemens, Honeywell, and Bosch for everyone's benefit. We have made SAP more efficient, not just on the product side, but internally as well on an organizational level. We merged our sales and service teams into one board area, which means each customer now has just one contact company-wide. There have also been some changes on our Executive Board since last May. In Julia White and Sabine Bendiek, we have brought two top executives with strong cloud expertise onto our Executive Board. Julia, Sabine, a warm welcome to both of you.
Adaire Fox-Martin decided to leave SAP after 13 successful years at the company. Scott Russell has taken over responsibility of our global sales business, focusing on the long-term success of our customers. Sabine, Julia, Scott, I wish you all the best and every success with the tasks ahead. Ladies and gentlemen, 2020 saw the world turn upside down. It was a very tough year for individuals and for businesses. The pandemic has massively accelerated the trend towards digitalization. The shift from analog to digital has been underway for some years. This increased pace of change has been forced on entire industries, which might have preferred a slower pace in other circumstances. All the customers I spoke to said one thing.
They want a fast and easy route to digital transformation because digital technologies are helping them overcome the pandemic, and the companies that have already digitalized their business models are coping better with the current situation. The cloud has a major role to play here because of its many benefits. Chief among them is flexibility and an even better access to data, to knowledge. Cloud services make employees more productive because they can easily work from anywhere. Work from home during a lockdown? No problem. Cloud services also enable companies to react faster, even when the unexpected happens. Long before the pandemic began, we were helping our customers migrate to the cloud, but suddenly we had to move much faster. The pace became faster for our customers and for SAP, because the alternative would have been for customers to go ahead without us.
For us, one thing was absolutely clear: We had to respond decisively to the needs of our customers. Otherwise, SAP wouldn't have had a future. That is why we adjusted our strategy to make moving to the cloud even faster, even easier, and even more efficient. That's why we are investing in an even better infrastructure and particularly into innovation. I'll come back to that in a moment. Clearly, this decision has a financial impact. Because we're taking our business into the cloud, profits are shifted into the future. How come? In the past, when customers purchased software licenses, they paid the full amount upfront when they signed the contract. In the cloud, there are no one-time upfront payments. Instead, customers pay as they go or buy a subscription.
This means we have accelerated growth and recurrent profit, but in the transition phase, this slows down our overall profit growth. This is a transitional phase, which will be over at some point, and then our revenue and profit growth will accelerate, and we are expecting double-digit growth. All of that has had an impact on the SAP stock price. I know that for you, our shareholders, this hasn't been easy, but it was the right decision. It was the right decision to work on our strategy because our growth potential and our success cannot be sacrificed just to optimize margins. That would undermine trust in SAP. Building long-term value for you, for our customers, and for SAP is our absolute priority. In 2020, again, we paid a high dividend and returned EUR 1.5 billion to our shareholders under a share buyback program.
For fiscal 2020, we have proposed a dividend of EUR 1.85 per share. This is an increase by 17%. Over the past 10 years, our stock price has increased by 11% on average, and since the beginning of this year, it has risen by more than 7%. SAP is a good investment for sustainable long-term growth. Let me show you why. Number one, our people. SAP is a global company. Our people come from and work all over the world, just like our customers. They are at the heart of our success because they give their all every day and have more than risen to the challenges of the crisis for our customers and for you, our shareholders, and for society as a whole. Take our colleague Dimitri. Outside of work, he takes care of COVID-19 patients in intensive care units.
Grace, who has collected more than 3,000 kg of food for families in need. Marika and Joaquin are helping ensure that young people have access to education during the lockdown. Take the people who, in record time, built apps that find hospitals with free bed capacity across the country. All those who have collected money and medical supplies or were simply there for those who needed the most. SAP is full of examples like these. That makes me proud. So does the fact that employee satisfaction has risen to a record high of 86%, despite the pandemic. We know that our people have made this company what it is today. We also know how challenging these uncertain times are, which is why we are investing in initiatives for health, but also in monetary rewards. We want to recognize our employees' outstanding performance.
One of the ways we are doing this is through the additional stock plan we set up. That takes me to number two: Focus on customers. Our customers come first. They are at the center of what we do. Always, every product, every service, every process is built around them. Last year, I promised you new licensing models and clear business value for our customers. Fast and agile delivery with innovations in the cloud. We delivered. The proof? In 2020, our customer satisfaction increased significantly by 10 points on the year before. One reason is that our solutions are now better integrated, and we want to push our score even higher by focusing even more closely on the needs of our customers and implementing them with agility. Customer satisfaction is a measure of our success. Since 2020, Executive Board remuneration has been linked to it.
The crisis has shown once more that we are the reliable partner for our customers. Our software has helped develop and distribute vaccines, making supply chains more resilient and adapt business processes, skill our people, and we've enabled companies to offer employees and customers what they need. In short, we've helped businesses and society to keep on going and to keep moving forward. Let's run the film. Since 1972, SAP has changed the way companies work, always at the side of our customers. We were there during every step as partners, drivers of their transformation, and by giving ideas. Now we've reached a turning point. Even before the pandemic, digital transformation was very high up on the agenda of companies because challenges are increasing. The climate change is happening. There is social unrest. Inequality or changing global trade relationships are only a few examples of many.
In a world where change is the new reality, companies need to keep changing along with the changes that are happening. No matter whether we're talking about companies, national economies, or networks, SAP supports you with its experience and technology for stable supply chains, robust networks, supply chains, financials, dedicated staff, excellent production, personalized action, or new business models that need to be implemented. When Frostkrone changed or wanted to change the food industry, they built an intelligent platform based on blockchain analysis solutions and artificial intelligence. This is how Frostkrone can use real-time data to trace where the ingredients for their products come from and how they're processed. When COVID-19 stopped trade in stores, Casey's revolutionized their offerings with a mobile app and even increased revenue.
When the pandemic turned the world upside down, pharmaceuticals companies like CureVac and Moderna produced a vaccine within one year, and we are providing the right network to support all projects, all transactions with maximum transparency. One thing is for sure, companies need to be resilient, profitable, and sustainable more than before in order to stand up to the challenges today. The opportunities were never greater to improve people's lives. Never was it more important to become an intelligent company, and we of SAP show you how we can do this together. I think that video shows us quite well what SAP stands for, and that takes me to my number three, innovation. Innovation, hand in hand with our customers. This has made SAP great. The foundation of our portfolio is SAP HANA, our database for data-driven decisions and actions in real time.
Last year, we picked up the pace of innovation once again. We built trust. How? By listening. What do our customers need? How can we support them even better during the pandemic and beyond? One example is RISE with SAP, our new offering that allows companies to transform holistically. Why is this so important? Think of the shops in your town. Until last year, retail outlets were doing well. The first lockdown happened. Online shops had to be set up and quickly, or vaccine logistics. It is not just about making the IT more efficient. The entire process from production to vaccination has to be as short as possible. Digitalization is more than just transferring analog processes into the digital world one to one. Companies have to optimize their processes and business models, tap into new markets and sectors.
They will not achieve this by simply migrating their IT environment into the cloud. They must also completely transform their business processes. That is exactly what RISE with SAP does. It doesn't just get your company started in the cloud. It brings together the best of SAP and our partner network, our experience from working with hundreds of thousands of customers, our insights into business processes across 25 sectors, our market leading technologies and services. The core components of RISE with SAP are our intelligent ERP, SAP S/4HANA Cloud, and our SAP Business Technology Platform. It also encompasses services, consulting, and analytical functions to build intelligence into business processes. No matter where our customers are on their digital journey, we are on hand to provide individual tailored solutions. A single package from a single source. Only SAP can do that.
Because we know how business processes must run in order to be successful in this digital age. We're always trying to improve. To become even better here, we've acquired Signavio. At the beginning of the year, this was. We made it part of our portfolio of solutions for business process management. This solution is part of RISE with SAP and helps identify and remove possible workflow weaknesses. RISE with SAP is just one example of innovation. We are also improving our infrastructure. One aim being to ensure we achieve the highest cybersecurity standards. We are migrating our transactional applications, such as the function employees use to enter a leave request to the cloud, and we are enriching them with smart features powered by artificial intelligence. We are building on the strength of our core applications.
Together with our partners, we are expanding our solutions and creating groundbreaking functionalities. For instance, we are working with Microsoft on enabling MS Teams and SAP applications to share data. SAP is combining the business software with a collaboration platform, so users don't have to switch between individual applications anymore. This is how we're making employees more productive and shaping the future of work. We have made huge progress on integration, and we will continue working on this in 2021 because only an integrated company is an intelligent company. This is where our SAP Business Technology Platform comes in. It allows us to integrate, build, and extend applications easily. We offer pricing models with maximum flexibility, be it pay-as-you-go, a prepaid model similar to those we know from mobile phone service providers, or the classic subscription model. SAP Business Technology Platform is also where our modular industry-specific cloud solutions reside.
Together with our partners, we create solutions that allow our customers to adjust their processes to suit their individual requirements. Every company is unique. A good example of this is our joint venture with the investors Dediq. Together, we will build industry solutions in the cloud for banks and insurance companies based on SAP technology and embedded in our portfolio. This is not a blueprint for other industries. It is our way to make the most of the huge opportunities in the financial services market. No company is an island. With the SAP Business Network, our customers can manage complex supply chain networks with all parties in real time. If your usual business partner can't deliver, you need a plan B quickly. We go one step further.
We help our customers ensure that human rights are adhered to, that their supply chains are free of child labor, that their suppliers meet their own sustainability standards. Let's stick with the topic of sustainability for a bit. When you buy a washing machine, it's simple. The greener the eco rating on the scale from A to G on the label, the more energy efficient it is. We are now applying this principle to the carbon footprint of products and services. We are embedding sustainability into our applications. We show the entire carbon footprint of a product and make it comparable end to end. The carbon footprint of suppliers, emissions from factories, offices, energy use, waste, business trips, and transportation of goods. We include all direct and indirect emissions involved in the manufacturing and shipping of products to the end customers.
Hundreds of thousands of companies all over the world rely on our software to run their supply chains, personnel, and business networks. Now, they can use this data not just to manage revenue and operating profit, but also to make climate protection measurable. Because sustainability is more than just climate protection, our solutions also help promote diversity. How diverse is my company? How can I reach out to underrepresented candidates? Do I really pay fairly? How diverse is my leadership team? We can answer all these questions. Number four is corporate social responsibility. The challenges we faced over the last year reconfirmed the relevance of SAP, as well as our extensive responsibility and the impact we can have on the economy, on society, and on the environment. We are proud to support the global fight against COVID-19.
Our vaccine collaboration hub helps ensure vaccines get to where they're needed safely and efficiently. The Corona-Warn-App has been downloaded more than 27 million times. It has alerted some 3 million people of possible exposure to the virus, and it has helped detect many COVID-19 infections. 17 of the top 20 global vaccine producers run SAP systems. We also support many logistics companies and organizations around the globe that are at the forefront of vaccine distribution. Vaccination, the global challenge. When COVID-19 started changing the world and our lives, scientists got up and got to work. The pandemic started, and we started developing our mRNA-based vaccine immediately. They were made available in record time, but the race against time continues. There are people all over the world who need to be vaccinated everywhere. This is an unparalleled logistical challenge. It is a big challenge in fighting the pandemic.
Vaccines are sensitive. In order to store them safely and to distribute them reliably, we need a stable global network and the right equipment and transparent processes and dedicated staff. We need SAP solutions to make our vaccines on a global scale. SAP technologies and solutions support upscaling of production and global distribution of vaccines monitored by administrations to bring the vaccines to doctors and to users. Producing billions of syringes and vials, packaging the material, and bringing them to the different patients. Together with SAP, we developed the first solution that complies with all requirements. This is decisive in getting the vaccines to the patients. Wacker supports the fight against COVID-19. SAP is extremely important for our supply chain, and it makes sure that our processes always perform well. The SAP Collaboration Hub provides end-to-end transparency and tracing, and SAP was part of it.
Everyone can concentrate on their task and communicate with their partners across the whole chain, from planning, manufacturing, to storage, to transportation, to delivery, to tracing, to checking, to administering the vaccines. The solutions enable us digitalized planning and also materials management and delivery in order to protect people, stabilizing the economy, and to bring us all together again, finally. We are fighting for a society in which social justice and equality are a given. In 2020, we held digital skill-building and coding programs for more than 2 million people from socially disadvantaged groups. We are partnering with UNICEF on a curriculum that will give young people the skills they need for the jobs they want. We support nonprofit organizations and social enterprises. We are entering into new partnerships. We are building digital solutions that help tackle some of our biggest challenges, such as climate change and social inequality.
There is no place for racism or discrimination at SAP in any form whatsoever. Within the next three years, we want to double the percentage of Blacks and African Americans in the workforce in the U.S. 27.6% of our managers are women, and that number is rising. We remain committed to reaching our goal of 30% by 2022. This year, Pride at SAP, our network for lesbian, gay, bisexual, transsexual, and intersexual people, celebrated its 20th anniversary. More than 200 people who have autism work at 34 of our locations in 16 countries. We're also moving faster on climate protection. I spoke earlier about how we're helping our customers achieve their climate targets, we want SAP to be a pace setter itself.
We will become carbon neutral in 2023, two years sooner than planned. Ladies and gentlemen, 2020 was a successful year for us despite the coronavirus pandemic, and we expect 2021 to be a successful year, too. After a strong first quarter, we even raised our guidance. Vaccination programs are rolling out all over the world. We believe the demand environment will gradually improve in the second half of 2021. We expect cloud revenue to grow by 14% and 18%, cloud and software revenue to reach between EUR 23.4 billion and EUR 23.8 billion, operating profit to be between EUR 7.8 billion and EUR 8.2 billion. The share of more predictable revenue, the total of cloud revenue and software support revenue, recurring revenue that is, to reach approximately 75% of sales revenues. We expect our cloud revenue to nearly triple by 2025, reaching more than EUR 22 billion.
We are well on our way to achieving our midterm goals. Dear shareholders, over the past year, many of us have wondered how it's possible to stay operational when certainty is an illusion and the extraordinary is the new normal. We've shown that we are successful even during this crisis, and we have everything it takes to be successful in the future, too. Focus on innovation, the broadest product portfolio, a strong customer base, reliable partners, and people who give their best every day. We have a unique opportunity to guide our customers on their journey into the digital world, and we're seizing that opportunity.
Ladies and gentlemen, you can count on us to continue putting our customers first, to accelerate the pace of innovation further, to give our employees an environment that encourages and supports them, to foster lasting social equality, to deliver long-term value to you, our shareholders. Take my word for it and measure me by my words. I'm excited about shaping SAP's future success with you. Next year, SAP will celebrate its 50th anniversary. I believe that our company has never been more relevant because we are reinventing the way business is run, because we are making economies of the world run better, and certainly because we are improving people's lives. SAP has a big heart. Thank you very much.
Thank you, Christian, for these interesting insights. I am now calling, in addition to item one, all other agenda items. That is to say items two to nine that you have found in the invitation to the meeting that is available in the Bundesanzeiger and on our website, and which also contains the management's proposals. On your screen, you can now see an overview of the agenda items for today's AGM. These include, among other things, the resolution on the appropriations of the 2020 retained earnings, the resolution on the formal approval of the act of the executive and supervisory boards in the preceding fiscal year, the appointment of the auditor for the current fiscal year, and also two by-elections for the supervisory board. As already explained by Mr. Plattner, Dr. Qi Lu and Dr. Rouven Westphal are standing for election as successors to Diane Greene and Pekka Ala-Pietilä, respectively.
Travel restrictions once again preclude the candidates from introducing themselves personally. Both gentlemen have prepared a short video instead.
Hi, my name is Qi Lu. I'm the founder and CEO of MiraclePlus, a startup accelerator based in China. Prior to that, I was the president and the COO of Baidu, which roughly can be considered as the Google of China. Before that, I served as the Executive Vice President of Microsoft in charge of its Applications and Services Group, which includes all of the company's software applications and services, such as Office and Office 365. Further before that, I worked at Yahoo for over 10 years, developing the bulk of its products and services. I have a PhD degree in computer science from Carnegie Mellon University. I'm thrilled to join the supervisory board of SAP because of our proud history, deep technologies, and a strong global customer base.
I'm excited about the opportunities of working together with you all, with our employees and shareholders together to unleash the much greater potentials ahead in digital transformation of all enterprises around the world. Thank you.
Dear shareholders, ladies and gentlemen. My name is Rouven Westphal, and I would like to introduce myself as a candidate for the seat on the SAP Supervisory Board that will be vacated when Pekka Ala-Pietilä resigns. As Pekka's original mandate runs until 2022, and the company's articles require that I cannot be appointed for a period beyond that point, today, I'm running for an initial period of only one year. In a way, this is a kind of extended probation period. My intentions are more long-term, but before that decision comes, you will have one year's time to get your own idea how I fulfill my mandate in the interest of SAP and what experience and skills I contribute to the work of the Supervisory Board. I have spent my entire career in the playing field of software companies, investment management, and entrepreneurship.
Starting my career at Andersen Consulting, later Accenture, I got to know the customer and partner side of the SAP ecosystem early on. That work familiarized me with the challenges of complex transformation projects, the development environment, and the software. As co-founder and CEO of Exasol AG, a tech company specializing in memory database systems, I can speak from experience. I know what it means and how long it can take to bring innovations into the market and make them commercially successful. That technology and its market are also the focus of SAP today. As investor, I have worked in the global financial markets for decades, especially in the technology segment in the private and public equity asset classes.
I have held several previous supervisory board mandates, so I can bring in relevant experience from supervisory board work at software vendors or professional service providers which are active in these markets. As member of the executive board of the Hasso Plattner Foundation, I represent one of the largest individual shareholders of SAP. I've known SAP and its management very well for many years. I am aware of the current challenges we are facing, but also of SAP's unique potential. As director of the foundation and head of the investment office, I'm responsible to ensure long-term funding of non-profit projects of the foundation. I have a special interest in the commercial success and economic well-being of SAP, reflected not least in a positive stock price development and a stable dividend policy.
Even though Hasso Plattner and I have known each other quite well and quite a long time through our work, I wish to stress that the foundation is completely independent from Hasso Plattner. I see my future role on the supervisory board as being an independent voice of the shareholders, and this is in line with Hasso Plattner's idea of a supervisory board member, because if you know him, you know that he doesn't like to surround himself with yes-men or order takers. He appreciates independent thinking and contradictory views if they are justified. You can and should expect that I will deliver both, and I would like to represent the investors' view on the supervisory board in as broad a form as possible.
I know many shareholders personally, and I know how crucial the protection growth of those asset positions is, not only for foundations and funds, but also for individuals. Therefore, I would be pleased to contribute my expertise and the perspective of a shareholder with a long-term strategy to the discussions and deliberations of the Supervisory Board, because I'm convinced that my position will also represent your interests as shareholders of this company well. For this, I'm asking for your trust and your votes. Thank you very much.
We hope that these videos and the candidate information we published on our homepage and in the invitation to this meeting have helped convey an initial personal impression of both nominees. A further topic on today's meeting agenda is the authorization to issue convertible and warrant bonds and the related creation of new contingent capital. Because the authorization for the existing facilities expired on May 11, 2021, it is now to be renewed. In addition, two amendments to SAP's articles of incorporation are to be put to the vote today. The first change is an expansion of SAP's corporate purpose, particularly in the field of telecommunications, in order to expressly cover SAP's business activities in the cloud. The second change is an update due to the rules for shareholders registration to the annual general meeting, specifically concerning proof of the shareholding.
This change became necessary upon the introduction of the Second EU Shareholder Rights . Ladies and gentlemen, before we start answering the questions by the shareholders, I would like to remind you once again of the different options for exercising your voting rights. As explained earlier, you can still submit or change your votes for the individual agenda items during the course of this meeting. To do so, you can use the password-protected shareholder portal and either appoint and instruct the proxies designated by the company, change your proxy appointments, or submit your votes electronically. Please note that we close the corresponding functions in the shareholder portal shortly after all the shareholders' questions have been answered. Ladies and gentlemen, let us now turn to the questions submitted by shareholders and shareholders' representatives. To that, I hand over to Christian Klein.
Thank you very much, Ms. Rotsch.
We will now turn to the questions of the shareholders for the company. We will start with the questions of the shareholder associations, then the investment companies will follow, and thereafter, we will answer the questions of the individual shareholders. Now, as we have received identical or almost identical questions on some topics, we will cluster them, and we will announce this when we read them out. The names of the shareholders who ask the question will be announced if they approved of this beforehand. I would like to answer now the questions of Ms. Benner-Heinacher of the shareholders association DSW. You do not tire emphasizing the alliances with hyperscalers such as Microsoft. What is the specific advantage of these alliances? What is different now than before? Please give us some examples. What are the specific impacts onto the figures and numbers of SAP? Answer.
We're using the cloud infrastructure of the hyperscalers in order to expand our own capacities in the cloud infrastructure area in a flexible and cost-efficient manner. Here we are open with our four plus one strategy as to which hyperscalers our customers go for. This is a competitive edge because thus we are better able to meet the demands of our customers while achieving cost benefits at the same time. Now, what's important for SAP is the success of SAP HANA, of our SAP Business Technology Platform and our applications. With our new offering, RISE with SAP, we bring all of these components and the infrastructure together into one single offering in a flexible manner. As we've already seen, this is well received by our customers.
Being infrastructure vendors of SAP, hyperscalers thus reduce our cost of capital and support our sales growth because they increase the geographic reach of our cloud solutions. With infrastructure services that we purchase at optimal cost, they also contribute to our profitability. Compared to last year, in this context, our collaboration with Microsoft turned from a sheer sales alliance to a much stronger development alliance. Many of our clients have already opted for Microsoft Azure as the cloud infrastructure service provider of choice. That is why we will further integrate our respective product portfolios, and here I especially would like to mention the seamless integration of the Microsoft Teams solutions into our applications. Here we're bringing the leading corporate communication solution together with the leading corporate software solution, and the advantages for our customers are unique. Next question.
After years of acquisitions, you are now in the process of better integrating the entire portfolio. In 2021, you announced to further push this. What is the current status of integration of Ariba, Fieldglass, SuccessFactors, and Concur? When do you think that this integration will be complete? Especially, takeovers took place in the past in the area of platforms. How well is SAP positioned on the whole? Are there any weaknesses left in the area of platforms? How do you want to overcome these weaknesses? By takeovers or alliances, such as the one with Microsoft Teams? Thomas Saueressig next to me is smiling. This means that we're making good progress in our integration efforts, which our customers have also confirmed. Integration has always been a key focus of our development work and will always remain so, because integrated companies, as I just mentioned, are intelligent companies.
Over the course of the last year, we supplied a seamlessly integrated intelligence suite, which includes the cloud solutions mentioned before, Ariba, Fieldglass, SuccessFactors, and Concur. In the next step now, this integration has to be further refined continuously with a clear focus on core topics such as the integration of non-SAP solutions for the openness of our solution, uniform data models between the applications, pre-integrated analytical functions, and standardized scalability. For all of this, our open SAP Business Technology Platform plays a central role. This is also an element which we continuously further develop. In that context, we always perform make-buy or partner analysis to decide whether we build things on our own, whether we purchase them, or whether we team up with partners. This applies not only to our platform, but to the entire portfolio.
We identify respective areas on the basis of our strategic priorities. As an example, let me give you the expansion of industry-specific cloud solutions or the expansion of our solutions in order to manage entire corporate networks. Collaboration with our partners will further develop and will focus even more strongly on development. The focus here will always be on a consistent solution architecture based upon the SAP Business Technology Platform. Now, regarding the following major topic, we have received questions from other shareholders in addition to those from Ms. Benner-Heinacher, and therefore, we cluster these answers. The next coup, or should I say, the next speedboat, is the spin-off of business with financial service providers that has been just announced, which you will contribute to a joint venture together with Dediq.
You are going to satisfy yourself with a share of only 20%, which is not really what I would consider a joint venture. How do you want to make sure that SAP has got sufficient influence? Which corporate governance structures are planned? Who's going to be the CEO of the new company? What is the volume and value contributed by SAP? SAP and Dediq will provide financial resources, technology, development know-how, and a comprehensive ecosystem to the new unit. SAP S/4HANA is the definite market leader for ERP solutions in the banking and insurance environment, and will also continue to sell and support solutions for enterprise information management and industry-specific solutions to customers of the financial services industry. SAP customers will remain SAP customers. The new unit will focus on core banking, such as commercial loan and retail client business, as well as on core insurance areas.
It will provide solutions to meet the new accounting requirements in the insurance and banking sector. The new solutions will be established as part of the SAP industry solutions in the cloud, and are based upon SAP technologies and applications such as SAP HANA, SAP S/4HANA, and our Business Technology Platform. The solutions of the joint venture will cover all processes of banks and insurance companies, and will help them to meet regulatory requirements. They are based upon integrated data and offer the possibility to move processes for financial service providers onto the Business Technology Platform in the cloud. Credit solutions for banks, for example, cover all phases from the extension of a credit to the credit risk review and up to refinancing and bank management. All of the related data are stored in a single place. This will significantly reduce IT costs and complexity.
We will manage this unit together. The unit will have the name SAP Fioneer. The SAP managers who are experienced in financial services will be on the board. Dirk Kruse is CEO, Reto Sager, and Marc Derungs as the head of product development. There was an additional question of the other shareholder. Is Dediq a sheer financial investor, or is there development know-how in the BFSI environment? Specifically, do the partners have proven experience in the software system integrator environment? Dediq is an entrepreneurial investor focusing on IT and digital companies. Dediq collaborates closely with its portfolio companies in order to create special products and services. Each Dediq investment is set up separately, independently, and with an unlimited time horizon. That's very important to us. We are pleased to enter into a strong partnership with Dediq, a partnership for the financial services industry.
Together with Dediq, we thus also enhance our system of alliances to financial partners. As an investor, Dediq also is experienced in financial services IT. Two of its portfolio companies are in the business of financial services IT. They employ between 500 and 1,000 employees, and together generate annual revenues of almost EUR 100 million. They do have a fairly good know-how of what customers need in these sectors in order to be successful. The plan is to transfer all FSI solutions and services and the third level and development support into the FSI unit. A project team, which will also include colleagues from the FSI teams, is currently working on transferring the solutions into the new business. This brings us to the next question. The European cloud Gaia-X is the dream of the Europeans to make the European standards the gold standard.
However, the U.S. CLOUD Act conflicts with data protection in the EU, and there's still no successful solution for the Privacy Shield. At first glance, the project looks attractive, isn't it too complex and too unspecific? Does this project have a prospect at all if American and Chinese partners are admitted as well? Wouldn't it be better to perform a couple of use cases first? Well, public reporting indeed does criticize that American and Chinese companies are also involved in Gaia-X. Being a standard-related organization, however, Gaia-X is obliged by antitrust law to establish objective criteria for a membership. We want to position the Gaia-X reference design as a global standard, and recognition and use outside of the EU is therefore specifically desirable. SAP has stated repeatedly that Gaia-X has to prove its added value in specific application scenarios.
One example is the Catena-X Automotive Network, which is considered the biggest industrial project based on Gaia-X. Gaia-X is to be established as a reference design for trustworthy data networks and cloud architectures. Thus, the requirements of regulated industries such as the health sector or aerospace and the public sector will be modeled there. Next question. Together with other companies, you have established the Automotive Alliance as a so-called new European standard platform for the automotive industry, and you're selling this as the industry cloud for this industry. Are there other key industries where similar models could be developed? What is the current status of the Automotive Alliance? Are there already visible results? The Catena-X Automotive Network, the former Automotive Alliance, is to provide a uniform standard for the safe exchange of data information between automotive OEMs and suppliers along the entire value chain.
Together with BMW, Mercedes-Benz, Volkswagen, Telekom, Bosch, Siemens, ZF Friedrichshafen, and many other partners, we're currently working on the creation of an open, scalable network based on the European Cloud data infrastructure, Gaia-X. Basically, the cloud-based network is open to all members and participants of the European automotive value chain. This open approach allows a joint value creation of all participants, and it supports application scenarios, for example, in the area of sustainability. Using fully connected data flows, companies will also be able to measure, analyze, and manage their ecological footprint. Now, this is an approach which is highly relevant for many industries. Of course, further industrial networks would be conceivable, such as in the public sector or in industries such as aerospace, health, and energy.
Now, before the end of this year, we intend to ship first applications in the areas of traceability, sustainability, circular economy, and quality.
Yeah, [Foreign language]
With that, I now would like to hand over to our CFO, Luka.
Thank you very much, Christian. The next question by Ms. Benner-Heinacher is as follows: Mr Mucic likes to use the image of the tanker and many speedboats. Thanks for citing me as your source. At the beginning of this year, you launched the first one with the IPO of Qualtrics. The purchase price, the initial one was $8 billion, market capitalization at the IPO, $23 billion. SAP is currently holding 84%. You say that you want to retain majority in the long run, but 51% would also be sufficient. Does this mean that in 2021, you will sell further shares at attractive prices?
Well, let me first of all tell you that the so-called fully diluted share, which is the share held by SAP, if we take the outstanding Qualtrics employee options into account, now this fully diluted share is at 75%. We do not have a specific time schedule yet. Nevertheless, we intend to increase the capitalization of Qualtrics with a follow-on offering to allow them to continue to pursue their growth strategy, potentially also by growing inorganically. SAP provided Qualtrics with a capital of $500 million at the time of the IPO. Over time, we want to provide an amount of $1 billion of capital to the company. Beyond that, our medium-term plan with Qualtrics does not include a significant change of the current equity share. Against the background of the great potential growth of Qualtrics, we want to participate in potential value increases.
Next question by Ms. Benner-Heinacher is as follows. Media have reported that Zalando recently introduced SAP S/4HANA. There seems to be great skepticism whether about 35,000 existing customers will really migrate, and when migration to SAP S/4HANA and then into the cloud will take place. There are some first positive signals, such as the increase of the KPI current cloud backlog, but can you confirm this trend? Yes, we definitely can. Christian Klein already touched upon it in his presentation. Especially with the current crisis, digitalization has moved higher and higher on the list of priorities of basically all companies in all industries. For this reason, towards the end of last year, and especially in the first quarter, we have seen a very strong willingness to invest again.
With our new offering, RISE with SAP, we feel that we are just in the middle of the trend, which the market is asking for, namely holistic business transformation as a service. Please remember that we launched this offering only two months ago, but since then, we've already been able to conclude more than 100 contracts with clients. Demand is still really outstanding. Pipeline keeps growing and growing. That's why we feel that we're on the right track. In the future, we want, of course, to provide transparency on our progress. For that reason, as of the first quarter, we will also always report and disclose our current cloud backlog and the S/4HANA revenues.
All in all, as I said, we are very confident that we will be able to support our customers in an optimum manner into the cloud, producing respective growth also for SAP. Next question. Your forecast for cloud growth so far was between EUR 9.1 billion and EUR 9.5 billion. Cloud revenues are expected to increase by EUR 100 million, and the guidance is to be between EUR 9.2 billion and EUR 9.5 billion. Cloud and software revenues were at EUR 23.3 billion- EUR 23.8 billion before the adjustment.
You have now raised the lower value to EUR 23.4 billion. This already sounds a bit more positive than previously, and the gratifying effect was the share price increased almost towards EUR 120. What is the outlook for an SAP investor with a medium and long-term horizon? How much longer do we have to be patient until we see share prices again, as in last September?
I think what matters now is proof that the strategy change and the transition into the cloud really does work. We are thus building upon a long-term and sustainable business model. Existing customers are very much interested in the RISE with SAP offering, which gives us great confidence in the first place. The business results in the fourth quarter 2020, and also in the first quarter 2021, have demonstrated that customers are increasing their investment volumes again in order to get prepared for the future. That's what we have seen, for example, in our order intake numbers in the cloud in the first quarter. In addition to the strong cloud new business in the last two quarters, however, this trend also manifests itself in the growing cloud pipeline. RISE with SAP is the definite driver, but not the only one.
The rest of our cloud portfolio also had an excellent start into this year, which gives us great confidence that we will also be able to advance our overall portfolio excellently. We also see a positive trend in market share development. In the first months of this year, we were able to position ourselves significantly better in many areas versus our competitors, and thus win new customers for the SAP solutions. We believe that we will thus tap the full potential of SAP in the next couple of years. That's why I'm quite confident that the high share prices reached so far will not be the end of the story yet. Next question is about the goodwill of Concur. According to the annual report, the goodwill of Concur amounts to EUR 3.3 billion.
According to the sensitivity analysis, you are planning a negative revenue growth of -4.1% for this segment. The target of the operating margin is to be -26% at the end of the planning horizon. What is the actual planning horizon that you applied? Which assumptions did you apply in your plans for Concur for 2021? What is the headroom, and do you expect extraordinary write-downs on the goodwill? Well, the last is the most important question, therefore, let me take this one first. No, we do not expect that. For the goodwill impairment test 2020, a planning horizon of nine years was applied for Concur, and the headroom amounted to a quite comfortable EUR 11.5 billion. For further information, please see the D2 annex of the consolidated notes.
The planning for 2021 reflects our assessment for the expected development of business, taking numerous aspects into account, such as the ongoing impact of the lockdown and the availability and effectiveness of vaccines onto the volume of business traveling in 2021. Let me once again emphasize very clearly, Concur has stabilized on a low level compared to the previous years, but for the remaining part of this year, we do not expect a strong recovery yet. Regarding the overall business development of Concur, I also would like to refer to our statements in the quarterly release for the first quarter 2021. In the beginning of the year 2021, we still saw a somewhat sluggish business development at Concur. Looking ahead, we expect the Concur business to recover significantly together with market share increases of Concur in their relevant market.
At this point, let me also emphasize that as part of our focusing and restructuring, the Concur segment in the beginning of this year was basically transferred to the Applications, Technology, and Support segment. The entire goodwill previously allocated to Concur is now monitored comprehensively within the new segment structure. That marks the end of my questions so far, and I hand back to Friederike again.
Thank you very much. Another question comes from Ms. Benner-Heinacher. Despite criticism from investors and agreement or approval, in 2020 of only 78%, why has SAP not improved the remuneration system and submitted this for approval? Additional cost of EUR 23 million were caused by decisions and changes on the Executive Board, which is why we withhold approval of the acts of the Supervisory Board, and this does not include the LTI payments. How high will the payments be for the Executive Board members who left in 2020? We are also getting a lot of feedback on the structure on the Executive Board remuneration. Pay system should be sustainable, and after revising it in 2019 and 2020, we decided that we would not change the remuneration system again, because the majority of shareholders approved. We're aware that a minority is critical of this.
This is something we looked into after the AGM last year, but we cannot follow all points of criticisms always because in some cases, we have contradictory demands from investors. Of course, we haven't been sitting on our hands. Based on investor feedback, we have further increased the level of transparency in the compensation report. Starting with the SAP integrated report for 2020, we now publish 100% target amounts for the short-term incentive program. Further, we have discussed the feedback to the compensation system in the context of our unique position as a European company operating in a U.S.-centered industry. While we have not yet decided on further changes, we feel it important that we continue to discuss and evaluate the feedback from the investor community.
The LTI tranches for Jennifer Morgan is approximately EUR 8.3 million, for Michael Kleinemeier, about EUR 8 million, and Stefan Ries, approximately EUR 5.8 million. The values are based on the distribution amount and depend on the development of the stock price and the development of the performance criteria. For the next question from DSW, I'll hand over to Thomas.
Thank you, Friederike. Next question is, we heard that last year SAP started the Climate 21 initiative, which is supposed to enable companies to collect climate-relevant data. Against the background of a public discussion and upcoming regulation, for example, on the EU Sustainable Finance, it seems that you had the right instincts. Could you explain how far this initiative goes and what hopes you have there and what you expect in terms of revenue potential and what competition do you expect?
Well, that was a very forward-looking activity because as part of the Climate 21 initiative, the SAP Product Carbon Footprint Analytics was delivered early. We should add here that SAP has been addressing sustainability for a long time in its portfolio, including diversity and inclusion in HR software. With SAP Product Footprint Management, we go one step further. From August, we'll offer our customers the opportunity to register and analyze the carbon footprint of products across the whole value chain. In addition to products to support climate protection, we're also developing more sustainability products. This includes products which support circular economy or holistic company management. We want sustainability to be another dimension in transactional and analytical applications, and our strategy is trailblazing and pioneering for the whole industry.
We expect a very positive contribution from our Climate 21 initiative for our business development, and it will make our whole portfolio more attractive and sustainable. Many of our customers want to invest more into sustainability, and with our solutions, we are giving the transparency to make better long-term decisions and to reach sustainability goals. Since the market for sustainability solutions is still very new and there is no single vendor that has established itself, we see a huge market growth potential and very clear competitive advantages because we are ideally positioned because we have seamless integration with our products and the business processes of our customers. The next number of question comes from the SDK, and for that, I will hand back to Christian Klein.
Yes, thank you very much, Thomas. Marcus Kienle submitted the questions on behalf of SDK.
In 2020, in the middle of a pandemic, you made adjustments to the corporate strategy. Why did this make sense or why was it necessary to change things at that point in time? What major adjustments were made and what financial impact do they have? Well, as a result of the COVID-19 situation, many companies decided to speed up their transition to the cloud. Last year showed clearly there is no alternative to the digital transformation. Companies with digitalized business processes have a significant competitive advantage. It's the only way to become more resilient and flexible. The demand for cloud solutions has increased accordingly. This is why we adjusted our strategy consistently to support the accelerated shift to the cloud and the resulting business transformation of our customers. Second question. The core elements of the strategy adjustment we carried out are, firstly, we bring our customers into the cloud faster.
Our new offering, RISE with SAP, which we introduced in January, plays an essential role here. Secondly, we focus more on organic development of the company. We kept our promise of better corporate integration. At the same time, we are accelerating our speed of innovation and stepping up our development funding in a balanced, measured way. The clear increase in customer satisfaction shows that our customers appreciate this. Thirdly, we are improving our cloud infrastructure even further. To make the operation of our cloud more cost efficient, we are replacing faster than before the heterogeneous infrastructures of our acquisitions with a homogeneous modern infrastructure. We will also migrate our existing customers to that new infrastructure. All adjustments have an investment character. Because we are bringing our business into the cloud faster, corporate profits will be moved into the future.
The reason for this is that we are converting the classic business model of selling licenses to the subscription model, the typical cloud model. In the long term, this model produces higher recurring revenue. However, in the transition phase, total revenue growth and bottom line are impacted. The financial impact is fully factored into our financial ambition for 2025, which we published last fall. With that, I'll hand over to Luka again.
Thank you, Christian. Now I need to take a deep breath for a whole number of questions. The first one was also asked by Mr. Schmidt of DWS and Mr. Gabler in a similar form anyway. We will answer them together with one from Mr. Kienle. The figures for the last business year show that you got through the corona pandemic well and that you can continue implementing your strategy.
The first quarter 2021 delivered robust figures, which speaks for the good position of SAP. In which areas did you have the biggest impact due to the pandemic, and do you expect further impact to come in the year 2021? Well, the biggest effect of the pandemic was probably in our Concur business, which is, of course, travel cost management software. Due to the lockdown in nearly all countries all over the world, this business went down, and that had a significant negative impact on the Concur business. We also believe that for the rest of the year 2021, the development will be very moderate at Concur. In 2022, we expect more increases and more contribution to the cloud by Concur. Apart from that, we are proud that despite the challenging conditions during the pandemic, we were able to serve our customers effectively.
For example, by virtual sales and also implementations, which is something that was very successful. Many go lives in 2020 across our whole portfolio. The global uncertainty leads to an impact. We have been very disciplined in spending and hiring. Although we did not save too much so as to endanger our position, in fact, we invested. We used opportunities, for example, saving costs by traveling less or by having less cost for office buildings or office space. Despite the difficult market environment, we have been able to increase operating profit, non-IFRS at constant currency, and also of the operating margin. Overall, we're expecting a long-term digitalization push as a result of the pandemic and a move into the cloud. That will be positive for our strategy. The next question, the gross margin rose. What is your target gross margin?
Well, this is one of our pet subjects. Here we're investing in 2021 and 2022, and this is something that we heard in the CEO's speech. This investment, a mid-three digit million amount, will result in the next three years to increase the cloud gross margin, but it will still have a homeopathic effect. Starting from 2023, that increase will soar. This is what we expect because we will have a very elastic and harmonized cloud infrastructure at that time, and that will be the basis for very good scalability. In 2025, our cloud gross margin is expected to be at about 80%. Next question. Cloud revenue 2021, you're assuming growth of 17%, but in 2025, you want to be at a figure higher than EUR 22 billion.
If you assume a growth of 17% up to the year 2025, you arrive at cloud revenues of about EUR 18 billion in 2025. How are you going to achieve your target in 2025? It's important to understand here that the revenue in the cloud business is a subordinate indicator, and the growth in 2021, we're seeing in 2021 is basically a product of a slightly weaker order intake due to the pandemic in 2021. Conversely, that mechanism means that the very strong order intake in the second quarter or in the first quarter, and which we also expect in the coming quarters, will accelerate the revenue growth. This is driven, of course, through our RISE with SAP program, which took off in January and has become a pipeline increasing factors and has already contributed.
Also due to new innovations, industry networks, industry solutions, business networks, also our business process intelligence business that we're building up is going to contribute, and of course, a continuing robust growth of our software as a service portfolio. We're expecting, based on that strong new business in the first quarter, actually, starting with the second quarter, stronger cloud revenue. We are not afraid that we will not achieve the EUR 22 billion. The next one from Mr. Kienle. The same question applies to the development of the operating profit in the period up to 2025, because in 2021, you are even expecting a decline. This is true, as we reported in Q3 last year, our outlook for 2021 and our midterm ambition is comprised of several factors, influential factors, and the important one is the accelerated change to a different business model, the cloud model.
That accelerated change results in several things. For one thing, revenue that used to be realized immediately will be shifted into the future, and this will have a slightly lower gross margin, although that will go up in the coming years. In addition to that, the investment over the next two years into our cloud infrastructure, we mentioned this, and also further innovation-oriented investments into our development portfolio and our organization. All that results in a situation in the next two years where we'll have operating profit with a flat or slightly negative increase rate. After that, starting in 2023, when the cloud is the dominant business model or has become the dominant business model with a rising share and higher profitability, we expect our operating profit to be in the two-digit range and also highly upscaling growth.
The next question for the years 2022 and 2025, you stated planned sales revenues, but not for 2021. Why is this information missing on sales revenues in 2021? The answer is easy. As part of the annual forecast, SAP is always focused on cloud and software revenue because these are the strategic revenue components, and other revenue sources like service are a consequence of this. This is why this is the main factor for the strategic value creation. We have published midterm ambitions. For example, in the past, for the year 2020, or also as part of our midterm ambition up to the year 2025, we state overall sales targets. This is because we're looking ahead into the future quite far, and the exact composition of the individual sources of revenue or the revenues are more difficult to predict than doing this on an overall yearly basis.
In the years where such midterm ambition was published, we gave a total sales figure, too. In 2021, this was the case based on the 2015 ambition, and it was to be true for the 2025 ambition. Between that, we focus on the cloud and software revenue from the sources.
The next question. You sold the communication unit SDI, at the same time, you want to focus your activities with communication products. How do these opposite ways of behavior fit? The second question here, why did you sell SDI in the first place, what kind of return on investment did you achieve? Well, first of all, we don't deem this as opposite ways of behavior. When we sold SDI to the Swedish Sinch AB, it was the result of a continuous monitoring of our product portfolio, which we do regularly. That was a messaging platform, a texting platform. That's a core telecommunications business, and that's not the core of our business model. Due to the investment required in this field, we came to the conclusion that it's better to sell it to a specialized provider that would provide a better harbor for SDI.
Independent of that, you have to see that the proposed changes in the articles of incorporation, because in the context of our core activity or core business strategy, that is providing cloud services, there are installed functionalities in the cloud products by way of nature, so to speak, the nature of the cloud, that involve telecommunication aspects, and that is to be covered in the modifications proposed. As regards the second part, why did we sell SDI? Well, just the reasons I have mentioned. It is not part of our core business model, and with that, we have identified a better home with a specialized provider, who, by the way, offered a fair price for us. EUR 225 million had been agreed on. That led to a positive net effect of EUR 194 IFRS and EUR 128 million non-IFRS, which you find under other operating expenses as a net.
The return on capital employed cannot be identified in an isolated fashion because the SDI business was interconnected with several business units of Sybase from whom we purchased, as well as SAP. Accordingly, there were no standalone assessment here. Mr. Kienle had several questions regarding the IPO of Qualtrics. For Qualtrics in 2019, you paid roughly EUR 5 billion, which is with the 78% of the purchasing price. In 2021, you've done a part IPO. Why did you take it public to fully use the potential? There were several reasons for that. On the one hand, it results in a greater level of independence, and as a result, Qualtrics can be active within SAP customer base, but also outside of the SAP customer base.
The IPO enabled Qualtrics to be closer to the customer to develop their own acquisition strategy, and also to attract the qualified staff required for the tremendous growth by offering interesting stock option plans. Is the IPO of Qualtrics in line with the adaptation of the corporate strategy? No, the decision was taken prior to the adaptation of the strategy. What was the stock value of Qualtrics? Well, based on the issuing price per share, Qualtrics achieved $18 billion. That's 100% increase. That refers to the next topic, too. What's the return on the share you've brought to the stock exchange? What do you expect in terms of return on investment? Once again, return of investments of individual acquisition projects are not published. However, KPIs such as the return on investment are integrated part of our assessment criteria for acquisitions.
Rest assured, we only acquire companies that will guarantee an increase in value for SAP. The next question, have you already identified reinvestment options for the inflow recorded? First of all, due to the IPO, SAP has received EUR 1.8 billion. We're not seeing this separately and will use it for one specific purpose. It's part of our general cash flow from financing activities and will thus be used for the same general purposes as the other remaining cash flow. We have a clear list of priorities. First of all, organic investment, then reduction of financial liabilities, payment of the regular dividend, which once again has been increased this year, then the funding of acquisitions, and if they make sense here, and if a cash overhang remains after all these priorities have been covered, a further disbursement to our investors.
Mr. Kienle, you asked about the acquisition of Emarsys at the end of last year. You asked about the purchasing price. Well, we paid EUR 600 million. The second question was revenue and earnings of that company over the past three years, starting in 2020. Whereas for 2020, you expect that in 2020 there was no full consolidation. Well, all I can say here is that revenue and earnings of the company are seen as not material for SAP. I therefore ask for your understanding that we can't publish more detailed figures here. Also you asked about the return on investment. Well, same answer here. We don't publish individual return investment for individual acquisitions. However, we make sure that there will be a positive ROI. That's part of our business plan. We only acquire companies that result in an increase in value.
The turnover Concur, that depends on global traveling, which has drastically been reduced due to the COVID-19 pandemic. Do you expect a recovery of the travel business to the pre-crisis level? What is the future development of Concur? Well, as regards the first question, not in the short run. It'll take some time, but we expect that as of the next year, Concur will find a better business environment. We can see that we offer the strongest solution in the market, and we expect further strong market potential, and that will make use of that and gain additional market share. That will have a positive contribution as of next year from Concur. That's also the long-term development we expect. I see no reasons whatsoever why Concur shouldn't be as successful as all the other solutions we have. Another question related to the day sales outstanding.
That increased from 71 to 78 days. Was the pandemic the reason for that, and what are the long-term or sustainable DSO you are aiming for? Well, the pandemic, of course, is one reason, but furthermore, this increase is due to the method we apply to determine the DSO. We arrive at the DSO number by dividing the average volume of invoice receivables of the last 12 months by the average payments received in the last 12 months. Thanks to an improved working capital management, a great success in 2020. We've reduced it considerably below the 2019 number, and as a result, at the end of 2020, we had this increase in the DSO. As you have seen in our first quarter results, we no longer report the DSO KPI externally anymore because we focus more on cash flow.
That is why we focus more on cash flow also for controlling purposes. Now, the equity ratio, 51%. With that, you are sure to be one of the companies with the strongest equity ratio. What is the appropriate equity ratio, and as of when do you want to achieve it? Well, in a nutshell, with our current equity ratio, we feel well-positioned to comply with all the obligations we have versus customers, employees, and investors. The actual development of the ratio depends on diverse factors such as the economy, the payout of dividends, the development of profit, share buybacks, exchange rates. We don't have a specific target figure for equity ratio, but we also observe the development closely to take immediate action, and the current ratio has been constant over the past years, and we aim to maintain it.
The next question, for the past fiscal year, you have a return on equity of more than 17%. That's an increase of more than 7 percentage points. What is the long-term equity ratio you want to achieve in the long run? You might expect the IFRS return on equity is not a central key performance indicator. On the one hand, the past years are good example, there are one-off effects that lead to substantial fluctuations. On the other hand, it's also depending on the capital structural policy. A higher return expectations will lead to higher fluctuations and volatility, which not necessarily will increase the value, and that is why we still focus on our operative or post-tax results and the cash flows linked to that. A question as regards to sustainability. You've been able to reduce greenhouse gas emissions and energy consumption considerably.
What share of that reduction is due to the corona restrictions? Yes, in 2020, our gross greenhouse gas emissions have been reduced considerably, mainly, of course, due to the impact of the COVID-19 pandemic. You can see that the gross greenhouse gas emissions went down from 794 kt in 2019 to 410 kt CO2 in 2020. This equals a reduction of 48.3% against 2019. That's over proportional. Then, of course, the travel reductions here played a major role. The energy consumptions decreased from 955 GWh in 2019 to 693 GWh . This is a limited reduction of 27.4%, small compared to the reduction of the CO2 emissions. The last answer, because I can catch my breath.
In the fight against bribery, you have received whistleblower information against possible infringements of the anti-bribery law in the U.S., which the Office of Ethics of SAP and an external law firm investigate. What kind of actions have allegedly infringed on the anti-bribery acts? Well, SAP has received hints regarding possible infringements linked to sales partners. SAP has thus involved an external law firm to investigate these hints, and all business transactions with the partners came to a halt and additional compliance controls were established. SAP is working on the complete investigation and fully cooperates with the responsible authorities. Ethical business behavior and the keeping of laws and regulation is a major pillar of all our actions throughout the world. For legal reasons, we can't give you further details until the current investigations come to a close.
This takes us to the end of Mr. Kienle' s questions and continue with Mr. Buhlmann's questions. Back to Christian Klein.
Yes, I'm happy to give you some break now. First question. Early April, we could read in the news that Google mother Alphabet has replaced the software Oracle by SAP solution. Is that true, and what's the reason behind it? Does it mean that you've won this by huge discounts and that it was a loss-making transaction? No, actually, with Google, we are combined in a long-term successful partnership. Since that the Alphabet Group now switches its finance system to our products wasn't unexpected for us. This decision had been taken some years ago. The migration of the system to SAP S/4HANA went according to plan. The reason for the report was internal Google communication.
It was about process changes in the FI-AR, which were triggered by the migration, and Google employees published information about this. The contract with Alphabet was a standard terms. It was mainly the quality of SAP products, which led to the decision in our favor, because Alphabet wants to grow as well, and all that together, the quality and the value added of our solutions, led to this decision in our favor. Now, next question. Globalization has now come under criticism in view of the crisis. We see trends towards de-globalization. Would you be able to break down these data structures to smaller units? How strongly is the business of SAP impacted by the interference in the free trade? The same topic in Russia, you see trends towards more independence. Have you felt this, and has it had implications on your business?
Well, in fact, some countries are erecting digital borders again, and this may indeed endanger what we've achieved throughout globalization. In larger markets, SAP works with hyperscalers such as Microsoft Azure, Amazon Web Services, and Google Cloud Platform, and has local computing centers. In smaller markets, it's often a matter of economic considerations, and countries who don't follow the international cloud might be precluded and excluded from technical expectations. We see that highly volatile market environments often result in an acceleration of digital transformations and in customers investing more funds into cloud solutions like supply chain management to allow them to react more flexibly. SAP is one of the leading suppliers here. Also when it comes to the trend of de-globalization, SAP benefits.
On your second question, the political situation in Russia is impacting the economic development, and that, in turn, is having an effect on our business. As a result of this, the performance of our business unit in Russia was slightly weaker compared with previous years. Over to you, Friederike.
Well, Mr. Buhlmann also asked questions about the compensation and the composition of the Supervisory Board. Shortly after the publication of your annual report, the trade paper Handelsblatt wrote, "SAP pays severance pay of more than EUR 23 million to former board members. The board reshuffle incurred high costs for the DAX company," and I wonder which part of that sum is truly earned. What about the remaining sum? Is the Supervisory Board liable for damages to your company? Well, the Supervisory Board is bound by the contracts agreed with the Executive Board members.
These contracts all lay down that in case of premature termination caused by the company, the member of the Executive Board receives severance pay. The payment consists of different components based on the German Corporate Governance Code. The level of severance pay is derived from outstanding base salary plus target STIs for the remaining term of the contract. It is our objective to keep members of the Executive Board for the term of their contract. However, for various reasons, changes to the board might be necessary. We're confident that after several changes in the past years, things will quiet down now. We deem the current composition of the Executive Board as well-suited to face the present challenges and, beyond that, to ensure also the long-term success for SAP.
Regarding the compensation system adopted last year, I would like to know why uncapped opening clauses are applied with or without cause, why target adjustments throughout the year reverse the results, and why even agreed caps and hurdles can be ignored. Does the Supervisory Board act like a medieval landlord, ignoring the shareholders' vote on the compensation system? Mr. Buhlmann, that is not the case. The compensation system adopted by the AGMs in 2020 is the basis of all compensation decisions of the Supervisory Board. That also applies to the variable bonus systems that were taken by the Supervisory Board. No targets were adjusted throughout the year, nor any caps or hurdles ignored. There was no payout of STIs as targets and hurdles established beforehand were not achieved as a result of the COVID-19 crisis.
The decision of the supervisory board to pay a bonus by way of exception to the executive board members active in 2020 are in line with the compensation system. This additional bonus honors their tremendous activity by this unprecedented pandemic and economic crisis. The compensation as such allows for that. The supervisory board looked at this in great detail and took the decision because the members of the executive board have ensured in these extraordinary times that the company remains profitable, stays well on course, that focuses on long-term success. For that, I'd like to express our thanks to the executive board.
There's a question on the composition of the supervisory board. Mr. Buhlmann says, "The agenda item on the by-election for the supervisory board includes the election proposal for Dr. Qi Lu, who's got Chinese and American origins. We appreciate diversity and cultural diversity very much and consider it a very strong asset. Our respect for Asian business partners maybe should also cause us not only to use German and English on our homepage. In other words, cultural diversity should not be a one-way street, but it should be a healthy and confident two-way street. Will you address the concerns voiced in the Western world regarding the social situation and the human rights in China through Dr. Lu?" Mr. Buhlmann, we agree with you that cultural diversity is a very valuable asset.
For that reason, the topic of diversity also plays a very strong role at SAP. For that purpose, we also set ourselves ambitious targets on all levels of the company. Of course, we also address our customers on the websites of the SAP companies, not only in English but also in their respective national language. The election of Mr. Qi Lu is to increase this diversity of various perspectives through his comprehensive technological experience in the U.S. American and Chinese software industry, thus increasing diversity and know-how in our supervisory board, and thus also giving us important impulses for the further success of business development, especially in the very important Chinese market. SAP has always promoted the protection of human rights.
In the public, the executive board, which is the body that is responsible for operating business, is also responsible for representing the attitude of the company and to address those issues which are relevant from our point of view. The executive boards did so, for example, after the Black Lives Matter protests in the U.S. There are questions on SAP Cloud, which will be answered by Thomas Saueressig.
Another question by Mr. Buhlmann is, why are Europeans so poor cloud performers? Does Europe have a chance against America at all? How high would, in your view, be the monetary entry barrier for a European cloud in order to catch up with the American vendors? I think here we've got to differentiate the cloud categories. Infrastructure as a service, platform as a service, and software as a service.
Amongst the vendors of a pure cloud infrastructure, which is infrastructure as a service in the traditional sense, well, here your mass American providers such as Amazon, Microsoft, and Google are really leading. Every year they invest massively to maintain and enhance their capacities and have reached significant economies of scale. For us, however, it is even all the more important to be infrastructure agnostic in the field of cloud platforms, that is platforms as a service. We want to be independent from the infrastructure because this gives our customers the flexibility that they need. That's very important for us because we want to support our clients to push the business transformation in their business, because that's not going to take place in the infrastructure area alone. This also means that it's not only necessary to transform the IT landscape, but also the IT processes.
Here, our SAP Business Technology Platform is the important basis to facilitate innovation in business processes. Amongst the vendors of cloud-based applications, that is software as a service, there is a continuously increasing number of very successful European vendors. Of course, there's no doubt SAP is in the leading position here. Against the background of the European Cloud Initiative Gaia-X, it is to be noted positively that industry specific alliances such as Catena-X in the automotive industry can represent a counterweight to the U.S. American dominance. Here, SAP is collaborating very closely with partners in the industry to develop solutions for an industry cloud in the various industries. This, of course, has to be seen in the European context. In both initiatives, Gaia-X and Catena-X, SAP has been one of the founding members. Another question by Mr. Buhlmann relates to quantum technology.
The question is as follows. Recently, we read a lot about quantum technology, this is a business which is dominated by American companies. What scares me is the outlook of conventional security systems being outwitted, artificial intelligence is also to become much more powerful with quantum technology. How does SAP view the situation, especially the situation of security? Is that a threat for your customers and applications? Does quantum technology play a role for SAP, especially in the cloud? Yes, SAP is doing active research in quantum technology and is collaborating very closely with industrial partners, universities, and research institutes. Thus, we want to be prepared for any changes in good time and build up our in-house know-how at the same time. The quantum technology is still in its infancy, it does not offer any specific use case and no scalability yet.
However, it is highly probable that quantum technology can influence our business in a medium to long run. We see opportunities in all areas where there's room for optimization, for example, in route planning and logistics. On the other hand, however, conventional data encryption is a risk because it can be decrypted by a powerful quantum computer. For that reason, today, we are already doing research into possibilities that will make our solutions safe in the so-called post RSA encryption world. After the technical questions, Mr. Buhlmann has got some questions on the financial results, which will be answered by Mr. Mucic.
Well, thanks, Thomas. The next question goes back to my hobby horse, namely the cloud gross margin. Mr. Buhlmann says that without currency effects, it was at an impressive 69.3% last year.
Can you explain to us how the individual cloud segments performed and explain the large gap between the gross margin and the operating margin? Considering this level of profitability, does it make sense to discontinue or divest less profitable business units? Your segment-based reporting makes it difficult for outsiders to determine which actions actually produce specific effects. Can you improve on this? On the one hand, indeed, the cloud gross margin developed positively in 2020. Without currency effects, it was at 69.6%. What is most gratifying is that all cloud business models contributed to this growth. Software as a Service and Platform as a Service margin increased by two percentage points to 71%. The Infrastructure as a Service margin increased by five percentage points to 34%, and the Intelligent Spend margin by one percentage point to 79%.
By the way, this is also reported very transparently in our segment reporting. Although our operating margin also increased year-over-year, I would recommend not directly comparing it to the cloud gross margin. On the one hand, the operating margin also includes the margin of our entire services business, which is at 27%, which is an absolutely leading performance in the services business. Due to the nature of the business model, it's not on the same level. On the other hand, it also includes the expenditures of many support functions, such as research and development units, where we're investing massively, as we touched upon before. All the sales and marketing costs and the general sales and administrative costs, which are also important for the future and the growth of this company, but which do not manifest themselves in the gross margin.
Nevertheless, and we had the example of the SDI. Nevertheless, the executive board at regular intervals reviews its portfolio activities to determine whether they are still strategically relevant for the strategic focus of SAP. If that is not the case, and if at the same time, they do not meet the financial expectations of SAP regarding the overall profitability of the company, of course, we also openly discuss the question of whether the long-term future of such a business might be better served outside of the company. We took that decision with SDI and in the year before, if you remember that, for our business in the regulatory content environment, we will continue applying this approach. Our current portfolio, let me emphasize this, is a portfolio which we consider to be strategically relevant also in a sustainable manner. The question about business segments.
Well, here we provide all of the data which we are obliged to disclose according to IFRS 8. Beyond that, we also disclose further data, for example, about the sale of our communications unit, SDI, or about the takeover of Signavio. We disclose this information in our quarterly reports if they have a respective impact onto our segment structure. We do believe that thus we also provide relevant information to the capital market. Next question. Could you explain a bit more precisely what the microscopic amendment of the articles of incorporation actually signifies in item number 8? Well, microscopic is the right adjective, Mr. Buhlmann. Actually, it's about two fairly simple things.
On the one hand, the corporate purpose is to be amended to include the area of telecommunications, not because all of a sudden we wanted to become a telecommunications company to compete with Vodafone or Deutsche Telekom in their core business, but rather because operation of cloud solutions also makes it necessary for customers to access the internet, and therefore the solutions have to include telecommunications solutions. That is, of course, something we also want to demonstrate in our corporate purpose. On the other hand, on this occasion, we also want to linguistically modernize the description of the purpose of the company using the currently applicable terms. Mr. Buhlmann went on. He said, "We noted positively that you now are strongly committed to integrating the takeovers. The successful spin-off of units and the quick growing together of units creates added value and also cost savings.
Do you have a clear plan for both of these dimensions, a measurable volume, and how will you report on this today and in the future? Well, my question is similar to the one related to the business segments. According to the IFRS standards, certain disclosures are mandatory. These are included in SAP's consolidated notes on material actions. For example, we provide qualitative statements on the synergistic effects, which we expect from respective takeovers, and furthermore, the revenue and profit contributions of the companies in the year of the takeover, as well as certain pro forma data, are disclosed. Furthermore, we also disclose data on how the goodwill of the company is distributed onto the respective segments, including the expected synergies. SAP is also going to meet the disclosure duties based on the IFRS standards in the future.
However, at present, they do not require any specific quantitative statements on sales and cost synergies. Another question regarding the share price slump last October, which caught everybody by surprise, and Mr. Buhlmann says, "I would consider this an information disaster. Is SAP today less valuable than in September 2020? Why didn't you explain this better beforehand, and when do you want to recover this drop in share price?" First of all, let us clearly emphasize that we know and we are aware of the fact that 2020 was a turning point for SAP in various regards, and this also applies to our strategic focus. However, in the context of the COVID-19 crisis, we clearly realized that a fundamental transformation of the demand preferences of our customers has taken place, also in our core business, ERP.
The pandemic has also brought about a massive acceleration of the willingness of our customers to transform into the cloud. This is something we had to respond to actively, and that's why we acted quickly, and we developed a strategy until fall, which we then also, of course, attached respective financial targets to. That was then also submitted to the supervisory board, and then the respective consequences were taken. We mentioned this before, the shift from an upfront business model to a prorata-based business model with the respective consequences onto profitability. Of course, we are aware of the fact that this was surprising news for the capital market. However, you also have to bear in mind that the way how we communicate strategy changes is also subject to certain regulatory requirements.
In this case, we were obliged to immediately provide this information to the capital markets by an ad hoc message as soon as the respective decisions had been taken by the executive board and the supervisory board. However, I've had various meetings and discussions with investors after that news had been made available to the general public. The feedback from all of these investors was that this strategy is viewed as being the right one and a value-enhancing one in the long run. We now have to just make sure that we also implement it properly, and the results of the first quarter have also been appreciated positively by the market observers. This has now also started in manifesting itself in a recovery of the share price.
Last but not least, Mr. Buhlmann says, "In the context of the Qualtrics IPO," this is a question which was also asked by Mr. Hendrik Schmidt from DWS and by Mr. Ingo Speich from Deka. For that reason, I would like to answer these questions together. In January, you had a successful IPO of Qualtrics. Was this just a test to deal with other parts of the company in a similar manner? Well, it would at least be a good solution to better protect the goodwill in the balance sheet. First of all, thank you very much. You were right. The IPO of Qualtrics was very successful. Nevertheless, for several reasons, we can exclude the thesis that this was a test for other parts of the company.
On the one hand, Qualtrics had been part of our group of companies only for a short time, which means it had not been as well integrated as other parts of the company. On other hand, Qualtrics as a solution is rather an analytical platform rather than a transactional business process application, which most of our other solutions are, and for which a stronger integration is more important also for the purpose of our customers. For that reason, this was not a test run, but it really was a unique one-off measure, which, however, turned out very positively. The successful IPO of Qualtrics certainly also confirmed the valuation of the Qualtrics goodwill. In the final analysis, an IPO cannot generate such a value itself. What really is decisive is the outlook for the future and the respective payment and cash flows.
They are actually determining the valuation or recoverability of the goodwill. This, in individual cases, can also be influenced positively by changes in the ownership structure. We also said that with the help of Qualtrics, we'll also be able to better succeed in non-SAP ecosystems. This is really a question that you need to answer on a case-by-case basis. It's not a general question. This brings me to a question Mr. Buhlmann had on the employer situation. For that purpose, I hand over to Sabine.
Thank you, Luka. Effects of working from home. Mr. Gabler and another shareholder, whose name will not be given here, has asked, what effect do you see and expect from the fact that many of your staff work from home? What does this mean for your locations, and what will be the future? If I can respond to this briefly, I would like to point out that I think we have a consensus that flexible work as a result of the pandemic is here to stay, not just for SAP, but for many companies. Since we are a tech company, this is helping us. As employers of more than 100,000 staff, this is something that will continue. Before the pandemic, we already had flexible working modes for our staff. They could work from home flexibly, depending on the local legislation, of course.
We now have 90% to 95% of our employees working from home. We are currently evaluating how this develops and how we can continue the flexible working modes even after the pandemic. Today, we cannot make any statements on locations and effect on locations. It's too early for that. That, I think, takes all the questions of the BVI. We then move on to Ingo Speich of Deka Investment, and that takes me to the end of my part, and I'll hand over to Christian Klein.
Right. First question, when will you have finished the cleaning up after the McDermott era, and when will you have concluded the integration of your acquisitions to a decent degree? In the course of last year, we created one foundation for a seamlessly integrated intelligence suite. This includes cloud solutions such as Ariba, Fieldglass, SuccessFactors, and Concur.
They are now seamlessly integrated with SAP S/4HANA. Now, as a next step, we are expanding that integration step by step, and our focus will clearly be on core subjects like integration into non-SAP solutions, unified data models between applications, pre-integrated analytics, and uniform extensibility. Our open SAP Business Technology Platform plays a central role in all that. We will keep our customers informed about our progress on a regular and transparent basis. The fact that we are successful here is shown, for example, in the fact that the satisfaction of our customers rose significantly during 2020, by 10 points year-on-year. The next question was already asked in a similar way by Markus Golinski of Union Investment. We'll take this question or these two questions at this point. How will you get your customers to move away from the licensed business and into the cloud?
Well, the pandemic has massively accelerated the trend toward digitalization. The change from analog to digital has been taking place for years, but it has now made industries move, which might have taken a little longer in other circumstances. No matter which customer I talk to, they all want a fast and easy route to digital transformation. Because digital technologies are helping them overcome the pandemic, and the companies that have already digitalized their business models are coping better with the current situation. The cloud has a major role to play here, because apart from its many other benefits, chief among them are flexibility and even better access to data, and hence, knowledge. With RISE with SAP, we are offering customers business transformation as a service to make the digital shift into the cloud as easy as possible. This offering is addressed to existing and to new customers.
In the first quarter 2021, we already got more than 100 contracts for RISE signed, and the demand continues to be high. Our SAP Business Technology Platform also has a crucial role to play in the transition of our customers into the cloud. It makes integration, building, and enhancing solutions easy, and it is also the foundation for our modular industry-specific cloud solutions. Now a question from Mr. Speich. How do you balance margin development with growth? For us, it is clear that we will not weigh the success of our customers and the significant growth potential of SAP against short-term priorities. This is why we are making investments into our portfolio and innovations to accelerate our growth in the cloud. Each and every one of our business models must and will grow profitably in that process.
We are bringing our business into the cloud faster, corporate profits will be moved into the future. The reason for this is that we are converting the classic business model of selling licenses to the subscription model, the typical cloud model. In the long term, this model produces higher recurring revenue. However, in the transition phase, total revenue growth and bottom line are impacted. We expect that from 2023, most of that phase of transition will be behind us. Revenue and profit growth will clearly accelerate, and we are expecting double-digit growth here. Such effects have already been observed with other successful software companies like Adobe, which went through this business model transition already. Despite that, we are exercising continued spending discipline, and here we've made significant progress last year.
For example, we could increase our profitability in the cloud and improve non-IFRS cloud gross margin from 68% in 2019 to approximately 70%. We assume that this positive trend will continue and that in 2025 we will achieve a non-IFRS cloud gross margin around 80%. In sales and marketing, we have streamlined our structures further. In the administration, there are significant economies of scale and a high automation potential. Important processes are already transacted digitally and independent of the location, starting with sales to signing the contract to implementation and operation of our software, which also works really well during a crisis in remote mode. Our development is becoming more efficient. We continue to invest there, and one thing should be clear, we see this area not as a margin driver, but as a growth driver.
Next question is: given your current sluggish speed, how are you going to catch up with your competitors, Salesforce and Workday? I already mentioned why our revenue is a little lower at the moment, because our cloud business is growing rapidly, and it is above the growth of our competitors. We have significantly increased the speed of our transformation in the last few months, and this is also reflected in our performance figures. Cloud revenue increased by 18% in 2020 and continued to be the major growth driver. A decrease in business travel impacted transactional revenue in our Intelligent Spend business. Excluding this effect, our cloud revenue grew by an impressive 27%, which is actually competitive with our competitors. This fast growth is absolutely comparable with that of our competitors in the cloud that you mentioned. As we said, we expect a further acceleration of cloud revenue.
In Q1, we could report the fastest growth in new cloud business in five years. Our revenue with SAP S/4HANA Cloud, our ERP core product, has grown by 43% in Q1. There is no competitor solution that is growing faster. With RISE with SAP, we are accelerating the migration of our existing customers into the cloud, and we are also winning a significant number of customers. We've also stepped up our speed of innovation. The central component here is our SAP Business Technology Platform.
At this year's SAP Sapphire, our annual customer conference in early June, we will announce a real firework of innovations. With that, I'll hand over to Friederike.
Mr. Speich asked a question to Hasso Plattner, which other shareholders have also mentioned, and that concerns his succession planning. Mr. Golinski of Union Investment and Mr. Hendrik Schmidt of DWS Investment asked the same or a similar question.
I will respond on behalf of Mr. Plattner, and the question was, when will you, Mr. Plattner, hand over the staff? We see this concentration of power critically, and we think there should be a succession arrangement which will result in more independence and also becoming younger of the Supervisory Board. As you could hear in his contribution, Hasso Plattner made a specific statement on this. At this point, I would like to refer you to what he said, and I can only reiterate here that Hasso Plattner intends to stand for another period of a maximum of two years again, and after that re-election, he will hand over his function as chair of the Supervisory Board to a successor. At this point, let me add something from the point of view of the Supervisory Board.
The succession planning for Hasso Plattner as chair of the supervisory board is, of course, a task for the whole supervisory board, not just a personal choice of Hasso Plattner. We are all very aware that this is a very important step for the company because the last founder will leave the company. Describing what Hasso Plattner did for this company would be too much for this AGM. We can only say that it's hard to imagine SAP without him. It's impossible to do it, and without him, this very successful company wouldn't exist. It's in the interest of SAP to go this step in such a way as to ensure stability and continuity of leadership, especially in that phase of transformation towards a cloud company, where this is so important. Next is a question from Mr. Speich, too.
In 2021, the supervisory board reduced the threshold value for the short-term incentive from 75% to 50%. Why was this reduction done, and only after the new remuneration system existed for only one year? The threshold, which will apply from the year 2021, of 50% for the short-term incentive, was decided in early 2020 and was part of the remuneration system presented to the AGM in May 2020. The reasons lie in the overall concept of the STI plan. The short-term incentive is measured by the achievement of six targets. These individual targets all have a minimum threshold of 50%. In addition, there is another hurdle for total achievement score, and in order to harmonize these two levels of hurdles, the threshold for overall target achievement was changed from 75% to 50%, starting in 2021.
We consider this appropriate because our short-term incentive has very ambitious goals, and they are always reported in our remuneration report for the previous year. I'll hand over to Sabine for questions on employees.
Mr. Speich had two questions concerning our employees, and I'll be happy to take them. The first one, diversity quota are not a panacea, but what are you doing specifically to make SAP more diverse? Will it help you to improve a lack of innovation ability? Well, first of all, SAP has no internal quota or percentages for management level. What we do have are clear targets in different dimensions of diversity, and these extend to all areas of business and all regions, and they are individually fine-tuned. SAP's goal by 2023 is to have a global share of women in managerial positions of 30%.
Of course, for us, it goes without saying that diversity and heterogeneous teams have an absolutely fantastic effect on the innovation power of a company. We are training our managers with regard to personnel recruiting, and we are making sure that there is very close collaboration of the different HR departments in the regions, and especially when it comes to reskilling and retraining managers. The next question from Mr. Speich was how high was the fluctuation rate on the first and second management level since the last AGM, and how does this compare to the previous year? The answer is quick. The fluctuation rate on the first and second management level rose slightly. In May 2021, this was at 5.7%, and in the previous year, 4.8%. With that, I'll hand over to Luka Mucic for the financial questions.
Yes. Thank you very much, Sabine.
The first question on the financial effect on the changed strategy. In addition to Mr. Speich, Mr. Buhlmann, Mr. Schmidt of DWS, and Mr. Gabler submitted similar questions. We are responding to those questions here. Can you describe the development of your revenue and margin targets for 2025 over the next years, and what makes you so sure that you'll achieve them after two disappointing years? Well, on average, our cloud revenue and our sales revenues in total, starting 2020 up to the year 2025, will grow by 22% per year or 6%, respectively. With a different growth characteristic in the first two years versus the year from 2023.
In the revenue development, the strategy and the change of the business model are having an impact, because of the faster transition to the cloud, the share of immediately realized versus recurring revenue is changing. So the increase will be slow at first, then starting 2023, the curve will go up faster when we have a higher share of business in the cloud. On the operating profit side, the target is more than EUR 11.5 billion in the period up to 2025. This corresponds to a growth of 7% per annum between 2020 and 2025. Here, the accelerated change to the cloud is important because currently, the margin profile is different compared with the software license and support business, although with 80% by 2025, the gross margin target is pretty close to the classic margin.
In order to achieve these cloud margins, I think we mentioned this, we will significantly harmonize efficiency of our cloud infrastructure over the next two years, we actually invest into that in the next two years. This will be a mid-three digit million amount in 2021 and 2022, that will reduce the increases on the operating profit side. After that, it will take effect, it will accelerate the margin. There will also be investments into development resources to make sure that innovation continues in the cloud. In the next two years, we'll also have a little bit of headwind, that will be reflected in a flat performance or a slightly declining performance, which will have an effect on the operating margin. We see these investments as necessary in order to position SAP for the future in a sustainable way.
This means that our assumption for the development of our recurring revenue is positive. Up to the year 2025, we are going for a relatively high share of the more predictable revenues. In a situation as we see now, this is worth a lot. It's making us resilient, and it's the way to go forward. In the year 2021 and 2022, we are optimistic the changes we are making are right, and after that will be in excellent shape for a disproportionately high growth rate, both on the revenue side, but also on the bottom line side, where we will return to double-digit growth. The cloud portfolio will obviously contribute very much to this. From the existing portfolio, we have growth rates of 15%-20%, and on top of that, we have the RISE with SAP contribution. That initiative is contributing.
At the beginning of the year, we already showed that with a strong growth of S/4HANA Cloud, that our growth potential is an additional boost. In the future, we will transparently report on that development and show you that this strategy is working. We'll certainly increase trust on the capital market that we're on the right track, which will be value-enhancing for SAP.
A couple of questions related to sustainability, and I'm very happy about that because I'm the board sponsor of sustainability. How high will the share of suppliers be that you integrate in your climate targets 2025?
Well, in a nutshell, 100%, because we expect all suppliers to deal responsibly with the environment and to be committed to environmental protection. In our SAP code for suppliers, they are called upon to contribute to achieving the SAP climate targets.
The second question here, do you plan a fixed investment contribution to acquire or to gain a share in companies similar to the Climate Innovation Fund by Microsoft?
Yes, we do that. Since 2012, we've been investor in the Livelihoods Carbon Funds. For years, we've invested strategic investments in environmental projects with highest quality standards, which have ecological and social effects. We also have introduced an internal CO2 price on business flights. We plan further strategic investment in certified environmental projects, which have a positive contribution to the reduction in greenhouse gas emissions.
The last question here. With the current sustainability strategy, do you think you're well-positioned with that, even though the EU and the Federal Court have posed even stricter requirements?
Yes, absolutely. To achieve our vision, our sustainable business strategy focuses on positive impacts and changes in the limits of planetary borders and to implement any legal requirements early on. You might know that SAP was one of the first companies to offer integrated reports covering non-financial aspects of the business too. We've been the leading company in the Dow Jones Sustainability Index for software companies.
We've set ourselves even higher and more ambitious environmental targets. Last time, advancing the level of being carbon neutral by 2023, two years sooner than before. We want to have maximum transparency and be the front runner in this field. That brings us to the end of the questions brought forward by Deka, and that takes us to Union Investment and Markus Golinski's questions. I'd like to hand over to Christian.
Now, the first question. With the consistent realignment to the cloud-based business model, did SAP actually wait too long with that reorientation? Shouldn't you have prepared the market sooner and prevent the shock? Well, the decision to reorient SAP to a cloud-based business model was the consequence of several independent events.
As mentioned before, the start of the COVID pandemic increased the demand of customers to modernize their system environments, landscapes, and to migrate to the cloud to be more agile and better prepared for the crisis. When I became sole CEO of SAP, that happened during the beginning of the COVID pandemic, and one of the first actions I took was the new strategy, which was finalized in accordance with the Supervisory Board. At the same time, the strategy update was translated into updated finance targets. Here, the financial impact of the Corona pandemic, the recovery scenarios, and the latest developments in currencies were considered. The final discussions with the Supervisory Board and the following approval happened briefly before we published third quarter results. As a result, the strategy update and the latest finance figures had to be immediately published as an ad hoc report.
With the publication of the second quarter 2020 results, we've already indicated that a strategy change was imminent. However, due to the unfinished aspects, we couldn't publish further detail. The next question. When will SAP return to the future growth path? Where are the biggest risks? Well, in 2020, we expect our cloud revenues to raise from EUR 8 billion to EUR 22 billion in 2025, so an average growth of 22% per year. All in all, in 2025, we expect sales revenues of at least EUR 36 billion. Calculated as of 2020, this equals an annual growth of at least 6%. As communicated before, due to the sheer mechanic of the existing change in business model, we expect moderate growth in total revenues for this year and next year. However, we expect considerable increase in the speed of development as of 2023.
This also applies to our operating profit in terms of non-IFRS. The biggest risks here are covered in our integrated report and in the chapter Risk Management and Risks. We continue with questions related to the Supervisory Board, and I hand back to Friederike.
Markus Golinski too has sent us questions directly to Hasso Plattner, and I am going to answer in his name. Hasso Plattner, we request an independent composition of the committees of the Supervisory Board that is not given right now. When will you comply with these requests? Over the course of the last year, we have considerably refurbished the Supervisory Board, thus preparing the company for the challenges of the next 10 years. SAP has mapped the competencies of the board members with a comprehensive competence profile, has reduced average term of office, increased the number of independent members, and also increased diversity.
At the same time, we've shaped the terms of office more flexible so that we can respond faster if changes in the setup are required, so that shareholders can select and elect their representatives more often. This year, we continue the reshuffle of the supervisory board, and insofar as the AGM approves the nominees, Dr. Qi Lu and Dr. Rouven Westphal, we'll have two more independent members in the supervisory board, and as a result, also in the committees. Soon after the AGM, the supervisory board would also look into the setup of the committees, and strengthening the independence will be a major criterion when we decide on the setup of the committees. Another question. Mr. Plattner, will the sustainability goals also become part and parcel of the long-term variable remuneration of the executive board? We'd welcome that. Well, since 2020, sustainability goals are part of the STI.
These are annual goals. They are derived from our midterm targets. We're currently of the opinion that sustainability goals are appropriately considered in the pay of the executive boards. Currently, we don't plan to consider sustainability goals in the long-term plan. We relish the feedback from investors, and we discuss and monitor that regularly in the supervisory board. The questions from Hendrik Schmidt from DWS, and Christian takes over.
First question. The revision of your business goals for 2020 above all, as the revision of the midterm outlook past October led to clearly negative reaction at the stock exchange. What were the major reasons for these decisions, and what do we expect in terms of short-term revenue and earnings development?
Well, the 2020 figures were adapted in line with the development at the beginning of the COVID pandemic to reflect the impact the pandemic had on demand and forecasts. Along the same lines, the midterm outlook was adapted to cover the financial impact of the COVID pandemic and the recovery scenarios and the development of the U.S. dollars. The strategy update was also translated into updated financial targets until 2025, which includes the decision to faster develop towards a cloud-based business model. The outbreak of the coronavirus pandemic was one of the driver of the strategy updates because the demand of customers increased to modernize their system landscapes and to migrate to the cloud to be better and more agile prepared for the crisis.
Due to the transition from the upfront license business to the gradual cloud business, revenues will grow slower due to switch in the business model. As of 2023, growth will be faster. Similarly, the growth of operating result will be moderate. In 2021 or 2022, we expect no or slightly negative growth. This results mainly from the investment in the cloud business. For instance, by the increased harmonization of the cloud infrastructure, which we plan to implement in 2021 and 2022. Next question. To what extent have the current development in the context of the COVID-19 development impacted your decisions? Well, the outbreak of the COVID-19 pandemic was one of the main driver to update the strategy, since the customer demand increased to modernize their system landscape and migrate to the cloud to be better prepared for the crisis. Next question.
We get both from customers as well as from employees extremely positive feedback. Both in numerous personal meetings as well as in the strategic surveys, we can see that our employee engagement index increased from 83% to 86% in 2020. The leadership trust, that's the KPI for the trust of employees in the managers, rose from 59% to 62%. At the customer side, the Net Promoter Score, with which we measure customer loyalty, this Net Promoter Score increased by 10%. Next question. Which role play acquisitions in the framework of the new midterm strategy? To achieve our new midterm strategy, acquisitions will only play a minor role.
Our focus still is on organic investment in technologies and innovations, which secure sustainable growth in our solution portfolio, thus contributing to achieving our short, mid, and long-term goals. In addition, we might have targeted acquisitions to supplement our solutions and to cover important strategic markets in a better fashion. Next question. What's the current status of customer migration regarding SAP S/4HANA? Well, the momentum of SAP S/4HANA is still unbroken. At the end of the first quarter 2021, more than 16,400 customers have opted for this solution. Out of which more than 9,600 have gone live. As regards financial figures, I'd like to hand over to Luka.
Thank you. Next question deals with the margin development. You've redefined your targets for the period until 2025, and you expect an expected growth in the cloud field and negative effects in the license business. How will that impact margin?
Well, the margin has grown for two years. Over the next two years, 2021 and 2022, due to the additional investment in the cloud infrastructure and due to the transformation of the business model towards an increased shift in to the cloud model with lower gross margin, we expect a decline in margin. As of 2023, once the biggest share of our business, the new business, will be transformed into the cloud, we expect considerable increases in operative margin. As of 2023, margins will skyrocket again. Next question, what is the impact of the new strategy on the service revenues? The new strategy, in particular, the new RISE with SAP to support existing customers and transform them to the cloud, will lead to a decrease in service revenues to the benefit of faster growth in the cloud revenues.
We expect a drop over the next years in service revenues on average in the lower to mid-single-digit percentage share. Next question, which implication has the new strategy regarding the development of recurring revenues? Well, of course, it leads to a considerable growth of more predictable revenues by a 3 percentage point to 75%. By the end of 2025, we expect this share to increase to 85%. Another question, what are the new KPIs you're going to use to assess the implemented strategy and do adjustments? Well, on the one hand, we've been doing this since the first quarter 2021 with our new KPI current cloud backlog and specific contributions of the SAP S/4HANA Cloud. In addition, as of next year, as an additional metric, we plan to use the annualized ARR for this area.
For that, we have to provide the internal requirements so that we can report it reliably. Mr. Schmidt had also questions as regards corporate governance, and I'd like to hand over to Friederike.
Well, can you please put into perspective the EUR 15 million paid as severance payment to Jennifer Morgan? Which parameter determined this value, and how did the Supervisory Board establish that that's a matter of course or that it's usual? The severance pay to Jennifer Morgan was based on the contractual conditions. The level of the severance pay is based on the base salary and the outstanding STIs for the remaining terms of contract. Here the rules and regulations of the German Corporate Governance Code were considered. Next question, we will vote in favor of Mr. Qi Lu, and we welcome the consolidation of the expertise in the Asian, specifically the Chinese market.
Please tell us which mandates he held and how much time he has to spend, and also the potential for conflict of interest. Well, Dr. Lu has the following mandates in other companies as the SAP. He is a member in the board of directors of Pinduoduo Inc, a publicly listed Chinese company. In addition, he is the chairman of the board of directors of three further companies, namely Pinefield Holding Limited, Cayman Islands, and her 100% daughters, Pinefield Holdings Limited in Hong Kong, China, and Pinefield Limited, Peking, China. The time required for the task involved can be assessed as follows. The mandate as Pinduoduo Inc, as one of the big publicly listed company, can be compared to the activities in the supervisory board at SAP. The three Pinefield mandates, however, will be considerably less time consuming.
With Pinefield Limited seated in Peking, that's a Chinese startup company that's held by a holding company in Hong Kong, which in turn is held by a holding company in Cayman Islands. This is a usual construction in China to hold investment in Chinese companies abroad. The board mandates in the two holding companies cannot be compared with independent control activities that go beyond the control of the activities of the operative Chinese daughter company. With a view to the sheer scope of the control and monitoring activity, in the end, it's only the mandate at the operative daughter company that counts. Here with the Pinefield mandate, it has to be considered that Dr. Lu already does this in the course of his main job as a CEO of MiraclePlus, that acts as a foundation center and startup investor.
All in all, we thus assume that Dr. Lu has sufficient time to fully fulfill all tasks linked to the mandate at SAP. We don't see any reasons to assume that due to these mandates that there might arise a conflict of interest for Dr. Lu. In particular, there are no relevant business relationships between SAP and Pinduoduo.
Neither with SAP Fioneer. Mr. Schmidt had asked some questions about the organization of this AGM, which were also asked by Mr. Gabler, and I'd like to answer those questions together now. First question, how many questions did you receive for the AGM? We received a total of 123 clusters of questions with a total of 269 individual questions. Next question, how many questions will you answer? Now, as you certainly know, it is up to the discretion of the executive board to dutifully decide on the way questions are to be answered, and all of this is based upon the COVID-19 Act. However, we will answer all questions comprehensively, either individually or if there are identical questions, of course, we will answer them together. Which are the criteria that apply for answering the questions? Well, as we answer all questions, no specific criteria were applied.
Only if there was obvious duplication of questions, we clustered them, and we then also disclosed the names of the shareholders who had asked the questions if that was desired, and then we provided the answers. Now this marks the end of the list of questions of Mr. Schmidt, but he has also asked us to read out the following lines. "We thank the Executive Board and the Supervisory Board, and of course, also all employees who have worked hard for the success of the company in the past and also in the current fiscal year in such difficult times, and we ask you to pass on this gratitude to all of the employees.
We thank you for answering these questions as part of the AGM, and we expressly approve our names to be disclosed during the Q&A session. Well, thank you very much for these friendly words, Mr. Schmidt, we now continue with the questions of the individual shareholders. The next shareholder does not want his name to be disclosed, I hand over to Christian again.
Thank you very much, Friederike , I also would like to thank Mr. Schmidt for his positive statement. Now the question is as follows. I agree with the executive board and the supervisory board in the decision to accelerate the implementation of the cloud strategy. Now, this decision, I think, was overdue. If you look at the status other companies have reached with their cloud strategy, they have even built up new economies on this basis.
Compared to that, SAP is lagging behind like the one or the other customer. SAP wants to become the Amazon of the industries. Integrated cloud strategy also requires an appropriate risk management. My question on this is as follows. How can you make sure that your own cloud servers can actually handle the tripling until 2025 as announced? We have adopted a so-called four plus one cloud strategy for SAP. According to that strategy, the SAP cloud infrastructure can be operated in data centers owned by SAP and also at four hyperscalers, AWS, Google Cloud, Microsoft Azure, and Alibaba Cloud. In this context, SAP draws up a comprehensive capacity plan which covers its own data centers as well as the hyperscaler capacities. Thus, we make sure that both environments are prepared for the expected growth. Next question.
How high is the capacity utilization of the existing servers today? Which CPUs have been installed in your own servers? Are these only x86 processors? The capacity utilization of the internal infrastructure is subject to fluctuations and always marks a compromise between efficiency and the safety buffer. In most cases, it ranges between 50% and 75%, but there are major differences to be observed. The less elastic legacy infrastructures, which we have usually taken over in the framework of company acquisitions, they usually have a significantly lower capacity utilization compared to our new standardized and much more flexible converged cloud infrastructure. This year and next year, we want to migrate our cloud existing customers to this new infrastructure. This should lead to a significant increase of the average capacity utilization. We cannot discuss details of the technical composition of our cloud infrastructure at this point.
It goes without saying that we apply commercial standards, which undoubtedly also include x86 processors. How does SAP assess the risk of x86 processors being attacked by hackers, for example, through side channel attacks? Answer. Over the last few years, there have been several simulated and also actual hacker attacks which specifically targeted x86 and x64 processors. SAP has implemented a comprehensive hardware and software lifecycle management in order to support our own infrastructure. Operation of the current versions at any time, also using corresponding side channel protection, represents an additional safety and security level. The operating system and special software is always kept up to date in order to block off any potential attacks. Next question. Is the implementation of the cloud strategy slowed down by the shortage of chips, which has been present for months? The current situation also does not go unnoticed by us.
However, it has not led to a delay in our cloud strategy. We are working together with hardware providers on a strategic level. This ensures transparency of our supply chain and ensures also a high availability of future shipments. How does demand develop regarding in-house and hyperscale cloud services? Is the hyperscale business growing faster? The hyperscaler capacity used has recently grown faster than the internal capacities, and according to our plan, this is also to remain so. Intensive utilization of the hyperscaler capacities is part and parcel of our four plus one strategy.
With the help of this strategy, we can lower our costs of capital and increase the flexibility of our cost base. Major purchasing volumes, furthermore, also lead to more attractive purchasing terms and conditions with the hyperscalers. Next question. What are the margins that you generate with your in-house and with the hyperscaler services? Very good question.
In order to avoid potential disadvantages compared to our competitors, we cannot discuss any details here. Let me tell you this, irrespective of the infrastructure used, we expect an adequate profitability. That is also expressed in our target to reach a cloud gross margin of approximately 80% by 2025. Now regarding the capacity we obtain from hyperscalers, here we benefit from attractive purchasing terms and conditions, as mentioned initially, due to the bundling of customer demand and due to the competition amongst the hyperscalers for the very attractive SAP workloads and data. At any time, we've got the option to switch to in-house capacities if this makes sense, economically speaking. On the whole, however, it will also be very decisive to reduce the capacity demand of the individual cloud solutions, and we are working very intensively on this. Next question.
Can the hyperscaler capacities be ramped up quickly if demand picks up rapidly? Hyperscalers have significant cloud infrastructure capacities on a global scale, as Thomas has already stated. Usually they are fully sufficient for the SAP demand. In order to ensure that at any time we can also cover peak loads on a regional basis or for specific cloud services. For that purpose, we have introduced a demand forecasting and planning process with the hyperscalers, and we thus transmit early indicators to the hyperscalers to allow for efficient capacity planning. Next question. How does SAP handle the security risk due to cloud instances of different vendors which still do not have any standardized security protocols? The public cloud infrastructures are implemented, those used by SAP at least, are implemented on the basis of the secure by default standard and also reviewed regularly.
SAP uses the native security functions of the respective vendor and also uses internal and external security software, which allows us to set up standardized security controls. With this combination, not only do we ensure that industry and legal standards are complied with, but we offer an industry-leading security concept which goes far beyond that. For the next couple of questions, I hand over to Luka again.
Thanks, Christian. Next question. The announcement of the accelerated implementation of the cloud strategy and the related cost lead to a massive slump of the share price from a price close to the all-time high, almost down to the COVID-19 low. That strategic plan, which is significant, wasn't it discussed with major investors beforehand, or were you not able to convince them of the benefits and success of the accelerated implementation of the cloud strategy?
Well, I already tried to explain to you that the significant change of our strategy and the related financial consequences, once we had developed them, well, we considered them as, or we had to consider them as insider information because we had to expect that they might have led to a significant market response, which actually happened. Well, in that situation, if you want to stick to the law, which we do, in that situation, you cannot discuss this information selectively with strategic investors beforehand in order to know what their view is. Therefore, the answer clearly is no, we would not have been allowed by law to discuss this adjustment with major investors beforehand, and that's why we didn't do so in the first place. Second question. Were the massive support changes, especially by the Hasso Plattner Foundation, discussed beforehand with the Executive Board and/or the Supervisory Board?
This question also goes to candidate for the supervisory board, Mr. Westphal. Let me first of all remind you that at this AGM, no questions can be directed to Mr. Westphal, who is today only a candidate for the supervisory board. I can answer your question nevertheless. The shares purchased specifically by Hasso Plattner Single Asset GmbH & Co. KG and Hasso Plattner Single Asset GmbH & Co. KG in late October had not been coordinated in any way with the executive board or the supervisory board, but they were based upon independent decisions of these two companies. Furthermore, we would not consider these purchases as support purchases because the overall volume was not significant compared to the overall market capitalization of SAP.
Furthermore, just for the sake of completeness, I also would like to emphasize that amongst others, Christian Klein, I myself, and some other board members and supervisory board members purchased SAP shares after the publication and the decrease in share price. We did so to send out a signal of trust in the cause and the strategy adopted by the company. Of course, all of these transactions were made fully transparent by SAP in accordance with the capital market rules and laws. Did the executive board have any indications of an intensified short-selling activities? No, we did not have such indications. Is Mr. Westphal also proposed as a representative of the shareholders in the supervisory board because as a managing director of Hasso Plattner Foundation, he represents not only a major investor but also a strategically important shareholder.
Now, we would like to emphasize that the nomination of Dr. Rouven Westphal for the supervisory board is specifically as an independent candidate, and his nomination is only based upon the profile of his know-how and expertise. Yes, Dr. Rouven Westphal is member of the board of the nonprofit Hasso Plattner Foundation that was established by Professor Plattner, which is an independent one, however, of his person. The foundation is currently holding SAP shares to the extent of about 3% of the equity of SAP SE, and Professor Dr. Plattner is not a controlling shareholder of SAP according to the German Corporate Governance Code. Now, there's a comprehensive list of questions of a shareholder on the recent settlement with the U.S. criminal prosecution authorities in the Iran sanction procedure.
First question, why did SAP conduct not approve the Iran transactions over many years, especially as this has happened in the term of Bill McDermott, who is a U.S. American and who is a natural person, even, is compelled to comply with U.S. sanctions. Now, let me clearly state this. The SAP policy prohibits transactions in countries where, due to an SAP business decision, our software and services is not available, and this also includes Iran. Most of the transactions at issue occurred because third-party resellers violated SAP policies and conducted non-authorized transactions with Iranian companies. Other non-authorized transactions occurred due to control gaps within the companies taken over by SAP. SAP has remediated these problems and will continue to comply with all applicable laws. Secondly, did SAP not apply for approval for these transactions, or was such an application rejected?
Answer, we did not apply for approval for the Iranian transactions. Next question. Who did put these violations in 2017 onto the agenda of the Executive Board? SAP's compliance team and the export control team have identified the problem and escalated them to the Executive Board. Next question. It said that SAP is the first company which utilized the voluntary self-disclosure program of the U.S. government, which was launched in 2016. What triggered this decision? Answer, as a company listed in the U.S., SAP is obliged to report certain Iran activities to SEC in the framework of the 20F disclosures. Due to the nature of the Iran violations, SAP then also decided to utilize the benefits of the program on voluntary self-disclosure.
Fifth, what has changed in risk management that caused SAP consider the risk of charges brought forward by the U.S. authorities to be lower than the penalty or the fine expected under the voluntary self-disclosure program? As specified by U.S. authorities, the voluntary self-disclosure program offers the possibility of having lower fines and a possibility to avoid criminal prosecution for acts of the past. SAP has been able to benefit from these advantages. This was not based upon a long-term risk assessment, but as soon as the violations became known, we immediately also resorted to the voluntary self-disclosure program. Sixth question, did the takeover of the American government by President Trump and his rejection of the Iran agreement and the tightening of sanctions, did that play any role? Answer, no. Seventh question, did U.S. authorities threaten to file charges against us? Answer, no.
SAP disclosed the potential violations to the U.S. authorities proactively and voluntarily. Due to the voluntary self-disclosure of the company, the comprehensive willingness to cooperate, and the strong remediation measures of SAP, and that's important. For that reason, U.S. authorities decided not to file charges against SAP. Next question. Was that voluntary self-disclosure in the U.S. done based upon a recommendation of the supervisory board? The voluntary self-disclosure in the U.S. was based upon a decision of the executive board, which, however, was closely coordinated with the supervisory board. Ninth question, who communicated the decision to the customers affected, and how did they respond? SAP and its lawyers communicated the situation with various customers and found appropriate solutions. 10th, which supervisory board committees dealt with the comprehensive investigation? It was the audit committee which continued dealt with that matter and which was also notified regularly.
11th, what exactly was the result of the investigation regarding risk management? Had it already been set up for effective dealing with U.S. sanctions? Answer: SAP has remediated the behavior in the past and has also developed stronger controls, which are now better suited to mitigate the risks. 12th, can you exclude the possibility that departure of the two U.S. American board members, Bill McDermott and Jennifer Morgan, and departure of the Supervisory Board member Diane Greene, who is also a U.S. American from the Supervisory Board, is somehow related to the violations against U.S. sanctions against Iran, which now you have admitted to? Answer: The departure of the members of the Executive Board and the Supervisory Board were not related at all to these investigations. Did these persons potentially assume personal liability for the violations against the U.N. sanctions which occurred during their terms?
Did U.S. authorities threaten these persons to launch criminal prosecution? Answer: No, U.S. authorities did not threaten to launch criminal prosecution activities against board members. Next question. With its decision to appoint Mr. Lu as successor for Ms. Greene, according to item six of the agenda, now did the Mannheim District Court do so in order to have another U.S. citizen on the Supervisory Board? I assume that the appointment of Mr. Lu is based upon also discussions with SAP Supervisory Board. The court order to appoint Mr. Lu was indeed based upon a proposal of the Supervisory Board, but there were no requirements by the District Court that it has to be a U.S. American citizen. He was only selected due to his know-how and experience, which is very good supplement to the competence and know-how of the Supervisory Board.
Was the citizenship of Qi Lu part of the agreement with the U.S. criminal prosecution or through authorities to make sure that in future there's another U.S. citizen again on the Supervisory Board to monitor compliance with U.S. sanctions? Answer: No, there was no such agreement. Next question. Did the court order appointment as a Supervisory Board member of Aicha Evans, a U.S. American in 27, somehow relate to sanction violations? Answer: No. In connection with the violations and their remediation, was there also communication with the U.S. Embassy in Berlin? Answer: No. Did SAP notify the German federal government and/or EU bodies on short notice on the violations and potential threats of the U.S. authorities? Answer: SAP notified the competent German authorities on the investigation and the agreement.
19th, if so, did SAP coordinate these actions, that is the voluntary self-disclosure, with these authorities, and was SAP supported in the view of the Executive Board? SAP only notified the German authorities, and of course, that procedure was coordinated within the Executive Board. Does the self-disclosure and the payment of the fine mean that Executive Board and the Supervisory Board, with the purchase of SAP software and services by Iranian customers, share the view of the U.S. authorities that SAP has thereby undermined the objectives of the U.S. sanctions against Iran, i.e., primarily the prevention of support for terrorism and Iranian aggression, in particular against Israel, and in connection with this, the further potential development of the Iranian nuclear program also for military purposes and the U.S. national security, according to U.S. Attorney General Nathaniel Mendell ?
Answer: It is not up to us as SAP to assess the targets of the U.S. sanctions against Iran as established by the U.S. government. SAP would like to emphasize that all of the three U.S. authorities have appreciated SAP significant efforts to strengthen its export controls. For any further information, we'd like to refer to the actual agreements with the U.S. authorities and SAP's public disclosure regarding the consensual solution. Next question. Mr. Mendell is also quoted as follows: "It wasn't anything that would pose a more serious threat. It was the more standard SAP suite." Does actually say that the business with Iranian customers and the SAP software does not pose any serious threat. Don't you thus see the opportunity to obtain approval for business with Iranian customers?
The answer, once again, it is not up to SAP to assess the interpretation of the targets of the U.S. sanctions against Iran by an official of the U.S. government. We as SAP, we always want to comply with all existing export control and sanction laws. The regarding policy has once again been confirmed by SAP on its website, sap.com, under export control and sanctions. For further information, we once again would like to refer you to the actual agreements with the U.S. authorities and SAP's public statement regarding the consensual solution. Next question. In spite of comprehensive cooperation with the U.S. authorities, the proceedings lasted for three years. Why did that take so long? Answer: The investigation did take some years because, as is usual in comparable cases, because comprehensive and very thorough investigations had to be conducted. Next question.
What does it mean that the executive board and supervisory board assume full responsibility for the sanction violations? Does this mean that the executive board and supervisory board will compensate the company for the existing damage? As part of the agreement with the U.S. authorities, SAP assumed responsibility for the sanction violations detected. However, in context with the investigations performed, no individual fault of individual existing or former executive board or supervisory board members was identified. There's also no basis for any potential damage claims against members of the executive board or supervisory board. Next question, do you see a possibility that the fine paid by SAP and the loss of business of the Iran business is recovered or is compensated for by EU on the basis of the blocking statute if this is not fully covered by the D&O insurance? No, we do not see this possibility.
Next question, does the executive board and the supervisory board see the risk that SAP will be fined by the EU on the basis of the blocking statute because SAP submitted to U.S. sanctions? Answer, no, we consider this risk to be low. Does SAP also check whether SAP partners have conducted non-approved businesses with Iranian customers or still do so? Does SAP adopt any sanctions against these partners? Yes, we monitor the SAP partners and their compliance with the SAP policies. 27, if so, how many partners are affected by this? The answer is quite simple. All partners, because we expect all partners to comply with the policies and processes. If sanctions have been imposed against SAP partners, are these partners then also threatened by legal charges brought forward by the U.S.?
Answer, as far as we know, the U.S. government has not designated any other entities which might be facing proceedings. 29, did SAP damages to Iranian customers for contractual obligations not fulfilled after 2017, or for any contracts that have been terminated? Are such claims by the customers affected against SAP still pending? Answer, no. Next question, to what amount did you form provisions in the annual financials 2020 for the settlement aimed for with the U.S. authorities? The provisions set up as of the 31st of December 2020 within a framework of the investigations regarding embargo violations were non-material from the point of view of the SAP group, as shown in the annex to the consolidated financial statements in section Z3 and on page 213 of our integrated report. Is SAP talking to other countries or authorities of other countries regarding sanction violations? No.
Do the Supervisory Board and Executive Board see the risk that the customers will not adopt a cloud strategy to the extent anymore because it is now known that U.S. authorities, governmental and non-governmental ones might do so as well, are able to control or check the network used by SAP and the respective cloud services? The answer is no. The next question on the Supervisory Board will then be answered by Friederike Rotsch, and I will be able to catch some breath again.
On item number six of the agenda, by-elections of the Supervisory Board.
The question is as follows, what is decisive for the successful work in the supervisory board is not only the knowhow and the competence, but also the question of whether the candidates can contribute their knowhow also effectively in their respective tasks, thus representing the values which SAP stands for, and thus also securing integrity of the company. Can you explain to us which special knowhow and capabilities the supervisory board has lost with the departure of Ms. Greene and Mr. Ala-Pietilä, who has been a long-term member of the supervisory board, and also regarding the contents of the change of the articles of association have to be replaced?
Ms. Diane Greene contributed expertise in software and cloud technology, for example, from her experience with VMware and her work for Google. Pekka Ala-Pietilä supported us in many years of service because of his leading position at Nokia and his function in other bodies of companies, some of them public. He could give important impulses with his expertise. As a longstanding member of the supervisory board of SAP SE, he knew SAP and our business very well. Of course, you cannot replace a member of the supervisory board one to one. We believe that the two candidates who stand for election today have excellent technological and entrepreneurial expertise to replace that of Ms. Greene and Mr. Ala-Pietilä.
With Qi Lu, we could win a software expert and as an IT specialist with a degree with a long career in famous companies like Yahoo, Microsoft, and Baidu in software in the U.S. and China. Rouven Westphal, who brings in deep knowledge of SAP business model, and he also has experience in starting up a technology company and can contribute that. Under item eight of the agenda, we are proposing a change to the articles. If your question refers to that, let's say that the purpose of the company is expanded to include telecommunications activities. This does not mean that the field of activities of the company becomes larger and that the supervisory board will have to have specific telecommunications expertise in the future.
Rather, the change of the wording is due to the fact that we want to include the cloud area better because many of our cloud products have telecommunications functionality and expertise in the area of cloud technology is already there in our Supervisory Board. Next question. Can the Supervisory Board give an example how Dr. Qi Lu could already bring in his ample experience in the U.S. and Chinese software industry since he was appointed? Yes, Dr. Qi Lu has been member of the Supervisory Board since December, and since the beginning of this year, he's been member of the China Strategy Committee of the Supervisory Board, and here he's been able to bring in his excellent knowledge of the Chinese software industry and the Chinese market, and he could give us important information and expertise regarding the China strategy of SAP.
How many of the startups Mr. Westphal founded are SAP partners today, or were acquired by SAP, or are supported by Sapphire Ventures? The startups founded by Mr. Westphal, none of them was taken over by SAP. None of them is supported by Sapphire Ventures, none of them has the status of an SAP partner. Next question: How do you explain where executives working more than 40 hours per week surely take the time to effectively monitor or supervise a dynamic company such as SAP? Even if the requirement of a mandate on the supervisory board are becoming more and more demanding, being member of a supervisory board is still envisaged by the lawmakers as a side activity or auxiliary activities. There is no reason why a person should not have that task or that function in addition to a main job.
It's, of course, always a matter of efficiency and individual workload capacity, and usually, people in management positions can handle high work volumes and organize themselves well. We can see this when we look at the members of the supervisory board of SAP, who also have executive functions with their employers. Because they are personally, we can make very high demands on them, and they can contribute very efficiently their abilities to the supervisory board activities of SAP. Another question is that the supervisory board has checked that the candidates have enough time for the office and based on its experience and looking at the increasing demands and requirements for the coming years. Please comment?
According to the rules of procedure, there are four regular meetings per year. The members also participate in meetings of the different committees of which they're members, and they also attend the annual general meeting of shareholders of SAP SE. Depending on the situation, there can be extraordinary meetings of the supervisory board or its committees. For new members of the supervisory board, depending on where they're active or what their activities focus on, and depending on their membership on the committees, there might be additional time required for individual onboarding and skill measures. It is difficult to forecast an exact amount of time required.
This depends on the memberships on the committees, and it depends on to what extent there will be extraordinary meetings of the supervisory board, which in turn depends on the business performance or business development or individual business transactions which require approval or discussion by the supervisory board. Please understand that at the moment, we are unable to give any exact information how much time members will require for their future work on the supervisory board. Does the supervisory board have any documentation or proof that the candidates are allowed enough time by their employers for their offices? Answer. There is no requirement to present such evidence, but of course, the supervisory board takes into consideration the ability of a candidate to fulfill their office on the supervisory board, and we make sure that they have enough time if this is necessary.
Of course, the supervisory board meetings are also held virtually. How does this work when you have different time zones with a supervisory board with members in America, Europe, and the Far East? Answer. You are quite right. The coordination of virtual meeting times is a challenge if the members are at different geographical locations, and they work in different time zones. This requires a high degree of flexibility of the members of the supervisory board, and especially in the current time, where we're still navigating through the corona crisis, that some of the supervisory board members need to attend the supervisory board meeting at a very early or very late time of the day. At this point, I would like to thank the colleagues for being prepared to do so. I'll hand over to Christian Klein for further questions.
Yes, thank you, Friederike.
Have there been connections from financial service to the insolvent company Wirecard, and what opportunities and risks arise through the bankruptcy of that company? The answer is that the Wirecard AG was no SAP customer. It is no SAP customer, and by the way, at the time, it was the only DAX 30 listed company that was not using SAP software. From our point of view, there are no risks that arise from the case. On the contrary, we believe that SAP solutions contribute largely to transparency of companies, and that facilitates supervising and monitoring and auditing processes. Moving on to the next question, how do you see the further development of the U.S.-China trade conflicts generally and specifically with regard to the development of the business of SAP SE? SAP advocates fair, transparent, and open trade and global competition.
We regret the trade conflict, which continues to exist, but there is no immediate negative effect on the world economy or our business. Are there comparable competitor products to SAP in China or from China, and how has their market share changed compared with SAP products? There are a number of Chinese ERP companies, for example, Yonyou and Kingdee. Yonyou is a partner, and it is a market leader in the Chinese ERP market. According to industry analysts, Chinese companies have been able to expand their market share in the past decade. This is also true for SAP, although to a lesser degree. We have been able to increase our market share. In international competition, Chinese ERP vendors play no sizable role. For the financial part of the question, I will hand over to Luka.
The next question has to do with financing alternatives.
The European Central Bank is currently buying bonds of publicly listed companies. To what extent has SAP used this funding option, and how does this option compare with other funding options? Is SAP planning in the next months or years to issue further bonds, knowing that the European Central Bank will buy them? It's true that through the engagement of Deutsche Bundesbank, the ECB has participated in such emission programs, for example, as part of the PEPP program, the Pandemic Emergency Purchase Programme 2020, which helps, obviously, it also influences the price of bonds positively. In the case of larger M&A, external funding is required, but only then. Otherwise, our investments are funded from our own cash flow, at the moment, we are not planning any further emissions.
Another number of questions where we have received similar questions also from Mr. Gabler and another shareholder, so this is a block answer to all of them. How high is the cost of a virtual AGM compared with a presence AGM? The cost of a physical AGM in 2019 was EUR 2.4 million. A virtual AGM in 2020 was about EUR 1 million lower, and for 2021, we expect the figure to be similar as last year. Will SAP try to enable hybrid AGMs in the future so that you can participate online in the future too? The different experience of companies and shareholders with the format of a virtual AGM this year and last year have resulted in intense discussions about the future of AGMs in general.
This concerns the question, for example, whether individual elements of individual AGMs or a real interactive online AGM could be integrated into the concept of a classic AGM, a physical AGM. Now, this political discussion is ongoing. We are following that discussion, but we don't want to make any statements here. We believe and, to be honest, we're looking forward to having another regular AGM in the SAP Arena in Mannheim, a physical AGM. As in the years before the pandemic, we will of course stream the AGM live on the internet. We think that conventional AGM could be combined with digital elements, for example, electronic transmission of proxies and voting by correspondence. What speaks against such a hybrid form of AGM?
The answer, an AGM is an opportunity to present the current situation of the company, but also invites an open exchange of opinions with shareholders, which is very important to the executive and for the supervisory boards of SAP. I can speak for both of them here. We think that the classic format of an AGM is better suited than a purely virtual form, because physical presence of the shareholders does make for a more lively exchange. Individual elements of a virtual AGM, like the possibility to submit votes by electronic means or to appoint proxies, could be useful enhancements. Other aspects, for example, asking questions live, however, offers very little value adding for shareholders. On the other hand, they require a lot of organizational input. The same goes for combining a physical with a real online AGM with interactive elements.
For example, a live chat with shareholders during the AGM. In addition to that, we see the risk that such interactive elements will result in legal uncertainties for companies. The next number of questions from this shareholder will be answered by Thomas Saueressig.
Thank you, Luka. How often was SAP SE the target of cyber attacks in the past 12 months? As a global multinational software company, which is active in nearly all business areas today, SAP is confronted with many cyber related incidents and activities. In a digital world, these have become something normal. On average, SAP registers 31 million attempts to get access to our global network or to take advantage of it, and 2.3 million of them are phishing attacks.
The security teams of SAP work every day to recognize such hacks and to fend off attacks. They're always looking for potential threats and how they can be combated. Next question. What do you know about where these attacks come from? The different types of attack are manifold. It starts with a simple malware which tries to get access to the system. There are phishing campaigns that tries to get login data and financially motivated or cross-border cybercrime. Since these attacks are anonymous, it's difficult to say where exactly they come from. Our cyber intelligence team is working successfully with partners to identify threats to SAP and its customers and to combat threats. The next question is, have you ever paid, for example, Bitcoins for ransom as a result of a ransomware attack? We do not give any information about this for security reasons.
How high are the investments to fend off cyber attacks? A three-digit million amount into the modernization and enhancing of the cyber capabilities. SAP is also investing continuously into the quality of our defense systems. We use modern threat analysis processes to analyze potential weaknesses. How satisfied are you regarding collaboration with investigating authorities? Of course, we're working closely with partners from the public sector, the intelligence services, and the prosecution services all over the world to get relevant and early information about threats, to investigate together, and also to identify the actors. So far, this collaboration has gone very well. Another question. In which business areas did you hold patents in the past 12 months and the years before? Where did you apply for new patents?
On the 31st of December 2020, SAP held a total of 10,931 valid patents, and 897 were granted in the year 2020. 12% of the patents are in the area of analytics, 21% of the patents fell into the area of business applications, and 67% of the patents were on technology. Currently, 1,900 patents are still pending. How important is protecting IP in the strategy of SAP? Of course, we always try to protect intellectual property actively, and our innovations serve to strengthen our market position as a leading vendor of corporate software and services. That takes care of the questions of our shareholder. With that, I hand back to Friederike.
Thank you, Thomas. The next questions refer to the share of women. First question, composition of the Supervisory Board. The Stock Corporation Act sees the 30% ratio as a minimum ratio. The Appointments to Federal Bodies Act foresees a ratio of 50% for the appointments to federal bodies. Will you follow this act and increase the ratio until you reach 50% share and maintain that? Well, today the Supervisory Board of SAP as of today has a share of 44.4% women. Why is there a drop compared to 2019? 2019, the share was 50%. Be that as it may, the SAP is taking the lead when it comes to the composition of the Supervisory Board because you exceed the minimum ratio of 30%, so you are a role model for other companies. Now the first question.
This Federal Act only applies to the appointment of representatives of the German federal state to federal bodies and not to private companies. The SAP ratio of the minimum share of 30%, either men or women. Since it's only a minimum ratio, it's not excluded that the share of women exceeds 30%, and that is the case, because we currently exceed the minimum of 30% because we have a share of 44.4%. The second answer, it's true that since the 2019 AGM, the share in women was at 50% until December 2020. With the resignation of Ms. Greene from the Supervisory Board and the appointment of Dr. Lu as her successor in December 2020, the share of women dropped to 44.4%. With that, however, we still exceed the minimum share of at least 30%, and quite considerably so.
Even after the election of Dr. Lu by today's AGM, we still comply with the requirements. A question as regards the setup of the Executive Board. We welcome that you generally follow the recommendations of the German Corporate Governance Code, that you consider diversity and inclusion, and particularly consider the share of women. The average share of women in German DAX companies is still below 15%. At SAP, currently, the women share in the Executive Board is under 30%, five men and two women in the Executive Board, a considerable increase compared to 2018, back then, 22.2%. What do you do to maintain this extraordinary situation? The Supervisory Board has set a target figure of at least two women in the Executive Board. That was set to be achieved by the 13th of June 2020.
In line with this objective, we have two women right now amongst the seven board members, and we aim to maintain this share to also achieve the target set down by the Supervisory Board. Now I'd like to hand over to Sabine .
The shareholder had some detailed questions regarding the women's share in the company. Setup of women at the executive level. With a share of 27.5% in 2020, the women's share, you're close to the 30% you set ourselves for 2020. It's positive to see this, and we are happy about that, and we are happy that you follow the target set by the EDGE organization. Now the question, which measures have you taken to initiate this target in addition to the programs Women's Professional Growth, HeyMama, SAP Women Forward, and SAP Women in Tech? Now the answer.
In the past years, we've been able to consistently improve our figures, we're happy about that. Thus are getting closer to our 30% objective. We have made major progress here. We still focus on more visibility of our female managers, and we offer a maximum of flexible, adapted working models and HR process without discriminations. Women get an overview on all open management expert positions in critical tech areas via virtual job forum and a direct access to our hiring managers to increase visibility. Rules such as diverse interview panels help to overcome structural disadvantages. In addition, in all regions, we have introduced tailored measures to bring role models and overcome gender stereotypes. All regions focus initiatives such as the equal share of paid work and care work amongst all genders. The share of female employees rests at 34%.
Why don't you raise your figure amongst female executives and have it higher than 30%? Well, we looked at the objectives and tried to become more ambitious. That is why for 2030, we have the objectives of gender parity. That means that the share of female employees in general, as well as the share of female managers, is to reach 50% by 2030. With the so-called early talents, the hiring target even now is at 50%. That's the target value, 50%. Another question. Do you have specific targets to hire women for management positions and internal promotions? Well, especially in those areas where women are underrepresented, we focus on hiring female candidates. The targets vary depending on the board region and the regions and also the regional female hiring potential. Accordingly, they vary. Fourth question, disclosing the female management levels.
The term women in management position refers to the share of female executives amongst the total number of managers. The SAP make the following distinctions: managers, manager managing teams. That's managers heading a team with at least one person. Managers managing managers. That covers managers who manage other managers. Then third, Executive Board members. Question, how do you distinguish between the mid and the top management? Well, our answer in our reporting, we decide or distinguish between manager managing managers and manager managing teams. Another distinction or differentiation within MMM is something we don't do. The share of women amongst all MMM positions was 23.5% in 2020. What's the percentage share between team managers with at least one staff and MMT without another team? Well, as a rule, an MMT always manages at least one additional person.
If this position is not occupied currently, that's only a temporary situation and is not reported. The female share of all MMT positions in 2020 was 29%. How do you explain that the share of women in the middle and upper management with 23.5% is considerably smaller than amongst the team managers with 29%? What's positive here is that the share of women with management responsibility increased from 2019 to 2020 by one percentage point. One, our target is to fill our talent pipeline successively bottom-up with female talents and to further develop our female talents. That's in line with our hiring target of early talents of 50% for women. All our measures focus on promote female talents along the career ladder, and that is why we come up with this 29% share of women in MMT roles and 23.5% in MMM roles. Fifth question, incentives for equal participation.
The implementation for the act of equal participation and the development of female talents is an executive task. How do you guarantee that your mainly male executives take decisions free of discrimination? Our entire human resources team, as well as our diversity responsibilities in the respective areas and regions, are in close contact with the executives and inform and monitor to the best of their knowledge in their regional specificities. We focus the attention of our managers in executive calls at all hands. The global campaign, Activating Men for Parity, focus tremendously on conveying knowledge from the business itself. Another question, what incentives do you have to achieve defined women ratio 30% by 2020? The answer here, since the beginning of this year, for all board areas, we have set so-called people goals.
One share of this people goal is also the increase of the share of women in the company in general, and also the share of women in leading positions. These set down goals are part and parcel of the performance management, and thus are an incentive to achieve these corporate goals. Are there individual target agreements in that context? In the context of performance management, these targets are breaking down to the individual board areas. The managers contribute to the corporate goals with a view to diversity too. Question, how do you convince decision-makers to work towards this goal and to overcome traditional, sometimes subconscious ways of behavior? Across all board members, we observe a strong proactive attitude to actively work on that and to further educate themselves. Our entire HR team and the diversity responsibility are in close context with all decision-makers.
Measures such as the Inclusive Leadership Challenge convey knowledge, transport knowledge, and motivate also to contribute to achieving these targets. Next question. Engineers, women in tech within SAP. Well, SAP is strong in software development to handle business processes, the accounting, controlling, sales, procurement, production, warehousing, and HR. That is why you have to hire engineers as one of the most demanded group of people. We welcome your initiative, SAP Women in Tech. How many engineers do you have in total? How many female engineers? How many male engineers? How many engineers work in top management? How many female and how many male engineers? How many engineers work in middle management? How many female and how many male engineers? How many engineers work as team managers? How many male, how many female? The answers now.
In Germany, we have a share of university graduates of more than 80%. Technical courses are most relevant and are still the focus. Since we offer solutions in different businesses, we rely on the know-how of our employees in different sectors. We don't report in detailed fashion which university degrees have been attended. Generally, we can say that more than 50% of employees have a degree in engineering or in computer science. This also applies to career starters we hired in 2020. The share of women is in proportion to the overall employee structure. Now, university graduates. Seventh question, university graduates are the talent pool of a company. How many engineers, women in tech, have you hired directly from the university as career starters? How many male, how many female engineers? In the most relevant board areas, we've hired more than 1,500 early talents.
Just under 1/3 were women. Amongst the new hires of new talents, you have a share of 35.5% women. Do you have any target regarding the share of women you want to recruit amongst the young talents? Why did this share drop from 37.5% in 2019 to 35.5% in 2020? Our answer is, our objective is 50% women when it comes to hiring early talents. This drop, I guess, is due to the pandemic related external hires, but also since we focus on critical areas and also the changes in applications due to the pandemic. Of course, we are going to monitor that in detail over the next years. We'll stick to our objective, 50%. The next questions also refer to our employees. John Steffens asks, how does SAP explain why they offer an additional holiday to all employees?
The answer is, the physical and mental well-being of our employees is dear to our heart and is central for today's and future business success of SAP. Against this backdrop, SAP invests into the health and well-being of the employees, has been doing this for a long time, and is leading in terms of corporate health management. As SAP, we recognize absolutely that 2020 and 2021 have posed major challenges to our employees, and that these challenges continue to exist. That SAP can address their physical health, SAP Board decided, in addition to the global Are You Okay campaign for more physical health, to offer the mental health day on the 27th of April, 2021. The same free day was offered to all.
This principle was chosen so that the effect of the global mental health day can be felt at the following day, because no tasks, no mails will have been received during the 27th. It's important to make clear one thing, it's not a holiday, because that could have been taken any time and would have increased, of course, our provisions in case it be transferred to the next business year. Since many employees have also taken additional holiday to cover the bridging day, we've been able to reduce our holiday provisions, which wasn't our primary goal, but a positive side effect. SAP hopes with the mental health day and the continuous Are You Okay campaign to contribute to the mental health and the reduction of the productive losses due to health issues with regard to sick days, because they lead to directly high costs.
In our employee surveys, we found higher stress levels in 2020 with one third of employees. This shows that we have to take proactive action to avoid an overload and preserve the health of our employees. The last question from me, Mr. Steffens also asked, how much do the 102,430 staff multiplied with the daily average cost of SAP? Well, let's modify the answer. Total HR expense in the business 2020 was EUR 13.4 billion. If we assume the average number of FTEs, 101,476, the personal expense per staff and year is EUR 132,000. That includes the expenses for share-based shares.
Thank you, Sabine. The first question for me to answer is the following. Why are companies such as Salesforce able to operate much more efficiency with less employees? That is something I definitely have to correct, Mr. Steffens. I dare say that the SAP employees are significantly more efficient than the competitor you mentioned. It depends on the criterion that you apply. For me, these are profitability KPIs, such as the IFRS operating income. If you compare this for the two companies, and if you then break it down onto the individual employees, then the employees of SAP generate an IFRS operating income, which is nine times higher than that of the competitor. You would get the same result if you look at the gross margin or the operating margin. For that reason, I cannot confirm the observation which your question is based upon.
Now comes a question from John Steffens on compensation of the Executive Board. That's something for Friederike Rotsch to answer.
To what extent does the Executive Board contribute to shouldering the cost of the crisis? What was the justification of the Supervisory Board of Walldorf SAP SE to approve an additional compensation for several Executive Board members at its meeting in February? The compensation system approved by the shareholders at the AGM 2020 is the basis for all compensation decisions of the Supervisory Board. For the year 2020, no target adjustments were applied during the year. No short-term incentive was paid out for 2020 because the targets and lower thresholds that had been set early on were not reached due to the COVID-19 crisis. The long-term incentive is paid out only after four years. The amount of the LTI is influenced by performance criteria and the share price development.
As of the 31st of December 2020, the ratio of the target parameter for the LTI tranches versus the currently calculated theoretical payout amounts was at 45.5%. After thorough deliberation, the Supervisory Board decided to grant an additional compensation to the Executive Board members for last year as an exceptional measure. Now, the Supervisory Board decided to act so because the Executive Board members ensured in these extraordinary times that the company remains on a profitable and proper track, which aims at the long-term sustainable success. Specifically, the Executive Board members responded immediately to the dynamics and the situation, and amongst others, ensured through virtual distribution and remote implementations, ensured the safety and security of employees, partners, and customers while maintaining and continuing business operations.
A pandemic crisis staff was established in order to take the needs and demands of the employees into account, we have just heard about some of them, and to make sure that they are all well. Taking the needs and demands of customers, employees into account also manifested itself in an increase of the customer Net Promoter Score by 10 points and in an increase of the Employee Engagement Index to a new record level. Within this fully virtual setting, the Executive Board even increased the speed of transformation of SAP. The Executive Board did not introduce any short-time working. It did not consider any terminations of contracts, and it did not use any governmental aid packages. It ensured profitability.
It generated growth in cloud and software revenues, and if applicable, also implemented cost savings, which altogether resulted in increase of the operating profit of SAP and a free cash flow at a record level of EUR 6 billion. In 2020, SAP exceeded all of the adjusted revenue targets for 2020 and reached even the upper end of its guidance for the operating income. This, in spite of the ongoing COVID-19 crisis. Except for the cloud revenues, SAP in final analysis reached all of its forecasts announced in 2020. In 2020, SAP paid out a higher dividend and also completed a share buyback program to the amount of EUR 1.5 billion. For this reason, the supervisory board considers the additional compensation a positive signal for current and future executive board members, and consider this also possibility to strengthen their commitment to SAP and to secure the long-term success of the company.
This brings me to the next question, and for this, I hand back to Luka again.
Thank you. This takes us to the exciting area of taxes and sports sponsoring. They're not directly related, but nevertheless, I will answer both of them. Taxes first. How much corporate tax did SAP SE pay in 2020? Now the answer is as follows. In Germany, SAP SE has an unlimited tax liability and therefore pays corporate tax and a solidarity surcharge in Germany, and also respective trade tax in some municipalities. This can be tax advances for the current year and/or tax arrears for the previous years. Furthermore, SAP SE has a limited tax liability in various other countries, and with its respective revenues, is subject to the respective withholding tax deduction.
This also shows that the topic of taxes is very multifaceted, and that individual statements on individual tax items in certain taxable periods is not really meaningful. The current tax expenses, which were determined in accordance with the legal stipulations, amounts to EUR 770 million for SAP SE in fiscal year 2020. This includes a balance of all cash inflows and outflows which are cash effective in the past fiscal year and/or in future ones. Information on income tax paid can also be found on pages 98 and 146 of the integrated report 2020. Now questions by two shareholders about the SAP sports sponsoring activities. How high were the expenditures for sports sponsoring in the fiscal year, and how did they distribute onto the individual sports? How long are the contractual obligations?
In the year 2020, total expenditures amounted to about EUR 80 million, and the main items were soccer, that is European football, EUR 13 million, hockey, EUR 11 million, basketball, EUR 9 million, sports arenas, also EUR 9 million. Then next we have equestrian sports, and then small amounts for various other sports, and I think I do not need to read out all of these small amounts to you. We've got several active contracts, the term of which varies between one to 10 years, and for obvious reasons, especially confidentiality towards our contractual partners, we cannot disclose any further details on these contracts. How high are the expenditures for TSG 1899 Hoffenheim and FC Bayern München? The sponsoring expenditures for soccer in the year 2020, as I said, amounted to approximately EUR 13 million.
This also includes our sponsoring expenses for TSG Hoffenheim and FC Bayern München, the rest, as before, is subject to confidentiality. Who decides to which extent sports are supported or sponsored? Well, there is a dedicated team which develops the respective proposals, in the final analysis, it is the Executive Board which decides on every single measure. Last but not least, what's the benefit of these sponsoring activities, or how are their impacts onto corporate success measured? Now, as with all marketing activities, it is very difficult to measure the specific success of individual measures and to quantify it. However, sponsoring is an important element of our overall marketing strategy, amongst others in the areas of product marketing and events, in branding or brand marketing, also when it comes to positioning SAP as an attractive employer and so on.
Of course, all of these activities are afterwards analyzed, for example, regarding the reach of the respective measures, how many additional visits were thus generated for our websites, and so on and so forth. It's obvious that the sponsoring market is still a highly attractive one, which also manifests itself in some recent agreements our competitors concluded. In some cases, these were even much smaller companies which dedicated a very high volume to these activities. Our shareholder, Norbert Loos, had a question, item 5 of the agenda. What are the expenditures for the group's auditor? Now, we disclosed this in the consolidated notes in Annex G7. For the year 2020, the overall fee amounted to EUR 14 million, EUR 12 million of which were audit fees and EUR 2 million were so-called audit related fees. Our shareholder, Istvan Szalai, had the following questions.
Number one, which targets did SAP set itself in terms of carbon neutrality, and to what extent is this also promoted by the Executive Board? We already stated that by the end of the year 2023, we want to be carbon neutral in our own operations, which is two years earlier than what we had initially aimed for. For SAP, this applies to all direct, indirect emissions and also to selected emissions from the supply chain, for example, those which are caused by business trips, by airplane, or by rental cars, or by data centers of third-party vendors. The SAP Executive Board supports this goal as one common goal. Each board member is called upon to reduce the CO2 emissions in their respective divisions. The annual CO2 reduction targets, as we've already indicated to you, are part of the criteria for the short-term Executive Board compensation.
Next question: Are there any takeover offers of foreign investors for SAP? No, that's not the case. This brings us to further questions by Michael Ruf. First question. Now, our SAP actually should be at the forefront of IT management of shareholders and their invitations to the AGM. Why did I get three invitations to the AGM by mail? Wouldn't that be possible with one shareholder account, which includes all of the shareholders of the shareholder, and which is also the basis for the electronic invitation to the AGM for the shares registered there? This time I had to log on three times and then vote three times. Well, it can't be any more cumbersome. Is SAP going to change this? Next question, it seems that SAP has retained the DZ Bank AG to handle invitations and dispatch the voting cards.
Is DZ Bank doing this really on themselves? The sender of the voting cards is Deutsche Wertpapier Service Bank AG, which is already the second intermediary, and the internet portal is then operated by Computershare Deutschland GmbH & Co. KG, which is probably the only professional service provider in this regard. Next question. What are the fees or commissions which the banks, the DZ Bank and DWS Bank receives? Can't this be handled more easily out of one stop? Certainly then also the post dispatch time could be reduced. Then we will get the invitations on May 2nd, which is only three days before closing. I fully understand your question, and this is really a hot topic, but you've got to realize that it is the share class which determines this procedure.
SAP shares are not registered shares, but bearer shares, thus, we do not personally know the SAP shareholders, for that reason, we can only reach out to them via the custodian bank. About 50% of the DAX companies have issued registered shares, 50% have issued bearer shares such as SAP. Your custodian bank is in charge of sending out the invitation and the registration documents. It is your custodian bank which decides whether it offers you the possibility of an electronic or analog registration, at that time you receive the documents. If you then have several share portfolios or even portfolios with several institutes, it is normal that the invitation and voting cards are sent to you several times because with bearer shares, there is no central share register.
SAP reviews the share class at regular intervals and has several times already considered whether a change would result in improvements in the process or in transparency. However, changing the share class would require a resolution by the AGM and would also trigger a long-term project. Now, the chain of intermediaries you noted in your second question is also due to the share class. The custodian banks charge SAP for sending out the invitations and the registration documents. No commissions are paid, and the cost volume for dispatch of the documents in the year 2020 amounted to EUR 500,000. However, by switching to electronic invitations and by not printing any documents anymore, we this year expect the cost for the dispatch of the invitations to be significantly lower, and Friederike will now take the next question.
These are several questions about the formal approval of the acts of this Executive Board and Supervisory Board. My question is, why did the Supervisory Board not decide on the individual formal approval of the acts of the Executive Board members and Supervisory Board members, which is customary at various other German listed companies and even on an international scale. This collective approval approach rather fits with the new political collective socialism and not with a modern democratic service society. If you have looked at the individual targets in the compensation system and the respective compensation of the Executive Board members, then of course, every shareholder also would like to assess for themselves how they consider the performance of the individual Executive Board members and also Supervisory Board members.
Mr. Chairman, I call upon you to have individual approval of the acts of the persons under items two and three of the agenda. If you refuse to do so today, then think about this for the future and give us shareholders the possibility to individually assess the performance of the executive and supervisory board members. No shareholder does have to do so, but some would like to do that. Now, we received a question by Mr. Ruf why under items two and three, we have a collective approval of the acts of management. Probably the question relates rather to items three and four, whereas other companies decided to have individual ratification of the acts. Mr. Ruf called upon us also to switch to individual ratification. Let me answer as follows. According to the Stock Corporation Act, the standard is collective ratification, whereas individual ratification is the exemption.
In our view, for that reason, apart from SAP, numerous other well-known companies also adopt collective ratification. Individual ratification is recommended especially in those areas where individual executive board members and supervisory board members are exposed in a particular manner. However, we cannot see this for our company, neither for the past year nor otherwise. We still believe that collective ratification is still appropriate and also want to retain this mode for today, especially as many shareholders have already cast their vote before today's virtual AGM in this manner. Of course, for next year, we will also consider whether there are any reasons to have the individual ratification of the acts of management of the supervisory and executive board members. Thus, Mr. Ruf's questions have been answered, and we now continue with the questions of another shareholder.
The question is as follows: "Here, I'd like to draw your attention to the following mistake. The section on motions election proposals by shareholders reads as follows: In accordance with the statutory provisions, all motions and election proposals relating to the items on the above agenda received by us in due form by April 27, 2021, 24-hour CEST, will be made available and marked with a letter. If you wish to vote on such shareholder motions election proposals, please cast your vote below under the respective motion election proposal or give corresponding instructions in each case in the event that a vote is taken. If you do not tick any of the boxes, you will be deemed to have abstained. Is that correct?" That was the question. Here comes the answer. This question relates to a note on our shareholder portal.
If shareholders there select the option exercise voting rights by postal vote, then an input screen appears with the individual agenda items and the option to click yes, no, or abstain behind each individual agenda item. Below this is the note quoted by the shareholder to voting on motions and election proposals by shareholders. This note is correct. It means that the electronic voting option in the shareholder portal would have been supplemented by a corresponding voting item in the event of a counter motion or election proposal submitted properly. However, we did not receive any counter motions or election proposals from shareholders. For that reason, it was not necessary to supplement the input options for electronic voting accordingly. We continue with the next question, and I hand over to Christian.
Thank you, Friederike. The question is: After EU sanctions were imposed on China, Western fashion chains were boycotted. What if SAP got dragged into similar conflicts, and what plans exist to avoid damage? Answer: SAP always advocates human rights and fair sustainable trade. We will watch any possible touch points with our business and possible violations of our principles. The next shareholder has questions about the technology. Therefore, the answers will be given by Thomas Saueressig.
What's your strategy to map and process business processes with cryptocurrencies, and in which applications are you planning or have you implemented using blockchain technology? SAP has looked into blockchain technology and cryptocurrencies for some years, non-regulated currencies, just such as Bitcoins, as an example of a blockchain application, are not operational currencies. Some applications can, however, use cryptocurrencies.
Of course, we are monitoring the development. We're always ready to implement the corresponding functions in our applications if such currencies are introduced. We're using blockchain, for example, in digitalized supply chains. For example, SAP Information Collaboration Hub for Life Sciences maps real-time check of some pharmaceutical products via blockchain, and the SAP Logistics Business Network allows blockchain-based tracing along a complex supply chain and across company borders. Another technical question from the shareholder Szalai. What does SAP do to build up artificial intelligence, and can SAP alleviate the burden or facilitate automotive production? How much are you investing? SAP offers customers, partners, and the SAP development team a growing offering of so-called AI services around artificial intelligence through its SAP Business Technology Platform. We want to embed these functions into our standard business applications and provide specific services via interfaces for certain business contexts.
We are not generally competing with general AI services and AI platforms as are provided by hyperscalers. Our AI technologies are directed at SAP solutions and the business processes of our customers. For example, in the automotive industry, people use the information, the semantics of the data to cover artificial intelligence applications. Of course, SAP is investing in the development of such services along the whole development process, across the whole product portfolio. Artificial intelligence is an integral part of our product development. Another large question from a shareholder. What will SAP do in the not-too-distant future to bring its product quality in line with its price policy? We cannot accept a situation where the patches of SAP accounting software errors are delivered, and they result in wrong statements and tax reports. It's very embarrassing that these glitches are fixed later on by patches.
A brand product, which is not exactly cheap, should offer more quality. Last year, you answered to my question that you thought that the pricing policy of SAP is appropriate. Answer: With the accelerated move into the cloud, quality is becoming an even more important dimension in evaluating vendors of corporate software, and therefore successful quality management at SAP is important. We are constantly working on improving our product quality. This is reflected in the Net Promoter Score of our customers, which has increased by 10 points. We're also reacting swiftly to any legal or tax changes, and we've shown that especially in the pandemic period. For example, during the first 50 days of the pandemic, more than 80 legal changes were implemented.
It's true that in the case you're referring to, we did have to provide a correction, but it is a very complex subject because there are many legal changes, especially in payroll accounting, and often these have to be implemented at very short notice. Of course, we're prepared and happy to discuss this topic in detail with you. The payroll accounting is certainly one of SAP's products where most adaptations or changes are provided due to legal changes. As I said, many additional legal changes were caused by the COVID-19 situation, and all that had to be provided as part of the existing maintenance model. Let me assure you that quality is an absolute foundation of our business, and we are really focused on it. With that, I'll hand over to Sabine for further questions.
Thank you. First of all, hello.
There was a question about the share of people working in Germany. The answer is that at the end of last year, 31st of December 2020, the employees working in Germany were 22,944. Expressed in FTEs, in full-time employees, this was 22,182 or 21.7% of our entire payroll. There were questions about our pay structure. While I'm answering these questions, Mr. Gabler had the same question, so I'm responding to his question too. The question was, what is the pay structure outside the executive board, total pay, including all bonuses and LTI, number of persons in excess of EUR 120,000, EUR 250,000, EUR 50,000 and EUR 1 million annual salary. How many people in each case?
Based on the target pay on a full-time basis, including long-term incentive for 2021, the distribution outside the Executive Board is as follows: 27.2% of staff earn more than EUR 120,000, 4.5% of employees earn more than EUR 250,000, 0.4% of staff earn more than EUR 500,000, and 0.1% of our employees earn more than EUR 1 million. The second question was how many people in Germany have a gross annual salary of more than EUR 120,000, EUR 250,000 and EUR 500,000, and how have these rates developed compared with last year? The salary structure outside the Board based on target pay on a full-time basis, including long-term incentive, is distributed as follows: 32% more than EUR 120,000, 1.4% more than EUR 250,000, 0.2% of staff more than EUR 500,000, 0.03% more than EUR 1 million.
The year before, 30% of staff more than EUR 120,000, 1.3%, slight reduction here, less than this year, more than EUR 250,000, 0.2% of staff members more than EUR 500,000, 0.03% of our employees earn more than EUR 1 million. This takes care of this question, and I'll hand back to Luka.
Thank you, Sabine. Now we come to a very long catalog of questions from one shareholder, Matthias Gabler. The total were 85 questions, some of them have already been answered before. Let's take care of the delta then. The questions left. How long will the virtual AGM probably take? We did have to take a little more time for the questions because more than last year came in this year. How long it is going to take is of course guess work.
Since it's now a little after 3:00 in Germany, I hope that we will maybe finish by 4:00. No guarantees. Secondly, how do you sort the questions? By shareholders, for example? Answer, mainly by shareholders, but also sorted according to topics. How many participants at the beginning of the virtual AGM, at the end of the CEO's speech, at the time of answering the questions, and as a maximum? At the beginning of the virtual AGM, 1,176. At the end of the CEO address, 3,514. Currently we have 4,949 participants online, and this is also the maximum. At what time did you receive the last questions? This was Monday, May the 10th, 19:30. How many questions were submitted outside the shareholder portal? None, because all of them were submitted through the portal. How much time did it take to answer the questions in previous years?
The time to answer the questions was from opening the shareholder portal on the 21st of April up until May the 12th. How many internal and external staff members were working on this? About 20 colleagues processed these questions at different intensities. We did not trace the time exactly. All answers came from internal sources. There was no external support for the 2020 AGM. It was the same. The question, what external lawyers from what firms were involved 2021 and 2020? The answer, Klaus von der Linden of Linklaters Düsseldorf helped us regarding legal questions in the context of the AGM of SAP SE. Prior to this year's AGM, we did coordinate and discuss the answers to some of the shareholder questions with him. Will you stream or will you make the full AGM on the internet like Bayer AG not just until the CEO address?
We will stream the whole meeting, the recording will go up to the question and answers. Why was there no opportunity to ask questions, as is the case, for example, with Beiersdorf AG or Deutsche Bank? Answer. We are aware that the rights of shareholders during a virtual AGM, especially the right to contribute and ask questions, are limited. In order to allow more interaction among shareholders, we've decided to give the possibility to shareholders to submit video messages through the shareholder portal where they can make their statements. The video messages that we received from shareholders were made available on the shareholder portal. All registered shareholders could watch them. This is more than the law requires. However, we did not provide the possibility to shareholders to ask add-on or follow-up questions during the virtual AGM.
The law provides that questions can be asked up until one day before the AGM, so we did not deem an additional possibility to submit additional questions unnecessary. On the other hand, this requires a lot of organizational input, and answering many questions during the virtual AGM would have required a similarly large number of staff to be busy in a physical back office, as would be the case with a physical AGM. Under the current pandemic conditions, where most staff of SAP is working from home, this wouldn't have been possible. On the other hand, in a virtual back office, the coordination of answering questions among staff members in a very short time during a live event would have been very difficult. These were reasons that made us decide to go for this balanced approach, as I think.
Did you have problems preparing or processing jobs or projects because of Corona? No, we did not have any additional or any significant difficulties or additional burdens. We responded quickly to the Corona pandemic, we focused, of course, on customers, staff, and the company, we had a virtual sales and remote implementation strategy so that many of our staff was working from home and to give customers good service. With that, I'll hand over to Sabine again.
Mr. Gabler, you wanted to know, is there short time work at locations or have locations been closed temporarily? No, there is no short time working and no locations have been closed. Of course, like all others, there were certain measures because of the pandemic restricting access to individual buildings.
Since staff members can work from home or from another office building, this is not the same as closing a location temporarily, and it cannot be compared to that. The next question was, are you providing additional funds to top up the short time work pay? The answer is no. Are you providing extra money for higher income classes, or how is that organized? The answer was, we do not pay any extra money, so there is no prorating or there is no distribution. How did you act in other countries, and is there a similar strategy? Answer, SAP did not get any state support. Can we expect the staff number to be decreased as a result of the pandemic, and if so, where and how many? At the moment, we do not expect our payroll to be reduced as a result of a COVID pandemic.
How high was the fluctuation of the group in the current year and the previous year in Germany, in Europe, in Asia, and America, including South America? No surprise, the fluctuation went down a little bit. The figures are, that is people leaving the company. The rate was 1.1% in Germany in 2020 and 2019, 1.5%. In EMEA, it was 3.2%. In 2019, it was 4.5%. In APJ, that is Asia Pacific Japan, at 6.4% compared with 9.3% in 2019. In the Americas, North and Latin America, 5.3% compared with 7.6% the year before. That decrease is due to the COVID-19 situation and fewer people leaving. How has fluctuation developed in Germany in terms of voluntary leavers and also people leaving because they're pensioned? The voluntary leavers is 1.1% in Germany in the current year, compared with 1.2% in 2019.
The natural attrition of fluctuation because people are pensioned in 2020 was very low because of the restructuring program in 2019, where people had the option to participate in part-time retirement. The leavers due to age in full-time equivalents was 870 in 2020, 3.8%, compared with 168, 0.8% in 2019. With that, we continue with Luka and financial questions.
Thank you, Sabine. Taxes, again. How many taxes has the company, they're all internal or local corporate companies paid in Germany, how is this figure distributed according to the five biggest tax types? Well, in total, we've paid EUR 740 million. That includes reimbursements for previous years. Not included are deductions, which we've transferred to the finance authority. Here, VAT has the highest share, followed by corporate income tax plus the solidarity surcharge, trade tax, the employee share, the salary tax, and car tax. Due to the consolidation of the internal daughter companies, we can't specify the figures further. Another figure, what's the share of the employees in terms of tax, social, and pension contributions? Well, SAP has paid salary tax in the amount of EUR 572.5 million for SAP SE Germany, and for the other employees of SAP companies, EUR 206.9 million. This tax was paid by the employees.
The employee share in the social securities contribution was at EUR 280.2 million for SAP SE, and for the SAP group, EUR 68.6 million. What are profit and loss transfer agreements? Were the profits completely booked, or which part was left at the daughter companies? With all profit and loss transfer agreements, the complete profit was transferred. Next question. As far as applicable, for which companies did you have accept losses, what were the reasons for that, and what do we do to transfer the companies to the profit zones? Well, in the context of profit and loss transfer agreement, the company has accepted losses from SAP Erste Beteiligungs- und Vermögensverwaltungs GmbH, SAP Zweite Beteiligungs- und Vermögensverwaltungs GmbH, SAP Sechste Beteiligungs- und Vermögensverwaltungs GmbH, SAP Hosting Beteiligungs GmbH, OutlookSoft Deutschland GmbH. These companies, they are investment companies, basically, or where we have a share.
The losses are mainly due to operative expenses, which were not offset by revenues. We expect, however, that the companies will develop positively in the short to midterm and will generate profit over the next years. Next, do we expect problems with refinancing requirements? No. SAP has solid rating, a stable single A rating at S&P, and a stable A2 rating with Moody's, a strong free cash flow in 2020. We've proven that we're strong here, and we can definitely use the cash pool we have for any operative expenses, but also fulfill any financial liabilities. No cause for concerns. Next question. To what extent have you been able to adapt your cost due to the crisis? Well, last year, in particular, we saved, in the field of business trips, more than EUR 600 million versus budget.
In addition, we had savings because we temporarily closed SAP sites, and we had less expenditure on our car fleet. That led to lower repair and fuel costs. In addition, we have to underpin that the employees voluntarily contributed in forms of further savings, IT hardware, for instance, because they followed our request for a considerate order behavior. That was excellent, and as a board, we are really grateful. These and other effects meant that SAP, in total, had been able to save more than EUR 1 billion against the originally planned budget. Next question. Have you shortened or postponed investment? CapEx invest in fiscal 2020 are almost identical with the ones in previous year, EUR 860 million, against EUR 817 million in 2019. You have to consider, however, that despite the growth of SAP strategic orientation towards hyperscaler led to lower investment in IT hardware.
Due to the global pandemic, investment in fleet, end-user equipment, and office area were postponed. Next question. What financial losses do you expect due to the ongoing COVID crisis? Well, once again, in the field of our SAP Concur business software, we still expect in the rest of 2021 to have further drops in revenues, or at least no strong increase due to the lockdowns still exist. Apart from that, across the entire remainder of the portfolio, we see strong growth. Above all, when it comes to incoming payments, we don't expect any negative impacts. Did you use any corona support programs by the state? We did not. Due to the crisis, did you impact existing credit facilities? No. We complied with all the financial liabilities, reduced them according to plan.
For 2021, we don't have to pay back anything according to plan. With which bank do you have credit facilities and which conditions? Well, in addition to our revolving credit facility, RCF, in the amount of EUR 2.5 billion with our core banks. In 2020, we had additional bilateral credit lines in the amount of EUR 433 million. The SAP core banks include, among others, Deutsche Bank, JP Morgan, HSBC, BBVA, Societe Generale, and Citibank. The agreed conditions are competitive and are regularly monitored. The use of bilateral lines as well as our RCF were not required due to our liquidity. Have you paid negative interest? To what amount and what have you done to avoid those? Please give the names. We can avoid negative interest for the double-digit million investment we have. However, with the short-term investment, we have to pay negative investment.
We try to avoid and reduce those. To limit the exposure risk management is our strictest objective here. We follow a strict guideline that stipulates a minimum rating for the banks and also a maximum investment volume. In 2019 and 2020, we paid a single-digit million volume. Please let that our commercial paper financing also led to negative interest in our interest so that we have partly offset the negative interest. In addition, with our core banks, we also invest in the spot market fund of Morgan Stanley Investment Management and BlackRock. Some HR question. Back to Sabine.
Mr. Gabler, you asked how many people worked from home prior to the start of the pandemic. We always offered a high level of flexibility, so that is something we haven't measured so far. We have had a high level of flexibility.
How many people work from home right now in Germany? Considerably more than 90% of our employees are working from home right now. Do we live up to the regulations to allow for maximum work from home? We live up to the legislation because we offer an extreme level of flexibility. How many costs could you save after overcoming the COVID crisis if only 10% of the working hours would be worked from home? Even prior to the global pandemic, hybrid working model was part of the everyday life at SAP. Globally, at least 10% of employees work from home or remote on average. That is why we don't expect a direct savings if we talk about home office level of 10%. How many employee of the mother company, German companies, and foreign companies have suffered from Corona?
Were there any death cases and have you offered financial support to the remaining families? How many working days were lost due to quarantine? Were some areas not covered? Well, first of all, health and safety of our employee take first priority, in particular since the beginning of the COVID pandemic. We respect and protect the private sphere of our employee. That, of course, includes health data as well. We don't communicate any figures, like people with COVID or positive cases, even in particular because in many countries, the employees are not obliged to inform the employer. We have specific regulations when it comes to support for remaining families, surviving families. We don't distinguish between the type of illness that led to any death. Basically, all employees have been instructed to work from home as far as possible.
In addition, the employer does not know about the type of illness, so we can't provide you with any information regarding quarantine times. For infection protection reason, of course, we've issued access restriction for individual buildings. Since the employees could work from home or from other offices, this is not the shutdown of an operating site compared to a producing company. With that, I'd like to hand over to Christian Klein because there are more strategic questions.
Thank you, Sabine. Question, what is it the executive board and the advisory board want to do better in 2021? Well, as regards the executive board, we set ourselves ambitious targets for 2021. Our guidance 2021, well, has been covered several times during this AGM. We're quite confident that we will achieve these targets, thus laying a solid basis for achieving our midterm targets by 2021.
As regards to the supervisory board, I'd like to hand over to Friederike Rotsch.
Well, regards the task of the supervisory board, I covered that when I answered the Union Investment's question. In 2021, we want to continue our redesign of the supervisory board. Should the AGM approve Dr. Qi Lu and Dr. Rouven Westphal's nominations, we'll have two further independent members in the supervisory board, and also in the committees. The supervisory board will convene soon after the AGM to also modify the composition of the committees. Here, the strengthening of the independence of the committees will play a major role. Back to Christian.
Thank you, Friederike. Next question, apart from the COVID-19 crisis, what will be the major challenges for 2021? Well, as I've explained in my presentation, we see light at the end of the tunnel as regards the COVID-19.
I would no longer like to talk about risks, but more about opportunities and chances here. They are quite clearly the transformation of our core business into the cloud. Which specific software do you use for the Executive Board meetings and Supervisory Board meetings, and how to guarantee privacy and security so that important data cannot be transferred to external servers? For our board meetings, we use Microsoft Teams and Zoom, and for the exchange of the documents, our in-house application for the display of relevant finance, customer, and personnel data analysis. For the reports of finance figures, we use our SAP Digital Boardroom. The security and privacy is guaranteed by the use of the relevant security and encryption standards, as well as an additional identity check of all the participants. The conference solutions used are regularly checked to make sure that they comply with safety standards.
For the exchange of confidential documents, we use our own SAP solution. With this solution, all data are stored on servers of our own computer centers. Users only get access via multi-factor authentication. How many legal issues do you have right now with customers? SAP has hundreds of thousands of customers in more than 180 countries. Of course, it might happen that litigation arises linked to product service functionalities or software, even though we're always willing to conclude them swiftly. This can also include smaller non-court discussions in those countries where SAP is active. We don't have a comprehensive statistics. Our litigation team that works on global litigation teams, well, they only centrally handle the most important litigation typically. Right now, we have 10 open cases.
Next question, how many SAP launch projects at customers were not completed in time in 2020 and 2019, on budget and not in time? What about the problems? Are there any geographic or sector-related repetitive cases? Since the tremendous majority of SAP launches will be carried out by implementation partners, I can't give you a full answer. However, as regards our own consulting business, we've been able to maintain the high level of quality of previous years. Despite the pandemic-related transition to a virtual model, there were no observable quality problems. As you've heard, customer satisfaction has significantly improved.
For the next questions, I would like to hand over to Luka again.
Thanks, Christian. The next question is, which realistic risks do currently still exist, which might impact our share price? Basically, it's the risks which we have also already covered in the respective risk section in our Integrated Report 2020, which is mainly macroeconomic and industry-specific developments, but also internal risks in our company, such as fluctuations in order intake or revenues or profit and cash flow development outside of our expectations. Next question, what is the current forecast for sales and profit for the current fiscal year? Due to the strong development in the cloud new business, we have increased our outlook on April 13 for the full year 2021.
Here we assume the revenues from our software license business will continue to decline as more customers go for the subscription offering RISE with SAP. Furthermore, in this outlook, we also expect that the COVID-19 increases will gradually decrease due to global progress in vaccination, which means that global demand will further improve in the second half of the year. For fiscal year 2021, we now expect cloud revenues, non-IFRS currency adjusted in a range between EUR 9.2 billion and EUR 9.5 billion, which is equivalent to a currency adjusted growth rate of 14%-18%.
Cloud and software revenues, also non-IFRS currency adjusted in a range between EUR 23.4 billion and EUR 23.8 billion, which corresponds to a currency adjusted growth rate of 1%-2%. The operating income, non-IFRS currency adjusted in a range between EUR 7.8 billion and EUR 8.2 billion, which is equivalent to a currency adjusted decrease from -1% to -6%.
Last but not least, the share of better plannable revenues, defined as the total of cloud revenues and software support revenues, is to reach a share of about 75% of total revenues. Next question. What is the current level of non-operating capital at the company and the group as a whole? Only if applicable, how many pieces of art and similar assets, with what total value does the company and its German group companies possess, which undoubtedly must be non-operating. Our assets mainly include goodwill, intangible assets, tangible assets, mainly consisting of property and buildings, and our IT infrastructure, trade receivables, as well as cash. We need all of these assets definitely for operation of our business, and we do not have any non-operating capital in the overall capital of the SAP group. The SAP collection of arts comprises a total of 2,000 pieces of art.
Most are located at our headquarters in Walldorf, and these are handed out on a temporary basis to other locations regularly, and the total value of the collection is estimated to be in the low single-digit million EUR. What is your investment plan for the next five years, and how do you distribute the investments into the traditional business areas and opening up new business areas? Answer, in order to support the accelerated transformation of our customers into the cloud, we're planning significant investments in research and development in the next five years, as well as into the accelerated harmonization of the SAP infrastructure for cloud operation. We will also have an additional investment in the middle three-digit million euro area for the years 2021 and 2022.
In addition, in the other functional areas, we will invest in accordance with the group growth and in accordance with our strategic initiatives. Our investment applies to traditional business areas and also onto opening up new business areas. Regarding the traditional business areas, we invest on the one hand into a better integration of our existing product portfolios and into the accelerated harmonization of our cloud infrastructure. On the other hand, we also invest in new functionalities and into the performance of our existing products. Regarding new business areas, we refer to our strategic initiatives such as business process intelligence, industry cloud, business networks, and RISE with SAP, for which a significant share of the total investment volume has been earmarked for the next couple of years.
Was another question, only if applicable, which relates to the number and purchase costs of potential Wirecard shares in the books of our company. Well, we don't need to answer that question because we do not have any Wirecard shares in our books. Neither did we ever have them in our books. Next question, which consequences were drawn within the Executive Board and the Supervisory Board after the Wirecard disaster regarding the selection of the auditor, or which ones were considered? On the one hand, of course, the Audit Committee in 2020 also received comprehensive information on the activities of the auditor and the quality of the audit.
The review of the quality of the auditor included regular reporting of the auditor on its quality management system, as well as key findings which resulted from internal quality audits, external quality inspections as part of so-called peer reviews, and also from inspections carried out by regulators and supervisory bodies. At one meeting of the audit committee also discussed the possible impacts of the Wirecard scandal onto the external audit and corporate governance. The audit committee also dealt with the impacts of the Act on Strengthening the Financial Market Integrity, which is a direct consequence of the Wirecard situation. Next question, can you rule out phantom revenues in the company, and how specifically is that ensured? The answer is as follows. The integrated report of SAP says that the orderliness of the posting of revenues is ensured through stringent internal accounting guidelines and policies.
Furthermore, we have established numerous internal controls in the area of revenue recognition in order to ensure that we comply with these legislation in recognizing sales revenues. SAP, of course, is subject to the U.S. SEC requirements, which are very stringent and which we have been complying with for many years. Recognition of revenues from software license represents an important focus area of the audit of our auditor, not only as part of the year-end audit, but also during a quarterly review of selected contracts. Next question. How has the equity ratio developed in the last 24 months in the individual months, and in which three months did you have the lowest level? For our internal management, we only identify equity ratio on a quarterly basis because we do not expect any essential fluctuations on a monthly basis, which was confirmed in the last couple of months and years.
This also manifests itself in the development of the last 24 months. Equity ratio in 2019 and 2020 was always in a stable level between 58%- 51% of the overall equity. In the first quarter 2021, equity ratio was on a similar level to the previous years, namely at 52%. Next question. Are there any letters of comfort for or by the company? If so, to what extent and towards whom? It was also said that in the list of shareholders with footnote 16, the companies are identified for which SAP has issued letters of comfort. The extent can vary, and usually during the term, SAP commits itself to equip the respective subsidiaries financially in such a manner that at any point in time, it is able to meet its liabilities, existing and future ones, towards the contractual partners in due time.
Next question, to what extent are assets of the company pledged as securities for loans? Or how high is the total of uncollateralized assets? The good news is we have not pledged any assets of the company as part of credit loans or loans, which manifests itself in negative clauses or so-called negative pledges in our contracts. Were there any impairment tests, which resulted in a write-down requirement in the reporting year or in the course of the year 2021? If so, to what extent? In the reporting year 2020, there were no significant extraordinary write-downs. As a response to the COVID-19 pandemic, we have especially reviewed the goodwill and the intangible assets on a quantitative and qualitative basis at regular intervals as to the need for an impairment.
The regulatory impairment test, which was performed in the year 2020, was appreciated also by the auditor during the year-end audit. In connection with the accelerated harmonization of the SAP infrastructure for cloud operation, in the first quarter of 2021, we took an extraordinary impairment of EUR 150 million for tangible assets as restructuring expenditures. Next question. What was your biggest damage in the reporting year, and was it fully covered by the insurance? If I understand the question properly, then you're referring to insurance damage, and I can tell you that in the reporting year, no significant insurance damage occurred. Next question. What are the following data for the companies listed in the list of shareholdings of the parent company, namely A, revenues in EUR and change in percent over previous year. B, profit in EUR before profit transfer and change in percent over the previous year.
C, number of respective employees and change in percent compared to previous year. D, total equity in EUR and change in percent over the previous year. E, which respective measures did the Executive Board and the Supervisory Board take if there were any negative deviations on A to D? The answer is as follows. In the section G9 in our consolidated notes, you will find the shareholding list for the biggest consolidated companies. This includes the numbers you're asking for regarding revenues, profit, numbers of employees, and also the equity per company. Our three strongest companies in terms of revenues and also one of the three companies causing a deficit are included in that list. The shareholding lists of the year 2020 and of the year 2019 include the numbers of the reporting year and also of the previous year.
The two other ones of the three highest deficit companies in 2020 were Callidus Software Inc. and SAP Ventures GmbH. Their loss after taxes amounted to approximately EUR 50 million in 2020 and has hardly changed compared to the previous year. Your question number E, the internal reporting at SAP about individual companies is ensured through an automated dashboard. This dashboard shows the most important KPIs and provides transparency over relevant KPIs such as operating profit, operating margin, shareholders equity, debt equity ratio. It also allows for viewing of data, analyzing deviations, and making them available to the respective decision makers if required so that they can take appropriate measures. Here we have really a very tight monitoring system, which also allows us to initiate measures if that is required.
Next question, which amount was set as the materiality threshold, as a quantitative materiality threshold for the auditor annual financial statements as a whole? At what percent was the de minimis posting level set, and which changes did these two values see compared to the previous year? Our auditor determines the quantitative materiality threshold based on the percentage of our operating income, and this does not include one-off effects such as structuring efforts. This percentage in 2020 amounted to about 20%, which was unchanged over the previous year. For the audit of the individual annual financial statements of SAP SE, it was about 5% of the adjusted corresponding pre-tax profit. The de minimis posting level in the year 2020, as in the previous year, was at 75% of the materiality as well for the audit of transactions with related persons in the CEO compensation report.
For here, lower materiality thresholds were applied. How high were the costs for the payment office for the dividend in 2020? Our payment office in the past fiscal year received a compensation in the five-digit range. Please understand that to protect our business relationships with that bank, we do not want to disclose any further details. What was the strangest litigation in 2020, and what was it about? Well, all litigations we are involved in are taken very seriously by us, and we apply the utmost diligence to maintain the interests of SAP, and for that reason, none of the litigations that we have deserves the adjective curious or strange. How many subsidiaries are located in so-called tax havens, which means they are somewhat lenient in terms of taxes, and which functions do these subsidiaries have?
The German federal government in March of this year launched the draft for so-called Tax Haven Defense Act. It is to avoid tax evasion and unfair tax competition. The draft is currently going through the legislative procedure regarding critical countries or tax havens. The draft act refers to a joint list of the Council of Europe on non-cooperating tax countries promoting abusive tax practices. We are doing business in one of the countries listed in that list with a subsidiary. This is an operating sales subsidiary, and in its functional profile, it does not differ from any other sales subsidiaries with whom we serve local markets with our software and services. A question to the transparency register the federal government wants to introduce, and the question is, how many lobbyists does the group employ internally and globally?
Our government affairs unit currently employs 52 employees, 12 of them in Germany. Secondly, how high were in 2019 and 2020 in Germany and globally the costs for lobbying of the group? The costs for external lobbying or outside lobbying based on the Lobbying Disclosure Act for the U.S. amounted to $2.57 million for the year 2020. These costs were primarily borne by our U.S. organization. In the year 2019, the amount was slightly higher, namely EUR 2.71 million. Next question. Is the parent company or one of its subsidiaries member of the World Economic Forum in Davos? If so, what annual fees and entry tickets to the annual meeting were paid in 2020, and how many and which persons participated in this? Yes, SAP has been a member of the WEF and pays an annual membership fee of EUR 545,000 or CHF 600,000.
In accordance with the WEF rules in 2020, four executive board members participated in the annual WEF meeting in Davos, Christian Klein, Jennifer Morgan, Adaire Fox-Martin, and Thomas Saueressig. For each board member, an attendance fee of CHF 27,000 was paid. For the next questions, I hand over to Friederike again.
Thank you. Question, who has drawn up the compensation system for the executive board members? Were external advisors or consultants retained for that purpose? If so, who was that and which costs were paid? Who actually determines the exact compensation amounts for the individual executive board members on the basis of the system? Who verifies the results of these calculations? Is this done internally, or are also external specialists retained for that purpose?
Answer, the compensation system for the executive board members was drawn up under the auspices of the supervisory board with the help of internal and external support. Legal consultancy for the supervisory board was provided by the law firm Allen & Overy, which resulted in costs of about EUR 130,000. Basically, executive board members receive a fixed base salary and a variable compensation. Variable compensation is based upon several measurable performance criteria, which are assessed at the end of the respective performance term and which then determine the amount paid out. The necessary calculations are performed internally on the four-eye principle in collaboration with our controlling HR department. The calculation of the target achievement according to our long-term compensation, we obtain market data from an external service provider. Furthermore, the external auditor is also involved in the context of the audit of the annual financial statements.
Question: why did Ms. Greene on 9th of December 2020 escape the or flee from the Supervisory Board? What was the reason for her departure? Why did she not depart only as of the AGM, which would be the usual approach? Answer: It is correct that in coordination with SAP, Ms Greene resigned from the Supervisory Board of SAP on 9th of December 2020 for personal reasons. As public reporting indicated, Ms. Greene last year took over a new role as the chairman of the advisory council of the well-known Massachusetts Institute of Technology. This was no longer properly to be reconciled with assuming her Supervisory Board mandate at SAP. Question: how did the Supervisory Board identify the new candidates to the Supervisory Board and which key selection criteria were applied? The selection of candidates for the Supervisory Board is the responsibility of the Nomination Committee.
Possible new candidates are discussed by this committee. Selection criteria, apart from the general deliberations on the focus and composition of the supervisory board, include the level of skills and the type of skills and know-how, and the diversity of the concept of SAP, as well as the published targets for the composition of the supervisory board. Question: how many persons were on the long list? In the very first phase of the selection process, a total of 20 persons were put onto an extended list of candidates. Question: did the supervisory board select the candidates proposed for election itself, or was an HR consultant involved, and if so, which one and which costs did that cause? Of course, the nomination committee, and then also the supervisory board, chose the candidates proposed for election themselves.
To support the search for possible candidates, the HR consultancy HR Zehnder was retained, and for that purpose, costs of about EUR 250 were incurred. Question: who had preliminary meetings with the persons proposed for election, or have they introduced themselves at a meeting of the supervisory board? Answer: the members of the nomination committee held interviews with the candidates. Question: which major shareholders were involved in discussions on the composition and election to the supervisory board, and who held these meetings and discussions? Answer: in his role as the Chairman of the Supervisory Board, Hasso Plattner regularly meets with representatives of large institutional investors, and during these meetings, questions of corporate governance are addressed as well. On that occasion, the topic of the composition of the supervisory board and changes on the supervisory board are discussed as well.
However, there is no influence taken by shareholders or any agreements with shareholders in this regard. Now, once again, back to Luka for further questions.
Thank you. Next question is: in 2020, how high were traveling expenses with the parent company and with the German subsidiaries, and how about last year, and how high were they in this year? Traveling expenses in 2020 were more than EUR 20 million for the parent company, which is a reduction of 50% year-on-year. In 2021, traveling expenses are negligible because of travel restrictions due to Corona. For the subsidiaries in Germany, traveling expenses in 2020 were EUR 4 million, which is a reduction by more than 50% compared with the previous year, the traveling expenses in 2021 are negligible again because of the Corona-related traveling restrictions. Finally, how much equity is there per share and how much liabilities? The capital stock was, on the 31st of December 2020, EUR 1,228,504,232. This means 1,228,504,232 no par value shares with a nominal value of EUR 1.
According to the consolidated IFRS statement of SAP of December 31, 2020, liabilities per share were EUR 23. For the following questions on the Corona-Warn-App, I will hand over to Christian Klein.
The question on that app, I hope, of course, that you are an active user, Luka, of course you are. Right. The question was: hasn't the Corona-Warn-App failed because only 12.76% of all infections were reported or registered, and what is the use of that app? Why should it still be there? It is no failure at all. In the past four weeks, 63% of users shared their positive test result through the Corona-Warn-App. This is more than 83,000 people who warned five to six other citizens. In the past months, millions of people were warned of possible infections. They could go to quarantine and interrupt the infectious chain.
The app still plays a very important central role in containing the pandemic. According to data yesterday, the app has been downloaded 28 million times. It's the most successful tracing app in the EU. Has the Corona-App failed because of data protection? From our point of view, the Corona-Warn-App is very successful. It is based on current data privacy laws, and many people trust it, which is why so many people download it, and the trend is going up. Why didn't you develop the app further, prioritizing according to health and data protection, and then issued a separate version? The answer is we are in a global crisis, which can only be navigated together. An app like this must come from a government or from a public authority in order to provide an offering that is uniform and reaches as many people as possible.
That pandemic will be overcome only if we all pull it together. Therefore, the app remains voluntary. The fact that it fulfills the high data privacy and data security requirements has resulted in a high degree of trust among people and experts. Where are the IP rights of the Corona-Warn-App? This app is issued by the Robert Koch Institute, RKI, for the German federal government, and the source code was published on the open-source platform, GitHub. Why is there no selection function of the Corona App where a person can say, "I renounce the data protection rights?" Nearly 28 million downloads and half a million users who have shared their test results are not a bad rate. We are applying current data protection laws, and we have earned the trust of the population within a few weeks.
Nearly 7 million users who are voluntarily giving their data to the app, this means that the app is very effective. What is the total cost and how many man-hours have gone into the Corona-Warn-App? What is the distribution between SAP and Deutsche Telekom? Answer, the Corona-Warn-App is being developed continuously, and the cost is charged according to hours worked. As soon as the work is finished, the federal government will probably publish the figures. What is the contribution of SAP to society in fighting the pandemic? At the beginning of the COVID-19 crisis, SAP programmed a solution for the Foreign Office, which was used to get back more than 120,000 stranded holiday tourists, to fly them back into Germany. After that, SAP and Deutsche Telekom got the contract to program the Corona-Warn-App.
From the point of view, the Corona-Warn-App supports us in identifying and informing people who are in danger. It provides a number of functions to help as an additional element in fighting the Corona pandemic. At the beginning of the AGM, I gave you many more examples of how we are contributing to fighting the pandemic. Final question, why did SAP not provide any software to alleviate the problem with giving people appointments for vaccinations? The Corona-Warn-App was also developed relatively quickly. Well, the different authorities were responsible, and the federal states decided to go for other vendors. SAP and Deutsche Telekom got the award in Saxony for vaccination logistics and for appointments. The final two questions will be answered by Ms. Rotsch.
Why weren't you neutral in the shareholder portal? Did you not violate neutrality rules on the portal?
What is the advantage in programming the portal as you did? Mr. Gabler, you're talking about the possibility to support all suggestions on all proposed resolutions. This function was designed in the way it was because, speaking from experience, the predominant share of users votes yes on the proposals of the executive and supervisory board, so it makes sense to pre-populate the fields in this way. This is something we also see with other companies, and also the physical voting cards have always had the option to tick one field or put a cross into one field to support or to vote for all proposals by the executive and supervisory boards. We do not think that this constitutes influencing people in the way they vote. The final remark by Mr. Gabler, and this concerns reading out the full details of the voting results, and we will do that.
Ladies and gentlemen, we have now answered all questions which were submitted before the Annual General Meeting of Shareholders via the Shareholder Portal. We hope that we have answered all of your questions satisfactorily. In this connection, I would like to inform you that all shareholders who have properly registered for our Annual General Meeting and exercise their voting right as provided for in law, have the right to object to one or more of the resolutions to be passed at this general meeting should they see any grounds for doing so. I have now received information about the attendance, and I'll read out the attendance report. The capital stock of the company of EUR 1,228,504,232, divided in the same number of shares represented at this meeting, are 760,763,331 no-par value shares with the same number of votes. This corresponds to 58.34% of the capital stock.
In addition to that, we've received postal votes, 145,338,844 shares. These were later taken into consideration when the voting results are determined on the agenda items two to nine. 862,102,175 shares are present or represented by postal vote. This means 70.17% of the capital stock. Ladies and gentlemen, we now come to the votes on the management proposals in respect of agenda items two to nine, including the sub-items A and B in item six. The agenda items are now displayed in their short versions on your screens again. As I explained earlier, you now have one last opportunity to appoint and instruct the proxies designated by the company, change your proxy appointments, or cast your votes electronically via the password-protected shareholder portal. If you wish to make use of this opportunity, please do so now.
We will close the corresponding functions in the shareholder portal in a few short moments. The company proxies appointed by you will cast your votes by releasing your voting instructions as they have been entered in the system. The postal votes received before the deadline will also be included in the final count. A simple majority vote is required for the resolutions in connection with the agenda items two to six. The vote on agenda items seven to nine requires a majority of at least 3/4 of the capital stock represented during the voting on the resolution. With regard to agenda items three and four, I expressly draw your attention to the voting exclusion in Section 136 of the German Stock Corporation Act. Ladies and gentlemen, I assume that all shareholders have had sufficient time to exercise their voting rights.
The functions for voting and for appointing and instructing proxies in the shareholder portal have been closed. The proxies appointed by the company are now casting your votes by releasing your voting instructions in the system, and this concludes the vote. I will interrupt the general meeting while the voting results are being determined. Notary Public Dr. Fellmeth will supervise the counting of the votes. I will announce the results of voting as soon as I have them.
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Ladies and gentlemen, I now have the voting results and will proceed with the meeting. I will now determine and announce the results. To comply with the shareholder request we received, I will read the full version with all details. The voting results will be published without delay on our website. I will also give the notary a printout of the detailed voting results for his minutes. Ladies and gentlemen, I now have the results of the votes on the proposals on agenda items two to nine, and I determine and announce the results. The AGM, with a presence of 716,801,963 no par value shares with one vote each, as well as 145,592,228 for the written votes, which totals 70.2% of the capital stock divided into 1,228,504,232 no par value shares, which also includes 48,924,892 own shares and decided as follows. Results on proposals on agenda item two.
Number of shares with valid votes 895,386,225. That's 69.95% of the stock capital. Votes against 3,586,756. Votes in favor 855,799,539. I state and declare that thus the AGM has approved with 99.98% the appropriation of the retained earnings according to the resolution. The result on agenda item three. Number of shares with valid votes 852,178,173. That's 69.37% of the current stock. Votes against 5,916,000. Votes in favor 846,173,757. I state and declare that thus the AGM has approved agenda item three with 99.2% and has approved the members of the board in fiscal 2020. On behalf of the Executive Board, I would like to express my thanks to the trust shown here. The result on agenda item four. Number of shares with valid votes 760,393,836. That's 61.9% of the capital stock. Votes against 115,047,653. Votes in favor 645,346,183.
I state and declare that the AGM has approved agenda item four with 84.7%. That is in line with the single majority required, has approved the acts of the supervisory board members in fiscal 2020. On behalf of the supervisory board, I'd like to express my thanks for the trust shown in us. Agenda item five. Number of shares with valid votes 859,273,613. That's 69.94% of the capital stock. Votes against 34,022,019. Votes in favor 825,285,594. I state and declare that the AGM has approved with 96.04% of the valid votes, in line with the single majority required, has appointed KPMG as auditor for fiscal year 2021. The result on agenda item 6A. Number of valid votes 856,960,408. That's 69.76% of the capital stock. Votes against 23,676,035. Votes in favor 833,284,373.
I state and declare that thus the AGM has approved the by-election with 97.04% in line with the required single majority, and has thus elected Dr. Qi Lu to the supervisory board. Congratulations. Resolution 6B. Number of shares with valid votes 856,975,120. That equals 69.76% of the capital stock. Votes against 34,598,209. Votes in favor 822,385,911. I state and declare that thus the AGM has approved with 95.96% of the proposal and has thus elected Dr. Rouven Westphal to the supervisory board. Congratulations. Result on agenda item seven. Number of shares with valid votes, 836,386,138. That's 68.08% of the stock capital. Votes against, 66,200,724. Votes in favor, 780,185,414. I state and declare that thus this AGM has thus approved with 93.28% in line with the capital majority required, thus granting the authorization of the executive board to issue convertible and/or warrants and bonds.
The option to exclude shareholder subscription rights, the cancellation of contingent capital one, and the creation of new contingent capital and the corresponding amendment to Article four as laid down in the proposal that were published under agenda item seven in the invitation. Results on item eight of the agenda. Number of shares with valid votes, 859,085,286. That equals 69.39% of the stock capital. Votes against, 142,969. Votes in favor, 858,915,317. I state and declare that the AGM has thus approved with 99.98% of the votes cast, reaching the requirements, and has thus approved the amendments of Articles two, Section one of the Articles of Incorporation as laid down in the invitation under agenda item eight. Results of the vote on agenda item nine. Number of shares with valid votes, 859,119,234. That equals 69.93% of the stock capital. Votes against, 184,122. Votes in favor, 858,971,112.
I state and declare that thus the AGM has approved with 99.98% of the votes cast, that is reaching the required vote majorities, has approved the amendment of Articles 18 of the Articles of Incorporation, right to attend the general meeting of shareholders, proof of shareholding, in line with the resolutions laid down in the invitation under agenda item nine. Ladies and gentlemen, all agenda items have now been addressed. I will now close this virtual annual general meeting. On behalf of the Supervisory Board and the Executive Board, thank you very much for attending this virtual AGM. I would also like to add my own thanks and those of the shareholders to the Executive Board and all employees of SAP. Thank you very much. Stay safe, stay healthy. See you next year.