At ArcGIS 10.1 & 10.2, the SQL Server Native client is not automatically installed with ArcGIS Desktop (as per previous ArcGIS Desktop versions) – it must be explicitly installed.
The SQL Server Native client can be downloaded from the Customer Care Portal.
Customer Care Portal: https://customers.esri.com
Login. Under My Software > Click Software Download
Under DBMS Support Files > Click DBMS Support Files for ArcGIS 10.1
Under Microsoft SQL Server 2008 R2 Native Client > Choose either the 32-bit or 64-bit version > Click Download button.
Under DBMS Support Files > Click DBMS Support Files for ArcGIS 10.2
Under Microsoft SQL Server 2012 SP1 Native Client > Choose either the 32-bit or 64-bit version > Click Download button.
Under Geodatabases > “Client libraries for Geodatabase Connection”
“The installation of ArcGIS 10.1 doesn’t include client libraries for the various relational database management systems (DBMS). These have been provided on the Esri Customer Care Portal for user downloads to set up connections to the intended DBMS.”
It is also further reiterated via the following ArcGIS web help:
“…You can obtain DBMS client installations from the DBMS vendor or download them from the Esri Customer Care portal. “