Sustainability

For ABB, sustainability is about balancing economic success, environmental stewardship and social progress to benefit all our stakeholders. Sustainability is part of ABB’s corporate strategy and business success.

Sustainability, like innovation, is in the DNA of ABB. In part, this is because our business has always been rooted in the efficient transmission and distribution of electricity, and in improving the uptime, speed and yield of our customers’ operations in utilities, industry and transport & infrastructure. Our current sustainability framework, adopted in 2013, prioritizes pioneering technology, responsible operations and responsible relationships. It clearly articulates how ABB creates value across a wide range of stakeholder issues.

Enabling the Sustainable Development Goals

ABB is helping to address the important economic, social, environmental and governance challenges enshrined in the United Nations Sustainable Development Goals (SDGs). We recognize that achieving these goals requires businesses to contribute their fair share, and our structured analysis identified seven SDGs where we can have the most impact. Our products, services and solutions not only enable SDG 7 (affordable and clean energy), which is one of our core business areas, but also SDGs 6 (clean water and sanitation), 9 (industry innovation and infrastructure), and 11 (sustainable cities and infrastructure). The remaining three reflect our long-standing commitment to responsible operations and responsible relationships: namely SDG 12 (responsible production and consumption), 8 (decent work and economic growth) and 17 (partnership for the goals).

ABB’s contribution to climate action

ABB contributes to climate action by encouraging the early and rapid adoption of clean technologies and by helping its customers improve energy efficiency and productivity while extending the lifecycles of their equipment and reducing waste. More than half of ABB’s global revenues are derived from technologies that directly address the causes of climate change, and it aims to increase that contribution to 60 percent by 2020. The company’s commitment to combatting climate change includes limiting the environmental impact of its own operations. It has set itself the target to reduce its GHG emissions by 40 percent by 2020 from a 2013 baseline.

ABB actively engages with civil society to encourage bold action on climate change. We are a member of the Alliance of CEO Climate Leaders, an informal group facilitated by the World Economic Forum. Together we signed an open letter ahead of COP24 to confirm our commitment to fast-track solutions to help deliver on an enhanced and more ambitious global action plan to tackle climate change and meet the goals set out in the 2015 Paris Climate Agreement. ABB is also an active contributor to the Low Carbon Technology Partnerships Initiative of the World Business Council for Sustainable Development.

External recognition

ABB’s contributions to climate action are widely acknowledged and were most recently recognized in August 2018 by “Fortune” magazine, which named ABB as one of the top 10 companies that are changing the world. We also report to a sustainability platform called EcoVadis, which a large number of customers use to access sustainability information on environment, fair labor & human rights, ethics and sustainable procurement. In 2018 EcoVadis scored our response as “Gold” and among the top 1 percent of companies rated in our sector.

Embedding human rights into its business processes and activities

Everyone who works for us, either as a direct ABB employee or indirectly through our supply chain, is expected to behave with respect for the dignity and human rights of every individual. We fully acknowledge our Group’s responsibility to respect the International Bill of Human Rights, and are committed to implementing the UN Guiding Principles on Business and Human Rights.

Since our first formal Human Rights Policy was published in 2007, we have worked to integrate these principles into our decision-making processes and included them in relevant due diligence activities. In addition, the ABB Supplier Code of Conduct, the ABB Policy Combating Trafficking in Persons, and our Human Rights Policy all make clear that ABB does not tolerate modern slavery or human trafficking. Furthermore, we are keenly focused on human rights issues of interest to our external stakeholders, such as conflict minerals, human trafficking and child labor, and we work to ensure our policies and principles are implemented and observed along our value chain.

2018 progress against targets

ABB’s structure of nine sustainability objectives with 11 targets to achieve by 2020 demonstrates how we are addressing our material issues (see table). In 2018 we continued to make good progress. Our eco-efficiency portfolio of products, solutions and services continues to grow in line with our target to account for 60 percent of ABB’s total revenue by 2020. This portfolio delivers positive use-phase impacts in three areas: energy efficiency, renewable energy and resource efficiency. In responsible operations all reported measures are on track to achieve the 2020 targets. The health and safety of those affected by our activities – particularly our employees, contractors and customers – are a top priority for ABB, and we have worked for many years to manage and reduce the environmental impacts of our own operations. Our responsible relationships measures are also on track thanks to the roll-out of new training courses on the ABB Code of Conduct and Human Rights, the implementation of a gender diversity framework and our commitment to delivering well-being programs covering different aspects of health, including non-smoking, health nutrition, physical fitness, mental health, vaccinations, voluntary medical checks, promotion of good ergonomics and addiction prevention.

Valued insights from stakeholders

Since 2015, ABB has sought input and advice from an external stakeholder panel, which reviews our material issues, our approach to sustainable development and our sustainability report. Panel members represent the key market and non-market stakeholders of the company and are selected for their level of knowledge and skills regarding sustainable development issues relevant to the company. The panel’s statement can be found here.

Following the announcement of a new business strategy focusing the portfolio on digital industries, the divestment of Power Grids and the conclusion of our 2020 sustainability targets, ABB has initiated a process to formally engage with a large number of key stakeholders and embark on a comprehensive materiality review to provide a foundation for the development of ABB’s post-2020 sustainability objectives.

Read more at abb.com/sustainability

Pioneering technology

Objective

Measure

2020 Target

2018 Performance

Products, solutions and services

Increase share of ABB eco-efficiency portfolio

60% of revenue

57%

Goal status – on track (icon)

Responsible operations

Objective

Measure

2020 Target

2018 Performance

Safe operations

Reduce employee total injury frequency rate

<0.7

0.58

Goal status – achieved (icon)

Climate action

Reduce greenhouse gas emissions (GHG)

by 40% (vs 2013)

36%

Goal status – on track (icon)

Resource efficiency

Reduce water consumption in water-stressed areas

by 25% (vs 2013)

12%

Goal status – in progress (icon)

Reduce waste sent for disposal

by 20% (vs 2013)

18%

Goal status – on track (icon)

Right materials

Reduce emissions from VOCs

by 25% (vs 2013)

27%

Goal status – achieved (icon)

Responsible sourcing

Closure of identified risks from supplier assessments

>65%

76%

Goal status – achieved (icon)

Responsible relationships

Objective

Measure

2020 Target

2018 Performance

Integrity

Employees trained on integrity

>96%

98%

Goal status – achieved (icon)

Human rights

Training for specific job roles exposed to human rights risks

2 campaigns per year

2

Goal status – achieved (icon)

Our people

Increase women in senior management

by 30% (vs 2017)

10.5%

Goal status – in progress (icon)

Employees covered by the ABB well-being program

>70%

67%

Goal status – on track (icon)

Goal status – achieved (icon)

Achieved

Goal status – in progress (icon)

On track

Goal status – on track (icon)

In progress