Outlook for 2002 and 2003

Integrating sustainability Sustainability is an integral part of ABB and its business. A new research and development program integrating sustainability was launched last year.

Corporate activities
Sustainability is becoming an integrated part of ABB’s strategic planning and our management systems. In 2002 and 2003, we will work closely with selected business areas to start this process.

In 2001, we developed business plans for our sustainability controllers at business area and country levels. These will be implemented from 2002 onwards.

The new corporate R&D program "Sustainability and Global Change" was launched in 2001. It focuses on medium- and long-term sustainability issues affecting ABB’s business.

Maximizing the sustainability of our business requires understanding and active commitment from all ABB’s employees - not just strategic planners and managers. In 2002/3, we will plan and launch a new internal awareness campaign to show that sustainability is everyone’s business.

We also intend to start to work with key customers in selected industries, looking at sustainability throughout their respective supply chains. The objective is to build up a picture of the environmental, social and economic impacts of each industry segment, from primary production to disposal of products that are no longer in use.

These analyses will take some while, but as our pictures of each industry segment become clearer, we will share our understanding with customers and society at large. We hope this will lead to better-informed choices and more sustainable industries.

Our main priorities

• To integrate sustainability into all management systems
• To raise awareness and engage the commitment of every employee
• To extend our environmental management system to non-manufacturing activities
• To implement our social policy worldwide, with guidelines and performance indicators
• To help combat poverty through our "Access to Electricity" program

Transportation Vehicle emissions are a major contributor to global warming, not to mention their other impacts on the environment and health. ABB is now looking into its movements of goods and people around the world with a view to cutting costs and environmental impact. A pilot study, covering ABB’s operations in Switzerland, will be made in 2002.

The environmental bottom line
Almost all ABB’s manufacturing and service sites now have environmental management systems implemented to the ISO 14001 standard. We will focus attention on the last few sites, with the goal of reaching 100 percent implementation.

In 2002, we will begin extending our environmental management systems to cover non-manufacturing activities, such as research and development, engineering and sales and administrative offices. We will also continue to implement unified systems for quality, environmental and health and safety management.

We will work closely with ABB’s supply management teams to tighten our supplier selection criteria and ensure that key suppliers match our own environmental and social performance standards.

Our growing library of Environmental Product Declarations has been very well received, both internally and by customers. We hope to accelerate the publication of declarations in 2002 and 2003.

We will continue to eliminate unwanted and hazardous materials in our products, and increase the use of recycled materials.

The economic bottom line
Improving our sustainability performance will also improve our economic performance. Many environmental improvement projects ultimately save money as well as the environment. Eco-efficiency in our products is something that more and more customers want and are prepared to pay for.

In 2002 and 2003 ABB personnel who have direct contact with customers will receive extra sustainability training. They will learn how to use sustainability arguments to communicate the benefits of our products, systems and projects. Our Environmental Product Declarations are important tools in these efforts.

The social bottom line
The implementation of our social policy is a priority, following its publication and the first rounds of stakeholder consultation in 2001. We will develop guidelines for the worldwide application of each of the 13 principles of the policy. We will also develop social indicators in order to measure our performance. The advice and suggestions from the stakeholder dialogue sessions will help us in this work.

ABB has formed an internal steering group to monitor the implementation of the social policy. This group can mobilize all necessary resources to ensure rapid and full-scale action.

There are new group-wide guidelines for occupational health and safety, including a "zero-target" policy for serious and fatal incidents, and improved reporting procedures. These will be implemented at all ABB sites during 2002.

The program of stakeholder dialogues, initiated with the launch of the social policy in 2001, will be continued and expanded to cover other topics in 2002.

Common efforts and communication

Among the most promising of ABB’s common efforts activities is the “Access to Electricity” program we launched in 2001. Lack of basic infrastructure – for which electricity is vital - today keeps around 2 billion people trapped in poverty.

ABB has core technologies and competencies that can help in development projects to ease this form of poverty. In the coming years we intend to put significant effort and resources into this program.
We are now defining and agreeing objectives, together with our prospective partners in the program. Before the end of 2002, we hope to have signed formal agreements with the partners. We will then create a business plan.

We will select sites for pilot projects in 2003 and start work on the ground as soon as possible.

ABB chairs the greenhouse gas reduction program organized by the World Energy Council (see pages 38–39). We will continue to support this work and the knowledge base of greenhouse gas reduction projects and opportunities it is building.

Finally, we will increase communications about our efforts - mainly by providing more news and information on our corporate Web site.