ABB

No leading practices were identified for this company.

No leading practices were identified for this company

No leading practices were identified for this company

No leading practices were identified for this company

ABB has set a target to reduce its scope 1 and 2 emissions by 80% by 2030 compared to 2019 levels, while offsetting the remaining 20%. The company has also committed to reducing its scope 3 emissions by 15% in the same period; however, this is not ambitious enough compared to its 1.5°C pathway. ABB’s scope 1 and 2 emissions have decreased by 65% in 2022 compared to 2019. However, in the last three years, the company’s scope 3 emissions – which constitute 99% of its overall emissions – have been stagnating.

ABB demonstrates a comprehensive 2030 sustainability strategy, informed by robust climate scenario testing. Regardless, the company does not disclose its process to review and update its low-carbon transition plan, nor provide detailed financial commitments. In 2022, only 10% of ABB’s overall revenues came from EU taxonomy-aligned low-carbon technologies.

ABB dedicated 14% of its overall capital expenditure (CapEx) to EU taxonomy-aligned low-carbon technologies in 2022, which is well below its expected contribution. The share of R&D investments in such technologies is negligible. ABB does not show it is making any significant efforts to address the emissions from the use of its sold products, which constitute the largest portion of the company’s overall emissions.

Although the company has implemented a supplier engagement strategy, it does not specifically include greenhouse gas (GHG) emissions reduction requirements for suppliers. There is no evidence that emissions reduction targets are considered by the company in the selection of new suppliers or in contract renewals with existing suppliers. However, the company does have a quantified target to help its customers reduce their annual carbon dioxide (CO2) emissions by 2030.

As a part of its 2030 sustainability strategy, ABB has set targets to reduce its scope 1, 2 and 3 emissions. More broadly, the company positions itself as an enabler for a low-carbon society, committing to all environmental, social and governance (ESG) aspects. Regardless, it needs to raise the ambition of its emissions targets.

ABB is working on electrifying its fleet, improving energy efficiency for its operations, and sourcing its electricity from renewable sources. The company also engages with its main tier 1 suppliers to help them reduce their emissions. It identifies better sourcing of materials and circularity as key levers to preserve resources.

ABB serves various industries to enable their low-carbon transition through electrification, with about half of its revenues linked to this business area. The company is positioned as a leader in providing solutions to wind and solar power manufacturers, and also helps other industries with electrification and digitalisation of plants.

The company has made significant progress in terms of decarbonising its own operations. However, without clearer evidence, it does not appear credible that the company will achieve its scope 3 emissions target by 2030, even though its ambition in this area is lacking and can be improved.

ABB has set a clear roadmap to decarbonise its own operations and to lower upstream emissions from purchased materials. However, there is no evidence that the company is willing to transition its portfolio away from products that are responsible for high emissions during their use phase.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders. No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks. The company discloses the actions it takes to provide training opportunities for workers and affected stakeholders. For instance, it collaborates with the Sambhav Foundation to offer IT skills training for domestic assistance electricians. Furthermore, the company discloses the measures it takes to embed equality of opportunity for women and vulnerable groups in these actions. It does this through educational programs and skill development initiative to loacl commuities in India. However, no evidence was found of the company having a process for identifying skills gaps for workers and stakeholders affected by the low-carbon transition or a public commitment to help workers displaced by the transition to reskill or upskill.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders. No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights. However, no evidence that the company commits to respecting the ILO fundamental rights at work, nor does it expect its business relationships to respect the same commitment. The company discloses a human rights due diligence process that includes the identification and assessment of salient human rights risks, such as child labor, community and land rights, corruption, human trafficking, and modern slavery. However, no evidence that the company takes action to mitigate these risks in its own operations and supply chain, nor does it engage with affected stakeholders. The company has a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment of its business relationships. However, no evidence was found of a time-bound target for paying all workers a living wage. Moreover, no evidence was found that the company discloses the proportion of its direct workforce covered by collective bargaining agreements and the company’s required working hours. The company discloses the gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. The company commits to gender equality and women’s empowerment.

No evidence was found that the company commits to protecting personal data and that it has a privacy statement regarding the collection, sharing and access to personal data. While the company discloses its global tax strategy, no relevant disclosure was found of the corporate income tax paid for each relevant jurisdiction. The company does have a policy prohibiting bribery and corruption, and it includes corresponding clauses in its contracts with business relationships. While the company specifies that it does not make political contributions, no evidence that it has a lobbying and political engagement policy. No relevant disclosure was found of the company’s expenditure on lobbying activities.