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FY2025 Annual Report · ABB
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INTEGRATED 
REPORT 2025

	
▲The cover photograph depicts an engineer at ABB’s Helsinki 
factory, which has built large motors and generators since 
1889 for global high-power industrial applications.

ABB is a global technology leader in 
electrification and automation, enabling 
a more sustainable and resource-efficient 
future. By connecting its engineering 
and digitalization expertise, ABB helps 
industries run at high performance, while 
becoming more efficient, productive and 
sustainable so they outperform. At ABB, 
we call this “Engineered to Outrun”. 

TAKE THE SURVEY
The ABB Integrated Report 2025 provides the 
most important information about the compa-
ny’s strategy, performance, governance, and 
value creation of ABB’s worldwide operations 
for the financial year ended December 31, 2025. 
This report aims to go beyond traditional re-
porting to convey who ABB is, what we stand 
for and where we are going. In this report, we 
show how ABB creates long-term value through 
our people, technology and strategy, as well 
as our robust governance. In addition, the re-
port shows how we drive growth and provide 
superior value, helping industries become 
leaner and cleaner for a more sustainable and 
resource-efficient future.
By focusing on material issues and integrat-
ing financial and sustainability data, this 
report provides a holistic view of how ABB 
delivers value not just for our business and 
shareholders, but also for our customers, em-
ployees, partners, communities, and planet. 
The ABB Way, our decentralized operating 
model, underpins this approach, enabling us 
to grow our business and strengthen our resil-
ience while generating positive social, environ-
mental, and economic impact.
This Integrated Report is part of ABB’s An-
nual Reporting Suite, which consists of our 
Financial Report, Sustainability Statement, 
Corporate Governance Report, as well as our 
Compensation Report. This Integrated Report 
is prepared using the International Integrated 
Reporting Framework, which is now overseen 
by the International Financial Reporting Stan-
dards (IFRS) Foundation.
ABB’s senior management and Board of Di-
rectors take responsibility for the accuracy 
and integrity of information in this report. 
Data is drawn both from our Financial Report 
and our Sustainability Statement. Our con-
solidated financial statements, presented 
within our Financial Report, are prepared in 
accordance with U.S. GAAP and subject to 
external audit requirements. Our sustainabil-
ity reporting follows the European Sustain-
ability Reporting Standards (ESRS) and our 
Sustainability Statement is subject to limited 
assurance requirements.
Since ABB Ltd is listed on stock exchanges 
in both Switzerland and Sweden, our Annual 
Reporting Suite is filed with the SIX Swiss 
Exchange in Zurich, Switzerland, and NASDAQ 
OMX Stockholm Exchange, Sweden.
We at ABB would appreciate your feedback on this Integrated 
Report. This survey takes less than two minutes to complete. 
Your input helps us continuously improve our reporting. 
Our entire Annual Reporting 
Suite 2025, including 
our Financial Report, 
Sustainability Statement, 
Corporate Governance Report 
and Compensation Report 
are available on our online 
reporting hub.
ABOUT THIS REPORT

TABLE OF CONTENTS
INTRODUCTION 
6
ABB in 2025	
7
Chairman’s letter 	
8
Targets & ambitions	
10
Important milestones in 2025	
12
CEO Q&A	
14
About ABB	
16
ABB Way	
21
ABB share performance	
23
VALUE CREATION 
26
Our business environment	
27
Decentralized business model	
32
Our strategic priorities	
36
Risks & opportunities	
42
We deliver leading financial performance 	
44
We enable a low-carbon society 	
54
We preserve resources 	
66
We promote social progress 	
74
GOVERNANCE 
88
Corporate governance	
89
Compensation	
93
Integrity & transparency	
100
01
02
03

INTRODUCTION
01
ABB in 2025	
7
Chairman’s letter 	
8
Targets & ambitions	
10
Important milestones in 2025	
12
CEO Q&A	
14
About ABB	
16
ABB Way	
21
ABB share performance	
23

ABB IN 2025
Acquisitions completed
6
Venture Capital 
investments ($mn)
28
Manufacturing sites
>160
Capital Expenditures ($mn)
1,001
R&D investment ($mn)
1,318
Employees in R&D
7,8005
Employees
111,900 
Women in workforce (%)
27.8
Energy consumption (GWh)
1,473 
(-3.7%)
Renewable electricity (%)
 98
Order backlog 
(end December $mn)
25,282 
+27%
Income from operations 
($mn)
6,047 
+28%
Net Income Attributable 
to ABB ($mn)
4,734 
+20%
Basic Earnings Per Share ($)
2.59 
Dividend Per Share (in CHF)
0.944
1.	 For reconciliation of alternative performance measures, see “supplemental reconcil-
iations and definitions” in the Q4 2025 Financial Information booklet available on the 
Investor Relations website.
2.	 Percentages calculated using headcount data. The above disclosure relates to countries 
where policies legally permit and to the extent that it does not conflict with any applica-
ble local laws, where ABB operates, and therefore 13 percent of total senior management 
is not included in the disclosure.
ORDERS 
in mn
Comparable1 
growth vs. 2024
$36,765
+15%
OPERATIONAL EBITA1 
in mn
Change vs. 2024
$6,314
+13%
FREE CASHFLOW1 
in mn
Change vs. 2024
$4,566
+16%
GHG EMISSIONS (SCOPE 1 AND 2)3 
in ktCO₂e
Change vs. 2024
134 
-2.6%
REVENUES 
in mn
Comparable1 
growth vs. 2024
$33,220
+7%
OPERATIONAL 
EBITA MARGIN1
Change vs. 2024
19.0%
+80 bps
ROCE1
Change vs. 2024
25.3%
+150 bps
WOMEN IN SENIOR 
MANAGEMENT2
Change vs. 2024
22.6%
+130 bps
3.	 Scope 2 refers to market-based values.
4.	 Proposed by the Board of Directors and subject to approval by shareholders at the Annual 
General Meeting on March 19, 2026, in Zurich, Switzerland.
5.	 Excludes R&D employees pertaining to the Robotics business.
7
Introduction  |  ABB in 2025
Value creation
Governance

In 2025, ABB was able to deliver record results thanks to 
strong customer demand for our solutions, but also due 
to our ABB Way operating model, which has made our 
company more agile and efficient. We remain committed to 
creating value for all stakeholders by helping our customers 
improve their performance and become more productive, 
efficient, and sustainable.
Dear shareholders,
The year 2025 was characterized by 
heightened geopolitical tensions, in-
creased economic uncertainty, and the 
rapid advance of disruptive technologies, 
particularly artificial intelligence (AI). In 
such a dynamic environment, it was more 
important than ever for companies to 
remain true to their purpose and values. 
At ABB, we have done just that by mak-
ing the necessary tactical adjustments, 
while remaining firmly committed to 
our strategic course to create value for 
our stakeholders.
Throughout the year, the trading envi-
ronment proved robust. We saw strong 
demand for our solutions, especially in 
sectors such as data centers, marine, 
ports, utilities and infrastructure such 
as tunnels and airports. This shows that 
we are well-positioned at the center of 
key megatrends, such as the expansion 
of the energy system due to the growing 
demand for electricity as well as energy 
security and the energy transition.
Record year for orders and profits
Strong market demand for our solutions 
helped us achieve a record year for orders 
and revenues. We also increased profits 
despite challenges like tariffs and higher 
materials prices. This shows we are con-
tinuing to improve efficiency under our 
decentralized ABB Way operating model 
with its focus on accountability, trans-
parency, and speed. In recognition of this 
excellent performance, and in line with 
our policy of delivering a rising and sus-
tainable dividend over time, the Board 
of Directors will propose a dividend of 
CHF 0.94 per share at the upcoming An-
nual General Meeting.
We continued to make strong progress 
towards our sustainability targets, and 
have already almost reached our 2030 
target of an 80 percent reduction in our 
scope 1 and 2 emissions. I want to stress 
that ABB remains fully committed to our 
Sustainability Agenda. We will continue 
to support our customers in improving 
their performance while making their op-
erations more productive, efficient, and 
sustainable. We will also fulfill our own 
sustainability targets and strategy in line 
with our purpose of enabling a more sus-
tainable and resource-efficient future.
A broad-based Board of Directors
In 2025, our Board of Directors continued 
to evolve. We have a wide diversity of in-
dustry knowledge, skills and experience 
as well as a more equal gender balance 
on the Board. 40 percent of our Board 
members are women – above the 30 per-
cent stipulated by the Swiss Code of 
Obligations. Our Board has a very good 
mix of broad general experience as well 
as in-depth expertise. Certain members 
serve in executive positions outside of 
ABB while others sit on further boards 
of directors, all contributing diverse per-
spectives and valuable experience.
CHAIRMAN’S LETTER 
8
Introduction  |  Chairman’s letter
Value creation
Governance

This diversity of perspectives is important 
because the Board not only supervises the com-
pany, but is also responsible for ensuring that 
ABB is strategically positioned to achieve our 
long-term targets. This requires greater consid-
eration of geopolitical aspects and overall risk 
management than ever given the fast-changing 
and uncertain environment in which we are 
operating. We cannot and should not manage 
ABB in terms of “legislative periods” or “elec-
tion cycles,” but must be oriented toward the 
long term.
In 2025, we welcomed Claudia Nemat to our 
Board of Directors. As a former member of 
the management board of Deutsche Telekom, 
responsible for technology and innovation, and 
with previous board experience at Lanxess and 
Airbus, Claudia perfectly complements the com-
petencies of our Board.
Confidence in ABB’s prospects
Our confidence in ABB’s prospects is reflected 
in the updated margin and return ambitions 
announced at our Capital Markets Day in No-
vember 2025. Our “local-for-local” strategy of 
designing and producing close to our custom-
ers makes us resilient and self-sufficient in our 
main markets.
We continue to actively manage our portfolio 
to ensure that our divisions are aligned with 
our purpose, that they serve markets which are 
growing and profitable, and that they create 
more value by being part of ABB than they 
would under different ownership.
In 2025, we decided to accept an offer from 
SoftBank Group to acquire our Robotics divi-
sion rather than pursuing our original intention 
to spin off the division. Our decision took into 
account the long-term strengths of the division, 
the advantages of Robotics being part of a 
leading AI and software company, and the fact 
that the divestment will create immediate value 
for ABB shareholders. We will use the proceeds 
from the transaction in line with ABB’s estab-
lished capital allocation principles.
With the planned divestment of Robotics, 
we now have three business areas – Electri-
fication, Motion and Automation (formerly 
Process Automation) – with strong shared sales 
and technology synergies that position ABB for 
higher growth and stronger earnings.
On behalf of the Board of Directors, I would like 
to thank our employees for delivering such an 
excellent performance in 2025. I would also like 
to express gratitude to our customers, part-
ners, and our valued shareholders for your con-
tinued trust and support. We are excited about 
the future and look forward to continuing this 
journey together with you.
Best regards, 
PETER VOSER 
Chairman of the Board of Directors
“We are well-positioned at the center of 
key megatrends… Our ‘local-for-local’ 
strategy of producing close to our 
customers makes us resilient and 
self-sufficient in our main markets.”
9
Introduction  |  Chairman’s letter
Value creation
Governance

TARGETS & AMBITIONS
TARGETS AND AMBITIONS
2025 PERFORMANCE
OUTLOOK
We deliver leading financial performance
Comparable revenue growth: 5–7%
7% comparable revenue growth
2026 comparable revenue growth in the range of 6–9%.
Operational EBITA margin: 
Prior target: 16–19%
Updated target: 
18–22%
19.0% Operational EBITA margin
2026 Operational EBITA margin should slightly improve year-on-year, 
even when excluding the announced real estate gain in the first quar-
ter of 2026.
Return on capital employed (ROCE):Prior target: >18%
Updated target: >20%
25.3% ROCE
FCF conversion to net income: 
Prior target: ∼100%
Updated target: >95%
96% FCF conversion to net income
EPS: At least high single-digit growth 
+21%1 year-on-year
We enable a low-carbon society
Reduce own scope 1 and 2 CO₂e emissions by at least 
80% by 2030 vs 2019
79% reduction of scope 1+2 CO₂e emissions 
since 2019
Reduce scope 3 CO₂e emissions by 25% by 2030 vs 2022
1.1% reduction of scope 3 CO₂e emissions 
since 2022
To meet our near- and long-term Science Based Targets, ABB will:
•  Expand supplier engagement beyond Tier 1 to achieve deeper value 
chain emissions reductions;
•  Increase sourcing of low-carbon materials and product circularity;
•  Accelerate grid decarbonization using ABB technologies.
Ambition to avoid 600 megatons CO₂e emissions 
throughout lifetime of products sold from 2022 to 20302
285 mt total avoided CO₂e emissions 
since 2022
We preserve resources
Send zero waste to landfill while reducing waste genera-
tion by 20303
5.3% of total waste sent to landfill
Further reduce our total waste sent to landfill.
Achieve 80% alignment score for product-based revenues 
with the ABB Circularity Framework by 20304
27% alignment score for product-based 
revenues
Continue to align our product portfolio to ABB’s 
Circularity Framework.
We promote social progress
Zero life-changing events for our employees and contrac-
tors, measured in absolute number of serious incidents 
and fatalities
0 fatalities and 5 serious incidents
Continue to strengthen our health and safety performance, reducing 
events with potential for serious harm to employees and contractors.
Increase proportion of women in senior management5 
roles to 25% by 20306
22.6% women in senior management roles
Continue to increase the proportion of women in ABB’s se-
nior management.
Achieve a top-tier7 employee engagement score
80/100 employee engagement score
Maintain and improve our top-tier engagement score.
At least 80% of supply spending in focus countries8 cov-
ered by Sustainable Supply Base Management (SSBM) 
by 2030
Continue enhancing human rights due diligence across our value chain.
At least 80% of spending on high-risk suppliers9 in focus 
countries covered by SSBM by 2025
80%
Continue enhancing human rights due diligence across our value chain.
Ambition to expand programs for community 
engagement
$9.4 mn donated and 6,000 person-days 
volunteered
Continue strengthening governance around the community engage-
ment program and expand its impact.
1.	 EPS growth rates are 
computed using un-
rounded amounts.
2.	 Avoided emissions status is 
cumulative for 2022–2025.
3.	 Waste from demolition and 
construction are excluded 
from the target; waste sent to 
incineration without energy 
recovery is included. In 2025, 
the calculation of the KPI was 
refined to include hazardous 
waste sent to landfill or in-
cineration, which was previ-
ously excluded.
4.	 Product-based revenues are, 
by default, non-service-related 
third-party revenues from 
ABB-owned products, exclud-
ing systems, internal sales, 
and non-promoted brands. 
Exclusions follow documented 
company guidelines.
5.	 At ABB, senior managers 
are defined as employees 
in Hay grade 1–7, including 
Division Presidents.
6.	 This target relates to coun-
tries where policies legally 
permit and to the extent that 
it does not conflict with any 
applicable laws, where ABB 
operates, therefore 13 percent 
of total senior management is 
not included in the disclosure.
7.	 We define “top-tier” as per-
formance within the Viva Glint 
Global top 25 percent bench-
mark and assume consistent 
participation across business 
areas, regions, and roles.
8.	 Current focus countries are 
Brazil, Bulgaria, China, Egypt, 
India, Malaysia, Mexico, Peru, 
Saudi Arabia, South Africa, 
Thailand, Tunisia, and Türkiye.
9.	 High-risk suppliers are sup-
pliers who supply ABB with 
goods or services for which 
there is a high occupational 
health and safety, environ-
mental, or social risk.
10
Introduction  |  Targets & ambitions
Value creation
Governance

1.	 The 2025 Supplier 
Engagement score will be 
available in March 2026.
2.	 The use by ABB Ltd of any 
MSCI ESG Research LLC or 
its affiliates (“MSCI”) data, 
and the use of MSCI logos, 
trademarks, service marks, 
or index names herein, do not 
constitute a sponsorship, en-
dorsement, recommendation, 
or promotion of ABB Ltd by 
MSCI. MSCI services and data 
are the property of MSCI or 
its information providers, and 
are provided ‘as-is’ and with-
out warranty. MSCI names 
and Logos are trademarks or 
service marks of MSCI.
3.	 Copyright ©2025 
Sustainalytics, a Morningstar 
company. All rights reserved. 
This publication includes 
information and data pro-
vided by Sustainalytics and/
or its content providers. 
Information provided by 
Sustainalytics is not directed 
to or intended for use or 
distribution to India-based 
clients or users and its dis-
tribution to Indian resident 
individuals or entities is not 
permitted. Morningstar/
Sustainalytics accepts no 
responsibility or liability 
whatsoever for the actions of 
third parties in this respect. 
Use of such data is subject 
to conditions available at 
https://www.sustainalytics.
com/legal-disclaimers
 
Find out more about our 
sustainability ratings on our 
website ABB ESG ratings.
CDP CLIMATE
A
CDP WATER
A
CDP SUPPLIER  
ENGAGEMENT1
A
ECOVADIS
Platinum 84/100
ISS ESG  
CORPORATE
Prime status B
MSCI ESG2
AAA
S&P GLOBAL  
CSA SCORE
58/100
SUSTAINALYTICS  
ESG RISK3
17.4
ABB sustainability ratings 2025
11
Introduction  |  Targets & ambitions
Value creation
Governance

IMPORTANT MILESTONES IN 2025
From four to three 
business areas
With the announced sale of our Robotics division, ABB now operates with 
three business areas: Electrification, Motion, and Automation (formerly Pro-
cess Automation). The business areas benefit from shared sales and technol-
ogy opportunities. The Machine Automation division, previously a part of the 
former Robotics & Discrete Automation business area has been integrated into 
the Automation business area.
Planned divestment of ABB’s 
Robotics division
ABB has signed an agreement to divest its Robotics division to SoftBank 
Group Corp. for an enterprise value of $5.375 billion. The transaction is subject 
to regulatory approvals and further customary closing conditions and is ex-
pected to close in mid-to-late 2026.
79% reduction in emissions
ABB is well on track to reach the mid-term target of 80% reduction in own 
scope 1+2 GHG emissions by 2030, so that we are now forecasting a reduction 
of 86 percent for 2030 versus a 2019 baseline. 
Share buybacks
ABB launched a new share buyback program of up to $1.5 billion for capital 
reduction purposes. It was run from February 10, 2025 until January 28, 2026, 
with a total of 20,744,831 shares repurchased for a total value of approximately 
$1.3 billion.
New Board Director
At the Annual General Meeting in Zurich, Switzerland, shareholders approved 
the election of Claudia Nemat as a new Board Director, replacing Lars Förberg 
who did not stand for re-election.
12
Introduction  |  Important milestones in 2025
Value creation
Governance

Appointment of new CFO
ABB appointed Christian Nilsson as CFO and member of the Executive Com-
mittee effective February 1, 2026. He succeeded Timo Ihamuotila, who decided 
to step down from the Executive Committee at the same time and leave ABB at 
the end of 2026 ensuring a smooth transition. 
Acquisition of Siemens’ Wiring 
Accessories business in China
ABB completed the acquisition of Siemens’ Wiring Accessories business in 
China, which generated over $150 million in revenue in 2024. The acquisition 
enhances ABB’s portfolio to address the growing demand for safe, reliable, 
and energy-efficient building solutions as it provides access to an expansive 
distributor network, extending ABB’s reach across China and Southeast Asia, 
and further into the retail market.
Acquisition of the power 
electronics business of 
Gamesa Electric
ABB announced the completion of the acquisition of the power electronics 
business of Gamesa Electric in Spain. With annual revenues of approximately 
€145 million for the fiscal year that ended September 30, 2025, the acquisi-
tion expands ABB’s market reach and strengthens its position in the growing 
high-power renewable power conversion sector. 
13
Introduction  |  Important milestones in 2025
Value creation
Governance

CEO Morten Wierod reflects on a record year for ABB and 
explains why he believes the best is still to come.
Morten, what were the highlights 
of 2025?
In addition to building on our strong 
customer relationships, I was pleased 
to see our all time high results. We 
had a record year for orders, revenues, 
profits and cash flow. We also reached 
our record-high Operational EBITA 
margin and best-in-class ROCE (return 
on capital employed) and raised our 
targets for both metrics. We also made 
strong progress toward our sustainabil-
ity targets. We achieved “A” scores for 
climate and water in the 2025 rankings 
of non-profit organization CDP, and 
were recognized by TIME magazine 
as one of the world’s most sustain-
able companies.
On the innovation side, we launched our 
next-generation SACE Emax 3 air circuit 
breaker to improve power stability in 
critical infrastructure, like data centers, 
factories, hospitals, and airports. We 
also announced a long-term collabora-
tion with NVIDIA to accelerate critical, 
high-efficiency and scalable power tech-
nologies for the next generation of 800V 
DC data centers. We are working with 
several industry partners to develop 
new distribution technologies that can 
deliver enough power to data centers 
running AI applications.
On the M&A side, we completed the 
acquisitions of Gamesa Electric’s power 
electronics business in Spain and of 
Siemens’ Wiring Accessories business 
in China. These broaden our market 
reach and expand our offerings in key 
segments, such as renewable power 
conversion and smart buildings. We also 
acquired innovative technology compa-
nies Sensorfact, which helps SMEs use 
AI to lower cost and increase energy 
efficiency, and Brightloop, a specialist in 
advanced power converters for off-road 
industrial vehicles and marine vessels.
Our strong results show we have the 
right people, the right operating model, 
and are strongly positioned in the 
“right” markets.
In 2025, you announced plans to sell 
ABB’s Robotics business to SoftBank 
Group. How is that progressing?
Very well. ABB Robotics will benefit from 
the combination of its leading technol-
ogy and deep industry expertise with 
SoftBank’s state-of-the-art capabilities 
in AI, robotics and next-generation com-
puting. Together, the two companies will 
be in a strong position to shape the new 
era in AI-based robotics and expand as a 
technology leader in this field.
We expect the transaction to close in 
mid-to-late 2026, once the regulatory 
approvals and further customary closing 
conditions have been completed.
Since the fourth quarter of 2025, Robot-
ics has been reported as discontinued 
operations and has been operating as 
a standalone division within ABB. Our 
Machine Automation division, which was 
previously within the Robotics & Discrete 
Automation business area, has been 
integrated into our Automation (formerly 
Process Automation) business area.
With the planned separation of Robotics, 
we have three business areas – Electri-
fication, Motion, and Automation – with 
strong sales and technology synergies. 
Our Automation business serves as a 
brand and technology bridge between 
end-user segments and ABB, which ben-
efits our Electrification and Motion busi-
nesses. Automation enjoys a competitive 
advantage because it is the only supplier 
with direct access to both electrification 
and motion products and solutions. 
With these shared opportunities, we are 
well-positioned to drive higher growth 
and margins.
Have US tariffs and higher materials 
prices had an impact on ABB’s business?
The impact of US tariffs has been man-
ageable, thanks to our “local-for-local” 
strategy of sourcing and producing 
close to our customers. Where we were 
CEO Q&A
14
Introduction  |  CEO Q&A
Value creation
Governance

affected by tariffs and higher mate-
rials prices, we were able to balance 
our market position while defending 
our profitability. Despite the economic 
uncertainty, demand for our solutions 
remained strong, especially in sectors 
like data centers, marine, ports, utilities 
and infrastructure such as tunnels and 
airports. We are continuing to invest 
to increase localization. In the US, 
close to 80 percent of our revenues are 
generated from locally made products, 
solutions, and services, with around 
15 percent sourced from Europe; in 
China, it is around 85 percent and in Eu-
rope, 95 percent.
In November, you announced an update 
to your financial targets. What makes 
you optimistic about ABB’s prospects?
We continue to challenge ourselves to 
improve and have raised our Opera-
tional EBITA margin and ROCE targets. 
We drive performance through a sharp 
focus on our decentralized ABB Way 
operating model, active portfolio man-
agement, and strong exposure to robust 
markets for electrification, energy effi-
ciency, and automation.
With our reshaped business portfolio, 
following the announced divestment 
of our Robotics division, I am very 
confident we can do even better as we 
build on the ABB Way and our leader-
ship positions in electrification and 
automation. We are well-positioned at 
the center of key megatrends, such as 
rising energy demand and the energy 
transition, which are driving demand for 
our solutions across the power, indus-
try, transport, data center, and build-
ing segments.
You mentioned strong demand from 
data centers and in power generation. 
Do you expect this to continue in the 
years ahead?
Yes, we are seeing rising demand for 
energy, and especially electricity, driven 
by the massive power demands of AI. 
This is driving major investment in 
grid expansion and modernization. At 
the same time, AI is rapidly being inte-
grated into digital tools and activities, 
which is driving demand for more data 
center capacity. We already see this in 
search engines, which increasingly show 
AI-generated responses rather than just 
lists of links.
How big an impact is AI having on 
your business?
AI is having a significant, albeit indirect, 
impact due to strong demand for data 
center and power infrastructure. It is 
also becoming an increasingly important 
driver of value creation and productivity. 
Around half of our global R&D workforce 
is now focused on software, AI, and 
digital, and we have a large and growing 
portfolio of AI-enabled solutions.
Our decentralized approach empowers 
our businesses to innovate close to our 
customers. For example, our Genix™ 
Industrial IoT and AI Suite, developed 
with Microsoft, uses analytical and 
generative AI to interpret real-time data 
from multiple sources to help industrial 
customers optimize their operations.
Internally, AI tools are also helping our 
people work better and faster. Our 
GenAI specification reading tool, for 
example, uses AI to read lengthy spec-
ifications for motor applications and 
propose a motor design that fulfills the 
requirements. Another example is our 
GenAI-powered coding assistant Github 
Copilot, which halves the time it takes to 
code and delivers better results.
You’ve been investing in startups and 
smaller acquisitions. Are you open to 
larger deals?
Our M&A strategy focuses on emerging 
high-growth industries and addressing 
market and technology gaps. Our target 
is to add an annual average of 1–2 per-
cent of revenues through acquired 
growth. We still have work to do to 
fully embed M&A into our performance 
culture, but we are open to larger ac-
quisitions provided they align with our 
company’s purpose and create share-
holder value.
Are you still planning an IPO for your 
E-mobility business?
The turnaround of the business is 
progressing. Our solutions portfolio is 
now focused and modular, and we’re 
seeing encouraging order growth. The 
IPO will take place only once the busi-
ness is ready and market conditions 
are favorable.
Looking ahead, what can we expect 
from ABB in 2026?
We expect demand for our solutions 
to remain strong; the key megatrends 
driving our business – in particular, the 
growing demand for electricity and 
the accelerating energy transition – are 
not going away. We also expect to see 
greater levels of automation and indus-
trial operations becoming increasingly 
autonomous. So, a continued robust 
market environment coupled with our 
strong order backlog will support our 
revenues. Combined with our internal 
finetuning, such as driving the ABB Way 
deeper into the organization, we expect 
another record year for ABB.
We welcomed Christian Nilsson as our 
new Chief Financial Officer and member 
of the Executive Committee as of Febru-
ary 1, 2026, succeeding Timo Ihamuotila. 
I want to thank Timo for his outstanding 
contribution to the success of our com-
pany as CFO for the past nine years.
On behalf of the Executive Committee, 
I want to thank the entire ABB team 
for their commitment and strong per-
formance and to thank our customers, 
partners, suppliers, and shareholders for 
their continued trust and support. We 
look forward to continuing to help our 
customers outrun – leaner and cleaner. 
15
Introduction  |  CEO Q&A
Value creation
Governance

We enable a more sustainable 
and resource-efficient future 
with our technology leadership in 
electrification and automation.
ABOUT ABB
Our purpose
Our purpose is the reason why we are in business. 
It sits at the heart of our decentralized operating 
model, the ABB Way. Each of our three business areas 
– Electrification, Motion, and Automation – governs 
their respective divisions, ensuring that we collectively 
deliver on this purpose through our technology 
leadership in electrification and automation.
At the same time, it is our 16 operating divisions in the 
three business areas that are closest to our customers. 
As a result, they have full ownership and accountability 
for their strategies, performance, and resources in 
order to provide the best possible service to our 
customers. Additionally, we report our E-mobility in 
“Corporate and Other” and our Robotics division in 
discontinued operations due to its announced sale.
Our business areas and divisions 
16
Introduction  |  About ABB
Value creation
Governance

ELECTRIFICATION
A global technology leader enabling the efficient and re-
liable distribution of electricity from source to socket.
•	 Digital and connected innovations for low- and 
medium-voltage electrical infrastructure, including 
modular substations, distribution automation, power 
protection, wiring accessories, switchgear, electric ve-
hicle (EV) infrastructure, enclosures, cabling, sensing, 
and control
•	 Services to improve reliability, availability, predictabil-
ity, and sustainability of electrical systems
MOTION
The largest supplier of drives and electrical motors glob-
ally, is at the core of accelerating a more productive and 
sustainable future.
•	 A complete range of electrical motors, drives, genera-
tors, and services, as well as integrated digital power-
train solutions
•	 Energy-efficient, decarbonizing and industrial circular 
solutions to empower a low-carbon future
•	 Services of a wide range of automation applications 
in transportation, infrastructure, and the discrete and 
process industries
AUTOMATION
Enables the operation of large and complex industrial 
infrastructures that deliver essential resources, from en-
ergy and materials to water and manufactured goods.
•	 A wide array of automation, electrification, and digital 
solutions for process, hybrid, and maritime industries, 
including industry-specific integrated control and 
software, machine and factory automation technolo-
gies, as well as measurement and analytics solutions 
and services 
$17.4 bn
$8.1 bn
$8.2 bn
Revenues
Divisions
•	 Distribution Solutions
•	 Smart Power
•	 Smart Buildings
•	 Installation Products
•	 Service
•	 Drive Products
•	 Motion High Power
•	 Motion Services
•	 NEMA Motors
•	 IEC LV Motors
•	 Traction
•	 Energy Industries
•	 Process Industries
•	 Marine & Ports
•	 Measurement & Analytics
•	 Machine Automation
No. 2
No. 2
No. 1
Global market position
Employees
~53,400
~26,300
~22,900
17
Introduction  |  About ABB
Value creation
Governance

E-MOBILITY
ABB’s E-mobility division, formerly part of the Electrification 
business area, has been an independent business and separate 
operating segment since January 2023. It is reported in “Corpo-
rate and Other”. ABB E-mobility enables a more sustainable and 
efficient mobility future as a global leader in electric vehicle (EV) 
charging solutions. ABB E-mobility is a partner of choice for the 
world’s leading EV OEMs, EV charging network operators, and 
fleet companies. It offers the widest portfolio of EV charging 
solutions from high-power chargers for destination charging 
to the highway stations of the future, solutions for the electri-
fication of fleets, and charging for electric buses and trucks. 
The E-mobility team has a workforce of approximately 1,300, 
revenues of approximately $460 million and reported an Oper-
ational EBITA of -$148 million, which was negatively affected by 
low volumes.
ROBOTICS
With the announcement of the signed agreement to divest our 
Robotics division, its results of operations are presented as 
discontinued operations in our Financial Report. Robotics pro-
vides industrial and collaborative robots, autonomous mobile 
robotics, mapping, and navigation solutions, robotic solutions, 
field services, spare parts, and digital services. In 2025, revenues 
of the ABB Robotics division were $2.3 billion. For more informa-
tion on Robotics performance in 2025, please refer to the Dis-
continued Operations section in our Financial Report 2025 and 
the Appendix “Effects from discontinued operations on selected 
datapoints” in the Sustainability Statement 2025. 
18
Introduction  |  About ABB
Value creation
Governance

At ABB, we have around 110,000 employ-
ees located in more than 100 countries. 
Our people run what runs the world. Our 
expertise is why customers come to us 
with their biggest challenges. Together, 
we push the boundaries of technology 
to drive performance and find new ways 
of working that benefit our customers, 
partners, and society.
Looking at the world around us and the 
challenges we face, we focus on our 
values and being true to them. We have 
four core values at ABB: Courage, Care, 
Curiosity and Collaboration. These values 
guide our actions, as well as our inter-
actions with each other, our customers, 
partners, and society as a whole.
We serve customers in more than 100 
countries across three regions: Europe, 
the Americas, and Asia, Middle East, 
and Africa (AMEA). Our global reach is 
supported by manufacturing in around 
40 countries, service operations in over 
100 countries, and a network of more 
than 6,000 channel partners.
Our geographical presence
Our people
The Americas
~$12.4 bn
revenues
~37%
of Group
revenues
AMEA
~$9.4 bn 
revenues
~28%
of Group 
revenues
>160
manufacturing sites globally
Europe
~$11.4 bn
revenues
~34%
of Group 
revenues
Revenues
by region
Europe
52,400
AMEA
31,800
The Americas
27,700
Employees
 by region
19
Introduction  |  About ABB
Value creation
Governance

Speak openly
We engage in constructive discussions 
and share our thoughts and concerns, 
even when the topics are uncomfortable. 
Challenge ourselves
We push ourselves to aim higher, dare to 
try new things, and take smart risks. 
 
Act with integrity
We do what is right for our stakeholders, 
customers, society, and environment. 
We are not afraid of making diffi-
cult decisions.
Care for ourselves
We foster our mental, physical, and emo-
tional wellbeing, and prioritize safety, 
even under pressure. 
Care for each other
We regularly check in on each other, show 
empathy, compassion, and offer support. 
 
Care for customers
We seek to understand our customers’ 
needs, build strong relationships, and 
create value together.
Stay open-minded
We are receptive to new ideas, invite cre-
ative perspectives, and ask for feedback. 
 
Go beyond
We ask ‘what if?’, step back to look at the 
big picture from several angles, and think 
one level up. 
Innovate
We experiment to find innovative solu-
tions that help our customers thrive, and 
we learn throughout the process.
Co-create
We listen to understand, share knowl-
edge, adopt and adapt ideas from others, 
and celebrate joint successes. 
Build trust
We demonstrate authenticity, inclusivity, 
and vulnerability to build trust, knowing 
that we work better together. 
Connect the dots
We identify and resolve critical collabora-
tion points between teams to maximize 
value for our customers.
Our values and behaviors
Courage
Care
Curiosity
Collaboration
At ABB we:
20
Introduction  |  About ABB
Value creation
Governance

The ABB Way is our operating model, ensuring that the business is 
stronger as a group than as separate entities. With our purpose at 
its core, the ABB Way establishes a decentralized business model, 
lays the foundations for our people and culture, supports a robust 
governance and strong culture of integrity, and enables us to build 
and protect our brand and reputation.
BUSINESS MODEL
ABB’s business model shapes how we operate 
in a decentralized structure, drive best-in-class 
performance, allocate capital, and manage our 
portfolio. Accountability, transparency, and 
speed in decision-making and execution are 
enabled by this model, which is built on the 
principle that operating decisions are best made 
within the divisions and close to customers. 
Establishing select common processes and a 
strong performance management system enable 
alignment with the Group’s strategic priorities, 
as well as financial and sustainability targets, 
while also enabling collaboration across divi-
sions to better serve our customers. For more 
on how our decentralized model creates stake-
holder value, see the Value Creation chapter.
ABB WAY
For further information, 
please see the Value 
Creation chapter.
ABB Way: Our operating model
ABB
purpose
P
E
O
P
L
E
 
&
 
C
U
L
T
U
R
E
B
R
A
N
D
G
O
V
E
R
N
A
N
C
E
B
U
S
I
N
E
S
S
 
M
O
D
E
L
• Decentralized setup
• Performance management
• Capital allocation
• Portfolio management
• Code of Conduct
• Internal control & compliance
• Risk management
• Policies & procedures
• Values & behaviors
• People
• Leadership
• Positioning
• Reputation
21
Introduction  |  ABB Way
Value creation
Governance

PEOPLE AND CULTURE
We aim to attract and retain the best 
people, while cultivating a “high perfor-
mance – high integrity” culture. Through 
our values of Courage, Care, Curiosity, 
and Collaboration, we aim to create a 
safe, fair, and inclusive working environ-
ment in which our people can succeed 
and develop, while always ensuring com-
pliance with safety standards, internal 
controls and our Code of Conduct. As we 
push the boundaries of technology and 
deliver on our purpose, we also create 
opportunities for our people to focus 
on their own development, integrating 
learning into their work and fulfilling 
their career potential at ABB.
GOVERNANCE
ABB’s robust governance framework 
fosters accountability, transparency, 
speed in execution, and responsible risk 
management. Our framework protects 
our license to operate through compre-
hensive internal controls and our Code of 
Conduct. This framework also supports 
the responsible adoption of technolog-
ical advancements, such as artificial 
intelligence (AI), and helps us integrate 
integrity throughout our value chain.
BRAND
The ABB brand is an expression of our 
company’s purpose, our values, and long 
history of innovation. Today, the iconic 
red ABB logo has become a sign of trust, 
quality, and premium value. We foster our 
reputation as a reliable business partner, 
technology leader, and preferred choice 
for our stakeholders.
How industries run is critical. From 
energy, power, and mining to building, 
transport, manufacturing, and more 
– businesses need to operate at high 
performance, while becoming more pro-
ductive, efficient, and sustainable to out-
perform. Or as we say at ABB, they need 
to “outrun”, leaner and cleaner.
 
22
Introduction  |  ABB Way
Value creation
Governance

At ABB, our commitment to creating sustainable long-term 
shareholder value remains a top priority. We aim to deliver 
long-term value to shareholders through disciplined capital 
allocation, leading financial performance, and a clear 
commitment to sustainable growth.
SHARE PERFORMANCE
In 2025, the price of ABB Ltd shares 
listed on the SIX Swiss Exchange (SIX) 
increased 21 percent, while the Swiss 
Market Index (SMI) rose 14 percent. The 
price of ABB Ltd shares on the Nasdaq 
Stockholm increased 16 percent, com-
pared to the OMX Stockholm 30 Index, 
which also rose 16 percent. The price of 
ABB Ltd American Depositary Shares 
traded on the US over-the-counter mar-
ket increased 38 percent. Total share-
holder return (TSR, including dividends) 
of ABB Ltd shares listed at SIX was 
23 percent during 2025. Going forward, 
our financial target framework and our 
shareholder-friendly capital allocation 
principles point towards double-digit 
TSR through the cycle.
As of December 31, 2025, approximately 
30 percent of shares issued were held 
in Switzerland, 28 percent in the United 
States, and 23 percent in Sweden. The 
ten largest individual shareholders ac-
counted for approximately 41 percent 
of the share capital on the same date. 
On December 31, 2025, 75 percent of 
the shareholder base was made up 
of institutional investors, with retail 
investors reaching 19 percent. On De-
cember 31, 2025, members of the Group 
Executive Committee owned a total 
of 658,165 shares in ABB. Members of 
the Board of Directors owned a total of 
516,398 shares in ABB. Total ownership of 
ABB shares held by the Group Executive 
Committee and the Board of Directors 
corresponds to less than one percent of 
capital and voting rights.
ABB SHARE PERFORMANCE
Distribution of shareholdings by country
30%
Switzerland
28%
United States
23%
Sweden
9%
Continental Europe
8%
UK and Ireland
2%
Rest of World
Breakdown of shareholders by type
75%
Institutional investors
19%
Retail positions
5%
Miscellaneous
1%
Company-related holders
23
Introduction  |  ABB share performance
Value creation
Governance

1.	 Proposed by the Board of 
Directors and subject to ap-
proval by shareholders at the 
Annual General Meeting on 
March 19, 2026.
2.	 Calculation based on 
weighted-average number of 
shares outstanding.
3.	 Calculation based on the 
number of shares outstand-
ing at December 31, 2025.
4.	 Dividend per share (converted 
to US dollars at year-end 
exchange rates) divided by 
basic earnings per share.
KEY DATA ON SHARE PERFORMANCE 
FY 2025 
FY 2024
FY 2023
Dividend per share (CHF) 
0.941
0.90
0.87
Votes per share
1
1
1
Basic earnings per share (USD)2
2.59
2.13
2.02
Total ABB stockholders’ equity per share (USD)3
8.85
7.84
7.24
Dividend payout ratio (%)4
46%
47%
51 %
Weighted-average number of shares outstanding (in millions)
1,827
1,844
1,855
Zurich share performance 2025
Average daily traded number of shares: 2.67 million
Stockholm share performance 2025
Average daily traded number of shares: 0.60 million
ABB
Swiss Market Index Rebased
 
30
32
34
36
38
40
42
44
46
48
50
52
54
56
58
60
62
Jan 2025
Feb 2025
Mar 2025
Apr 2025
May 2025
Jun 2025
Jul 2025
Aug 2025
Sep 2025
Oct 2025
Nov 2025
Dec 2025
Low: 39.14
High: 59.96
High: 708.2
Year end:
59.22
CHF
Source: FactSet.
ABB
OMX Stockholm 30 Index Rebased
300
340
380
420
460
500
540
580
620
660
740
700
Jan 2025
Feb 2025
Mar 2025
Apr 2025
May 2025
Jun 2025
Jul 2025
Aug 2025
Sep 2025
Oct 2025
Nov 2025
Dec 2025
SEK
Year end:
687.8
Low: 459.7
24
Introduction  |  ABB share performance
Value creation
Governance

DIVIDEND AND SHARE 
BUYBACK
The 2024 declared dividend amounted to 
$1,867 million. For the year ended Decem-
ber 31, 2025, ABB’s Board of Directors 
has proposed to distribute a dividend 
to shareholders of CHF 0.94 per share. 
This is subject to approval by sharehold-
ers at the Annual General Meeting on 
March 19, 2026. The proposal is in line 
with our dividend policy to pay a rising, 
sustainable dividend per share over time.
In February 2025, we launched a share 
buyback program of up to $1.5 billion 
that ran until the end of January 2026. 
Together with the prior share buyback 
program, which ran from April 2024 to 
January 2025, we repurchased a com-
bined value of $1.3 billion during the 
year 2025. ABB announced a new share 
buyback of up to $2.0 billion on Janu-
ary 29, 2026, as we plan to continue our 
share buybacks for the full-year 2026 in 
line with our capital allocation priorities.
CHF
%
0.6
0.8
1.0
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
1
2
3
4
5
2025
2024
2023
2022
2021
2020
2019
2018
2017
2016
Dividend per share (in CHF)¹
Dividend yield (in %)²
Dividend per share and dividend yield
2016–2025
>$30 billion returned to shareholders 
over last 10 years
$17 billion dividends
$13 billion buybacks
25
Introduction  |  ABB share performance
Value creation
Governance

VALUE CREATION
02
Our business environment	
27
Decentralized business model	
32
Our strategic priorities	
36
Risks & opportunities	
42
We deliver leading financial performance 	
44
We enable a low-carbon society 	
54
We preserve resources 	
66
We promote social progress 	
74

ABB is well positioned to capitalize on key global 
megatrends that support our long-term growth 
ambitions. The expansion of the energy system, 
due to the growing demand for electricity and the 
energy transition, is driving substantial investment 
in power generation, including the integration of 
renewables, grid modernization, energy efficiency, 
and industrial decarbonization.
At the same time, rapid advances in digitalization, 
AI and evolving supply chains are increasing 
demand for ABB’s electrification and automation 
solutions. These trends are directly aligned with 
our purpose: to enable sustainability and resource 
efficiency through our customer offerings.
OUR BUSINESS ENVIRONMENT
27
Introduction
Value creation  |  Our business environment
Governance

ENERGY EXPANSION AND 
TRANSITION
The demand for electricity is expected to 
double by 20501, driven by the electrifi-cation 
of transport, industry, and buildings, including 
the rapid expansion of data centers and AI 
which is significantly increasing electric-ity use. 
Customers are increasingly investing in 
electrification as it often reduces both 
operating costs and capital expenditures. In 
addition, electrification will be essential for 
achieving net-zero emissions. Decarbonization 
has started, and electrification can accelerate 
a shift from fossil fuels to renewable energy 
sources. Our technologies play a key role in 
both supporting the energy transition and 
meeting rising energy demand, helping us 
contribute to progress and innovation in these 
essential sectors.
1.	 IEA World Energy Outlook 
2025, Current Policies 
Scenario (CPS)
2. International Energy Agency 
(IEA)
3.	 Management estimate
Buildings
Industry
Transport
+95%
+42%
+521%
2024
2050
2024–2035
2015–2024
Energy demand
3.0%
12
57
95
40
49
2
1.3%
3.0%
1.3%
2010
2050
2040
2030
2020
Adv. economies
Other emerging/developing markets
China
India
Electricity demand
10%
15%
20%
25%
30%
35%
40%
45%
2050
2045
2040
2035
2024
2023
2015
2010
Electricity – the power of the future 
—
Global electricity demand outpacing energy demand 
(CAGR in %, IEA CPS)
—
Share of electricity in final energy consumption across regions (%, IEA CPS)
—
Global electricity demand in selected industries
(EJ, IEA CPS)
28
Introduction
Value creation  |  Our business environment
Governance

ENERGY EXPANSION AND 
INVESTMENTS IN ELECTRICAL 
INFRASTRUCTURE
Demand for power is rising steeply. In 2024, 
global energy demand grew by 2.2 percent, 
while electricity consumption increased by 
4.3 percent, adding 1,080 TWh2, driven by the 
electrification of transport, expansion of data 
centers and AI infrastructure, as well as in-
creased cooling needs in buildings.
Today’s electricity grid faces challenges, both 
in meeting growing energy demand as well 
as enabling a transition to cleaner sources. 
The grid, originally designed for steady fossil 
power generation, requires upgrades in tech-
nology, as well as additions to energy storage 
and smarter management, to handle the de-
centralized and intermittent nature of renew-
able power generation. According to the IEA, 
while clean energy adoption is accelerating, 
global energy supply is only in the beginning 
of being decarbonized. As renewables become 
a core part of the energy mix, substantial 
investment in grid infrastructure will be es-
sential to ensure reliability, flexibility, and 
long-term sustainability.
ABB’s electrification, automation, and digita-
lization technologies enable a smarter, more 
flexible energy network. With approximately 
16 percent of offerings directly tied to renew-
able and conventional power generation and 
distribution, we are well positioned to support 
these investments and upgrades to current 
infrastructure, delivering on our purpose to 
enable a more sustainable future.
21,431
24,212
29,851
31,109
44,961
50,325
55,271
59,248
2010
2050
2045
2040
2035
2024
2023
2015
Fossil
Other renewables and hydrogen
Bioenergy
Wind + solar PV
Nuclear
Hydro
Electricity as a power source
—
Global electricity generation by source, in TWh
We need more
energy expansion
Regardless of the energy source, 
the demand for electricity is 
expected to double by 2050.
We need clean
energy transition
The world has not yet started to 
decarbonize. Similar amount of 
electricity generated through fossil 
sources as in 2018/19.
We need optimization
energy efficiency
Optimize consumption of 
electricity already available.
Source: IEA World Energy Outlook 2025, Current Policies Scenario. 
29
Introduction
Value creation  |  Our business environment
Governance

DECARBONIZATION OF 
INDUSTRIES
Industry currently accounts for approxi-
mately 25 percent2 of global greenhouse 
gas (GHG) emissions, making it a critical 
focus for decarbonization. Electrification 
is a key pathway for decarbonization, as 
it often results in a lower total cost of 
ownership compared to fossil-based sys-
tems. For example, electric motors and 
variable speed drives offer higher energy 
efficiency, reduced maintenance, and 
fewer mechanical components, resulting 
in lower operating costs over time. This 
cost advantage, especially when paired 
with renewable electricity, strengthens 
the business case for electrification. 
While electrification leads the way, com-
plementary solutions such as hydrogen 
and carbon capture remain essential for 
decarbonizing harder-to-abate industrial 
segments. With more than half of our 
revenues linked to the electrification and 
automation of industry, ABB’s offering 
supports industries in their transition 
toward electrification and cleaner energy 
sources. Our technologies support pro-
duction optimization processes, electrify 
industrial machinery, and increase the 
energy efficiency of motor-driven appli-
cations, helping industries decarbonize.
ENERGY EFFICIENCY
Investments in energy efficiency are 
expected to rise due to growing energy 
demand, energy security concerns, and 
the need to reduce operational costs.
Our energy-efficient solutions – such as 
variable speed drives, high-efficiency 
motors, and energy management sys-
tems – are designed to optimize energy 
use, reduce waste, and improve opera-
tional performance across industries. As 
a result, we enable customers to reduce 
operating costs by reducing energy 
consumption and shrinking their car-
bon footprint.
418
356
382
2026–30
2031–40
2041–50
45%*
of the world’s electricity is converted by 
industrial electric motors into motion.
The combination of high-efficiency 
motors and drives can help reduce 
total global electricity consumption by 
up to 10%.*
* Management estimate
+18%
Energy efficiency
Increase in average annual investment, $ in billions
Source: IEA 2025
30
Introduction
Value creation  |  Our business environment
Governance

DIGITALIZATION AND AI
The accelerating adoption of AI and 
digitalization is reshaping industrial 
operations and infrastructure. The global 
data center market is projected to grow 
at a double-digit rate in the mid-term3, 
with power capacity potentially reaching 
over 200 GW, almost four times the 2023 
capacity. This surge in demand is speed-
ing up the move to more energy-efficient 
and scalable data centers to support the 
growing data needs for agile, data-driven 
operations and demand for electrical 
infrastructure in adjacent segments, 
such as metals & mining, utilities, and 
semiconductors. AI-driven data centers 
require significantly more power, leading 
to higher demand for medium-voltage 
solutions. As a leader in this area, ABB 
offers a robust portfolio for data cen-
ters, addressing customer challenges 
regarding growing power and direct 
grid access needs, and mission-critical 
power access.
AI is integral to our evolution, as we con-
tinuously seek opportunities to create 
customer value and drive improvements 
in our operations. In our decentralized 
operating model, we share best prac-
tices through our AI council. The council 
also monitors progress of initial ideas, 
turning into one of the approximately 
250 ongoing AI projects, and ultimately 
into an implemented solution. Our solu-
tions use analytical and generative AI to 
improve internal efficiency and enhance 
our offering to customers. For example, 
we use AI to generate insights from large 
sets of unstructured data, optimize pro-
cesses and the utilization of assets, allow 
automation of new skills, and simplify 
the interaction between humans and 
machines. A prime example is Genix™ 
Copilot, which integrates generative 
AI to contextualize industrial data to 
deliver real-time insights for improved 
efficiency, predictive maintenance, and 
sustainability optimization. Genix™ 
Copilot translates the potential of gener-
ative AI into practical, actionable insights 
for field engineers, functional special-
ists, and industry executives – support-
ing collaborative decision-making and 
boosting productivity. In addition, the 
Genix™ Agentic Automation framework 
enables real-time monitoring, contextual 
interpretation, and autonomous ac-
tions, while ABB’s human-in-the-loop, 
semi-autonomous approach ensures 
users remain in control throughout the 
process. These capabilities, alongside 
digital twins and AI-driven process 
control, enable customers to boost 
efficiency, lower operating costs, and 
accelerate their digital transition.
EVOLVING SUPPLY CHAINS
Recent policy shifts by governments are 
accelerating the move toward regional-
ization and localization. Rising tariffs, 
protectionist trade measures, and na-
tional industrial policies are prompting 
companies to reconfigure global supply 
chains for greater resilience and control. 
Businesses are increasingly investing in 
localized production, supplier diversi-
fication, and advanced technologies to 
mitigate risk and maintain competitive-
ness in a fragmented global landscape. 
For ABB, our decentralized business 
model enables us to support customers 
with our localized electrification and au-
tomation products and solutions offer-
ing. At ABB, we have a strong tradition of 
local-for-local manufacturing, enabling 
us to stay close to customers. Although 
we are a global company, we take a local 
approach to our offering, localizing 
R&D and tailoring our product portfolio 
to the local market, where conditions 
allow. Approximately 95 percent3 of our 
revenues in Europe are covered with local 
production. In China, it is 85 percent3 and 
in the United States close to 80 percent3.
Future data centers at 4× power demand 
220 GW
data center
capacity
2030
2023
55 GW
data center
capacity
30 kW
peak rack density
in current architectures
200 MW
facility considered
normal today
1 MW
AI GPU* peak rack
density in 2030
1.5 GW
AI factories
normal in 2030
× 1
US nuclear plant
× 30
=
× 4
× 1,000
=
* Graphics Processing Unit
Source: McKinsey, Bank of 
America, Morgan Stanley, 
Jefferies, J.P. Morgan
31
Introduction
Value creation  |  Our business environment
Governance

DECENTRALIZED BUSINESS MODEL
ABB continues to evolve into a more agile and efficient 
company. Our decentralized business model fosters 
accountability, transparency, and speed in decision making 
and execution. This is founded on the belief that decisions 
are best made in the divisions, close to customers, 
implementing select common processes, and a strong 
performance management system.
DECENTRALIZED SETUP
We operate in a decentralized setup 
where our divisions represent the high-
est operational level, empowered with 
full ownership and accountability for 
their strategies, performance, and re-
sources. This fosters greater speed and 
accountability, driving improved opera-
tional performance.
Our divisions are organized into busi-
ness areas that govern and set strategic 
mandates. These mandates guide oper-
ating decisions, prioritizing stability and 
profitability before growth. Meanwhile, 
our corporate functions are designed to 
be lean and effective, providing essential 
frameworks for the business model, 
performance, portfolio management, 
and capital allocation. This decentralized 
model allows us to combine the speed 
and agility of a small company with the 
brand strength, capital resources, and 
global reach of a large business.
Our ABB Way decentralized business model
Accountability, transparency and speed
Business Model
Governance
People & Culture
Brand
ABB Purpose
FUNDAMENTAL PRINCIPLES OF OUR DECENTRALIZED BUSINESS MODEL
Performance management
A robust system tracks performance with 
standard KPIs, enabling fast, informed 
decision-making. Each division receives 
a mandate (stability, profitability, or 
growth) with clear strategic priorities and 
ƗƜƑƓƜƢƗƤƓţơƣƞƞƝƠƢƓƒƢƏƠƕƓƢơ
Collaboration and synergies
People are encouraged to collaborate 
where synergies exist and where they 
benefit the business.
Decisions close to customers
Divisions have full accountability for 
their businesses, including R&D, CapEx, 
strategy, and M&A, enabling decisions 
to be made close to customers.
Select common processes
Our policies and procedures are core, 
common, or distinct. Core policies are 
set by the Executive Committee and 
apply across ABB, common policies cover 
shared areas across divisions or BAs 
for efficiency or customer needs, and 
distinct policies are business-specific.
32
Introduction
Value creation  |  Decentralized business model
Governance

PERFORMANCE MANAGEMENT
At ABB, we strive for continuous improvement, 
building on a systematic and transparent perfor-
mance management framework. The increased 
accountability and speed of our decentralized 
setup is balanced by the transparency of our 
robust performance management system.
We translate our financial and sustainability 
priorities into ambitious targets. ABB’s financial 
and sustainability targets are developed bottom 
up and are underpinned by detailed plans from 
each division, ensuring they are realistic, ac-
countable, and aligned with our strategic pri-
orities. Furthermore, our remuneration system 
encourages the mantra of “smart leaders collab-
orate”, as our leaders are expected to generate 
synergies where it makes sense for the business.
Transparency through performance management system
Strategic mandates
• Transparent and systematic framework for evaluation
of performance vs. strategic mandates
• Sharper link between remuneration and delivery
on mandate
• Mandates continuously reviewed
Clear targets for continuous improvement
• 5% annual gross profit productivity target
• High-performance, high-integrity culture
Robust governance
• Monthly business reviews
- Financial results
- Sustainability
- Internal controls
- M&A
Financial data easily available to support 
business analysis
• Monthly scorecard system by division with
standardized KPIs
• Investing in systems to enhance data quality and
speed in analysis
33
Introduction
Value creation  |  Decentralized business model
Governance

DRIVING OPERATIONAL 
PERFORMANCE WITH 
STRATEGIC MANDATES
Each division operates under a clear strategic 
mandate that shapes its decision making. 
These mandates prioritize stability first, then 
profitability, and only then growth; they are 
directly tied to variable remuneration KPIs. 
While mandates are reviewed regularly, they 
are held for a minimum of one year to ensure 
strategic consistency. This clear and disciplined 
approach has enabled a successful shift; today, 
approximately 70 percent of revenues are under 
a growth mandate.
We continue to implement a strict focus on 
delivery by strategic mandate, which will 
support growth and continued profitability 
improvements. As divisions transition through 
ABB’s strategic mandates, we emphasize that 
growth and profitability are equally important 
but, based on a division’s mandate, different 
rates of improvement are expected. Divisions 
with best-in-class profitability are incentivized 
to grow faster while stronger profitability 
improvement is expected from divisions with a 
profitability mandate.
We are enhancing accountability even further 
by empowering business line leaders with 
strategic mandates and corresponding incen-
tives to improve operational performance. This 
approach will further improve accountability, 
transparency, and speed in the organization.
ABB’s decentralized business model 
New: Business lines
Divisions
Corporate
Business areas
• Reached full implementation of ABB Way performance 
accountability and strategic mandate for business lines 
after summer 2025
• ~70 business lines
• Majority of divisions have a mix of business line 
mandates; majority in growth, some in profitability
• Business line performance management owned
by business areas and divisions
• Restructure
• Transform offering/business model
Strategic mandates
Stability
01
• Improve margin/return
• Moderate investment in growth
• Select technology add-on acquisitions
Profitability
02
• Growth above market while maintaining 
profitability levels
• Invest strongly in organic growth
(e.g., digital, R&D, sales/service, capacity)
• Actively pursue acquisitions, including technology 
additions, growth in existing markets and 
penetration of new market segments
Growth
03
34
Introduction
Value creation  |  Decentralized business model
Governance

CAPITAL ALLOCATION
ABB’s capital allocation principles are 
determined by the corporate finance 
function and have enabled us to maintain 
a strong investment grade rating with 
a focus on profitable growth. We focus 
on funding organic growth through 
R&D and production capacity, followed 
by paying a rising and sustainable divi-
dend per share over time. Beyond that, 
we seek value-creating acquisitions to 
complement or expand our offering in 
high-growth segments, fill technology 
gaps, gain access to new geographies, 
and boost economies of scale. Our am-
bition is to deliver an average of 1–2 per-
cent annual growth through M&A. Lastly, 
our capital allocation priorities also state 
that we distribute any excess cash to our 
shareholders via share buybacks. 
1,800
2,000
2,200
2025
2024
2023
2022
2021
2020
Value-creating acquisitions
03
Returning additional cash to 
shareholders through share buybacks
04
02
Fund organic growth, R&D,
CapEx at attractive returns
01
Division-led R&D and CapEx:
• No. 1–2 market position – be customersʼ 
preferred problem solver
• High returns on capital
Rising, sustainable dividend
per share over time
Our ambition is to deliver an average 1–2 percent annual 
growth through M&A:
• Make M&A part of our ABB Way performance culture
• Pace has picked up but deal size remains small
• Maintain strong investment grade rating
0.7
0.8
0.9
1.0
2018 2019 2020 2021 2022 2023 2024 2025
Dividend per 
share (CHF)
Dividend payout 
ratio (%)
Shares 
outstanding at 
end of period 
(in millions)
0%
50%
100%
150%
35
Introduction
Value creation  |  Decentralized business model
Governance

OUR STRATEGIC PRIORITIES
Our strategic priorities guide decision making and 
resource allocation across our decentralized organization, 
ensuring alignment, consistency, and focus on long-term 
value creation. These priorities include striving for market 
and technology leadership, embedding sustainability 
in our processes and our value chain, as well as active 
portfolio management.
To achieve these priorities in a structured way, we leverage 
ABB’s six forms of capital according to the Integrated 
Reporting Framework – financial, manufactured, human, 
social and relationship, intellectual and natural capital – and 
describe how we do so in this report.
MARKET LEADERSHIP
Each of our divisions aims to hold a num-
ber one or two position in their market 
segment. We believe market leadership 
is critical, as it allows us to be cost ef-
fective in our markets and benefit from 
economies of scale. This, in turn, delivers 
strong profitability, which allows us to 
invest more in R&D to sustain our techno-
logical leadership. These investments in 
technology and manufacturing assets, as 
well as our deep application know-how, 
create customer value, allowing us to 
maintain our market-leading positions in 
electrification and automation. We are 
well invested, with our annual long-term 
CapEx of approximately $800 million, 
and we expect investments to remain 
fairly stable going forward.
01
Market 
leadership
02
Technology 
leadership
04 Active portfolio 
management
03
Embedding sustainability 
throughout our operations 
and value chain
ABB’s strategic priorities
36
Introduction
Value creation  |  Our strategic priorities
Governance

Business in
100+ countries
Factory footprint in
40+ countries
Service presence in
100+ countries
6,000+
channel partners
globally
Annual long-term 
CapEx of
~$800 mn
Customers
Business Area
Electrification
GLOBAL NO. 2
Business Area
Automation
GLOBAL NO. 2
Business Area
Motion
GLOBAL NO. 1
~65%*
~35%*
ABB
Electrification
Automation
The power of ABB – Three business areas with sales and technology synergies
Even Better Together
• Access ABB’s full offering directly through each 
business area and/or one point of contact through 
project management
• ∼$900 million of pull-through revenues
• Technology sharing between business areas, e.g. 
- Electrification’s SACE Air Circuit Breaker in 
Motion’s market leading drives.
- Motion’s electrical motors and drives in Azipod® 
propulsion from Automation. Vessels equipped 
with Azipod® propulsion use Motion’s 
generators and Electrification’s switchgear.
Smart People Collaborate
• Utilize full ABB scope to solve customers’ problems
• Account management with one lead point of 
contact, as needed by customer 
• Revenue split by business area contribution to the 
specific contract
• Scale benefits for parts of sourcing
• Selected R&D projects
• Internal collaboration by improved access to 
“communities of practice”
* Management estimate and % based on 2024 
third-party revenues
37
Introduction
Value creation  |  Our strategic priorities
Governance

TECHNOLOGY LEADERSHIP
Our approach to R&D
Technology and innovation are essential 
to our long‑term success, and we follow 
a customer‑centric approach by placing 
R&D responsibility within our divisions 
as they are closest to our customers. 
Innovation is fueled by deep application 
expertise, built through decades of pres-
ence in our core end markets and close 
relationships with customers.
We invest a significant share of our an-
nual revenues in R&D, aiming to maintain 
spending at 4.5 to 5 percent of revenues 
at the Group level. Since 2022, we have 
increased our absolute R&D investment 
by about 30 percent. Investment needs 
vary significantly across our divisions, 
with R&D spending ranging from 1 to 
10 percent of revenues depending on the 
strategic priorities and technological 
requirements of each business. This 
tailored approach ensures resources are 
allocated effectively to support innova-
tion, maintain market leadership, and 
drive growth across the group.
Digital solutions and AI
In line with our decentralized operat-
ing model, ABB’s digital strategy is 
customer-driven and business-led. We 
prioritize digital solutions that com-
plement and/or are integrated into our 
products and control systems to help 
customers optimize energy use, asset 
performance, and workforce productivity.
R&D highlights 2025
$1.3 bn
R&D investment
4.0%
R&D as % of revenues 
invested in 2025
>30
countries with 
local R&D facilities
~7,800
R&D employees
~50%
of R&D employees 
focused on digital and 
software development
700
900
1,100
1,300
1,500
Future
2025
2024
2023
2022
%
$ in millions
Venture investments ($ mn)
Non-order related R&D ($ mn*)
R&D and venture investments
as % of revenues
R&D investments as %
of revenues
3.0
3.5
4.0
4.5
5.0
Future
2025
2024
2023
2022
* Non-order related R&D excluding 
completed divisional exits.
Increasing R&D spend towards target range of 4.5–5%
38
Introduction
Value creation  |  Our strategic priorities
Governance

Our products, services, and solutions 
increasingly feature embedded software, 
which is often the main source of differ-
entiation and value. We continue to focus 
on software and AI development as an 
important part of our innovation strategy, 
supported by the fact that approximately 
half of our R&D employees work on digital 
and software development.
This digitally enabled offering is comple-
mented by advanced software applica-
tions that are designed to unlock greater 
value from industrial data, enabling 
predictive maintenance, real-time opti-
mization, and autonomous operations. 
Solutions like the Genix™ Industrial IoT and 
AI Suite integrate data across operational, 
engineering, and IT systems to deliver 
actionable insights, driving significant im-
provements in energy optimization across 
critical processes in energy-intensive in-
dustries, improving asset reliability, reduc-
ing unplanned downtime, and minimizing 
troubleshooting by shop floor engineers 
across critical assets and processes. These 
offerings have been developed primarily 
through organic innovation and are com-
plemented by targeted technology venture 
investments and selective bolt-on acqui-
sitions. We focus on software that creates 
clear synergies with our core strengths in 
electrification and automation.
Strategic partnerships, business 
ventures, and M&A 
Our R&D teams collaborate with universi-
ties and research institutions worldwide, 
including ETH Zurich (Switzerland), 
Imperial College London (UK), Indian 
Institutes of Technology (India), and 
Karlsruhe Institute of Technology 
(Germany). These partnerships help to 
build research networks and foster inno-
vative technologies which we potentially 
invest in and sometimes acquire. Our 
collaborations also include long-term 
strategic relationships that support 
recruitment and training of new talent.
To enhance innovation and gain speed, 
our divisions partner with other leading 
companies which have complementary 
competencies. We also invest in and col-
laborate with startups around the world 
through our venture capital arm, ABB 
Technology Ventures, and our startup 
collaboration hub, SynerLeap.
In 2025, we invested in five new ventures 
and made 12 follow-on investments 
totaling approximately $28 million. The 
investments were driven by ABB’s divi-
sions and focused primarily on digital 
capabilities, including AI that will create 
synergies with our digitally enabled 
products and services. For example, ABB 
acquired a minority stake in Edgecom 
Energy, a Toronto-based startup which is 
pioneering generative AI-powered energy 
management solutions. The aim is to 
accelerate the development of scalable 
AI-enabled tools that help industrial 
customers optimize energy use, reduce 
costs, and support the energy transition.
M&A is another way we ensure our tech-
nology is market leading. Through the ac-
quisition of Sensorfact, we expanded our 
digital energy management capabilities 
with AI-powered plug-and-play solutions 
that help industrial customers monitor 
and optimize machine-level energy con-
sumption. The acquisition of BrightLoop 
added advanced, modular DC/DC power 
conversion technology to ABB’s portfolio, 
supporting electrification in off-highway 
vehicles, marine propulsion, and hydro-
gen mobility applications.
EMBEDDING 
SUSTAINABILITY 
THROUGHOUT OUR 
OPERATIONS AND 
VALUE CHAIN
Sustainability at ABB is embedded across 
all levels of the organization through 
the ABB Way operating model. In our 
decentralized structure, each division 
is accountable for integrating sustain-
ability into its strategy, operations, 
and customer offerings. Governance is 
supported by a clear framework; strate-
gic direction is set by the Sustainability 
Council, overseen by the Board of 
Directors and Executive Committee and 
implemented by the divisions with full 
ownership. This ensures that sustainabil-
ity is a core part of how we create value 
– aligned with our purpose and linked to 
performance and reward. Our long-term 
performance plan requires each division 
to provide a five-year forecast for finan-
cial and sustainability targets simultane-
ously, ensuring the financing of the latter 
is secured. Executive compensation is 
linked to sustainability targets through 
our annual and long-term incentive plans. 
This integration of sustainability through-
out our business enables ABB to drive 
progress on emissions reduction, re-
source efficiency, and social impact while 
remaining agile and customer centric.
With our Sustainability Agenda, we ac-
tively contribute to a more sustainable 
world, leading by example in our own 
operations and partnering with custom-
ers and suppliers to enable a low-carbon 
society, preserve resources, and promote 
social progress. These three pillars of our 
sustainability agenda are underpinned by 
our commitment to a culture of integrity 
and transparency across our value chain.
Based on our strategic priorities and 
decentralized operating model – and 
given our exposure to global megatrends 
– we are well positioned to capture rising 
demand for electrification and auto-
mation solutions. This strong growth 
profile is matched by our continued focus 
on improving operational and financial 
performance, which together serve as 
the foundation for our financial and 
sustainability targets to drive long-term 
value creation.
39
Introduction
Value creation  |  Our strategic priorities
Governance

ACTIVE PORTFOLIO 
MANAGEMENT
Active portfolio management remains 
a key part of our performance culture 
and is integrated into the responsibili-
ties of division management teams. We 
conduct systematic portfolio reviews 
at the division and business-line level. 
These reviews guide decisions on where 
to grow organically – through CapEx and 
R&D – and where to grow inorganically. 
Additionally, the reviews help identify 
businesses from which to divest when 
they no longer align with our strategic or 
financial criteria.
Inorganic growth includes acquisitions 
that enhance scale, expand market ac-
cess, or fill technology gaps. Only divi-
sions with a growth mandate are active 
in acquisitions to outgrow the market, 
while all divisions may pursue smaller, 
technology-driven acquisitions. Each 
division is responsible for building its 
own pipeline of potential acquisitions, 
ensuring alignment with its strategic 
and financial goals. In addition to 
division-led inorganic growth, business 
areas and corporate strategy regularly 
evaluate larger M&A opportunities that 
cut across or beyond ABB’s current divi-
sion structure.
Scoring system
with ~20 KPIs
Bolt-on deals to add 
revenues of 1–2%, 
average through cycle
Small-to-mid-size 
M&A led by divisions 
Large deals led by 
Corporate and 
business areas
Making M&A part of our ABB Way performance culture
Strategic fit and future value creation is key
• Lead large deals or adding new division
• Support due diligence
Corporate/Business area
Division
• Lead bolt-on deals within divisions
• Build and maintain bolt-on deal pipeline
• Lead due diligence and transactions for 
bolt-on deals
• Responsible for integration
Aiming for:
• Strong gross margin potential
• Solid track record for comparable growth
• No EPC business
• Filling technology and geographical gaps
• Economies of scale
• Adjacent markets and segments
All M&A to be in line with:
• ABB Purpose
• ABB Way operating model
• Embedded software and Al
• Maintaining strong investment 
grade rating
Make M&A part of the ABB Way
performance culture
40
Introduction
Value creation  |  Our strategic priorities
Governance

0
4,000
8,000
2025
2024
2023
2022
2021
0%
10%
20%
2025
2024
2023
2022
2021
20,000
28,000
36,000
2025
2024
2023
2022
2021
20,000
29,000
38,000
2025
2024
2023
2022
2021
0.00
1.50
3.00
2025
2024
2023
2022
2021
0
2,500
5,000
2025
2024
2023
2022
2021
10%
20%
30%
2025
2024
2023
2022
ABB
ABB’s customer value proposition is built on
ABB is moving in the right direction, achieving new all-time highs
Raising our margin and return targets
We can do even better
Orders
USD, million
Revenues
USD, million
Operational EBITA & 
Margin
Technology leadership
• Leading electrical and 
automation engineering 
know-how
• Embedded software
• Applied Al in products
and solutions
Domain expertise
• Know the industry at least 
as well as customer
• 140 years of legacy
• Strong distribution network
• Local-for-local footprint
Basic EPS
continuing operations 
USD
Free Cash Flow
USD, million
ROCE
2021
2022
2024
2023
2025
2021
2022
2024
2023
2025
2021
2022
2024
2023
2025
2021
2022
2024
2023
2025
2021
2022
2024
2023
2025
Next wave in the ABB Way 
operating model – increasing 
operational accountability and 
transparency
The beauty of mixing – 
stricter focus on performance 
delivery by mandate
Sustained focus on 
continuous improvement and 
an annual 5% internal gross 
profit productivity target
The power of ABB – three 
business areas with sales and 
technology synergies
Operational leverage on 
expected growth in robust 
external markets
M&A bolt-ons part of ABB Way 
performance culture
Growth through 
economic cycle
Comparable
5%–7% avg
Excluding 
FX impacts, 
acquisitions and 
divestments
Acquired
1%–2% average
UPDATED
Operational 
EBITA margin: 
annual
18%–22%
Business area 
target ranges
EL 
22%–26%
MO 18%–22%
AU 
14%–18%
UPDATED
ROCE
annual
>20%
UPDATED
FCF conversion 
to net income 
annual >95%
EPS growth (basic), average 
through economic cycle
At least high single digit %
2022
2024
2023
2025
41
Introduction
Value creation  |  Our strategic priorities
Governance

RISKS & OPPORTUNITIES
For more information on our 
ERM process, please refer to 
the Governance chapter.
For more information on 
our material impacts, risks, 
and opportunities based 
on our Double Materiality 
Assessment (DMA), including 
disclosures on climate-related 
risks and opportunities, 
see the ABB Sustainability 
Statement 2025.
Proactive and strategic management of risks is an integral part 
of how we do business. Our risk management framework enables 
early identification and assessment of risks and ensures effective 
mitigation and management of their effects across all levels of ABB. 
At the same time, we look to turn risks into potential opportunities. 
This approach supports the creation and protection of value for ABB, 
our stakeholders, and society.
ENTERPRISE RISK MANAGEMENT
At ABB, risks and opportunities often intersect, 
underscoring our commitment to both risk 
mitigation and value creation. Many of our solu-
tions also directly address global challenges, 
where the potential opportunities for ABB often 
outweigh the risks. For example, our strongest 
potential opportunities lie in strategic product 
innovation designed to address evolving cus-
tomer needs and support societal priorities, 
particularly relating to the global energy tran-
sition and the shift to electrification. By mon-
itoring key economic and social megatrends, 
we remain well positioned to capture emerging 
opportunities and deliver sustainable value.
Based on the results of our enterprise risk 
management (ERM) process, the top enterprise 
risk categories facing ABB in 2025 are depicted 
on the following page.
SUSTAINABILITY RISKS AND 
OPPORTUNITIES
ABB’s Double Materiality Assessment (DMA) 
presents our material sustainability matters. 
This allows us to better understand our im-
pacts, risks, and opportunities, focusing on 
both our own operations and our value chain.
ABB faces both risks and opportunities re-
lated to its material sustainability matters. 
For example, climate change poses risks to 
our infrastructure, operations, and employee 
safety. Acting on climate change provides 
opportunities, including securing market 
leadership, strengthening our reputation, and 
attracting talent. This helps to increase produc-
tivity and reduce carbon emissions, as well as 
reducing our own carbon footprint and costs 
through resource-efficient practices and tech-
nologies. Having a deep understanding of our 
sustainability risks and opportunities enables 
us to manage them proactively and drive pos-
itive outcomes for ABB, our stakeholders, and 
society as a whole.
42
Introduction
Value creation  |  Risks & opportunities
Governance

Top five enterprise risk categories 2025
EXAMPLES OF REPORTED RISKS
EXAMPLES OF RISK RESPONSES
Cyber security incidents
Potential cyber incidents involving ABB or third parties 
due to a global increase in sophisticated cyber attacks, 
AI-powered threats, high interconnectivity across the sup-
ply chain, and increasing process digitalization. 
•	 Continuous cyber vulnerability scanning and cyber de-
fense tools to identify and prevent cyber attacks.
•	 Onboarding of IT assets to global security solutions and 
cyber security training and awareness campaigns.
Geopolitical instability
Increased geopolitical tensions globally resulting in trade 
restrictions, protectionism, global technology decoupling, 
raw material price increases and regulatory compliance 
challenges.
•	 Evaluation and monitoring of exposure to and depen-
dency on high-risk geographical markets.
•	 Developing alternative supply chains for raw materials and 
dual sourcing strategies for key components.
Market dynamics and competition 
Market shifts and disruptive technologies reshaping 
value chains, new market players entering key segments, 
aggressive competitive strategies, and concentration in 
specific segments.
•	 Review of portfolio strategy and price positioning in key 
markets and reinforcement of sales capability in growing 
segments.
•	 Continuous monitoring of market developments and 
further advance region-specific product strategies.
Talent and capabilities
Attraction and retention of skilled talent in highly competi-
tive labor markets, demographic shifts in the workforce and 
keeping pace with demand for new competencies, and skills 
to support evolving business models and technologies.
•	 Defining key competencies required to execute strategy 
and identifying competency gaps across geographies and 
segments.
•	 Developing structured capability and competence build-
ing programs aligned to future workforce needs.
Integrity behavior
Potential breach of laws and regulations and ABB’s code of 
conduct resulting in reputational and brand value damage, 
trade sanctions, regulatory fines and penalties, and eco-
nomic loss. 
•	 Group-wide integrity training and awareness cam-
paign and continuous improvement of internal control 
framework.
•	 Active monitoring of legal and regulatory landscape with 
targeted actions to meet compliance.
43
Introduction
Value creation  |  Risks & opportunities
Governance

ABB delivered another year of record-level 
operational performance and improved 
on virtually all lines of the Income 
Statement. We have come a long way in 
improving our operational performance, 
but still see continued opportunities to 
enhance performance and deliver even 
stronger outcomes. 
­— 
VALUE CREATION
WE DELIVER LEADING 
FINANCIAL PERFORMANCE 
2025 HIGHLIGHTS 
Order intake reached 
$36.8 bn 
 
+15% comparable¹
Revenues reached  
$33.2 bn 
 
+7% comparable¹
Operational EBITA of  
$6,314 mn 
 
increasing 13% versus the prior year
Free Cash Flow1 of 
$4.6 bn  
 
improving from last year’s high level 
Operational EBITA Margin1 of
19.0% 
 
+80 bps versus prior year
44
Introduction
Value creation  |  We deliver leading financial performance
Governance

Orders and revenues 
ORDERS
In 2025, total orders rose sharply by 17 percent 
(15 percent comparable1) to reach a record-high 
level of $36.8 billion. Orders improved across 
all business areas. With electricity increas-
ingly becoming the key power source, the 
Electrification business area saw strong order 
growth of 14 percent (13 percent comparable1). 
Growth was seen across most end markets, 
with high demand from data centers, utilities 
and land based infrastructure. The buildings 
segment also improved, driven by commercial 
buildings, mainly in the United States. Orders in 
the Motion business area increased 8 percent 
(6 percent comparable¹). Customers continue 
to strive to make their operations more en-
ergy efficient by investing in high-standard 
electrical motors and drives. Growth was 
supported by the project and systems-related 
businesses and service. Short-cycle businesses 
also increased, albeit from a low comparable. 
Positive developments were seen in commer-
cial building HVAC, food & beverage, as well 
as water & wastewater. Strong performance 
in the power generation segment was partly 
offset by declines in heavy, process-related 
industries, such as chemicals, metals and pulp 
& paper. Orders in the Automation business 
area increased sharply compared to the prior 
year by 33 percent (30 percent comparable1). 
The strong order growth was supported by the 
booking of several exceptionally large orders 
which contributed approximately $1.2 billion. 
Excluding the impact of these large orders, the 
underlying market activity level remained ro-
bust with customers looking for ABB to support 
them on their journey towards improving the 
safety, productivity and sustainability of their 
operations. Customer activity was strongest in 
marine and ports. Strength was also noted in 
conventional power generation, while the more 
traditional process industries of chemicals and 
metals & mining were more subdued.
1.	 For a reconciliation of alterna-
tive performance measures, 
see “supplemental reconcili-
ations and definitions” in the 
Q4 2025 Financial Information 
booklet available on the 
Investor Relations website.
2.	 For additional information 
and analysis about individual 
business area revenues and 
order performance, refer 
to the relevant sections of 
the business analysis in our 
Financial Report 2025.
Comparable growth %
Orders
20,000
26,000
32,000
38,000
2025
2024
2023
2022
2021
0
10
20
2025
2024
2023
2022
2021
%
Orders
$ in millions
45
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Value creation  |  We deliver leading financial performance
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In 2025, orders increased 26 percent (26 per-
cent comparable1) in the Americas, which was 
supported by the booking of several of the 
exceptionally large orders mentioned above. 
Excluding this impact, the underlying demand 
remained strong in the Americas region, with 
particular strength noted in the United States. 
Orders also increased in Canada and Brazil, 
partially offset by a decline in Mexico. In Europe, 
orders increased 16 percent (11 percent com-
parable1). Orders were higher across the ma-
jority of our larger markets including Germany, 
Sweden, Finland, and the United Kingdom while 
they declined in the Netherlands and Belgium. 
In Asia, Middle East and Africa, orders increased 
7 percent (7 percent comparable1). Orders im-
proved in China from a low comparable, which 
more than offset declines in other markets such 
as Saudi Arabia, Australia and Japan.
REVENUES
In 2025, revenues increased by 9 percent (7 per-
cent comparable1), driven by volume growth in 
short-cycle, service, and strong conversion of 
the order backlog in the project and systems 
businesses, with some additional support 
from positive price. Revenues improved in all 
business areas led by Electrification, which in-
creased by 12 percent (11 percent comparable1), 
driven by both good momentum in short-cycle, 
as well as strong execution from the high order 
backlog related to the medium voltage and 
power protection offering. Strong conversion of 
our order backlog into revenue also supported 
growth of 5 percent (3 percent comparable1) in 
the Automation business area. Revenues in the 
Motion business area increased by 6 percent 
(4 percent comparable1), driven by higher vol-
umes in short-cycle and long-cycle divisions, 
as well as additional support from positive 
impacts from pricing.
ORDERS BY REGION
Change
($ in millions, unless otherwise indicated)
FY 2025
FY 2024
US$
Comparable1
Europe
12,169
10,518
16%
11%
The Americas
14,537
11,575
26%
26%
Asia, Middle East and Africa
10,059
9,389
7%
7%
ABB Group
36,765
31,482
17%
15%
Comparable growth %
Revenues
20,000
25,000
30,000
35,000
2025
2024
2023
2022
2021
0
5
10
15
$ in millions
%
Revenues
46
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REVENUES BY REGION
Change
($ in millions, unless otherwise indicated)
FY 2025
FY 2024
US$
Comparable1
Europe
11,407
10,138
13%
7%
The Americas
12,424
11,370
9%
10%
Asia, Middle East and Africa
9,389
9,075
3%
3%
ABB Group
33,220
30,583
9%
7%
 
GROWTH
FY 2025
FY 2025
Change year-on-year
Orders
Revenues
Comparable
15%
7%
FX
2%
2%
Portfolio changes
0%
0%
Total
17%
9%
47
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GROSS PROFIT
Gross profit increased by 14 percent (12 percent 
in constant currency¹) to $13,640 million in 
2025, resulting in a gross margin improvement 
of 190 basis points to 41.1 percent. Gross profit 
improved in all three business areas, driven 
primarily by higher volumes with support from 
positive pricing, as well as savings and effi-
ciency measures which combined more than 
offset labor and tariff-related inflation.
INCOME FROM OPERATIONS
Income from operations amounted to 
$6,047 million, significantly up 28 percent 
year-on-year, resulting in a margin of 18.2 per-
cent. The increase was mainly driven by the 
positive impacts from improved operational 
business performance, with further support 
from foreign exchange timing differences, while 
the prior year was also negatively impacted by 
fair value adjustments of assets and liabilities 
held for sale and equity investments.
OPERATIONAL EBITA
Operational EBITA increased by 13 percent to 
$6,314 million. The higher result was due to the 
improved business performance more than 
offsetting higher expenses linked to Corporate 
and Other. Moreover, an operational net gain 
of approximately $140 million relating to a real 
estate sale in Corporate and Other had a posi-
tive impact. The Operational EBITA margin im-
proved by 80 basis points to 19.0 percent with 
the main drivers being operating leverage on 
higher volumes, positive pricing and improved 
operational efficiency. Corporate and other 
Operational EBITA amounted to -$499 million. 
This includes a loss of $148 million attributed to 
the E-mobility business and Stranded costs of 
$123 million linked to the ongoing divestment of 
the Robotics business.
1.	 Constant currency (not ad-
justed for portfolio changes).
2.	 For a reconciliation of alterna-
tive performance measures, 
see “supplemental reconcili-
ations and definitions” in the 
Q4 2025 Financial Information 
booklet available on the 
Investor Relations website.
Earnings 
$ in millions
Gross profit
5,000
7,500
10,000
12,500
15,000
2025
2024
2023
2022
2021
25
34
43
2025
2024
2023
2022
2021
Gross margin %
%
Gross profit and gross margin
Operational EBITA margin %
Operational EBITA
Income from operations
0
2,200
4,400
6,600
2025
2024
2023
2022
2021
5
10
15
20
2025
2024
2023
2022
2021
$ in millions
Income from operations and 
Operational EBITA
%
48
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NET FINANCE AND NON- 
OPERATIONAL PENSION 
CREDITS
In 2025, we continued to generate net fi-
nance income which declined by $15 mil-
lion to $117 million. The year-on-year 
decrease was driven by slightly higher 
interest and finance expenses, primarily 
due to interest expense related to income 
taxes, while interest and dividend income 
remained stable. Non-operational pen-
sion credits decreased by $1 million to 
$55 million compared to the prior year.
INCOME TAX
In 2025, the effective tax rate increased 
to 25.2 percent from 24.3 percent in 
2024. The effective tax rate in 2025 was 
higher, primarily due to a net benefit 
of $72 million from a partial reversal of 
an uncertain tax position related to the 
reassessment of certain tax risks in 2024.
NET INCOME AND EARNINGS 
PER SHARE
Net income attributable to ABB was 
$4,734 million and increased by 20 per-
cent. Basic earnings per share were 
$2.59 and increased by 21 percent. The 
improvement was driven by higher op-
erational performance, as well as lower 
adverse impacts from non-operational 
items than in 2024, as discussed above. 
0
1.00
2.00
3.00
2025
2024
2023
2022
2021
Basic EPS
$ per share
49
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TRADE NET WORKING CAPITAL
Trade net working capital1 amounted to 
$4,059 million, up slightly year-on-year from 
$3,967 million. The increase was primarily 
driven by impacts from changes in foreign 
exchange rates which more than offset the 
reduction of inventories and higher trade pay-
ables, in local currencies. The average trade net 
working capital as a percentage of revenues1 
was 13.0 percent, a reduction from 14.3 percent 
one year ago.
CAPITAL EXPENDITURES
Purchases of property, plant, equipment, and 
intangible assets for continuiing operations 
amounted to $1,001 million in 2025, compared 
with $799 million in the same period last year. 
For ABB Group, the total cash outflow on a com-
bined basis amounted to $1,099 million, higher 
than last year’s $845 million.
CASH FLOWS
In 2025, cash flows from operating activities 
generated net cash of $5,469 million, up from 
$4,675 million in 2024, driven by stronger 
earnings and a reduction in net working capital 
compared to the prior year. Two out of three 
business areas reported improved cash flows 
from operations. Free cash flow (FCF)1 in-
creased by $629 million to $4,566 million, with 
an FCF conversion to net income1 of 96 percent.
1.	 For a reconciliation of alterna-
tive performance measures, 
see “supplemental reconcili-
ations and definitions” in the 
Q4 2025 Financial Information 
booklet available on the 
Investor Relations website.
RETURN ON CAPITAL EMPLOYED
Return on Capital Employed (ROCE)1 increased 
by 150 basis points from 23.8 percent to 
25.3 percent in 2025. The main driver of the 
improvement was higher Operational EBITA 
compared with 2024.
Balance Sheet
Target range >20%
ROCE
8
12
16
20
24
28
2025
2024
2023
2022
%
Return on capital employed 
(ROCE)
% of net income
Free cash flow
0
1
2
3
4
5
2025
2024
2023
2022
2021
0
100
200
300
2025
2024
2023
2022
2021
$ in billions
Free cash flow and 
conversion rate
%
50
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NET DEBT
During 2025, our net debt increased $403 mil-
lion to a net debt position of $1,683 million. 
In 2025, we generated free cash flows of 
$4,566 million. This was mostly offset by 
amounts for purchases of treasury shares of 
$1,499 million, including $1,328 million relating 
to the announced buybacks of our shares, as 
well as $1,907 million for the payment of the 
dividend as we continued to return cash to our 
shareholders. We made payments related to 
acquisitions totaling $752 million. Additionally, 
the effect of exchange rate movements in-
creased net debt by approximately $700 million.
($ in millions, unless otherwise indicated)
December 31
2025
2024
Short-term debt and current maturities of long-term debt
475 
292 
Long-term debt
7,829 
6,648 
Total debt
8,304 
6,940 
Cash and equivalents
4,640 
4,326 
Marketable securities and short-term investments
1,981 
1,334 
Cash and marketable securities
6,621 
5,660 
Net debt
1,683 
1,280 
Net debt/EBITDA ratio
Net debt
-1
0
1
2
3
2025
2024
2023
2022
2021
-0.4
0.0
0.4
0.8
1.2
$ in billions
Net debt
51
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KEY FIGURES
($ in millions,  
unless otherwise indicated)
Change
FY 2025
FY 2024
US$
Comparable
Orders
18,757
16,422
14%
13%
Order backlog
9,438
7,506
26%
21%
Revenues
17,357
15,448
12%
11%
Operational EBITA
4,081
3,520
16%
  as % of operational revenues
23.5%
22.7%
+0.8 pts
Cash flow from operating activities
4,242
3,652
16%
No. of employees (FTE equiv.)
53,400
51,700
3%
KEY FIGURES
($ in millions,  
unless otherwise indicated)
Change
FY 2025
FY 2024
US$
Comparable
Orders
8,619
7,989
8%
6%
Order backlog
6,285
5,239
20%
8%
Revenues
8,247
7,787
6%
4%
Operational EBITA
1,600
1,518
5%
  as % of operational revenues
19.4%
19.4%
+0.0 pts
Cash flow from operating activities
1,621
1,776
-9%
No. of employees (FTE equiv.)
22,900
22,400
2%
ELECTRIFICATION
MOTION
Performance of business areas 
$ in millions
%
Operational EBITA
Income from operations
0
2,000
4,000
2025
2024
2023
2022
2021
$ in millions
Orders
Revenues
10,000
14,500
19,000
2025
2024
2023
2022
2021
10
15
20
25
2025
2024
2023
2022
2021
Operational EBITA margin %
Income from operations
and Operational EBITA
Orders and revenues
$ in millions
%
Operational EBITA margin %
Operational EBITA
Income from operations
0
2,000
4,000
2025
2024
2023
2022
2021
$ in millions
Orders
Revenues
5,000
7,000
9,000
2025
2024
2023
2022
2021
10
15
20
2025
2024
2023
2022
2021
Orders and revenues
Income from operations
and Operational EBITA
52
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KEY FIGURES
($ in millions,  
unless otherwise indicated)
Change
FY 2025
FY 2024
US$
Comparable
Orders
9,928
7,485
33%
30%
Order backlog
10,133
7,631
33%
23%
Revenues
8,084
7,692
5%
3%
Operational EBITA
1,132
1,080
5%
  as % of operational revenues
14.0%
14.0%
+0.0 pts
Cash flow from operating activities
1,528
1,231
24%
No. of employees (FTE equiv.)
26,300
25,800
2%
AUTOMATION
Looking to 2026, we will continue to further drive operational 
performance through increased accountability, transparency 
and speed, leveraging our ABB Way operating model. Moreover, 
we expect our three business areas to benefit from their lead-
ing positions in strong electrification and automation markets. 
We expect a positive book-to-bill and comparable revenue 
growth in the range of 6–9 percent. The Operational EBITA mar-
gin should slightly improve year-on-year, even when excluding 
the announced real estate gain in the first quarter of 2026. 
Additionally, we will utilize our larger share buyback program of 
up to $2 billion, as well as delivering on our policy of a sustain-
ably rising dividend per share over time.
OUTLOOK
$ in millions
%
Operational EBITA
Income from operations
0
750
1,500
2025
2024
2023
2022
2021
$ in millions
Orders
Revenues
5,000
7,500
10,000
2025
2024
2023
2022
2021
5
10
15
20
2025
2024
2023
2022
2021
Operational EBITA margin %
Orders and revenues
Income from operations
and Operational EBITA
53
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­— 
VALUE CREATION
WE ENABLE A LOW-CARBON SOCIETY 
Supporting the development of a low-carbon 
society is one of the most significant ways 
that ABB can contribute to environmental 
sustainability. Given our leadership in 
electrification and automation, ABB has 
a critical role in accelerating the energy 
transition, enabling energy security, energy 
efficiency and the addition of renewable 
energy to the grid while decarbonizing 
customer operations. Helping to solve these 
global challenges lies at the center of ABB’s 
purpose and value proposition. 
Progress towards 
2030 target
79% in scope 1 and 2 vs 2019 baseline, 
forecasting a 86% reduction by 2030.
98% of electricity 
sourced from 
renewables in 2025
Published our
Climate 
Transition Plan
in September 2025 
2025 HIGHLIGHTS
Awarded A in Water and in Climate
CDP Climate rating
The double A rating puts us in the top 1% of 
companies scored.
Energy efficiency 
movement – 
614 movers in total
Bringing together business, policymakers, and other 
stakeholders to promote energy efficiency through 
adoption of best practice, smarter investments, and 
enabling regulation
54
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As part of our Sustainability Agenda, ABB 
adopts a multi-pronged approach and is de-
carbonizing its operations and supply chain, 
while helping ABB customers reduce or avoid 
emissions through the products and services 
we provide.
ABB’s operational greenhouse gas emissions 
(scope 1 and 2) are generated from manufac-
turing, assembly, and logistics. These account 
for less than one percent of our total emissions 
while more than 99 percent come from our value 
chain, from raw material extraction to product 
end-of-life. The single greatest share of emis-
sions – around 97 percent – results from cus-
tomer use of our products (scope 3, category 11).
Our holistic approach to reducing ABB’s GHG 
emissions includes:
•	 Reducing GHG emissions in our own opera-
tions by implementing ABB’s technologies, 
driving energy efficiency, and increasing the 
proportion of renewable electricity in our 
operations;
•	 Working with suppliers to better understand 
and reduce GHG emissions in our supply chain;
•	 Helping customers cut emissions through the 
use of our products, solutions, and services.
Our Science Based Targets guide ABB’s ef-
forts to reduce scope 1, 2, and 3 emissions. 
Validated by the Science Based Targets 
Initiative (SBTi), ABB has committed to achieve 
the following targets:
ABB’s management and targets 
For further information 
please refer to the Climate 
Chapter in the Sustainability 
Statement 2025.
80%
reduction in scope 1
and 2 emissions
25%
reduction in scope 3
emissions
100%
reduction in scope 1
and 2 emissions
90%
reduction in scope 3
emissions
• Reduce scope 1 and 2 emissions by 80% 
from 2019 levels.
• Reduce scope 3 emissions by 25% from 
2022 levels. 
• Reduce scope 1 and 2 emissions
by 100%.
• Reduce scope 3 emissions by 90% 
from 2022 levels.
Near-term emissions targets 
by 2030
Net-zero targets for 2050
55
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While we acknowledge the challenges and 
transitional risks ahead, we remain com-
mitted to working closely with customers, 
suppliers, and others to develop innova-
tive solutions and build resilience. ABB’s 
value proposition centers on enabling 
customers to optimize, electrify, and de-
carbonize. In turn, this transformation of 
industry will enable the energy transition 
and development of a low-carbon society.
CLIMATE TRANSITION PLAN
In 2025, we published our updated 
Climate Transition Plan, ABB’s blueprint 
for reaching net-zero. The transition plan 
also includes our assessment of physical 
and transition risks with the most ma-
terial financial impact on ABB and maps 
these to our mitigation measures.
We believe that by reducing GHG emis-
sions across our business and value chain, 
and by enabling the shift to a low-carbon 
economy, ABB is well-positioned to 
remain resilient in the face of climate 
change. We will publish regular updates 
to track performance and progress.
In 2025, we allocated approximately 
$12 million in capital expenditures 
(CapEx) to climate mitigation projects 
across our building portfolio. These 
investments, developed together with 
ABB’s real estate teams, focus on scope 
1 and 2 emissions. Scope 3 initiatives are 
under evaluation for future inclusion.
GOVERNANCE
Accountability for emissions reduction 
is embedded at the division level, with 
oversight from the Executive Committee 
and the Board of Directors. Divisions are 
responsible for identifying and imple-
menting the most impactful initiatives 
across the value chain, from heat pumps 
in our sites and sourcing low-carbon 
materials for our products to providing 
high-efficiency solutions to our custom-
ers. Ultimate accountability for ABB’s 
climate targets rests with the Board of 
Directors. In 2025, the Governance and 
Nomination Committee approved our 
Climate Transition Plan as part of its 
wider role in reviewing and approving 
ABB’s Sustainability Agenda and targets.
We continue to embed ABB’s climate 
targets into the business. For example, 
scope 1, 2, and 3 emissions performance 
is now integrated into long-term perfor-
mance planning (LPP). In addition, man-
agement compensation in the annual and 
long-term incentive plan is tied directly 
to scope 1 and 2 climate performance 
in 2025.
We are 
working on 
the following 
measures:
Switch to 
renewable energy
Reduce 
fossil fuels
Electrify 
vehicle fleet
Reduce SF6
2025
-79%
-86%
2030
Decarbonization approach – our own operations
—
Scope 1 and 2 GHG reduction plan
700
600
ktCO₂e
500
400
300
200
100
0
2019 
baseline
The chart above shows the expected effects of each measure in 
reducing our emissions compared to our baseline year. The most 
impactful measure by far is the shift to renewable electricity. 
However, the other measures are important contributors to our 
emissions targets and will lead to significant changes in the way 
we run our operations.
Fossil fuel 
reduction
SF₆*
Fleet
Renewable 
electricity
RE100 
target
EV100 
target
2030 
forecast
*Sulfur hexafluoride
56
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Tackling operational emissions 
The term Mission to Zero™ refers to 
ABB’s journey to achieve net-zero emis-
sions in our own operations and operate 
more sustainably. In 2025, we achieved 
reductions of 79 percent versus 2019 for 
our scope 1 and 2 emissions. We continue 
to improve energy efficiency across our 
sites, while also increasing our share of 
renewable energy and electricity.
Using ABB technologies, our sites are 
increasing their energy efficiency and 
are decarbonizing process heat, phas-
ing out fossil fuels. Initiatives include 
implementing building automation 
and energy management systems, re-
placing fossil-fuel-based heating with 
high-efficiency HVAC and heat pump 
solutions, and installing on-site solar 
photovoltaic (PV).
In line with our efforts to accelerate re-
ductions in our scope 1 and 2 emissions, 
we have committed to three Climate 
Group initiatives that focus on renew-
able energy (RE100), fleet electrification 
(EV100), and energy efficiency and pro-
ductivity (Smart Energy Coalition).
We are also reducing operational use 
of sulfur hexafluoride (SF6), a potent 
greenhouse gas used in medium-voltage 
equipment. To do so, we are working 
to minimize use of SF6 in our products, 
prevent leakages in our operations, 
and introduce SF6-free products to 
the market.
As a result of the strong progress in re-
ducing our operational emissions we are 
now forecasting a reduction of 86 per-
cent for 2030 versus a 2019 baseline.
By the end of 2025, 37 ABB sites were 
recognized to meet Mission to Zero™ 
requirements.
Source 100% of ABB’s 
electricity consumption 
from renewable sources 
by 2030.
Progress: 98% of ABB’s electricity 
now comes from renewable 
sources, from both procurement 
and on-site generation.
Electrify ABB’s vehicle fleet 
by 2030.
Progress: 33% of 10,000+ cars are 
electric while 241 of ABB-owned sites 
have EV charging infrastructure.
Double ABB’s energy 
efficiency and implement 
energy management systems 
across all operations by 2030.
Progress: A 3.7% drop in energy 
consumption from 2024 to 2025 
despite revenue growth. This 
contributed to a 61% improvement 
in energy productivity since 2019. 
ABB’s commitments to reduce scope 1 and 2 emissions
33%
61%
98%
57
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Percentage of our 
electricity sourced 
from renewables
95%
98%
94%
81%
2023
2024
2025
2022
Share of electricity from renewable sources
Total energy used (GWh)
Total scope 1 and 2 GHG emissions (kilotons CO₂e)
0
500
1,000
1,500
2,000
0
200
400
600
800
2025
2024
2023
2022
2021
kilotons
CO₂e
GWh
Total energy used and total scope 1 and 2 GHG emissions
Percent of our electricity from renewables
58
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In 2025, although our scope 3 GHG emis-
sions increased compared to 2024, they 
are 1.1 percent lower compared to the 
baseline year of 2022, with key drivers be-
ing strong growth of orders and unit ship-
ments in parts of the business, as well 
as a shift in sales mix within our product 
portfolio. We follow the current GHG 
Protocol guidance under which 97 percent 
of our scope 3 emissions are downstream 
in the Use of Sold Products category. The 
guidance indicates that in many cases for 
ABB the full energy input to our products 
and not just the energy loss must be 
accounted for. Reducing emissions that 
occur downstream with customers during 
the use of ABB products requires decar-
bonization of the energy used throughout 
their lifetimes. The increase in scope 3 
emissions is a result of energy-intensive 
products used by customers powered 
by electricity which globally still often 
relies on significant use of fossil fuels. 
Advanced energy efficiency, electrifica-
tion and grid decarbonization are key 
drivers of the global energy transition. 
The sale of ABB products which support 
the integration of renewables into the 
grid for example, will in turn lead to 
reductions of our own scope 3 emissions 
in the long term. Our focus is on two key 
categories that account for 99 percent of 
value chain emissions:
•	 Supplier emissions (Purchased goods 
and services; category 1);
•	 Customer emissions (Use of sold prod-
ucts; category 11).
SUPPLIER EMISSIONS
Purchased goods and services (scope 3, 
category 1) are the largest source of 
upstream emissions, with more than half 
of these emissions coming from our top 
10 material groups.
To address this, ABB is working to in-
crease the proportion of low-carbon 
materials sourced, including steel, 
copper, aluminum, and plastics. While 
cost, availability, and price volatility 
present challenges, we are improving 
supplier data collection to better track 
material-related impacts.
Key actions include:
•	 Collaborating with suppliers and cus-
tomers on low-carbon material avail-
ability and use;
•	 Increasing availability of product car-
bon footprints (PCFs) from suppliers;
•	 Engaging suppliers on carbon reduction 
roadmaps through 2030.
CUSTOMER EMISSIONS
More than 97 percent of ABB’s value chain 
emissions result from customer use 
of our products (scope 3, category 11). 
Decarbonizing customer operations is 
therefore the most effective way we can 
contribute both to the energy transition 
and a low-carbon society.
Our products and services support cus-
tomers across numerous high-emitting 
sectors, including power, industry, build-
ings, and transport. We help these custom-
ers reduce emissions in three main ways:
•	 Supporting the decarboniza-
tion of electricity grids with 
innovative technologies;
•	 Improving energy efficiency in industry 
by working with customers to implement 
the most efficient products available;
•	 Developing new products to boost 
energy efficiency and help reduce 
carbon emissions.
ABB products support the energy tran-
sition by integrating renewables, elec-
trifying operations, and increasing grid 
efficiency. We also address emerging 
needs, such as the growing energy de-
mand of data centers, by delivering effi-
cient power solutions.
AVOIDED EMISSIONS
Our ambition is to enable customers to 
avoid 600 megatons of CO2e emissions 
through the lifetime of products sold be-
tween 2022 and 2030. Avoided emissions 
are calculated over the full product lifecy-
cle following strict guidance provided by 
the World Business Council of Sustainable 
Development (WBCSD).
For ABB products and services sold since 
2022, we have enabled customers to avoid 
285 megatons of CO2e emissions over 
the full product lifecycle. As customer 
use of ABB technologies grows, this can, 
in turn, increase our reported scope 3 
emissions due to their electricity use not 
being fully decarbonized. Innovations, 
such as high-efficiency electric motors 
and drives, deliver substantial net emis-
sions reductions compared to conven-
tional alternatives.
Addressing value chain emissions 
59
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Value creation  |  We enable a low-carbon society
Governance

ABB service offerings
Energy-related GHG 
emissions by segment¹
Industry  25%
Transport  22%
Buildings  8%
Power  40%
% of ABB revenues 
by sector²
52%
Industry
High-efficiency 
motors
and variable 
speed drives
Electrification 
of heavy-duty 
trucks
Optimization 
and factory 
automation
Emissions
monitoring 
and leak 
detection
14%
Transport and 
Infrastructure
Marine hybrid 
and electric 
propulsion
systems
EV onboard 
equipment
and charging
E-buses
and fleet charging 
and propulsion
Rail traction
electric
19%
Buildings
Building 
energy 
management
Power 
distribution
HVAC control
Lighting
and comfort 
control
Renewables
integration
Generators
Synchronous
condensers
Hydrogen
16%
Utilities
ABB’s technologies are at the core of accelerating the energy transition
Key market trends 
support demand for 
our customer offerings
Supporting all relevant sectors to
optimize, electrify, and decarbonize
Electrification –
the world
going electric
Energy security
Emissions 
reduction and 
energy efficiency
Automation
1. Source: International Energy Agency.
2. Management estimate based on FY 2025 revenues.
Due to rounding, numbers presented do not add to 100.
60
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Value creation  |  We enable a low-carbon society
Governance

ENGAGEMENT AND ADVOCACY
We partner with industry and policymakers 
to drive systemic change and accelerate 
global decarbonization. In addition to the 
Climate Group’s initiatives, ABB participates in 
the following:
•	 Energy Efficiency Movement – Advocating as 
a founding member for a doubling of energy 
efficiency by 2030;
•	 Capital Goods Coalition – Driving standard-
ization in supply chain decarbonization;
•	 WBCSD Partnership for Carbon Transparency 
– Sharing of product carbon footprints to 
better identify emissions hot spots.
We also advocate for policy frameworks that 
provide an enabling environment for the devel-
opment of a low-carbon economy. The topics on 
which we focus include:
•	 Accelerated electrification across sectors;
•	 Focus on energy efficiency;
•	 Decarbonization of the power system and 
other sectors;
•	 Skills development for the energy transition;
•	 A transition that is just, orderly, and 
publicly supported. 
To meet our near- and long-term Science Based Targets, ABB will:
•	 Expand supplier engagement beyond Tier 1 suppliers to achieve deeper 
value chain emissions reductions;
•	 Increase sourcing of low-carbon materials and product circularity;
•	 Accelerate grid decarbonization using ABB technologies. 
OUTLOOK
Energy efficiency in action
61%
improvement in 
energy productivity
In 2025, we achieved a 61% improvement in energy 
productivity, compared to 2019. This was largely due
to improvements in operational energy efficiency with
an absolute decrease in energy use of 3.7% in 2025 
compared to 2024, despite the continued increase in 
revenues in the same period.
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Value creation  |  We enable a low-carbon society
Governance

— 
LOW- CARBON
Futureproofing Denmark’s power grid 
with ABB’s digital substation solutions
To support Denmark’s green energy 
transition, utility company Vores Elnet 
partnered with ABB to upgrade its 
grid infrastructure. By digitalizing its 
substations, the company is future-
proofing the grid to handle variable 
energy flows and the increasing demand 
for electrification.
ABB’s Relion® protection relays and 
control systems enhance grid reliability, 
flexibility, and resilience – all of which are 
critical to integrating renewable energy 
sources. These upgrades enable real-time 
monitoring, faster fault detection, and 
remote configuration, which in turn re-
duce downtime and improve operational 
efficiency. This application of ABB’s 
scalable solutions demonstrates how 
digitalization and automation can accel-
erate the shift to a low-carbon society.
— 
LOW- CARBON
Building AI-ready data centers with 
ABB’s medium-voltage UPS solution
ABB is partnering with Kevlinx to deliver 
energy-intelligent data centers designed 
for scalable AI workloads. At Kevlinx’s 
new Tier III campus in Brussels, ABB’s 
innovative medium-voltage uninterrupt-
ible power supply (UPS) architecture 
integrates grid connection, switchgear, 
and backup systems. This reduces trans-
former losses and heat dissipation while 
improving energy efficiency.
The 40 MVA system, which can be scaled 
to 100 MVA, supports high-density power 
demands and future expansion. ABB’s 
UniGear switchgear and HiPerGuard UPS 
enable optimal uptime, lower energy 
costs, and grid-balancing capabilities. 
The solution transforms the UPS from a 
passive backup into an active smart grid 
component, helping to flatten peak loads 
and stabilize energy supply. This collab-
oration sets a new benchmark for sus-
tainable digital infrastructure, combining 
resilience, flexibility, and regulatory 
alignment to support the exponential 
growth of AI and cloud computing.
CASE STUDIES
62

— 
LOW- CARBON
Pioneering with Citroniq to advance low-
carbon plastics in the United States
ABB is supporting Citroniq’s initiative 
to produce 100 percent bio-based poly-
propylene at its new facility in the US 
state of Nebraska. Leveraging ABB’s 
advanced automation, electrification, 
and digital solutions, the plant will trans-
form corn-based ethanol into certified 
biogenic polypropylene, which is used for 
many vital everyday items, including food 
and beverage packaging, automotive 
parts, and medical devices.
In addition, the facility is expected 
to capture three million tons of CO2e 
each year and permanently store these 
emissions, converting them into solid 
pellets. At full capacity, Citroniq’s 
three-plant platform could slash emis-
sions from US polypropylene production 
by up to 20 percent.
This agreement highlights how ABB’s 
technology can accelerate the shift 
to low-carbon manufacturing, even in 
hard-to-abate sectors.
— 
LOW- CARBON
Smart electrification powers one of 
Finland’s largest solar installations
ABB is supporting EPV Energy’s new 
solar park in Heinineva, Lapua – one of 
Finland’s largest with 123,000 panels – 
by delivering smart electrification and 
automation technologies.
Built on a former peat bog, the 
park marks a strategic shift toward 
low-carbon energy. ABB provided a 
tailor-made solar park controller based 
on its ZEE600 platform, enabling central-
ized control, predictive maintenance, and 
participation in the electricity reserve 
market. ABB also supplied UniGear ZS2 
switchgear, Relion® protection relays, 
and EcoFlex transformer stations for 
the pilot tracker field, which features 
rotating panels to optimize solar cap-
ture. The collaboration helped EPV meet 
demanding regulatory requirements 
and streamline operations. With 96 per-
cent of EPV’s electricity already from 
emission-free sources, the solar park 
strengthens Finland’s renewable energy 
portfolio and supports the country’s goal 
of carbon neutrality by 2030.
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Value creation  |  We enable a low-carbon society
Governance

— 
ENERGY EFFICIENCY
Driving energy efficiency in steelmaking 
with ABB technologies
Steel manufacturing is one of the most 
energy-intensive industries, accounting 
for seven percent of global CO₂e emis-
sions. In India, a major steel manufac-
turing center, ABB partnered with Real 
Ispat and Power Ltd. (RIPL), an integrated 
steel and electric power manufacturing 
firm, to address rising energy costs and 
sustainability demands. ABB provided 
high-efficiency motors and Variable 
Frequency Drives (VFDs), optimizing 
energy use across critical processes 
like pumping, conveying, and crushing. 
RIPL also implemented hot charging of 
MS billets and modified furnace coils to 
eliminate energy-draining reheating.
As a result of these innovations, RIPL 
saves approximately three million kWh 
annually. By adopting dolochar as boiler 
fuel and embracing ABB’s technologies, 
RIPL significantly reduced its carbon 
footprint and improved cost competi-
tiveness. The collaboration showcases 
how industrial transformation can be 
both sustainable and strategic.
— 
LOW- CARBON
Powering new hybrid-electric ferries 
in support of British Columbia’s 
cleaner future
ABB is supplying a complete package of 
power, propulsion and control technol-
ogy for four new double-ended passen-
ger and car ferries operated by British 
Columbia Ferry Services (BC Ferries). 
One of the largest ferry operators in the 
world, BC Ferries provides year-round ve-
hicle and passenger service on 25 routes 
to 47 terminals, carrying approximately 
9.7 million vehicles and 22.7 million 
passengers annually. The ferries, which 
will replace four end-of-life vessels, are 
part of the ‘New Major Vessels’ program, 
aimed at delivering safe, environmentally 
sustainable and reliable operations in 
and around the Strait of Georgia, the 
body of water separating Vancouver 
Island from the Lower Mainland of 
British Columbia.
With diesel-battery hybrid technology 
that can operate on bio and renewable 
diesel today and transition to full electri-
fication as infrastructure evolves, these 
ships are a critical part of building a 
cleaner, quieter, and more reliable ferry 
system for the future.
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Value creation  |  We enable a low-carbon society
Governance

— 
ENERGY EFFICIENCY
Setting a new record for motor energy 
efficiency with ABB’s TIE innovation
ABB has set a new world record for energy 
efficiency in large synchronous electric 
motors with a new motor designed in 
line with its Top Industrial Efficiency 
(TIE) initiative. This new initiative delivers 
equipment which exceeds standard per-
formance benchmarks. The motor, devel-
oped for a steel plant in India, achieved 
an unprecedented 99.13 percent energy 
efficiency, surpassing the previous record 
of 99.05 percent, held by ABB since 2017.
This breakthrough enables the plant to 
save approximately 61 GWh of energy 
and $5.9 million in electricity costs 
over a 25-year period, while avoiding 
45,000 tons of GHG emissions.
The motor powers an air separation 
unit that supplies high-purity gases 
for steelmaking. By optimizing both 
electrical and mechanical design, ABB 
demonstrates how industrial equipment 
can push the boundaries of performance 
without compromising reliability. The 
achievement highlights ABB’s commit-
ment to resource efficiency and its role 
in helping industries reduce lifecycle 
costs and environmental impact through 
cutting-edge electrification.
— 
ENERGY EFFICIENCY
Stabilizing data center power for AI 
growth with ABB and VoltaGrid
To help meet surging electricity demand 
from AI-driven data centers, ABB is 
supplying grid stabilization technology 
for multiple facilities in the US, including 
three orders from VoltaGrid. ABB’s scope 
includes 27 synchronous condensers 
and prefabricated eHouse units, provid-
ing high inertia and reactive power to 
maintain network voltage and support 
short-circuit faults.
These solutions enhance grid reliability 
and resilience, enabling data centers to 
manage increased loads and maintain 
uptime as AI adoption accelerates. 
VoltaGrid’s mobile generators, which are 
natural gas-powered, provide the initial 
electricity supply, while ABB’s technology 
complements this by stabilizing the grid 
and ensuring consistent power quality. 
With data center electricity consumption 
expected to more than double by 2030, 
ABB’s integrated automation, electrifi-
cation, and digitalization solutions help 
operators optimize performance, drive 
energy efficiency, and meet growing 
demand while supporting a reliable 
energy ecosystem.
65
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Value creation  |  We enable a low-carbon society
Governance

Reduced waste sent to landfill to 
5.3%  
 
as we work towards our 2030 target 
of zero waste to landfill
Achieved circularity score of 
27% 
 
for our product-related revenue
As our world becomes more resource 
constrained, ABB is committed to 
safeguarding natural resources throughout 
our value chain. We work to minimize our 
use of water and virgin raw materials; 
increase our efforts to become a 
resource-efficient business, reduce waste 
and pollution; and protect biodiversity. 
We do so by working with suppliers and 
customers, supporting their journeys, too.
2025 HIGHLIGHTS 
Awarded
AWS Standard 
certification (Gold)
from the Alliance for Water Stewardship for 
our Bangalore site in India
Required sites within one kilometer of
biodiversity-sensitive 
or protected areas
to assess proximity impacts and adopt 
precautionary environmental measures
­— 
VALUE CREATION
WE PRESERVE RESOURCES 
66
Introduction
Value creation  |  We preserve resources 
Governance

ABB’s management and targets 
The commitment to conserve natural 
resources is embedded in our business. 
It is a key pillar of ABB’s Sustainability 
Agenda and an integral part of how we 
create value for stakeholders. For exam-
ple, our most recent double materiality 
analysis confirmed that circular economy 
is a material topic for ABB.
The wide-ranging nature of resource 
preservation results in ABB collaborat-
ing across two working groups to drive 
progress across various topics. ABB’s 
Circularity Working Group addresses 
the impacts, risks, and opportunities as 
we embed circularity principles into our 
business, while the Water, Waste, and 
Biodiversity Working Group focuses on 
water security, minimizing waste gener-
ated by ABB, eliminating waste sent to 
landfill, and protecting nature and biodi-
versity. Working with both suppliers and 
customers, we support their journeys 
and develop innovative products and 
services that meet their needs.
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Value creation  |  We preserve resources 
Governance

A circular approach enables us to keep 
value in use: with products that last 
longer, systems built to outperform, and 
products that become reusable through 
refurbishment, retrofitting, and recycling. 
From reliable and resource-efficient 
products, smart diagnostics and upgrad-
able systems to responsible sourcing and 
end-of-life strategies, we help industries 
to preserve resources, extend product 
life, boost operational efficiency and 
resilience, and reclaim material and 
economic value. This 2030 target is 
forecasted in our long-term performance 
planning at division level.
This approach is integrated into our 
eight circularity KPIs, which correspond 
to stages of the product lifecycle (see 
illustration). We continue to expand our 
circular business offerings and enhance 
the transparency with which we disclose 
environmental information about our 
products. By the end of 2025, we assessed 
46 percent of our product-based revenues 
against our Circularity Framework and 
achieved an alignment of 27 percent.
ABB’s Circularity Framework also sets out 
our governance model, methodologies, 
and monitoring systems. Our Circularity 
Working Group coordinates initiatives 
across our business, establishing guide-
lines, and sharing best practices.
Circularity can yield new partnerships, 
products, and services, benefiting not 
only our business but our suppliers and 
customers, too. For example, ABB’s 
digital solutions can extend the life 
of customer assets through remote 
monitoring and services, corrective as 
well as predictive maintenance, and 
modernization. These solutions can also 
prevent failures and costly downtime, 
optimize performance, and reduce 
waste. Our end-of-life services ensure 
responsible decommissioning, disposal, 
and recycling of any ABB or non-ABB 
equipment to achieve both safety and 
environmental outcomes. ABB proactively 
manages circularity-related risks, such 
as products becoming obsolete, delays 
in bringing circular solutions to market, 
and shortages of critical materials, to 
safeguard competitiveness, reliability, 
and sustainability.
ABB also engages with leading orga-
nizations in the field of circularity, in-
cluding the World Business Council for 
Sustainable Development and the Ellen 
MacArthur Foundation. By doing so, we 
help to shape a common framework and 
set of metrics to enhance transparency 
and comparability across industry, 
thereby advancing best practices, fully 
aligned with our commitment to driving 
circularity beyond our organization.
Building circularity 
What we enable 
circular customer 
solutions
What we do 
ABB circular
operations
Design
Sourcing
Manufacturing
Packaging
Efficiency
Lifetime
Take-back
Recycling
Circular
design and
sourcing
Resource-
efficient
operations
Optimized
use phase
Responsible
end-of-life
ABB 
Circularity 
Framework
ABB Circularity Framework
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Value creation  |  We preserve resources 
Governance

Eliminating waste to landfill 
Managing water risk
ABB has committed to sending zero 
waste to landfill by 2030. Since this 
target is included in our long-term per-
formance planning, every ABB division 
has waste reduction and recycling pro-
grams in place. In addition, our waste 
management requirements are aligned 
with international standards.
ABB is driving down waste across our 
global operations by:
•	 Improving the efficiency of our 
processes;
•	 Increasing the proportion of sustain-
able materials in products and packag-
ing; and
•	 Expanding on-site recycling rates.
In 2025, we launched our “Zero Waste to 
Landfill Playbook” to provide our sites 
with tangible resources on how they can 
minimize waste generation and reduce 
disposal to landfills. The publication 
helps sites calculate waste diversion 
rates, improve recycling efficiency, make 
process improvements, reduce con-
sumables, and use vendors to increase 
waste diversion.
ABB recycled 81 percent of waste from 
operations during 2025, with only  
5.3 percent (5.8 percent in 2024) of waste 
sent to landfill and 4.1 percent to energy. 
The amount of waste generated by ABB 
operations increased by 15.1 percent to 
217.8 kilotons compared to the previous 
year. The increase was mainly driven by 
construction projects.
ABB recognizes the critical nature of 
water security to our own operations and 
to the health of our communities and 
ecosystems. As climate change, popu-
lation growth, and industrial demand 
put further pressure on water security, 
we recognize fresh water as a finite 
and shared resource and endeavor to 
use water responsibly throughout our 
value chain.
We conduct annual assessments of 
water-related risk across more than 
320 global sites, focusing on those in 
water-stressed regions. We use the 
global water risk tool of the World 
Resources Institute (WRI) to conduct 
these assessments.
As of 2025, 109 ABB sites were located in 
areas of high and extremely high water 
stress (compared to 91 in 2024). We 
require 100 percent of these sites to per-
form a self-assessment and action plan-
ning by the end of 2026. We encourage 
our sites to align their action planning 
with the requirements of the Alliance for 
Water Stewardship (AWS). This globally 
recognized framework for sustainable 
water management addresses respon-
sible water use, water quality, and gov-
ernance at a watershed level through 
multi-stakeholder engagement. The 
first ABB site to gain AWS Standard 
certification (Gold) from the Alliance for 
Water Stewardship is our Bangalore site 
in India. We are planning to roll out the 
program to ABB sites around the world.
In our supply chain, exposure to water 
risk is even greater. We therefore work 
with key suppliers to assess and mitigate 
water-related risks, from flooding to wa-
ter scarcity. In addition, we ask suppliers 
to demonstrate how they monitor water 
usage, improve water efficiency, and 
partner with local institutions.
Our water and wastewater solutions 
help customers reduce water extraction 
and address freshwater pollution. ABB’s 
Water Care program also helps optimize 
plant performance, protect equipment 
and extend the operating life of these 
assets (both automated and electrical).
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Value creation  |  We preserve resources 
Governance

ABB has systems in place to control and phase 
out the use of hazardous substances in ABB 
products and processes. Our List of Prohibited 
and Restricted Substances addresses every part 
of our business – from procurement, product 
development, and production to products and 
packaging materials, as well as service activi-
ties and construction sites.
To adhere to all local and global regulations 
for material compliance, we review and up-
date the list twice a year. Our divisions are 
accountable for local compliance obligations 
and the information collected from suppliers 
is used for regulatory submissions and cus-
tomer communications.
We require suppliers to support ABB’s efforts to 
maintain compliance with such regulations as 
REACH (Registration, Evaluation, Authorisation 
and Restriction of Chemicals) and RoHS 
(Restriction of Hazardous Substances). Working 
together also helps to prevent restricted sub-
stances from entering ABB’s supply chain; if a 
supplier cannot complete the required compli-
ance declaration, we cannot use their products. 
To help our suppliers, we have developed a 
companion guide to the ABB List of Prohibited 
and Restricted Substances. We are also working 
collaboratively to find alternatives for sub-
stances that may be restricted in the future.
Our businesses continuously collect and assess 
material compliance information from our 
suppliers. In 2025, this included gathering infor-
mation on the usage of per- and polyfluoroalkyl 
substances (PFAS) for reporting to authorities 
and customers.
For further information please 
refer to the Sustainability 
Statement 2025.
Tackling pollution and substances of concern 
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Value creation  |  We preserve resources 
Governance

There is growing global recognition that 
biodiversity loss and ecosystem degradation 
are systemic risks – and that these issues are 
interconnected with climate change. One chal-
lenge cannot be effectively addressed without 
the other.
ABB recognizes that the health of natural eco-
systems underpins the stability of our business, 
as well as the customers, suppliers, and com-
munities we serve. As we enhance our under-
standing and management of these issues, we 
aim to protect nature and biodiversity at and 
around ABB sites.
In 2025, we introduced a new Environmental 
Procedure requiring ABB sites located within 
one kilometer of a biodiversity-sensitive or 
protected area to include the proximity to the 
protected area in their evaluation of significant 
environmental aspects in the site’s environ-
mental management system (EMS). Sites must 
take adequate precautionary measures by 
December 31, 2026.
Accountability for assessing and mitigating 
biodiversity risks lies with ABB’s Waste, Water & 
Biodiversity Working Group. In 2025, we worked 
with external partners to apply a structured 
approach to assessing and managing ABB’s 
nature-related dependencies and impacts.
Protecting biodiversity 
•	 Continue to align our product portfolio to ABB’s Circularity Framework, 
while reducing our total waste sent to landfill;
•	 Increase water efficiency across all ABB sites and scale up 
AWS certifications of sites;
•	 Preserve biodiversity – proactively manage biodiversity risks.
OUTLOOK
This approach is in line with the Taskforce on 
Nature-related Financial Disclosures (TNFD). Of 
our 429 global sites in scope, 66 are confirmed 
to be in or near areas that are sensitive or pro-
tected from a biodiversity perspective.
We also collaborate increasingly with suppliers 
and customers on biodiversity protection. For 
example, to comply with the expected obli-
gations of the EU Deforestation Regulation 
(EUDR), we have begun working with our 
suppliers to ensure our products are free from 
deforestation and habitat loss. The EUDR places 
new responsibilities on suppliers to demon-
strate compliance through traceability and 
due diligence.
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Value creation  |  We preserve resources 
Governance

CASE STUDIES
— 
CIRCUL ARIT Y
Extending asset life to support circularity 
at Belgian nuclear power plant
Belgium’s Doel 4 nuclear power plant 
was commissioned in 1985 and originally 
set for decommissioning in 2025. Yet in 
response to shifting energy needs, the 
plant’s lifespan has been extended by a 
decade, prompting a major moderniza-
tion of its electrical infrastructure.
Following a holistic assessment that 
recommended both retrofit and re-
placement of obsolete switchgear, 
ABB developed a retrofit strategy with 
French electrical utility company ENGIE 
that demonstrates how circularity can 
be applied to large-scale energy infra-
structure. This approach allowed more 
than half of existing equipment – such as 
cabinets, plates, and busbars – to remain 
in circulation, while upgrading critical 
components, including circuit breakers 
and relays.
By choosing retrofitting over full replace-
ment, the project minimized downtime, 
reduced resource dependency, and ad-
vanced decarbonization goals. The proj-
ect also demonstrates how circularity 
can be embedded in future infrastructure 
decisions, keeping materials in use lon-
ger and supporting safe and sustainable 
energy supply.
— 
WATER
Water positivity site helps water-
depleted community in India
The southern Indian city of Bangalore 
experiences severe groundwater 
depletion due to rapid urbanization, 
over-extraction, and inadequate ground-
water recharge.
ABB’s Nelamangala site, located north-
west of Bangalore, has helped to increase 
groundwater levels in their community 
while recycling their treated water on 
site. Their operations recycle around 
85 percent of their treated water, re-
plenishing their water ~1.25 times faster 
than it is consumed. Through rainwater 
harvesting, they have reduced runoff 
and increased groundwater levels in 
their community by more than 30 meters 
over the past three years. Nelamangala 
was the first ABB location globally to be 
certified as a water-positive facility in 
2021, going beyond just conserving water 
to returning more freshwater to the 
environment than they use. In 2025, this 
site was also the first ABB site globally to 
gain AWS Standard certification (Gold) 
from the Alliance for Water Stewardship.
72

— 
WATER
Monitoring water stress from space with 
ABB infrared-sensing technology
Using advanced satellite-based ther-
mal imaging, ABB is helping to identify 
early signs of drought and inefficient 
irrigation. Installed on a Hydrosat 
VanZyl-1 satellite, ABB’s infrared camera 
delivers high-resolution and calibrated 
surface temperature data that helps 
detect water stress in agricultural fields. 
By measuring minute temperature 
variations, the system enables timely 
interventions to prevent crop loss. The 
technology also supports monitoring of 
vegetation health, industrial heat output, 
and deforestation.
Honed over decades of space missions, 
ABB’s expertise in infrared instrumen-
tation is now helping governments 
and industries make smarter decisions 
about water use. In addition, this col-
laboration with Hydrosat demonstrates 
how space-based sensing can support 
sustainable resource management and 
climate resilience.
— 
WATER
Modernizing water infrastructure at a 
UNESCO site with ABB automation
ABB is modernizing the water infrastruc-
ture of Zagori, a UNESCO World Heritage 
site in northwestern Greece, through ad-
vanced automation solutions. The proj-
ect includes 31 control and monitoring 
stations equipped with SCADA telemetry, 
PLCs, high-efficiency pumps, and water 
quality sensors. These systems enable 
real-time monitoring, leak detection, and 
optimized distribution, reducing opera-
tional costs and enhancing environmen-
tal protection.
ABB’s technology supports the munic-
ipality’s goals of sustainable tourism 
and reliable service for residents, while 
preserving the region’s natural and 
cultural heritage. The solution integrates 
centralized control, electromagnetic 
flowmeters, and variable frequency 
drives to ensure efficient, resilient wa-
ter management. The project reflects 
ABB’s commitment to supporting mu-
nicipalities in building smarter, more 
sustainable infrastructure in ecologically 
sensitive areas.
73
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Value creation  |  We preserve resources 
Governance

Continued to target
zero life- 
changing events
for our people and contractors
Launched
global tax 
contributions 
disclosure
Recommitted to the
UN Women 
Empowerment 
Principles 
Continued to enhance ABB’s
human rights 
due diligence
approach and policy adherence
2025 HIGHLIGHTS 
ABB aims to deliver positive social impact, 
not only in our own business but in our 
value chain and communities, too. From 
programs that address health and safety, 
diversity and inclusion or development 
of our people to broader supply chain 
and community investment programs, 
our activities are underpinned by ABB’s 
commitment to human rights and ethical 
business conduct.
­— 
VALUE CREATION
WE PROMOTE SOCIAL PROGRESS 
74
Introduction
Value creation  |  We promote social progress
Governance

Business is key to building a society that is 
prosperous, healthy, and fair for all. ABB aims to 
contribute to the social and economic wellbeing 
of employees, as well as customers, supply 
chain workers, and communities. Doing so also 
contributes to a more sustainable, equitable, 
and inclusive workplace. Our People Strategy 
defines this as Empower, Grow, Impact.
Our starting point is to engage ABB’s stakehold-
ers, listening to their needs and aspirations. 
Some conversations inform the overarching 
strategic direction of our business or our 
Sustainability Agenda, while more in-depth dis-
cussions have influenced our double materiality 
process and specific programs.
The social topics identified as material to our 
business include matters relating to our own 
workforce, workers in the supply chain and the 
communities where we operate. These encom-
pass health and safety, human rights and labor 
standards, employee development, diversity 
and inclusion, as well as responsible sourcing 
and community investment programs. ABB also 
addresses diversity and inclusion as part of our 
Sustainability Agenda.
These topics represent our greatest opportu-
nity to create social value for ABB, our employ-
ees, customers, and supply chain workers, as 
well as our wider communities. We have estab-
lished the following targets and ambitions to 
drive progress in our work. 
Management and targets
Health
and safety
Achieve zero life-changing events for our 
employees and contractors, measured 
in absolute number of serious incidents 
and fatalities 
Diversity
and inclusion
Increase the proportion of women in 
senior management roles to 25% by 2030
Sustainable Supply 
Base Management 
Program
At least 80% of spending on high-risk 
suppliers in focus countries covered by 
Sustainable Supply Base Management 
(SSBM) by 2025; at least 80% of supply 
spending in focus countries to be covered 
by SSBM by 2030
Community 
investment
Ambition to expand ABB’s community 
engagement programs
Employee 
development
Top-tier results for our industry in our 
annual engagement survey 
Social progress focus areas
75
Introduction
Value creation  |  We promote social progress
Governance

Promoting health and safety 
Fostering health and safety in the work-
place are fundamental employer respon-
sibilities. No one should suffer injury or ill 
health as a consequence of our business.
These commitments are underpinned by 
ABB’s Health, Safety, Environment, and 
Security (HSE&S) Policy and Management 
System, which are based on interna-
tionally recognized standards ISO 
14001 and ISO 45001. Our system and 
its governance framework place health, 
safety, environment, and security firmly 
at the center of ABB’s business. All ABB 
employees and contractors are covered 
by our Management System and our HSE 
requirements are clearly stated in our 
Supplier Code of Conduct.
Given the growing maturity of ABB’s 
approach to safety, we have now moved 
beyond traditional, compliance-driven 
models. Our approaches to risk man-
agement and continuous learning are 
shaping a stronger, more resilient safety 
culture, while ABB’s Guiding Principles for 
Resilient Operations set out our holistic 
and human-centric approach.
We encourage curiosity to learn and 
support continuous improvement 
among individuals, teams, and our 
wider organization.
Learn and Improve
Through collaboration, we draw on 
our diverse knowledge and strengths, 
while ensuring colleagues contribute 
to HSE&S programs and performance.
Engage and Involve
Leaders at every level should create 
an environment where colleagues 
feel psychologically safe, cared for, 
and confident to speak up.
Lead with Care
ABB WAY
Taking care of our 
health, safety, and 
environment
Resilient 
operations
ABB’s holistic and human-centric approach to safety culture 
76
Introduction
Value creation  |  We promote social progress
Governance

We empower ABB employees at all levels 
to take ownership of risk as we leverage 
data, behavior, and trust to predict 
and prevent harm. Both employees and 
contractors are actively encouraged to 
identify, resolve or escalate, and report 
any unsafe act or condition that they find 
in the workplace. All hazards are logged 
centrally in our HSE&S Management 
Information System. If a hazard cannot 
be resolved on the spot, its resolu-
tion will be escalated to a responsible 
manager, who will enter any corrective 
actions in the management information 
system. ABB units are encouraged when 
developing campaigns or action plans to 
review their top five hazards and top five 
incident categories at least twice a year. 
In 2025, we identified 270,457 hazards 
and had a resolution rate of 98 percent.
In 2025, we continued to drive down our 
lost-time injury frequency rate (LTIFR), 
achieving an industry-leading rate of 
0.14. This represents an improvement of 
nearly 9 percent over the previous year 
and of nearly 45 percent if compared 
to the 2019 baseline. Serious incidents 
continued to fall, with a reduction of 
58 percent over the previous year. There 
were no fatalities.
In addition to promoting physical health 
through local campaigns featuring free 
cardiovascular risk checks, nutrition 
consultancy or anti-smoking webinars, 
we support our people’s mental well-
being. All employees worldwide have 
access to counselling services as part 
of ABB’s Employee Assistance Program. 
Recognizing the critical influence man-
agers have on organizational culture and 
employee well-being, ABB continued 
to offer the meQuilibrium program to 
its leadership group. Managers often 
experience heightened stress and 
decision-making pressure, which can im-
pact team resilience if left unaddressed. 
This initiative leverages predictive an-
alytics and evidence-based strategies 
to strengthen leadership resilience and 
reduce burnout risk. Compared to their 
baseline assessments, participating 
managers achieved a 34 percent im-
provement in resilience scores and a 
10 percent reduction in reported burnout 
risk, demonstrating measurable progress 
in mental wellbeing. These outcomes 
reinforce ABB’s commitment to fostering 
psychologically safe, high-performing 
leadership and ensuring sustainable 
health practices across the organization. 
77
Introduction
Value creation  |  We promote social progress
Governance

In 2025, the fifth consecutive year of our 
D&I strategy 2030, there was continued mo-
mentum across all pillars of the strategy; 
Governance, Inclusive leadership and Culture, 
and Partnership. Our annual D&I calendar spans 
across core themes, such as culture, gender 
equality, LGBTQ+ and Pride, generations and 
disabilities and wellbeing, with dedicated pro-
gramming and global engagement throughout 
the year.
Diversity and inclusion are embedded in ABB’s 
long-term objectives, with global targets for 
women in senior management included in our 
2030 diversity strategy1.
By 2030, we have committed that women will 
account for 25 percent of ABB’s senior leaders1. 
In 2025, the proportion of female senior manag-
ers2 rose to 22.6 percent.
Beyond our own operations, we also partner 
with organizations and support standards that 
promote diversity and inclusion. These include 
the UN Women Empowerment Principles 
(WEPs), and UN Standards of Conduct Tackling 
Discrimination against Lesbian, Gay, Bi, Trans, 
& Intersex People, as well as the Society of 
Women Engineers, the Special Olympics, and 
Workplace Pride.
In addition, our global and gender-neutral 
parental leave program has been in place 
since 2021, supporting our inclusive work en-
vironment. ABB’s employee resource groups 
continue to be a cornerstone of our inclusion 
agenda. They are voluntary, employee-led com-
munities that foster inclusion, connection, and 
professional growth. They provide safe spaces 
for employees to share experiences, build 
networks, and drive meaningful change across 
the organization.
In 2025, our annual Employee Engagement 
Survey results reflected a growing sense 
of inclusion, with a solid increase in our 
inclusion-related scores (Inclusion 82/100, 
Inclusiveness Culture 81/100 & Belonging 
78/100, all of which increased two points over 
last year). These results affirm that our efforts 
are creating a workplace where employees feel 
valued, respected, and empowered to contrib-
ute their unique perspectives.
1.	 This target and disclosure 
relates to countries where 
policies legally permit and 
to the extent that it does not 
conflict with any applicable 
laws, where ABB operates, 
and therefore 13 percent of 
total senior management is 
not included in the target 
and disclosure.
2.	 At ABB, senior managers are 
defined as employees in Hay 
grade 1-7, including Division 
Presidents.
Fostering diversity and inclusion 
D&I target 2030
25% women in 
senior management¹
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Introduction
Value creation  |  We promote social progress
Governance

ABB invests in the professional and per-
sonal development of our people, helping 
them achieve their full potential. This also 
benefits our business since these oppor-
tunities allow us to retain employees who 
are trained, motivated, and feel valued.
EMPLOYEE ENGAGEMENT
Honest, two-way communication 
between ABB and our workforce is 
essential for strengthening trust and 
decision-making. We are therefore com-
mitted to open dialogue, ensuring that 
employee voices are heard.
For example, our annual engagement 
survey seeks input from our entire global 
workforce on their experience of working 
for ABB. Other engagement might in-
clude quick pulse surveys, focus groups, 
social media or townhalls, to share 
strategic updates or hold leadership 
Q&As. As our largest engagement exer-
cise, ABB’s annual engagement survey 
helps us understand how employees 
experience our workplace and what im-
provements we could make. In 2025, our 
employee engagement score was 80 out 
of 100, up from 78 in 2024. Nearly 92,000 
employees, 85 percent of our workforce, 
took part in the survey.
TRAINING AND 
DEVELOPMENT
Our people help ABB tackle the immense 
technological challenges of today and to-
morrow, delivering innovative solutions 
for our customers. To retain industry 
leadership, we must ensure employees 
have the best technical skills and are 
agile and adaptable. We create continu-
ous learning opportunities that span all 
aspects of training and development. In 
addition, our people performance man-
agement combines annual management 
by objectives with a multidimensional 
performance appraisal approach, placing 
greater emphasis on ongoing, real-time 
and meaningful performance and de-
velopment conversations, supported 
by digital tools and technologies. From 
formal training to on-the-job learning 
and networking, our program culminates 
in ABB’s annual Learn Connect Grow Day. 
In 2025, over 45,000 employees partic-
ipated in the Learn Connect Grow Day 
events, compared to over 30,000 employ-
ees in 2024.
Average training hours for ABB employ-
ees continue to grow from 8.4 hours per 
FTE in 2024 to 11.5 hours per FTE in 2025.
SUSTAINABILITY ECOSYSTEM 
FOR EMPOWERMENT AND 
DEVELOPMENT
In 2025, ABB continued to strengthen 
its sustainability capabilities through 
SEED (Sustainability Ecosystem for 
Empowerment and Development), 
a global, business-led upskilling initiative 
designed to embed sustainability into 
everyday roles and decisions.
SEED provides employees with easy 
access to curated learning pathways 
aligned to ABB’s sustainability pillars 
and tailored to specific job families. The 
program combines digital learning, live 
webinars, and experiential formats to 
support both knowledge building and 
practical application.
By the end of 2025, nearly 4,000 partici-
pants engaged across courses, webinars, 
and experiences spanning all businesses 
and functions. Flagship initiatives in-
cluded human rights certification pro-
grams, sustainability upskilling for sales 
and IT professionals, and pilot collabo-
rations with external partners such as 
WBCSD, Climate School and Xunlocked.
SEED reflects ABB’s conviction that 
sustainability leadership is primarily 
built internally and that broad capabil-
ity building is essential to deliver on 
strategy. By equipping employees with 
the skills, tools, and confidence to act, 
SEED supports long-term value creation, 
responsible business practices, and 
the acceleration of ABB’s sustainabil-
ity agenda.
Supporting employee development and wellbeing 
Average training hours for ABB employees
11.5
hours per 
FTE in 2025
8.4
hours per 
FTE in 2024
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Introduction
Value creation  |  We promote social progress
Governance

OUR COMMITMENT TO 
HUMAN RIGHTS
ABB’s ambition is that human rights are well 
understood, managed and integrated through 
both our daily business, and our value chain.
Alongside the ABB Code of Conduct and 
Supplier Code of Conduct, the ABB Human 
Rights Policy formalizes ABB’s commitment to 
respecting human rights and describes ABB’s 
approach to human rights due diligence. The 
company supports and respects the human 
rights principles and labor standards out-
lined in the UN Guiding Principles on Human 
Rights, the OECD Guidelines for Multinational 
Enterprises, the ILO Core Conventions and other 
international frameworks. The principles of the 
above frameworks are applied within the ABB 
Human Rights Policy and the ABB Human Rights 
Due Diligence Framework.
The company’s commitment and expectations 
to respect human rights applies to every indi-
vidual who works for ABB or engages with us 
along our value chain.
GOVERNANCE AND 
RESPONSIBILITIES
The Human Rights Workstream is the opera-
tional decision-making body responsible for 
leading and coordinating the human rights 
agenda. It includes representatives from each 
business and corporate function and collabo-
rates regularly with relevant internal stakehold-
ers. Human Rights Champions are appointed 
within each division based on business needs 
and risk exposure, and they coordinate the 
program in their own business. Accountability 
for implementing the ABB Human Rights Due 
Diligence Framework rests with each busi-
ness area president and division president. 
Group Function Leaders are responsible for 
implementing the ABB Human Rights Policy in 
their respective functional policies and proce-
dures. The Sustainability Council acts as the 
highest operational decision-making body for 
sustainability, while the Executive Committee 
validates the Sustainability Agenda and 
its implementation.
ABB has identified and prioritized potential 
adverse human rights risks to our business 
across our value chain. These include child 
labor; corruption and bribery; environmental is-
sues impacting human rights; fair employment; 
health and safety; human trafficking and mod-
ern slavery; impact on communities and land 
rights; information security, and data privacy. 
Our roadmap helps ABB address these potential 
risks across our entire value chain.
More information about the 
SSBM and the Responsible 
Minerals Programs and 
results are available in 
Governance: Integrity and 
Transparency, under the sec-
tion “Responsible sourcing”.
For the complete ABB Human 
Rights Policy, refer to this link.
For more detailed informa-
tion, please refer to Human 
rights – ABB Group page.
Supporting and respecting human rights 
Access to
grievance and
remedy
Track and
communicate
performance
Assess actual
and potential
impacts
Cease, prevent
or mitigate
adverse impacts
The ABB Human Rights Due Diligence Framework
ABB Human Rights Due Diligence Framework
Stakeholder engagement & continuous improvement
Embedding
human rights
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Value creation  |  We promote social progress
Governance

INTERNAL HUMAN RIGHTS 
AWARENESS AND 
COMPETENCE BUILDING
Building competences and training of our 
workforce is the cornerstone of our way 
to ensure human rights are well under-
stood and managed through our value 
chain. In 2025, we have launched a new 
certification process for the existing 
Human Rights Champions and organized 
regular opportunities for continuously 
building their understanding of human 
rights risks and challenges. We also 
offered a newly updated edition of the 
Human Rights Champions training, com-
bining e-learnings and case studies anal-
ysis. In 2025, 29 Champions have been 
newly certified. In addition, we offered 
new training pathways and deep-dive 
training on human rights salient issues 
and security. During the year 1,267 hours 
of human rights training was completed.
HUMAN RIGHTS IN 
OPERATIONS
In our own operations, ABB’s Human 
Rights Requirements and Approved Code 
of Practice continue to be part of our 
Health and Safety Management System. 
In 2025, a new wave of site assessments 
and audits evaluated our implementation 
of human rights due diligence in oper-
ations. In total, 129 assessments and 
62 audits were undertaken. In addition, 
the Sustainability Observation Tour 
(SOT) is another tool based on dialogue 
and used by managers to observe any 
non-conformance or concerns in our op-
erations related to sustainability topics, 
including human rights.
We respect our employees’ right to 
freedom of association and collective 
bargaining and engage in good faith with 
their representatives. Around 52 percent 
of ABB employees are covered by col-
lective bargaining agreements but even 
where that does not apply, we commit to 
providing working conditions that meet 
or exceed local requirements.
HUMAN RIGHTS IN OUR 
SUPPLY CHAIN
ABB’s two main programs to prevent 
and mitigate human rights and la-
bor rights risks in our supply chain 
include our Sustainable Supply Base 
Management Program (SSBM), as well 
as our Responsible Minerals Program; 
both programs are part of our respon-
sible sourcing approach. As part of 
our SSBM Program, eligible new sup-
pliers must complete a sustainability 
self-assessment which includes how 
they manage labor and human rights, 
both in their operations and their sup-
ply chains. Further due diligence, such 
as mandatory on-site audits, may be 
performed depending on the supplier’s 
sustainability risk. Existing suppliers may 
also be subject to on-site sustainabil-
ity assessments.
Our Responsible Minerals Program in-
cludes due diligence on tin, tungsten, 
tantalum, gold, cobalt, and mica. Our ef-
forts are focused on conflict-free sourc-
ing of these minerals and moving away 
from sources that are deemed high-risk. 
As human rights risks are especially 
high in the extraction phase, we em-
phasize the importance of supply chain 
transparency and responsible sourcing 
practices with our Tier 1 suppliers and 
encourage targeted suppliers to imple-
ment improvement plans that strengthen 
traceability, transparency, and overall 
compliance. We are also exploring other 
opportunities to influence upper tiers in 
our supply chain related to these matters.
ABB’s Supplier Code of Conduct clearly 
explains in detail what we expect from 
our suppliers in preventing and mitigat-
ing human rights risks. More on these 
programs can be found in “Integrity 
and Transparency” chapter under 
Responsible Sourcing.
HUMAN RIGHTS IN SALES 
AND BUSINESS PARTNERS
We conduct downstream due dili-
gence in customer relationships and 
among channel partners, considering 
country-specific, partner-related, and 
sectoral risks. We also assess ABB’s 
level of involvement to help identify and 
mitigate potential human rights impacts. 
When risks are identified, internal es-
calation mechanisms and stakeholder 
engagement processes are activated, 
with actions tailored to the complexity 
of the context and severity of the risks. 
The Human Rights Champions support 
the business by advising on risk analysis 
and appropriate response measures. 
We continue to explore ways to enhance 
the effectiveness of downstream due 
diligence, while building internal capa-
bilities in human rights risk assessment 
and remediation.
GRIEVANCE MECHANISMS 
AND REMEDIATION
Information on ABB’s reporting chan-
nels (and incidents) which are available 
to employees, contractors, suppliers, 
customers, and community members, 
can be found in Governance: Integrity 
and transparency.
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Value creation  |  We promote social progress
Governance

Engaging with stakeholders on human rights 
ABB is an active participant in the Global 
Business Initiative on Human Rights 
(GBI) and a signatory of the UN Global 
Compact (UNGC), reinforcing our com-
mitment to collaborative action and 
continuous improvement. Internally, we 
conduct an annual engagement survey 
to capture employee insights and foster 
a culture of transparency and account-
ability. Beyond formal memberships, we 
actively collaborate with external human 
rights professionals and advisors to 
challenge and strengthen our approach. 
This ongoing engagement helps us 
identify effective ways to support human 
rights, while continuously enhancing 
internal awareness and building organi-
zational capabilities.
As we enhance our approach to human 
rights, ABB is committed to deepening 
stakeholder engagement to inform 
and strengthen our Human Rights Due 
Diligence Framework, in line with the 
UN Guiding Principles on Business and 
Human Rights. In 2025, for example, we 
held engagement sessions in India to 
better understand local human rights 
challenges and explore new opportu-
nities for collaboration and solutions, 
including in relation to risks in relevant 
parts of ABB’s mineral supply chains.
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Value creation  |  We promote social progress
Governance

Investing in our communities 
We aim to help our communities create 
a sustainable and prosperous future, 
contributing in ways that are meaningful 
and impactful. We do this in a variety of 
ways. Firstly, we take a responsible and 
transparent approach regarding our tax 
payments to local economies. Secondly, 
ABB is also committed to building and 
supporting a sustainable value chain 
beyond our own operations. Lastly, we 
partner with local organizations to create 
community engagement programs that 
deliver lasting social value.
TAX CONTRIBUTIONS
Taxes are a key mechanism through 
which ABB contributes to economies in 
which we operate. Corporate tax contri-
butions provide vital funding for public 
services and infrastructure, supporting 
the UN Sustainable Development Goals 
and overall socioeconomic development.
ABB’s Tax Policy defines the fair, re-
sponsible, and transparent approach 
we take to managing our tax affairs. 
The policy includes the following prin-
ciples which apply to all of ABB’s world-
wide operations:
•	 We comply with tax laws and regula-
tions – in both letter and spirit – wher-
ever we operate;
•	 We engage only in business transac-
tions which support genuine commer-
cial activity;
•	 We do not adopt tax structures 
that are based on form without 
economic substance;
•	 We do not use tax havens, hybrid in-
struments and/or entities in structures 
that result in tax avoidance, double 
deduction, or no taxation.
ABB’s consolidated financial statements 
refer to taxes paid on profit as part of 
our overall financial position and per-
formance. Yet these represent half of 
the taxes borne by ABB, which comprise 
three discrete elements:
•	 Profit taxes: Corporate income tax 
paid as reported in the Consolidated 
Statements of Cash Flows;
•	 People taxes: Our portion as employ-
ers of social security contributions 
and similar in relation to employment 
of staff;
•	 Other taxes: All other taxes borne by 
ABB, including property taxes, capital 
taxes, or import and export duties on 
products shipped across borders.
In 2025, total taxes borne by ABB reached 
$3.3 bn (or $3,280 mn).
In addition, ABB is responsible for col-
lecting taxes from our stakeholders on 
behalf of public authorities and institu-
tions. These include:
•	 VAT (value-added tax), GST (goods 
and services tax), and sales tax 
from customers;
•	 Personal income tax or social security 
from employees;
•	 Withholding tax on dividends 
from shareowners.
ABB has a structured approach to 
identifying, managing, and monitor-
ing tax-related risks. Our Tax Control 
Framework applies to all ABB com-
panies and employees dealing with 
tax-related matters. The group’s tax 
strategy is reviewed annually and 
approved by the Finance, Audit and 
Compliance Committee.
Taxes borne by ABB in 2025
$3.3 bn
50%
Profit taxes
39%
People taxes
11%
Other taxes
83
Introduction
Value creation  |  We promote social progress
Governance

COMMUNITY ENGAGEMENT 
PROGRAMS
ABB is committed to creating a more 
prosperous and sustainable future for 
the communities in which we operate. 
While leveraging our core competencies, 
we work to mitigate negative impacts 
that might occur in our value chain and to 
create long-lasting value and opportuni-
ties for these communities aligned with 
four key focus areas for our support:
•	 Equitable access to education – partic-
ularly science, technology, engineering, 
and mathematics (STEM);
•	 Environment and conservation – sup-
porting communities in biodiversity 
conservation, protecting land, marine, 
and freshwater ecosystems;
•	 Empowering communities – working to 
create a more prosperous and sustain-
able future;
•	 Emergency and disaster relief – sup-
porting local communities and em-
ployees impacted by natural disasters 
and educating our ABB community on 
disaster preparedness.
ABB recognizes volunteering as a key 
driver of both community engagement 
and employee empowerment. In 2025, 
new country-level volunteering pro-
grams were launched in both the United 
Kingdom and France. These initiatives 
build on longstanding programs devel-
oped over the years in other countries. 
Volunteering not only generates positive 
outcomes for communities but also 
strengthens ABB’s internal culture by 
fostering collaboration, purpose, and 
pride among employees. Through these 
efforts, ABB continues to create shared 
value and contribute to a more inclusive 
and sustainable society.
Empowering
communities
Create a more prosperous and 
sustainable future for communities 
in countries and territories where 
we operate, mitigating impacts 
and offering new development 
opportunities.
ABB’s focus areas for promoting social progress
Emergency
and disaster relief
Support communities and employees 
impacted by natural disasters and 
educate our employees on disaster 
relief readiness.
Environment and 
conservation
Support communities in biodiversity 
conservation, protecting land, marine 
and freshwater ecosystems, mitigating 
environmental and social impacts and 
offering new development opportunities.
Education
Ensure equitable access to Science, 
Technology, Engineering and Mathe-
matics (STEM) education and build the 
next generation’s lifelong competence 
and soft skills, leveraging technology, 
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84
Introduction
Value creation  |  We promote social progress
Governance

In 2025, ABB and our employees donated 
$9.4 million and 6,000 volunteering days. 
These contributions were divided across 
636 projects in 44 countries.
As part of our Sustainability Agenda, we 
committed to continue expanding our 
programs with the ambition of measur-
ing their impact. In 2025, we launched 
our new Community of Practice (CoP), 
including colleagues across functions 
and countries. At Group level, we set 
guidance and sign off priorities, while 
our CoP connects local practitioners 
and shares knowledge, enhancing lo-
cal capabilities.
The social topics outlined above are integral to the success of ABB’s value 
proposition. In 2026, we will continue to drive progress across these social 
impacts, including health and safety, diversity and inclusion, employee 
development, human rights, as well as community investment. In 2026, we are:
•	 Focusing on avoidance of events with a potential for serious harm to 
employees and contractors;
•	 Continuing to enhance human rights due diligence across our value chain;
•	 Increasing the proportion of women in senior management;
•	 Deepening our voluntary reporting of ABB’s tax contributions;
•	 Continuing to expand engagement programs in our communities.
We will advance these programs, embedding them further into our business 
(and value chain, where appropriate), and report our progress transparently. 
OUTLOOK
ABB’s volunteering highlights from 2025
44 countries 
engaged
$9.4 million 
donated by employees 
and business areas
6K person-days
in volunteer work
636 projects
supported worldwide
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Value creation  |  We promote social progress
Governance

CASE STUDIES
— 
EDUCATION
Enhancing engineering education 
at TalTech, Estonia
In 2025, ABB donated a set of drive 
demonstration units to Tallinn University 
of Technology (TalTech) to give students 
hands-on experience with real industrial 
equipment. The initiative strengthens en-
gineering education by helping students 
understand how drives improve process 
quality, safety, and energy efficiency.
The donation, with an estimated lifespan 
of 10–15 years, will benefit multiple gen-
erations of future engineers. It supports 
both technical learning and awareness of 
energy savings and sustainability.
This collaboration continues ABB’s 
long-standing partnership with TalTech – 
which includes internships, research 
cooperation, and previous equipment 
donations – and exemplifies ABB’s com-
mitment to advancing education, skills 
development, and employability within 
local communities.
— 
LOCAL DEVELOPMENT
Lighting up Orang Asli villages in Malaysia
In 2025, ABB Malaysia contributed 
$20,000 to the Global Peace Foundation 
Malaysia to bring solar-powered light-
ing to two Orang Asli villages in Kuala 
Rompin, Pahang. The project benefits 
around 200 members of the indigenous 
minority community who live in the 
villages by providing safe, sustainable 
access to electricity in homes, streets, 
and community spaces.
Before the installation, villagers relied on 
bonfires, petrol generators, and dis-
posable batteries, exposing families to 
health, safety, and environmental risks. 
The new solar systems improve living 
conditions, enable children to study after 
dark, and reduce pollution and household 
energy costs.
The initiative reflects ABB’s commitment 
to social progress and community em-
powerment, supporting local develop-
ment through technology that enhances 
safety, sustainability, and quality of life.
86

— 
EDUCATION
Empowering future engineers with ABB’s 
ultra-efficient motor technology
To support Malaysia’s workforce devel-
opment, ABB has equipped Universiti 
Malaya for teaching purposes with its  
ultra-efficient IE5 Synchronous 
Reluctance Motor (SynRM), ACS580 
drive, and smart sensor. These technol-
ogies represent the pinnacle of energy 
efficiency, reducing energy losses by up 
to 50 percent compared to traditional 
IE2 motors. The smart sensor enables 
real-time monitoring of motor health and 
performance, helping students learn how 
to optimize industrial operations.
This hands-on access to cutting-edge 
equipment allows engineering students 
to engage in real-world scenarios and 
develop skills in energy-efficient design 
and predictive maintenance. ABB’s con-
tribution underscores the importance of 
public-private collaboration in preparing 
future-ready talent and advancing cli-
mate resilience through education.
— 
BRIDGING THE KNOWLEDGE GAP
Safeguarding industrial expertise with 
ABB’s generative AI knowledge vault
The new ABB Ability™ Industrial 
Knowledge Vault is a generative AI 
solution designed to preserve critical 
expertise and empower industrial work-
forces. Developed in collaboration with 
Microsoft, the platform uses natural 
language processing to capture, struc-
ture, and share operational know-how in 
real time.
As experienced employees retire, 
organizations risk losing decades of 
institutional knowledge. The Knowledge 
Vault addresses this growing challenge 
by transforming fragmented documen-
tation into step-by-step workflows 
accessible via conversational interfaces. 
This allows workers to retrieve best prac-
tices instantly, reducing onboarding time 
and improving safety and efficiency. The 
solution also supports policy and proce-
dure management, ensuring up-to-date 
and role-based access to operational 
insights. By bridging this knowledge gap, 
ABB helps industries maintain continuity 
and enhance productivity in an increas-
ingly digital environment.
87
Introduction
Value creation  |  We promote social progress
Governance

GOVERNANCE
03
Corporate governance	
89
Compensation	
93
Integrity & Transparency	
100

Strong corporate governance is essential for our business 
success. ABB commits to the highest standards.
CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
ABB complies with all relevant frameworks, 
including the Swiss Code of Obligations, the 
Swiss Code of Best Practice for Corporate Gov-
ernance, and the rules of the capital markets on 
which the company’s shares are listed. Gover-
nance principles are also anchored in its Articles 
of Incorporation, Board Governance Rules, poli-
cies and procedures.
Strong corporate governance is not only 
necessary to ensure compliance but is also 
indispensable for creating sustainable value. 
Our established governance culture helps 
ABB successfully manage its business and 
realize opportunities for the benefit of all of 
its stakeholders.
This also applies to sustainability. ABB has a 
robust sustainability governance structure from 
its Board of Directors to its operating divisions: 
Our Board of Directors reviews and approves 
ABB’s Sustainability Agenda and related tar-
gets. The Executive Committee validates the 
Sustainability Agenda, is responsible for its 
implementation and ensures that sustainability 
is embedded in our business decision making. 
The Sustainability Council is the operational 
body that oversees implementation of the 
Sustainability Agenda, reviews developments, 
and monitors progress toward targets. In 
line with our decentralized operating model 
ABB Way, our business areas and their divisions 
are ultimately accountable for action plans and 
ensuring resources are available to implement 
these plans.
More details are avail-
able in ABB’s Corporate 
Governance Report.
Board of Directors
Executive Committee
Governance
and Nomination
Committee
Compensation
Committee
Finance, Audit
and Compliance
Committee
ABB’s governance structure
89
Introduction
Value creation
Governance  |  Corporate Governance

BOARD OF DIRECTORS
ABB’s Board of Directors is responsible for 
the company’s strategy. It is a diverse board; 
its members represent a broad variety of 
geographical, business, management and cul-
tural experience.
The Board’s three committees – the Finance, Au-
dit and Compliance Committee, the Governance 
and Nomination Committee, and the Compen-
sation Committee – support the Board with 
high-level expertise. Special attention is paid to 
sustainability: oversight of ABB’s Sustainability 
Agenda is the responsibility of the Governance 
and Nomination Committee; the Finance, Audit 
and Compliance Committee assists the Board 
in overseeing the integrity of the company’s 
sustainability-related reporting; and the Com-
pensation Committee ensures that ABB’s exec-
utive compensation policies are aligned to its 
Sustainability Agenda. Ultimate responsibility 
for ABB’s Sustainability Agenda, its targets and 
its annual Sustainability Statement lies with the 
entire Board of Directors.
Jennifer Xin-Zhe Li
•	 Member of ABB’s 
Board of Directors 
since 2018
•	 Member of the 
Compensation 
Committee
•	 Canadian citizen
Geraldine Matchett
•	 Member of ABB’s 
Board of Directors 
since 2018
•	 Member of the 
Governance and 
Nomination 
Committee
•	 Swiss, British and 
French citizen
David Meline
•	 Member of ABB’s 
Board of Directors 
since 2016
•	 Chairman of the 
Finance, Audit 
and Compliance 
Committee
•	 US and Swiss citizen
Claudia Nemat
•	 Member of ABB’s 
Board of Directors 
since 2025
•	 Member of the 
Finance, Audit 
and Compliance 
Committee
•	 German citizen
Mats Rahmström
•	 Member of ABB’s 
Board of Directors 
since 2024
•	 Member of the 
Finance, Audit 
and Compliance 
Committee
•	 Swedish citizen
Peter R. Voser
•	 Chairman of ABB’s 
Board of Directors 
since 2015
•	 Chairman of the 
Governance and 
Nomination 
Committee
•	 Swiss citizen
David Constable
•	 Member of ABB’s 
Board of Directors 
since 2015
•	 Member of the 
Compensation 
Committee
•	 Canadian and US 
citizen
Frederico Fleury 
Curado
•	 Member of ABB’s 
Board of Directors 
since 2016
•	 Chairman of the 
Compensation 
Committee
•	 Brazilian and 
Portuguese citizen
Johan Forssell
•	 Member of ABB’s 
Board of Directors 
since 2024
•	 Member of the 
Governance and 
Nomination 
Committee
•	 Swedish citizen
Denise Johnson
•	 Member of ABB’s 
Board of Directors 
since 2023
•	 Member of the 
Finance, Audit 
and Compliance 
Committee
•	 US citizen
Our Board members 
(as of December 31, 2025)
90
Introduction
Value creation
Governance  |  Corporate Governance

EXECUTIVE COMMITTEE
The Board of Directors has delegated the man-
agement of ABB to the CEO. The CEO and, under 
his direction, the other members of the Execu-
tive Committee are responsible for ABB’s overall 
business and its day-to-day management. Each 
member of the Executive Committee is ap-
pointed by the Board.
ABB strives to have an Executive Committee 
with the same level of diversity as its Board 
of Directors.
Giampiero Frisio
•	 President of the 
Electrification 
­business area 
since 2024
•	 Italian citizen
Brandon Spencer
•	 President of the 
Motion business area 
since 2024
•	 US citizen
Peter Terwiesch
•	 President of the 
Automation ­business 
area since 2015
•	 German and Swiss 
citizen
Sami Atiya
•	 President of the 
former Robotics & 
Discrete Automation 
business area since 
2019 (Member of the 
Executive Committee 
since 2016)
•	 German citizen
Morten Wierod
•	 Chief Executive 
Officer since 2024 
(Member of the 
Executive Committee 
since 2019)
•	 Norwegian citizen
Timo Ihamuotila
•	 Chief Financial 
Officer since 2017
•	 Finnish citizen
Carolina Granat
•	 Chief Human 
Resources Officer 
since 2021
•	 Swedish citizen
Karin Lepasoon
•	 Chief Communications 
and Sustainability 
Officer since 2022
•	 Swedish citizen
Mathias Gaertner
•	 General Counsel and 
Secretary to the 
Board of Directors 
since 2024
•	 German citizen
Our Executive Committee members 
(as of December 31, 2025)
91
Introduction
Value creation
Governance  |  Corporate Governance

Please refer to the 
Value Creation chapter 
for the ­results of the 
2025 ERM process.
ENTERPRISE RISK MANAGEMENT
Proactive and strategic risk management is 
integral to how we run our business. Our enter-
prise risk management (ERM) process takes a 
holistic approach to identifying risks that could 
impact ABB’s strategic objectives and have a 
material financial effect. Fully embedded in the 
ABB Way operating model, our ERM process 
spans all levels of the organization, considers all 
risk types, and provides leadership, including 
the Executive Committee and the Finance, Audit 
and Compliance Committee of the Board, with 
a clear view of ABB’s most critical risks. This 
insight informs strategic decision-making and 
enables us to protect and create value while tak-
ing calculated risks.
The annual ERM process is based on the con-
tinuous identification, assessment, mitigation, 
and monitoring of ABB’s most critical risks. It 
begins by defining our strategic objectives, 
then identifying risks that could prevent us 
from achieving these objectives across the 
short-, medium-, and long-term time horizons. 
Each risk is assessed for its potential impact, 
likelihood, and speed of effect. Targeted 
responses are developed, implemented, and 
monitored by dedicated risk owners. Wherever 
possible, we seek to turn risks into opportuni-
ties and to minimize downsides while generat-
ing value for ABB and our stakeholders.
The ERM process at ABB categorizes risks as 
strategic, operational or financial:
1. Strategic risks
Strategic risks include macroeconomic fac-
tors; market and technological developments; 
competitor and industry shifts; corporate 
governance requirements; geopolitical develop-
ments; and strategic planning and development 
topics. These factors can have both negative 
and positive impacts on our business and even 
lead to significant business opportunities.
2. Operational risks
Operational risks include engineering, manu-
facturing, project management, and produc-
tivity topics; health and safety; integrity and 
compliance aspects; supply chain management; 
environmental and social aspects; cyber and 
information security threats; talent attraction 
and retention. These factors can have adverse 
impacts on the day-to-day operations of our 
business, as well as positive impacts by being 
sources of competitive advantage.
3. Financial risks
Financial risks include fluctuations in currency 
or interest rates; financial disclosure and report-
ing requirements; budgeting, financial planning, 
and resource allocation; and compliance with 
tax obligations. These factors are key to en-
suring that ABB has appropriate finance struc-
tures in place and that all financial compliance 
requirements enabling us to meet our capital 
needs are fulfilled. 
2
Identification and 
assessment of risks
3
Risk mitigation planning
and implementation
4
Risk mitigation
effectiveness monitoring
1
Identification of strategic 
business objectives
ABB’s Enterprise Risk Management process
92
Introduction
Value creation
Governance  |  Corporate Governance

COMPENSATION
We aim to compensate our non-executive 
directors and executives fairly, competitively, 
and responsibly, in alignment with ABB’s 
commitment to sustainable value creation.
Therefore, our approach to compensation 
is designed to attract and retain 
high-caliber leaders.
Variable pay programs for our executives 
are based on achieving both financial and 
sustainability-related targets. Therefore, 
executive compensation outcomes reflect 
the achievements of short-term performance 
and long-term strategic targets.
93
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Governance  |  Compensation

Board compensation
1.	 Chair of the Board does not 
receive any additional com-
mittee fee as Chair of the 
Governance and Nomination 
Committee.
2.	 Member of a Committee.
3.	 Chair of a Committee.
COMPENSATION FOR THE 2025–2026 
TERM OF OFFICE
The total Board compensation for the  
2025–2026 term of office (CHF 4,220,000) was 
within the maximum amount (CHF 4,300,000) 
approved at the Annual General Meeting 
(AGM) 2025. In Exhibit 1, we set out the fees by 
member for the 2025–2026 Board term.
In 2025, we conducted a benchmark review 
against the compensation of non-executive 
Board roles from a cross-selection of publicly 
traded companies in Switzerland, excluding 
financial services companies. As a result, ABB 
will propose an adjustment to the maximum ag-
gregate compensation for the Board, resulting 
from the need to correct the fee for the Chair of 
the Board, which has remained unchanged for 
19 years, and is significantly below market ref-
erence. The fees for other Board roles, which are 
in place since 2015, remain unchanged.
EXHIBIT 1
Board fees for the 2025–2026 term of office (in CHF) by member
Name
Board
Compensation 
Committee
Finance, Audit 
and Compliance 
Committee
Governance and 
Nomination 
Committee
Total 
Compensation
Peter Voser1
1,200,000
–
–
–
1,200,000
David Constable2
290,000
30,000
–
–
320,000
Frederico Curado3
290,000
60,000
–
–
350,000
Johan Forssell2
290,000
–
–
30,000
320,000
Denise Johnson2
290,000
–
40,000
–
330,000
Jennifer Xin–Zhe Li2
290,000
30,000
–
–
320,000
Geraldine Matchett2
290,000
–
–
30,000
320,000
David Meline3
290,000
–
110,000
–
400,000
Claudia Nemat2
290,000
–
40,000
–
330,000
Mats Rahmström2
290,000
–
40,000
–
330,000
Total 
4,220,000
94
Introduction
Value creation
Governance  |  Compensation

Executive Committee compensation
COMPENSATION STRUCTURE 
DURING 2025
The compensation structure for our Executive 
Committee (EC) is designed to drive value 
creation for our shareholders and ensure align-
ment with our strategic value drivers and lead-
ing market practices.
We summarize the elements of EC members’ 
compensation structure, including their pur-
pose, link to strategy, and applicable perfor-
mance indicators in Exhibit 2, on the next page. 
In particular, the focus on financial business 
measures through our two variable compen-
sation programs, the Annual Incentive Plan 
(AIP) and the Long-Term Incentive Plan (LTIP), 
reinforces our drive to achieve our ambitious 
financial targets while also creating sustainable 
value for our stakeholders.
Further details related to the variable com-
pensation of each EC member and each com-
pensation component are specified in our 
Compensation Report 2025.
IMPACT OF SUSTAINABILITY 
PERFORMANCE ON VARIABLE EC 
COMPENSATION
Since sustainability is an integral part of ABB’s 
strategy, we incorporate a strong and direct link 
between our Sustainability Agenda and execu-
tive incentives, including our EC members.
For 2025, all EC members had two mandatory 
sustainability goals with a combined weighting 
of 10 percent of their target AIP award.
As for the LTIP granted to approximately 90 
executives in 2025, including EC members, we 
continued to include a company-wide sustain-
ability performance measure with a weighting 
of 20 percent of the executive’s LTIP grant. The 
2025 LTIP sustainability measure is represented 
by a group-wide scope 1 and 2 GHG emissions 
reduction target.
In 2025, ABB’s Compensation Committee (CC) 
conducted a review of our LTIP design to ensure 
it remains aligned with our business require-
ments and market best practices.
Thanks to our strong progress on GHG emis-
sions reduction over the past four years, we 
expect to reach our commitment (reducing 
emissions by 80 percent compared to a 2019 
baseline) well ahead of the initial 2030 timeline. 
Further improvements to such emissions re-
duction will be incremental only. The company 
could not identify, at this stage, alternative sus-
tainability measures that are material, measur-
able and auditable to be used as an adequate 
company-wide long-term target. In conse-
quence, our 2026 LTIP will not contain a sustain-
ability measure. Future vesting under our active 
2023, 2024 and 2025 LTIP grants will remain 
subject to the achievement against the plan 
specific sustainability targets, for which the 
last vesting will occur in 2028. Sustainability is 
now fully embedded in our plans and processes, 
with full accountability to our business leaders.
95
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Value creation
Governance  |  Compensation

EXHIBIT 2 
EC compensation structure during 2025
Fixed compensation –  
base salary and benefits
Variable compensation – 
short-term incentive (AIP)
Variable compensation –  
long-term incentive (LTIP)
Wealth at risk/ 
share ownership
Purpose and link 
to strategy
Facilitates attraction and retention 
of talented EC members; base salary 
compensates for the role and rele-
vant ­experience; benefits protect 
against risk
Rewards annual company, business 
area, functional, and individual per-
formance. Aligned with the company’s 
Annual Performance Plan
Rewards company performance over 
a three-year period and encourages 
creation of long-term, sustainable 
value for shareholders. Aligned 
with the company’s Long-Term 
Performance Plan
Aligns individual’s personal wealth 
at risk directly to the ABB share price 
and EC members’ interests with those 
of shareholders to maintain focus on 
ABB’s long-term success
Operation
Salary in cash, benefits in kind, and 
pension contributions
Annual awards, payable in cash after a 
one-year performance period; malus 
and clawback provisions in place
Annual grants in shares which may 
vest after three years and are subject 
to performance conditions; malus and 
clawback provisions in place
Individuals are required to hold 
ABB shares
Opportunity level
(as % of base salary)
Based on scope of responsibilities, 
personal experience, and skillset
Minimum
Target
Maximum
0%
100%
150%
Other EC members1 
Minimum 
Target 
Maximum
0%
150%
300%
CEO 
Minimum 
Target 
Maximum
0%
150%
300%
CEO 
500% of annual salary  
(net of taxes)
Other EC members 
400% of annual salary  
(net of taxes)
Performance indicators
Changes to base salary ­consider 
individual performance, future 
potential, broadening of 
responsibilities, and external 
benchmarking
Group financial results
Business area
financial results
Sustainability results
20%
70%
10%
Business 
area 
presidents
Group financial results
Sustainability results
90%
10%
CEO and 
corporate 
officers
Average EPS
Relative TSR
Sustainability
50%
30%
20%
All EC 
members
Exposure to ABB share price
1.	 EC members with legacy 
employment contracts have 
a Target LTIP grant of 100 per-
cent and Maximum LTIP op-
portunity of 200 percent.  
The higher LTIP opportunity 
for recently appointed EC 
members is largely offset by 
lower pension and other ben-
efit costs.
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Value creation
Governance  |  Compensation

TOTAL EC COMPENSATION 
FOR 2025
The total EC compensation was CHF 33.7 mil-
lion in 2025, reflecting the strong 
performance-related variable pay awards. 
This amount was substantially lower than the 
CHF 45.9 million approved at the AGM 2024 for 
the financial year 2025, reflecting the lower 
compensation levels of the newly appointed EC 
members, lower AIP payout levels, much lower 
2025 LTIP grant fair value deriving from an ap-
proximately 20 percent lower ABB share price 
on the grant date compared to the LTIP refer-
ence price fixed for the 2025 LTIP, and overall 
lower payments to former EC members.
Exhibit 3 shows the composition of 2025 
total compensation for EC members on De-
cember 31, 2025, without compensation paid 
to former EC members in 2025. The largest 
portion of the CEO’s 2025 total compensation 
was performance driven (61 percent) and repre-
sented by short-term and long-term incentives. 
For other EC members on an aggregate level, 
variable compensation represented 53 percent 
of their 2025 compensation. These outcomes 
underline ABB’s performance-based compensa-
tion philosophy.
BASE SALARY ADJUSTMENTS  
IN 2025
As a result of the regular compensation review 
for the EC, the Board and CC decided to in-
crease the salaries of four of the nine EC mem-
bers in place as of March 2025. The base salary 
of Peter Terwiesch was increased by 2.9 per-
cent to CHF 885,000, that of Sami Atiya was in-
creased by 3.1 percent to CHF 825,000, that of 
Giampiero Frisio was increased by 10.0 percent 
to EUR 885,500 and that of Brandon Spencer 
was increased by 15.0 percent to USD 885,500. 
These salary changes were made to ensure 
their total compensation opportunity does not 
fall behind their relevant target market position 
and also consider their strong performance. 
Considering that the other five EC members in 
place in March 2025 had no salary adjustments, 
this corresponded to an average 3.4 percent in-
crease on annual base salaries for EC members 
post March 2025.
1.	 Composed of 2025 base sal-
ary, 2025 AIP, 2025 LTIP grant, 
pension benefits, and other 
benefits. 2025 AIP represents 
accrued short-term incentive 
for the year 2025, which will 
be paid in 2026 after the 
publication of ABB's financial 
results. The sum of percent-
age figures may differ from 
100 percent due to rounding 
with one decimal.
EXHIBIT 3
2025 total compensation mix (in CHF) for the CEO 
and other EC members on aggregate level¹
24.7% 
Base salary
4.8% 
Pension benefits
9.4% 
Other benefits
30.1% 
Short-term incentive
31.0% 
Long-term incentive
Variable
compensation
61%
Fixed
compensation
39%
Variable
compensation
53%
Fixed
compensation
47%
CEO
24.4% 
Base salary
10.3% 
Pension benefits
12.9% 
Other benefits
27.9% 
Short-term incentive
24.6% 
Long-term incentive
OTHER EC MEMBERS
6,069,460
26,103,848
97
Introduction
Value creation
Governance  |  Compensation

REALIZED VARIABLE 
COMPENSATION IN 2025
Realized variable compensation relates to the 
AIP and the LTIP awards at the end of their re-
spective performance cycles, based on achieve-
ment of the plan related annual or long-term 
performance measures.
The average outcome of the 2025 AIP awards 
for EC members on December 31, 2025 was 
114.8 percent of target (Exhibit 4), and the 
LTIP awards that vested in 2025 (2022 LTIP) ex-
ceeded target level, with a final vesting level of 
181.2 percent of target (Exhibit 5). Further de-
tails related to the realized variable compensa-
tion of each EC member and each compensation 
component are specified in our Compensation 
Report 2025.
As a result of the previously mentioned LTIP 
design review, the Board approved to increase 
the LTIP target grant size for the CEO from 
150 percent to 200 percent of annual base sal-
ary, as of 2026, which will further align the CEO 
compensation with the market and strengthen 
the focus on long-term performance driven pay.
	
→Target AIP award corresponds 
to 100 percent of base salary.
1.	 On aggregate level, while indi-
vidual outcomes range from 
64.8 to 128.4 percent.
0%
25%
50%
75%
100%
125%
150%
175%
200%
CEO
Other EC
members1
EXHIBIT 4
2025 AIP outcome (in CHF) compared to target
0
1,000,000
2,000,000 3,000,000 4,000,0000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 10,000,000
121.8%
100%
113.9%
150%
150%
Target AIP award
Realized AIP award
Maximum AIP award
Target achievement level
Realized vesting level
Maximum vesting level
EXHIBIT 5
2022 LTIP outcome (vested in 2025) compared to target
100%
181.2%
200%
100%
98
Introduction
Value creation
Governance  |  Compensation

SHARE OWNERSHIP OF EC 
MEMBERS
The alignment of our EC members’ personal 
wealth at risk to the ABB share price and their 
interests with those of shareholders is import-
ant to us. Therefore, EC members may not sell 
their shares (except to meet tax and social 
security costs related to share vesting) until 
they achieve their personal share ownership 
requirement level.
Five out of nine EC members exceeded their 
share ownership requirements on Decem-
ber 31, 2025. The other four members have been 
appointed to the EC recently and are still in the 
build-up phase.
When considering the number of granted, 
but unvested, ABB shares of EC members on 
December 31, 2025, it is expected that the four 
recently appointed EC members who do not 
currently meet their share ownership require-
ment will do so by 2028, after vesting of their 
respective LTIP share grants or replacement 
share grants (Exhibit 6).
1.	 Based on share price of 
CHF 50.47, the 2025 LTIP 
reference price, and shares 
held and granted on 
December 31, 2025. Future 
allocation of granted, but 
unvested, shares is based on 
target achievement level and 
relevant plan-specific settle-
ment. The value of shares is 
compared against the annual 
base salary, net of taxes, on 
­December 31, 2025.
Held shares in % of net salary
Granted, but unvested shares
Share ownership requirement
EXHIBIT 6
EC shareholding compared to share ownership guideline¹
CEO share ownership
requirement (500%)
EC appointment
Morten Wierod
Timo Ihamuotila
Carolina Granat
Mathias Gärtner
Karin Lepasoon
Sami Atiya
Peter Terwiesch
Brandon Spencer
Giampiero Frisio
April 2019
April 2017
January 2021
November 2024
October 2022
June 2016
January 2015
August 2024
August 2024
0%
400%
800%
1200%
1600%
2000%
Other EC members share
ownership requirement (400%)
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Introduction
Value creation
Governance  |  Compensation

At ABB, we aim to build and maintain a 
high-performance, high-integrity culture. 
Our business must demonstrate integrity 
every day around the world to maintain our 
license to operate. This demands honesty, 
accountability, transparency, and ethical 
decision-making and relationships.
ABB’s Code of Conduct and core values 
make our expectations explicit and serve 
as the framework which underpins our 
commitment to integrity. Our expectations 
extend to our supply chain, too. We work 
with our suppliers and other partners 
to strengthen a culture of integrity and 
transparency throughout our value chain. 
INTEGRITY AND TRANSPARENCY
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Governance  |  Integrity and transparency

ABB is committed to maintaining the highest standards 
of governance across our business. We regularly review 
our approach to improve our codes and policies, training 
and standards, metrics, and reporting. We also hold our 
suppliers to account. Below is a summary of the key pillars 
of our program and our progress in 2025.
OUR INTEGRITY PROGRAM
ABB’s Global Integrity Program aims to 
drive transparency, trust, and ethical 
business practices, while deterring 
non-compliant behavior through our ro-
bust controls, processes, and culture.
The ABB Code of Conduct is the founda-
tion of our integrity program. The Code 
is our commitment – both individually 
and collectively – to uphold the highest 
standards of business ethics in our global 
operations and value chain. We expect our 
employees, business partners, and sup-
pliers to share our standards and conduct 
business with integrity.
Training represents a critical element 
of our Global Integrity Program. Learn-
ing modules are delivered both online 
and face-to-face. We actively promote 
self-driven learning, supplemented by 
bespoke and role-specific targeted train-
ing for those who face higher integrity 
risks. In addition, ABB managers at all 
levels are expected to model integrity 
behaviors and hold discussions to ensure 
team members understand the behavior 
expected from them. Integrity Commit-
tees in all business areas and divisions 
support this approach.
To track the effectiveness of our integrity 
initiatives and to assess risk, we utilize 
data analytics. Our Integrity Analytics 
Own operations
Report, a live dashboard through our in-
tegrity web portal, provides insights into 
certain indicators of our performance 
and, in the spirit of transparency, is avail-
able to our employee population. Our 
Integrity Case Dashboards are also made 
available to appropriate stakeholders as 
part of our risk assessment and manage-
ment strategy and were further enhanced 
with additional risk surveillance topics, 
including case remediation activities.
101
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Value creation
Governance  |  Integrity and transparency

ANTI-BRIBERY AND 
ANTI-CORRUPTION
ABB has a zero-tolerance policy to-
wards unethical behavior, including any 
form of bribery or corruption. A robust 
anti-bribery and anti-corruption (ABAC) 
control framework and a strong ethical 
culture are essential for complying with 
our legal responsibilities and maintaining 
our license to operate. Our ABAC training 
program is available globally. It focuses 
on upskilling employees in gatekeeper 
functions and customer-facing roles. 
The program aims to enhance core ABAC 
competencies while highlighting the 
critical role our people play in upholding 
both ABB’s integrity culture and our com-
pliance obligations. More information 
on our ABAC training can be found in our 
Sustainability Statement 2025. 
CONCLUSION OF DEFERRED 
PROSECUTION AGREEMENT
The company concluded its Deferred 
Prosecution Agreement with the U.S. 
Department of Justice on June 20, 2025, 
prior to the end of its term, in recogni-
tion that the terms of the agreement had 
been satisfied. The company also con-
cluded its obligations under the Order 
with the U.S. Securities and Exchange 
Commission on December 4, 2025, clos-
ing all enforcement aspects of the full 
and final settlement.
Area of Risk
•	 Donations & sponsorships
•	 Gifts, travel & hospitality
•	 Third-party management
•	 Books & records/internal controls
•	 Facilitation & safety payments
•	 Conflicts of interest & HR payments
•	 M&A & joint ventures
•	 Tender risk review & project review
ABAC Program Objectives
•	 Ethical business
•	 Stakeholder trust
•	 Transparent value chain
•	 Protect license to operate
•	 Speak-up culture
ABAC Program
•	 Organization, roles & responsibilities
•	 Policies & procedures
•	 Risk management & oversight
•	 Communication, training and awareness
•	 Risk assessments
•	 Data analytics & monitoring
•	 Reporting channels
Core Governing Policy & 
Procedures embedding 
ABAC controls
Code of Conduct
Global Policies and Procedures
Local requirements 
(country-specific)
Beyond the global ABAC program represented, ABB’s business areas, 
divisions, and some countries also have policies, procedures, and controls 
that provide further risk mitigation.
ABAC Framework
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Our integrity program goes beyond ABAC 
to include compliance with our regulatory 
obligations relating to global trade, anti-
trust and fair competition, data and pri-
vacy, conflicts, fraud risk management, 
cyber security, and effective reporting 
channels and whistleblower protection, 
as summarized below. In addition, in 
2025, we expanded our focus and ca-
pabilities with respect to sustainability 
related regulations.
Global trade compliance program
We act in a global environment and 
must therefore comply with applicable 
trade laws and regulations, including 
those relating to import and export 
controls, trade sanctions, and customs 
procedures. We also expect our business 
partners to do the same. ABB’s Trade 
Compliance Program includes our Global 
Trade Compliance Procedure and guid-
ance for our business in conducting daily 
cross-border transactions. Our network 
of trade officers work with other func-
tions across the organization, providing 
advice, delivering training, and support-
ing the implementation of processes to 
manage trade compliance risks.
Antitrust compliance program
We compete fairly and manage our anti-
trust risk by providing bespoke guidance 
and training to our organization and 
monitoring legal developments globally. 
Our antitrust experts also work closely 
with colleagues from ABB’s Integrity 
Investigations team to facilitate the 
investigation and remediation of any 
antitrust concerns. Importantly, a strong 
antitrust ethos permeates ABB’s mergers 
and acquisitions activities, including the 
due diligence we perform prior to invest-
ments, acquisitions, or joint ventures 
to support healthy and compliant com-
pany growth.
Data privacy and cyber security
We ensure the protection of both pri-
vacy and personal data for customers, 
employees, and other individuals. To do 
so, we implement measures to protect 
their rights and safeguard against cyber 
threats. Respecting the right to data pro-
tection is a priority for us, and we have 
adopted global data protection stan-
dards to ensure a standardized level of 
protection for personal data. We monitor 
and review compliance with data, pri-
vacy, and cyber security laws by means 
of data protection audits, assessments, 
and other controls. ABB employees are 
trained in data privacy and cyber secu-
rity, with job-specific training provided 
for selected job functions.
Reporting channels and 
whistleblower protection
ABB’s commitment to a culture of in-
tegrity and transparency means that 
we strongly encourage our people and 
external stakeholders to speak up. 
ABB employees, contractors, suppliers, 
customers, and other stakeholders can 
report suspected breaches of our Code 
of Conduct, Supplier Code of Conduct or 
other policies, as well as laws, to multiple 
channels. This includes the ABB Business 
Ethics Helpline which allows for confiden-
tial and anonymous reporting. All reports 
to the Helpline are reviewed to determine 
the appropriate assignment for address-
ing reports, subject to confidentiality 
and whistleblowing protection consid-
erations. ABB also protects against re-
taliation for reporting concerns in good 
faith and cooperating in an investigation. 
More about ABB’s approach to reporting 
channels and whistleblower protection, 
grievance, and remediation can be found 
in our Sustainability Statement 2025.
INCIDENTS REPORTED 
IN 2025
In recent years, we have seen a steady 
rise in the number of incidents reported 
to our business ethics helpline. We view 
this as a positive sign that our efforts 
to build awareness and trust in our re-
porting processes are working. In 2025, 
the rate of increase in reports per 100 
employees was slightly lower than in FY 
2024 and previous years, and we believe 
the numbers may now be stabilizing, sug-
gesting we are approaching a baseline 
level of annual reporting in the absence 
of organizational changes.
As in 2024, in 2025, we allocated inci-
dents into the following categories, as 
well as more detailed subcategories 
within each of these:
•	 Antitrust & fair competition
•	 Bribery benefiting ABB
•	 Commercial integrity & regulatory
•	 Fraud: non-self-dealing
•	 Fraud: self-dealing
•	 HSE & security
•	 Human resources
•	 Non-integrity issue
•	 Other integrity issues
In 2025, we enhanced our ability to en-
sure swift and appropriate attention, 
resourcing, and internal escalation for 
reports by refining our detailed subcat-
egories, which range from disclosure of 
confidential or commercially sensitive 
information to child labor to bullying.
The following table provides an overview 
of the number of incidents reported 
and closed through our Business Eth-
ics Helpline.
 
Business Ethics Helpline 
2025
Incidents reported
2,467
Incidents closed
2,880
 
In 2024, we reported two concerns of 
modern slavery or child labor which re-
mained under review: these cases were 
found to be unsubstantiated during 
2025. No substantiated cases of this na-
ture were reported in 2025. 
103
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Governance  |  Integrity and transparency

Our commitment to integrity and transparency 
extends beyond our own operations to every 
link in our supply chain and includes our com-
mitment to sourcing responsibly. We only work 
with suppliers who share our commitment to 
integrity, sustainability, and human rights. We 
therefore require our suppliers to comply with 
the requirements set out in the ABB Supplier 
Code of Conduct, which is part of our pro-
curement terms and conditions as well as our 
requirements for supplier qualification and de-
velopment. In addition, we work to ensure that 
responsible practices are embedded through-
out our supply chain.
ABB Supplier Code of Conduct
Our ABB Supplier Code of Conduct explains in 
detail what we expect from our suppliers. The 
Code acknowledges international human rights 
and environmental standards and conventions, 
emphasizing the role of suppliers in preventing 
and mitigating related risks, especially the 
need for suppliers to respect human rights 
across their value chain. Our suppliers are 
also expected to reduce their environmental 
impacts, including GHG emissions, resource 
usage, waste, and pollution, while protecting 
biodiversity. ABB also expects suppliers to 
demonstrate compliance with applicable regu-
latory requirements.
Additionally, suppliers to ABB are required to 
disseminate and enforce these requirements 
throughout their own supply chains and to re-
port suspected violations. To help suppliers ful-
fill the ABB requirements, the Supplier Code of 
Conduct Implementation Guide provides prac-
tical guidance on this. Furthermore, we have 
expanded our deep-dive trainings on material 
topics, such as child labor and modern slavery, 
making them available to suppliers as well as 
our own workforce.
TRACKING RESPONSIBLE SOURCING
 2025
 2024
Suppliers assessed on site (number)
132
156
High-risk supply spending in focus countries covered by SSBM (%)
80
68
Risk closure rate (%)
87
87
Contracts terminated
2
12
Employees trained on responsible sourcing (SSBM)1
223
318
Supplier teams trained on responsible sourcing
111
7912
Responsible sourcing 
1.	 Divided over different 
­training programs.
2.	  In 2024, the number of sup-
pliers trained includes train-
ings related to the updated 
Supplier Code of Conduct, 
which came into effect on 
January 1, 2024.
MANAGING RISKS IN OUR 
VALUE CHAIN
Third-Party Management program
We use our Third-Party Management (TPM) 
program to assess and manage risks and to 
onboard and monitor engagement with third 
parties across the entire value chain, including 
upstream (suppliers) and downstream (custom-
ers). Our TPM program includes the following:
•	 Risk-based front-end due diligence prior to 
considering engagement;
•	 Appointments subject to structured approval 
processes;
•	 Inclusion of appropriate integrity clauses in 
third party contracts; and
•	 Risk-appropriate monitoring over the life cycle 
of the engagement.
ABB SUSTAINABLE SUPPLY BASE 
MANAGEMENT
Our wider third-party management approach 
includes the ABB Sustainable Supply Base 
Management (SSBM) Program. As part of this, 
we assess supplier sustainability performance, 
identifying and mitigating risks. Eligible 
suppliers must complete a sustainability 
self-assessment during the onboarding pro-
cess, which includes how they manage labor, 
human rights, environmental topics, and their 
supply chains. Further due diligence will be 
104
Introduction
Value creation
Governance  |  Integrity and transparency

performed in the event of high-risk scores, in-
cluding mandatory on-site audits in focus and 
high-risk countries. Additionally, we perform 
on-site assessments of existing suppliers in fo-
cus countries using the SSBM Country-Specific 
Assessment Protocol. To enhance our risk as-
sessment, we will add supplier adverse media 
screening on Environmental, Social, and Gover-
nance (ESG) topics to the program.
Following a regular risk review, in 2025, we up-
dated our list of focus countries to reflect both 
the shifting composition of the ABB supplier 
base as well as updated risk levels for the coun-
tries in which our suppliers are based. Tempo-
rary labor agencies were added as a high-risk 
sourcing category.
We also reviewed the top ten non-conformities 
identified during on-site assessments. This list 
informs our interventions with suppliers, as 
do the issues reported to our Business Ethics 
Helpline and their outcomes (see Human Rights 
section for details).
Providing training to both employees and sup-
pliers is part of our commitment to enhance 
sustainability performance in our supply chain. 
In 2025, 223 employees were trained and 111 
supplier teams were trained on responsible 
sourcing topics.
In 2025, 132 on-site assessments were under-
taken at supplier sites. By the end of 2025, 
80 percent of our spend with high-risk suppliers 
in focus countries was covered by our SSBM 
program. If suppliers are not able or not willing 
to close non-conformities, ABB reserves the 
right to terminate relationships. In 2025, two 
supplier contracts were terminated.
CONFLICT MINERALS AND OTHER 
MINERALS OF CONCERN
Sourcing minerals and metals responsibly is a 
key focus area for ABB given the potential hu-
man rights risks involved. Our Responsible Min-
erals Program is based on leading international 
standards, such as the OECD Due Diligence 
Guidance for Responsible Supply Chains of 
Minerals from Conflict Affected and High-Risk 
Areas and other international standards. In ad-
dition, ABB is an active member of the Respon-
sible Minerals Initiative, where we lead the Asia 
Smelter Outreach team. We are exploring other 
opportunities to influence upper tiers in our 
supply chain. Although ABB is no longer subject 
to the Dodd-Frank Act, we continue to partici-
pate in these activities on a voluntary basis.
Within our Responsible Minerals Program, we 
work with suppliers to understand the smelters 
and refiners used within their supply chain 
and to move away from smelters and refiners 
which are deemed high-risk. Our engagement 
program for tin, tungsten, tantalum, and gold 
(so-called 3TG) has been in place for many 
years, ensuring a high maturity level among our 
suppliers. Within this part of the program, we 
reached a response rate of 95 percent.
Over the years, we have extended our program 
to include other minerals of concern and are en-
gaging with suppliers on cobalt and mica.
In 2025, ABB had an increased focus on mica, 
including management engagements with key 
suppliers to strengthen traceability, transpar-
ency, and compliance.
SUPPLIER SUSTAINABILITY 
RATING
In addition to the above programs, ABB is 
requesting eligible suppliers to be rated by 
EcoVadis. The resulting supplier EcoVadis score 
is taken into consideration by multiple divisions 
during supplier performance evaluation and/or 
supplier selection. This serves as an incentive 
for suppliers to implement responsible and sus-
tainable business practices and rewards suppli-
ers who have already invested in this topic.
More information about how 
responsible sourcing is inte-
grated in our Human Rights 
Due Diligence Framework is 
available in “Social Progress: 
Human Rights”.
105
Introduction
Value creation
Governance  |  Integrity and transparency

Financial calendar 2026
March 19, 2026
Annual General Meeting
April 22, 2026
Q1 2026 results
July 16, 2026
Q2 2026 results
October 20, 2026
Q3 2026 results 
January 28, 2027
Q4 and FY 2026 results 
106
Introduction
Value creation
Governance  |  Financial calendar 2026

Caution concerning forward-looking statements
The Integrated Report 2025 includes forward-looking state-
ments and information that are based largely on current ex-
pectations, estimates, and projections about the factors 
that may affect our future performance, including global 
economic conditions as well as the economic conditions of 
the regions and the industries that are major markets for 
ABB. The words “believe,” “may,” “will,” “estimate,” “contin-
ue,” “target,” “anticipate,” “intend,” “expect,” “plan”, and 
similar words and the express or implied discussion of 
strategy, plans, or intentions are intended to identify for-
ward-looking statements. These forward-looking state-
ments are subject to risks, uncertainties, and assumptions, 
including, among other things, the following: (i) business 
risks related to the volatile global economic environment; 
(ii) risks inherent in large, long-term projects served by 
parts of our business; (iii) changes in interest rates and 
fluctuations in currency exchange rates; (iv) effects of com-
petition and changes in economic and market conditions in 
the product markets and geographic areas in which we op-
erate; (v) effects of, and changes in, laws, regulations, gov-
ernmental policies, taxation, or accounting standards, and 
practices and (vi) other factors described in in our public 
disclosures, including our quarterly financial information 
booklet and Annual Reporting Suite. Although we believe 
that the expectations reflected in any such forward-looking 
statements are based on reasonable assumptions, we can 
give no assurance that they will be achieved. We undertake 
no obligation to update publicly or revise any forward-look-
ing statements because of new information, future events, 
or otherwise. In light of these risks and uncertainties, the 
forward-looking information, events, and circumstances 
might not occur. Our actual results and performance could 
differ substantially from those anticipated in our for-
ward-looking statements.

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