For the fourth year running, ABB asked Det Norske Veritas (DNV) to conduct an independent assessment of the Group’s environmental performance. Our assessment, benchmarked against ICC’s Business Charter for Sustainable Development, covered interviews and discussions with management at corporate, segment and Business Area level and relevant specialists throughout the organisation. Spot checks were performed through interviews with personnel at site level in some selected countries. This year we have observed progress against many of the principles, as described below, but there are still areas offering room for improvement. We have grouped the 16 principles into three categories: corporate position, basic activities and specific environmental performance. The result for each principle is shown in the diagram compared with the last three years’ performance. We were also asked to include an initial evaluation of ABB’s social performance. This is presented at the end of this assessment. Environmental performance ICC principles - Findings and conclusions 1. Corporate priority Continued strong support from corporate management has further strengthened the environmental performance of sites and products. ABB’s strategic shift toward alternative decentralised energy solutions and industrial IT offers environmentally sound business opportunities. ABB was rated top of its industry group for the second year running in the Dow Jones Sustainability Group Index. Conclusion: Compliance: improvement over 1999. 2. Integrated management Integration of environmental issues into both functional and operational management has increased. Many companies have implemented, or are moving toward implementing combined systems for quality, environment and occupational health and safety. Long-term environmental objectives have been established in most Business Areas. The degree of integration of environmental issues into local business strategies varies between business and country. Conclusion: Good progress: improvement over 1999 3. Process of improvement All ISO 14001 sites have improvement programs in place and have made substantial progress. Consolidated Group data shows improvements in areas such as waste management, energy consumption and emissions. Conclusion: Good progress: improvement over 1999 4. Employee education Basic environmental training in line with the ISO 14001 process continues. Spot checks indicated that, depending on the relevance of their environmental influence, 30–100% of site employees have received relevant training. Intranet training programs are implemented in many locations. Workshops and LCA training for product development and marketing continues, but does not yet cover all relevant personnel. Conclusion: Good progress: improvement over 1999 5. Prior assessment Due diligence is performed for acquisitions and divestments of sites. We were given an example of significant expenditure for clean-up in connection with the disposal of a site. Examples were also given of substantial clean-up investments for acquired sites. Conclusion: Moving forward: same level as in 1999 6. Products and services The shift into alternative energy solutions is backed by a range of new products. ABB is taking a lead in developing common industry standards for product specific requirements. Organized by the BA Sustainability Controllers, 23 Environmental Product Declarations are completed or under development, four of which have been certified. ABB has identified the need to focus on product responsibility programs since replacement is an increasing service opportunity in the marketplace. Conclusion: Good progress: improvement over 1999 7. Customer advice Environmental product declarations are increasingly used for customer advice and development of sales and marketing arguments. Updated product information is published on the Internet. Conclusion: Moving forward: improvement over 1999 8. Facilities and operations More than 40 new ISO 14001 sites were added. ISO 14001 is now implemented at 97% of all sites in the program. The number of group-specific operating performance indicators increased by six to 39. An expanded list of restricted materials was introduced. Conclusion: Compliance: same level as in 1999 9. Research Corporate research increased its activities by 20% on new environment-driven projects such as fuel cells, low emission micro-turbines, windpower generators, dry transformers and inground transmission & distribution cables. Continuous efforts are being made in the Business Areas to improve energy efficiency and reduce losses. LCA is being increasingly used. Over 80 licences of the LCA tool are issued and supported by LCA expert groups located at four corporate research centers. Conclusion: Compliance: improvement over 1999 10. Precautionary approach Typical examples are the use of LCA in product development with increased focus on the environmental impact of materials used. Conclusion: Moving forward: same level as in 1999 11. Contractors and suppliers A new suppliers’ qualification scheme stating minimum environmental requirements was introduced. Also, a program to improve monitoring of suppliers’ environmental performance was initiated in collaboration with ABB’s supply management corporate staff. Conclusion: Moving forward: same level as in 1999 12. Emergency preparedness Local sites handle emergency preparedness, as required by ISO 14001. Also, business continuity plans for all key sites are under development, and a group-wide risk management scheme to coordinate all normal risks is being prepared. Conclusions: Good progress: same level as in 1999 13. Transfer of technology ABB continues to transfer state-of-the-art technology, management systems and know-how to new and existing plants in emerging markets with the aim of achieving one global technology platform, including management training and apprentice programs. Conclusion: Good progress: same level as in 1999 14. Contributing to the common effort Programs have been prepared by 25 countries. We were given many examples of local initiatives and partnerships with universities. Significant resources have been spent on work related to the World Commission on Dams, the UN Global Compact, the WEC Greenhouse Gas Emission Reduction Program and the China Energy Technology Program. Conclusion: Compliance: same level as in 1999 15. Openness to concerns Environmental communication programs have been developed for 25 countries and five Business Areas. Communication managers are increasingly involved in communicating environmental issues. Initiatives are being taken at both corporate and local levelto conduct stakeholder dialogues. The number of sustainability issues on the Q&A section of ABB’s website increased to 23. Conclusion: Moving forward: improvement over 1999 16. Compliance and reporting Spot checks indicate that ABB sites are in compliance with laws and regulations. A Group Sustainability Report in three languages and a summary booklet in 22 languages are being produced. Country environmental and social reports are published in some countries. ABB’s website is regularly updated with environmental information and news. Conclusion: Compliance: same level as in 1999 Social performance ABB’s social policy is new and still subject to local dialogues and reviews. It is therefore premature to make any specific assessment, although we found several relevant activities at both corporate level and in the line organization; for example: