ABB in Southern AfricaSUSTAINABILITY PROFILE
THE ABB APPROACH TO SUSTAINABILITY
“We in ABB support global efforts to promote sustainability,
and we will take part in discussions in Johannesburg. But
we can do more than talk.”
Jörgen Centerman, ABB President and Chief Executive Officer,ABB Sustainability Report, 2002
ABB, the global leader in power and automation technologies,
has played a pioneering and active role in spreading the
message of sustainable development throughout the world
over the past decade, following the signing of the historic UN
Declaration on Environment and Development by world leaders
in Rio de Janeiro, Brazil.
An early mover, the group also led the way in incorporating
the principles of sustainability into all its operations and
decision-making processes when it formed an Environmental
Advisory Board in 1992. The same year, ABB signed the
International Chamber of Commerce Charter for Sustainable
Development.
In 2002, as the UN hosts the World Summit on Sustainable
Development in Johannesburg, South Africa, ABB has
undergone a profound transformation of its entire operations
to make it more responsive to our customers’ needs with a
continued effort on sustainability. ABB is already a leading
supplier of many of the new alternative technologies, including
microturbines, cogeneration systems and wind-powered
generators.
ABB believes that global poverty is the greatest threat to
the stability in the world. Being a good corporate citizen is
a vital component of the ABB philosophy. Far from being a
soft issue grounded in emotion, sustainable development
involves cold, rational business logic.
The group operates in more than 100 countries where it
employs 150 000 people, 45 000 of them in developing
countries. The support of its stakeholder base – including
employees, customers, society and shareholders is crucial.
For ABB, sustainable development involves working in
three dimensions; environmental, economic and social. The
right balance will ensure the group’s prosperity and improve
the quality of life in the communities in which it operates.
Over the past decade, ABB has taken part in a number
of global sustainable development initiatives. For example, in
2000, the group participated in the launch of the United
Nations Global Compact with nine principles of good behavior
for a global corporate citizen. The following year, ABB signed
up with “e-mission 55” an international business initiative
which calls on governments to ratify the Kyoto Protocol
without further delay.
Within its own operations, ABB believes that enhanced
environmental performance to develop eco-efficient products
increases competitiveness through optimum design, lower
costs and desirable clean products. The ISO 14001
Environmental Management System has been implemented in
almost all the group’s 551 sites throughout the world.
In addition, ABB publishes Environmental Product
Declarations (EPDs) for a growing number of core products.
The goal is to develop EPDs for all core products. An EPD
quantifies a product’s environmental performance over its
entire life cycle, based on a formal Life Cycle Assessment (LCA).
LCA is a tool to define the environmental impact during the
product’s whole life cycle, from cradle to grave.
Last year, ABB launched its new social policy, following
unprecedented consultations that included 45 round-table
discussions with stakeholders in 34 countries. The group
published its first Sustainability Report structured according
to the recommendations of the Global Reporting Initiative
(GRI) an international multi-stakeholder initiative. The GRI
guidelines are based on a “triple bottom line” reporting concept
that measures environmental, economic and social performance.
These efforts aimed at achieving a high level of
environmental awareness throughout ABB and firmly ingraining
sustainability principles into the group’s culture have been
recognised by international rating agencies. The Dow Jones
Sustainability Index has ranked ABB at the top of its industry
group for three years running.
“Corporate Social Responsibility is the commitment of business
to sustainable economic development, working with employees
and their families, the local communities and society at large
to improve their quality of life.”
World Business Council for Sustainable Development
After a decade in Southern Africa, ABB has made a significant
contribution towards supporting sustainable economic
development in the region.
ABB established a formal presence in South Africa in 1992,
following the lifting of international sanctions against the
country. Today, the company is making a major economic
contribution towards the development of economies within
the Southern Africa Development Community (SADC) regional
block, which has a population of more than 120 million.
Over the past decade, ABB has invested hundreds of millions
of rands in Southern African manufacturing facilities, participated
in many of the major infrastructure development projects in
the region, and created thousands of jobs that have sustained
households, many of them in poor areas. The group’s high
technology products and know-how have helped to improve
the competitiveness of its customers in the region.
ABB’s global strategy focuses on developing a local presence
in all its markets, including Africa. Our operations are staffed
by local people who are committed to growing our business
while contributing to economic development. Our vision is
to create value for customers, employees, shareholders and
the communities and countries where we operate by living
our commitment to sustainable development.
With more than 3 000 employees in South and Southern
Africa, ABB is committed to the development of the region.
It shares the vision of infrastucture development in the region,
and is well positioned to deliver world-class technologies and
skills to make this dream a reality.
Within Southern Africa, ABB has offices in Angola, Botswana,
Lesotho, Malawi, Mozambique, Namibia, Swaziland, Zimbabwe,
Zambia and the Democratic Republic of the Congo. The main
business is power and automation technologies for utilities
and industries.
ABB is working with Southern African utilities to realise
the goal of a regional power grid that will bring the benefits
of affordable electricity to all parts of the subcontinent. The
group contributes to the region by developing the excellence
of its people and transferring technology and know-how to
its local operations and joint ventures.
The Southern African operations have access to the latest
innovations emanating from the ABB Group’s $654 million
research and development budget that is used to finance the
activities of more than 1200 researchers at eight corporate
centres throughout world.
In South Africa, which is playing a critical role in the new
continental economic renewal plan, ABB has revenues of close
to R2bn and 2 400 employees at nine sites in Johannesburg,
Alrode, Midrand, Pretoria, Durban, Cape Town and Botshabelo.
ECONOMIC CONTRIBUTION
The ABB group, through its specialist airports management
company, Primkop Airport Management, has recently invested
R350 million of its own resources to build the Kruger
Mpumalanga International Airport (KMIA), which is situated
near to the world-famous Kruger National Park.
The development, ABB’s biggest ever single investment in
South Africa and the group’s first wholly-owned airport in the
world, has kick-started a cycle of sustainable development
with 750 people, most of them from a poor local community,
employed during the peak phase of construction.
In terms of a unique social contract, the local Mbuyane
community has a 10% stake in the development; it will also
receive a fee for each departing passenger. If traffic projections
reach the expected 200 000 passengers a year, the community
could earn other significant funds to invest in a range of
development projects.
ABB has led the way with such initiatives because it
understands the nature and scale of the sustainability challenge
in South Africa, a country that emerged eight years ago from
apartheid policies that prevented black people from
participating fully in the economic mainstream. In addition,
new emerging forms of inequality due to globalisation could
exacerbate the situation and lead to unsustainable levels of
marginalisation, vulnerability and poverty.
Reversing this legacy is a mammoth task. ABB’s contribution
has been to forge partnerships with local entrepreneurs,
community organisations, governmental and non-governmental
organisations and international agencies who share our
commitment to sustainable development.
The economic contribution in South Africa includes a
number of initiatives aimed at increasing the participation of
previously disadvantaged people in the economy, a process
that is called Black Economic Empowerment (BEE).
ABB has been at the forefront of BEE and created new
economic opportunities for black people in South Africa
through a number of policies, programmes and actions.
The company has:
• Initiated negotiations with a black investor to take a 20%
stake in ABB’s South African holding company. This transaction
will ensure that a portion of the economic value from the
company’s activities in Southern Africa accrues to previously
disadvantaged black people.
• Established joint ventures with emerging black companies,
which have created new, globally competitive engineering
businesses. In 1997 formed the first BEE company in high
voltage technologies, ABB Karebo Manufacturers. Other joint
ventures established include Desta Power Matla (distribution
transformers), together with ABB Powertech Transformers,
and ABB Kutlwanong (plastic enclosures).
• A high level of affirmative procurement across all of its
divisions. The policy encourages procurement of services
and products from mostly small and medium-sized companies.
ABB has encouraged people from within and outside the
company to start their own businesses.
• Upgraded the skills of its employees through adult basic
education and training (Abet) and skills development.
An in-house literacy programme has taught more than 100
employees to read and write, which has opened up
opportunities for further training and career development.
• A comprehensive employment equity programme fast-tracks
the development of black managers and engineers within
the company. The employment equity programme supports
the objectives of new legislation which has been introduced
to accelerate progress towards a workforce that reflects the
composition of South African society.
“ABB intends to implement its social policy thoughout its
global organisation and by doing so help raise quality of life
wherever we have a presence.”
ABB Sustainability Report, 2002
In 2001 the group launched a comprehensive social policy
after 45 round-table discussions in 34 countries. The social
policy, which commits ABB to conform to 13 social performance
principles, will be implemented in all the group’s operations.
ABB also has an ethics policy, which commits the company to
uphold the highest standards in business ethics.
Despite having the largest economy in sub-Saharan Africa,
South Africa has massive inequalities of income, and huge social
and infrastructure backlogs, which can only be confronted
through joint actions and partnerships between all stakeholders,
including government, the private sector and community-based
organisations.
ABB South Africa’s corporate social investment projects,
which have been formally running since 1994, have made a
difference in the lives of thousands of people, many of whom
live in communities with high rates of unemployment and
poverty. The projects have helped to restore hope in
communities that only knew despair.
At ABB, we believe that we can achieve the best results by
leveraging our resources – our people, management skills and
technology and not just money – through innovative
partnerships with government departments, community
organisations and other companies who support our objectives.
A Corporate Social Investment Forum, including ABB
employees and representatives of community-based
organisations, meets regularly to review progress, identify
priorities, set criteria for evaluating projects and generate new
ideas for future action.
A number of key principles underpin ABB’s corporate
social investment activities. There must be maximum efficiency
of investment, which means that ABB will not advance funds
for salaries, administration and other overhead costs. The money
must go to the people who need it.
The other emphasis is on sustainable projects that can
eventually stand on their own, without the support of ABB,
and develop entrepreneurs, managers and workers in areas
where there was previously high levels of unemployment and
poverty. In all projects, ABB adopts a hands-on approach; we
help to co-ordinate and manage activities.
There are two distinct types of corporate social investment
projects: those aimed at our own employees, their families and
the communities where they work; and those that are directed
at South African society at large. For our employees, there are
a number of projects, ranging from providing support to schools
attended by the children of ABB employees to Internet Cafés
at our facilities and adult basic education and training (ABET).
For society at large, the projects are divided into two main
areas: education and training for employment, and community
support. In education and training for employment, the emphasis
is on income-generating projects that will restore the dignity
of the unemployed through training and after-care that equips
them with the basic skills to start a business.
ABB has supported Lungisa (which means “fix it” in Nguni
languages). This is an innovative project that empowers
unemployed and disabled people by giving them the technical
training to open their own businesses, repairing household
appliances and welding.
In community support, ABB has assisted Conquest for Life
in Westbury Township near Johannesburg. The project is aimed
at unlocking the potential of the youth by encouraging them
to adopt positive lifestyles and reject the negative influences
of violence, gangsterism and drug abuse.
The ABB Group has published a photography book entitled
“What is knowledge?” to raise funds globally for an HIV/AIDS
related project in the country. Further funds have been raised
by ABB to support an AIDS orphans project.
ABB South Africa has also sponsored several graduate
students to attend a post-graduate diploma in HIV/AIDS at
Stellenbosch University and Medunsa University.
SOCIAL CONTRIBUTION
In 2000 the ABB Group undertook a case study of their
social contribution and its impact on their employees,
employees’ families and the community at large. ABB South
Africa embarked on a detailed case study together with the
University of the Witwatersrand Environmental Engineering
department. The case study was published in the group’s annual
Sustainability Report for 2001.
“I have always maintained that we cannot have a
filthy African Renaissance, and that efforts to look for
alternatives to highly polluting methods is part of our
revival as a continent.”
SA Minister of Environment and Tourism, Mr Valli Moosa, July 2000
One of the priorities of ABB is to extend its environmental
policy and management systems to all employees and activities
throughout the world, including South Africa.
In 1992 ABB signed the International Chamber of Commerce
(ICC) Charter which was the start of its global environmental
programme. The programme focused on sites and their
certification to ISO 14001 environmental management systems.
Presently we have more than 98% of sites globally (539) that
have full environmental management systems and are externally
certified.
In addition to our site programme ABB has also focused
on its products through the Environmental Product Declarations
(EPDs), which is a tool that communicates our environmental
performance. The information in the EPD is based on life cycle
assessments and is certified by external authorised bodies.
ABB South Africa has followed the example of its global
parent in adopting policies to ensure that it maintains world-
class environmental standards. Our implementation of good
environmental practice runs well ahead of South African
legislative requirements.
It involves extensive dialogue with customers, suppliers,
the community at large and government to integrate the
environmental component of the company’s “triple bottom
line” with the social and economic aspects. The result is unique
policies that are appropriate in a South African setting.
ABB has emerged as a leader in environmental care and
social responsibility in South Africa. It has won two awards as
the best company in South Africa in its industrial sector for
environmental care and Black Economic Empowerment (BEE)
from Professional Management Review.
Six of ABB’s eight operations in South Africa have already
achieved ISO 14001 certification for environmental management.
The remaining two sites have EMS systems in place and plan
for certification. The ISO 14001 environmental management
system has 39 operational performance indicators to:
• Reduce demand on resources
• Phase-out unwanted substances
• Reduce emissions and waste
• Identify potential hazards; and to
• Optimise recycling
One of the ABB companies that have achieved ISO 14001
certification is ABB Karebo Manufacturers – the first Black
Economic Empowerment (BEE) company in the field of electrical
ENVIRONMENTAL CONTRIBUTION
engineering to achieve the certification. Compliance with
the ISO 14001 significantly adds to ABB’s competitiveness and
enables exports to a number of new potential markets.
ABB also takes great care to minimise the environmental
impact of its infrastructure projects. An example is the R350
million Kruger Mpumalanga International Airport that the
company is building near Nelspruit. As part of the preliminary
work on this project, ABB did extensive environmental impact
studies that went far beyond the requirements of the law.
ABB South Africa is also supporting Bonesa, a project that
reaches 450 schools throughout the country and educates
schoolchildren about energy efficiency. This “Legacy Project”
will have a lasting impact on the country long after the World
Summit on Sustainable Development.
ABB has a common efforts programme which it drives
worldwide. The key programme is “Access to Electricity” that
will help to make a contribution towards improving the quality
of life of people throughout the world.
ABB is a global leader in power and automation technologies
that enable utility and industry customers to improve
performance while lowering environmental impact.
ABB has 150,000 employees in more than 100 countries.
ABB in Southern Africa employs 3 000 people and has
operations in Angola, Botswana, Lesotho, Malawi,
Mozambique, Namibia, Swaziland, Zimbabwe, Zambia,
and the Democratic Republic of Congo. In South Africa the
group has several empowerment companies in the areas of
high voltage switchgear, distribution transformers and
electrical enclosures.
ABB in South and Southern AfricaHead OfficePrivate Bag X37Sunninghill 2157JohannesburgSouth Africa
Tel: +27 11 236 7000Fax: +27 11 236 7001
www.abb.com/zawww.abb.com