ABB Ltd

Annual Report • Feb 28, 2025

ABB Ltd 1/1 — ABB A nnual R eporting Suite 202 4 This document includes the following reports: – Integrated Report 202 4 – Management Report 2024: - Financial Report - Sustainability Statement – Corporate Governance Report 202 4 – Compensation Report 202 4 INTEGRATED REPORT 2024 ABB’s new brand positioning “We help industries outrun – leaner and cleaner” underpins the next phase of the company’s development as a leader in electrification and automation following its successful transformation period. It articulates what ABB wants to be known for in the minds of its customers. The new brand positioning centers around the word “Outrun” and its meaning consists of two parts: Keeping ABB’s partners running consistently at high performance and at the same time helping them run more productively, efficiently and sustainably so they can outperform. “Leaner” stands for ABB’s global leadership role in automation, improving the productivity and efficiency of every industry’s critical day-to-day operations. “Cleaner” represents the company’s leadership in electrification, decarbonizing the world’s most essential industries. ABB’s new tagline is ‘Engineered to Outrun’ . The new brand positioning is in line with ABB’s purpose of enabling a more sustainable and resource-efficient future with its technology leadership in electrification and automation. About ABB ABB is a global technology leader in electri- fication and automation, enabling a more sustainable and resource-efficient future. By connecting its engineering and digitaliza- tion 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’. Our company has over 140 years of history and around 110,000 employees worldwide. Creating success Transforming industries Leading with technology Embedding sustainability Addressing the world’s energy challenges OUR PURPOSE: We enable a more sustainable and resource-efficient future with our technology leadership in electrification and automation 4 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Divisions Corporate Customers Business Areas Business Lines Electrification Motion Robotics & Discrete Automation Process Automation Our business areas Our purpose is why we are in business. It guides the Group’s strategic direction and sits at the heart of our decentralized operating model, the ABB Way. Each of our four business areas – Electrification, Motion, Process Automation and Robotics & Discrete Automation – governs their respective divisions, ensuring that we collectively deliver on our purpose through our technology leadership in electrification and automation. Our business areas pursue oppor- tunities to collaborate, driving innovation and developing common solutions to best serve our customers. At the same time, it is our divisions – 19 in total – that are closest to our customers; they hence have full ownership and account- ability for their strategies, performance and resources in order to provide the best possible service to our customers. They drive the success of ABB in their daily business. 5 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ELECTRIFICATION ABB’s Electrification business area is a global technology leader enabling the efficient and reliable use of electricity from source to socket. We collaborate with our customers and partners to solve the world’s greatest challenges in electrical distribution and energy management. Our portfolio encompasses digital and connected innovations for low- and medium-voltage, including elec- tric vehicle (EV) infrastructure, modular substations, distribution automation, power protection, wiring accessories, switchgear, enclosures, cabling, sensing and control. We also offer services to improve reliability, availability, predict- ability and sustainability of electrical systems. Global market position No. 3 Divisions • Distribution Solutions • Smart Power • Smart Buildings • Installation Products • Service Revenues $15.4 billion Employees ~52,000 6 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Global market position No. 1 Divisions • Drive Products • System Drives • Motion Services • NEMA Motors • IEC LV Motors • Large Motors & Generators • Traction Revenues $7.8 billion Employees ~22,000 MOTION ABB’s Motion business area, the largest supplier of drives and motors globally, is at the core of accelerating a more productive and sustainable future. We offer customers the complete range of electrical motors, drives, generators, and services, as well as inte- grated digital powertrain solutions. Therefore, we are able to provide our customers with energy efficient, decarbonizing and circular solutions to empower a low-carbon future. We serve a wide range of automation applications in transportation, infrastructure and the discrete and process industries. Through our domain expertise and technology our customers achieve better performance, safety and reliability. 7 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix PROCESS AUTOMATION ABB’s Process Automation business area enables customers to operate some of the world’s largest and most complex industrial infrastructures that address a wide range of essential needs – from supplying energy, water and materials, to producing goods and transporting them to market. We offer a broad range of automation, electrification and digital solutions for process, hybrid and mar- itime industries, including industry-specific integrated control and software as well as measurement and analytics solutions and services. Global market position No. 2 Divisions • Energy Industries • Process Industries • Marine & Ports • Measurement & Analytics Revenues $6.8 billion Employees ~22,000 8 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ROBOTICS & DISCRETE AUTOMATION ABB’s Robotics & Discrete Automation business area enables compa- nies to outperform and become more resilient, flexible and efficient through our value-added solutions in robotics as well as machine and factory automation. With our integrated automation solutions, our application expertise across a wide scope of industries and our global presence, we deliver tangible customer value. Our focus on innovation includes extensive work in artificial intelligence, as well as an ecosystem of digital partnerships and the expansion of our pro- duction and research capabilities. Global market position No. 2 Divisions • Robotics • Machine Automation Revenues $3.2 billion Employees ~11,000 E-MOBILITY ABB’s E-mobility division, formerly part of the Electrification busi- ness area, has been an independent business and separate operating segment since January 2023. It is reported in “Corporate and Other”. ABB E-mobility is a global leader in electric vehicle charging solu- tions, with the highest uptime and largest installed base of Direct Current (DC) fast chargers in the market. 9 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Key figures at a glance KEY FIGURES $ in millions, unless otherwise stated FY 2024 FY 2023 Change Comparable 1 Financial Orders 33,690 33,818 0% 1% Order backlog (end December) 21,221 21,567 -2% 4% Revenues 32,850 32,235 2% 3% Income from operations 5,071 4,871 4% Operational EBITA 1 5,968 5,427 10% 11% 2 as % of operational revenues 1 18.1% 16.9% +1.2 pts Income from continuing operations, net of tax 3,955 3,848 3% Net income attributable to ABB 3,935 3,745 5% Basic earnings per share ($) 2.13 2.02 6% 3 Dividend per share (in CHF) 0.90 4 0.87 3% Cash flow from operating activities 4,675 4,290 9% Net debt 1 (end December) 1,285 1,991 -35% Environmental 5 , 6 Energy consumption (GWh) 1,292 1,297 -0.4% Renewable electricity (%) 95 94 +1.0 pts Own operations emissions scope 1 and 2 (kilotons CO 2 e) 7 138 151 -9% Value chain emissions scope 3 (kilotons CO 2 e) 8 394,952 447,426 -12% Total waste sent to landfill (kilotons) 9.3 10.1 -8% Social Total number of employees (FTE) 109,900 107,900 2% Women in workforce (%) 9 27.8 27.7 0.1 pts Women in senior management positions 10 (%) 9 21.3 21.0 0.3 pts Community spending 9 11.5 -2.5 1. For alternative performance measures, see chapter Alternative performance measures. 2. Constant currency (not adjusted for portfolio changes). 3. EPS growth rates are computed using unrounded amounts. 4. Proposed by the Board of Directors and subject to approval by shareholders at the Annual General Meeting on March 27, 2025, in Zurich, Switzerland. 5. Figures are adjusted for portfolio changes. 6. When reporting figures in tons, kilotons or megatons we refer to metric tons, kilotons or megatons. 7. Scope 2 refers to market-based values. 8. In 2023, we published a “representative scenario” and a “strict scenario”. Going forward, we report the strict scenario as basis for our scope 3 emissions, taking a more conservative approach based on full energy input for certain products. 9. Percentages calculated using headcount data. 10. At ABB, senior managers are defined as employees in Hay grades 1–7, including division presidents. ABB SUSTAINABILITY RATINGS 2024 CDP Climate CDP Water CDP Supplier Engagement 1 EcoVadis ISS ESG Corporate MSCI ESG 2 S&P Global CSA score Sustainalytics ESG Risk 3 A A- A Gold 75/100 Prime status B AAA 64/100 15.2 1. The 2024 Supplier Engagement score will be available in March 2025. 2. The use by ABB 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, endorsement, recommendation, or promotion of ABB by MSCI. MSCI services and data are the property of MSCI or its information providers and are provided ‘as-is’ and without warranty. MSCI names and logos are trademarks or service marks of MSCI. 3. Copyright ©2023 Morningstar Sustainalytics. All rights reserved. This publication contains information developed by Sustainalytics (www.sustainalytics.com). Such information and data are proprietary of Sustainalytics and/or its third-party suppliers (Third Party Data) and are provided for informational purposes only. They do not constitute an endorsement of any product or project, nor an investment advice and are not warranted to be complete, timely, accurate or suitable for a particular purpose. Their use 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. 10 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 140+ years history ABB in 2024 IMPORTANT MILESTONES IN 2024 • ABB announced the approval of its Net Zero emissions reduction targets by the Science-Based Targets initiative (SBTi) : 80 percent reduction of absolute scope 1 and scope 2 (operational) GHG emissions from 2019 to 2030, and 100 percent by 2050, both in line with the 1.5°C pathway; 25 percent reduction of scope 3 (value chain) GHG emissions from 2022 to 2030, in line with the well below 2°C pathway, and 90 percent by 2050, in line with the 1.5°C pathway. • ABB opens new $100 million campus in Wisconsin, US, to support future growth in ABB’s largest market with production of electric drive technology used in a variety of industries. • Share buybacks: On April 1, ABB launched its new share buyback program of up to $1 billion, 16,715,684 shares were bought under the plan which ended in January 2025 – for a total amount of approximately $0.9 billion. • On August 1, Morten Wierod took over as the new CEO of ABB . Giampiero Frisio stepped into his role as the new President of the Electrification Business Area and Brandon Spencer as the new President of the Motion Business Area and on November 1, Mathias Gaertner assumed the role of General Counsel and Company Secretary. • On March 21, the Annual General Meeting elected two new Board members , Johan Forssell and Mats Rahmström. They replace Jacob Wallenberg and Gunnar Brock who decided not to stand for reelection. • ABB filed a Form 15F to voluntarily deregister and suspend SEC reporting on June 10, 2024. The deregistration became effective in September 2024. The company will continue to comply with its financial reporting and other obligations pursuant to applicable stock exchange listing rules in Switzerland and Sweden. ABB IN NUMBERS $32.9 bn Revenues 18.1% Operational EBITA margin 78% Reduction of scope 1 and 2 GHG emissions since 2019 >170 manufacturing sites $33.7 bn Order intake $1.5 bn R&D investment 21.3% Women in senior management positions $3.9 bn Net income 11 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix The ABB Integrated Report describes how we create value under the ABB Way – our decentral- ized operating model. It provides a comprehen- sive view of our business strategy, governance, performance, and value creation in relation to different forms of inputs used and outcomes created through the activities of our divisions and business areas, united under the ABB brand. The report integrates the most important infor- mation about our financial and sustainability strategy, targets and performance and is mainly aimed at our shareholders and investment com- munity, but also informs other stakeholders like customers, employees, partners, governments, civil society and suppliers. As a global company with stock exchange list- ings in Switzerland and Sweden, we adhere to internationally recognized standards and frame- works. In addition to performance measures prepared in accordance with US GAAP (Generally Accepted Accounting Principles), we use alter- native performance measures deemed useful in evaluating ABB’s operating results. The Integrated Report 2024 is published as part of our annual reporting suite and is avail- able in English and German. Only the original English version is binding. For environmental reasons, only a limited number of copies of the Integrated Report are printed. All other reports are published digitally. The reporting period and scope of the data cov- ers our operations worldwide and provides an overview of financial and sustainability-linked performance for the full year 2024 and reflects the status as of December 31, 2024. “We, ABB’s senior management, and the Board of Directors, take responsibility for the accuracy and integrity of the information disclosed within our Integrated Report 2024, which addresses matters that have or may have a significant effect on how we create and share value. We believe this report is aligned in all material aspects with the recommendations and standards issued by the International Integrated Reporting Framework (now IFRS Foundation).” About this report → Please refer to “Supplemental Reconciliations and Definitions” in ABB’s Q4 2024 Financial Information. 12 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Our Value Creation Model determines the structure of our report Our value creation model outlines how we create value by delivering on our purpose. In this re- port, it also serves as a guide for the structure. The value creation model outlines how we draw on inputs and, through our decentralized oper- ating model, the ABB Way, create sustainable value in the short-, mid- and long-term by trans- forming them into outputs and outcomes: de- livering leading financial performance, creating world-class technology, enabling a low-carbon society, preserving resources and promoting social progress, underpinned by a culture of in- tegrity and transparency along the value chain. The illustration of our Value Creation Model on page 34 and 35 is interactive and by clicking on the different icons and sections you will be led to the respective section in the report to learn more about our value creation. VALUE CREATION MODEL NAVIGATION Throughout the report you will find this icon, indicating in which section of the Value Creation Model you are; by clicking on it, you will return to the main illustration on pages 34 and 35. the abb way Our inputs Inputs used to run our business: • Financial • Intellectual • Natural • Manufactured • Human • Social/relationship What we do Using the inputs, we run our business activities in line with our operating model, the ABB Way What we create By transforming the inputs into products and solutions, we create value for all our stakeholders G o v e r n a n c e B r a n d P e o p l e & C u l t u r e B u s i n e s s m o d e l ABB purpose 13 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ABB ANNUAL REPORTING SUITE 2024 Our Annual Reporting Suite for the full year 2024 is filed with the SIX Swiss Exchange in Zurich, Switzerland and the NASDAQ OMX Stockholm Exchange in Sweden and can be viewed on our website. It consists of the following reports, with the Integrated Report being a condensed summary: Integrated Report English (PDF) German (PDF) Sustainability Statement English (PDF) Corporate Governance Report English (PDF) Compensation Report English (PDF) ESEF version of ABB Annual Reporting Suite ESEF version (XHTML) Financial Report English (PDF) 14 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Table of contents 01 Introduction 17 Chairman’s letter 20 CEO Q&A 24 ABB equity story 30 ABB share performance 02 Value creation 33 Our value creation model 36 Our strategic direction 38 Our business environment 42 Our inputs for value creation 44 ABB Way 47 Risks and opportunities 03 Outputs and outcomes 51 Targets and performance overview 54 We deliver leading financial performance 65 We create value through world-class technology 74 We enable a low-carbon society 83 We preserve resources 89 We promote social progress 103 We embed a culture of integrity and transparency along the extended value chain 112 We help industries outrun – leaner and cleaner: case studies 04 Good governance 125 Corporate Governance 128 Board of Directors 129 Executive Committee 05 Performance-based Compensation 133 Extracts from Compensation Committee Chair Letter 135 Board compensation 136 Executive Committee compensation 140 Sustainability-related considerations in ABB’s compensation 06 Appendix 143 Alternative performance measures 146 Key terms 148 Financial calendar 2025 15 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 01 INTRODUCTION 17 Chairman’s letter 20 CEO Q&A 24 ABB equity story 30 ABB share performance Dear shareholders, The year 2024 was marked by change at ABB and beyond. Our world faced yet more disruption – both positive and challenging. Innovation has been speeding up, driven in large parts by gen- erative artificial intelligence (AI). Economic and geopolitical volatility, meanwhile, was on the increase, and global temperatures continued to set new record highs, serving as a powerful reminder that climate change is an increasingly urgent challenge. Against that backdrop, ABB has been thriving. As industries increasingly need to do more with less, we have supported them to become more efficient, productive and sustainable, helping them outrun – leaner and cleaner. After Morten Wierod succeeded Björn Rosengren as our CEO on August 1, our business continued to deliver strong financial performance. Key enablers of our success are our expertise in elec- trification and automation. But also, our short and resilient supply chains and our decentralized operating model, the ABB Way, which empowers our businesses to make decisions close to the customers they serve. These strengths enable us to maintain output in challenging situations and respond at speed to changing circumstances and customer needs. Tackling climate change, our leading electrifi- cation and automation technologies continued to reduce energy consumption and emissions in the largest emitting sectors, including power, industry, transport, and buildings and infra- structure. A good example is our role in reducing the energy consumption of data centers, which are becoming even bigger consumers of power due to the vast energy needs of AI applications. By 2026, data centers globally are expected to consume the same amount of electricity as Japan (IEA), which makes it essential that we help them to become leaner and cleaner and ac- celerate the shift to sustainable energy sources. We can look back at a strong performance for ABB as comparable orders, revenues and profits continued to grow, despite challenging markets for some of our businesses. Thanks to this, the Board of Directors will be proposing to the Annual General Meeting a dividend of CHF 0.90 per share, in line with our policy of paying a ris- ing, sustainable dividend per share over time. We are delivering record levels of profitabil- ity compared to just a few years ago and will continue to focus on margins while driving profitable growth and further embedding the ABB Way into our organization. I am confident that by putting a strong focus on these areas, ABB has the potential to become an even better performing company in the future. The success and growth of ABB have always depended on our ability to innovate. Research and development (R&D) plays an important role in ensuring we remain relevant for customers and we have increased our R&D spend by about 40 percent since 2020 excluding the impact from divisional exits. During 2024, we made important strides in incorporating generative AI into our offerings and business processes. These solutions will help us improve energy and resource efficiency and productivity. Through innovation, we keep improving the operational effectiveness of ABB and our customers and ac- celerate decarbonization across value chains. Chairman’s letter In 2024, we began an important chapter at ABB, with the appoint- ment of Morten Wierod as CEO. On the strength of our decentralized ABB Way operating model, we were able to make further progress across several of our key priorities. Our teams remain focused on driving profitable growth while continuing to strengthen account- ability further in the divisions. Sustainability continues to be at the center of our business and customer offering. All in all, we are mak- ing sure that ABB continues to be well positioned in the long term. 17 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix “The Board of Directors and I are absolutely confident in the ability of ABB’s management team to continue to lead this great company and deliver superior value for all of our stakeholders.” PETER VOSER | CHAIRMAN OF THE BOARD OF DIRECTORS 18 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Acquisitions are another key driver of growth. We are always on the lookout to invest in busi- nesses that add value and companies that de- velop breakthrough technologies. In 2024, we extended our market and technology leadership by signing agreements to acquire established businesses, such as the power electronics business of Gamesa Electric in Spain, Siemens’ Wiring Accessories business in China, as well as smaller companies specializing in AI-based ap- plications for electrification and automation. Sustainability continues to be a key focus of our business. In 2024, our scope 1, 2 and 3 emissions reduction targets for 2030 and 2050 were val- idated by the Science Based Targets initiative (SBTi). The SBTi validation confirms that our ap- proach is science-based in accordance with the Paris Agreement on climate change. Last year also saw changes to our Board of Directors as Jacob Wallenberg decided to step down from his position after being on the board for almost 25 years. In addition, Gunnar Brock decided not to stand for reelection. I am very proud that with Johan Forssell and Mats Rahmström we have welcomed two new members with a particular focus on industrial companies and decentralized operating mod- els who complement the competencies of our board perfectly. And our board continues to evolve as we sug- gest Claudia Nemat for election at our March 2025 AGM. As a member of Deutsche Telekom’s management team she is responsible for tech- nology and innovation, covering crucial issues like cyber security and – of course – artificial intelligence. At the same time, Lars Förberg has decided not to stand for re-election and I would like to thank him for his outstanding contribu- tion to ABB’s successful transformation over the past years. The Board of Directors and I are absolutely con- fident in the ability of ABB’s management team to continue to lead this great company and de- liver superior value for all of our stakeholders. With the ABB Way, we have the right operating model in place. Our businesses are aligned with our purpose of enabling a more sustainable and resource-efficient future with our leading elec- trification and automation solutions. And most important of all, we have around 110,000 tal- ented and motivated employees who have con- sistently delivered strong results. On behalf of the Board of Directors, I would like to thank our people for another year of excel- lent performance and to say a special thanks to Björn for his outstanding leadership of our company and to Morten for a strong start. And of course, I want to thank you, our shareholders, for your trust and support. Best regards, PETER VOSER Chairman of the Board of Directors 19 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix CEO Q&A Having assumed the role of CEO in August, Morten Wierod explains how he intends to lead ABB forward, following its transformation into a better performing, more transparent and agile company. 20 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Morten, what were the highlights of 2024? How did ABB perform? This year we made good progress on many fronts. On the performance side, our financial results continued to improve, despite the un- certain economic and geopolitical environment in which we are operating. This shows that the ABB Way is the right operating model for this company. 2024 was a new record year for us in many ways as we improved on most of our financial headlines. The market for robotics continued to be challenging but given the aging global labor force and the trend for reshoring and nearshoring, we are confident in the lon- ger-term prospects of this business. On M&A we ramped up our activities signifi- cantly, although not all closed yet, announcing eight acquisitions with annual revenues over $500 million. We also launched several ground- breaking innovations. One is a next-generation robotics platform which increases business productivity and flexibility through faster, more precise and more autonomous automa- tion; another is a new concept to improve the energy efficiency of medium-voltage motors, which account for 10 percent of the world’s electricity consumption. I am particularly proud of the improvement in our employee engagement score, which rose for the sixth consecutive year to 78 percent, making ABB a best-in-class company. You succeeded Björn Rosengren as CEO on August 1. How were your first months in the new role? Are you planning to make any changes? My first five months as CEO have been energiz- ing. ABB is in good shape and I have the privi- lege to partner with a great leadership team, including the new Electrification and Motion Presidents. What’s made the transition easier is that I have been deeply involved in ABB’s transformation from the start, having led the implementation of our successful decentralized operating model, ABB Way, in the two largest of our four business areas. In terms of where we go from here, the ABB Way is here to stay. That means we will maintain consistency in our ways of working, guided by our purpose. We will continue to focus on ac- countability, transparency and speed to build a high-performance, high-integrity collaborative culture and to actively manage our portfolio. Given my experience at ABB, I believe I am well positioned to challenge and guide the business areas and divisions to reach higher and deliver even better profitability and growth – both or- ganic and acquired – in line with our targets. We have also launched a new global brand posi- tioning for ABB to increase customers’ under- standing of what ABB does and how we create superior value for our customers. Increasing familiarity with what ABB does represents a significant commercial opportunity for us and should also help ABB attract top talent. Driving profitable growth is a priority for you, how do you plan to achieve that? Are you fo- cusing on ramping up M&A? Following our transformation, we are well po- sitioned to capitalize on the trend towards electrification and on the growing demand for automation as companies seek to improve their productivity and flexibility. We ended the year with about 60 percent of our revenues on a growth mandate, which early in 2025 changed to 70 percent in growth mode. Our management compensation and strategic priorities have been adjusted accordingly. We will drive organic growth by increasing investments in R&D and capitalizing on our technology leadership, which is based on best- in-class hardware operated with embedded software and control functions. Approximately 60 percent 1 of our products and services are digitally enabled and over half 1 of our R&D pro- fessionals are dedicated to software. At the same time artificial intelligence (AI) is becoming an increasingly important driver of how we cre- ate value for the industries we serve, and we are committed to responsible development and use. When it comes to M&A, we have been steadily building up a strong pipeline of acquisition targets. With the deals announced already we should be within our average target range of adding 1 to 2 percent of revenues via acquisitions. What are your capital allocation priorities? Our goal is profitable growth. That means our first priority is to fund organic growth through investments in R&D and production capacity. Beyond that, our policy is to pay a rising, sus- tainable dividend over time. With our remaining free cash flow, we intend to increase our M&A activities. And as we announced a new, larger program of up to $1.5 billion for 2025, share buybacks will remain on our agenda, but ulti- mately, the utilization level of buyback programs depends on how much we spend on M&A. 1. Management estimates. 21 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix What is your approach to investing in R&D and technology? What about venture capital investments? R&D investments are driven by the divisions to foster innovation that creates the most mean- ingful value for our customers. We are commit- ted to keep our R&D investments to between 4.5 and 5 percent of our revenues. Our technology pipeline speaks for itself. This year, we introduced our next generation of SF 6 - free switchgear solutions for applications up to 24 kV. These will help our customers comply with regulations in the European Union and California, which are banning SF 6 gas, a potent greenhouse gas, in new electrical equipment up to 24 kV. On the venture side, we continue to acquire minority stakes in promising start-ups, having invested in more than 30 companies in the past five years. Start-ups are an important part of our R&D ecosystem, especially when it comes to specialized software and AI. ABB has delivered another record margin of 18.1 percent, already near the top of your tar- get range. Do you think it’s time to raise your targets? We raised our margin target quite recently, in November 2023, to an Operational EBITA margin in the range of 16–19 percent. We are close to the top of that range, but we are not there yet. Once we have achieved this level, we will deter- mine what the next steps are for ABB. I believe the best is yet to come for ABB. We are starting 2025 with some 30 percent of our divisions still having a “profitability mandate”, which means they can improve their margins further. Some divisions have achieved very high levels of profitability supported by a strong market environment and we want to ensure these levels are sustainable throughout the cycle. With our new ways of working, we are a more agile and resilient company. You said that the ABB Way operating model is here to stay. How can it create even more value for ABB? I believe we can build further on the ABB Way to support both growth and margin. At the mo- ment, accountability is with our divisions, which are the highest operating level of the company, but we intend to move it even deeper, to the level of business lines and product groups. I have seen the success of embedding the ABB Way even further into our divisions in my previous role in Electrification. You mentioned the new brand positioning to improve understanding of what ABB does. What is that about? Our new brand positioning underpins the next phase of ABB’s development as a leader in electrification and automation following our successful transformation period. It articulates what ABB wants to be known for in the minds of our customers and focuses on what we have learned are their main business needs and where we at ABB can provide superior value, which is helping industries become leaner and cleaner, or as we say – helping them “outrun”. What kind of a leader are you? I believe in keeping things simple and efficient, speaking up and taking ownership. My approach is to empower people with accountability and trust, and I expect transparency and ownership in return. What counts for me is a winning mind- set and approaching business as a team sport. We want to win but work should also be fun. My motto is: even better, together. How are you doing on sustainability? We are making good progress towards our sus- tainability targets and have embedded sustain- ability even further into our divisions. Versus our 2019 baseline, we cut scope 1 & 2 greenhouse gas emissions by 78 percent, and our scope 3 emissions were reduced by 8 percent compared to the 2022 baseline, putting us well on track to achieve our targets. We also helped our custom- ers avoid 66 megatons of emissions throughout the lifecycle of our products sold in 2024 with our energy and resource efficient technologies as compared to alternative solutions. Our emissions reduction targets for 2030 and 2050 were validated by the Science Based Targets initiative (SBTi), affirming that they are in accordance with the Paris Agreement on climate change. Our focus now is on achieving these targets and helping our customers on their jour- neys. The divisions are in the lead on implement- ing the changes needed to make these a reality. “We will continue to focus on accountability, transparency and speed to build a high- performance, high-integrity collaborative culture and to actively manage our portfolio.” MORTEN WIEROD | CHIEF EXECUTIVE OFFICER 22 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix We also improved gender diversity, increasing the number of women in senior management po- sitions to 21.3 percent, and focusing on safety; our lost-time injury frequency rate stands at 0.15, down from our 2019 baseline of 0.24. How is the turnaround of the E-mobility busi- ness going? Is an IPO still planned? The turnaround of ABB E-mobility is progress- ing. It now has a focused and modular portfolio and launched its flagship A400 charger during the year. While an impact on order numbers is not yet visible, it has seen some very good customer feedback so far. We will reassess the timing for a potential IPO at a later stage, as the business and the market need to be fit for such a move. Final question: after five months as CEO, how are you finding the job? I’m enjoying it immensely. I have been doing a lot of travelling, especially to meet customers and colleagues from parts of the business that I was less familiar with when I took over the role. I have also met many investors and other stake- holders. It’s been a very positive experience – ABB is well-regarded as a technology leader and partner that is well positioned to continue bene- fiting from key global megatrends. I want to thank everyone at ABB for the strong support that I have received since I became CEO, especially my colleagues on the Executive Committee. We have a highly experienced, ex- cellent team running the company, as well as around 110,000 talented people who have deliv- ered another year of excellent performance. 23 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ABB equity story ABB is well-positioned in a changing world: Our global market-lead- ing positions in electrification and automation strategically posi- tions us to capitalize on the long-term megatrends characterized by the energy transition towards electricity and integration of new energy sources, demographic shifts and the need for an increasingly flexible and efficient manufacturing set-up. Future-proof ABB purpose and customer offering aligned with secular trends Our Purpose We enable a more sustainable and resource-efficient future with our technology leadership in electrification and automation 1. IEA World Energy Outlook 2024, Announced Pledges Scenario 2. United Nations World Population Prospects 2024 Our offering Supports customers to: More electricity Electricity demand growing ~9× faster than total energy demand in 2023–2030, resulting in ~70% higher average annual investment into electricity networks in 2024–2030 (vs 2016–2023) 1 Higher energy efficiency ~45% of the world’s electricity is converted into motion by electric motors yet only ~23% of the world’s electric motors are optimized through the control of drives New energy sources Share of low-carbon sources in global energy mix to increase +50% – points from ~20% today to ~70% in 2050 1 Shrinking labor force Global number of working age people (15 to 64 years) per retiree (65 years or over) to fall by ~24% in 2023–2035 2 • Reduce waste and increase circularity • Reduce carbon intensity • Increase labor productivity • Increase energy efficiency • Increase flexibility • Reduce footprint • Reduce downtime • Increase safety and improve working environment Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Our equity story is based on five pillars: 1. Market leader with world-class technology Our market-leading position is based on cutting-edge technology including value derived from software, our ability to scale, decades-long domain expertise and close customer relationships. Our four business areas have market-leading positions in their respective market segments. This gives us strong economies of scale and we can achieve profitability levels that support continued investments in R&D. These invest- ments help us maintain and improve our man- ufacturing assets, allowing us to defend and strengthen our leading market positions in elec- trification and automation. Our cutting-edge technology, which includes both hardware and software, creates superior customer value as we help industries optimize, electrify and decarbonize their operations. Being present in various verticals for many de- cades has enabled us to build unique domain expertise as well as a large installed base and strong long-term relationships with end-cus- tomers and channel partners. Our deep under- standing of customer needs and operations is at the root of ABB’s customer value creation. 2. ABB Way – Accountability, transparency and speed Through the period of 2019–2023 ABB has trans- formed into a more agile and efficient company where accountability, transparency and speed are fostered through the implementation of our decentralized operating model, the ABB Way. The ABB Way has been an integral part of making 2024 another record year for financial performance and under the leadership of our new CEO, Morten Wierod, we are fully commit- ted to consistency in the ABB Way operating model. This is founded on our belief in having: 1. operating decisions made close to customers; 2. select common processes and 3. a strong performance management system. In our decentralized model, operating decisions are taken close to customers in our divisions, which have full ownership and accountability for their respective businesses, including R&D, Capital expenditures (CapEx), strategy and M&A. These businesses benefit from select common processes linked to ABB brand, human capital, compliance and integrity. Each division should benefit from being part of the ABB Group. Our leaders are encouraged to cooperate where there are synergies and it makes sense for the business. Lastly, our strong performance man- agement system ensures performance can be tracked quickly and easily with standard key performance indicators (KPIs) to facilitate speed in decision making. Each division is given a man- date of stability, profitability or growth, which translates into strategic priorities and appropri- ate targets that are supported by incentives. Looking forward, we aim to move accountability further down within the organization, empow- ering business line leaders with strategic man- dates and corresponding incentives to further drive results. Clear mandates and accountability at the business line level will further enhance transparency and operational speed across the organization. Digital content in our offering to support gross margin and industry leadership in technology Continue to develop Industrial Software and Digital services organically and make bolt-on acquisitions: • Invest to create synergies with our offering • Return on investment • Growth Embedded software enables differentiation VALUE FROM SOFTWARE around 60% of software, products and services are digitally enabled ¹ Software or digitally enabled products and services 83% Products and solutions 17% Services 1. Management estimates based on FY 2023 orders. 25 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 3. Increasing growth rates We target an average comparable revenue growth of 5–7 percent through the economic cycle. In addition, we want to utilize our strong balance sheet for acquisitions, adding 1–2 percent of rev- enues on average through the economic cycle. The higher comparable growth ambitions are supported by our reshaped business portfolio, working in the ABB Way operating model and our exposure to accelerating megatrends and sustainability demand drivers. At the same time, we aim to have a high pace of acquisitions. The responsibility to build the pipeline of potential targets has been trans- ferred to the divisions and each management team is responsible for adding the necessary technology and footprint for achieving market leading positions. Acquisitions can be made in all divisions to fill gaps in technology, however, only divisions with a growth mandate are active in strategic acquisitions. In 2024, we accelerated strategic partnerships and bolt-on acquisitions led by our divisions, completing nine new and eight follow-on ven- ture capital investments and seven bolt-on acquisitions. Annual revenues from all deals an- nounced this year put us within our target range for inorganic growth, and each business has built good target pipelines. We are making prog- ress but still have some way to go before fully reaching our desired M&A performance culture. Internal 02 Working in ABB Way operating model with divisions accountable for growth with decision-making closer to the market • ABB Way operating model – transferred operating decisions to divisions. Accountable for organic and inorganic growth • Clarity and consistency on strategic mandate in businesses • 70% of revenues with growth mandate Internal 01 Reshaped portfolio around the ABB purpose of increased sustainability and resource efficiency through electrification and automation • Exit of EPC business • Completed exit of three divisions • Focus on quality of revenues • Continuous business portfolio assessment Accelerating megatrends and sustainability drivers for electrification and automation • The world going electric – Energy security – Energy efficiency – Automation • Global carbon reduction targets • Regulations – reporting standards • Impact on corporates operational performance due to rising cost of carbon • Customer, employee and shareholder focus External 03 5–7% average Comparable growth through economic cycle Revenues Comparable revenue growth 6% avg USD bn % 10 15 20 25 30 35 -5 0 5 10 15 2024 2023 2022 2021 2020 2019 26 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 4. Improving performance After several years of transformation to a more sustainably profitable company, there is now an increased focus on growth. It goes hand in hand with continuous improvements in ROCE and Operational EBITA margin, which is expected to remain at a best-in-class level of greater than 18 percent, even when achieving a higher pace of acquisitions. Our new ways of working are yielding results, and we continued to improve financial per- formance, achieving new all-time high (ATH) levels for several KPIs in 2024. We are actively enabling a low-carbon society as well as work- ing with our customers and suppliers to imple- ment sustainable practices across our value chain and the life cycle of our products and solutions. We are equally committed to driving social progress, along with our suppliers and in our communities. 20,000 25,000 30,000 35,000 $ in millions % 0 1,000 2,000 3,000 4,000 $ in millions % 0.00 0.50 1.00 1.50 2.00 2.50 3.00 2024 2023 2022 2021 2020 $ per share 0 2,000 4,000 6,000 $ in millions new ATH % 0 5 10 15 20 25 2024 2023 2022 2021 2020 % 0 100 200 300 400 500 600 2024 2023 2022 2021 2020 Ktons CO 2 e new ATH -10 0 10 20 2024 2023 2022 2021 2020 REVENUES 0 100 200 300 2024 2023 2022 2021 2020 FREE CASH FLOW AND CONVERSION RATE BASIC EPS 5 10 15 20 2024 2023 2022 2021 2020 OPERATIONAL EBITA RETURN ON CAPITAL EMPLOYED (ROCE) SCOPE 1&2 GHG EMISSIONS Operational EBITA Operational EBITA margin % All-time-high (ATH) Scope 1&2 GHG emissions ROCE Target range >18% All-time-high (ATH) Revenues Comparable growth % Free cash flow % of net income 11.1 14.2 15.3 16.9 18.1 21.1 22.9 16.5 14.9 10.3 Basic EPS 27 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 5–7% average Comparable revenue growth through economic cycle Excluding FX impacts, acquisitions and divestments 16–19% Operational EBITA margin (annual) Dividend policy rising sustainable dividend per share over time ~ 100% FCF conversion to net income (annual) At least high single-digit % EPS growth through economic cycle (Basic EPS) 1–2% average Acquired revenue growth through the economic cycle Target is the net of acquisitions and divestments >18% ROCE (annual) Excluding transformational deals FINANCIAL TARGETS: 28 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 5. Rewarding shareholders The creation of sustainable long-term share- holder value is a key priority. Our compensation programs and policies are designed to encour- age performance improvement without taking excessive risks. The company’s share ownership requirements for Executive Committee mem- bers are aligned with market practice and result in wealth at risk for each Executive Committee member which is aligned with shareholder interests. Our strong balance sheet and cash generation provides the capacity and flexibility for both solid cash distribution while still ensur- ing the financial strength to invest in organic and acquired growth. We are committed to a sustainable rising dividend per share over time. Additionally, our capital allocation priorities state that we distribute any excess cash to our shareholders via buybacks. In 2024, ABB invested $845 million in capi- tal expenditures (CapEx). Non-order related R&D investment was $1,469 million in 2024 or 4.5 percent of revenues for the year. The 2023 declared dividend amounted to $1,804 million. With respect to the year ended December 31, 2024, ABB’s Board of Directors has proposed to distribute a dividend to shareholders in the amount of CHF 0.90 per share. This is subject to approval by shareholders at the Annual General Meeting on March 27, 2025. The proposal is in line with our dividend policy to pay a rising, sus- tainable dividend per share over time. In April 2024, we launched a new share buyback program of up to $1 billion that ran until the end of January 2025. Together with the prior share buyback program, which ran from April 2023 to March 2024, we repurchased a combined value of $1.0 billion during the year 2024. ABB announced a new share buyback on January 30, 2025, as we plan to continue our share buybacks for the full-year 2025 in line with our capital allo- cation priorities. 1. 2024 dividend per share of CHF 0.90 is proposed by the Board of Directors and sub- ject to approval by shareholders at the Annual General Meeting on March 27, 2025. 2. Calculated based on the share price at December 31. CHF % 0,6 0,8 1,0 DIVIDENDS AND SHARE BUYBACKS 2015–2024 Dividend per share (DPS)¹ Dividend yield² 0 1 2 3 4 5 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 >$30 billion cash returned to shareholders over last 10 years Capital Allocation Priorities: 1. Fund organic growth, R&D, CapEx at attractive returns 2. Rising, sustainable dividend per share over time 3. Value-creating acquisitions 4. Returning additional cash to shareholders via share buybacks $17 billion dividend $13 billion buybacks 29 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ABB share performance In 2024, the price of ABB Ltd shares listed on the SIX Swiss Exchange (SIX) increased 32 percent, while the Swiss Market Index (SMI) increased 4 percent. The price of ABB Ltd shares on the Nasdaq Stockholm increased 34 percent, com- pared to the OMX Stockholm 30 Index, which increased 4 percent. Total shareholder return (including dividends) of ABB Ltd shares listed at SIX was 35 percent during 2024. On May 23, 2023, ABB delisted its American Depositary Receipts (ADRs) from the New York Stock Exchange. In the period between June 1, 2023, and May 31, 2024, the 12-month US Average Daily Trading Volume (ADTV) in ABB’s ADRs fell below 5 percent of the ADTV worldwide. As a result, ABB met the require- ments to apply to deregister and terminate the reporting obligations for its debt and equity instruments under the U.S. Securities Exchange Act of 1934, as amended. ABB voluntarily filed to immediately suspend its reporting obliga- tions under the U.S. Exchange Act with the SEC Form 15F. Filed on June 10, 2024, this became effective in September 2024. ABB continues to comply with its financial reporting and other obligations pursuant to applicable stock ex- change listing rules – in particular the Listing Rules of SIX Swiss Exchange and the Nasdaq Stockholm Rulebook. In 2024, approximately 28 percent, 26 percent, 25 percent of shares issued were held in the United States, Switzerland and Sweden, respec- tively. The ten largest individual shareholders accounted for approximately 41 percent of the share capital on the same date. On December 31, 2024, 77 percent of the shareholder base was made up of institutional investors with retail investors reaching 19 percent. On December 31, 2024, members of the Group Executive Committee owned a total of 611,418 shares in ABB. Members of the Board of Directors owned a total of 562,303 shares in ABB. Total owner- ship of ABB shares held by the Group Executive Committee and the Board of Directors corre- sponds to less than 1 percent of the capital and voting rights. KEY DATA FY 2024 FY 2023 FY 2022 Dividend per share (CHF) 0.90 1 0.87 0.84 Votes per share 1 1 1 Basic earnings per share (USD) 2 2.13 2.02 1.3 Total ABB stockholders’ equity per share (USD) 3 7.88 7.28 6.85 Dividend payout ratio (%) 4 47% 51% 70% Weighted-average number of shares outstanding (in millions) 1,844 1,855 1,899 1. Proposed by the Board of Directors and subject to approval by shareholders at the Annual General Meeting on March 27, 2025. 2. Calculation based on weighted-average number of shares outstanding. 3. Calculation based on the number of shares outstanding at December 31, 2024. 4. Dividend per share (converted to US dollars at year-end exchange rates) divided by basic earnings per share. 30 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix DISTRIBUTION OF SHAREHOLDINGS BY COUNTRY BREAKDOWN OF SHAREHOLDERS BY TYPE 28% United States 26% Switzerland 25% Sweden 9% UK & Ireland 8% Continental Europe 3% Rest of World 77% Institutional investors 19% Retail positions 3% Miscellaneous 1% Company-related holders Zurich Average daily traded number of shares: 2.85 million STOCKHOLM Average daily traded number of shares: 0.57 million Source: FactSet. Source: Company data ABB Swiss Market Index Rebased ABB OMX Stockholm 30 Index Rebased 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 Jan 2024 Feb 2024 Mar 2024 Apr 2024 May 2024 Jun 2024 Jul 2024 Aug 2024 Sep 2024 Oct 2024 Nov 2024 Dec 2024 240 280 320 360 400 440 480 520 560 600 640 680 Jan 2024 Feb 2024 Mar 2024 Apr 2024 May 2024 Jun 2024 Jul 2024 Aug 2024 Sep 2024 Oct 2024 Nov 2024 Dec 2024 Low: 35.28 High: 52.12 Year end: 49.07 Low: 424.00 High: 647.00 Year end: 595.4 CH F SEK 31 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 02 VALUE CREATION 33 Our value creation model 36 Our strategic direction 38 Our business environment 42 Our inputs for value creation 44 ABB Way 47 Risks and opportunities Our value creation model We create value for our stakeholders through our technology leadership in electrification and automation, building on our decentralized operating model to enable a more sustainable and resource-efficient future. In everything we do, we strive to consider how ABB impacts and is impacted by our stakehold- ers and the business environment. We define value creation as the transformation of our inputs into outputs and outcomes that fulfill our purpose of enabling a more sustainable and resource-efficient future. We collaborate closely with our stakeholders across ABB’s value chain and consider megatrends that shape our busi- ness environment in order to: • create value through world-class technology; • deliver leading financial performance; • enable a low-carbon society; • preserve resources; • promote social progress; and • embed a culture of integrity and transparency. To measure the success of our value creation, we leverage a broad set of qualitative and quantita- tive key performance indicators (KPIs) of which a subset is included in the illustration of our value creation model. Moreover, in the following chapters we report in more detail on our value creation inputs and how we turn them into out- puts, as well as on the business environment in which we operate. 33 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix TARGETS AND AMBITIONS 2024 PERFORMANCE We deliver leading financial performance • Comparable revenue growth: 5–7% • Operational EBITA margin: 16–19% • ROCE: >18% • FCF conversion to net income: ∼100% • EPS: At least high single-digit growth • 3% comparable revenue growth • 18.1% operational EBITA margin • 22.9% ROCE • 100% FCF conversion to net income • $2.13 basic EPS, +6% year-on-year We create value through world-class technology • Invest to maintain market-leading technology in electrification and automation through organic and inorganic investments • Orders from products that are digital or digitally enabled: ~60% 3 • Priority patents, utility models and design applications filed: >750 We enable a low-carbon society • Reduce scope 1+2 GHG emissions by at least 80% by 2030 vs 2019 • Reduce scope 3 GHG emissions by 25% by 2030 vs 2022 • Ambition to help our customers avoid emissions through- out the lifetime of products sold between 2022 and 2030 • 78% reduction of scope 1+2 GHG emissions since 2019 • 8% 4 reduction of scope 3 GHG emissions since 2022 • 66 Mt GHG emissions avoided through products sold in 2024 We preserve resources • Send zero waste to landfill while reducing waste generation by 2030 • Cover at least 80% of products and solutions with our Circularity Approach by 2030 9 • 5.8% of total waste sent to landfill • Circularity score to be calculated after assessing a representative portfolio share (currently 41% assessed) 10 We promote social progress • Achieve a top-tier employee engagement score • Increase proportion of women in senior management roles 5 to 25% by 2030 • Expand programs for community engagement • Gradual reduction in LTIFR 11 • 78/100 employee engagement score • 21.3% women in senior management roles • $9 mn donated and ~6,105 person-days volunteered • 0.15 lost-time injury frequency rate We embed a culture of integrity and transparency • We aim to embed a culture of integrity and transparency across the value chain • Trust KPI 6 : 55% of reporters 7 • Engagement KPI 8 : 82% of employees with online access 7 Financial • Total stockholders’ equity: $15,060 mn • Total liabilities: $25,297 mn Intellectual • Percentage of R&D employees in software development: >50% • R&D spend: 4.5% of revenues • Number of new venture-capital investments: 9 and 8 follow-on investments Natural • Energy consumption: 1,292 GWh (95% of electricity consumption come from renewable energy sources) • Total water consumption in areas at water risk incl. high-water stress areas: 283,123 m³ Manufactured • Book value of property, plants and equipment: $4,177 mn • Number of manufacturing sites: >170 (number of countries with manufacturing sites: >40) • Share of local-for-local production 1 : ~95% Europe, ~85% China, ~75% USA Human • Diverse workforce: 112,769 employees representing 174 nationalities as of December 31, 2024 • Average hours of training per year and employee 2 : 8.4 • Safety observation tours (SOT) rate: 5.4 Social and relationship • Customer base evenly distributed among the three regions • Numerous partnerships with universities and research institutions STRATEGIC DIRECTION 1. Management estimate based on FY2023 revenues. 2. Includes tools such as My learning, Harvard Spark, Harvard Manager Mentor and LinkedIn Learning and cov- ers both leadership and func- tional/technical learnings, for internal employees. 3. Management estimate based on 2023 orders. 4. In 2023, we published a “repre- sentative scenario” and a “strict scenario”. Going forward, we report the strict scenario as the basis for our scope 3 emissions, taking a more conservative approach based on full energy input for certain products. 5. At ABB, senior managers are defined as employees in Hay grades 1–7. 6. Rate of severity level 1 and 2 investigations where the re- porter disclosed their identity, as a measure of trust in the re- porting system and integrity program. 7. Year 1, 2, 3 and 4 (January 1, 2021, to December 31, 2024). Management estimate. 8. Volume of unique visitors on the Integrity Awareness Portal for integrity learnings. 9. Based on revenues from hard- ware-based products and solu- tions, where granularity of fi- nancial systems allows. Service revenues are excluded. 10. The circularity score of the as- sessed products and solutions is to be calculated once a repre- sentative share of the portfolio has been assessed. 11. Zero harm to our people and contractors – we aim for a gradual reduction in lost time from incidents. • Customers • Employees • Governments and civil society including NGOs • Investment community • Partnerships • Suppliers • Energy transition • Demographic shifts • Geopolitical fragmentation • Digitalization and AI STAKEHOLDERS OUTPUTS AND OUTCOMES KEY MEGATRENDS INPUTS THE ABB WAY OUR VALUE CREATION MODEL • Decentralized setup • Performance management • Capital allocation • Portfolio management • Positioning • Reputation • Values • People • Leadership • Code of Conduct • Internal control & compliance • Risk management • Policies and procedures ABB PURPOSE B U S I N E S S M O D E L P E O P L E & C U L T U R E This icon on the subsequent pages signifies your location within the value creation model. G O V E R N A N C E B R A N D You are here in the value creation model. Our strategic direction ABB’s strategic direction builds on our purpose and guides our 19 divisions in collectively cre- ating superior value for all our stakeholders. While we operate in a decentralized set-up, our strategic direction enables us to harness the right inputs and efficiently transform them into outputs aligned to our shared objectives and targets. Our lean and effective corporate functions at Group level set the frameworks for financial and sustainability performance, capital allocation, portfolio management, people and culture, governance, and brand that inform our strategic direction and help us embed sustainability in everything we do. Our divisions – as the highest operating level at ABB – have full ownership and accountability for their strategies, performance, and resources. They are expected to take stra- tegic and operational decisions in line with our long-term ambitions: • Striving for market leadership across our respective market segments and enhancing our technology and digital leadership through software-enabled products and solutions and stand-alone software and digital services. • Retaining innovation leadership by investing in R&D, scouting for new technologies, and collaborating with customers, promising start-ups, universities and industry leaders. • Actively managing our portfolio to future-proof ABB by securing exposure to strong long-term market trends. This includes organic growth and portfolio adjustments, as well as adding technology and geographical footprint. • Embedding sustainability in all our processes and across our value chain. By actively pursuing these long-term ambitions, our divisions are able to strengthen our lead- ership in electrification and automation. Our products and solutions position ABB as a key player in accelerating the energy transition for a net-zero future by optimizing, electrifying and decarbonizing industry, buildings, power, and transport – sectors that together account for over 80 percent 1 of global energy-related emis- sions. Our purpose and commitment to enable a more sustainable and resource-efficient future is also reflected in our Sustainability Agenda, which outlines ambitious targets across the three pillars “enabling a low-carbon society”, “preserving resources” and “promoting social progress” and is underpinned by our commit- ment to embed a culture of integrity and trans- parency along our extended value chain. In line with our decentralized operating model, our divisions are expected to pursue our stra- tegic direction, deliver on our long-term ambi- tions and, consequently, are also accountable for their sustainability performance. Our busi- ness areas and divisions work closely with our customers to deliver on the three pillars of our Sustainability Agenda, and to contribute to the United Nations’ Sustainable Development Goals (SDGs). Through a close exchange with our key stakeholders, we identified four SDGs where we create the greatest impact. 1. International Energy Agency, IPCC Sixth Assessment Report, McKinsey Charting the global energy landscape to 2050: Emissions 36 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ABB supports the Sustainable Development Goals ABB enables access to affordable and sustainable energy through our portfolio of electrification, automation and energy-efficient solutions. ABB contributes to decent work and economic growth by provid- ing safe and fair employment, paying taxes and supporting local communities. ABB’s innovative technologies actively contribute to sustainable industrialization and give us, our business partners and our cus- tomers the ability to move, work and live more sustainably. By reducing our own GHG emis- sions, empowering customers to avoid emissions and integrate re- newables, and working with sup- pliers and partners to reduce their carbon footprints, ABB is enabling decarbonization and climate action. Ensure access to affordable, reliable, sustainable and mod - ern energy for all. Promote sustained, inclusive and sus - tainable economic growth, full and productive employ - ment and decent work for all. Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation. Take urgent ac- tion to combat climate change and its impacts. SUSTAINABLE DEVELOPMENT GOALS While ABB contributes most to these four SDGs, we recognize the importance of the other SDGs and aspire to contribute to their achievement whenever and wherever possible. 37 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix You are here in the value creation model. Our business environment At ABB, we continuously monitor risks and op- portunities to identify key factors that could affect our business, growth, and strategy. Our broad industrial exposure across many sec- tors provides stability, allowing us to better weather market fluctuations. Risk management is embedded within our 19 divisions, which are closest to our customers and are thereby able to act with agility to emerging opportunities and risks. Through structured risk assessments and proactive reviews, we anticipate change, adapt quickly, and capitalize on new trends. This approach helps us mitigate potential threats and seize opportunities, ensuring resilience and driving sustainable growth. MEGATRENDS Megatrends are long-term shifts in demo- graphics, technology, the economy, and the environment; they redefine how people live and work. At ABB, we are positioned at the core of key megatrends such as the energy transition towards electricity as a key energy source, energy efficiency, decarbonization of heavy industries, demographic shifts in labor supply, geopolitical fragmentation, and digitalization and AI. These align directly with our purpose to drive sustainability and resource efficiency through our customer offerings in electrifica- tion and automation. By staying focused and executing effectively on our purpose, we are well positioned to capitalize on these trends and deliver long-term value to our stakeholders. The energy transition The demand for electricity is expected to more than double by 2050¹, driven by the electrifi- cation of transport, industry and buildings. Electrification will be essential for achieving net-zero emissions and is expected to contrib- ute over 50 percent of the required emissions reductions by enabling a shift from fossil fuels to renewable energy sources. Power generation, industry, transport, and buildings account for 95 percent 2 of global greenhouse gas emissions, and these four segments represent 98 percent³ of ABB’s revenues. Our technologies play a key role in supporting the energy transition, help- ing us contribute to progress and innovation in these essential sectors. 1. Investment in electrical infrastructure Today’s electricity grids face challenges in meeting growing energy demand while also enabling a transition to cleaner sources. The grid, originally designed for steady fossil fuel generation, requires upgrades in technology, energy storage and smarter management to handle the decentralized nature of renewable power generation. In the US, aging infrastructure struggles to keep up with the increasing integration of renewable energy, leading to grid reliability concerns and hence the need for modernization. Europe faces the challenge of balancing energy security with its ambitious decarbonization goals, requiring coordinated investments in grid resilience and cross-border energy networks. Meanwhile, China is focused on rapidly expanding its grid to support urbanization and industrial growth while transitioning from coal to cleaner energy sources. Similarly, India is focused on increasing grid capacity and securing access even across its most remote regions. Each region faces unique hurdles, but all are working to adapt their grids to support the energy transition and grid resilience. ABB’s technologies in electrification, automa- tion and digitalization enable a smarter, more flexible energy network. With approximately 13 percent 3 of our offerings directly tied to power generation, distribution and renewable energy, we are well positioned to support these investments and upgrades to the current infra- structure, delivering on our purpose to enable a more sustainable future. 2. Decarbonization of industries Industry accounts for approximately 25 percent² of global greenhouse gas (GHG) emissions. Today, policy changes, strong corporate com- mitments and market pressures are driving the decarbonization of industry. While over 10,000⁴ businesses worldwide have committed to the Science-Based Targets initiative (SBTi), pledg- ing to decarbonize their operations and value chains, carbon pricing mechanisms are also expected to increase the pressure on industries to accelerate their efforts. As of today, already more than 80⁵ jurisdictions have implemented carbon pricing mechanisms, including carbon taxes and emissions trading systems (ETS), 1. McKinsey & Company report: Global Energy Perspective 2024. 2. International Energy Agency. 3. Management estimate. 4. Science based targets: companies taking action. 5. World Bank State and Trends of Carbon Pricing Dashboard. 6. McKinsey report: Risk, resilience, and rebalancing in global value chains. 7. Management es- timate based on FY2023 revenues. 38 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 45% of the world's electricity is converted by industrial electric motors into motion We stand for productivity in a low-carbon world, so we innovate to contribute to energy efficient, decarbonizing and circular solutions for customers, industries and societies The combination of high efficiency motors and drives can help reduce total global electricity consumption by up to 10% $515 bn $343 bn +141% increase in avg. annual investments Low carbon energy Energy efficiency +53% increase in avg. annual investments $1,241 bn $526 bn 2016–2023 2024–2030 <25% of the world's electric motors are controlled by drives A drive can typically reduce power consumption by 25% ¹ Demand for electric motion to double by 2040 covering about 24 percent ⁵ of global emissions. As carbon prices continue to rise and carbon pricing mechanisms expand in scope to cover more sectors, industries are increasingly incen- tivized to reduce emissions and, hence, limit the impact of purchasing carbon permits on their operating costs. The transformation and decarbonization of heavy industry requires a multifaceted ap- proach that spans electrification, automation and digitalization: when replacing gas and diesel-powered turbines with electric motors, innovation enables a reduction in emissions but also enhances flexibility and efficiency. With more than half 3 of our customer offering linked to the electrification and automation of industry, this is where ABB excels. Our tech- nologies help optimize production processes, electrify industrial machinery and increase the energy efficiency of motor-driven applications, supporting our effort to help heavy industries transition to cleaner energy solutions using advanced technologies. 3. Energy efficiency With rising energy demand and stricter reg- ulations, such as minimum energy efficiency requirements for industrial motors sold in both the US and the EU, improving energy ef- ficiency is now a key driver for both economic and environmental progress. According to the International Energy Agency (IEA), energy effi- ciency measures could contribute around one third² of the emissions reductions needed by 2030, making efficiency gains an essential com- ponent of the global push to reach net zero. At ABB, we are not only committed to net zero ourselves, but also to helping our customers with roughly 35 percent 3 of our offering linked to energy efficiency and emissions reductions. Our energy-efficient solutions – such as vari- able speed drives, high-efficiency motors and energy management systems – are designed to optimize energy use, reduce waste and improve operational performance across industries. We enable customers to lower their energy consumption, reduce costs and shrink their carbon footprint. 1. Management estimate. 39 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Share of working age population (15–64) in selected countries/regions Unit labor cost index (LCU, 2010 = 100) in selected countries/regions Cost of manufacturing labor (2012–2021, indexed to 2012) 100 100 100 100 192 277 141 146 135 158 124 +14% +18% +3% +44% 140 50 52 54 56 58 60 62 64 66 68 70 72 74 2050 2040 2030 2020 2010 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0 2.1 2.2 2.3 2020 2018 2016 2014 2012 India China United States EU top 4 1 % 2010 2023 2030 China India Europe United States China United States Demographic shifts in labor supply and urbanization Demographic shifts are creating challenges for our customers across geographies. In many countries, populations are aging and hence their workforces are shrinking. Here, automation is becoming essential for continued economic growth and pushing companies to increasingly deploy automation, robotics and AI-driven soft- ware to maintain efficiency and productivity. At ABB we have leading technologies such as PLCs, our mechatronics platform including our expanded collaborative robots range, the OmniCore™ controller, and our broad autono- mous mobile robot (AMR) portfolio with unique AI embedded capabilities such as vision, which allows us to create automation solutions across segments, including newer fields such as health- care and construction. Urbanization and increased consumption put pressure on infrastructure and resources, re- quiring significant investments in areas like energy security, clean water, reliable transpor- tation, high-speed data and modern buildings. ABB’s solutions in Electrification, Motion and Process Automation are central to addressing these needs. Geopolitical fragmentation Regionalization and localization are emerging as significant global trends, putting supply chains and operational footprint reviews high on corporate agendas. 93 percent 6 of supply chain leaders are planning to increase resilience, with many considering shifting production closer to key markets. For companies to adapt, investing in advanced technologies like AI, au- tomation, and smart manufacturing is crucial. By embracing these innovations, businesses can reduce costs, enhance productivity and stay competitive in a more regionally oriented, global economy. For ABB, this means that as our cus- tomers are investing in a more resilient, flexible and smarter footprint, we are there to support them with our localized offering of products and solutions. At ABB, we have a strong tradition of lo- cal-for-local manufacturing, enabling us to stay close to our customers. Approximately 95 percent 7 of our products and solutions sold in Europe, 85 percent 7 of those in sold in China and 75 percent 7 of those sold in the United States are produced locally. Although a global company, we also take a local approach to our offering, localizing R&D and tailoring our 1. EU top 4 = Germany, France, Italy, Spain Source: UN Population Prospects 2024, S&P Global 40 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix You are here in the value creation model. product portfolio to the local market, where conditions allow. Digitalization and AI Digitalization and AI are transforming industrial manufacturing, logistics, building manage- ment, and many other sectors, by integrating data-driven tools directly into production processes. At ABB, we have digitally enabled approximately 60 percent of our products and services to enhance our ability to deliver greater efficiency and value to customers. For exam- ple, with the use of sensors and IoT devices we gather real-time data from machinery, produc- tion lines, and entire factories. This data then allows our customers to monitor operations, improve workflows, and address maintenance needs proactively. With AI, factories can au- tomate processes that once required manual oversight, like quality control, where AI systems analyze data to detect defects more accurately and quickly. AI also enables predictive maintenance, where algorithms detect patterns in equipment data to anticipate potential failures, preventing costly downtimes. Moreover, robotics pow- ered by AI now handle increasingly complex tasks, speeding up production and improving accuracy. This shift enables manufacturers to become more flexible and respond quickly to changes in demand. As digitalization and AI adoption is increas- ing across not only industry but all parts of our economy, demand in data centers is also rising and expected to grow at double-digit rates through 2030. This surge in demand is speeding up the move to more energy-effi- cient and scalable data centers to support the growing data needs for agile, data-driven operations across different sectors. Moreover, particularly AI-driven data centers require not only mission-critical power access but also significantly more power, further leading to an increased demand in medium-voltage solutions. As a leader in medium-voltage solutions, ABB offers a robust portfolio for the data center market, addressing customers’ challenges regarding growing power needs, direct grid ac- cess needs and mission-critical power access. OUR STAKEHOLDERS We aim to build trust and foster long-term re- sponsible business practices and relationships with our key stakeholders, including custom- ers, employees, governments and civil society including NGOs, the investment community, partnerships and suppliers. These stakeholders shape our business environment and influence the way ABB operates; they are also impacted by what we do and the value we create. Their voices provide a unique perspective on market trends, innovations and technologies and help us better understand how they shape different industries and geographies. Engaging with our key stake- holders therefore also plays an important role in defining ABB’s strategic direction and steering our business. The chapter “Engaging stakehold- ers” of the Sustainability Statement 2024 pro- vides further detail on our key stakeholders and how we engage with them. 41 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix You are here in the value creation model. Our inputs for value creation To deliver on our purpose and create long-term value for our stakeholders, ABB relies on financial, intellectual, natural, manufactured, human and social and relationship inputs. Both tangible and intangible inputs across these categories are used with care and considered fundamental to creating sustainable financial and non-financial value. ABB invests in value creation based on a strong understanding of our different stakeholders’ needs and intersecting interests. By balancing the use of our inputs and ensuring they are complementary, we are able to build on the full potential of our inputs and amplify both our financial outputs and our contributions to a sus- tainable society. Hiring and continuously invest- ing in our diverse workforce helps us innovate and develop new products and solutions for our customers. By reinforcing and continuously strengthening this technology leadership, we are able to deliver sustainable growth, reinvest- ing an increasing share of revenues into R&D, training and other targeted initiatives that help us sustain our competitive advantages, continu- ing our cycle of superior value creation. Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Financial input ABB’s financial inputs enable us to continuously invest in intellectual, natural, manufactured, human, and social and relationship inputs. By relentlessly focusing on delivering a strong op- erational performance and net working capital efficiency, we continuously improve cash flow delivery and, hence, are able to invest in growth. Our positive cash flow enables us to capitalize on key megatrends through our products and solutions, inorganic growth, partnerships, effi- cient operations and state-of-the-art facilities. Intellectual input Building on 140 years of engineering know-how, we invest an increasing share of revenues in both R&D and technology ventures to support the development of cutting-edge technology. Leveraging the collective knowledge of our em- ployees and their drive to innovate close to our customers gives ABB a competitive advantage that is not fully recognized on the balance sheet. This also includes the more than 250 projects running related to Artificial Intelligence (AI), covering innovations across our advanced soft- ware and digital offering. Our innovations and intellectual property are a key differentiator and enable us to create superior value for our cus- tomers by optimizing, electrifying and decar- bonizing their operations. Natural input Natural resources, energy and materials are crucial inputs to run our business and provide products and solutions to our customers. With sustainability and resource efficiency core to our purpose, we strive to produce and deliver our offering in the most resource efficient and sustainable way. This includes, for example, our continuous efforts to switch to renewable en- ergy sources and reduce our water withdrawal particularly in areas at water risk, including areas of high-water stress. We also reduce emissions across our own sites, a journey accel- erated through our Mission to Zero™ program launched in 2019. Across 21 sites currently part of the program, we use innovative and ambi- tious measures to help our sites achieve Mission to Zero™ status. An important focus also lies on our supply chain and purchase of materials, which contribute towards the environmental footprint of our products across their life cycle. Manufactured input Manufactured inputs include the tools, ma- chines, plants, infrastructure and buildings that we need to produce our products and provide our services. As of December 31, 2024, net property, plant and equipment amounted to $4,177 million, which was primarily invested in our approximately 170 manufacturing sites in over 40 countries. Our focus on “global reach with local presence” allows us to quickly scale innovations across our markets. Moreover, our long tradition of local-for-local manufacturing allows us to remain close to customers, exem- plified by approximately 95, 85 and 75 percent 1 of products and solutions sold in Europe, China and the United States, respectively, being pro- duced locally. We invest approximately $800 mil- lion annually in capital expenditure (CapEx) to ensure that our manufacturing capabilities can support our organic growth ambitions and se- cure our efficient production. Human input ABB’s 110,000 employees, representing 174 na- tionalities, are at the core of our value creation. Their health, wellbeing, intellectual engage- ment, motivation and ability to do their jobs well are essential to our ability to create value. Our people strategy empowers our employees to un- derstand and learn the skills needed to progress in their careers, to build a meaningful network they can lean on for feedback and guidance, and to take ownership of their growth and career. Social and relationship input ABB’s relationships with the communities we operate in and our stakeholders, including cus- tomers, civil society, NGOs, employees, govern- ments, investment community, partnerships, and suppliers, provide meaningful input in how we run ABB day to day. This means building on our large installed base and long-term relation- ships with end customers and channel partners to nurture a deep understanding of customer needs and ensure that we provide them with the greatest value possible. Moreover, we partner with universities and research institutions to drive innovation and develop advanced technol- ogies across disciplines such as materials sci- ence, software and power electronics. 1. Management esti- mate based on FY 2023 revenues. 43 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix You are here in the value creation model. ABB PURPOSE B U S I N E S S M O D E L P E O P L E & C U L T U R E G O V E R N A N C E B R A N D ABB Way In terms of value creation, the ABB Way guides us in transforming our inputs into outputs and outcomes and, hence, enables us to deliver superior value to our stakeholders. With our purpose at the core, the ABB Way defines “how” we work in a decentralized set-up to drive best-in-class performance. The ABB Way is our operating model and what ensures that the business is stronger as a group than as separate entities. Owned and controlled by ABB’s Executive Committee and mandatory for everyone across ABB, the ABB Way estab- lishes a consistent business model, places em- phasis on our people and ABB’s values, supports a strong culture of governance and integrity, and enables us to build and protect our brand and reputation. BUSINESS MODEL ABB’s business model guides us in how we work together in a decentralized set-up, drive best-in- class performance, allocate capital and manage our portfolio of 19 divisions. It ensures that all divisions not only follow the Group’s strategic direction and can contribute to achieving our financial and sustainability targets but also pur- sue opportunities to collaborate to best serve our customers. • Decentralized setup • Performance management • Capital allocation • Portfolio management • Positioning • Reputation • Values • People • Leadership • Code of Conduct • Internal control & compliance • Risk management • Policies and procedures THE ABB WAY 44 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 1–2% Acquired average growth through economic cycle ACQUISITION CRITERIA Strategic Fit with ABB’s purpose • Electrification & automation • Sustainability & resource-efficiency • Technology leadership Business attractiveness • Market growth and market profitability • Contribute to ABB’s ability to hold a leading market position • Financial performance of the target Decentralized set-up Our divisions are the highest operational level at ABB, empowered with full ownership and ac- countability for their strategies, performance and resources. This decentralized set-up en- ables us to make decisions close to our custom- ers and to operate with greater accountability, transparency and speed. Our divisions are organized into and governed by four business areas, while our lean corporate functions act as the key enabler for the Group, providing the frameworks for business, performance, portfo- lio management, capital allocation, people and culture, governance and brand. Performance management At ABB, we strive towards continuous improve- ment and, therefore, build on a systematic and transparent performance management frame- work, covering short-, medium- and long-term. We translate our strategic, financial and sustain- ability priorities into distinct targets, which are supported by appropriate incentives through our Annual Incentive Plan (AIP) and Long-Term Incentive Plan (LTIP). Core KPIs included in ABB’s financial target framework cover revenue growth, operational EBITA margin, Return on Capital Employed (ROCE), Free Cash Flow (FCF) conversion to net income and Earnings per Share (EPS) growth. Capital allocation ABB’s stringent capital allocation principles have enabled us to maintain a strong invest- ment grade rating. We focus on funding or- ganic growth (incl. R&D, CapEx) and paying a rising and sustainable dividend per share over time. Further, we continue to emphasize value-creating acquisitions to increase ABB’s exposure to megatrends, fill technology gaps, complement or expand our offering in high- growth segments, gain access to new geog- raphies, and boost economies of scale. Our ambition is to deliver an average 1–2 percent annual growth through M&A. Regardless of the acquisition size, the target must align with ABB’s purpose and we need to demonstrate that ABB is a better future owner who can enable superior value creation. Lastly, share buybacks continue to be part of our long-term capital allocation priorities. Portfolio management As part of our portfolio assessment framework, we review our divisions’ performance and stra- tegic mandates from a Group perspective. While performance is evaluated against both market and ABB’s financial and sustainability KPIs, our strategic mandates – stability, profitability or growth – reflect on a division’s performance and translate into strategic priorities, such as de- livering best-in-class performance and actively pursuing organic and inorganic growth oppor- tunities for divisions on a growth mandate. As our strategic mandates have proven a successful tool to deliver value for our stakeholders, we continue to apply them further down in the or- ganization, continuing to increase accountabil- ity, transparency and speed. 45 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix STRATEGIC MANDATES Stability • Restructure • Transform offering/ business model Profitability • Improve margin/return • Moderate investment in growth • Select technology add-on acquisitions Growth • Growth above market while keeping high/return level • 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 PEOPLE AND CULTURE Our people and culture are what make the dif- ference and are the foundation of ABB’s success. Building on ABB’s four values – Courage, Care, Curiosity and Collaboration – we maintain a safe, fair, equitable and inclusive working envi- ronment in which everyone can succeed and de- velop. By fostering a “high performance – high integrity” culture, our employees are encour- aged to drive performance by unleashing their full potential, always mindful of safety, internal controls, adherence to our Code of Conduct and our values. To continue to push the boundaries of technology and deliver on our purpose, we create opportunities for our people to focus on development and integrate learning into their work, encouraging them to gain new experi- ences and take the next step in their careers within ABB. GOVERNANCE ABB’s strong governance framework is designed to enable accountability, transparency, speed to execute and responsible risk management in our decentralized set-up in order to safeguard our business, people, assets and reputation from potential harm. It secures our license to operate through our internal controls, policies and pro- cedures including our Code of Conduct and is the basis to adopt technological developments such as artificial intelligence responsibly. The Code of Conduct serves as the foundation of our commitment to integrity, ethical behavior and human rights and guides us in embedding integrity throughout our entire value chain. BRAND The ABB brand is an expression of our company purpose, our values, and long history of innova- tion. Today, the iconic red ABB logo has become a sign of trust, quality and superior value for our customers, partners, investors and employees. By focusing on delivering on our purpose in everything we do, we continue to foster our rep- utation as a reliable business partner and tech- nology leader, and to be the preferred choice for our stakeholders. Helping industries outrun Industries are the beating heart of the modern world. They power us; protect us; move and connect us; make things for us. Today, how industries run is critical. From energy, power and mining to building, transport, manufac- turing, and more – they need to meet global demand, be more sustainable, efficient, and manage transitions. To them, “running” is no longer enough – they need to outperform. Or as we say at ABB, they need to “outrun”, leaner and cleaner. With our leading technologies in electrification and automation, we help industries run at high performance and become more productive, efficient, and sustainable, enabling them to outperform. At ABB, we call this ‘Engineered to Outrun.’ → See ABB’s Code of Conduct. 46 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix ABB’S ENTERPRISE RISK MANAGEMENT PROCESS 2 Identification & assessment of risks 3 Risk mitigation planning & implementation 4 Risk mitigation effectiveness monitoring 1 Identification of strategic business objectives Risks and opportunities The proactive and strategic management of risks is an integral part of how we do business. Our defined risk management framework enables us to identify and assess risks early and ensures that we have appropriate responses to manage and mitigate their effects across all levels of ABB. At the same time, we seek to turn the risks we face into potential opportunities and strive to manage both risks and opportunities in a responsible way. This approach supports the creation and pro- tection of value for ABB, our stakeholders and society. ENTERPRISE RISK MANAGEMENT The enterprise risk management (ERM) process is our holistic approach to identifying risks which could adversely impact the achievement of ABB’s strategic business objectives and lead to a material financial impact. The ERM process is embedded in our ABB Way operating model and encompasses all levels of our organiza- tion. It provides our leadership, including our Executive Committee and the Finance, Audit and Compliance Committee (FACC) of the Board of Directors, with a comprehensive overview of the most critical risks faced by our business. This intelligence informs our overall strategy and risk discussions and allows us to make well-informed decisions to safeguard value and take calculated risks to create value amidst a dy- namic societal and business landscape. The ERM process relies on the ongoing identifi- cation, assessment, mitigation and monitoring of the most critical risks affecting ABB. Our detailed methodology starts with the identifica- tion of our strategic business objectives. Then, we identify the most critical risks which could prevent us from achieving these objectives and lead to a potential material financial impact in the next five years. These risks are then assessed in terms of their potential impact, likelihood and speed of occur- rence. Specific responses to address these risks are then planned, implemented and continuously monitored to ensure they remain effective. We strive to turn risks into opportunities not only to minimize their downsides but to create value for ABB and our stakeholders, wherever possible. 47 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix TOP FIVE ENTERPRISE RISK CLUSTERS 2024 Top five risk clusters Examples of reported risks Examples of risk responses Cyber security incidents Potential cyber incidents involving ABB or third parties due to global increase in sophisticated cyber attacks, AI-powered threats, high interconnectivity across the supply 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 endpoint detection and response Geopolitical instability Increased geopolitical tensions globally resulting in trade re- strictions, protectionism, global technology decoupling, raw material price increases and asset damage. • Evaluation and monitoring of exposure to and depen- dency on higher risk geographical markets. • Developing alternative supply chains for raw materials and dual sourcing strategies for key components. Integrity behavior Potential breach of laws & regulations and ABB’s code of con- duct resulting in reputational and brand value damage, trade sanctions, regulatory fines and penalties, and economic loss. • Group-wide integrity training & awareness campaign and continuous improvement of internal control framework. • Integrity risk testing and consequence management implementation. Intensified competition Competitors’ targeted growth strategies, strengthened ca- pabilities, and competitive pricing, combined with increased traction from local market players and disruptive technolo- gies influencing the landscape. • 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. Legal and regulatory changes An ever-changing regulatory landscape across multiple com- plex topics leading to potential restrictions on trade and challenges in meeting compliance. • Proactive assessment of potential upcoming regula- tory changes and dedicated teams to manage complex compliance requirements. The ERM process at ABB categorizes risks as strategic, financial or operational: 1. Strategic: Strategic risks can relate to any of the fol- lowing: macroeconomic factors; market and technological developments; competitor and industry shifts; environmental, social and gov- ernance aspects; geopolitical developments; and/or portfolio management topics. These factors can have both negative and positive impacts on our business and create significant business opportunities. 2. Operational: Operational risks can relate to any of the fol- lowing: engineering, manufacturing, project management and productivity topics; health, safety and environment management; integ- rity and compliance aspects; supply chain management; cyber and information security threats; and/or 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: Financial risks can relate to any of the following: risks arising from ABB’s international financial activities; fluctuations in currency or interest rates; volatility in commodity prices; accounting and financial reporting requirements; financial planning, analysis and management aspects; and/or compliance with tax obligations. These factors are key to ensuring ABB has appropriate finance structures in place and that all financial compliance requirements enabling us to meet our capital needs are met. Below are the top five enterprise risk clusters facing ABB over the next five years as identified in the 2024 ERM process from across ABB. Our opportunities often arise in the same areas as our risks, showcasing how we not only work to mitigate risks, but also seek to create value for ABB and our stakeholders amid today’s global challenges. For example, risks associ- ated with the demographic shift of labor supply forces us to consider how we work smarter and more agile which in turn helps us innovate across process automation and robotics. Many of our offerings are also part of the solution to many of the world’s challenges today, meaning the upside is much bigger than the downside. ABB’s opportunities lie in strategic product in- novation that meets customer and societal de- mands, especially when supporting the world’s acceleration of the energy transition and the need to electrify. Our aim is to always be at the forefront when identifying new opportunities, considering the wider economic and societal megatrends that shape our environment. 48 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix SUSTAINABILITY RISKS AND OPPORTUNITIES In 2024, ABB performed a new Double Materiality Assessment (DMA), aligned with the Corporate Sustainability Reporting Directive (CSRD) and the European Sustainability Reporting Standards (ESRS). The result of the DMA pres- ents ABB’s material sustainability matters from an inside-out perspective (positive and/or negative impacts), as well as from an outside-in perspective (financially material risks and/or opportunities). We assess our impacts, risks and opportunities, including the responses to these, over the short-, medium- and long-term time horizons as well as across our full value chain. While our actual and potential impacts on people, planet and society are specifically addressed in the Outputs and Outcomes chap- ters in this report, these are also connected to effects on ABB. A negative impact on people for example can often turn into a risk for the com- pany, and a positive impact contribution may result in a business opportunity. ABB faces several risks and opportunities re- lated to its material sustainability matters. For example, climate change poses risks to our infrastructure, operations, and employee safety. But acting on climate change provides opportunities. Collaboration with governments and NGOs aids the transition to a low-carbon economy, while innovations in renewable energy and efficiency secure our market leadership, reputation, and talent attraction, alongside reducing carbon footprint and costs through diverse energy sourcing. When addressing busi- ness conduct risks and opportunities, ABB’s transparency and ethics build trust, combat corruption and limit financial risks. We perform rigorous audits and worker safety initiatives to manage the health and safety risks for workers in our value chain. Finally, ABB is also cognizant of risks pertaining to consumers and end-users, thereby ensuring that strong safety measures and clear usage instructions are present in our products. → For more informa- tion on our material impacts, risks and opportunities, includ- ing disclosures on climate-related risks and opportunities, see the ABB Sustainability Statement 2024. 49 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix 03 OUTPUTS AND OUTCOMES 51 Targets and performance overview 54 We deliver leading financial performance 65 We create value through world-class technology 74 We enable a low-carbon society 83 We preserve resources 89 We promote social progress 103 We embed a culture of integrity and transparency along the extended value chain 112 We help industries outrun – leaner and cleaner: case studies Targets and performance overview We have established a set of short-, mid- and long-term targets, supported by appropriate incentives, to manage our performance and achieve our strategic priorities. These targets encompass both financial performance and progress on sustainability. The table below shows the summary of our progress toward our targets. We deliver leading financial performance Targets 2024 Status Revenue growth 5–7% annual average through economic cycle, plus 1–2% inorganic 1 3% comparable Operational EBITA margin 16–19% 18.1% ROCE (return on capital employed) >18% 22.9% Free cash flow (FCF) conversion to net income ~100% 100% Basic EPS (earnings per share) growth at least high single digit % 6% We enable a low-carbon society Targets Baseline (year) 2 2024 Status Reduce own scope 1 and 2 CO 2 e emissions by at least 80% by 2030 and by 100% by 2050 631 kilotons CO 2 e (adjusted for portfolio changes) (2019) 138 kilotons CO 2 e Reduce scope 3 CO 2e emissions by 25% by 2030 and by 90% by 2050 3 429,854 kilotons CO 2 e (2022) 394,952 kilotons CO 2 e Ambition to avoid 600 megatons CO 2 e emis- sions throughout lifetime of products sold from 2022 to 2030 4 n.a. 204 megatons CO 2 e We preserve resources Targets Baseline (year) 2 2024 Status Cover at least 80% of ABB’s portfolio of products and solutions with our Circularity Approach by 2030 5 n.a. 41% (share of ABB’s products and solutions assessed) 6 Send zero waste to landfill while reducing waste generation by 2030 7 16.8 kilotons (2019), equivalent to 8.8% of total waste (adjusted for portfolio changes) 9.3 kilotons, equivalent to 5.8% of total waste We promote social progress Targets Baseline (year) 2 2024 Status Zero harm to our people and contractors – we aim for a gradual reduction in lost time from incidents (LTIFR) 0.24 (2019) 8 0.15 Increase proportion of women in senior management roles 9 to 25% by 2030 11.7% (2019) 21.3% Achieve a top-tier employee engagement score 71/100 (2019) 78/100 Expand programs for community engagement n.a. In 2024, we released an internal guideline to formalize the company’s community engagement strategy and provide direction on developing projects aligned with ABB’s Sustainability Agen- da & ABB’s Four Focus Areas (4Es) of intervention. 1. Calculated to exclude FX impacts and transformational acquisitions and divestments, includes bolt-on acquisitions and divestments within divisions. 2. Where baseline applies. 3. Strict scenario: Energy input used as the basis for calculations; for further details and explanation see our Sustainability Statement 2024. In 2023, we published a “representative scenario” and a “strict scenario”. Going forward, we report the strict scenario as basis for our scope 3 emissions, taking a more conservative ap- proach based on fully energy input for certain products. 4. This ambition is not part of the committed targets. Avoided emissions 2024 status is cumulative for 2022-2024. 5. Based on revenues from hardware-based products and solutions, where granularity of financial systems allows. Service revenues are excluded. 6. The circularity score of the assessed products and solutions is to be calculated once a representative share of the portfolio has been assessed. 7. Waste from demolition and construction excluded from landfill; not including hazardous waste. 8. Baseline 2019 excludes the divested Power Grids business and Turbocharging division. 9. At ABB, senior managers are defined as employees in Hay grades 1–7. 51 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We embed a culture of integrity and transparency along the extended value chain Targets 2030 Baseline (year) 1 2024 Status Global framework for assessing and mitigating third-party integrity risks through risk-based due diligence and life cycle monitoring. This target measures the implementation of a global framework for assessing third-party integrity risks. It is an ongoing and critical organization-wide, integrity-based enhance- ment, which strengthens how we onboard and manage the life cycle of our relationships with suppliers, sales channels and customers. Framework established and operational. Integrity due diligence and risk management enhancements for suppliers (buy-side) and sales channels (sell-side) launched globally. Framework enhanced and implementation tested. Comprehensive monitoring and risk mitigation guidance developed. Focused on the governance of this framework to sustain its operation and risk management of legacy third-party relationships, both in terms of suppliers and sales channels. Development of business specific plans to monitor and mitigate third-party risks, with fo- cus on resourcing for sustaining operation. Global Integrity Program underpinned by ac- countability for integrity and an adaptive risk management strategy gained from insights through targeted learnings, transparent re- porting and monitoring. This target measures the implementation and effectiveness of our Global Integrity Program through how we drive individual accountability for integrity and adapt our risk management strategy to real-time data insights gained from integrity-based learnings, reporting and monitoring. 1. Trust KPI – the rate of severity level 1 and 2 investigations where the reporter disclosed their identity: • Year 1 (January 1, 2021, to December 31, 2021): 57% of reporters; • Year 1 and 2 (January 1, 2021, to December 31, 2022): 60% of reporters; • Year 1, 2 and 3 (January 1, 2021, to December 31, 2023): 60% of reporters. 2. Engagement KPI – the volume of unique visitors to the Integrity Awareness Portal for integrity learnings: • Year 1 (January 1, 2021, to December 31, 2021): 25% of employees with online access; • Year 1 and 2 (January 1, 2021, to December 31, 2022): 69% of employees with online access; • Year 1, 2 and 3 (January 1, 2021, to December 31, 2023): 80% of employees with online access. 1. Trust KPI – the rate of severity level 1 and 2 investigations where the reporter disclosed their identity, as a measure of trust in the re- porting system and integrity program: • Year 1, 2, 3 and 4 (January 1, 2021 to December 31, 2024): 55% of reporters. 2. Engagement KPI – the volume of unique vis- itors on the Integrity Awareness Portal for integrity learnings: • Year 1, 2, 3 and 4 (January 1, 2021 to December 31, 2024): 82% of employees with online access. At least 80% of supply spending in focus countries 2 covered by Sustainable Supply Base Management (SSBM) by 2030 Using a risk-based approach, a mid-term 2025 target has been set, focusing on high-risk suppli - ers in focus countries. 2 At least 80% of spending on high-risk suppliers in focus countries 2 covered by SSBM by 2025 68% of supply spending on high-risk suppliers in focus countries covered by SSBM Linking sustainability targets to executives’ variable pay Under the Annual Incentive Plan (AIP), a safety goal was included within the individual mea- sure for some members of ABB’s Executive Committee. The individual measure had a total weighting of 20% of the executive’s target AIP award (2019). Under the AIP, in 2024, at least two sustainabil - ity-related performance goals were included within the individual measure for each member of ABB’s Executive Committee. The individual measure had a total weighting of 20% of the executive’s target AIP award. The Long-Term Incentive Plan (LTIP) had two performance measures with an equal weight- ing of 50% each, namely average earnings per share and relative total shareholder return. The LTIP was awarded to executives, including Executive Committee members and division presidents. Vesting under the LTIP was subject to the achievement of the plan specific targets over a period of three years (2019). The LTIP is granted to approximately 100 executives, including Executive Committee members and division presidents. One of the three performance measures under the 2024 LTIP is based on achievement of a corporate sustainability target which carries a weighting of 20% of the executive’s target LTIP award. Vesting under the LTIP is subject to the achievement of the plan specific targets over a period of three years. 1. Where baseline applies. 2. Current focus countries are Brazil, Bulgaria, China, Egypt, India, Malaysia, Mexico, Saudi Arabia, South Africa, Thailand, Tunisia and Türkiye. 52 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes 53 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We deliver leading financial performance In 2024, we made progress on virtually all headline numbers of our income statement driven by benefits from our decentralized ABB Way operating model and an overall supportive market environ- ment. Our operating assets yield high returns, and our continued investments enable us to maintain a market leading position with world-class technology in electrification and automation – creating value for all our stakeholders. You are here in the value creation model. 54 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes After a period of transformation, all our busi- nesses are now aligned with our purpose and are well-positioned at the center of key trends, such as electricity becoming the primary energy source and the increasing need for automation and digitalization to remain able to produce. We support our customers with high-quality, low-carbon solutions and energy efficient offer- ings, while also helping manufacturing compa- nies automate for greater resource efficiency. This year we saw strong growth in our electrifi- cation offerings, driven by rapidly increasing de- mand for electricity, which is expected to grow nine times faster than other energy sources between 2024 and 2030. This strength more than offset weakness in discrete automation. Although the fundamental long-term market drivers remain intact in this business segment, customer activity this year was tempered mainly by normalized ordering patterns after a period of pre-buys. The ABB Way operating model is firmly estab- lished within our organization, supported by the fact that our new CEO, Morten Wierod, and two new Business area presidents, Giampiero Frisio and Brandon Spencer, are internal hires with proven track records of successfully man- aging within this framework. From this strong level we see opportunities to deepen the impact of the ABB Way by extending it further into the business lines. Our goal is to make the ABB Way second nature across all teams, incentivizing management with clear strategic mandates, as well as increasing accountability, transpar- ency and speed of operations. By applying this framework at a more granular level, each divi- sion can tailor strategies to its specific needs, ensuring consistent and focused performance organization wide. Active portfolio management remains a key part of our performance culture and is inte- grated into the responsibilities of divisional management teams. While we are committed to acquisitions as a growth driver, it is not yet fully ingrained in our ways of working and this will continue to be a focus area going forward. This includes identifying areas for inorganic growth through acquisitions related to new segments, new market access, better economies of scale or filling technology gaps. The divisions also assess, based on systematic portfolio reviews, whether, ultimately, their division is the best owner of their different businesses. In 2024, we accelerated this activity with bolt-on acquisitions and strategic partnerships led by our divisions, completing seven acquisitions and nine new venture capital investments, as well as eight follow-on investments, moving us closer to our target range of 1 to 2 percent of revenue growth through acquisitions. The Service Division in the Electrification Business area acquired the SEAM Group, which adds en- ergy asset management and advisory services to clients across industrial and commercial building markets while the Process Automation business area completed three acquisitions, the largest being the acquisition of Födisch Group, in the Measurement & Analytics Division. The Motion business area also completed the integration of two previously announced ac- quisitions and announced the acquisition of the power electronics business of Gamesa Electric in Spain from Siemens Gamesa which will strengthen ABB’s position in the growing market for high-powered renewable power conversion technology. Electrification also an- nounced another sizeable acquisition. We have agreed to acquire the Wiring & Accessories business of Siemens in China, led by our Smart Buildings division, which will expand our market reach and enhance our regional customer offer- ings with a full range of safe and reliable smart building technologies. 55 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Orders and revenues Orders In 2024, total orders remained stable versus last year’s high level (increasing 1 percent compara- ble 1 ). With electricity increasingly becoming the key power source, the Electrification business area saw strong order growth across most end markets, with particularly high demand from data centers and utilities, as well as growth in the buildings segment driven by commercial buildings, mainly in the United States. Orders in the Motion business area decreased 3 percent (2 percent comparable 1 ) with customers looking to make operations more energy efficient by investing in high standards of electrical motors and drives, but at the same time held back by an overall muted industrial demand. Strong performance in the power generation segment was offset by declines in heavy, process-related industries such as chemical, oil & gas, met- als and pulp & paper and cement and mining. Orders in the Process Automation business area also decreased compared to the prior year, when momentum for large orders was partic- ularly strong. That said, the underlying market activity level remained robust with customers looking for ABB to support them in their journey towards decarbonization of heavy industries. This year, the customer activity was strongest in marine & ports, although overall orders declined due to the timing of large projects in the prior year. Strength was also noted in the low carbon segments and conventional power generation. Orders in the Robotics & Discrete Automation business area declined sharply. In the Machine Automation division orders declined as indus- trial automation demand slowed, coupled with machine builders adjusting orders after high- er-than-usual pre-ordering during past supply chain disruptions. The robotics segment de- clined, driven mainly by fewer investments in the automotive sector and consumer electronics, while positive momentum was reported in logis- tics and general industry. In 2024, orders decreased 3 percent in the Americas (1 percent comparable 1 ), driven mainly by the recording of two large orders in the U.S. totaling $435 million in 2023. Despite this impact, underlying demand in 2024 remained strong in the United States, while orders de- creased in Canada and Mexico, but increased in Brazil. In Europe, orders were flat (flat compara- ble 1 ). Orders were higher in Germany, Sweden, Finland and the Netherlands while they declined in Italy, Norway and the United Kingdom. In Asia, Middle East and Africa, orders increased 2 per- cent (5 percent comparable 1 ). Orders declined in China but were more than offset by strong order growth in markets such as Australia, Japan and the United Arab Emirates. Revenues In 2024, revenues increased by 2 percent (3 per- cent comparable 1 ), primarily driven by volume growth, with additional support from positive price. Strong conversion of our order back- log into revenue supported growth, driven by the Process Automation and Electrification Business areas, with the latter also positively impacted by increased short-cycle demand. Revenue was broadly stable in the Motion Business area with positive impacts from pric- ing offset by negative volumes driven mainly by declines in the short-cycle businesses. In the Robotics & Discrete Automation Business area, as well as the E-mobility Division, revenues de- clined sharply as underlying markets remained weak, consistent with the slowdown in orders. In 2024, revenues increased 6 percent in the Americas (8 percent comparable 1 ), where revenues in the United States increased 8 per- cent (9 percent comparable 1 ). Revenues in the Americas also experienced strong growth in Canada and Chile. In Europe, revenues declined 4 percent (4 percent comparable 1 ). Revenues were higher in Switzerland, Norway, Spain and the United Kingdom while they declined in Germany, Italy and Sweden. In Asia, Middle East and Africa, revenues increased 4 percent (7 per- cent comparable 1 ) compared to 2023. Revenues grew in India, Saudi Arabia, Australia, and Singapore, partially offset by a decline in China of 4 percent (2 percent comparable 1 ). → For additional informa- tion and analysis about individual business area revenues and order per- formance, refer to the relevant sections of the business analysis in our Financial Report 2024. 1. For alternative perfor- mance measures see chapter Alternative per- formance measures 56 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes GROWTH FY 2024 FY 2024 Change year-on-year Orders Revenues Comparable 1% 3% FX -1% -1% Portfolio changes 0% 0% Total 0% 2% ORDERS BY REGION Change ($ in millions, unless otherwise indicated) FY 2024 FY 2023 US$ Comparable 1 Europe 11,454 11,458 0% 0% The Americas 12,110 12,437 -3% -1% Asia, Middle East and Africa 10,126 9,923 2% 5% ABB Group 33,690 33,818 0% 1% REVENUES BY REGION Change ($ in millions, unless otherwise indicated) FY 2024 FY 2023 US$ Comparable 1 Europe 11,119 11,568 -4% -4% The Americas 11,805 11,090 6% 8% Asia, Middle East and Africa 9,926 9,577 4% 7% ABB Group 32,850 32,235 2% 3% 20,000 25,000 30,000 35,000 20,000 25,000 30,000 35,000 ORDERS REVENUES Orders Comparable growth % % $ in millions -10 0 10 20 2024 2023 2022 2021 2020 Revenues Comparable growth % % $ in millions -10 0 10 20 2024 2023 2022 2021 2020 57 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Earnings Gross profit Gross profit increased by 9 percent (10 percent in constant currency 1 ) to $ 12,274 million in 2024, resulting in a gross margin improvement of 260 basis points to 37.4 percent. Gross profit improved in three out of four business areas, with Electrification and Process Automation re- porting double-digit growth driven by both vol- ume and price. Motion improved at a mid-single digit rate driven by structural improvements in the long-cycle businesses offsetting lower vol- umes in the short-cycle. The Robotics & Discrete Automation business area declined driven by lower volumes as backlogs normalized and a weak underlying market. Income from operations Income from operations in 2024 amounted to $5,071 million, representing an increase of 4 per- cent from $4,871 million in the prior year. The improvement was primarily driven by stronger operational performance, as well as additional support from lower restructuring and related expenses which more than offset the adverse impact from portfolio changes, as the current year’s results were impacted by a charge of ap- proximately $90 million due to the E-mobility business reducing its ownership in a subsidiary to a minority stake. In contrast, 2023 results were supported by gains of $101 million from the sale of businesses, including the divestment of the Power Conversion business. We also re- corded higher losses for fair value changes in various equity investments compared to gains in 2023. Operational EBITA In 2024, Operational EBITA increased by 10 percent (11 percent in constant currency) to $5,968 million and the Operational EBITA margin 2 was up by 120 basis points to 18.1 per- cent. The expansion was driven by operating leverage on higher volumes and additional impacts from implemented price increases as well as lower underlying corporate costs. Combined these impacts more than offset some higher expenses related to Selling, General & Administrative expenses and Research & Development. Operational EBITA in Corporate and Other amounted to -$424 million, of which -$273 million related to the E-mobility business which was negatively impacted by inventory related impairments as well as technology investments geared towards a more focused product strategy to secure a continued market leading position. Net finance expenses and non-operational pension credits In 2024, interest and finance expenses dropped significantly, while interest and dividend income increased, resulting in a net finance income of $107 million, representing an improvement of $217 million compared to the prior year. The year-on-year improvement is mainly driven by a combination of a lower net debt position and favorable mix of interest rates between borrow- ings and cash deposits as well as lower foreign exchange losses. Non-operational pension credits increased by $38 million to $55 million compared to the same period last year, mainly driven by lower curtail- ment and settlement costs and lower interest costs on the benefit obligation. Income tax In 2024, the effective tax rate increased to 24.4 percent from 19.5 percent in 2023. In 2024, the increase in the effective tax rate was primarily driven by the geographical mix of earnings, resulting in a negative impact of ap- proximately 2 percentage points. The effective tax rate was also positively impacted by favor- able reassessments of uncertain tax provisions of approximately 3 percentage points, while in 2023 the respective benefit was approximately 4 percentage points. Net income and earnings per share Net income attributable to ABB was $3,935 mil- lion and increased by 5 percent. Basic earnings per share was $2.13 and increased by 6 percent. The increase was driven by improved opera- tional performance offsetting higher adverse impacts from non-operational items than in 2023 as discussed above. 1. Constant currency (not adjusted for portfolio changes). 2. For non-GAAP measures see chap- ter Alternative performance measures. 58 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes 5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,000 13,000 0.00 1.00 2.00 3.00 2024 2023 2022 2021 2020 0 2,000 4,000 6,000 GROSS PROFIT AND GROSS MARGIN BASIC EPS INCOME FROM OPERATIONS AND OPERATIONAL EBITA Gross profit Gross margin % Basic EPS % $ in millions 25 27 29 31 33 35 37 39 2024 2023 2022 2021 2020 $ per share Operational EBITA Income from operations Operational EBITA margin % % $ in millions 5 10 15 20 2024 2023 2022 2021 2020 59 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Balance Sheet Net working capital Net working capital amounted to $2,830 million, decreasing year-on-year from $3,257 million driven by the favorable impact from changes in exchange rates combined with an increase in trade payables and higher customer advances, more than offsetting the increase in receivables. Net working capital as a percentage of reve- nues 1 decreased from 10.2 percent at the end of 2023 to 8.6 percent at the end of 2024. Capital expenditures Purchases of property, plant and equipment and intangible assets amounted to $845 million in 2024 compared with $770 million in the same period last year. Cash flows In 2024, cash flows from operating activities generated net cash of $4,675 million, up from $4,290 million in 2023. Three out of four busi- ness areas reported improved cash flows from operations, driven by stronger earnings and a reduction in net working capital compared to the prior year. Free cash flow 1 increased by $270 million to $3,937 million, with an FCF con- version to net income 1 of 100 percent. Return on Capital Employed The Group’s benchmark for the measurement of returns is Return on Capital Employed (ROCE) 1 which increased by 180 basis points from 21.1 percent to 22.9 percent in 2024. The main driver of the improvement was higher Operational EBITA compared with 2023. Net debt During 2024, although we continued to return cash to shareholders in the form of dividends and purchases of treasury stock, we reduced our net debt (as presented in the table below) driven by continued strong cash from operat- ing activities. During 2024, our net debt de- creased $706 million to a net debt position of $1,285 million at December 31, 2024. The effect of exchange rate movements decreased net debt by approximately $200 million. In 2024, we generated free cash flows of $ 3,937 million and sold treasury stock in relation to our em- ployee share plans for $451 million. These items were partly offset by amounts for purchases of treasury shares of $1,247 million, including $1 billion relating to the announced buybacks of our shares, as well as $1,769 million for the pay- ment of the dividend to our shareholders. We made payments related to acquisitions totaling $622 million. ($ in millions, unless otherwise indicated) December 31 2024 2023 Short-term debt and current maturities of long-term debt 293 2,607 Long-term debt 6,652 5,221 Total debt 6,945 7,828 Cash & equivalents 4,311 3,891 Restricted cash – current 15 18 Marketable securities and short-term investments 1,334 1,928 Cash and marketable securities 5,660 5,837 Net debt (cash) 1,285 1,991 1. For non-GAAP measures see chap- ter Alternative perfor- mance measures 60 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes 0 1,000 2,000 3,000 0 1,000 2,000 3,000 4,000 8 10 12 14 16 18 20 22 24 2024 2023 2022 2021 2020 Return on Capital employed ROCE Impact of PG JV ownership interest Target range >18% 0.0 0.4 0.8 1.2 2024 2023 2022 2021 2020 $ in millions FREE CASH FLOW AND CONVERSION RATE NET DEBT RETURN ON CAPITAL EMPLOYED (ROCE) Free cash flow % of net income Net debt Net debt/EBITDA ratio % $ in millions 0 100 200 300 2024 2023 2022 2021 2020 % 61 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes PROCESS AUTOMATION Performance of business areas KEY FIGURES ($ in millions, unless otherwise indicated) FY 2024 FY 2023 Change US$ Comparable Orders 16,422 15,189 8% 10% Order backlog 7,506 6,808 10% 15% Revenues 15,448 14,584 6% 9% Operational EBITA 3,520 2,937 20% as % of operational revenues 22.7% 20.1% +2.6 pts Cash flow from operating activities 3,652 3,211 14% No. of employees (FTE equiv.) 51,700 50,300 3% ELECTRIFICATION KEY FIGURES ($ in millions, unless otherwise indicated) FY 2024 FY 2023 Change US$ Comparable Orders 7,106 7,535 -6% -5% Order backlog 7,437 7,519 -1% 4% Revenues 6,756 6,270 8% 9% Operational EBITA 1,025 909 13% as % of operational revenues 15.1% 14.5% +0.6 pts Cash flow from operating activities 1,158 1,002 16% No. of employees (FTE equiv.) 22,500 21,100 6% 0 2,000 4,000 Orders Revenues Operational EBITA Income from operations Operational EBITA margin % ORDERS AND REVENUES $ in millions $ in millions INCOME FROM OPERATIONS AND OPERATIONAL EBITA % 10,000 13,000 16,000 2024 2023 2022 2021 2020 10 15 20 25 2024 2023 2022 2021 2020 Orders Revenues Operational EBITA Income from operations Operational EBITA margin % ORDERS AND REVENUES $ in millions $ in millions INCOME FROM OPERATIONS AND OPERATIONAL EBITA % 5,000 6,000 7,000 2024 2023 2022 2021 2020 0 500 1,000 1,500 2024 2023 2022 2021 2020 5 10 15 62 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ROBOTICS & DISCRETE AUTOMATION MOTION KEY FIGURES ($ in millions, unless otherwise indicated) FY 2024 FY 2023 Change US$ Comparable Orders 7,989 8,222 -3% -2% Order backlog 5,239 5,343 -2% 4% Revenues 7,787 7,814 0% 0% Operational EBITA 1,518 1,475 3% as % of operational revenues 19.4% 18.9% +0.5 pts Cash flow from operating activities 1,776 1,532 16% No. of employees (FTE equiv.) 22,400 22,300 1% KEY FIGURES ($ in millions, unless otherwise indicated) FY 2024 FY 2023 Change US$ Comparable Orders 2,596 3,066 -15% -15% Order backlog 1,447 2,141 -32% -29% Revenues 3,213 3,640 -12% -11% Operational EBITA 329 536 -39% as % of operational revenues 10.2% 14.7% -4.5 pts Cash flow from operating activities 315 436 -28% No. of employees (FTE equiv.) 10,800 11,300 -4% 0 2000 4000 2024 2023 2022 2021 2020 Orders Revenues Operational EBITA Income from operations Operational EBITA margin % ORDERS AND REVENUES $ in millions $ in millions INCOME FROM OPERATIONS AND OPERATIONAL EBITA % 6,000 7,000 8,000 2024 2023 2022 2021 2020 12 16 20 -300 0 300 600 2024 2023 2022 2021 2020 Orders Revenues Operational EBITA Income from operations Operational EBITA margin % ORDERS AND REVENUES $ in millions $ in millions INCOME FROM OPERATIONS AND OPERATIONAL EBITA % 1,500 2,500 3,500 4,500 2024 2023 2022 2021 2020 0 5 10 15 63 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes OUTLOOK Looking to 2025, we will continue to deliver on our strategy of driving the ABB Way operating model further into our divisions, whereby generating additional long- term accountability, transparency and speed. Our strong balance sheet supports acquisitions, and we are gaining some momentum in this area. Based on the deals we have already announced but not yet completed, we should approach our long-term target range for acquired growth. In addition, we intend to continue with share buybacks in line with our capital allocation principles. We acknowledge some market uncertainty and what currently seems to be an adverse impact on reported numbers from changes in exchange rates mainly due to the appreciation of the USD. That said, in full-year 2025, we expect a positive book-to-bill, compa- rable revenue growth in the mid-single digit range and the Operational EBITA margin to improve year-on-year. 64 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We create value through world-class technology Our significant R&D investments and highly skilled workforce enable us to continuously evolve our offering to remain a relevant and trusted partner for our customers. Technology and innovation are key to our long-term success. We are committed to staying ahead by developing world-class technologies that transform industries to reach new levels of performance and sustainability. ~2,000 secondary patents filed in 2024 >$1.4 billion R&D investment in 2024 ~7,800 R&D employees ~22k Granted patents 9 venture investments in 2024 ~$50 million venture investments in 2024 ~6k Pending patent applications >750 priority patents filed in 2024 4.5% revenues invested in R&D in 2024 HIGHLIGHTS You are here in the value creation model. 65 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Our approach to R&D At ABB, our R&D is driven by our 19 divisions and focuses on developing and commercializing technologies that are strategically important for our future growth. As of December 31, 2024, we had approximately 7,800 employees work- ing in R&D centers across ~30 countries on six continents, with over half dedicated to digital and software development. Women represent 13.9 percent of our R&D workforce. We invest a significant portion of our annual revenues in R&D. In line with our commitment to sustained innovation, we have increased our R&D spending by approximately 40 per- cent since 2020, and have set an ambition to increase our R&D as a percentage of revenues to between 4.5% to 5%. In 2024, we invested $1,469 million, or approximately 4.5 percent of our consolidated revenues, in R&D activities, marking a 12 percent increase year-on-year. Additionally, we invest each year in order-re- lated development activities – customer- and project-specific efforts to develop or adapt equipment and systems to meet unique cus- tomer requirements. R&D spend by division in our business areas ranges from 1 to 10 percent of revenues, as each division is different and has different investment needs to maintain market leadership. This strategic allocation ensures that resources are used effectively to support growth and innovation. We seek to maintain a balance between short- and long-term R&D pro- grams and optimize our return on investment. We keep control of our innovations by hold- ing patents, copyrights and other intellectual property protections. To complement our business-focused product development, our businesses invest jointly in collaborative research activities covering multiple technology areas including artificial intelligence (AI), software, sensors, control and optimization, mechatronics and robotics, power electronics, communication technologies, ma- terials and manufacturing, electrodynamics and electrical switching technologies. In this way, we advance technologies that are used in our prod- ucts and common technology platforms and apply them to multiple product lines. 800 1,000 1,200 1,400 1,600 R&D AND VENTURE CAPITAL INVESTMENTS 3.0 3.5 4.0 4.5 5.0 2024 2023 2022 2021 2020 2019 2018 % $ in millions Venture capital investments Non-order related R&D, (excl. Divested divisions) R&D & Venture investments as % of Revenues R&D as % of Revenues 66 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Investments in digital solutions and artificial intelligence In line with our decentralized ABB Way oper- ating model, ABB’s digital strategy is both customer-driven and business-led. Today, a significant proportion of our product portfo- lio contains embedded software, increasingly enhanced by AI. We call this digitally and AI- enabled technologies. This offering is comple- mented by advanced software applications that can be applied in almost any industrial setting. Our main digital platform is ABB Ability™, which is also the brand name of our digital solutions offerings. Our advanced software applications comprise scalable software solu- tions, developed primarily through organic growth initiatives, and complemented with venture investments and bolt-on acquisitions. This offering centers on six key value pillars: sustainability, operational excellence, process performance management, asset performance management, cyber security, and extended automation software updates. Some of our flag- ship advanced software applications include: • ABB Ability Genix • ABB Ability™ Digital Powertrain • ABB Ability™ Energy Manager • RobotStudio® Delivering “value through software” we make our core electrification and automation of- ferings more secure and more connected. Leveraging ABB’s global footprint and extensive installed base, we gain deep industry insights that enable us to develop software, and digital solutions close to the automation layer and product level to help our customers optimize energy production and use, optimize assets and processes and optimize how people work. This year, ABB introduced ABB Ability™ Genix Copilot, a generative AI solution developed in collaboration with Microsoft to drive efficiency, productivity, and sustainability in industrial op- erations. Powered by Azure OpenAI Service and leveraging GPT-4, Genix Copilot integrates re- al-time operational data with natural language capabilities to deliver actionable insights. By embedding these features into its digital solu- tions, ABB enables industries to optimize asset performance, reduce emissions, and enhance energy efficiency. Early use cases demonstrate its impact in predictive maintenance, trou- bleshooting, and sustainability management, underscoring ABB’s commitment to innovation and value creation. Other AI-focused offerings include ABB Ability™ Efficiency AI, a smart buildings solution that uses AI to optimize heating, ventilation and air conditioning (HVAC); and ABB Ability Digital Powertrain, which uses AI to detect anomalies in motors. 67 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Strategic partnerships, business ventures, and M&A Universities are incubators of future technology, and our R&D teams collaborate with multiple universities and research institutions to build research networks and foster new technologies which we potentially invest in and sometimes acquire. We believe these collaborations put us in a good position to add new technology to our existing portfolio. Our university collaborations include long-term, strategic relationships with leading institutions in various countries around the world facilitating recruitment and training of new talent. To enhance our innovation efforts and gain speed, our divisions partner with other leading companies which have complementary compe- tencies, and we invest in and collaborate with startups around the world through our venture capital arm, ABB Technology Ventures, and our start-up collaboration hub, SynerLeap. We act as a catalyst to push innovative entrepreneurs to success and bring benefits to ABB customers and society in the wider sense. In 2024, we made 9 new venture investments, and 8 follow on investments for a total invest- ment of approximately $50 million across our four business areas. The investments were driven by the divisions and focused primarily on digital capabilities including AI that will create synergies with our offering of digitally enabled products and services. We invested in two clean technology start-ups – Ndustrial and GridBeyond – offering AI powered solutions for real time optimized energy consumption for accelerated decarbonization as well as op- timized distributed energy resources and in- dustrial loads. In addition, we made a follow-on investment to strengthen our partnership with Pratexo to co-develop edge computing solu- tions to improve security, autonomy and resil- ience for decentralized electrical networks. M&A is another way that we sustain and enhance our technology leadership. We have increased the number and size of bolt-on acquisitions to bolster our portfolio. A key example is our acquisition of Födisch Group, which enhances our capabilities in continuous emission mon- itoring with advanced gas and dust measure- ment solutions. This strategic move supports precise emission tracking strengthening our global leadership in continuous emission mon- itoring. Another example is our acquisition of the shipping business of DTN Europe BV and DTN Philippines Inc., which expands our marine software offerings to include vessel weather routing, analytics, reporting, and shore-based support. This strategic move positions us as a market leader in ship route optimization, en- abling us to provide comprehensive digital solu- tions that enhance operational efficiency and support maritime decarbonization efforts. 68 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Patents Intellectual property rights are crucial to pro- tect the assets of our business. Over the past ten years, we have added a substantial number of new applications to our existing first pat- ent filings and we will continue to seek patent protection for our technologies, products and solutions. As of December 31, 2024, we have a portfolio of approximately 28,000 pending patent applications and granted patents, of which approximately 6,000 are pending appli- cations. This portfolio includes approximately 3,600 utility models and design rights, of which approximately 160 are pending applications. In 2024, we filed over 750 priority patents, utility model and design applications, each covering a unique invention or unique angle on an inven- tion. Additionally, we filed approximately 2,000 secondary patents, utility model and design applications, each extending the coverage of a previously filed priority application. Based on our existing intellectual property strategy, we believe that we have adequate control over our core technologies. The “ABB” trademarks and logo are protected in all of the countries in which we operate. We proactively assert our intellectual property rights to safe- guard the reputation associated with ABB’s technology and brand. While these intellectual property rights are fundamental to all of our businesses, there is no dependency of the business on any single patent, utility model or design application. 69 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Innovations Innovation is at the core of ABB’s purpose to enable a more sus- tainable and resource-efficient future. This year, we advanced technologies that enhance reliability and efficiency, helping indus- tries navigate change while aligning with our long-term vision for smarter, more sustainable operations. ABB pioneers advanced cable protection solu- tion crafted from discarded ocean fishing nets ABB is innovating solutions for increasing the life span of cables used across energy, transpor- tation, automation, and chemical processing industries, where protection is needed against mechanical stress, chemicals, moisture, and UV exposure. ABB’s PMA EcoGuard™ is a more sus- tainable cable protection solution made from recycled fishing nets. The recycled material has led to approximately 30 percent savings in CO 2 e emissions and 50 percent reduction in use of net fresh water. EcoGuard cable protection stands out for its high performance and durability, ensuring long- term protection while minimizing the need for frequent replacements and reducing waste. The system’s ease of installation and resistance to wear contribute to its efficiency and sus- tainability, making it a cost-effective solution over time. With innovations like the EcoGuard solution, ABB continues to minimize the need for frequent replacements, thereby preserving resources and reducing waste. ABB achieves a world-first with liquid-cooled IE5 SynRM motor that sets the benchmark for energy efficiency and high power output ABB has achieved a world-first with its liquid- cooled IE5 SynRM (Synchronous Reluctance Motor), setting a new benchmark for energy ef- ficiency and high power output. This innovative motor offers superior performance while re- ducing energy consumption, making it ideal for high-demand industrial applications like pumps, fans and compressors. The liquid cooling system significantly enhances the motor’s efficiency by dissipating heat more effectively than traditional air-cooling methods. This allows the IE5 SynRM to operate at an IE5 efficiency level, the highest standard for in- dustrial motors, while providing greater power density and reducing overall energy usage. As a result, the motor lowers operational costs and helps companies meet sustainability goals by reducing their carbon footprint. 70 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes The IE5 SynRM also features advanced materials and design, ensuring optimal performance in demanding environments. It supports smooth integration into existing industrial systems, offering a more sustainable solution with- out requiring major infrastructure changes. This technology is a significant leap toward energy-efficient automation and helps indus- tries reduce their environmental impact while maintaining high levels of productivity. ABB’s liquid-cooled IE5 SynRM is a game-chang- ing development in the field of energy-efficient motors, demonstrating the company’s leader- ship in sustainable technologies. This innova- tion not only delivers high power output but also sets a new standard for the future of indus- trial electrification, contributing to the global push for decarbonization. ABB is first to reach anticipated IE6 hyper-effi- ciency with magnet-free motors – IE6 ABB has become the first company to achieve the anticipated IE6 hyper-efficiency standard with its magnet-free motors, marking a signifi- cant milestone in energy efficiency and sustain- ability. These motors surpass the IE5 efficiency class and are designed to deliver greater perfor- mance while reducing energy consumption and carbon emissions. The IE6 motors are built without the use of rare- earth magnets, which makes them both cost- effective and more sustainable, as they rely on more readily available materials. This innovation is especially important in industries that rely heavily on electric motors, as it helps to reduce operational costs and contributes to lower car- bon footprints in applications like pumps, fans, and compressors. In addition to their superior efficiency, ABB’s magnet-free motors are designed for easy integration into existing industrial systems, ensuring businesses can transition to more sustainable technologies without major infra- structure changes. The motors provide excellent performance in demanding applications while supporting global energy transition goals. This achievement represents ABB’s ongoing commitment to sustainable innovation and sets a new standard for energy-efficient solutions. With the IE6 motors, ABB is advancing the global push for decarbonization while helping indus- tries achieve lower energy costs and reduce their environmental impact. This milestone further solidifies ABB’s leadership in electrification tech- nologies and sustainable industrial solutions. European Space Agency’s Harmony mission to rely on ABB infrared instruments German space and technology company OHB System AG is working with ABB on developing and building the thermal infrared payloads for the European Space Agency’s (ESA) Earth Explorer Harmony satellites, planned to launch in 2029. ABB will equip the two satellites with multispectral thermal infrared payloads capable of measuring a wide range of environmental parameters, including sea surface temperature and the position of clouds and their motion. ABB’s technology will enable ESA to measure cloud position and motion from space, ensur- ing radiometric precision – the accuracy of the temperature measurement obtained by the in- frared instruments compared to that of the true surface temperature (whether cloud or sea). The data collected by the mission will help the advancement of climate science as well as sup- port the understanding and forecasting of ex- treme weather such as hurricanes. In addition, over land, Harmony will provide information to estimate small shifts in the shape of the land surface, such as those leading to and resulting from earthquakes and volcanic activity. The combination of thermal and radar imagery will help provide a wide array of data, giving more insight into upper-ocean heat exchanges, drivers of extreme weather, and the long-term impact of climate change. The mission will also provide new information for a better under- standing of how ice being lost from glaciers is affecting sea level rise. 71 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes OmniCore ABB has launched its next-generation robot- ics control platform, OmniCore™, designed to improve automation and enhance productivity across industries. OmniCore offers advanced performance, flexibility, and connectivity fea- tures, enabling precise control and integration of robotic systems for a variety of applications, from manufacturing to logistics. Key features of OmniCore include its ability to handle complex tasks with high precision, support for multiple robot types, and intuitive user interfaces. The platform is built for scal- ability, allowing businesses to easily expand and adapt their robotic systems as needs evolve. OmniCore’s connectivity features enable re- al-time data exchange, supporting predictive maintenance and seamless integration with other automation technologies, improving effi- ciency and reducing downtime. OmniCore also supports sustainability goals by optimizing energy use and reducing resource consumption during production processes. The platform is designed to boost the flexibility of automation systems, enabling faster adaptation to new tasks and changing production require- ments. It provides companies with the tools to optimize their robotic systems and stay com- petitive in an increasingly automated world. SF 6 -free switchgear ABB has introduced the next generation of SF 6 -free switchgear solutions, using dry air or natural origin gas technology for up to 24 kV, which will be commercially available in 2025. Gas Insulated Switchgear (GIS) is used in space-con- strained urban areas, coastal regions, high alti- tude and polluted, harsh environments thanks to its compact and robust design. Traditionally, GIS used sulfur hexafluoride (SF 6 ) as the insu- lating medium due to its excellent electrical insulating properties and high electronegativity. However, due to its potency as a greenhouse gas and EU legislation banning the use of fluo- ride gases, companies are transitioning away from SF 6 . ABB has developed SF 6 -free products that use the same user interface, footprint, proven components and operation as its exist- ing SF 6 portfolio. Electrification Distribution Solutions partners with businesses to navigate these regulatory changes with our next-gener- ation SF 6 -free switchgear and support utilities and industries on their decarbonization and en- ergy transition journey. 72 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB creates world’s first medium voltage, speed-controlled motor concept, facilitating industry’s contribution to a low carbon world ABB has developed the world’s first medi- um-voltage speed-controlled motor concept – MV Titanium, designed to help industries reduce their carbon footprint and contribute to a low-carbon world. This innovative motor com- bines ABB’s advanced variable speed drive tech- nology with a medium-voltage motor, enabling precise control over motor speed and energy efficiency. It offers industries significant im- provements in energy savings and operational performance, particularly in high-demand sec- tors like pumps, fans, and compressors. By adjusting motor speed to match real-time requirements, the new concept minimizes energy waste and optimizes power consump- tion, significantly reducing CO 2 emissions. It also reduces the obstacles and costs related to installing a separate motor and drive pack- age, including the associated electrical house (e-house), transformers, switchgear and cabling that multiplies the capital cost and increases the complexity of installation, especially on ex- isting sites where space is at a premium. This innovation also helps companies meet sus- tainability goals while improving the efficiency and reliability of their operations. ABB’s medi- um-voltage speed-controlled motor is a key step in the company’s efforts to promote decarbon- ization and drive the transition to more sustain- able industrial processes. With this groundbreaking technology, ABB continues to lead in the development of eco- friendly solutions that support industries in reducing their environmental impact while maintaining high performance and productivity. OUTLOOK We will continue to focus on technology leadership and further invest in our R&D capabilities, patents and trademarks. We plan to maintain our R&D spend in the range of 4.5–5.0 percent of revenues. One of our planned actions for 2025 includes the sixth ABB Electrification Start-up Challenge which will run until April 2025. Other business areas will also announce further start-up challenges in the coming months. 73 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We enable a low- carbon society Enabling a low-carbon society is at the center of our purpose and value proposition and a key pillar of our Sustainability Agenda. ABB contin- ued its efforts and achievements in helping customers reduce and avoid emissions through our products, solutions and services. At the same time we have made progress in reducing emissions in our own operations and across our value chain. HIGHLIGHTS • Validation of ABB’s scope 1, 2, and 3 net-zero science-based targets for 2050 by the Science Based Targets initiative (SBTi). This includes near- term targets for 2030. • Achieved a GHG emissions reduction of 78% compared to 2019 baseline for scope 1 and 2 • Made progress on Climate Group initiatives RE100, EV100 and EP100 • Introduced scope 3 targets into long-term performance planning • Engaged with key customers and suppliers to exchange Product Carbon Footprint (PCF) data and reduce emissions • Increased number of third-party verified Environmental Product Declarations (EPDs) You are here in the value creation model. 74 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB’s management and targets ABB’s value chain, from raw material ex- traction to end-of-life, impacts climate change. Manufacturing, assembly and logistics from our own operations contribute directly to greenhouse gas (GHG) emissions. We mitigate this through energy-efficient processes, use of renewable energy, sustainable upstream practices and supplier engagement. Our big- gest GHG emissions footprint lies in our value chain through indirect emissions, scope 3. Particularly, the use of products sold is the larg- est contributor to our emissions, covering about 96 percent of our total emissions, followed by emissions from purchased goods and services, while our scope 1 and 2 emissions account for less than 1 percent of total emissions. At the same time, our technologies enhance custom- ers’ energy efficiency, leading to emissions re- ductions, and are at the core of accelerating the energy transition. ABB’s central value proposi- tion to our customers is providing products and services that optimize, electrify and decarbon- ize while making how we move, produce, work and live more sustainable overall. We enable the fundamental transformation of many industries. Our efforts to enable a low-carbon society focus on three areas: • reducing GHG emissions in our own operations; • collaborating with our suppliers to reduce their emissions; and • supporting our customers to reduce and avoid emissions through the use of our products, solutions and services. Under ABB’s Sustainability Agenda, we sub- mitted updated targets to the Science Based Targets initiative (SBTi) for scope 1, 2, and 3 for 2030 and 2050. These targets were validated by the SBTi for both our operations and our up- stream and downstream value chain emissions. In line with the SBTi Net-Zero Standard, we have committed ourselves to having net-zero emis- sions across all scopes by 2050. To underpin the importance of these areas for ABB and incentivize performance, GHG emis- sions reduction targets including scope 3, particularly the ones related to purchased goods and services and use of our prod- ucts sold, have been integrated in long-term performance planning. ABB is committed to leading the way in reduc- ing impacts related to climate change, with a strategic focus on reducing scope 1 and 2 GHG emissions by at least 80 percent by 2030, versus a 2019 baseline, and scope 3 GHG emis- sions by 25 percent, versus a 2022 baseline. The cornerstone of this ambitious goal is assessing key decarbonization levers, particularly those which pertain to the use of sold products. Grid decarbonization is the biggest lever to reduce ABB’s emissions across the value chain. By de- veloping and introducing ultra-efficient electric motors and drives, ABB is not only enhancing energy efficiency for its customers but also significantly lowering the emissions associ- ated with the lifecycle of its products. These products also have the potential to support avoiding emissions altogether as they lead to a reduced volume of GHG emissions as compared to alternative solutions. ABB has updated its risks and opportunities analysis linked to climate change. This provides ABB with a comprehensive understanding of the climate challenges facing the industries it supports, as well as requirements linked to the adaptation to physical risks expected to impact its own value chain. By enabling a low-carbon society through its product and service offering ABB is well positioned to adapt to the context of climate change and also realize business opportunities. → More information on our climate-related risk and opportunity man- agement can be found in our Sustainability Statement 2024. 75 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Reduce absolute scope 1 & 2 emissions 80% by 2030 versus a 2019 baseline Reduce absolute scope 3 emissions 25% by 2030 from a 2022 baseline ABB’S SBTI APPROVED TARGETS Near term targets Long term targets Reduce scope 1 & 2 emissions 100% by 2050 versus a 2019 baseline Reduce absolute scope 3 emissions 90% by 2050 versus a 2022 baseline Reach net-zero greenhouse gas emissions across the value chain by 2050 76 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB’s operational emissions ABB’s divisions are reducing emissions in their own operations, as measured by our scope 1 and 2 emissions. In doing so, ABB is not only contributing to a more sustainable future but also mitigating climate risks to our business and delivering cost savings. As part of our drive to make ABB a net-zero company, we have also committed to three ini- tiatives of The Climate Group, a global initiative of which ABB is a member. ABB has committed to source 100 percent of its electricity from renewable energy sources (RE100 initiative) by 2030, electrify its vehicle fleet, amounting to more than 10,000 cars (EV100 initiative) and im- prove energy efficiency and productivity across its operations (EP100 initiative). These actions will help to further reduce its scope 1 and 2 GHG emissions. In 2024, we made good prog- ress towards our target of scope 1 and 2 emis- sions reduction by reducing these emissions by 9 percent from 2023, reaching an overall 78 per- cent reduction versus the 2019 baseline. Our progress is as follows: • RE100: In 2024, we sourced 95 percent of electricity from renewable energy sources. Progress was mainly driven by a consolidation of our renewable energy procurement, as well as progress of our sites investing into onsite renewable energy generation as part of our Mission to Zero™ program. • EV100: In 2024, 38 percent of our vehicle fleet was electric, with 216 ABB sites offer- ing EV charging stations. Our main focus in this regard in 2024 has been an update to our EV procedure, ensuring full coverage for our effort, and installing e-charging stations at sites that were not yet equipped to ease the transition for our employees further. • EP100: We are targeting a 20 percent increase in energy productivity measured as energy consumption in relation to economic output as compared to 2019. In 2024, we reached a 69 percent improvement in energy produc- tivity compared to 2019. This is mainly due to continuous improvements in operational energy efficiency which have led to decreases in total energy consumption every year from 2019, while revenue has continued to increase. from 53% in 2021 to 81% in 2022 to 94% in 2023 to 95% in 2024 Percent of our electricity from renewables SHARE OF RENEWABLE ELECTRICITY 77 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Our divisions are accountable for GHG emis- sions reductions in their operations. They are collaborating on best practice sharing in a com- munity of practice supported by updated proce- dures on renewable energy and electric vehicles. They are continuously working to decarbonize our operations, investing in heat pumps, install- ing on-site photovoltaic, and exploring power purchase agreements (PPAs) for clean energy. Furthermore, and partly using our own ABB technology, our sites have implemented energy efficiency measures, installing energy-efficient lighting, upgrading our heating, ventilation, and cooling (HVAC) systems, and implementing building automation systems in our operations. Overall, we have reduced our energy consump- tion by 22 percent compared to 2019 and will continue to invest in measures to reduce energy consumption further, while moving towards a higher share of renewable energy and electric- ity. These efforts are reducing emissions and cost at the same time. TOTAL ENERGY USED AND TOTAL SCOPE 1 & 2 GHG EMISSIONS kilotons CO 2 e GWh Total energy used (GWh) Total scope 1 and 2 GHG emissions (kilotons CO 2 e) 0 500 1,000 1,500 2,000 0 200 400 600 800 2024 2023 2022 2021 2020 78 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB’s value chain emissions Our ambition for a low-carbon society extends to our customers and suppliers. We conduct Life Cycle Assessments (LCAs) to identify opportuni- ties for emissions reductions in the value chain and achieve our targets. Information gained through LCAs is used for our third-party verified Environmental Product Declarations (EPDs). These are standardized documents validated by industry experts to declare quantitative infor- mation of a product’s environmental impacts and enables the comparison of footprints of products on the market. They are accessible via our EcoSolutions QR code which is featured on an increasing number of our products. ABB is part of the Partnership for Carbon Transparency (PACT), an initiative by the World Business Council for Sustainable Development (WBCSD). We are piloting the exchange of Product Carbon Footprints (PCFs) via PACT-conform platforms. Combining this information with a compre- hensive GHG inventory covering all scope 3 categories enables us to get a clear view of the emission hot spots in our value chain. The vast majority of our indirect GHG emis- sions relate to the use of products sold to our customers. In 2024, our scope 3 emissions decreased by 8 percent compared to our base year 2022 to 395 MtCO 2 e, based on a strict scenario where we use energy input as the basis for calculations. This is in line with our net-zero target validation by SBTi. The vast majority of our products utilize electricity as the energy input. Electricity is the easiest energy source to decarbonize and hence we have utilized the projections published by the International Energy Agency (IEA) of grid decarbonization as one of the key parameters for ABB’s net-zero targets. At the same time, we are working to gather primary data to demonstrate that our customers use more renewable energy than average regional emissions factors suggest. By collaborating with suppliers and customers, we aim to replace secondary data with primary data, exploring more targeted interventions and encouraging joint Power Purchase Agreement investments through ABB’s collaborative ef- forts. An example of our proactive efforts to reduce these emissions is continually improving the energy efficiency of our products thereby supporting our customers to reduce their operational emissions and ABB to reduce its scope 3 emissions. A major positive impact that ABB is able to de- liver with its technology leadership is the avoid- ance of emissions when using ABB products as compared to alternative products. 79 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Supplier emissions Our divisions work closely with suppliers to reduce emissions profiles of products in order to meet the expectations of the markets, which are becoming more and more environmentally conscious. One key action is to improve the transparency of product-related emissions by providing more granular EPDs to our customers which require ABB to obtain PCFs from its sup- pliers and to include them into LCAs and prod- uct circularity assessments. In our supply chain, we pay close attention to using lower-carbon transport options, low- er-carbon materials with renewable or recycled content and innovative materials that weigh less but provide comparable quality performance. Collaborating closely with suppliers to identify potential supply chain emissions reductions and incentivizing investments that are secur- ing the supply of these materials today and in the future are key focus areas. ABB has also joined the Center for Decarbonization Demand Acceleration (CDDA), curated by the WBCSD, to join industry efforts to increase availability of these materials and solutions. Initiatives to source materials closer to manufacturing locations are another way to reduce emissions in the supply chain and are encouraged under the EU’s Carbon Border Adjustment Mechanism (CBAM) with other jurisdictions expected to follow. Tracking of PCF plus transport emissions on a per shipment basis provides ABB with the required insights to make informed and timely decisions on how to adjust its supply base and transport lanes. As part of our ambitions to reduce our scope 3 emissions, we continue to work with our suppli- ers to enable them to reduce emissions in their own operations and in their upstream supply chain. The emissions captured in our reporting on purchased goods and services (scope 3, category 1 as per the Greenhouse Gas Protocol) reflect the footprint of the full supply chain, up to the origins of raw materials. This is why we seek to engage not only with our Tier 1 suppli- ers, but also with Tier 2 suppliers and beyond. Since 2023, we have provided information and training sessions to our suppliers and collected information via our supply chain emissions re- duction program. This has provided us with an understanding of the maturity of our suppliers and their suppliers and of where to prioritize our engagement to reach our target. We are re- questing our key suppliers to use the EcoVadis platform to report their overall emissions, and to indicate their emission reduction plans and progress against targets. In 2024, we completed a mapping of ABB’s emissions from 100 percent of supplier cate- gories, identifying greenhouse gas emissions hot spots. The top 10 material groups account for over half of the emissions from purchased goods and services. These hot spots were the focus of our engagement with suppliers, as we seek to understand more about the key mate- rials that are responsible for the emissions of these suppliers and how ABB can collaborate with these suppliers to drive decarbonization. Customer emissions ABB products and solutions support the power, industry, transport, and buildings sectors in optimizing, electrifying, and decarbonizing. We have three means through which we contribute to the energy transition: • increased efficiency through automation, high efficiency motors and drives, and industrial software; • substituting fossil-fuel combustion for pro- cesses and propulsion by electrification; and • detection and avoidance of leakages of GHGs like methane and other harmful substances. At ABB, by far the largest contribution we can make to a low-carbon society is in our custom- ers’ operations, as the largest proportion of our overall value chain GHG emissions sits in our scope 3 downstream emissions from the use of sold products. Our sold products require significant amounts of energy and, depending on the local energy mix of a country, this may lead to significant GHG emissions. In order to reduce the absolute emissions of our products sold, we use several levers, constantly pushing innovation to bring energy consumption further down. Through our comprehensive offerings, we are speeding up the decarbonization of grid systems, promoting innovation to integrate re- newables into the energy mix. We look for ways to reduce the energy demand of our offerings by improving the energy efficiency of our products and providing customers with solutions that are designed to enable them to electrify their op- erations. Efficient electric motors for example are used in many cases to replace fossil-based solutions. In addition, we provide our customers with information about the power consumed and emissions avoided by our offerings. Given the current megatrend of digitalization and artificial intelligence, which comes with a sig- nificantly increased energy need in data centers, ABB plays an important role in providing en- ergy efficient mission-critical power solutions. To help our customers reduce emissions, we provide end-to-end support, which includes 80 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes 1. Source: International Energy Agency. 2. Management estimate based on FY 2024 revenues. 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 ABB services offerings (examples) Global GHG Emissions by segment¹ Electrification – the world going electric Energy security Emission reduction, Energy efficiency Automation 13% Utilities Renewables integration Generators Synchronous condensers Hydrogen Power 40% Energy-related GHG emissions 54% Industry High-efficiency motors and variable speed drives Electrification of heavy-duty trucks Optimization and factory automation Emissions monitoring and leak detection Industry 25% Energy-related GHG emissions 13% Transport & Infrastructure Marine hybrid & electric propulsion systems EV onboard equipment & charging E-buses & fleets charging & propulsion Rail traction electric Transport 22% Energy-related GHG emissions 18% Buildings Building energy management Power Distribution HVAC control Lighting and comfort control Buildings 8% Energy-related GHG emissions % of ABB Revenues by sector² 81 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes product-related training and sharing of expe- riences and best practices. We listen carefully to customer feedback and adapt our strategies and operations to best serve their needs. Avoided emissions We continue to track and quantify our custom- ers’ avoided emissions in line with the guidance provided by the WBCSD. Avoided emissions describe the volume of GHG emissions our customers can avoid by using ABB products compared to other available solutions and cover the full product lifecycle. Our energy-ef- ficient motors and drives and automation and control systems help to reduce and avoid emis- sions in industries, buildings, infrastructure and transport. In 2024, ABB’s acquisitions highlighted areas where ABB continues to bring its expertise in electrification and optimization. For example, the acquisition of Födisch Group, a leading developer of advanced measurement and analytical solutions for the energy and indus- trial sectors, underscores ABB’s commitment to providing advanced continuous emission monitoring systems that have become vital for companies to monitor and mitigate emissions and comply with environmental regulations. The acquisition of DTN Shipping expands our offering in maritime software and ship route optimization which supports enhanced voyage efficiency, saving fuel and cutting emissions. In 2024, the products we sold to customers this year helped them avoid 66 megatons of emissions and 204 megatons cumulatively since 2022, considering the full lifecycle of the prod- ucts. This fits our ambition to support custom- ers in avoiding 600 megatons of GHG emissions from 2022 to 2030, based on all the products we expect to sell over that period. OUTLOOK We will continue to focus on reducing GHG emissions directly and indirectly across our value chain. Building on our hot spot analysis, we are: • Working with our suppliers to leverage opportunities for emissions reductions in the full supply chain beyond Tier 1 suppliers. • Focusing on reducing the GHG footprint of our sold products by looking at the design of the products themselves and increasing the circularity of our products. • Accelerating grid decarbonization through our products and service offerings. AVOIDED EMISSIONS Ambition to enable our customers to avoid 600 megatons of CO 2 e emissions throughout lifetime of products sold from 2022 to 2030 82 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We preserve resources We collaborate with our stakeholders to safeguard natural resources in our value chain by embedding circularity principles in our opera- tions and products, increasing recycling and reusability rates, and reducing waste and water use in areas at water risk. We are commit- ted to preserving biodiversity and to using land responsibly. HIGHLIGHTS • Zero-waste-to-landfill and circularity targets included in ABB’s long-term planning process (LPP) with all divisions contributing to reaching the targets by 2030 • We decreased the percentage of waste sent to landfill to 5.8 percent • We are expanding our water stewardship based on the Alliance for Water Stewardship (AWS) standard You are here in the value creation model. 83 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB’s management and targets Preserving resources is a key pillar of ABB’s Sustainability Agenda and a core element of our value creation model. ABB’s focus on preserv- ing resources encompasses several sub-areas including resource use, circularity, and resource flows. Impacts, risks, and opportunities were identified in these areas as part of ABB’s 2024 double materiality analysis. Our Circularity Approach encompasses our company-wide efforts to address the impacts, risks and opportunities related to resource use. Beginning with the design stage, we are com- mitted to increasing the resource efficiency of our solutions and to making them more durable by means of our lifecycle management services and lifetime extension and moderniza- tion services, thus supporting principles of a circular economy. We are working closely with customers, sup- pliers and partners to embed circularity throughout our entire value chain. By assessing the impact of our offerings throughout their complete life cycle, our product managers and relevant functions identify ways to improve cir- cularity across our product portfolio. This pro- cess encourages cooperation and partnerships with key stakeholders across industries and sectors on a wide range of activities – from en- gaging with suppliers to source materials with a smaller environmental footprint or reduced raw material content, to recovering scrap from pro- duction and looping it back to our operations. We also create circular value by collaborating with curated recycling partners to enable take- back schemes in many markets. Within our own operations, we aim to avoid waste by making our processes more efficient, by increasing the use of sustainable materials in our products and packaging, and by expanding recycling activities at our sites. The avoidance of land degradation including deforestation and soil sealing, water pollution and scarcity, and protecting biodiversity are relevant to our stakeholders’ recognition of ABB as a company striving for sustainability. 84 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Circularity The circular economy’s goal is to preserve re- sources. At ABB, we see circularity as an oppor- tunity to forge new partnerships and business models. We are focusing on taking meaningful action and collaborating with stakeholders and partners to safeguard natural resources in our value chain. Designing our products following circularity principles optimizes and extends the life phase of customers’ solutions integrating ABB products. Our solutions are designed to last, to be material and energy efficient when in operation, and designed to be reused, repaired and recycled. We also support our customers in their journey to more resource-efficient op- erations through our holistic service offering: digital solutions to extend the lives of the assets through remote operations and corrective as well as predictive maintenance; modernization services to extend lifetime, optimize perfor- mance and reduce waste; and take-back ser- vices, to facilitate responsible end-of-life. Our Circularity Approach includes a clear set of KPIs which correspond to each stage of the product lifecycle: from design and sourcing to product manufacturing, to optimized use phase (energy efficiency when in operation and service offerings) and responsible end-of-life. ABB plans to share the circularity score of assessed products and solutions once a representative share of the portfolio has been assessed. By the end of 2024, 41 percent of our product portfolio had been assessed against the guidelines of the Circularity Approach. The illustration below reflects ABB’s Circularity Approach across the different stages of the product lifecycle. ABB’s Circularity Approach is managed by a dedicated Circularity Working Group, which coordinates initiatives relating to circularity among our four business areas, clarifies and updates the approach, defines how we mea- sure progress by means of the circularity KPIs, establishes the guidelines by which the KPIs are assessed and shares best practices. The working group has also contributed in 2024 to the development of the World Business Council for Sustainable Development (WBCSD) Global Circularity Protocol (GCP), which is expected to be published at COP30 in November 2025 and will inform the evolution of ABB’s Circularity Approach. This contribution is aligned with our commitment to advancing the circularity agenda beyond our organization. ABB'S CIRCULARITY APPROACH What we enable circular customer solutions What we do ABB circular operations ABB Circular Business Model Circular design & sourcing Design Sourcing Manufacturing Logistics & packaging Efficiency Lifetime Take-back Recycling Resource- efficient operations Optimized use phase Responsible end-of-life 85 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Water and waste Using natural resources in a responsible way is a priority for ABB. In 2024, we conducted our annual assessment of water stress using the World Resources Institute’s (WRI) global wa- ter risk tool. It showed a decreased number of ABB’s locations (91) facing an enhanced level of water stress. Our water consumption in areas at water risk, including high water stress areas, decreased by 2.3 percent compared to 2023 to 283,123 m³. For sites in extremely water stressed areas, ABB continuously evaluates what mea- sures are being taken, considers the possibil- ities to introduce new measures and explores opportunities for local collaborations based on the requirements set out by the Alliance for Water Stewardship (AWS). AWS provides a com- prehensive global framework for sustainable water management, focusing on responsible water use, quality and governance at the water- shed level through multi-stakeholder engage- ment. While these actions are ongoing, ABB India is planning to certify one of ABB’s sites in Bangalore according to AWS requirements. Building on this, we plan to scale certification to other sites globally. While water risks are relevant for our own operations, the biggest exposure lies in our supply chain. If our suppliers face flooding or water scarcity, this will impact ABB negatively. Therefore, we seek to have flexibility in our supply chain, while increasingly monitoring the risk exposure of our main suppliers. Suppliers are asked to demonstrate systems for moni- toring water usage, with the expectation that initiatives are taken to improve water usage ef- ficiency and seek collaborations with local com- panies or universities on innovative programs. We also help our customers to reduce water extraction and freshwater pollution through our wide range of water and wastewater solu- tions. The ABB Water Care program improves our clients’ processes related to water and waste water. It ensures optimal and reliable plant performance, extends the operating life of automation and electrical assets, and protects equipment and intellectual investments. The use of energy-efficient motors, drives, and monitor- ing solutions is reducing risks and costs for the water sector. Another important aspect is our zero-waste-to- landfill commitment. We have waste reduction programs at our sites throughout the world. The zero-waste-to-landfill target is now included in ABB’s Long-term Planning Process, meaning all divisions have made plans and identified in- terim milestones to achieve this target in 2030. In 2024, we increased the amount of waste that ABB generates by 6.3 percent to 177.5 kilotons compared to the previous year due to extraordi- nary effects from demolition and construction projects. 82 percent of our waste was recycled, and 5.8 percent of waste from operations sent to landfill. This marked a decrease of 0.5 per- centage points for waste sent to landfill, com- pared to the previous year. 86 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Pollution prevention and substances of concern To ensure the safe use of materials and to re- duce and, where possible, eliminate the use of hazardous materials from our operations, we rely on the ABB List of Prohibited and Restricted Substances. This list applies to every aspect of our operations, including procurement, product development, production processes, products, packaging materials, service activities and con- struction sites. We update the list twice a year in keeping with local and international regula- tions and legislation. ABB’s four business areas have full ownership of their respective product material compliance obligations, which include the European Union’s requirements for chem- icals and products listed in the Substances of Concern in Products (SCIP) database. We have developed a companion guide to the list to help ABB’s suppliers meet their obligations, which includes partnering with us to identify and pre- vent restricted substances from entering ABB’s supply chain. In addition, ABB’s Global Terms and Conditions for suppliers and our Supplier Code of Conduct address prohibited and restricted substances. In 2024, all business areas continued to col- lect material compliance information. Our Electrification business area, for example, collected compliance declarations for more than 214,000 articles acquired from their supplier base. This information is securely stored in dedicated databases and is used for customer communications and product compliance statements. We have also introduced programs to identify the use of per- and polyfluoroalkyl substances (PFAS) to report them to authorities and cus- tomers, when required. In addition, we sup- port programs to phase out PFAS substances via the ABB List of Prohibited and Restricted Substances and specific programs in the EU and US. This is a crucial program for all ABB divi- sions. To avoid pollution in ABB’s value chain and operations, we promote sustainable practices, such as supplier environmental criteria and cir- cular economy principles. → See ABB’s Supplier Code of Conduct. 87 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Biodiversity ABB monitors the potential negative impact of its business activities on biodiversity, for ex- ample through pollution of air, water and soil. ABB uses a solidly implemented environmental management system to ensure any risks ABB’s own operations pose on the environment are being addressed and eliminated. With proper biodiversity and land-use management, ABB can contribute towards protecting flora and fauna and implementing legacy-site remediation projects. In 2024, we conducted a comprehen- sive assessment to identify and analyze ABB sites located in or near biodiversity-sensitive or protected areas. It showed that out of 449 ABB sites assessed, 83 sites were located within one kilometer from a protected area of high biodi- versity value, while four are located in protected areas. Many of our sites within this scope are certified according to ISO 14001 Environmental Management Systems and ISO 9001 Quality Management Systems, which provide the basis for our assessment, supplemented by additional external data sources. Furthermore, our manufacturing sites op- erate in line with valid permits. Our EU sites are already subject to relevant EU regulatory requirements relating to flora, fauna, and hab- itats, whereas the non-EU sites underwent a case-by-case evaluation, which considered rele- vant national legislation related to the conserva- tion of habitats and species, as well as external environmental assessments. Given the rising importance of biodiversity and its interconnected relevance, also in con- junction with the discussion around climate change, we will be establishing a structured ap- proach towards managing these topics, guided by the recently published Recommendations of the Taskforce on Nature-related Financial Disclosures. Our efforts moving forward will need to increasingly involve our supply chain as well as our customer operations. We aim to help protect the environment by reducing waste through our products and services, which in turn lowers environmental impacts such as air and water pollution. We have established a Waste, Water & Biodiversity Working Group that will ensure best practices sharing and the update and implementation of relevant mandatory procedures. OUTLOOK In our ongoing efforts to preserve resources, we continue to assess and align our product portfolio against ABB’s Circularity Approach, reduce our waste and the share of waste sent to landfill, increase water efficiency and preserve biodiversity. Moving forward, we will: • Communicate the percentage of our products and solutions covered by our Circularity Approach. • Identify further opportunities to align our products with circularity principles. • Continue to focus on solutions that reduce waste generation at our sites. • Reduce water consumption in water-stressed areas where we and our custom- ers operate, and scale up Alliance for Water Stewardship (AWS) certifications of our sites. • Increase mapping of water and biodiversity risks, impacts in the supply chain and drive risk elimination together with our site operations, suppliers and customers. 88 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We promote social progress We are committed to promoting social progress, benefiting our employees, customers, stakeholders, and communities worldwide. We achieve this by prioritizing health and safety, championing diversity, equity and inclusion, and fostering professional growth within our workforce. Through the devel- opment of our people and active engagement in community programs, we create lasting positive impacts. Our dedication to social progress is rooted in a strong respect for human rights, with zero tolerance for discrimination, as outlined in our Code of Conduct and Human Rights Policy. HIGHLIGHTS • Reached industry-leading low lost-time injury frequency rate (LTIFR) of 0.15 • Launched updated Diversity, Equity and Inclusion (DEI) policy which sets out the core elements of DEI practices that apply to employees in all businesses, divisions, and functions within the ABB Group • Enhanced Human Rights Due Diligence (HRDD) in operations based on the new Human Rights Policy and HRDD Framework and updated human rights training offering • Released guidelines to formalize ABB’s community engagement You are here in the value creation model. 89 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB’s management and targets Business has a crucial role to play in building a prosperous, healthy, and equitable society. ABB is proud to be a good corporate citizen and to contribute to the welfare of our employees, cus- tomers, and suppliers’ workers, communities, and other stakeholders worldwide. Engaging with our stakeholders plays a funda- mental role in defining ABB’s strategic direc- tion and thereby driving our business. We are committed to consistent, transparent com- munication with our key stakeholder groups, including collaborative partnerships, customers, employees, governments and civil society, our investment community, and suppliers. We en- gage in regular and ongoing dialogue with our stakeholders, incorporating their perspectives in ABB’s policies and positions. These valuable insights are also used to inform our double materiality process. The topics which reflect our efforts to pro- mote social progress and that we identified as material comprise health and safety, human rights and labor standards, and employee development and well-being. As part of our Sustainability Agenda, we also focus on diver- sity, equity and inclusion. Our efforts relating to these topics represent a relevant part of how we aim to create value for our stakeholders. Besides the positive impacts on employees through our efforts, they also contribute to our business opportunities and success. Not acting on these topics would adversely lead to risks, through talent attrition, reputational damage, or even sanctions and fines. Four targets have been established under ABB’s Sustainability Agenda to reflect the ways we are working to promote social progress. These targets also support us in successfully deliver- ing on our promises and creating value for all our stakeholders: • Ambition to do zero harm to our employees and contractors, reflected in a gradual reduc- tion of our lost time incident frequency rate. • Increase of women in senior management roles to 25% by 2030. • An engagement score showing top-tier results in our industry. • Expand programs on community engagement. 90 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Health and safety The active management of Health, Safety, Environment and Security (HSE&S) is a natural extension to our business. Our talented and skilled employees are our most valuable asset. Fostering a safe and healthy work environment is a fundamental responsibility of ABB. It is our ambition, therefore, that no person shall suffer injury or ill health as a direct consequence of ABB’s industrial undertaking and that any neg- ative impacts on the economy, society and our environment are minimized This is reflected in our Group-wide HSE&S policy that reinforces ABB’s commitment to putting health, safety, the environment and security at the heart of our activities. This commitment encompasses material sourcing, product de- sign, operations, services and includes safe and healthy working conditions, identifying oppor- tunities to eliminate hazards, reducing risks and adverse impacts and applying risk control and monitoring systems. In addition to monitoring the physical impact on our workforce, mental wellbeing is also a very important topic for ABB. Beside division- and business area-led mental wellbeing initia- tives, the company is providing global support through the Employee Assistance Program as well as the new meQuilibrium app, which is specifically aimed at strengthening the mental resilience of line managers. To realize global leadership in health, safety, and wellbeing in our operations, we have launched our Guiding Principles for Resilient Operations. These sup- port our HSE&S Management System, which is based on internationally recognized standards, principles and commitments. The Guiding Principles combine a more human-centric way of looking at HSE&S topics with our values Courage, Care, Curiosity and Collaboration, and have been agreed to by all divisions and busi- ness areas. They will form the model for HSE&S going forward. The following three Guiding Principles set a framework underpinned by a set of behaviors we strive to follow at every level of our organiza- tion to achieve our objectives: • Lead with care: Means that leaders at every level create an environment where colleagues feel safe, cared for and are confident to speak up. • Engage and involve: Means everyone collab- orates and draws on each other’s knowledge and strengths to ensure colleagues feel in- cluded and encouraged to contribute to our programs and HSE&S performance. • Learn and improve: Means everyone is encour- aged to have the curiosity to learn and to sup- port continuous improvement both as individ- uals and as a team and organization. 91 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes HSE Guiding Principles Each division is encouraged to develop safety programs that are appropriate for their op- erations. We coordinate preparations and responses to emergency situations, conduct in- ternal safety inspections, and obtain third-party verifications for our health, safety and wellbeing reporting. We have well-defined procedures to investigate work-related injuries and incidents and act promptly to mitigate negative impacts. We continuously strive to further reduce health and safety hazards. Thanks to our health and safety measures, we continue to see a downward trend in our lost-time injury frequency rate (LTIFR) to in- dustry-leading levels with a 2024 LTIFR of 0.15. In 2024, we recorded 338 work-related injuries, one workplace-related fatality and one business travel related fatality. An investigation into the workplace-related fatal incident is currently un- derway, and we will draw on the lessons learned to prevent any future recurrence. Lead with Care Engage and Involve Learn and Improve RESILIENT OPERATIONS Taking care of our health, safety and environment ABB WAY 92 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Diversity, Equity and Inclusion We take pride in the diversity of our workforce and seek to create an inclusive culture in which people feel empowered to share their ideas and perspectives. In this way, we encourage creative thinking which drives innovation – which is key to ABB’s growth and success. We believe in diversity across all dimensions and that our dif- ferences make us stronger. That is why progress in diversity, equity and inclusion (DEI) is embed- ded in our long-term objectives. With 2024 marking our fourth consecutive year of dedicated efforts toward Diversity, Equity, and Inclusion, we remain committed to our DEI Strategy 2030. Our annual calendar includes various initiatives and events aiming to create an environment where every employee feels val- ued, respected, and empowered to contribute their unique perspectives. In 2024 we covered women’s history month and inclusion, LGBTQ+ topics and our #ComeAsYouAre campaign, generational diversity in the workplace, and mental health and disability-related awareness, including topics of invisible disabilities, un- derstanding neurodivergence and overcoming imposter syndrome. Events were attended by participants globally, sparking further con- versation and action in our topical Employee Resource Groups (ERGs). Furthermore, effective November 1st, our updated DEI policy went live – reemphasizing our company-wide account- ability towards diversity, equity and inclusion. Additionally, we have developed internal targets for DEI supported by a broad portfolio of ac- tions. These include ensuring an equal gender balance among our early talent hires, providing broad access to ERGs, and improving how we score on inclusion in the workplace in the annual Employee Engagement Survey. These actions support us in achieving our stra- tegic target of increasing the proportion of women in senior management roles to 25 per- cent by 2030. In addition, we have defined fur- ther DEI targets to be met by 2030 as follows: DEI TARGETS 2030 50% female university hires Policies well established for all dimensions 100% employees access to ERGs/Affinity groups 25% women in senior management Score yearly improvement of inclusion score in Employee Engagement Survey 93 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Women in senior management roles In 2024, ABB increased the proportion of female senior managers 1 to 21.3 percent. We facilitate leadership trainings and have put in place tar- geted development activities to ensure a stron- ger gender balance at all levels, including in the leadership pipeline. A number of ABB programs support the inclusion and retention of women in the workplace. Our global gender neutral pa- rental leave program as well as flexible working practices support our employees during the var- ious phases of the employee life cycle. 1. At ABB, senior man- agers are defined as employees in Hay grades 1–7. 0 10 20 30 2024 2023 2022 2021 2020 13.5 16.3 17.8 21.0 21.3 WOMEN ON THE BOARD % WOMEN IN TOTAL WORKFORCE WOMEN IN SENIOR MANAGEMENT % 0 10 20 30 2024 2023 2022 2021 2020 % 0 10 20 30 2024 2023 2022 2021 2020 94 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes ABB Encompass Groups Our aim is to create a welcoming environment in which people have a sense of belonging and can realize their full potential, both as individ- uals and collectively. With a workforce span- ning five generations, we foster collaboration through employee resource networks, various mentorship models, collaborative workshops and age-diverse teams. Our global employee re- source groups (ERGs), also known as Encompass Groups, reflect a diverse body of people, en- compassing focus areas like gender, LGBTQ+, abilities, generations, ethnicity, and diversity of thought. They aim to create an inclusive, dy- namic work environment that enhances morale and engagement, helping attract and retain diverse talent. By offering networking, confi- dential support, and open communication with leadership, we address common concerns and promote mentoring, education, and leadership development among employees. During 2024, an upskilling program was launched targeting our ERG leaders to bring them to the next level of maturity. Our commitment to diversity, equity and inclusion extends beyond our immediate workplace, as ABB partners with organizations including United Nations Women Empowerment Principles (UN WEPs), UN Standards of Conduct Tackling Discrimination against Lesbian, Gay, Bi, Trans, & Intersex People, Society of Women Engineers, Special Olympics. ABB ENCOMPASS GROUPS Employee driven networks moving the needle on the ground Encompass Senior Professionals Encompass Young Professionals Encompass Asian Professionals Encompass Diversity & Inclusion Encompass Military & Allies Encompass Black Professionals Encompass Pride Encompass Hispanic- LatinX Encompass Women Encompass Disabled Professionals 95 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Employee development And wellbeing Employees bring valuable skills, drive produc- tivity, foster innovation and contribute to ABB’s culture and values. They are vital for achieving our goals and staying competitive. Investing in the professional and personal de- velopment of our people is a key element of our long-term success. It supports the satisfaction and wellbeing of our employees, nurtures mo- tivation and innovation, and facilitates talent attraction and retention. We are therefore committed to maintaining an open dialogue with current, former and future employees of ABB. We have multiple tools in place that enable our employees to make their voices heard. These include formalized and/or elected bodies of employee representatives that deal with management of labor practices, among other topics. Our annual Employee Engagement Survey helps managers better understand the experiences of our employees at ABB and how they feel about their jobs and the company. The survey also gives employees a channel to highlight oppor- tunities for improvements in the workplace and ask for support to achieve the goals of their team or manage challenges that they may face. As the foundation of our organization, the per- spectives of our employees influence our busi- ness strategy and operations. In 2024, our employee engagement score was 78 out of 100, up from 71 in 2019. In total, 85 percent of employees, nearly 92,000 people, responded to the survey, which represents a sig- nificant increase since 2019, when the response rate was 65 percent. The results are bench- marked by our external survey provider against a broader set of companies that ask similar survey questions. This allows us to monitor our ambition of achieving a top-tier score. Our 2024 results highlight strengths in relation to safety, climate, integrity and role clarity. The survey also showed that, while we have made good progress on removing barriers to execution, there is still room for improvement. In addition, in 2024 a de- cision was made to raise the bar and set a target to benchmark with the top 25 percent external peers using the engagement platform. Development Learning and upskilling our people is a key focus area. Educational offerings are made available to our employees online and offline. This year, the number of learning hours per FTE increased to 8.4 (24 percent increase compared to previ- ous year). Our Learn, Connect, Grow (LCG) ap- proach fosters employee development through online and offline training, career resources, and peer learning opportunities. LCG Day, held annu- ally, features keynote speakers, inspiring stories, and activities that promote learning, connec- tions, and growth across the organization. We strive to give our employees the skills they need to adapt to change and stay competitive in a constantly evolving business environment. As part of our ongoing efforts to improve the quality of people performance management and its impact on individual development and growth, we are moving from a traditional “Management by Objectives” to continuous, meaningful performance conversations, sup- ported by emerging technology. While this tech- nology will play a crucial role in the future, our focus remains on change management and the required cultural shift. To enhance the link between performance and development, we launched a training program in December 2024. This includes videos show- casing effective and less effective performance reviews. Non-managerial employees will re- ceive concise learning materials to improve their conversation skills, while managers will participate in a 90-minute workshop featur- ing personal video analysis, exercises, and strategy development. Employee wellbeing Whether it’s coping with current life challenges, preparing for a new life experience, personal or work-related experiences, ABB takes employee wellbeing seriously and ensures that colleagues and their family members feel supported by us. We also offer individual learning pathways, un- conscious bias training, and research-backed resources to systematically drive awareness, en- gagement and progress. For example, we have reviewed our processes and policies and piloted 96 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes LGBTQ+ reverse mentoring programs to im- prove understanding and inclusion in the work- place. We will continue to explore opportunities to facilitate diversity, equity and inclusion, striv- ing for an environment where every employee knows their uniqueness is an asset that adds value to our company. This creates shared value in the workplace, marketplace and community. As part of our global Employee Assistance Program (EAP), employees have access to up to six counselling sessions per topic, per year. Topics of counseling session can include im- proving relationships, surviving the loss of a loved one, parenting, couples’ support, refer- rals to local finance or legal sources, managing stress, and managing workplace pressure, among others. In 2024 we launched an updated EAP application intended to make it easier for employees and their families to access the sup- port they require. We also launched an additional mental health resource for line managers through a new appli- cation. This application allows line managers to manage burnout, stress and anxiety by devel- oping resilience through personalized learning tailored to their individual needs and helps them to recognize and manage this with their teams. Support for such a program is provided on a confidential basis. While we see overall utiliza- tion of our support programs increasing, we continue to look for ways to further publicize the support available from these programs. 97 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Community engagement and protection of vulnerable communities ABB is committed to creating a more prosper- ous and sustainable future for the communities in which we operate, ensuring that our efforts make a meaningful and sustainable impact. We are committed to mitigating and remedying negative impacts that might occur in our value chain, while promoting long-lasting initiatives to generate positive value and create opportuni- ties for these communities. ABB acknowledges the importance of being recognized as a good corporate citizen to ensure its social license to operate. For this purpose, ABB identified Four Focus Areas (4Es) of intervention aligned with ABB’s Sustainability Agenda, to enhance the efforts towards communities and optimize its return of Community Engagement Programs. ABB’s approach to community engagement entails stakeholder engagement, strategic cor- porate partnerships and country-level projects to address local needs. Our company’s and em- ployees’ contributions make a real difference in people’s lives, and we are proud of our employ- ees for donating both time and money to help others in need. In 2024 we donated $9 million by employees and business areas, 6,105 volunteering days, and we supported 605 projects in 41 countries. ABB’S FOUR FOCUS AREAS Education Ensure equitable access to Science, Technology, Engineering and Mathematics (STEM) education and build the next generation’s lifelong competence and soft skills, leveraging technology, sustainability, ƏƜƒ ƗƜƜƝƤƏƢƗƝƜ Emergency & Disaster Relief Support communities and employees impacted by natural disasters and educate our employees on disaster relief readiness. 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. Environment and conservation Support communities in biodiversity conservation, protecting land, marine and freshwater ecosystems, mitigating environmental and social impacts and offering new development opportunities. 1 2 3 4 98 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes As part of the target to expand programs for community engagement, in 2024 we released a new internal guideline to formalize the compa- ny’s community engagement strategy and pro- vide direction on developing projects aligned with ABB’s Sustainability Agenda and ABB’s Four Focus Areas (4Es) of intervention. We also formalized a group level governance creating a dedicated working group with repre- sentation from each business area to manage the topic. 41 countries engaged $9 million donated by employees and business areas 6,105 person-days in volunteer work 605 projects supported worldwide 99 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Focus on customers Customers are at the center of everything we do. ABB interacts with its customers by prior- itizing safety, transparency, and privacy while addressing potential risks and leveraging technological advancements. ABB ensures that customers have access to quality information, empowering them to make informed decisions and fostering transparency throughout the value chain. This approach enhances confidence in ABB’s products with regard to ethical prac- tices related to worker’s rights, supply chain management, and data processing. Additionally, ABB’s strong focus on privacy builds trust and confidence among customers and business partners by safeguarding personal information and respecting individual rights. This commit- ment to privacy not only protects customer satisfaction but also strengthens our reputa- tion as a company, contributing to long-term loyalty and positive brand perception. ABB also acknowledges the risks associated with cyber attacks and connectivity, implementing robust cyber security measures to protect its informa- tion technology, infrastructure, and intellectual property. By addressing these challenges and continuously improving its digital processes, ABB aims to maintain customer satisfaction and mitigate potential negative impacts on its brand and operations. Furthermore, ABB’s implementation of strong safety measures and clear instructions for the use-phase of our prod- ucts significantly mitigates the likelihood of safety incidents, ensuring a safer experience for customers and reinforcing ABB’s commitment to their wellbeing. Ultimately, ABB customers trust our innovative, high-quality products and services. With our leading technologies in elec- trification and automation, we help all indus- tries run at high performance and become more productive, efficient and sustainable so they can outperform. 100 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Human rights and labor standards ABB is committed to respecting the dignity and human rights of all people. Our goal is for hu- man rights to be well understood and managed along our entire value chain and integrated into ABB’s daily business. We support and respect the international frame- works to identify, mitigate, and address human rights risks and impacts, embedding respon- sible business conduct in business processes, tracking and communicating performance and allowing access to grievance and remedy for potentially affected people. These frameworks are set out in our Human Rights Policy and in- clude the United Nations’ Guiding Principles on Business and Human Rights (UNGPs), and the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct. Our Code of Conduct, Supplier Code of Conduct and our Human Rights Policy establish our commit- ments to human rights and expectations for each individual working at ABB or engaging with ABB’s business in the entire value chain. The ABB Human Rights Due Diligence (HRDD) Framework released in 2023 clarifies governance and how the commitment is executed in the organization. In 2024, we continued our work to strengthen our human rights due diligence across ABB’s entire value chain, as well as implementing the roadmap that was updated in 2023, following up on business areas risks analysis and identi- fied salient issues. Further, we partnered with organizations like Global Business Initiative on Human Rights (GBI), International Code of Conduct Association (ICoCA), International Committee of the Red Cross (ICRC), and United Nations Global Compact (UNGC). We worked to align the governance to the new HRDD framework and to the ABB Way oper- ating model: a cross-business area Human Rights Working Group has been consolidated led by the Motion business area and integrated into the broader ABB Sustainability gover- nance. Each business area is represented to ensure core and common aspects are jointly agreed, and that we can drive the human rights agenda consistently across the organization and divisions. Our Human Rights Champion network, established in 2019, continues to grow and to support the business in dealing with human rights challenges. It is a strategic tool to test the effectiveness of human rights programs and to get valuable feedback for continuous improvements. In 2024, we continued offering general human rights training to all employees and managers, including specialized procurement training on topics like child labor and modern slavery. We also launched a new training course on the up- dated ABB Human Rights Policy; in total 7,313 training sessions were completed, totaling 5,503 hours. A refresher training for division leadership teams was deployed, with around 60 percent of divisions trained, and this program will continue into 2025. We also focused on human rights and security, with 62 percent of Security Council members completing a module on the use of force by private security providers through the ICoCA training platform, and 95 percent of ABB security managers completing a new module on child labor. In 2024 we revised our human rights training offering, developing new virtual modules for sales, operations, and procurement functions. These modules are aligned with our salient is- sues, like modern slavery and child labor, and are part of a new training matrix to be deployed in 2025. Our partnership with ICoCA also promotes their human rights and security training to ABB managers in high-risk countries where ABB has a physical presence. In operations, we published the new Human Rights Requirements and ACOP (Approved Code of Practice) to enhance human rights due dili- gence in ABB operations. This initiative will be followed up by a new wave of site assessments to ensure execution of defined requirements aligned with the new ABB Human Rights Policy. In sales, we continued screening human rights risks in sales opportunities, gathering feedback on current processes and challenges of the or- ganization and designing a new proposal to be tested in 2025 for further improvement. → For more information related to our grievance mechanism and reme- diation process, please refer to the Integrity section of this report. → See ABB’s Code of Conduct and Supplier Code of Conduct. 101 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes To address human rights risks related to our suppliers, we rely on our Sustainable Supply Base Management program and our conflict minerals management program. The grievance mechanism and the remediation process, including for harassment, forced labor, child labor and other human rights related inci- dents reported through our Business Ethics help- line, are included in the statistics about reported incidents in the “We embed a culture of integrity along the extended value chain” chapter. In 2024, there were no reported incidents of child labor with respect to our employees. In 2024, four concerns of forced labor, com- pulsory labor and child labor relating to supply chain providers were identified. Two remain under review and two concerns were not substantiated. Labor rights among our employees Approximately 45 percent of ABB’s employees worldwide are covered by collective bargaining agreements (CBAs), either by collective labor agreements at the industry level (generally with unions) or at the company or location level (gener- ally with employee representative bodies such as works councils or unions). Approximately 34 per- cent of employees are covered by internal em- ployee representatives. In addition, the European Works Council represents more than 50,000 ABB employees, covering the majority of employees in countries belonging to the European Economic Area (EEA), UK or Switzerland. For employees not covered by collective bar- gaining agreements, there are different sce- narios regarding the determination of working conditions. In many countries where not all employees are represented by the CBA, the con- ditions in the CBA that go beyond local labor market practices are considered in determining working conditions and terms. Regardless of the application of a CBA, ABB in general aims to offer working conditions that meet or exceed the typical standards in the respective local employment markets. OUTLOOK Maintaining a respectful, inclusive and diverse working environment while pro- moting the wellbeing of our people, maximizing safety, investing in professional and personal development and taking care of the communities where we operate will remain key to the success of ABB’s value proposition. To further progress on our targets related to promoting social progress, we intend to: • Continue to deploy human rights trainings to leadership teams. • Continue to enhance our human rights due diligence across ABB’s value chain. • Continue to increase the number of women in senior management. • Continue to expand programs for community engagement. • Increase our focus on avoiding incidents that have the potential to do serious harm to our employees and contractors. → For further information on these two programs, please refer to the Responsible Sourcing section of this report. → For information about findings of non-con- formance within our supply chain, please refer to the Responsible Sourcing section of this report. 102 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We embed a culture of integrity and transparency along the extended value chain At ABB, integrity and transparency define how we do business. They are the foundation of our Sustainability Agenda and underpin our value creation. We recognize the importance of doing business ethically and maintaining ethical business relationships. In 2024, we built upon the actions we took in 2023, with a focus on embedding integrity processes within each of our business areas. In this chapter, we highlight key actions taken in 2024 to strengthen a culture of integrity and transparency along our extended value chain. HIGHLIGHTS Third Party Management (TPM) This year, we enhanced the TPM framework and tested its implementation, develop- ing comprehensive monitoring and risk mitigation guidance. Legacy risk management In 2024 we focused on risk management of our legacy suppliers and sales channel third party relationships. Bespoke business areas risk management plans Our business areas developed specific plans to monitor and mitigate their third-party risks with a focus on resourcing for sustaining operations. Integrity culture We strengthened our integrity culture in 2024 by revamping our Straight Talk program for all-em- ployee learning, enhancing risk specific training for sales employees, and shared greater investi- gation insights for transparency, awareness and risk management. Data analytics and integrity risk monitoring ABB uses various tools and platforms to track progress and drive performance in regard to our integrity approach. Our continuous monitoring platform allows us to analyze potential integrity risks based on continued risk assessment and lessons learned from past cases. In 2024 we enhanced our Risk and Implementation Dashboards to allow us to mon- itor a broader range of metrics. The increased availability of this data allows our organization to proactively identify integrity risks and op- portunities and analyze trends and program enhancement outcomes. Supplier Code of Conduct In 2024, our updated Supplier Code of Conduct went into effect. To support the roll-out, we organized high-level training sessions for our suppliers in multiple languages. Several deep dive trainings covering different topics of the supplier code were developed and made avail- able for ABB personnel. Sustainable Supply Base Management To align with our updated Supplier Code of Conduct, we have thoroughly reviewed and updated the assessment protocol for on-site supplier assessments. In line with changes in country risk profiles, ABB product portfolio and supplier base, we have re- viewed and updated our list of focus countries. You are here in the value creation model. 103 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Integrity We continuously work on improving and en- hancing our Global Integrity Program through controls, processes and a culture that deters non-compliance behavior and drives trans- parency and sustainable business. Our five core Integrity & Regulatory Affairs procedures include oversight and responsibilities for ac- countability, as well as procedures related to third-party management, data privacy, conflicts of interest and global trade. We have defined five integrity principles that guide everything we do at ABB: 1. We behave and do business in an ethical way. 2. We work in a safe and sustainable way. 3. We build trust with all stakeholders. 4. We protect ABB’s assets and reputation. 5. We speak up and do not retaliate. The ABB Code of Conduct is our individual and collective commitment to uphold the highest standards of business ethics throughout our global value chain. It guides our employees, business partners and suppliers to do business with integrity. Our Global Integrity Program includes integrity learnings and communications. The learning modules are delivered in a virtual e-learning format as well as face-to-face. We actively pro- mote self-driven learning for all employees, supplemented by bespoke and role-specific mandatory training for those that face higher in- tegrity risks. Alongside these integrity-focused learning modules, managers at all levels of the company are expected to model integrity behav- iors and hold team discussions to ensure that our teams understand what is expected when it comes to ethical conduct and treating people with respect. Integrity Committees in all busi- ness areas and divisions support this approach. In 2024, we continued to develop our integrity learning programs and focused on strengthen- ing our integrity culture. This included revamp- ing our Straight Talk learning platform, which continues to provide impactful real-life integrity learnings at ABB in support of our speak-up culture. We also created a new antitrust foun- dation training, and added other new integrity content on behavior drivers to the integrity awareness portal. Our business areas also im- plemented tailored integrity learning programs for their teams, based on their bespoke risk management plans. We enhanced our Business Ethics Helpline and reporting capabilities. We empowered business area teams to directly conduct investigations to increase accountability for workplace behavior within those business areas. To track potential indicators of the effective- ness of our integrity-related initiatives, and as- sess risk, we utilize data analytics. Our Integrity Analytics Report, a live dashboard available throughout ABB via our integrity web portal, provides insights into our integrity program performance and is available to our employee population. Our Investigation Dashboards are also made available to the appropriate stake- holders as part of our risk assessment and management strategy. Risk assessment abilities were further enhanced in 2024 with the creation of the Risk Monitoring Dashboard. This dash- board supplements the existing integrity and investigations metrics with additional metrics and risk scoring capabilities to identify poten- tial areas of heightened risk for business focus. In 2024, our trust and engagement KPIs were as follows for the period 2021–2024: • Trust KPI – the rate of severity level 1 and 2 investigations where the reporters disclosed their identity, as a measure of trust in the re- porting system and integrity program: 55 per- cent of reporters as compared to 60 percent in the period 2021–2023. • Engagement KPI – the volume of unique vis- itors on the Integrity Awareness Portal for integrity learnings: 82 percent of employees with online access, as compared to 80 percent in the period 2021–2023. → See ABB’s Code of Conduct and Supplier Code of Conduct. 104 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Anti-Bribery & Anti-Corruption ABB has a “zero tolerance” policy towards uneth- ical business behavior including any form of brib- ery or corruption. Having a robust anti-bribery and anti-corruption (ABAC) control framework and a strong ethical culture is essential for ensur- ing that we comply with our legal responsibilities and preserve our license to operate. Our ABAC training program centers on the upskilling of em- ployees in gatekeeper functions and customer facing roles across ABB. The ABAC training pro- gram aims to enhance core ABAC competencies while highlighting the critical role these individ- uals play in upholding our integrity culture and compliance obligations. Our actions to enhance our culture of integrity continue to focus on: • remediating the root causes of misconduct, through internal control enhancements at the local level where they occurred, and through global process enhancements where appropriate; • applying learnings to drive company-wide awareness, workplace safety and a strong culture with individual accountability for integrity; • innovating ABB’s monitoring and testing ac- tivities and the platforms and tools we use for strong risk management and integrity assurance, including our continuous mon- itoring platform, aimed to detect integrity risk, with a specific focus on ABAC and fraud risks, by leveraging risk algorithms as ap- plied to company data points across many company systems. In 2024, we continued to embed our enhanced ABAC policies and procedures within our busi- ness areas and tested their implementation. We developed business area risk management plans, tailored to mitigate the risks specific to their businesses, and focused on risk manage- ment of our legacy third party relationships. We completed the second year of our Deferred Prosecution Agreement (DPA) with the United States Department of Justice (DOJ) and Securities and Exchange Commission (SEC) pursuant to a rigorous work plan focused on these enhancements and innovations for op- erational sustainability. Under the DPA, for the three-year period, we will continue to self-re- port on continual enhancements to our integrity program to ensure that our controls, processes and culture serve as effective deterrents to bribery and corruption and support transparent sustainable business. Our integrity program goes beyond ABAC and workplace behavior and includes trade and anti- trust as well as data privacy and cyber security. ABAC Program Area of Risk 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. Donations & Sponsorships Ethical business Stakeholder trust Transparent value chain Protect license to operate Speak-up culture Gifts, Travel & Hospitality Third Party Management Books & Records / Internal Controls Facilitation and Safety Payments Conflicts of Interest and HR Payments M&A and Joint Ventures Tender Risk Review and Project Review Organization, Roles & Responsibilities Policies and Procedures Risk Management & Oversight Communication, Training and Awareness Risk Assessments Data Analytics and Monitoring Reporting Channels Code of Conduct Global Policies and Procedures ABAC Program Objectives Core Governing Policy & Procedures em- bedding ABAC controls Local require- ments (country-spe- cific) ABAC FRAMEWORK 105 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Trade compliance program We act in a global environment and comply with applicable trade laws and regulations, including those relating to import and export controls, trade sanctions and customs procedures, and we expect our business partners to do the same. As reflected in ABB’s Code of Conduct, ABB’s Trade Compliance framework includes our Global Trade Compliance Procedure (GTCP), specific in- structions and guidance documents for the busi- ness to embed trade compliance requirements into day-to-day processes. The extensive net- work of trade officers work together with other functions across the organization providing advice, raising awareness by delivering training, disseminating regulatory updates and in general, supporting the implementation of processes and controls intended to mitigate trade risks. Antitrust compliance program ABB’s antitrust compliance program is guided by a suite of guidance notes, procedures and internal controls specifically addressing ABB’s global antitrust risks. These are integrated into ABB’s culture and internal controls through dedicated training of legal and business com- munities, the provision of specific expert anti- trust advice as well as regular internal exchange forums to raise awareness of antitrust topics of relevance to our operations. Our antitrust experts work closely with our colleagues from ABB’s investigations practices to facilitate the identification, investigation and remediation of any antitrust concerns. Importantly, a strong antitrust ethos permeates ABB’s mergers & acquisitions activities, including through the performance of due diligence prior to invest- ments, acquisitions or joint ventures, to support healthy and compliant company growth. Data privacy and cyber security We ensure the protection of customer, employee and other individual privacy and personal data and implement robust measures to protect their rights and safeguard against cyber threats. Respecting the right to data protection is a priority for us and we have adopted global data protection standards to ensure a high, stan- dardized level of protection for personal data. We monitor and review compliance with data, privacy and cyber security laws, by means of data protection audits, assessments and other controls. All ABB employees are made aware of the basics of data privacy and cyber security with specialized learning available to all em- ployees and job-specific training provided for selected job functions. Grievance and remediation At ABB, we are committed to a culture of ethics and transparency and encourage our people to speak up. We offer multiple channels for our 106 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes stakeholders to report integrity violations and non-compliance with our Code of Conduct. We intend to make this process as straightforward and seamless as possible. Confidential report- ing processes are available for both employees and our broader community of stakeholders, including options for anonymous reporting. Our commitment to non-retaliation applies when- ever someone has raised a potential integrity concern in good faith, including cooperation in an investigation. ABB’s business ethics helpline permits web and phone reporting and is operated by an indepen- dent service provider, which forwards the report to a dedicated investigations team within the Legal & Integrity function at ABB headquarters or, in EU countries where required by law, to a local representative of the chosen ABB partner company. All reports are subject to appropri- ate review and are brought to full closure using systematic processes and tracking systems so that due process is followed across our internal investigations. An employee or stakeholder who files a report can follow up on the status of their report and continue to engage with the ABB investigator using a personal PIN. The helpline permits reporting on conduct relating to all aspects of the ABB Code of Conduct, including corruption, fraud, trade compliance, antitrust, data privacy, workplace behavior, human rights, environment, occupational health and safety vi- olations, workplace violence, and more. Incidents reported in 2024 We have seen an increase in total incidents reported to our business ethics helpline since 2022. We attribute this to an increased confi- dence in our reporting and allegation manage- ment processes coupled with more in-person interactions in the wake of the pandemic. In 2024, incidents reported were structured into the following categories (as well as more de- tailed subcategories within each of these) to ensure appropriate attention, resourcing and internal escalation: • 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 issue The following table provides an overview of the number of incidents reported through our Business Ethics Helpline. Business Ethics Helpline In 2024 Incidents reported 2,242 Incidents closed 2,578 The themes of trafficking in human beings, forced labor, compulsory labor and child labor are all addressed in the ABB Supplier Code of Conduct. In 2024, four concerns of this nature relating to supply chain providers were iden- tified. Two remain under review, and two con- cerns were not substantiated. 107 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Responsible sourcing ABB is committed to sourcing responsibly and will only work with suppliers that share our com- mitment to integrity, sustainability and human rights and have agreed to the requirements set out in the Supplier Code of Conduct. Therefore, the ABB Supplier Code of Conduct is part of our procurement terms and conditions as well as our supplier qualification, development and evaluation requirements. The ABB Supplier Code of Conduct was updated in 2023 and became effective on January 1, 2024. It explains in detail what we expect of our suppliers. The updated version addresses the latest changes in regulatory requirements such as the German Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz, LkSG) and the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-Affected Areas and Child Labour (DDTrO). It also acknowledges the international human rights and environmental guidance and conventions, takes account of stakeholder ex- pectations and emphasizes the role of suppli- ers in preventing and mitigating sustainability risks, especially when it comes to upholding human rights and reducing GHG emissions. The updated implementation guide for the Supplier Code provides suppliers with hands-on advice on how to fulfill ABB’s requirements and fa- cilitates the effective implementation of the Supplier Code of Conduct. In seeking to prevent human rights violations in our supply chain, we substantively revised the section on “Human rights and decent work” in our Supplier Code and included more specific requirements regarding modern slavery, harass- ment, discrimination and diversity, as well as the rights of local communities and vulnerable groups. Furthermore, a section on “Climate and environment” was added to reflect our intensi- fied efforts to mitigate climate change. We have expanded the list of potential environmental impacts to include topics of growing interest to our stakeholders, such as GHG emissions, circularity, biodiversity and deforestation. The updated Supplier Code explicitly requires suppliers to disseminate and enforce these requirements across their own supply chains and to report any suspected violations. At the start of 2024, we provided high-level awareness training to our suppliers, followed by deep dive trainings for ABB employees later in the year, covering different topics of the Supplier Code, such as child labor and modern slavery. In 2025, we will make deep dive trainings available more generally and focus on providing these trainings to our suppliers. After performing a risk review, we updated our list of focus countries to reflect both the changed composition of the ABB supplier base and changes in risk levels of countries our sup- pliers are based in. Implementation activities are ongoing for newly added countries. We use our Third Party Management program to assess and manage risks as well as to on- board and monitor engagement with third parties across the entire value chain, including upstream (suppliers) and downstream (custom- ers). It involves the following elements: • Risk-based front-end due diligence prior to considering engagement; • Appointments subject to structured approval processes; • Standard agreement that should include an- ti-bribery provisions, audit rights and the right to terminate agreements for any viola- tion; and • Risk-appropriate monitoring over the life cycle of the engagement. The ABB Sustainable Supply Base Management (SSBM) Program is part of ABB’s Third Party Management approach. As part of the SSBM program, we assess suppliers for their sustain- ability performance and mitigate risks identi- fied. This involves a supplier self-assessment during the onboarding process, and subsequent further due diligence in case of high-risk scores, including mandatory onsite audits according to the Generic Protocol in focus and high-risk countries. Additionally, we perform sustainabil- ity assessments in focus countries on existing suppliers using the SSBM Country Specific Assessment Protocol. In 2024, we updated this protocol to align with the updated requirements in the Supplier Code. After adjusting the SSBM Country Specific Protocol in 2023 to permit audits of temporary labor suppliers, we continued with pilots in multiple countries. → See ABB’s Supplier Code of Conduct. 108 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes As reported in 2023, an audit conducted in one pilot country resulted in finding instances of local labor law violations at a temporary labor supplier. In alignment with the ABB Human Rights Due Diligence Framework and the ABB Supplier Code of Conduct, we worked with the supplier to ensure understanding of ABB requirements, and to define and implement cor- rective actions. In 2024, the case was internally escalated, and a decision was taken to compen- sate all of the supplier’s impacted employees linked to ABB operations and to terminate the relationship with the supplier. As result of this case and other pilot audits, the external labor provider category is now included into the SSBM audit scope, and the case is used in internal hu- man rights training as a learning for leadership and procurement teams. To understand risks related to our upstream supply chain, we conducted a few pilot assess- ments at Tier-2 suppliers. We will continue with this pilot in 2025. At the end of 2024, we re- viewed the top ten non-conformities identified during on-site assessments in the years 2021 to 2024. This list will inform our interventions with suppliers in 2025. Outcomes of cases reported to our Business Ethics helpline (see Human Rights section for details) will be used for the same purpose. At the end of 2024, 68 percent of our spending on high-risk suppliers in focus countries was covered by our SSBM program, and 87 percent of identified risks were closed. TRACKING RESPONSIBLE SOURCING 2024 2023 Suppliers assessed on site (number) 156 118 High-risk supply spending in focus countries covered by SSBM (%) 68 42 Risk closure rate (%) 87 88 Contracts terminated 12 7 Employees trained on responsible sourcing (SSBM) 1 318 959 Supplier teams trained on responsible sourcing 791 95 1. Divided over different training programs 109 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes Conflict minerals and child labor Doing business with integrity and transparency means that materials intended for our prod- ucts and services should be sourced and pro- cured ethically. ABB is an active member of the Responsible Minerals Initiative, where we lead the Asia Smelter Outreach team. ABB commits to sourcing minerals and metals responsibly, as described in the ABB Policy on Conflict Minerals. We have established a “Conflict Minerals Compliance Program” based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas and other appropriate inter- national standards. We actively work with our suppliers to ensure that any minerals contained in the products and materials supplied to ABB originate from conflict-free sources and to tran- sition away from smelters and refiners that have been defined as high-risk. Beyond 3TG (Tin, Tungsten, Tantalum and Gold) our program also includes Cobalt, and is being extended to also include Mica going forward. In response to the requirements established by Art. 964j–l of the Swiss Code of Obligations and the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-Affected Areas and Child Labour (DDTrO), we have assessed our respective risk exposure and reached the following conclusions: • The quantities of minerals and metals in scope of the aforementioned regulations which ABB imported into or processed in Switzerland in 2024 are substantially below applicable thresholds. Hence, ABB is exempted from spe- cific due diligence and reporting obligations under the DDTrO in regard to conflict minerals. → Read more in our ABB Policy on Conflict Minerals 2024. 110 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes OUTLOOK Integrity and transparency are the foundations of our Sustainability Agenda. In 2025, we will further strengthen our approach and focus on the following initiatives: • After updating our Code of Conduct and Human Rights Policy, we will drive im- plementation and listen to signals. • Continue to work on enhancing our training offers, conducting new deep dive trainings aligned with our salient issues • Enhance due diligence incorporating further minerals. • Using our human rights roadmap, we will investigate technological solutions and artificial intelligence to strengthen the risk mapping of our value chains. • In 2024, as part of our continuous improve- ment program, we aligned our risk assess- ment to the salient issues and to the new Supplier Code of Conduct, and we extended the SSBM program to new focus countries. This approach confirms alignment with ILO Conventions 138 and 182 as well as the ILO- IOE Child Labour Guidance Tool for Business of December 15, 2015, and the UN Guiding Principles on Business and Human Rights. The aforementioned frameworks and standards include those which the DDTrO specifies as internationally recognized equivalent regula- tions for child labor. As a result of our adher- ence to these frameworks and standards, we are exempted from specific due diligence and reporting obligations under the DDTrO in re- gard to child labor. • At the end of 2024, a concern of child labor related to our supply chain was received (this concern is also reported under the Human Rights section). This concern is under review. 111 ABB INTEGRATED REPORT 2024 Introduction Value creation Good governance Performance-based compensation Appendix Outputs and Outcomes We help industries outrun – leaner and cleaner: case studies ABB’s advanced technologies are only as powerful as the ways in which they are applied and used to deliver value for our customers and the greater environment and society. Our technologies support our customers across a variety of industries to be more productive, ef- ficient and sustainable so they can outperform. Our automation technologies help improve productivity and efficiency of critical day-to- day operations. Our electrification technologies help decarbonize energy intensive industries, from power and manufacturing, all the way to transportation and buildings. Through our Sustainability Agenda we deliver value to stakeholders by enabling a low-carbon society, supporting the preservation of re- sources and promoting social progress. Within these key pillars, we are working hard to enable the energy transition, decarbonize energy-inten- sive industries, promote principles of circularity and promote social progress. In these pages, we present a selection of cases that exemplify how ABB’s technologies have been applied to deliver on our customers’ needs and on our own sustainability ambitions. Sustainability pillars the project contributes to: Low-carbon society Preserving resources Promoting social progress 112 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Appendix Good governance Performance-based compensation ENABLING THE ENERGY TRANSITION Through leading technologies, ABB is enabling the transition to a low-carbon society. We do so on a large scale, by implementing grid-level products and services, as well as changing how we power our every day. Our ambition is to address today’s greatest energy-related challenges, delivering comprehensive solutions that enable the transition to green energy and ensuring grid stability as renewable energy sources come on board. Low-carbon society ABB’s technology to stabilize the power grid as Spanish islands transition to green energy A significant challenge of the clean energy tran- sition is ensuring that existing power grids are able to take on new distributed energy tech- nologies while maintaining stability. ABB has been working with Red Eléctrica, the Redeia company responsible for the transmission and operation of the Spanish electricity system (TSO), to smooth the grid’s onboarding of in- termittent energy sources on the Canary and Balearic Islands. The advance of the energy transition in both archipelagos poses a challenge for the system operator which makes it necessary to reinforce the grid to maintain its balance and ensure re- liable and resilient operations. ABB is working with Red Eléctrica to deploy a flexible, reliable and integrated solution through synchronous condensers. These rotating electrical machines mimic the operation of large generators to help stabilize the grid when loads and renewable en- ergy production fluctuate. The integrated solution, which also includes electrical and automation equipment, will be crucial for maintaining the stability, reliability and continuity of island grids as they integrate increasing levels of renewable energy. The ABB Ability™ System 800xA® distributed control system will also play a key part in ensur- ing the stability of energy supplied from inter- mittent renewable sources. The project is part of the Network Development Plan 2021–2026, the execution of which will al- low the integration of 67 percent of renewable energy into Spain’s generation mix. 113 Outputs and Outcomes Introduction Value creation Good governance Performance-based compensation Appendix Low-carbon society Supplying key technology to Washington State Ferries’ new electric vessels The maritime sector, responsible for about three percent of global greenhouse gas emis- sions, faces challenging net-zero targets. The International Maritime Organization aims for a 20-30 percent reduction by 2030 and net-zero emissions by 2050. Vessel electrification is part of the solution and is already well in use for vessels on shorter routes with access to charging infrastructure. ABB is working with Washington State Ferries (WSF) which manages the largest ferry system in the United States, operating 21 auto-passen- ger ferries across 10 routes serving 19 terminals. ABB was selected as the single source vendor for the propulsion system of five new hybrid ferries. This partnership marks a significant step toward sustainable maritime transpor- tation, with ABB playing an important role in the development and delivery of the five newly built vessels. ABB will supply comprehensive hybrid electric propulsion systems that include the Onboard DC Grid™ power distribution solution, energy storage, advanced energy management and in- tegrated marine automation. The innovative propulsion package is designed to enhance operational efficiency, help reduce emissions and ensure reliable performance for the new vessels, thereby supporting our delivery of a low-carbon society. ABB will also deliver extensive design and engineering support, working closely with WSF to ensure seamless in- tegration of the hybrid electric technology into the new ferries. The five new hybrid electric ferries will be the first of 16 new vessels delivered as part of WSF’s $3.98 billion Ferry System Electrification plan. The new ferries will play a crucial role in WSF’s strategy to modernize its fleet and reduce its environmental footprint. By integrating ABB’s propulsion systems, WSF aims to achieve sig- nificant reductions in fuel consumption and greenhouse gas emissions in pursuit of a ze- ro-emission ferry fleet by 2050 in alignment with the state’s broader environmental goals. 114 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Appendix Good governance Performance-based compensation Low-carbon society Preserving resources ABB and CERN identify energy-saving opportu- nity in cooling and ventilation motors The European Organization for Nuclear Research, or CERN, is the world’s largest laboratory for par- ticle physics. ABB has partnered with CERN to reduce the laboratory’s environmental footprint and improve the performance of the research infrastructure. ABB and CERN have identified a significant energy-saving opportunity of up to 17.4% in the cooling and ventilation motors used at CERN’s facilities, focusing on improving en- ergy efficiency and reducing operational costs. By upgrading to high-efficiency motors and im- plementing advanced control technologies, the two organizations aim to dramatically improve the energy efficiency of systems critical to main- taining the cooling conditions for CERN’s parti- cle accelerators and other experiments. The energy-saving potential stems from replac- ing outdated motors with ABB’s energy-effi- cient models and utilizing digital monitoring systems for real-time optimization. This ap- proach will not only reduce energy consumption but also minimize CO₂ emissions, contributing to CERN’s sustainability goals. The energy sav- ings will help lower operational costs and re- duce the environmental footprint of the facility, preserving valuable resources. The partnership highlights the importance of smart solutions for large-scale research facili- ties, where energy demand is high. ABB’s digital motor control solutions will enable real-time monitoring and performance optimization, ensuring continuous energy savings over time. By enhancing motor efficiency, CERN can cut energy use, further aligning with its sustainabil- ity goals and improving the performance of its research infrastructure. This initiative exemplifies the importance of digitalization, industrial automation and electrification technologies in driving energy efficiency, demonstrating how cutting-edge solutions can help reduce the environmental footprint of high-energy operations like CERN’s. The collaboration is a step toward greener sci- entific research demonstrating a substantial en- ergy savings potential across various industries. 15-metre long dipole magnets create a magnetic field that steers the beam of particles around the LHC ring. Image source: CERN 115 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Good governance Performance-based compensation Appendix DECARBONIZING ENERGY-INTENSIVE INDUSTRIES ABB’s biggest greenhouse gas (GHG) emissions footprint lies in our value chain through indirect emissions, in particular the use of sold products. Reducing our customers’ emissions is therefore particularly important to ABB. As we consider the environmental impacts across our value chain, we aim to help our customers reduce their emissions, especially those in emissions-heavy industries such as metals and mining. Low-carbon society Partnership to support steel industry on its way toward low carbon The steel industry produces one of the most significant materials for engineering and con- struction. As demand for steel grows, the de- carbonization of the industry grows ever more important if we are to accelerate the transition to clean energy. ABB is supporting the steel industry in moving toward lower emissions in- tensities. In partnership with ArcelorMittal, a multinational steel and mining company, ABB is introducing ArcelorMittal’s low-carbon steel in its Kabeldon power distribution systems. The XCarb® steel is made with 100 percent renew- able energy and uses a minimum of 75 percent recycled steel. Through this sourcing agree- ment, ABB is supporting the steel industry’s efforts to become more sustainable while re- ducing the environmental impact of its power distribution systems. By sourcing more sustain- able alternatives for raw materials, the partner- ship contributes to both companies’ efforts to achieve their net-zero targets. This partnership is part of a broader initiative by ArcelorMittal to decarbonize its operations and align with global sustainability goals. 116 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Appendix Good governance Performance-based compensation Low-carbon society Making the first battery-electric trolley truck system for underground mining a reality In the mining sector, ABB has worked with Boliden and Epiroc to deploy the first fully bat- tery-electric trolley truck system on an 800-me- ter-long underground mine test track in Sweden, bringing the industry a step closer to realizing the all-electric mine of the future. The collaboration in Boliden’s Kristineberg mine in northern Sweden marks a critical moment for the industry as it continues to face rising pres- sures to boost essential minerals and metals outputs while reducing carbon intensity and energy usage. By deploying the battery-electric trolley truck system, the collaboration partners aim to demonstrate that the underground work- ing environment can be significantly improved, with fewer emissions, less noise and reduced vibration, all while reducing the total cost per ton. ABB created the infrastructure from grid to wheel, including the electric trolley truck system design and the rectifier substation for the test track. The definition of standards and vehicle interface was jointly developed by the project partners. The eMine™ Trolley System also in- tegrates with the distributed control system ABB Ability™ System 800xA® to monitor the electrical system. As part of the collaboration, Epiroc has added dynamic charging to its battery-electric Mine- truck MT42 SG and battery system, and the trol- ley solution is equipped with ABB’s DC converter, inverters and motors to enhance the power. Boliden intends to implement a full scale, auton- omous electric-trolley system in the Rävliden mine, a satellite orebody and extension of the Kristineberg mine. The total distance will be 5 km at a depth of 750 meters. Once achieved, not only will Rävliden have significantly less carbon emissions compared to a mine using conventional technology, it will also be part of setting a standard for new mines. 117 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Good governance Performance-based compensation Appendix Low-carbon society Leveraging artificial intelligence to optimize ship-port operations While the maritime industry is taking steps to decarbonize operations during vessels’ tran- sit, there are also significant opportunities to reduce the negative environmental impact in ports. One issue that leads to increased emis- sions is a pattern where ships are instructed to proceed without delay to port, only to face a wait upon arrival because the berth is not avail- able. During this wait, they continue using fuel, which generates additional emissions. Despite advancements in smart ship tech- nology and high levels of port automation, the relationships between port and ship sys- tems lack transparency, with data on voyage and berth management often confined to closed platforms. ABB is addressing this challenge in collaboration with optimization platform company Awake.AI and ship management company Wallenius Marine, and as part of the Decarbonization through Digitalization in Shipping (DECARDIS) project, initiated by the European Space Agency. The DECARDIS project aims to develop an inte- grated and interoperable solution to synchro- nize decisions on ship routing and speed with just-in-time arrival at the berth. It seeks to opti- mize an entire voyage and port calls, rather than just a portion of it. Adopted globally, DECARDIS partners estimate that such a solution could help achieve significant emission reductions for the industry. 118 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Appendix Good governance Performance-based compensation PROMOTING PRINCIPLES OF CIRCULARITY Circularity is an approach that would allow us to live more within our planet’s means. Instead of a linear “take-make-waste” model of production and consumption, circularity aims to keep resources in use by “designing out” waste and pollution, keeping products and materials in use and regenerating natural systems. ABB is striving to drive circularity, focusing on preserving resources and reducing environmental impact. Through our products and services, we are supporting process and material modifications that enhance the life span of existing products and emphasize reuse, refurbishment and recycling, instead of relying on new manufacturing. This approach helps conserve valuable raw materials, reduce waste and lower carbon emissions. Low-carbon society Preserving resources Thinking outside the box: driving circularity across the Nordics A key part of ABB’s strategy for promoting circu- larity involves refurbishing electrical equipment, such as transformers and switchgear, extending their life cycle and minimizing the need for new resources. This circular approach reduces the consumption of raw materials and helps com- panies achieve sustainability goals by decreas- ing the amount of waste sent to landfills. ABB partners with businesses to integrate circular principles into their operations, optimizing the efficiency and lifespan of equipment. ABB is leading efforts to drive circularity in the Nordic region. An example of this can be seen in ABB’s partnership with thermoplastic com- pounds provider Polykemi. ABB is integrating Polykemi’s innovative recycled thermoplas- tic compound into the manufacturing of its junction boxes at the Porvoo factory in Finland. Through alternative materials sourcing, it is estimated that the product’s carbon footprint has been reduced by 40 percent throughout the entire life cycle. At the same time, less water is used during production, reducing the product’s overall water intensity. The ABB boxes retain their quality and functionality, even at tempera- tures as low as 25 degrees Celsius below zero. The company is also leveraging digital tech- nologies to improve product performance and maximize energy efficiency, further supporting resource conservation. By adopting these prac- tices, ABB helps industries transition toward a low-carbon economy while reducing their reliance on finite resources and generating economic benefits. 119 Outputs and Outcomes Introduction Value creation Good governance Performance-based compensation Appendix Preserving resources ABB builds a strategic partnership with Sweden’s leading pulp manufacturer to reach new levels of efficiency ABB is also applying its solutions to optimize and reduce resource use in the pulp and paper manufacturing industry by working with one of the world’s leading producers of paper pulp and dissolving pulp, Södra Cell. Södra Cell’s mill bleach plant, located in Värö, Sweden, will work with ABB to implement optimization control with the aim of developing new levels of effi- ciency, engagement and digitalization. The de- livery from ABB includes extended functionality for the ABB Ability™ System 800xA® distributed control system through the implementation of advanced process control (APC) for the bleach- ing process at the mill in Värö. The solution has previously been successfully implemented at Södra Cell’s pulp mill in Mönsterås, Sweden, where digesters and bleach controls have been optimized resulting in improved process sta- bility and reduced resource consumption. The aim is a more stable, optimized bleaching pro- cess with reduced variation of brightness and reduced chemical consumption, as well as im- proved digesting processes. Preserving resources Tackling data center e-waste with robotic microfactories in collaboration with US start-up Molg With global electronic waste (e-waste) pro- jected to rise to 75 million tons by 2030, ABB is supporting the reduction of electronic waste in data centers. As the number of data centers grows, outdated hardware contributes to in- creasing e-waste. In partnership with Molg, a start-up from the United States, ABB is de- veloping robotic microfactories, designed to efficiently disassemble and recycle obsolete electronic components. The robotic microfacto- ries use ABB’s advanced robotics and automa- tion technologies to automate the disassembly process, enabling the recovery and reuse of ma- terials like copper, gold and rare earth metals, minimizing resource depletion. The system is scalable and flexible, enabling data centers to integrate these robotic solu- tions directly into their operations for in-house recycling. This approach not only reduces e-waste but also helps companies recover valu- able materials, thus preserving resources and contributing to a circular economy. 120 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Appendix Good governance Performance-based compensation Low-carbon society Preserving resources Low-carbon zinc Zinc is an important metal for the steel indus- try as it is used to galvanize steel structures, thereby maximizing the operating life. Because metal manufacturing is associated with high emissions, low-carbon alternatives are critical to a fossil-free and circular economy. ABB is using low-carbon zinc in its low-voltage power distribution systems produced by our partner Boliden, a Swedish mining and smelting pioneer. Boliden uses renewable-powered electricity to produce zinc with a carbon footprint that is 75 percent lower than conventional zinc. In turn, Boliden is electrifying its operations with ABB solutions to drive efficiencies across its supply chain and lower its climate impact. ABB’s distri- bution systems galvanized with this low-carbon zinc can also be found in Boliden’s mines where the zinc ore is extracted. Together, both compa- nies are helping to support reduced emissions in the metals industry and make the electrical infrastructure more sustainable. 121 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Good governance Performance-based compensation Appendix LEVERAGING ADVANCED TECHNOLOGIES TO PROMOTE SOCIAL PROGRESS ABB’s technologies promote social progress by supporting people in accomplishing challenging tasks and creating new job opportunities. Our robotics and automation solutions help workplaces reduce time spent on the most challenging elements and streamline their operations, thereby reducing costs and empowering workers. Promoting social progress ABB’s GoFa™ cobots create jobs at sheltered workshop in Belgium ABB’s GoFa cobots are collaborative robots for close and safe collaboration between human and robot. Used at a sheltered workshop by the social enterprise CSTMR, the GoFa cobots are supporting workers with disabilities to perform tasks that would otherwise be difficult for them due to physical or cognitive challenges. The GoFa augments human capabilities, allowing employees to focus on tasks that require cre- ativity and problem solving, while the robots handle routine operations. By handling repeti- tive or physically demanding tasks, the GoFa co- bots empower workers to take on more complex roles that were previously inaccessible. This ini- tiative showcases how automation and robotics can play a key role in social integration, creating new job opportunities and improving the quality of life for people with disabilities. Low-carbon society Preserving resources Promoting social progress ABB Robotics teams with innovative tech start-up to deliver sustainable and affordable housing Our robotics and automation solutions have also been used to make the construction of affordable housing more cost-effective and sustainable. ABB has partnered with AUAR, an innovative technology start-up based in the UK, to reduce key aspects of construction through automation, thereby streamlining the building process and reducing labor costs. ABB robots are used in assembly of modular, prefabricated units, meaning homes can be quickly assem- bled with fewer resources, leading to less ma- terial waste. Simultaneously, ABB is providing solutions that reduce energy demand, inte- grating smart technologies into the housing units so that homeowners are able to optimize power use. 122 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Appendix Good governance Performance-based compensation This collaboration represents a significant step forward in the construction industry’s trans- formation, demonstrating how robotics and sustainable design can be combined to address both housing shortages and environmental challenges. By making affordable housing more accessible and eco-friendly, ABB and AUAR are setting a new standard for sustainable urban development. Promoting social progress NAMTECH and ABB Robotics Sign Memorandum of Understanding to Establish School of Robotics As a leading technology company, ABB under- stands the importance of up-skilling the work- force of tomorrow. ABB is encouraging social progress by fostering education and innovation around robotics. In collaboration with New Age Makers’ Institute of Technology (NAMTECH), ABB will provide programs and resources for individuals and or- ganizations in India to enhance knowledge and skills-building in robotics, automation and dig- ital technologies. NAMTECH and ABB Robotics have signed a Memorandum of Understanding (MoU) to establish a School of Robotics aimed at advancing robotics education and foster- ing innovation in the field. The school will be opened in 2025. The goal is to support the development of a skilled workforce capable of addressing the challenges of the digital era across various sectors, including manufacturing, logistics and healthcare. The school will offer a range of ed- ucational opportunities, including certification courses, hands-on training and advanced robot- ics workshops. These programs are designed to equip students, professionals and businesses with the expertise needed to navigate the grow- ing demand for automation and robotics solu- tions across various industries. 123 ABB INTEGRATED REPORT 2024 Outputs and Outcomes Introduction Value creation Good governance Performance-based compensation Appendix 04 GOOD GOVERNANCE 125 Corporate Governance 128 Board of Directors 129 Executive Committee ABB complies with all relevant frameworks, including the Swiss Code of Obligations, the Swiss Code of Best Practice for Corporate Governance and the rules of the capital markets where its shares are listed. Governance princi- ples are also anchored in various ABB corporate documents, such as its Articles of Incorporation, its Board Governance Rules and its policies and procedures. Strong corporate governance is not only neces- sary to ensure compliance with applicable legal requirements but is indispensable for creating sustainable value. We are convinced that our established governance culture helps ABB suc- cessfully manage its business and realize oppor- tunities for the benefit of all of its stakeholders. The foregoing also applies to sustainability. ABB has a robust sustainability governance structure from its Board of Directors through to its operating divisions. Our Board of Directors reviews and approves the Sustainability Agenda and related targets. The ABB Group Executive Committee validates the Sustainability Agenda, is responsible for its implementation and ensures that a sustainability culture 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 the ABB Way and our decentralized oper- ating model, our four business areas and their divisions are ultimately accountable for putting action plans in place and ensuring that appro- priate resources are available to implement these plans and deliver on our targets. Corporate Governance ABB is committed to the highest international standards of corporate governance. This is reinforced in its structure, pro- cesses and rules, as outlined in more detail in ABB’s Corporate Governance Report. → More information about our sustainabil- ity governance struc- ture can be found in our Sustainability Statement 2024. ABB GOVERNANCE STRUCTURE BOARD OF DIRECTORS EXECUTIVE COMMITTEE Governance and Nomination Committee Compensation Committee Finance, Audit and Compliance Committee 125 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance 126 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance OUR BOARD MEMBERS (AS OF DECEMBER 31, 2024) 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 Lars Förberg • Member of ABB’s Board of Directors since 2017 • Member of the Governance and Nomination Committee • Swedish and Swiss 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 Jennifer Xin-Zhe Li • Member of ABB’s Board of Directors since 2018 • Member of the Governance and Nomination Committee and Compensation Committee • Canadian citizen Geraldine Matchett • Member of ABB’s Board of Directors since 2018 • Member of the Finance, Audit and Compliance 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 Mats Rahmström • Member of ABB’s Board of Directors since 2024 • Member of the Finance, Audit and Compliance Committee • Swedish citizen 127 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance While the Board takes decisions as a whole, its three committees – the Finance, Audit and Compliance Committee, the Governance and Nomination Committee and the Compensation Committee – support it with high-level ex- pertise and by ensuring an efficient mode of operation. Special attention is paid to sustain- ability aspects: 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 com- pany’s sustainability-related reporting; and the Compensation Committee ensures that ABB’s executive compensation policies are appro- priately aligned to its Sustainability Agenda. Ultimate responsibility for ABB’s Sustainability Agenda, its sustainability targets and its annual Sustainability Statement lies with the entire Board of Directors. MEMBERS OF THE BOARD (2024–2025 BOARD TERM) Board experience Corporate officer experience Other business experience Board member ABB Board tenure (years) Other public board experience CEO CFO Operations Risk management Sustainability 1 Digital/ technology Global experience Country of origin/ nationality Gender Non-executive Independent Peter Voser 10 • • • • • • • • CH M Yes Yes David Constable 10 • • • • • • CA, US M Yes Yes Frederico Curado 9 • • • • • • • BR, PT M Yes Yes Lars Förberg 8 • • • • • SE, CH M Yes Yes Johan Forssell 1 • • • • • • • SE M Yes Yes Denise Johnson 2 • • • • • • US F Yes Yes Jennifer Xin-Zhe Li 7 • • • • • • • CN, CA F Yes Yes Geraldine Matchett 7 • • • • • • CH, UK, FR F Yes Yes David Meline 9 • • • • • • US, CH M Yes Yes Mats Rahmström 1 • • • • • • • SE M Yes Yes 1. For detailed information about sustainability experience see Sustainability Statement 2024. Board of Directors ABB’s Board of Directors is responsible for the strategy of the com- pany. It is a truly diverse board: all members represent a broad vari- ety of geographical, business, management and cultural experience. With the latest elections at ABB’s Annual General Meeting 2024, the entire Board of Directors has been renewed within the past 10 years. 128 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance In line with the Board’s leading example, ABB strives to have an equally diverse Executive Committee in all aspects, not only in business and management experience, but also when it comes to geographical and cultural backgrounds. Executive Committee Each member of the Executive Committee is appointed by the Board of Directors. The Board has delegated the executive manage- ment of ABB to the CEO, who – together with the other members of the Executive Committee – is responsible for the company’s operational business. 129 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance OUR EXECUTIVE COMMITTEE MEMBERS (AS OF DECEMBER 31, 2024) Sami Atiya • President of the 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 Brandon Spencer • President of the Motion business area since 2024 • US citizen Carolina Granat • Chief Human Resources Officer since 2021 • Swedish citizen Mathias Gaertner • General Counsel and Secretary to the Board of Directors since 2024 • German citizen 130 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance Giampiero Frisio • President of the Electrification business area since 2024 • Italian citizen Timo Ihamuotila • Chief Financial Officer since 2017 • Finnish citizen Karin Lepasoon • Chief Communications and Sustainability Officer since 2022 • Swedish citizen Peter Terwiesch • President of the Process Automation business area since 2015 • German and Swiss citizen 131 Introduction Value creation Outputs and Outcomes Performance-based compensation Appendix Good governance 133 Extracts from Compensation Committee Chair Letter 135 Board compensation 136 Executive Committee compensation 140 Sustainability-related considerations in ABB’s compensation PERFORMANCE- BASED COMPENSATION 05 Extracts from Compensation Committee Chair Letter Our focus at the Compensation Committee is to ensure that the compensation structure at ABB drives value creation for our shareholders, represents a motivating package for our executives, and ensures alignment with market best-practices and with our Sustainability Agenda. SUMMARY OF PLANNED CHANGES IN POLICIES AND DISCLOSURES In the spirit of continuous improvement and considering stakeholder feedback, we plan to make a couple of enhancements to our Annual Incentive Plan (AIP), applicable from 2025. Currently, the total weighting associated with Group and business area financial measures represents 80 percent of Executive Committee (EC) member’s target AIP award, with the re- maining 20 percent attributed to the individual measure, which contains a combination of sustainability, operational and strategic goals. From 2025, we will increase the weighting of the financial measures from 80 percent to 90 per- cent and replace the individual measure with two mandatory sustainability goals, with a com- bined weighting of 10 percent. We believe the increased focus on the finan- cial business measures will help reinforce our continued drive to achieve our ambitious financial targets. Furthermore, we think that having two clearly measurable sustainability goals in the AIP will strengthen and support ABB’s commitment to sustainability and complement the sustainabil- ity measure in our Long-Term Incentive Plan (LTIP), which has a material weighting of 20 per- cent of the target award. Details related to the sustainability target for the 2025 LTIP are dis- closed in the Compensation Report 2024. 2024 RESULTS AND COMPENSATION POLICY OUTCOMES 2024 was a year of strong operational and financial performance. Overall, most key fi- nancial, sustainability and operational targets were met or exceeded. ABB (the company) delivered new highs for operational EBITA mar- gin and revenues in 2024. The company also progressed on orders and continued to make significant progress in reducing its environ- mental footprint and contributing to a more sustainable environment. Board of Directors (Board) The total Board compensation for the 2024–2025 term (CHF 4.25 million) is within the maximum amount (CHF 4.4 million) approved at the Annual General Meeting (AGM) 2024. There has been no change to the individual Board member fees since 2015. Executive Committee (EC) No EC members in place at the time of ABB’s annual salary review received a salary adjust- ment in March 2024. The average award for EC members under the AIP for 2024 in their year- end roles was 119 percent (out of a maximum of 150 percent), compared to 143.3 percent in 2023. The achievement level of the 2021 LTIP, which vested in 2024, was 200 percent (out of a maximum of 200 percent), driven by strong evo- lution of ABB’s Earnings Per Share (EPS) during the period and ABB’s vigorous relative Total Shareholder Return (TSR). The total EC compensation was CHF 44.5 million in 2024, driven by the strong performance-re- lated variable pay awards and the appointment → For more information on ABB’s 2024 sustain- ability achievements please refer to sections Outputs and Outcomes of this Report. 133 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation of new EC members during the 2024 financial year, including the provision of a replacement share grant for an external hire. This amount was slightly higher than the CHF 43.9 million approved at the Annual General Meeting 2023 for the financial year 2024 due to the impact of the appointment of new members of the Executive Committee during 2024. To cover this additional compensation, the com- pany used the supplementary amount provided for this purpose, in accordance with Art. 35 of the Articles of Incorporation (equivalent to 30 percent of the amount approved at the AGM 2023), whereby the compensation granted was significantly below the maximum amount of CHF 57.1 million. GOVERNANCE At the AGM on March 27, 2025, shareholders will be asked to vote on the maximum aggregate compensation for the Board for its 2025–2026 term and on the maximum aggregate compen- sation for the EC in 2026. The former is again unchanged compared to the prior year, while the latter shows a decrease from the level requested for the prior year, primarily influenced by the change in composition of the EC. ABB’s Compensation Report 2024 will also be submitted for a non-binding, consultative vote by shareholders. We have pursued an open and regular dialogue with our stakeholders, as we continue to im- prove our compensation system. On behalf of the Compensation Committee, I thank all share- holders for their continued trust in ABB and for their consistently supportive feedback. Frederico Fleury Curado Chairman of the Compensation Committee Zurich, February 26, 2025 134 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation Board compensation Compensation for the 2024–2025 term of office The total Board compensation for the 2024–2025 term of office (CHF 4,250,000) was within the maximum amount (CHF 4,400,000) approved at the Annual General Meeting (AGM) 2024. There has been no change to the individual Board fees since 2015. In Exhibit 1 we set out the fees by member for the 2024–2025 Board term. EXHIBIT 1 Board fees for the 2024–2025 term of office (in CHF) by member Name Board Compensation Committee Finance, Audit and Compliance Committee Governance and Nomination Committee Total Compensation Peter Voser 1 1,200,000 – – – 1,200,000 David Constable 2 290,000 30,000 – – 320,000 Frederico Curado 3 290,000 60,000 – – 350,000 Lars Förberg 2 290,000 – – 30,000 320,000 Johan Forssell 2 290,000 – – 30,000 320,000 Denise Johnson 2 290,000 – 40,000 – 330,000 Jennifer Xin–Zhe Li 2 290,000 30,000 – 30,000 350,000 Geraldine Matchett 2 290,000 – 40,000 – 330,000 David Meline 3 290,000 – 110,000 – 400,000 Mats Rahmström 2 290,000 – 40,000 – 330,000 Total 4,250,000 1. Chairman of the Board, who does not receive any additional committee fee as Chairman of the Governance and Nomination Committee. 2. Member of a Committee. 3. Chairman of a Committee. 135 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation Executive Committee compensation Compensation structure during 2024 We summarize the elements of the EC members’ compensation structure, including the purpose, the link to strategy and applicable performance indicators as shown in Exhibit 2. EXHIBIT 2 EC compensation structure during 2024 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 re- tention of talented EC mem- bers; base salary compen- sates for the role and relevant experience; bene- fits protect against risk Rewards annual company, business area, functional and individual performance. 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 perfor- mance 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 provi- sions 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% CEO Minimum Target Maximum 0% 150% 300% Other EC members 1 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 CEO and corporate officers 80% Group financial results 20% Individual results 20% Group financial results 60% Business area financial results 20% Individual results Business area Presidents All EC members 50% Average EPS 30% Relative TSR 20% Sustainability Exposure to ABB share price 1. EC members with legacy employment contracts have a Target LTIP grant of 100 percent and Maximum LTIP opportunity of 200 percent. The higher LTIP opportunity for the newer EC members is largely offset by lower pension and other benefit costs. 136 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation Total EC compensation for 2024 The total EC compensation was CHF 44.5 million in 2024, driven by the strong performance-re- lated variable pay awards and the change in composition of the EC, including the provision of a replacement share grant for an external hire. This amount was slightly higher than the CHF 43.9 million approved at the AGM 2023 for the financial year 2024, due to the impact of the appointment of new EC members during 2024. To cover this additional compensation, the com- pany used the supplementary amount provided for this purpose, in accordance with Art. 35 of the Articles of Incorporation (30 percent of the amount approved at the AGM 2023), whereby the compensation granted was significantly be- low the maximum amount CHF 57.1 million. The largest portion of the CEO’s 2024 total compensation was delivered via performance driven variable compensation (66 percent), represented by short-term and long-term in- centives. The compensation for Morten Wierod in his former role as business area president Electrification (until July 31, 2024) is included under the CEO compensation. For the other EC members, on an aggregate level, variable compensation represented 64 percent of their 2024 compensation. Exhibit 3 shows the composition of the 2024 total compensation for the EC members at December 31, 2024, without the 2024 compensation for former EC members. 1. Composed of 2024 base salary, 2024 AIP, 2024 LTIP grant, pen- sion benefits, and other benefits. A replacement share grant for the General Counsel and Company Secretary is included in the category Long-term incentive. 2024 AIP represents ac- crued short-term incen- tive for the year 2024, which will be paid in 2025, after the publica- tion of ABB’s financial results. The sum of per- centage figures may differ from 100 percent due to rounding to one decimal place. Realized variable compensation in 2024 Realized variable compensation relates to the AIP award and the LTIP award at the end of their respective performance cycles, reflect- ing accrued AIP payment and LTIP vesting, based on achievement of the respective plan performance measures. The outcome of the 2024 AIP (Exhibit 4) was above the target for EC members in their year- end roles (119 percent on average), and the LTIP that vested in 2024 (2021 LTIP) exceeded the tar- get level, with a final vesting level of 200 percent of target (Exhibit 5). EXHIBIT 3 2024 total compensation mix (in CHF) for the CEO and other EC members on aggregate level ¹ 18.0% Base salary 6.1% Pension benefits 10.2% Other benefits 22.9% Short-term incentive 42.7% Long-term incentive Variable compensation 66% Fixed compensation 34% 6,619,005 16.8% Base salary 8.1% Pension benefits 10.8% Other benefits 19.5% Short-term incentive 44.7% Long-term incentive Variable compensation 64% Fixed compensation 36% 27,912,581 CEO OTHER EC MEMBERS 137 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation Realized total compensation in 2024 Considering the variable components stated above, the realized total compensation in 2024 was above the target for all EC members, driven by strong performance and the high level of achievement against the targets for the 2021 LTIP, which vested in 2024. Further details related to the realized com- pensation of each EC member and each com- pensation component are specified in our Compensation Report 2024. → Target AIP award corre- sponds to 100 percent of base salary. 1. The AIP outcome for Morten Wierod relates solely to his role as CEO (from August 1, 2024). 2. On an aggregate level, while individual out- comes range from 57 to 135 percent. 0% 25% 50% 75% 100% 125% 150% 175% 200% EXHIBIT 5 2021 LTIP outcome compared to target Target achievement level Realized achievement level Maximum achievement level Relative TSR (50% of total) Average EPS (50% of total) LTIP vesting (total) 100% 100% 100% 200.0% 200.0% 200.0% 200% 200% 200% CEO¹ Other EC members² EXHIBIT 4  ŵŽƄ ƝƣƢƑƝƛƓ ƑƝƛƞƏƠƓƒ ƢƝ ƢƏƠƕƓƢ 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 121% 119% 150% 150% Target AIP award Realized AIP award Maximum AIP award 138 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation 1. On an aggregate level, while individual out- comes range from 109 to 163 percent. Share ownership of EC members An alignment of our EC members’ personal wealth at risk to the ABB share price and their in- terests with those of shareholders is important 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 the required share ownership level. Four out of nine EC members exceeded their share ownership requirements. The other five members have been appointed to the EC in the last three years. When considering the number of granted, but unvested, ABB shares of EC members at December 31, 2024, it is expected that four re- cently appointed EC members who do not cur- rently meet their share ownership requirement are projected to do so by 2027, after vesting of their respective LTIP share grants or replace- ment share grants. 1. Based on share price of CHF 37.81, the 2024 LTIP reference price, and shares held at December 31, 2024. Future allocation of granted, but unvested, shares is based on tar- get achievement level and relevant plan spe- cific settlement: default settlement of the final 2022 LTIP, 2023 LTIP and 2024 LTIP, and replace- ment share awards is 100 percent in shares. The value of shares is compared against the annual base sal- ary net of taxes, at December 31, 2024. CEO Other EC members¹ EXHIBIT 6 Realized total compensation in 2024 compared to target total compensation 0 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 35,000,000 CHF 4,238,359 CHF 17,899,073 156% CHF 6,594,291 150% CHF 26,888,036 Target total compensation Realized total compensation EXHIBIT 7 EC shareholding compared to share ownership guideline¹ CEO share ownership requirement (500%) EC appointment Held shares in % of net salary Granted, but unvested shares Share ownership requirement 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% 200% 400% 600% 800% 1000% 1200% Other EC members share ownership requirement (400%) 139 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation Impact of sustainability performance on vari- able compensation Given sustainability is an integral part of ABB’s strategy and plans, we incorporate a strong, di- rect link between our Sustainability Agenda and executive incentives through our key variable compensation programs such as AIP and LTIP. Regarding the AIP for 2024, all EC members had three sustainability goals (out of a maximum of three) in the individual component of their re- spective plans. In 2024, all EC members had an environmen- tal goal (scope 1 and 2 greenhouse gas (GHG) emissions). Most of the EC members had a so- cial goal, which for the CEO and business area presidents was safety, and for most corporate officers was an increase in the proportion of women in senior management roles (female leaders), while the CFO had a governance goal related to internal controls. In addition, all EC members had a governance goal designed to help deliver ABB’s obligations under the Deferred Prosecution Agreement (DPA) in line with our commitments to the US Department of Justice. From 2025, we will replace the individual mea- sure under the AIP with two mandatory sus- tainability goals, with a combined weighting of 10 percent. Regarding the LTIP granted to ABB’s execu- tives in 2024, including the EC, we continued to carry a company-wide sustainability perfor- mance measure in the LTIP with a weighting of 20 percent. For the 2024 LTIP, our sustainability perfor- mance measure was the Company’s scope 1 and 2 GHG emissions reduction at the end of the three-year performance period (2024–2026), compared to the 2019 baseline. The sustainability measure applied to the 2025 LTIP is the same as that applied to the 2023 and 2024 LTIP, namely scope 1 and 2 GHG emissions reduction at the end of a three-year perfor- mance period. The 2025 LTIP targets will be based on scope 1 and 2 GHG emissions reduc- tion over the three-year performance period from 2025–2027, compared to a baseline of the 2024 total scope 1 and 2 GHG emissions. We will consider the appropriateness of the sustainability measure for future LTIPs, given the fact that, by the end of the 2025 LTIP cycle (i.e., end of 2027) ABB will have broadly achieved its scope 1 and 2 emissions reduction goals. This activity will be part an LTIP design review which the Compensation Committee will un- dertake during 2025 and will inform LTIP grants from 2026. Details of the long-term GHG emissions reduc- tion targets can be found in our Sustainability Statement 2024. Sustainability-related considerations in ABB’s compensation There are a range of sustainability-related considerations which play an important role in our compensation philosophy, including the de- sire to foster a strong link between ABB’s Sustainability Agenda and the variable compensation for the EC and other executives, as well as the general ambition to reinforce the Company’s social contract with its employees. 140 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation 141 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Appendix Performance-based compensation 06 APPENDIX 143 Alternative performance measures 146 Key terms 148 Financial calendar 2025 Alternative performance measures The following are definitions of key financial measures used to evaluate ABB’s operating performance. These financial measures are re- ferred to in this Integrated Report and are not defined under United States generally accepted accounting principles (US GAAP). While ABB’s management believes that the alter- native performance measures herein are useful in evaluating ABB’s operating results, this infor- mation should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with US GAAP. COMPARABLE GROWTH RATES Growth rates for certain key figures may be pre- sented and discussed on a “comparable” basis. The comparable growth rate measures growth on a constant currency basis. Since we are a global company, the comparability of our oper- ating results reported in US dollars is affected by foreign currency exchange rate fluctuations. We calculate the impacts from foreign currency fluctuations by translating the current-year peri- ods’ reported key figures into US dollar amounts using the exchange rates in effect for the com- parable periods in the previous year. Comparable growth rates are also adjusted for changes in our business portfolio. Adjustments to our business portfolio occur due to acqui- sitions, divestments, or by exiting specific business activities or customer markets. The adjustment for portfolio changes is calculated as follows: where the results of any business acquired or divested have not been consol- idated and reported for the entire duration of both the current and comparable periods, the reported key figures of such business are adjusted to exclude the relevant key figures of any corresponding quarters which are not comparable when computing the comparable growth rate. Certain portfolio changes which do not qualify as divestments under US GAAP have been treated in a similar manner to divest- ments. Changes in our portfolio where we have exited certain business activities or customer markets are adjusted as if the relevant business was divested in the period when the decision to cease business activities was taken. We do not adjust for portfolio changes where the relevant business has annualized revenues of less than $50 million. OPERATIONAL EBITA MARGIN Operational EBITA margin Operational EBITA margin is operational EBITA as a percentage of operational revenues. Operational EBITA Operational earnings before interest, taxes and acquisition-related amortization (op- erational EBITA) represents income from operations excluding: • acquisition-related amortization (as defined below), • restructuring, related and implementation costs (as defined below), • changes in the amount recorded for obliga- tions related to divested businesses occur- ring after the divestment date (changes in obligations related to divested businesses), • gains and losses from sale of businesses (in- cluding fair value adjustment on assets and liabilities held for sale, if any), • acquisition- and divestment-related expenses and integration costs, • certain other non-operational items, as well as • foreign exchange/commodity timing differ- ences in income from operations consisting of: (a) unrealized gains and losses on deriv- atives (foreign exchange, commodities, em- bedded derivatives), (b) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (c) unrealized foreign exchange move- ments on receivables/ payables (and related assets/liabilities). → For a full reconcilia- tion of ABB’s alter- native performance measures, please re- fer to Supplemental Reconciliations and Definitions, in the ABB Q4 2024 Financial Information on https://global.abb/ group/en/investors/ quarterly-results 143 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Certain other non-operational items generally includes: certain regulatory, compliance and legal costs, certain asset write downs/impair- ments and certain other fair value changes, as well as other items which are determined by management on a case-by-case basis. Operational EBITA is our measure of segment profit but is also used by management to evalu- ate the profitability of the company as a whole. Acquisition-related amortization Amortization expense on intangibles arising upon acquisitions. Restructuring, related and implementation costs consists of restructuring and other re- lated expenses, as well as internal and external costs relating to the implementation of Group- wide restructuring programs. Operational revenues We present operational revenues solely for the purpose of allowing the computation of the operational EBITA margin. Operational reve- nues are total revenues adjusted for foreign exchange/commodity timing differences in total revenues of: (i) unrealized gains and losses on derivatives, (ii) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (iii) unrealized foreign exchange movements on receivables (and related assets). Operational revenues are not intended to be an alternative measure to total revenues, which represent our revenues measured in accordance with US GAAP. NET WORKING CAPITAL AS A PERCENTAGE OF REVENUES Net working capital as a percentage of reve- nues is calculated as net working capital divided by adjusted revenues for the trailing 12 months. Net working capital is the sum of (i) receiv- ables, net, (ii) contract assets, (iii) inventories, net, and (iv) prepaid expenses; less (v) accounts payable, trade, (vi) contract liabilities and (vii) other current liabilities (excluding primarily: (a) income taxes payable, (b) current deriva- tive liabilities, (c) pension and other employee benefits, (d) payables under the share buyback program, (e) liabilities related to certain other restructuring-related activities; and including the amounts related to these accounts which have been presented as either assets or liabili- ties held for sale. Adjusted revenues for the trailing 12 months includes total revenues recorded by ABB in the 12 months preceding the relevant balance sheet date adjusted to eliminate revenues of divested businesses and the estimated impact of annualizing revenues of certain acquisitions which were completed in the same trailing 12-month period. FREE CASH FLOW CONVERSION TO NET INCOME Free cash flow conversion to net income is cal- culated as free cash flow divided by adjusted net income attributable to ABB. Adjusted net income attributable to ABB is calculated as net income attributable to ABB adjusted for: gains and losses arising on the sale of certain businesses and certain other significant items within net income which are also excluded / adjusted for when calculating operating cashflows. Free cash flow is calculated as net cash pro- vided by operating activities adjusted for: (i) purchases of property, plant and equipment and intangible assets, and (ii) proceeds from sales of property, plant and equipment. RETURN ON CAPITAL EMPLOYED Return on capital employed (ROCE) is calcu- lated as operational EBITA after tax, divided by the average of the period’s opening and closing capital employed, adjusted to reflect impacts from the timing of significant acquisitions/di- vestments occurring during the period. Capital employed is calculated as the sum of ad- justed total fixed assets and net working capital (as defined above). Adjusted total fixed assets is the sum of (i) property, plant and equipment, net, (ii) goodwill, (iii) other intangible assets, net, (iv) investments in equity-accounted companies, and (v) operating lease right of-use assets, less (vi) deferred tax liabilities recognized in certain acquisitions. Notional tax on operational EBITA is computed using an adjusted group effective tax rate multi- plied by operational EBITA. 144 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Adjusted Group effective tax rate is computed by dividing an adjusted income tax expense by an adjusted pretax income. Certain amounts recorded in income before taxes and the related income tax expense (primarily due to gains and losses from sale of businesses and in 2022, regulatory penalties in connection with the Kusile project) are removed from the reported amounts when computing these adjusted amounts. Certain other amounts recorded in income tax expense are also excluded from the computation to determine the adjusted Group effective tax rate. NET DEBT Net debt is defined as total debt less cash and marketable securities. Total debt is the sum of short-term debt and current maturities of long-term debt, and long-term debt. Cash and marketable securities is the sum of cash and equivalents, restricted cash (current and non-current) and marketable securities and short-term investments. NET DEBT/EBITDA RATIO Net debt/EBITDA ratio is defined as net debt (as defined above) divided by EBITDA. EBITDA is defined as income from operations for the trailing 12 months preceding the balance sheet date before depreciation and amortiza- tion for the same trailing 12-month period. NET FINANCE EXPENSES Net finance expenses is calculated as interest and dividend income less interest and other finance expense. BOOK-TO-BILL RATIO Book-to-bill ratio is calculated as orders re- ceived divided by total revenues. 145 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Key terms A ABB Way The ABB Way is the common operat- ing model for our divisions, business areas and lean corporate center. It de- fines “how” we create value. It is built around our purpose and consists of four elements: business model, gov- ernance, people & culture and brand. B Business areas ABB has a decentralized business model with 19 divisions grouped into four business areas: Electrification, Motion, Process Automation, and Robotics & Discrete Automation. They complement each other, cooperate and find synergies to create com- petitive advantages and best serve our customers. C Circular economy In contrast to a linear “take-make- waste” model of production and consumption, the circular economy aims to keep resources in use by designing products for durability, reusability and recyclability. At ABB, circular economy approaches are at the center of the second pillar of our Sustainability Agenda, “preserving resources”. By 2030, we aim to have at least 80 percent of ABB’s prod- ucts and solutions covered by our Circularity Approach and evaluated against a clear set of key performance indicators (KPIs), corresponding to each stage of the product lifecycle. D Divisions Our 19 divisions represent the highest level of operating decisions within ABB with full ownership and account- ability for their respective strategies, performance and resources, as they are closest to our markets and cus- tomers. They are grouped into four business areas. E ‘Engineered to Outrun’ In 2024, ABB launched its tagline ‘Engineered to Outrun’ under the new brand positioning “We help industries outrun – leaner and cleaner”. It means keeping ABB’s partners running at high performance while helping them run more productively, efficiently and sus- tainably so they can outperform. This supports ABB’s purpose of enabling a more sustainable and resource-effi- cient future with its technology leader- ship in electrification and automation. G Greenhouse gas emissions Greenhouse gas (GHG) emissions refer to all emissions that have a warming effect on the earth’s surface by trapping heat in the atmosphere. The Greenhouse Gas Protocol, which sets global standards to measure and manage GHG emissions, covers seven GHGs: carbon dioxide (CO 2 ), methane (CH 4 ), nitrous oxide (N 2 O), as well as gases used in industry, including hydrofluorocarbons (HFCs), per-fluo- rocarbons (PCFs), sulfur hexafluoride (SF 6 ). and nitrogen trifluoride (NF 3 ). CO 2 , CH 4 , and N 2 O are released during the combustion of fossil fuels, such as coal, oil, or natural gas. At ABB, we use the metric ton of CO 2 - equivalent (CO 2 e) to calculate our GHG emissions and to measure progress toward our emissions reduction targets. H Headcount vs. FTE Headcount and FTE (full-time equiv- alent) are both methods that are used to count members within an organization. The key difference is that headcount represents the total number of employees that are work- ing at an organization at any given time, regardless of their work status being full-time or part-time. It is mainly used in social reporting. While FTE is a metric that is notably used in financial reporting to calculate the total number of full-time hours being collectively worked across an orga- nization, this way making employed persons comparable although they may work a different number of hours per week. For example, if an organi- zation considers 40 hours per week as full-time, a part-time worker em- ployed for 20 hours a week, is counted as 0.5 FTE or as 1 headcount. M Materiality Materiality refers to the process of determining material information with regard to sustainability to be managed and included in reporting. For the fiscal year 2024, ABB con- ducted a double materiality (impact materiality and financial materiality combined) assessment aligned with the ESRS requirements. 146 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix N Net zero versus carbon neutral “Net zero” means that any GHG released into the atmosphere is balanced by an equivalent amount being removed. “Carbon neutral” means that carbon emissions can be offset by a reduction in emissions or a removal of carbon from the atmo- sphere, for instance through carbon sinks, which absorb more carbon than they emit. At ABB, we have es- tablished net-zero targets. By 2050, ABB targets reducing absolute scope 1 and 2 emissions by 100 percent, and scope 3 emissions by 90 percent. P Purpose ABB’s purpose is to enable a more sustainable and resource-efficient fu- ture with our technology leadership in electrification and automation. This is why we are in business and is the guiding star for ABB’s direction and strategy. Our purpose is based on five themes: creating success for all our stakeholders, addressing the world’s energy challenges, transforming industries, embedding sustainabil- ity in everything we do, and leading with technology. S Science-based targets Greenhouse gas reduction targets, set by companies, that are in line with what the latest climate science (as per SBTi) deems necessary to meet the goals of the Paris Agreement, which aims to limit “the increase in the aver- age global temperature to well below 2°C above pre-industrial levels” and “pursue efforts to limit the tempera- ture increase to 1.5°C.” Scope 1 GHG emissions Direct emissions from compa- ny-owned and controlled resources, for example, emissions from combus- tion in owned or controlled boilers, furnaces, vehicles. Scope 2 GHG emissions Indirect emissions from the gen- eration of purchased energy (elec- tricity, steam, heat, cooling) from a utility provider. Scope 3 GHG emissions All other indirect emissions that are not included in scope 2, occurring in both the upstream and downstream value chain. According to the GHG Protocol, scope 3 emissions are sepa- rated into 15 categories, and include, for example, purchased goods and services, business travel and com- muting, or use of sold products. Sustainability Sustainability or sustainable devel- opment can be defined as “meeting the needs of the present without compromising the ability of future generations to meet their own needs” (Brundtland Report, 1987). Sustainability is commonly based on three dimensions: economic sustain- ability, environmental sustainability and social sustainability. At ABB, we strive to embed sustainability in everything we do. Sustainability is core to our company’s purpose, strategic direction, operating model (the ABB Way), objectives, and is a key part of the value that we create for our stakeholders. Sustainability Agenda In 2020, ABB defined a clear approach to contribute to a more sustain- able society. The three pillars of our Sustainability Agenda are “enabling a low-carbon society”, “preserving re- sources” and “promoting social prog- ress”, sustained by the foundation of “embedding a culture of integrity and transparency along the extended value chain”. V Value creation The process that results in increases, decreases or transformations of inputs and related outputs and outcomes caused by our business activities in the-, medium- and long- term. We not only focus on maxi- mizing shareholder value but work holistically to create financial and sustainability-linked value for all our stakeholders, for ABB, society and the environment. We are convinced that this is not only the right thing to do, but also in the interest of our long- term business success. 147 ABB INTEGRATED REPORT 2024 Introduction Value creation Outputs and Outcomes Good governance Performance-based compensation Appendix Financial calendar 2025 March 27, 2025 Annual General Meeting April 17, 2025 Q1 2025 results July 17, 2025 Q2 2025 results October 16, 2025 Q3 2025 results January 29, 2026 Q4 and FY 2025 results TAKE THE SURVEY We at ABB will appreciate your feedback on the Integrated Report. This survey takes just two minutes to complete. By giving us your feedback, we can actively work to continuously improve our reporting. Caution concerning forward-looking statements The Integrated Report 2024 includes forward-looking statements and information that are based largely on current expectations, esti- mates 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,” “con- tinue,” “target,” “anticipate,” “intend,” “expect,” “plan” and similar words and the express or implied discussion of strategy, plans or in- tentions are intended to identify forward-looking statements. These forward- looking statements are subject to risks, uncertainties and assumptions, including, among other things, the following: (i) busi- ness risks related to the global volatile 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 competition and changes in economic and market conditions in the product markets and geographic areas in which we operate; (v) effects of, and changes in, laws, regulations, governmental policies, taxation, or accounting standards and prac- tices and (vi) other factors described in in our public disclosures, in- cluding 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 as- sumptions, we can give no assurance that they will be achieved. We undertake no obligation to update publicly or revise any for- ward-looking statements because of new information, future events or otherwise. In light of these risks and uncertainties, the for- ward-looking information, events and circumstances might not oc- cur. Our actual results and performance could differ substantially from those anticipated in our forward-looking statements. © Copyright 2025 ABB. All rights reserved. ABB Ltd Corporate Communications Affolternstrasse 44 8050 Zurich Switzerland Tel: +41 (0)43 317 71 11 www.abb.com 01 Financial review of ABB Group 01 02 Consolidated Financial Statements 54 03 ABB Ltd Statutory Financial Statements 127 2 Operating and financial review and prospects 2 FINANCIAL REPORT 2024 — INTRODUCTION ABOUT ABB 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’. Our company has over 140 years of history and around 110,000 employees worldwide. We operate in approximately 100 countries across three regions: Europe, the Americas, and Asia, Middle East and Africa, and generate revenues in numerous currencies. We are headquartered in Zurich, Switzerland, and we govern our company through our four Business areas: Electrification, Motion, Process Automation, and Robotics & Discrete Automation. For a breakdown of our consolidated revenues (i) by Business area, (ii) by geographic region, and (iii) by product type, see “Analysis of results of operations—Revenues” and “Note 24 - Operating segment and geographic data” to our Consolidated Financial Statements. — EMPLOYEES A breakdown of our employees by geographic region is as follows: December 31, 2024 2023 2022 Europe 52,100 51,400 49,700 The Americas 26,800 26,400 26,400 Asia, Middle East and Africa 31,000 30,100 29,000 Total 109,900 107,900 105,100 — HISTORY OF THE ABB GROUP The ABB Group was formed in 1988 through a merger between Asea AB and BBC Brown Boveri AG. Initially founded in 1883, Asea AB was a major participant in the introduction of electricity into Swedish homes and businesses and in the development of Sweden’s railway network. In the 1940s and 1950s, Asea AB expanded into the power, mining and steel industries. Brown Boveri and Cie. (later renamed BBC Brown Boveri AG) was formed in Switzerland in 1891 and initially specialized in power generation and turbines. In the early to mid ‑ 1900s, it expanded its operations throughout Europe and broadened its business operations to include a wide range of electrical engineering activities. FINANCIAL REPORT 2024 3 In January 1988, Asea AB and BBC Brown Boveri AG each contributed almost all of their businesses to the newly formed ABB Asea Brown Boveri Ltd, of which they each owned 50 percent. In 1996, Asea AB was renamed ABB AB and BBC Brown Boveri AG was renamed ABB AG. In February 1999, the ABB Group announced a group reconfiguration designed to establish a single parent holding company and a single class of shares. ABB Ltd was incorporated on March 5, 1999, under the laws of Switzerland. In June 1999, ABB Ltd became the holding company for the entire ABB Group. This was accomplished by having ABB Ltd issue shares to the shareholders of ABB AG and ABB AB, the two companies that formerly owned the ABB Group. The ABB Ltd shares were exchanged for the shares of those two companies, which, as a result of the share exchange and certain related transactions, became wholly ‑ owned subsidiaries of ABB Ltd. ABB Ltd shares are currently traded on the SIX Swiss Exchange and the NASDAQ OMX Stockholm Exchange, and the sponsored level I American Depositary Shares (ADS) are traded on the over-the-counter (OTC) markets under the ticker ABBNY. ABB filed a Form 15F to voluntarily deregister and suspend SEC reporting on June 10, 2024. The deregistration became effective in September 2024. We continue to meet financial reporting requirements as per the regulations of the SIX Swiss Exchange and Nasdaq Stockholm. — ABB TODAY The ABB Purpose ABB's purpose is to enable a more sustainable and resource-efficient future with our technology leadership in electrification and automation. Our offering is relevant for the global transition towards low-carbon energy, increased energy efficiency, and the transition to more adaptive manufacturing and automation, putting us right in the center of long-term secular trends. Market leading technology Our market-leading position is based on cutting-edge technology including value derived from software, our ability to scale, decades-long domain expertise and close customer relationships, all of which act as barriers to market entry for potential competitors. We continuously evolve our offering to remain a relevant and trusted partner to our customers. Our annual non- order related research and development spending in 2024 amounted to approximately 4.5 percent of revenues. We focus our research and development expenditures on key areas of innovation and have spent approximately $10.6 billion since the beginning of 2016, focusing on developing best-in-class products and services in the fields of electrification and automation with the goal of helping our customers to create sustainable resource-efficient value. Embedding software and AI in our products and solutions is an integral part of our strategy, with the majority of our offering including software or being digitally enabled. Over half of our research and development employees are focused on digital solutions. It enables differentiation, customer value creation and drives quality of revenues for ABB. All four of our Business areas are market leaders in their respective areas. Our global reach along with our extensive local presence assists us in scaling innovations to achieve stronger returns, which supports higher absolute investments for future growth. Active globally, our revenues are well-balanced across regions with customers served directly and through a strong channel partner network. With its long history, ABB not only invented or pioneered many power and automation technologies but has retained technology and market leadership in many of these areas. Being present in various vertical markets for decades, with close long-term relationships with customers and channel partners, has resulted in our unique deep domain expertise, enabling a thorough understanding of customers’ needs and operations. The ABB Way Our decentralized operating model, ABB Way, comprises a select number of common processes covering our business model, our people and culture, the ABB brand and our governance framework. It facilitates accountability, transparency and speed in ABB. 4 FINANCIAL REPORT 2024 In our operating model, the divisions represent the highest level of operating decisions. They are closest to their respective markets and customer needs. Each division progresses through the strategic mandates and priorities of stability and profitability before growth. In order to deploy full focus on organic and acquired growth to the extent of consolidating the market, the business’ structure should be robust and profitability should be at least in line with industry peers. Each division has full accountability for its results and carries the responsibility for business development and research and development for leading technology to secure a leading market position. During 2024 we cemented the decentralized way of working at ABB within all our divisions, ensuring accountability, transparency and speed in decision making. In 2025, we aim to move accountability further down within the organization, empowering leaders below the division level with strategic mandates and corresponding incentives to further drive results. Clear mandates and accountability at the business line level will enhance transparency and operational speed across the organization. Furthermore, we continue to shift our focus to profitable growth. Strong performance management is key in a decentralized business model. We apply a standardized monthly scorecard system for the Divisions and Business areas, to support full transparency of operational performance. It is accompanied by a limited select number of short-term incentives, including the mandatory target to make annual productivity improvements of at least 5 percent each year. The corporate functions focus on necessary strategic, financial and governance activities, with a lean headcount of less than 800 employees. Enhanced growth profile Over the past several years, we have taken significant actions to align our business portfolio around the ABB Purpose, resulting in all divisions now active only within the markets of electrification and automation. Both of these markets are benefiting from increasing global investments to decarbonize, increase energy efficiency and to automate and increase flexibility in society, including power generation, industrial manufacturing, buildings and process industries. Additionally, we have increased the proportion of sales stemming from short-cycle businesses, meaning a reduced proportion from project-related activities, which we believe should reduce the risk and volatility in our earnings. This ongoing shift towards better quality of revenues is now an integral part of governance and business execution. The responsibility for growth has been fully transferred to the divisions, as they are closest to customers. This includes both organic and acquired growth. The divisions have the best insights into current and future customer needs and are accountable for building their respective business accordingly. With more divisions transitioning over time from stability and profitability to growth, we expect to see a gradual strengthening of our growth profile. Finally, environmental, social and governance (ESG) drivers are accelerating and translating into increased demand for our electrification and automation offering. The demand for electricity is growing nine times as fast as other energy sources, resulting in approximately 70 percent higher average annual investments into distribution networks over the next seven years (source: IEA World Energy Outlook 2024, Announced Pledges Scenario). The share of low-carbon sources in the global energy mix is expected to increase to approximately 70 percent by 2050 from only 20 percent today (source: IEA World Energy Outlook 2024, Announced Pledges Scenario). The need to improve energy efficiency has never been more relevant, from both the perspective of sustainable operations and reducing operating costs in a high energy cost environment. Investments in energy efficiency are expected to increase 53 percent per year over the next seven years versus the seven previous years (source: IEA World Energy Outlook 2024, Announced Pledges Scenario). Today, approximately 45 percent of the world’s electricity is converted into motion by electric motors yet only less than 25 percent of the world’s electric motors are optimized through the control of drives. Lastly, the global number of working age people (15 to 64 years) per retiree (65 years or over) is expected to fall by about 24 percent between 2023 and 2035 (source: United Nations World Population Prospects 2024), supporting demand for robotics and automation solutions. We believe ABB’s offering is well positioned to address these trends. FINANCIAL REPORT 2024 5 — BUSINESSES OUR MARKETS ABB is a technology leader in electrification and automation with a comprehensive digitalized offering of electrification, motion and automation solutions. Our exposure to customers is geographically balanced while catering to multiple end-markets and segments. We believe our customer offering is well positioned to benefit from secular growth drivers, including urbanization, labor shortage, shift to electrification, automation and robotization, as well as other data and digitalization trends. We are focused on creating superior customer value through our comprehensive, modular offering, combining traditional products and services with software-enabled products and systems as well as digital services and software that we sell both separately and combined as scalable solutions. Our advanced software is a key differentiation of our digital offering and over half of our approximately 7,800 employees in research and development are active in software development. The majority of our businesses are market leaders within their respective segments. We believe market leadership is critical, as it provides the opportunity for price leadership, which in turn supports profitability, enabling us to invest further in research and development to sustain our technological leadership. For a discussion of the geographic distribution of our total revenues, see “Analysis of results of operations— Revenues.” Industry market Approximately half of our revenues are derived from customers within the industrial segment where we serve production facilities and factories all around the world, from process industries such as oil and gas, pulp and paper as well as mining, to discrete industries including automotive, food and beverage and consumer electronics. In discrete industries, orders declined sharply as customers in the machine builders segment adjusted their order patterns in response to shorter delivery lead times as well as the impacts from a weak underlying market. The robotics segment declined, driven mainly by fewer investments in the automotive sector and consumer electronics, while positive momentum was reported in logistics and general industry. Late-cycle process industries remained broadly stable from last year’s high level. Strength was noted in conventional power generation as well as the energy-related low-carbon segments. Oil and gas, mining and metals remained broadly stable, while some softness was noted in pulp and paper, and chemicals. Buildings market Approximately one-fifth of our offering is sold into the buildings market, with about two-thirds focused on commercial buildings and one-third on residential. Overall, orders in the buildings market improved, driven by positive developments in the commercial sector, particularly in the United States, while China continues to show weakness. The residential segment stabilized outside of China, which remains a challenging market. Transport & infrastructure market Approximately one-fifth of our customers operate in the transport & infrastructure market. Our expertise provides efficient, reliable and sustainable solutions for these customers, with a focus on energy efficiency and reduced operating costs. Demand for data centers remained robust, fueled by the expansion of digital services, including AI and remote work. In the marine segment, we experienced positive developments in both marine and port operations, while strong customer activity continued in the rail segment. Utilities market We deliver solutions mainly for distribution utilities and renewables customers, while continuing to service conventional power generation customers with our control and automation solutions. 6 FINANCIAL REPORT 2024 During 2024, the renewables markets continued to see strong growth. Business levels in the conventional power generation market have improved. Demand from electrical distribution utilities remained strong, with ongoing investments to increase grid reliability and resilience due to increased integration of renewables. We serve our customers through our operating divisions which are included in our Business areas. Developments in these Business areas are discussed in more detail below. Revenue figures presented in this “Businesses” section are before intersegment eliminations. — ELECTRIFICATION BUSINESS AREA Overview Electrification provides leading electrical distribution and management technologies, solutions and services to electrify the world in a safe, smart and sustainable way. The portfolio includes medium- and low-voltage electrical components, switchgear, digital devices, enclosures, and circuit breakers, among others. With our products, solutions and services, we collaborate with customers to improve power delivery and security, enhance energy management, efficiency and operational reliability, as we seek to achieve a low carbon society. The Electrification Business area delivers products to end customers through a global network of channel partners. More than half of the Business area’s revenue is derived from distributors and approximately 20 percent is derived from direct sales to end-users. The remaining revenues are generated from original equipment manufacturers (OEMs), engineering, procurement and construction (EPC) contracting companies, system integrators, utilities and panel builders. The proportion of direct compared to channel partner sales varies by segment, product technology and geographic markets. The Electrification Business area had approximately 51,700 employees as of December 31, 2024, and generated $15.4 billion of revenues in 2024. Customers The Electrification Business area serves a wide range of customer segments, including residential, commercial and industrial buildings, utilities, oil and gas, chemicals, data centers, renewables, food and beverage, transport and infrastructure, among others. From some of the world’s tallest buildings to the busiest airports, the Business area’s products and solutions cover a wide range of applications and business segments. Products and Services The Electrification Business area’s products and services are delivered through five operating divisions. The Distribution Solutions Division offers indoor and outdoor medium-voltage components, switchgear, and solutions that connect and protect the evolving energy grid. The Division enables the reliable integration of diverse power sources, including renewable energy, into the grid, ensuring continuous power delivery to industries, commercial facilities, and residential users. Its future-proof technologies protect utilities and industries from potential grid anomalies and its digital solutions enhance grid reliability by enabling fault analysis, prediction, and preventive maintenance by applying analytics and artificial intelligence. The Division supports customers and partners to stay ahead of increasing electrification needs and regulatory changes, providing technologies and solutions to adapt in a rapidly evolving energy landscape. The Smart Power Division provides energy distribution solutions for data centers, industrial and manufacturing plants, critical infrastructure and commercial buildings. The Division’s technical teams work closely with industry partners, delivering advanced solutions that support rapid growth, energy transition, and sustainability objectives. The Division’s portfolio includes industrial circuit breakers, low-voltage systems, motor starting applications, and safety devices like switches and relays. Its Power Protection unit supports the world’s largest data center companies with advanced energy-efficient UPS solutions. The Division’s ABB Ability™ Energy Manager provides a scalable, easy-to-use platform that helps organizations save energy and reduce CO 2 emissions. FINANCIAL REPORT 2024 7 The Smart Buildings Division enables energy efficiency, safety, and comfort for any building type, through new installations or retrofit solutions. The Division offers integrated building automation systems to control HVAC, lighting, shutters, door entry and emergency lighting. It ensures safe and reliable energy distribution solutions including DIN rail protection devices, enclosures and energy management systems through to industrial plugs and sockets and conventional wiring accessories, accommodating single family homes, multiple dwellings, commercial buildings, infrastructure and industrial applications. The Division’s highly innovative technologies and digital solutions serve the rising global demand among real estate developers, owners, and investors for smart building technologies that optimize energy distribution and building automation. The scalable solutions aim to deliver significant sustainable and financial benefits, meeting social and environmental demands, while being able to address even the most complex of customers’ carbon reduction strategies. The Installation Products Division helps manage the connection, protection and distribution of electrical power from source to socket. The Division’s products are engineered to provide ease of installation and perform in demanding and harsh conditions, helping to ensure safety and continuous operation for utilities, businesses and people around the world. The Commercial Essentials product segment includes electrical junction boxes, commercial fittings, strut and cable tray metal framing systems for commercial and residential construction. The Premier Industrial product segment includes multiple product lines, such as Ty-Rap® cable ties, T&B Liquidtight Systems® protection products, PVC coated and nylon conduit systems, power connection and grounding systems, and cable protection systems of conduits and fittings for harsh and industrial applications. The Division also manufactures solutions for medium-voltage applications used in the utility market under its marquee brands including Elastimold™ reclosers and switchgear with no SF6 gas, capacitor switches, current limiting fuses, Homac™ distribution connectors, Hi-Tech Valiant™ full-range current limiting fuse for fire mitigation, faulted current indicators and distribution connectors, cable accessories and apparatus with products for overhead and underground distribution. Manufacturing includes made-to-stock and custom-made solutions. The Service Division partners with our customers to improve the availability, reliability, predictability and sustainability of electrical products and installations. The Division’s extensive service portfolio offers product care, modernization, and advisory services to improve performance, extend equipment lifetime and deliver new levels of operational and sustainable efficiency. We help customers keep resources in use for as long as possible, extracting the maximum value from them, and then recovering and regenerating products and materials at the end of their useful life. Sales and Marketing Sales and marketing is generally conducted within the divisions in the Electrification Business area. This enables the divisions to manage their respective end-to-end activities and create demand across all channels, products and solutions. They increase focus and speed for our customers to drive faster growth. Where necessary, the divisions work together on joint services, such as the management of accounts, channels, and segment-sales, engaging in a range of promotional activities, both internal and external. Competition The Electrification Business area’s principal competitors vary by product group and include Atkore, Chint, Eaton, Hager, Hubbell, Legrand, LS Electric, Mitsubishi Electric, nVent, Panasonic, Schneider Electric, Siemens and Vertiv. Capital Expenditures The Electrification Business area’s capital expenditures for property, plant and equipment totaled $472 million in 2024, compared to $386 million in 2023. Investments in 2024 principally related to real estate investments, capacity expansion to support growth, as well as equipment replacement and upgrades. Geographically, in 2024, Europe represented 51 percent of the capital expenditures, followed by the Americas (38 percent) and Asia, Middle East and Africa (11 percent). — MOTION BUSINESS AREA Overview The Motion Business area provides pioneering technology, products, solutions and related services to industrial customers to improve safety and reliability, achieve better performance and provide energy efficient, decarbonizing and circular solutions. The portfolio includes motors, generators and drives for a wide range of applications in all industrial sectors. 8 FINANCIAL REPORT 2024 The Motion Business area designs, manufactures and sells drives, motors, generators, and traction solutions. Building on long-standing experience in electric powertrains, the Business area combines domain expertise and technology to deliver the optimum solution for a wide range of applications for a comprehensive range of industrial segments. In addition, the Business area, along with its channel partners, has an industry leading global service presence. The Motion Business area had approximately 22,400 employees as of December 31, 2024, and generated $7.8 billion of revenues in 2024. Customers The Motion Business area serves a wide range of customers in different industrial segments such as pulp and paper, oil and gas, metals and mining, food and beverage, HVAC, water and wastewater, transportation, power generation, marine and offshore. Products and Services The Motion Business area’s products and services are delivered through seven operating divisions. The Drive Products Division is a global technology leader serving industries, infrastructure segments and machine builders with world-class drives and programmable logic controllers (PLC). With its products, global scale and local presence, the Division helps customers, partners and equipment manufacturers to improve energy efficiency, asset reliability, productivity and safety. The System Drives Division is the market leader in high-power, high-performance drives and drive systems for industrial process and large infrastructure and marine applications, and a leading independent supplier of power conversion equipment for renewable energy. The Division offers to customers and partners global support, domain expertise in all major industries and an innovative and digitally enabled portfolio to help them achieve asset reliability, performance and energy efficiency in mission critical applications. The Service Division serves customers worldwide by maximizing uptime, extending life cycle, and improving the performance and energy efficiency of their motors, drives and generators. The Division leads the way in digitalization and delivers service solutions through dedicated service experts, service workshops, and its partner network, ensuring customer operations run profitably, safely and reliably. The Traction Division is a globally trusted independent supplier and recognized leader in onboard propulsion technologies that drive innovation in rail, bus, and industrial vehicle electrification. The Division partners with OEMs, operators, system integrators, and vehicle owners, offering a comprehensive range of high-performance and full lifecycle managed propulsion, auxiliary and energy storage solutions. Each solution is engineered to meet specific customer requirements and the operational conditions of the respective vehicle. This enables maximum energy efficiency, low carbon emissions and high reliability. The IEC Low Voltage Division is a global technology leader delivering a full range of energy-efficient low voltage motors, including hyper-efficient solutions such as IE6 SynRM (synchronous reluctance motors). Through a global footprint, domain expertise and rugged designs, the Division provides reliable technology that improves efficiency and productivity even in the most demanding applications . The Large Motors and Generators Division helps customers in all major industries and applications reach new levels of efficiency and energy savings, even under the most demanding conditions, by offering a comprehensive product portfolio of large AC motors and generators. The Division’s induction, synchronous and special design motors and synchronous generators power critical applications across industry, infrastructure and marine transportation. Combining the best available materials with superior technology, the large motors and generators are designed to operate efficiently and reliably, even for challenging processes or applications. These leading energy-efficient products allow for a reduced payback time and a lower total cost of ownership. The NEMA Motors Division is a marketer, designer and manufacturer that offers Baldor-Reliance® industrial electric motors, primarily in North America. The Division focuses on quality, reliability and efficiency to provide a comprehensive offering of NEMA motors in the market across most industrial segments and applications. Sales and Marketing Sales are made both through direct sales forces and through channel partners, such as distributors and wholesalers, as well as installers, OEMs and system integrators. The proportion of direct sales to end users compared to channel partner sales varies among the different industries, products and geographic markets. FINANCIAL REPORT 2024 9 Competition The principal competitors of the Motion Business area include Schneider Electric, Siemens, Toshiba, WEG Industries, Wolong and Danfoss. Capital Expenditures Capital expenditures in the Motion Business area for property, plant and equipment totaled $191 million in 2024, compared to $171 million in 2023. Principal expenditures in 2024 related to real estate investments, capacity expansion, equipment replacement and upgrades across various countries including the United States, Finland, Switzerland, China and India. Geographically, in 2024, Europe represented 49 percent of the capital expenditures, followed by the Americas (38 percent) and Asia, Middle East and Africa (13 percent). — PROCESS AUTOMATION BUSINESS AREA Overview The Process Automation Business area provides a comprehensive range of integrated automation, electrical and digital systems and services for customers in the process, hybrid and maritime industries. These offerings, coupled with deep domain knowledge in each end market, help to optimize productivity, energy efficiency, sustainability and safety of industrial processes and operations. The Business area’s offering can be grouped into two categories, with approximately half of the offering related to solutions for new and brownfield projects and half related to service, mainly for the existing installed base. Process Automation also integrates offerings from the Electrification, Motion and Robotics & Discrete Automation Business areas into its projects. The Business area’s offerings are sold primarily through its direct sales force with a smaller share through partners and distributors. The Business area had approximately 22,500 employees as of December 31, 2024, and generated revenues of $6.8 billion in 2024. Customers The Process Automation Business area’s end customers include companies across process, hybrid and maritime industries. These industries include oil, gas, renewables, chemicals, mining, metals, cement, pulp and paper, pharmaceuticals, battery manufacturing, food and beverage, space, power generation, water, marine and ports. Products and Services The Process Automation Business area offering includes an extensive portfolio of products, solutions, digital applications and services for the control of the simplest to the most complex and critical industrial processes and infrastructure. These systems can link various process and information flows, allowing customers to manage and control their entire production process based on real-time information. The Business area’s automation offering includes the distributed control system (DCS) ABB Ability™ System 800xA®, which is also an electrical control system, a safety system and a collaboration enabler with the capacity to improve engineering efficiency, operator performance and asset utilization. Other control solutions include Symphony® Plus (designed to address automation needs of the power and water industry segments) and the Freelance DCS solution. Components for basic automation solutions, process controllers, I/O modules, panels, and Human Machine Interfaces (HMI) are available through the Compact Product Suite offering. The product portfolio is complemented by a suite of ABB Ability™ advanced digital services and by ABB Care, a subscription-based lifecycle management program that provides services to maintain and continually advance and enhance ABB’s distributed control systems and optimize customers’ lifecycle costs. The ABB Ability™ Genix industrial IoT and AI suite contextualizes and integrates data from IT, engineering, and operations systems to provide deep, meaningful and actionable insights. The portfolio is complemented by a range of industry-specific technologies and applications in each division. As of December 31, 2024, the Process Automation Business area’s products and services are delivered through four operating divisions. 10 FINANCIAL REPORT 2024 The Energy Industries Division serves a wide range of industrial sectors, including hydrocarbons, renewables, chemicals, pharmaceuticals, power generation and water. With its integrated solutions that automate, electrify and digitalize operations, the Division is committed to supporting traditional industries in their efforts to decarbonize. The Division also supports the development, integration and scaling up of new and renewable energy models. The Division’s goal is to help customers adapt and succeed in the rapidly changing global energy transition. Harnessing data, machine learning and AI, the Division brings over 50 years of domain expertise delivering solutions designed to improve energy, process and production efficiency, as well as reduce risk, operational cost and capital cost, while minimizing waste for customers, from project start-up and throughout the entire plant lifecycle. The Process Industries Division serves the mining, minerals processing, metals, cement, pulp and paper, battery manufacturing, and food and beverage, as well as their associated service industries. The Division brings deep industry domain expertise coupled with the ability to integrate both automation and electrical systems, increase productivity and reduce overall capital and operating costs for customers. For mining, metals and cement customers, solutions include specialized products and services, as well as total production systems. The Division designs, plans, engineers, supplies, installs and commissions integrated electrical and motion systems, including electric equipment, drives, motors, high power rectifiers and equipment for automation and supervisory control within a variety of areas including mineral handling, mining operations, aluminum smelting, hot and cold steel applications and cement production. The offering for the pulp and paper industries includes control systems, quality control systems, drive systems, on-line sensors, actuators and field instruments. Digitalization solutions, including collaborative operations and augmented reality, help improve plant and enterprise productivity, and reduce maintenance and energy costs. The Marine & Ports Division serves the shipping and ports industries through its extensive portfolio of integrated systems and solutions that improve the flexibility, reliability and energy efficiency of vessels and container terminals. By coupling power, propulsion, automation, marine software and services that ensure maximum vessel uptime, the Division is well positioned to help the marine industry to achieve its decarbonization targets while improving the profitability and sustainability of our customers’ business throughout the entire lifecycle of vessels. With ABB Ability™ marine software solutions and ABB Ability™ Collaborative Operations Centers around the world, shipowners and operators can run their fleets at lower fuel and maintenance costs, while improving crew, passenger and cargo safety as well as overall productivity of their operations. Further, the Division delivers automation, electrical systems and digital solutions for container and bulk cargo handling, from ship to gate. These solutions help terminal operators meet the challenge of larger ships, taller cranes and bigger volumes per call, and make terminal operations safer, greener and more productive. The Measurement & Analytics Division is among the world’s leading manufacturers and suppliers of smart instrumentation and analyzers, working at the heart of industrial digital transformation. The Measurement & Analytics Division’s portfolio consists of analyzers measuring compositions of gases and liquids; instrumentation measuring process variables such as temperature, pressure, flow, and level; force measurement solutions measuring parameters such as flatness, thickness, and tension; and advanced digital solutions for device management, device health check and predictive maintenance. The Measurement & Analytics Division serves key industries such as oil and gas, chemical, water and wastewater, power, hydrogen, batteries, as well as the marine industry. The Division enables the optimization of industrial processes by providing and analyzing data collected from sensing and smart measurement devices. Parameters such as emission levels and production inputs are measured by providing ‘before’ and ‘after’ values, enabling efficient operations and environmental sustainability through measurement. Sales and Marketing The Process Automation Business area’s sales are primarily made through its direct sales force as well as third-party channel partners, such as distributors, system integrators and OEMs. The majority of revenues are derived through the Business area’s own direct sales channels. Competition The Process Automation Business area’s principal competitors vary by industry or product group. Competitors include: Emerson, Honeywell, Schneider Electric, Siemens, Siemens Energy, Yokogawa, Endress + Hauser, Kongsberg and Valmet. FINANCIAL REPORT 2024 11 Capital Expenditures The Process Automation Business area’s capital expenditures for property, plant and equipment totaled $62 million in 2024, compared to $66 million in 2023. Principal investments in 2024 primarily related to equipment replacement and upgrades, mainly in the Energy Industries Division and Measurement & Analytics Division. Geographically, in 2024, Europe represented 65 percent of the capital expenditures, followed by the Americas (20 percent) and Asia, Middle East and Africa (15 percent). — ROBOTICS & DISCRETE AUTOMATION BUSINESS AREA Overview The Robotics & Discrete Automation Business area provides robotics, and machine and factory automation including products, software, solutions and services. Revenues are generated both from direct sales to end-users as well as from indirect sales, mainly through system integrators and machine builders. The Robotics & Discrete Automation Business area had approximately 10,800 employees as of December 31, 2024, and generated $3.2 billion of revenues in 2024. Customers The Robotics & Discrete Automation Business area serves a wide range of customers. The main customers are active in industries such as automotive, machine building, metalworking, electronics, food and beverage and logistics. They include end-users such as manufacturers, system integrators and machine builders. Products and Services The Robotics & Discrete Automation Business area’s products and services are delivered through two operating divisions. The Robotics Division offers a wide range of products, solutions and services including robots, autonomous mobile robots, robotics application cells and smart systems, field services, spare parts, digital services, engineering and operations software. This offering provides customers with increased productivity, quality, flexibility and simplicity for operations, e.g. to meet the challenge of making smaller lots of a larger number of specific products in shorter cycles for today’s dynamic global markets and coping with increasing uncertainty. Robots are also used in activities or environments which may be hazardous to employee health and safety, such as repetitive or strenuous lifting, dusty, hot or cold rooms, or painting booths and can help customers address labor shortages. Robotics solutions are used in a wide range of segments from automotive OEMs, automotive suppliers, electronics, general industry, consumer goods, food and beverage, and warehouse/logistics center automation. They are increasingly deployed in service applications for life sciences care, restaurants and retail. Typical robotic applications include welding, material handling, machine tending, machining, painting, picking, packing, palletizing and assembly. The Machine Automation Division offers integrated automation solutions based on programmable logical controllers, industrial PCs, servo motion, industrial transport systems and machine vision. It also provides software for engineering and optimization. The range of solutions are mainly used by machine builders for various types of series machines, e.g. for plastics, metals, printing and packaging. Sales and Marketing Sales are made both through direct sales as well as through third ‑ party channel partners, such as system integrators and machine builders. The proportion of direct sales compared to channel partner sales varies among the different industries, product technologies and geographic markets. Competition Competitors of the Robotics & Discrete Automation Business area vary by offering and include companies such as Fanuc, Kuka, Yaskawa, Epson, Dürr, Stäubli, Universal Robots, Rockwell Automation, Siemens, Mitsubishi Electric and Beckhoff. 12 FINANCIAL REPORT 2024 Capital Expenditures The Robotics & Discrete Automation Business area’s capital expenditures for property, plant and equipment totaled $81 million in 2024, compared to $71 million in 2023. Principal investments in 2024 were primarily related to production enhancements in China and Sweden in the Robotics Division and Austria in the Machine Automation Division. In 2024, Europe represented 65 percent of capital expenditures, followed by Asia, Middle East and Africa (20 percent) and the Americas (15 percent). — CORPORATE AND OTHER Corporate includes core headquarter functions, real estate activities, Corporate Treasury, functional shared services for human resources, finance and information services and other minor business activities while Other includes the E-mobility Division, which is a separate operating segment, other non-core operating activities, as well as the remaining activities of certain EPC projects which we are completing and are in a wind-down phase. Retained obligations from certain divested businesses are also included in Other including the high-voltage cables business, steel structures and certain EPC contracts relating to the oil and gas industry. Certain strategic investments managed by ABB Technology Ventures are also included in Corporate and Other. Corporate headquarters and stewardship activities include the operations of our corporate headquarters in Zurich, Switzerland, as well as limited corporate ‑ related activities in certain countries. These activities cover staff functions with group ‑ wide responsibilities, such as accounting and financial reporting, corporate finance and corporate treasury, taxes, internal audit, legal and integrity, compliance, risk management and insurance, corporate communications, human resources, information systems and investor relations. We operate shared service centers globally through a network of hubs which consist of services in the areas of human resources, finance and information services. We also staff and maintain front offices in various countries. The costs of these shared services are incurred primarily for the benefit of the Business areas, which are charged for their use of such services and the related number of employees are allocated to the Business areas. Similarly, a significant portion of the shared corporate overhead costs are charged to the operating businesses. In some cases, we also provide services to third parties under transitional service agreements in relation to certain divested businesses. 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 electrification of fleets and charging for electric buses and trucks. Corporate and Other had approximately 2,500 employees at December 31, 2024, of which approximately 1,700 pertain to the E-mobility Division and our other non-core businesses. — DISCONTINUED OPERATIONS In 2020, we completed the divestment of our Power Grids business to Hitachi Ltd (Hitachi). As a result, the Power Grids business was reported as discontinued operations in the Consolidated Financial Statements. See “Note 3 - Discontinued operations” to our Consolidated Financial Statements. FINANCIAL REPORT 2024 13 — CAPITAL EXPENDITURES Total capital expenditures for property, plant and equipment and intangible assets (excluding intangibles acquired through business combinations) amounted to $845 million, $770 million and $762 million in 2024, 2023 and 2022, respectively. In 2024 and 2023, capital expenditures were 5 percent higher and 1 percent lower, respectively, than depreciation and amortization. Excluding acquisition-related amortization, capital expenditures were 41 percent higher in 2024 and 37 percent higher in 2023, respectively, than depreciation and amortization. Capital expenditures in 2024 primarily focused in mature markets, reflecting the geographic distribution of our existing production facilities. Capital expenditures in Europe and the Americas in 2024 were driven primarily by upgrades of existing production facilities and capacity expansion, mainly in the U.S., Germany, Switzerland, Sweden, Finland, and Italy. In Asia, Middle East and Africa, capital expenditures were made primarily to increase production capacity by investing in new or expanded facilities, the highest of which were in China and India. The share of emerging markets capital expenditures as a percentage of total capital expenditures in 2024 and 2023 was 25 percent and 23 percent, respectively. At December 31, 2024, construction in progress for property, plant and equipment was $690 million, mainly in the U.S., Germany, Switzerland and Sweden, while at December 31, 2023, construction in progress for property, plant and equipment was $713 million, mainly in the U.S., Germany, Switzerland, and Finland. Our capital expenditures relate primarily to property, plant and equipment and are funded primarily through cash flows from operating activities. For 2025, we estimate the expenditures for property, plant and equipment will be higher than our annual depreciation and amortization charge, excluding acquisition-related amortization. — SUPPLIES AND RAW MATERIALS We purchase a variety of supplies and products which contain raw materials for use in our production and project execution processes. The primary materials used in our products, by weight, are copper, steel, aluminum, mineral oil and various plastics. We also purchase a wide variety of fabricated products, electronic components and systems. We operate a worldwide supply chain management network with employees dedicated to this function in our Business areas, divisions and in key countries. Our supply chain operations consist of a number of teams, each focusing on different product categories. These category teams are tasked with taking advantage of opportunities to leverage the scale of ABB on a global, Business area and/or division level, as appropriate, to optimize the efficiency of our supply networks in a sustainable manner. Our supply chain management organization’s activities and objectives include: • pool and leverage procurement of materials and services, • provide transparency of ABB’s global spending through a comprehensive performance and reporting system linked to our enterprise resource planning (ERP) systems, • strengthen ABB’s supply chain network by implementing an effective product category management structure and extensive competency-based training, and • monitor and develop our supply base to ensure sustainability, both in terms of materials and processes used. 14 FINANCIAL REPORT 2024 We buy many categories of products which contain copper, steel, aluminum, crude oil and other commodities. Continuing global economic growth in many emerging economies, coupled with the volatility in foreign currency exchange rates, has led to significant fluctuations in these raw material costs over the last few years. While we expect global commodity prices to remain highly volatile, we expect to offset some market volatility through the use of long-term contracts and global sourcing. We seek to mitigate the majority of our exposure to commodity price risk by entering into derivative contracts. For example, we manage copper, steel, aluminum, and silver price risk using principally swap contracts based on prices for these commodities quoted on leading exchanges. ABB’s hedging policy is designed to safeguard margins by minimizing price volatility and providing a stable cost base during order execution. In addition to using derivatives to reduce our exposure to fluctuations in raw materials prices, in some cases we can reduce this risk by incorporating changes in raw materials prices into the prices of our end products (through price escalation clauses). Throughout 2024, we continued to optimize our value chain in all aspects of our business, while ensuring high standards of quality and delivery. Despite some continuing global supply chain challenges such as rising costs, port congestion, material access issues and some geopolitical uncertainty, we were able to mitigate these difficulties with efforts from our dedicated category teams, supply chain management personnel and Business area task forces. We also enhanced our rigorous supplier onboarding process involving comprehensive integrity due diligence and competitive bidding for our potential and existing vendors. This helps in reducing the risk of fraud, corruption and noncompliance as well as in securing the best value and quality for our products and services. The involvement of the supply chain is also crucial in monitoring HSE (Health, Safety, and Environment) risks. By implementing a contractor qualification process, we can ensure that only assessed suppliers and contractors are selected for on-site activities. This approach helps to keep incidents as low as possible by working with qualified and reliable partners. All these supply chain activities are embedded in a continuous monitoring process that includes supplier performance evaluation, supplier audits, and risk monitoring. This ensures that we can identify problems in time and provide corrective actions as safeguards. As a result, we were able to minimize the impact of supply chain disruptions, maintain a high level of customer satisfaction and support our business growth. Through our Sustainable Supply Base Management (SSBM) approach, we assess environment, social and governance (ESG) risks, compliance, and the performance of our suppliers in these areas to make sure they meet our expectations. These expectations are detailed in the ABB Code of Conduct and the ABB Supplier Code of Conduct. The SSBM program includes both supplier self-assessments and on-site assessments/audits, covering both new supplier on-boarding and existing supplier monitoring. In 2024, we continued to work closely with our suppliers to ensure compliance with these standards and to drive improvements in sustainability practices across our supply chain. We initiated conflict mineral processes in 2013 and have continuously aimed at improving and tailoring the processes to our value chain, continuing to work with our suppliers and customers. In 2024, we continued our cobalt due diligence process and have extended the program further to include mica. Further information on ABB’s Conflict Minerals policy and supplier requirements can be found under “Responsible Minerals Sourcing” at https://global.abb/group/en/about/supplying/responsible-minerals. Furthermore, ABB has developed a list of prohibited and restricted substances to ensure that the materials we use do not contribute to environmental degradation. We update this list regularly in line with international regulations, including the U.S. Toxic Substances Control Act (TSCA) regulations and California Proposition 65. More information on our Product Material Compliance program and supplier requirements can be found under “Material Compliance” at https://global.abb/group/en/about/supplying/material-compliance. In November 2023, ABB announced its Net Zero emission targets, which were approved by the SBTi in 2024. For Scope 3, this means a reduction of 25 percent by 2030, compared to a 2022 baseline. As supply chain emissions form part of overall Scope 3 emissions, ABB continues to work closely with its most impactful suppliers to reduce GHG emissions along the supply chain. In 2024, we continued our partnership with EcoVadis, a leading service provider in the ESG domain, to engage with suppliers for GHG emission data collection and supplier education on this topic. FINANCIAL REPORT 2024 15 — DESCRIPTION OF PROPERTY As of December 31, 2024, we occupy real estate in around 100 countries throughout the world. The facilities consist mainly of manufacturing plants, office buildings, research centers and warehouses. A substantial portion of our production and development facilities is situated in China, the U.S., Germany, Finland, Sweden, Italy, Canada, Poland, India, Mexico and the Czech Republic. We also own or lease other properties, including office buildings, warehouses, research and development facilities and sales offices in many countries. We own substantially all of the machinery and equipment used in our manufacturing operations. From time to time, we have a surplus of space arising from acquisitions, production efficiencies and/or restructuring of operations. Normally, we seek to sell such surplus space which may involve leasing property to third parties for an interim period. The net book value of our property, plant and equipment at December 31, 2024, was $4,177 million, of which machinery and equipment represented $1,388 million, land and buildings represented $2,006 million and construction in progress represented $783 million. We believe that our current facilities are in good condition and are adequate to meet the requirements of our present and foreseeable future operations. — MANAGEMENT OVERVIEW In 2024, we strengthened our operations and increased results with broad improvements across the income statement. These improvements were supported by a strong underlying market, driven by electrification but also through improvements in operations, demonstrating that changes introduced through the ABB Way are making ABB a sustainable, well running company. After a period of transformation, all our businesses are now aligned with our purpose and are well-positioned at the center of key trends, such as electricity becoming the primary energy source and the increasing need for automation and digitalization to remain able to produce. We support our customers with high-quality, low-carbon solutions and energy efficient offerings, while also helping manufacturing companies automate for greater resource efficiency. This year we saw strong growth in our electrification offerings, driven by rapidly increasing demand for electricity, which is expected to grow nine times faster than other energy sources between 2023 and 2030. This strength more than offset softness in discrete automation. Although the fundamental long-term market drivers remain intact in this business segment, customer activity this year was tempered mainly by normalized ordering patterns after a period of pre-buys. The ABB Way operating model is firmly established within our organization, supported by the fact that our new CEO, Morten Wierod, and two new Business area presidents, Giampiero Frisio and Brandon Spencer, are internal hires with proven track records of successfully managing within this framework. From this strong level we see opportunities to deepen the impact of the ABB Way by extending it further into the business lines. Our goal is to make the ABB Way second nature across all teams, incentivizing management with clear strategic mandates, as well as increasing accountability, transparency and speed of operations. By applying this framework at a more granular level, each division can tailor strategies to its specific needs, ensuring consistent and focused performance throughout the organization. Active portfolio management remains a key part of our performance culture and is integrated into the responsibilities of divisional management teams. While we are committed to acquisitions as a growth driver, it is not yet fully ingrained in our ways of working and this will continue to be a focus area going forward. This includes identifying areas for inorganic growth through acquisitions related to new segments, new market access, better economies of scale or filling technology gaps. The divisions also assess, based on systematic portfolio reviews, whether, ultimately, their division is the best owner of their different businesses. 16 FINANCIAL REPORT 2024 In 2024, we accelerated this activity with bolt-on acquisitions and strategic partnerships led by our divisions, completing seven acquisitions and nine new venture capital investments, as well as eight follow-on investments, moving us closer to our target range of 1 to 2 percent of revenue growth through acquisitions. The Service Division in the Electrification Business area acquired the SEAM Group, which adds energy asset management and advisory services to clients across industrial and commercial building markets while the Process Automation Business area completed three acquisitions, the largest being the acquisition of Födisch Group, in the Measurement & Analytics Division. The Motion Business area also completed the integration of two previously announced acquisitions and announced the acquisition of the power electronics business of Gamesa Electric in Spain from Siemens Gamesa which expected to close in the second half of 2025 and will strengthen ABB’s position in the growing market for high-powered renewable power conversion technology. Electrification also announced another sizeable acquisition. We have agreed to acquire the Wiring & Accessories business of Siemens in China, led by our Smart Buildings Division, which will expand our market reach and enhance our regional customer offerings with a full range of safe and reliable smart building technologies. Business progress During 2024, underlying demand for ABB’s offering remained resilient, improving still on the high level in the previous year. Throughout the year we saw strong customer activity in investments to strengthen electrical infrastructure, expand power generation and integrate renewables. Demand was strong in data centers, as well as in the marine, ports, and rail sectors. Investments in the buildings segments improved year-on-year driven mainly by investments in commercial buildings while residential buildings stabilized outside of China. In the robotics-related segments, orders declined in automotive but improved in general industry and consumer- related segments. The machine builder segment declined as customers normalized order patterns after earlier pre-buys and a softer underlying market. In total, orders were flat year-on-year (increased 1 percent in local currencies) and continued to exceed revenues in three out of four Business areas. Revenues in 2024 improved 2 percent (3 percent comparable) to $32,850 million, driven primarily by volume with some additional support from price. The positive developments in the Electrification and Process Automation Business areas were partially offset by sharp declines in the Robotics & Discrete Automation Business area and the E-mobility business, where the markets were weak and order backlog in Robotics & Discrete Automation normalized. The Motion Business area, meanwhile, remained broadly stable while growth from backlog execution in the long-cycle businesses, as well as positive price impacts were offset by declines in the short-cycle business. Group profitability showed strong improvement during 2024 with improvements recorded in three out of four Business areas. The result was driven by the positive impacts from higher volumes and pricing which more than offset some inflation related to commodities and labor. The result also reflects the impacts from operational efficiency measures which outweighed some additional expenses related to research and development and selling, general and administrative activities. The profitability improvement and our ability to reduce net working capital allowed us to achieve strong operating cashflows and deliver in line with our ambition of reaching a free cash flow of at least last year’s level. Cash flows from operating activities improved to $4.7 billion in 2024, an increase of $0.4 billion compared to 2023. Financial targets confirmed Under the new leadership of Morten Wierod as CEO, we reconfirmed our commitment to achieving our financial targets set during 2023. We target growth of 5 to 7 percent for comparable average revenue growth through an economic cycle which is a constant currency measure and excludes impacts from acquisitions and divestments. In addition, we continue to target 1 to 2 percent acquired revenue growth through the economic cycle, net of acquisitions and divestments. For the Operational EBITA margin, our target is to be in the range of 16 to 19 percent on an annual basis. As a result of our higher growth and Operational EBITA margin targets and increasing focus on capital returns, our Return on Capital Employed (ROCE) target remains to be above 18 percent excluding transformative deals (defined as being larger than 3 percent of annual consolidated revenues). Additionally, we have sharpened our EPS growth target to be at least in the high single-digits through the economic cycle, reflecting our confidence in our ability to sustainably reduce the gap between Operational EBITA and Income from operations. Lastly, we maintain our target to achieve a free cash flow conversion of approximately 100 percent on an annual basis. FINANCIAL REPORT 2024 17 Capital allocation Our capital allocation priorities are unchanged. Our goal is profitable growth. Our top priority is to fund organic growth through strategic investments in research and development and production capacity. In 2024, we allocated $1.5 billion to non-order related research and development, representing 4.5 percent of revenues, and increased our capital expenditure by 10 percent to $845 million. Beyond that, our policy is to maintain a rising, sustainable dividend per share over time. With the remaining free cash flow, we plan to increase our business acquisition activity to achieve our target of adding 1 to 2 percent growth through acquisitions. Lastly, share buybacks will continue to be part of our strategy; however, the extent of these programs will ultimately depend on the level committed to acquisitions. We expect our strong cash generation to continue on the back of the ABB Way operating model, which will allow us to invest in both organic growth and bolt-on acquisitions, while providing attractive returns to shareholders. At the 2025 Annual General Meeting, the Board of Directors is proposing a dividend of 0.90 Swiss francs per share. Under the various share buyback programs we repurchased $ 1 billion of shares in 2024. Sustainability Agenda With our Sustainability Agenda, we are actively contributing to a more sustainable world, leading by example in our own operations and partnering with customers and suppliers to enable a low-carbon society, preserve resources and promote social progress. All three pillars of our sustainability agenda are underpinned by our commitment to create a culture of integrity and transparency across our value chain. In 2024, we obtained approval from the Science Based Targets initiative (SBTi) for our updated net-zero targets. We have raised our Scope 3 emissions reduction target to 25 percent by 2030. By 2050, we aim to achieve a 100 percent reduction in Scope 1 and 2 emissions from our 2019 baseline, and a 90 percent reduction in Scope 3 emissions from our 2022 baseline. Furthermore, we are making good progress towards our sustainability targets and have embedded sustainability even further into our divisions. For a detailed discussion of our Sustainability Strategy 2030 and our progress in 2024, see our “Sustainability Statement” available as part of our annual reporting suite on our website at https://global.abb/group/en/investors/annual-reporting-suite. — CRITICAL ACCOUNTING POLICIES AND ESTIMATES GENERAL We prepare our Consolidated Financial Statements in accordance with U.S. GAAP and present these in U.S. dollars unless otherwise stated. The preparation of our financial statements requires us to make assumptions and estimates that affect the reported amounts of assets, liabilities, revenues and expenses and the related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis (see “Note 2 - Significant accounting policies” to our Consolidated Financial Statements for a listing of our most significant accounting estimates). Where appropriate, we base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from our estimates and assumptions. 18 FINANCIAL REPORT 2024 We deem an accounting policy to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made and if different estimates that reasonably could have been used, or if changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact our Consolidated Financial Statements. We also deem an accounting policy to be critical when the application of such policy is essential to our ongoing operations. We believe the following critical accounting policies require us to make subjective judgments, often as a result of the need to make estimates regarding matters that are inherently uncertain and material to our Consolidated Financial Statements. These policies should be considered when reading our Consolidated Financial Statements. REVENUE RECOGNITION A customer contract exists if collectability under the contract is considered probable, the contract has commercial substance, contains payment terms, the rights and commitments of both parties, and has been approved. By analyzing the type, terms and conditions of each contract or arrangement with a customer, we determine which revenue recognition method applies. We recognize revenues when control of goods or services is transferred to customers in an amount that reflects the consideration we expect to be entitled to in exchange for these goods or services. Control is transferred when the customer has the ability to direct the use and obtain the benefits from the goods or services. The percentage ‑ of ‑ completion method of accounting is generally used when recognizing revenue on an over time basis and involves the use of assumptions and projections, principally relating to future material, labor, subcontractor and project ‑ related overhead costs as well as estimates of the amount of variable consideration to which we expect to be entitled. As a consequence, there is a risk that total contract costs or the amount of variable consideration will, respectively, either exceed or be lower than those we originally estimated (based on all information reasonably available to us) and the margin will decrease or the contract may become unprofitable. This risk increases if the duration of a contract increases because there is a higher probability that the circumstances upon which we originally developed our estimates will change, resulting in increased costs that we may not recover. Factors that could cause costs to increase include: • unanticipated technical problems with equipment supplied or developed by us which may require us to incur additional costs to remedy, • changes in the cost of components, materials or labor, • difficulties in obtaining required governmental permits or approvals, • project modifications creating unanticipated costs, • suppliers’ or subcontractors’ failure to perform, and • delays caused by unexpected conditions or events. Changes in our initial assumptions, which we review on a regular basis between balance sheet dates, may result in revisions to estimated costs, current earnings and anticipated earnings. We recognize these changes in the period in which the changes in estimates are determined. By recognizing changes in estimates cumulatively, recorded revenue and costs to date reflect the current estimates of the stage of completion of each project. Additionally, losses on such contracts are recognized in the period when they are identified and are based upon the anticipated excess of contract costs over the related contract revenues. PENSION AND OTHER POSTRETIREMENT BENEFITS As more fully described in “Note 18 - Employee benefits” to our Consolidated Financial Statements, we have a number of defined benefit pension and other postretirement plans and recognize an asset for a plan’s overfunded status or a liability for a plan’s underfunded status in our Consolidated Balance Sheets. We measure such a plan’s assets and obligations that determine its funded status as of the end of the year. Significant differences between assumptions and actual experience, or significant changes in assumptions, may materially affect the pension obligations. The effects of actual results differing from assumptions and the changing of assumptions are included in net actuarial loss within Accumulated other comprehensive loss. FINANCIAL REPORT 2024 19 We recognize actuarial gains and losses gradually over time. Any cumulative unrecognized actuarial gain or loss that exceeds 10 percent of the greater of the present value of the projected benefit obligation (PBO) and the fair value of plan assets is recognized in earnings over the expected average remaining working lives of the employees participating in the plan, or the expected average remaining lifetime of the inactive plan participants if the plan is comprised of all or almost all inactive participants. Otherwise, the actuarial gain or loss is not recognized in the Consolidated Income Statements. We use actuarial valuations to determine our pension costs and credits. The amounts calculated depend on a variety of key assumptions, including discount rates, mortality rates and expected return on plan assets. Under U.S. GAAP, we are required to consider current market conditions in making these assumptions. In particular, the discount rates are reviewed annually based on changes in long ‑ term, highly ‑ rated corporate bond yields. Decreases in the discount rates result in an increase in the PBO and a decrease in pension costs. Conversely, an increase in the discount rates results in a decrease in the PBO and an increase in pension costs. The mortality assumptions are reviewed annually by management. Decreases in mortality rates result in an increase in the PBO and in pension costs. Conversely, an increase in mortality rates results in a decrease in the PBO and in pension costs. Holding all other assumptions constant, a 0.25 percentage-point decrease in the discount rate would have increased the PBO related to our defined benefit pension plans by $146 million while a 0.25 percentage-point increase in the discount rate would have decreased the PBO related to our defined benefit pension plans by $142 million. The expected return on plan assets is reviewed regularly and considered for adjustment annually based upon the target asset allocations and represents the long ‑ term return expected to be achieved. Decreases in the expected return on plan assets result in an increase to pension costs. Holding all other assumptions constant, an increase or decrease of 0.25 percentage points in the expected long ‑ term rate of asset return would have decreased or increased, respectively, the net periodic benefit cost in 2024 by $16 million. The funded status, which can increase or decrease based on the performance of the financial markets or changes in our assumptions, does not represent a mandatory short-term cash obligation. Instead, the funded status of a defined benefit pension plan is the difference between the PBO and the fair value of the plan assets. Our defined benefit pension plans were overfunded by $246 million and $212 million at December 31, 2024 and 2023, respectively. INCOME TAXES In preparing our Consolidated Financial Statements, we are required to estimate income taxes in each of the jurisdictions in which we operate. Tax expense from continuing operations is reconciled from the weighted ‑ average global tax rate (rather than from the Swiss domestic statutory tax rate). As the parent company of the ABB Group, ABB Ltd, is domiciled in Switzerland, income which has been generated in jurisdictions outside of Switzerland (hereafter “foreign jurisdictions”) and has already been subject to corporate income tax in those foreign jurisdictions is, to a large extent, tax exempt in Switzerland. Therefore, generally no or only limited Swiss income tax has to be provided for on the repatriated earnings of foreign subsidiaries. There is no requirement in Switzerland for a parent company of a group to file a tax return of the group determining domestic and foreign pre ‑ tax income and as our consolidated income from continuing operations is predominantly earned outside of Switzerland, corporate income tax in foreign jurisdictions largely determines our global weighted ‑ average tax rate. We account for deferred taxes by using the asset and liability method. Under this method, we determine deferred tax assets and liabilities based on temporary differences between the financial reporting and the tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. We recognize a deferred tax asset when it is more likely than not that the asset will be realized. We regularly review our deferred tax assets for recoverability and establish a valuation allowance based upon historical losses, projected future taxable income and the expected timing of the reversals of existing temporary differences. To the extent we increase or decrease this allowance in a period, we recognize the change in the allowance within Income tax expense in the Consolidated Income Statements unless the change relates to discontinued operations, in which case the change is recorded in Loss from discontinued operations, net of tax. Unforeseen changes in tax rates and tax laws, as well as differences in the projected taxable income as compared to the actual taxable income, may affect these estimates. 20 FINANCIAL REPORT 2024 Certain countries levy withholding taxes, dividend distribution taxes or additional corporate income taxes (hereafter “withholding taxes”) on dividend distributions. Such taxes cannot always be fully reclaimed by the shareholder, although they have to be declared and withheld by the subsidiary. Switzerland has concluded double taxation treaties with many countries in which we operate. These treaties either eliminate or reduce such withholding taxes on dividend distributions. It is our policy to distribute retained earnings of subsidiaries, insofar as such earnings are not permanently reinvested or no other reasons exist that would prevent the subsidiary from distributing them. No deferred tax liability is set up if retained earnings are considered as indefinitely reinvested and used for financing current operations as well as business growth through working capital and capital expenditure in those countries. We operate in numerous tax jurisdictions and, as a result, are regularly subject to audit by tax authorities, including for transfer pricing. We provide for tax contingencies whenever it is deemed more likely than not that a tax asset has been impaired or a tax liability has been incurred for events such as tax claims or changes in tax laws. Contingency provisions are recorded based on the technical merits of our filing position, considering the applicable tax laws and OECD guidelines and are based on our evaluations of the facts and circumstances as of the end of each reporting period. Changes in the facts and circumstances could result in a material change to the tax accruals. Although we believe that our tax estimates are reasonable and that appropriate tax reserves have been made, the final determination of tax audits and any related litigation could be different than that which is reflected in our income tax provisions and accruals. An estimated loss from a tax contingency must be accrued as a charge to income if it is more likely than not that a tax asset has been impaired or a tax liability has been incurred and the amount of the loss can be reasonably estimated. We apply a two ‑ step approach to recognize and measure uncertainty in income taxes. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50 percent likely of being realized upon ultimate settlement. The required amount of provisions for contingencies of any type may change in the future due to new developments. GOODWILL AND INTANGIBLE ASSETS We review goodwill for impairment annually as of October 1, or more frequently if events or circumstances indicate that the carrying value may not be recoverable. We use either a qualitative or quantitative assessment method for each reporting unit. As each of our divisions have full ownership and accountability for their respective strategies, performance and resources, we have determined our reporting units to be at the division level, which is generally one level below our reportable segments of Electrification, Motion, Process Automation and Robotics & Discrete Automation. When performing the qualitative assessment, we first determine, for a reporting unit, factors which would affect the fair value of the reporting unit including: (i) macroeconomic conditions related to the business, (ii) industry and market trends, and (iii) the overall future financial performance and future opportunities in the markets in which the business operates. We then consider how these factors would impact the most recent quantitative analysis of the reporting unit’s fair value. Key assumptions in determining the fair value of the reporting unit include the projected level of business operations including future expected profit margins, the reporting unit’s weighted-average cost of capital and the terminal growth rate. In 2024, we reduced our ownership interest in InCharge Energy, Inc. which was part of our E-mobility operating segment (included within Corporate and Other), see Note 4 Acquisitions, divestments and equity-accounted companies. Apart from the aforementioned, there were no other changes to our divisions. Where a change in reporting unit arises during the course of the financial year, an interim impairment test is conducted before and after the change. In both the ‘before’ and ‘after’ tests, it was concluded that the fair value of the reporting units exceeded the carrying value by a significant amount. FINANCIAL REPORT 2024 21 We periodically select certain divisions for quantitative assessment based on a number of factors including but not limited to duration between valuation assessments, frequency and magnitude of acquisitions and divestments, internal organization changes and other external market factors, as well as underlying division performance. In 2024, we elected to perform quantitative assessments for six divisions: Smart Buildings, Drive Products, System Drives, Measurement & Analytics, Robotics and Machine Automation, and our two E-mobility reporting units. For each of these divisions the fair value was determined using a discounted cash flow fair value estimate based on objective information available at the measurement date. The significant assumptions used to develop the estimates of fair value for each division included management’s best estimates of the expected future results, as well as discount and terminal growth rates specific to the reporting unit. The fair value estimates were based on assumptions that a market participant would expect to use, but which are inherently uncertain and thus, actual results may differ from those estimates. The fair values for each of the individual reporting units and their associated goodwill were determined using Level 3 measurements. In each of the above quantitative assessments, it was concluded that the fair value of the reporting unit exceeded its carrying value by more than 100 percent. For the remaining divisions, we performed qualitative assessments and determined that it was not more likely than not that the fair value for each of these reporting units was below the carrying value. Intangible assets are reviewed for recoverability upon the occurrence of certain triggering events (such as a decision to divest a business or projected losses of an entity) or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We record impairment charges other than impairments of goodwill in Other income (expense), in our Consolidated Income Statements, unless they relate to a discontinued operation, in which case the charges are recorded in Loss from discontinued operations, net of tax. — NEW ACCOUNTING PRONOUNCEMENTS For a description of accounting changes and recent accounting pronouncements, including the expected dates of adoption and estimated effects, if any, on our Consolidated Financial Statements, see “Note 2 - Significant accounting policies” to our Consolidated Financial Statements. — ACQUISITIONS AND DIVESTMENTS ACQUISITIONS During 2024, 2023, and 2022, ABB paid $583 million, $175 million and $195 million to purchase seven, seven and five businesses, respectively. The largest of our acquisitions in 2024 was the Födisch Group, a worldwide provider of advanced measurement and analytical solutions for the energy and industrial sectors, resulting in net cash outflows of $287 million and enhancing Process Automation’s offering in continuous emission monitoring systems (CEMS). 22 FINANCIAL REPORT 2024 The principal acquisition in 2022 was InCharge Energy, Inc. (In-Charge), where, at the time, we increased our ownership to a 60 percent controlling interest, expanding the market presence of our E-mobility business, particularly in the North American market. In-Charge is headquartered in Santa Monica, United States, and is a provider of turn-key commercial electric vehicle charging hardware and software solutions. There were no significant acquisitions in 2023. See “Note 4 - Acquisitions, divestments and equity-accounted companies” to our Consolidated Financial Statements. DIVESTMENTS AND SPIN-OFFS In 2024, together with the Niedax Group, we formed a new joint venture company, Abnex Inc. (Abnex) and contributed our North American cable tray business to Abnex in return for a 50 percent ownership interest. The transaction resulted in a gain of $72 million from the effective sale of our North American cable tray business and a separate acquisition at fair value of 50 percent of Abnex amounting to $124 million and accounted for using the equity method. Prior to its transfer to Abnex the North American cable tray business was part of Electrification Business area. During 2024 we and the noncontrolling shareholders of In - Charge, mutually agreed to terminate our respective put and call options by settling these contracts on a net basis. This agreement resulted in the reduction of our direct ownership in In - Charge to approximately 46 percent. This transaction was treated similar to that of a business divestment, resulting in a loss of $88 million in connection with the loss of control, and a separate acquisition at fair value of the 46 percent investment (amounting to $69 million) accounted for using the equity method. In July 2023, we completed the sale of our Power Conversion Division to AcBel Polytech Inc. for cash proceeds of $496 million, net of transaction costs and cash disposed, and recognized a net gain on sale of $59 million. Prior to its disposal, the Power Conversion Division was part of our Electrification Business area. In connection with the divestment of our Power Grids business (Hitachi Energy) to Hitachi Ltd in 2020 (see “Note 3 - Discontinued operations”), ABB initially retained a 19.9 percent interest in the business until 2022, when we agreed with Hitachi that we would sell our remaining investment in Hitachi Energy and concurrently settle certain outstanding contractual obligations relating to the initial sale of the business, including certain indemnification guarantees (see Note “15 - Commitments and contingencies”). The transaction was completed in December 2022, and we received proceeds of $1,552 million. Spin-off of the Turbocharging Division In 2022, the shareholders approved the spin-off of our Turbocharging Division into an independent, publicly traded company, Accelleron Industries AG (Accelleron), which was completed through the distribution of common stock of Accelleron to the stockholders of ABB on October 3, 2022. As a result of the spin-off of this Division, we distributed net assets of $272 million, net of amounts attributable to noncontrolling interests of $12 million, which was reflected as a reduction in Retained earnings. In addition, total accumulated comprehensive income of $95 million, including the cumulative translation adjustment, was reclassified to Retained earnings. Cash and cash equivalents distributed with Accelleron was $172 million. Prior to being spun- off, the Turbocharging Division was part of our Process Automation Business area. For more information on the above transactions, see “Note 4 - Acquisitions, divestments and equity-accounted companies” to our Consolidated Financial Statements. FINANCIAL REPORT 2024 23 — EXCHANGE RATES We report our financial results in U.S. dollars. Due to our global operations, a significant amount of our revenues, expenses, assets and liabilities are denominated in other currencies. As a consequence, movements in exchange rates between currencies may affect: (i) our profitability, (ii) the comparability of our results between periods and (iii) the reported carrying value of our assets and liabilities. We translate non ‑ USD denominated results of operations, assets and liabilities to USD in our Consolidated Financial Statements. Balance sheet items are translated to USD using year ‑ end currency exchange rates. Income statement and cash flow items are translated to USD using the relevant monthly average currency exchange rate. Increases and decreases in the value of the USD against other currencies will affect the reported results of operations in our Consolidated Income Statements and the value of certain of our assets and liabilities in our Consolidated Balance Sheets, even if our results of operations or the value of those assets and liabilities have not changed in their original currency. As foreign exchange rates impact our reported results of operations and the reported value of our assets and liabilities, changes in foreign exchange rates could significantly affect the comparability of our reported results of operations between periods and result in significant changes to the reported value of our assets, liabilities and stockholders’ equity. While we operate globally and report our financial results in USD, exchange rate movements between the USD and the EUR, the CNY and the CHF are of particular importance to us due to (i) the location of our significant operations and (ii) our corporate headquarters being in Switzerland. The exchange rates between the USD and the EUR, the USD and the CHF and the USD and the CNY at December 31, 2024, 2023 and 2022, were as follows: Exchange rates into $ 2024 2023 2022 EUR 1.00 1.04 1.11 1.07 CHF 1.00 1.10 1.20 1.08 CNY 1.00 0.14 0.14 0.14 The average exchange rates between the USD and the EUR, the USD and the CHF and the USD and the CNY for the years ended December 31, 2024, 2023 and 2022, were as follows: Exchange rates into $ 2024 2023 2022 EUR 1.00 1.08 1.08 1.05 CHF 1.00 1.14 1.11 1.05 CNY 1.00 0.14 0.14 0.15 When we incur expenses that are not denominated in the same currency as the related revenues, foreign exchange rate fluctuations could affect our profitability. To mitigate the impact of exchange rate movements on our profitability, it is our policy to enter into forward foreign exchange contracts to manage the foreign exchange transaction risk of our operations. 24 FINANCIAL REPORT 2024 In 2024, approximately 72 percent of our consolidated revenues were reported in currencies other than the USD. The following percentages of consolidated revenues were reported in the following currencies: • Euro, approximately 23 percent, and • Chinese renminbi, approximately 13 percent. In 2024, approximately 72 percent of our cost of sales and selling, general and administrative expenses were reported in currencies other than the USD. The following percentages of consolidated cost of sales and selling, general and administrative expenses were reported in the following currencies: • Euro, approximately 21 percent, and • Chinese renminbi, approximately 11 percent. We also incur expenses other than cost of sales and selling, general and administrative expenses in various currencies. The results of operations and financial position of our subsidiaries outside of the U.S. are generally accounted for in the currencies of the countries in which those subsidiaries are located. We refer to these currencies as “local currencies”. Local currency financial information is then translated into USD at applicable exchange rates for inclusion in our Consolidated Financial Statements. The discussion of our results of operations below provides certain information with respect to orders, revenues, income from operations and other measures as reported in USD (as well as in local currencies). We measure period ‑ to ‑ period variations in local currency results by using a constant foreign exchange rate for all periods under comparison. Differences in our results of operations in local currencies as compared to our results of operations in USD are caused exclusively by changes in currency exchange rates. While we consider our results of operations as measured in local currencies to be a significant indicator of business performance, local currency information should not be relied upon to the exclusion of U.S. GAAP financial measures. Instead, local currencies reflect an additional measure of comparability and provide a means of viewing aspects of our operations that, when viewed together with the U.S. GAAP results, provide a more complete understanding of factors and trends affecting the business. As local currency information is not standardized, it may not be possible to compare our local currency information to other companies’ financial measures that have the same or a similar title. We encourage investors to review our financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. — ORDERS Our policy is to book and report an order when a binding contractual agreement has been concluded with a customer covering, at a minimum, the price and scope of products or services to be supplied, the delivery schedule and the payment terms. The reported value of an order corresponds to the undiscounted value of revenues that we expect to recognize following delivery of the goods or services subject to the order, less any trade discounts and excluding any value added or sales tax. The value of orders received during a given period of time represents the sum of the value of all orders received during the period, adjusted to reflect the aggregate value of any changes to the value of orders received during the period and orders existing at the beginning of the period. These adjustments, which may in the aggregate increase or decrease the orders reported during the period, may include changes in the estimated order price up to the date of contractual performance, changes in the scope of products or services ordered and cancellations of orders. The undiscounted value of future revenues we expect to generate from our orders at any point in time is represented by our order backlog. FINANCIAL REPORT 2024 25 The level of orders fluctuates from year to year. Portions of our business involve orders for long ‑ term projects that can take months or years to complete and many larger orders result in revenues in periods after the order is booked. Consequently, the level of orders generally cannot be used to accurately predict future revenues or operating performance. Orders that have been placed can often be cancelled, delayed or modified by the customer. These actions can reduce or delay any future revenues from the order or may result in the elimination of the order. — PERFORMANCE MEASURES We evaluate the performance of our operating segments based on orders received, revenues and Operational EBITA. Operational EBITA represents income from operations excluding: • amortization expense on intangibles arising upon acquisitions (acquisition-related amortization), • restructuring, related and implementation costs, • changes in the amount recorded for obligations related to divested businesses occurring after the divestment date (changes in obligations related to divested businesses), • gains and losses from sale of businesses (including fair value adjustment on assets and liabilities held for sale, if any), • acquisition- and divestment-related expenses and integration costs, • certain other non-operational items, as well as • foreign exchange/commodity timing differences in income from operations consisting of: (a) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (b) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (c) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities). Certain other non-operational items generally includes: certain regulatory, compliance and legal costs, certain asset write downs/impairments and certain other fair value changes, as well as other items which are determined by management on a case-by-case basis. See “Note 24 - Operating segment and geographic data” to our Consolidated Financial Statements for a reconciliation of the total Operational EBITA to income from continuing operations before taxes. 26 FINANCIAL REPORT 2024 — TRANSACTIONS WITH AFFILIATES AND ASSOCIATES In the normal course of our business, we purchase products from, sell products to and engage in other transactions with entities in which we hold an equity interest. The amounts involved in these transactions are not material to ABB Ltd. Prior to its sale in December 2022, our most significant equity method investment was in Hitachi Energy Ltd (see “Note 4 - Acquisitions, divestments and equity-accounted companies” for details). Also, in the normal course of our business, we engage in transactions with businesses that we have divested. We believe that the terms of the transactions we conduct with these companies are negotiated on an arm’s length basis. FINANCIAL REPORT 2024 27 — ANALYSIS OF RESULTS OF OPERATIONS The discussion in the following sections below provides a comparative analysis between 2024 and 2023. See the sections under “Operating and Financial Review and Prospects” in our Financial Report 2023 for a comparative discussion and analysis between 2023 and 2022. Our consolidated results from operations were as follows: INCOME STATEMENT DATA: ($ in millions, except per share data in $) 2024 2023 2022 Revenues 32,850 32,235 29,446 Cost of sales (20,576) (21,021) (19,736) Gross profit 12,274 11,214 9,710 Selling, general and administrative expenses (5,708) (5,543) (5,132) Non-order related research and development expenses (1,469) (1,317) (1,166) Other income (expense), net (26) 517 (75) Income from operations 5,071 4,871 3,337 Interest and dividend income 206 165 72 Interest and other finance expense (99) (275) (130) Non-operational pension (cost) credit 55 17 115 Income tax expense (1,278) (930) (757) Income from continuing operations, net of tax 3,955 3,848 2,637 Loss from discontinued operations, net of tax (3) (24) (43) Net income 3,952 3,824 2,594 Net income attributable to noncontrolling interests and redeemable noncontrolling interests (17) (79) (119) Net income attributable to ABB 3,935 3,745 2,475 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 3,937 3,769 2,517 Loss from discontinued operations, net of tax (2) (24) (42) Net income 3,935 3,745 2,475 Basic earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.14 2.03 1.33 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.02 1.30 Diluted earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.13 2.02 1.32 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.01 1.30 A more detailed discussion of the orders, revenues, income from operations and Operational EBITA for our Business areas follows in the sections of “Business analysis” below for Electrification, Motion, Process Automation, Robotics & Discrete Automation, and Corporate and Other. Orders and revenues of our businesses include intersegment transactions which are eliminated in the “Corporate and Other” line in the tables below. 28 FINANCIAL REPORT 2024 ORDERS % Change ($ in millions) 2024 2023 2022 2024 2023 Electrification 16,422 15,189 15,182 8% 0% Motion 7,989 8,222 7,896 (3)% 4% Process Automation 7,106 7,535 6,825 (6)% 10% Robotics & Discrete Automation 2,596 3,066 4,116 (15)% (26)% Total Business areas 34,113 34,012 34,019 0% 0% Corporate and Other E-mobility, Non-core and divested businesses 503 720 787 (30)% (9)% Intersegment eliminations (926) (914) (818) n.a. n.a. Total 33,690 33,818 33,988 0% (1)% In 2024, total orders remained stable compared to the previous year (increasing 1 percent in local currencies). The Electrification Business area saw strong order growth across most consumer segments, with particularly high demand from data centers and utilities. Orders in the Motion Business area decreased slightly as orders in long-cycle businesses declined against a high comparable while orders from short-cycle businesses were flat. Orders in the Process Automation Business area decreased compared to 2023, which included a significant amount for large orders. However, underlying order demand in 2024 was strong in the marine and ports consumer segments as well as in low-carbon segments. Orders in the Robotics & Discrete Automation Business area declined sharply, led by the Machine Automation Division, as customers continued to adjust their order patterns after a period of pre-buys in response to weakened demand, particularly in industrial automation. For additional information about individual Business area order performance, refer to the relevant sections of “Business analysis” below. We determine the geographic distribution of our orders based on the location of the ultimate destination of the products’ end-use, if known, or the location of the customer. The geographic distribution of our consolidated orders was as follows: % Change ($ in millions) 2024 2023 2022 2024 2023 Europe 11,454 11,458 11,778 0% (3)% The Americas 12,110 12,437 11,825 (3)% 5% of which: United States 8,978 9,204 8,920 (2)% 3% Asia, Middle East and Africa 10,126 9,923 10,385 2% (4)% of which: China 3,952 4,488 5,087 (12)% (12)% Total 33,690 33,818 33,988 0% (1)% In 2024, orders decreased 3 percent in the Americas (2 percent in local currencies), driven mainly by the recording of two large orders in the U.S. totaling $435 million in 2023. Despite this impact, underlying demand in 2024 remained strong in the United States. Orders also decreased in Canada and Mexico, partially offset by strong growth in Brazil. In Europe, orders were flat (flat in local currencies). Orders were higher in Germany, Sweden, Finland and the Netherlands while they declined in Italy, Norway and the United Kingdom. In Asia, Middle East and Africa, orders increased 2 percent (5 percent in local currencies). Orders declined in China but were more than offset by strong order growth in markets such as Australia, Japan and the United Arab Emirates. FINANCIAL REPORT 2024 29 ORDER BACKLOG % Change December 31, ($ in millions) 2024 2023 2022 2024 2023 Electrification 7,506 6,808 6,404 10% 6% Motion 5,239 5,343 4,726 (2)% 13% Process Automation 7,437 7,519 6,229 (1)% 21% Robotics & Discrete Automation 1,447 2,141 2,679 (32)% (20)% Total Business areas 21,629 21,811 20,038 (1)% 9% Corporate and Other E-mobility, Non-core and divested businesses 359 508 552 (29)% (8)% Intersegment eliminations (767) (752) (723) n.a. n.a. Total 21,221 21,567 19,867 (2)% 9% At December 31, 2024, consolidated order backlog was 2 percent lower (4 percent higher in local currencies) compared to December 31, 2023. The order backlog declined primarily due to movements in foreign currencies. In local currencies, order backlog increased in all Business areas except Robotics & Discrete Automation. The order backlog in the Electrification Business area was driven by order growth in the Smart Power and Service Divisions while the order backlog in the Motion Business area increased in the Traction and IEC LV Motors Divisions. The increase in the order backlog in the Process Automation Business area was driven by the Marine & Ports and Energy Industries Divisions, where orders continued to outpace revenues. This was partially offset by the decrease in order backlog in the Robotics & Discrete Automation Business area which was a result of the decline in orders in both divisions, as well as the negative impact of a customer outreach performed to confirm the existing order backlog following a period of significant customer pre-ordering. REVENUES % Change ($ in millions) 2024 2023 2022 2024 2023 Electrification 15,448 14,584 13,619 6% 7% Motion 7,787 7,814 6,745 0% 16% Process Automation 6,756 6,270 6,044 8% 4% Robotics & Discrete Automation 3,213 3,640 3,181 (12)% 14% Total Business areas 33,204 32,308 29,589 3% 9% Corporate and Other E-mobility, Non-core and divested businesses 558 769 653 (27)% 18% Intersegment eliminations (912) (842) (796) n.a. n.a. Total 32,850 32,235 29,446 2% 9% In 2024, revenues increased by 2 percent (3 percent in local currencies), primarily driven by volume growth, with additional support from pricing adjustments. Strong execution of our order backlog into revenue supported growth, driven by the Process Automation and Electrification Business areas, with the latter also positively impacted by increased short-cycle demand. Revenue was broadly stable in the Motion Business area with positive impacts from pricing offset by volume declines in the short-cycle businesses. In the Robotics & Discrete Automation Business area, as well as the E-mobility Division, revenues declined sharply as underlying markets remained weak, consistent with the with the slowdown in orders. For additional analysis of revenues for each of the Business areas, refer to the relevant sections of “Business analysis” below. 30 FINANCIAL REPORT 2024 We determine the geographic distribution of our revenues based on the location of the ultimate destination of the products’ end use, if known, or the location of the customer. The geographic distribution of our consolidated revenues was as follows: % Change ($ in millions) 2024 2023 2022 2024 2023 Europe 11,119 11,568 10,285 (4)% 12% The Americas 11,805 11,090 9,573 6% 16% of which: United States 8,879 8,248 7,023 8% 17% Asia, Middle East and Africa 9,926 9,577 9,588 4% 0% of which: China 4,296 4,468 4,696 (4)% (5)% Total 32,850 32,235 29,446 2% 9% In 2024, revenues increased 6 percent in the Americas (7 percent in local currencies), where revenues in the United States increased 8 percent (8 percent in local currencies). Revenues in the Americas also experienced strong growth in Canada and Chile. In Europe, revenues declined 4 percent (4 percent in local currencies). Revenues were higher in Switzerland, Norway, Spain and the United Kingdom while they declined in Germany, Italy and Sweden. In Asia, Middle East and Africa, revenues increased 4 percent (7 percent in local currencies) compared to 2023. Revenues grew in India, Saudi Arabia, Australia and Singapore, partially offset by a decline in China of 4 percent (2 percent in local currencies). COST OF SALES Cost of sales consists primarily of labor, raw materials and component costs but also includes indirect production costs, expenses for warranties, contract and project charges, as well as order-related development expenses incurred in connection with projects for which corresponding revenues have been recognized. In 2024, costs of sales decreased 2 percent (1 percent in local currencies) to $20,576 million. Cost of sales as a percentage of revenues decreased to 62.6 percent from 65.2 percent in 2023. In 2024, the gross margin increased in three out of four Business areas, led by the Electrification Business area. The increase in the gross margin was primarily due to improved operational efficiency from cost mitigation actions taken as well as positive impact from pricing. In the Motion Business area, there was strong growth mainly due to structural improvements in the long - cycle businesses. The Process Automation Business area also improved, driven primarily by the execution of the order backlog, which had a more favorable gross margin. The gross margin in the Robotics & Discrete Automation Business area was broadly stable compared to 2023, negatively impacted by lower volumes driving under absorption of fixed costs in the latter half of the year, primarily in the Machine Automation Division. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES The components of selling, general and administrative expenses were as follows: ($ in millions) 2024 2023 2022 Selling expenses 3,554 3,415 3,248 General and administrative expenses 2,154 2,128 1,884 Total 5,708 5,543 5,132 In 2024, general and administrative expenses increased 1 percent (2 percent in local currencies) compared to 2023, in line with the increase in revenues. As a percentage of revenues, general and administrative expenses remained stable at 6.6 percent compared to 2023. General and administrative expenses in 2024 also includes the ongoing costs required to deliver services to Hitachi Energy Ltd under transition services agreements for which we are compensated. We have recorded $45 million in Other income (expense), net, during 2024 compared to $121 million in 2023 related to these agreements with Hitachi Energy. In 2024, selling expenses increased 4 percent (5 percent in local currencies) compared to 2023 and was higher in all Business areas except for Robotics & Discrete Automation. Selling expenses as a percentage of orders increased from 10.1 percent in 2023 to 10.5 percent in 2024. FINANCIAL REPORT 2024 31 NON‑ORDER RELATED RESEARCH AND DEVELOPMENT EXPENSES In 2024, non ‑ order related research and development expenses increased 12 percent (13 percent in local currencies) compared to 2023. In 2024, non ‑ order related research and development expenses as a percentage of revenues increased (4.5 percent in 2024 compared to 4.1 percent in 2023) as we continued to execute on the plan to further invest in research and development. All four Business areas contributed to the increase in non-order related research and development expenses, led by the Motion and Process Automation Business areas. OTHER INCOME (EXPENSE), NET ($ in millions) 2024 2023 2022 Income from provision of services under transition services agreements 77 175 221 Net gain from sale of property, plant and equipment 60 116 84 Gain (loss) from change in fair value of investments in equity securities (95) 3 52 Brand income from Hitachi Energy 17 39 57 Fair value adjustments on assets and liabilities held for sale (113) — — Net gain from sale of businesses and equity-accounted investments (1) 57 101 36 Asset impairments (27) (49) (55) Income (loss) from equity-accounted companies (21) (16) (102) Restructuring and restructuring-related expenses (2) (56) (20) (227) Regulatory penalties in connection with Kusile project — — (313) Other income (expense) 75 168 172 Total (26) 517 (75) (1) 2022 includes gain on sale of the remaining 19.9 percent investment in Hitachi Energy Ltd. (2) Excluding asset impairments In 2024, Other income (expense), net, was a loss of $26 million compared to a gain of $517 million in 2023. A key reason for the change was that, in 2024, we recorded fair value adjustments of $113 million relating to various businesses held for sale, the largest of which was for In-Charge. We also recorded higher losses for fair value changes in various equity investments compared to gains in 2023. In addition, the conclusion and winding down of a number of transition services agreements in 2024 resulted in a decrease in the income arising from the provision of these services compared to 2023. In 2024, we also had lower gains from sale of property, plant and equipment. INCOME FROM OPERATIONS % Change ($ in millions) 2024 2023 2022 2024 2023 Electrification 3,362 2,800 2,140 20% 31% Motion 1,400 1,390 1,092 1% 27% Process Automation 974 947 663 3% 43% Robotics & Discrete Automation 183 446 247 (59)% 81% Total Business areas 5,919 5,583 4,142 6% 35% Corporate and Other (846) (711) (804) n.a. n.a. Intersegment elimination (2) (1) (1) n.a. n.a. Total 5,071 4,871 3,337 4% 46% In 2024 and 2023, changes in income from operations were a result of the factors discussed above and in “Business analysis” below. FINANCIAL INCOME AND EXPENSES Financial income and expenses include Interest and dividend income and Interest and other finance expense. 32 FINANCIAL REPORT 2024 Interest and other finance expense includes interest expense on our debt, the amortization of upfront transaction costs associated with long ‑ term debt and committed credit facilities, commitment fees on credit facilities, foreign exchange gains and losses on financial items, and gains and losses on marketable securities. In addition, interest costs relating to uncertain tax positions are included within interest expense. ($ in millions) 2024 2023 2022 Interest and dividend income 206 165 72 Interest and other finance expense (99) (275) (130) In 2024, Interest and other finance expense decreased significantly while Interest and dividend income increased modestly. A higher average U.S. dollar interest rate during 2024 generated higher interest income on cash deposits (which are largely in U.S. dollars) and also higher gains on investments in money market investment funds (included in Interest and other finance expense). We realized considerable foreign exchange losses in 2023 while we only had insignificant amounts in 2024. In addition, due to our internal funding structure and the resulting currency hedging requirements, our Interest and other finance expense reflects more the short-term Swiss franc interest rates than the direct underlying interest costs incurred in the currencies of our external debt, especially the euro, reducing the amount of Interest and other finance expense reported in 2024 by more than half. Our exposure to Swiss franc interest rates (with an offsetting exposure to U.S. dollar and euro rates) increased during 2024 and this change, combined with an increased average spread during the year between Swiss franc and U.S. dollar short-term interest rates, has reduced our Interest and other finance expense compared to 2023. NON-OPERATIONAL PENSION (COST) CREDIT A non-operational pension credit of $55 million was recorded in 2024 compared to a $17 million credit in 2023. The increase in the non-operational pension credit compared to 2023 is primarily due to lower curtailment and settlement costs and lower interest costs on the benefit obligations (see “Note 18 - Employee benefits” to our Consolidated Financial Statements). INCOME TAX EXPENSE ($ in millions) 2024 2023 2022 Income from continuing operations before taxes 5,233 4,778 3,394 Income tax expense (1,278) (930) (757) Effective tax rate for the year 24.4% 19.5% 22.3% In 2024, the effective tax rate increased to 24.4 percent from 19.5 percent in 2023. In 2024, the increase in the effective tax rate was primarily driven by the geographical mix of earnings, resulting in a negative impact of approximately 2 percentage points. The effective tax rate was also positively impacted by favorable reassessments of uncertain tax provisions of approximately 3 percentage points, while in 2023 the respective benefit was approximately 4 percentage points. See “Note 17 - Income taxes” to our Consolidated Financial Statements for additional information. INCOME FROM CONTINUING OPERATIONS, NET OF TAX As a result of the factors discussed above, compared to 2023, Income from continuing operations, net of tax, increased by $107 million to $3,955 million in 2024. FINANCIAL REPORT 2024 33 LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX In 2020, we completed the divestment of 80.1 percent of our former Power Grids business to Hitachi. As a result of the sale, substantially all Power Grids related assets and liabilities have been sold. As this divestment represented a strategic shift that would have a major effect on our operations and financial results, the results of operations for this business were presented as discontinued operations. In addition, we also have retained obligations (primarily for environmental and taxes) related to other businesses disposed or otherwise exited that qualified as discontinued operations. Changes to these retained obligations are also included in Loss from discontinued operations, net of tax. For additional information on the divestment and discontinued operations, see “Note 3 - Discontinued operations” to our Consolidated Financial Statements. NET INCOME ATTRIBUTABLE TO ABB As a result of the factors discussed above, compared to 2023, Net income attributable to ABB increased by $190 million to $3,935 million in 2024. EARNINGS PER SHARE ATTRIBUTABLE TO ABB SHAREHOLDERS (in $) 2024 2023 2022 Basic earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.14 2.03 1.33 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.02 1.30 Diluted earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.13 2.02 1.32 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.01 1.30 Basic earnings per share is calculated by dividing income by the weighted ‑ average number of shares outstanding during the year. Diluted earnings per share is calculated by dividing income by the weighted ‑ average number of shares outstanding during the year, assuming that all potentially dilutive securities were exercised, if dilutive. Potentially dilutive securities comprise outstanding written call options and outstanding options and shares granted subject to certain conditions under our share ‑ based payment arrangements. See “Note 21 - Earnings per share” to our Consolidated Financial Statements. 34 FINANCIAL REPORT 2024 — BUSINESS ANALYSIS ELECTRIFICATION BUSINESS AREA The financial results of our Electrification Business area were as follows: % Change ($ in millions) 2024 2023 2022 2024 2023 Orders 16,422 15,189 15,182 8% 0% Order backlog at December 31, 7,506 6,808 6,404 10% 6% Revenues 15,448 14,584 13,619 6% 7% Income from operations 3,362 2,800 2,140 20% 31% Operational EBITA 3,520 2,937 2,343 20% 25% Orders Approximately two-thirds of the Business area’s orders are for products with short lead times or for service orders; these orders are usually recorded and delivered within a three-month period and thus are generally considered as short-cycle. The remainder is comprised of smaller project orders that require longer lead times, as well as larger solutions requiring engineering and installation. Approximately half of the Business area’s orders are received via third-party distributors. As a consequence, end-customer market data and analysis is based partially on management estimates. In 2024, orders increased 8 percent (9 percent in local currencies) compared to 2023. Order growth was somewhat offset by a negative net impact of 1 percent from acquisitions and divestments, primarily from the divestment of the Power Conversion Division in July 2023, partly offset by the acquisition of the SEAM Group in August 2024. Order growth was strongest in the Smart Power and Service Divisions. From a customer segment perspective, order growth was particularly strong in data centers and utilities. Demand in the buildings segment, the Electrification Business area’s largest end-user segment, also improved, supported by a positive development in the commercial area while the residential market stabilized at a low level. Short-cycle businesses grew faster than project- and systems-related businesses. FINANCIAL REPORT 2024 35 The geographic distribution of orders for our Electrification Business area was as follows: ($ in millions) 2024 2023 2022 Europe 4,926 4,629 4,595 The Americas 7,032 6,567 6,509 of which: United States 5,486 5,001 5,062 Asia, Middle East and Africa 4,464 3,993 4,078 of which: China 1,744 1,815 1,992 Total 16,422 15,189 15,182 In 2024, orders increased in all regions. Orders increased 12 percent in Asia, Middle East and Africa (16 percent in local currencies) as strong growth in markets such as India, Australia and the United Arab Emirates more than offset a lower level of orders in China and South Korea. Orders in Europe increased 6 percent (6 percent in local currencies) with growth in markets such as Germany, Belgium, the Netherlands and Sweden. Orders in the Americas increased 7 percent (8 percent in local currencies) with strong growth in the United States. Order backlog In 2024, the order backlog increased 10 percent (15 percent in local currencies). The order backlog growth was led by the Smart Power Division and mainly reflected an increase in the Division’s long-cycle businesses. Revenues In 2024, revenues increased 6 percent (7 percent in local currencies) compared to 2023. The revenue growth was offset partially by a negative net impact of 2 percent from acquisitions and divestments mentioned above. Revenues grew in four out of our five divisions, led by the Smart Power Division, supported by strong order backlog execution combined with high demand, particularly in the data centers and utilities customer segments. Additionally, expanded capacity for medium-voltage switchgear and the resulting lead time reductions contributed to the revenue increase in the Distribution Solution Division. Overall, pricing actions taken to mitigate increasing material and labor costs also had a positive impact on the revenue growth in 2024. The geographic distribution of revenues for our Electrification Business area was as follows: ($ in millions) 2024 2023 2022 Europe 4,665 4,641 4,318 The Americas 6,622 5,968 5,181 of which: United States 5,150 4,480 3,791 Asia, Middle East and Africa 4,161 3,975 4,120 of which: China 1,795 1,797 1,969 Total 15,448 14,584 13,619 In 2024, revenues in the Americas increased 11 percent (12 percent in local currencies) despite the divestment of the Power Conversion Division, which had a large market presence in the Americas and negatively impacted growth in the region by 3 percent. This was only partly offset by the newly acquired SEAM Group, which contributed less than half a percentage point to the Americas region growth. Revenues increased 5 percent (8 percent in local currencies) in Asia, Middle East and Africa as strong growth in markets such as India, Australia and Singapore more than offset a lower level of revenues in markets such as South Korea and Egypt, while revenues in China were stable. Revenues in Europe increased 1 percent (flat in local currencies) with a mixed picture across countries, as strength in markets like the United Kingdom and Ireland was offset by weakness in markets such as the Netherlands and Türkiye. 36 FINANCIAL REPORT 2024 Income from operations In 2024, Income from operations increased 20 percent, mainly driven by higher volumes and higher operating margins. Restructuring-related expenses and implementation costs were lower than the previous year as right-sizing actions commencing in 2023 neared completion. Benefits of savings realized from these ongoing restructuring and cost savings programs also positively influenced income from operations. Additionally, pricing actions helped to partly offset the adverse impact of inflation, primarily in salary and labor costs. The positive effects were dampened by higher personnel expenses to support business growth. The level of non-order related research and development spending was higher in 2024 in line with our commitment to ensure a stable investment level relative to revenues. Our increased research and development spend focused on growth initiatives, including data center offerings, an enhanced service portfolio, market localization, as well as investments in sustainable products and renewable energy solutions. Changes in foreign currencies, including the impacts from FX/commodity timing differences summarized in the table below, negatively impacted income from operations in 2024 by 2 percent. Operational EBITA The reconciliation of Income from operations to Operational EBITA for the Electrification Business area was as follows: ($ in millions) 2024 2023 2022 Income from operations 3,362 2,800 2,140 Acquisition-related amortization 94 88 104 Restructuring, related and implementation costs 27 76 28 Changes in obligations related to divested businesses — 1 1 Gains and losses from sale of businesses (73) (75) (1) Fair value adjustment on assets and liabilities held for sale 25 — — Acquisition- and divestment-related expenses and integration costs 38 30 36 Certain other non-operational items 7 16 41 FX/commodity timing differences in income from operations 40 1 (6) Operational EBITA 3,520 2,937 2,343 In 2024, Operational EBITA increased 20 percent (21 percent excluding the impact from changes in foreign currency exchange rates) compared to 2023, primarily due to the reasons described under “Income from operations”, excluding the explanations related to the reconciling items in the table above. FINANCIAL REPORT 2024 37 MOTION BUSINESS AREA The financial results of our Motion Business area were as follows: % Change ($ in millions) 2024 2023 2022 2024 2023 Orders 7,989 8,222 7,896 (3)% 4% Order backlog at December 31, 5,239 5,343 4,726 (2)% 13% Revenues 7,787 7,814 6,745 0% 16% Income from operations 1,400 1,390 1,092 1% 27% Operational EBITA 1,518 1,475 1,163 3% 27% Orders In 2024, orders were slightly lower from last year’s high level, decreasing 3 percent (2 percent in local currencies) compared to 2023. The decline in orders was driven by the System Drives Division, partly offset by order growth in the Service Division. Long-cycle orders declined from last year's elevated levels, which included a significant share of large orders. Orders in short-cycle businesses were flat, with positive momentum in heating, ventilation, air conditioning and refrigeration (HVACR) related sub-segments, despite challenges in the China market. Strong performance in the power generation segment was offset by third-party order decreases in heavy, process-related industries such as chemical, oil & gas, metals, pulp and paper, cement and mining. The geographic distribution of orders for our Motion Business area was as follows: ($ in millions) 2024 2023 2022 Europe 2,688 2,797 2,710 The Americas 2,545 2,715 2,583 of which: United States 2,010 2,186 2,128 Asia, Middle East and Africa 2,756 2,710 2,603 of which: China 1,217 1,300 1,314 Total 7,989 8,222 7,896 In 2024, orders decreased 4 percent (5 percent in local currencies) in Europe. Volume dropped particularly in Germany, Norway, the United Kingdom and Spain, partly offset by order growth in Finland, Sweden, Austria and Italy. In Asia, Middle East and Africa, orders increased 2 percent (4 percent in local currencies) supported by large orders in Australia and the United Arab Emirates, while orders in China and India declined. In the Americas, orders decreased 6 percent (6 percent in local currencies) driven by the United States, which declined versus last year's high comparable that included a significant share of large orders. This was partly offset by order growth in Canada. 38 FINANCIAL REPORT 2024 Order backlog Order backlog of $5.2 billion at the end of 2024 decreased 2 percent (increased 4 percent in local currencies) compared to 2023. In local currencies, the order backlog increased in the Traction and IEC LV Motors Divisions, partially offset by a decline in the System Drives Division due to strong order backlog execution. Revenues In 2024, revenues remained flat (increased 1 percent in local currencies) compared to 2023. The positive impact from pricing was largely offset by volume declines in the short-cycle divisions. Revenue growth was strong in the Service Division, as well as in the System Drives and Large Motors & Generators Divisions which were able to effectively execute on the high order backlog. This was mostly offset by a decline in the Drive Products Division. The geographic distribution of revenues for our Motion Business area was as follows: ($ in millions) 2024 2023 2022 Europe 2,514 2,704 2,271 The Americas 2,699 2,650 2,208 of which: United States 2,173 2,176 1,823 Asia, Middle East and Africa 2,574 2,460 2,266 of which: China 1,238 1,256 1,245 Total 7,787 7,814 6,745 In 2024, revenues in Europe decreased 7 percent (8 percent in local currencies) compared to 2023. The revenue decrease was driven by Germany, Italy, Türkiye and France, partly offset by revenue growth in Switzerland, Spain and Austria. In Asia, Middle East and Africa, revenues increased 5 percent (8 percent in local currencies) supported by strong growth in India and the United Arab Emirates, while China decreased by 1 percent (flat in local currencies). In the Americas, revenues increased 2 percent (2 percent in local currencies) driven by revenue increases in Mexico and Canada, while the United States remained flat. Income from operations In 2024, income from operations increased 1 percent (2 percent in local currencies) supported by stable revenues and continued cost discipline. The decline in the short-cycle business and higher research and development and selling, general, and administrative expenses, primarily due to the increased cost of labor, were more than offset by structural profitability improvements in the long-cycle business. The profitability improvement was driven by the Service Division as a result of both increased revenues and margin. Changes in foreign currencies, including the impacts from FX/commodity timing differences summarized in the table below, negatively impacted income from operations by approximately 4 percent. Operational EBITA The reconciliation of Income from operations to Operational EBITA for the Motion Business area was as follows: ($ in millions) 2024 2023 2022 Income from operations 1,400 1,390 1,092 Acquisition-related amortization 35 35 31 Restructuring, related and implementation costs 39 46 16 Gains and losses from sale of businesses — — 8 Acquisition- and divestment-related expenses and integration costs 5 17 15 Certain other non-operational items 7 6 — FX/commodity timing differences in income from operations 32 (19) 1 Operational EBITA 1,518 1,475 1,163 In 2024, Operational EBITA increased 3 percent (3 percent excluding the impact from changes in foreign currency exchange rates) compared to 2023, primarily due to the reasons described under “Income from operations”, excluding the explanations related to the reconciling items in the table above. FINANCIAL REPORT 2024 39 PROCESS AUTOMATION BUSINESS AREA The financial results of our Process Automation Business area were as follows: % Change ($ in millions) 2024 2023 2022 2024 2023 Orders 7,106 7,535 6,825 (6)% 10% Order backlog at December 31, 7,437 7,519 6,229 (1)% 21% Revenues 6,756 6,270 6,044 8% 4% Income from operations 974 947 663 3% 43% Operational EBITA 1,025 909 848 13% 7% Orders In 2024, orders decreased by 6 percent (5 percent in local currencies) compared to 2023 as the previous year reflected certain large orders while in the current year, underlying demand remained robust. The Marine & Ports Division recorded two large orders in 2023 totaling $435 million leading to a decline in 2024, however, underlying demand in the Division continues to be strong. Orders also declined in the Process Industries Division. The Measurement & Analytics Division experienced growth in orders as short-cycle demand strengthened throughout the year. Positive trends were observed in low-carbon segments such as nuclear, carbon capture and hydrogen. However, orders were lower in large process-related segments including oil & gas, pulp and paper, and mining. The geographic distribution of orders for our Process Automation Business area was as follows: ($ in millions) 2024 2023 2022 Europe 2,879 2,662 2,361 The Americas 1,876 2,441 1,994 of which: United States 1,079 1,506 1,201 Asia, Middle East and Africa 2,351 2,432 2,470 of which: China 620 729 748 Total 7,106 7,535 6,825 Orders in Europe increased 8 percent (8 percent in local currencies). Orders increased in Germany, Finland and the Netherlands. Orders in Asia, Middle East and Africa decreased 3 percent (1 percent in local currencies). Higher orders in Australia and the United Arab Emirates were more than offset by lower order volumes in China, India and Saudi Arabia. In the Americas, orders decreased 23 percent (22 percent in local currencies) driven by a decrease in the U.S and Canada, with the former impacted by the two large orders referred to above. This was partially offset by higher orders in Mexico and Brazil. 40 FINANCIAL REPORT 2024 Order backlog In 2024, order backlog decreased 1 percent (increased 5 percent in local currencies) compared to 2023, due to movements in foreign currencies. In local currencies, the increase in order backlog is driven by increases in the Energy Industries and Marine & Ports Divisions, where orders continue to outpace revenues. Revenues In 2024, revenues increased 8 percent (9 percent in local currencies) compared to 2023. Revenues increased in all divisions, reflecting strong execution of the order backlog, as well as positive developments in the service business, led by the Marine & Ports Division. The geographic distribution of revenues for our Process Automation Business area was as follows: ($ in millions) 2024 2023 2022 Europe 2,460 2,311 2,266 The Americas 1,879 1,741 1,569 of which: United States 1,160 1,077 943 Asia, Middle East and Africa 2,417 2,218 2,209 of which: China 698 696 680 Total 6,756 6,270 6,044 Revenues in 2024 were 8 percent higher (9 percent in local currencies) in the Americas, 9 percent higher (11 percent in local currencies) in Asia, Middle East and Africa and 6 percent higher (7 percent in local currencies) in Europe compared to 2023. In the Americas, revenue growth was driven by the U.S. and Canada. In Asia, Middle East and Africa, revenues increased in India, Singapore and Saudi Arabia and revenues declined in Japan, while revenues in China were stable. In Europe, growth was reported in key markets including Norway, Italy and the United Kingdom, partially offset by lower revenues in Sweden and Germany. Income from operations In 2024, income from operations increased 3 percent compared to 2023, driven by strong business performance in most divisions. Growth was driven primarily by higher revenues on the execution of the order backlog, which has a more favorable gross margin. This more than offset the impact of higher selling, general and administrative and non-order related research and development expenses. Changes in foreign currencies, including the effect from changes in the FX/commodity timing differences summarized in the table below, negatively impacted income from operations by approximately 3 percent. Operational EBITA The reconciliation of Income from operations to Operational EBITA for the Process Automation Business area was as follows: ($ in millions) 2024 2023 2022 Income from operations 974 947 663 Acquisition-related amortization 10 5 4 Restructuring, related and implementation costs 30 3 29 Gains and losses from sale of businesses — (26) — Acquisition- and divestment-related expenses and integration costs 5 (7) 134 FX/commodity timing differences in income from operations 6 (13) 18 Operational EBITA 1,025 909 848 In 2024, Operational EBITA increased 13 percent (14 percent excluding the impact from changes in foreign currency exchange rates) compared to 2023, primarily due to the reasons described under “Income from operations”, excluding the explanations related to the reconciling items in the table above. FINANCIAL REPORT 2024 41 ROBOTICS & DISCRETE AUTOMATION BUSINESS AREA The financial results of our Robotics & Discrete Automation Business area were as follows: % Change ($ in millions) 2024 2023 2022 2024 2023 Orders 2,596 3,066 4,116 (15)% (26)% Order backlog at December 31, 1,447 2,141 2,679 (32)% (20)% Revenues 3,213 3,640 3,181 (12)% 14% Income from operations 183 446 247 (59)% 81% Operational EBITA 329 536 340 (39)% 58% Orders In 2024, orders decreased 15 percent (15 percent in local currencies) with diverging market environments between the two divisions. In the Machine Automation Division, orders declined as a slowdown in industrial automation demand extended the ongoing alignment of order patterns by machine builders following a period of significant pre-ordering during supply chain disruptions in recent years. The decline in orders further reflects the results of a customer outreach performed to confirm the existing order backlog following the period of significant pre-ordering, accounting for 4 percent of the decrease. Orders also declined in the Robotics Division, with more pronounced declines early in the year, driven by negative developments in electronics and in automotive, with the latter impacted by a slower pace in the EV-related market which outweighed increasing activities linked to hybrids. The overall decline in orders in the Robotics Division was partially offset by growth in the general industry and warehouse logistics segments, linked to consumer industries, during the latter part of the year. The geographic distribution of orders for our Robotics & Discrete Automation Business area was as follows: ($ in millions) 2024 2023 2022 Europe 1,207 1,481 2,043 The Americas 592 544 609 of which: United States 369 335 404 Asia, Middle East and Africa 797 1,041 1,464 of which: China 515 752 1,147 Total 2,596 3,066 4,116 In 2024, orders in Europe decreased 19 percent (19 percent in local currencies) mainly driven by decreased demand in Germany, Italy, Austria and the United Kingdom. Orders in the Americas increased 9 percent (10 percent in local currencies) compared to 2023, driven by strong order growth in the U.S. as well as in both Canada and Brazil, offsetting declines in smaller markets. Orders in Asia, Middle East and Africa decreased 23 percent (21 percent in local currencies) with lower demand mainly in China. The completed customer outreach negatively impacted orders in Asia, Middle East and Africa by 9 percent. 42 FINANCIAL REPORT 2024 Order backlog In 2024, order backlog decreased 32 percent (29 percent in local currencies) compared to 2023. Order backlog decreased in both divisions primarily due to lower order intake and the impact of the customer outreach order confirmation, along with the continued order backlog execution. Revenues In 2024, revenues decreased 12 percent (11 percent in local currencies) compared to 2023. Revenues decreased in both divisions. The decline was primarily driven by a sharp volume decline in the Machine Automation Division due to the slowdown in industrial automation demand. The revenue decline in the Robotics Division was less pronounced as service revenues continued to increase in 2024, mainly linked to the automotive segment. The geographic distribution of revenues for our Robotics & Discrete Automation Business area was as follows: ($ in millions) 2024 2023 2022 Europe 1,656 1,942 1,498 The Americas 536 577 525 of which: United States 330 361 374 Asia, Middle East and Africa 1,021 1,121 1,158 of which: China 705 805 895 Total 3,213 3,640 3,181 Revenues from Asia, Middle East and Africa decreased 9 percent (7 percent in local currencies) compared to 2023 due to lower volumes in China. Revenues in Europe decreased 15 percent (15 percent in local currencies) driven by lower volumes in the short-cycle business, mainly in Austria, Germany, France and the United Kingdom. In the Americas, revenues decreased 7 percent (6 percent in local currencies) due mainly to lower volumes in the United States. Income from operations In 2024, the Business area recorded income from operations of $183 million compared to $446 million in 2023, with both divisions contributing to the lower income level. The operational performance in 2024 reflected lower sales volumes, price pressures and an unfavorable change in the revenue mix, despite the benefit of cost reduction measures put in place in the second half of 2024. The Business area also had higher restructuring costs and costs for certain non-operational items in 2024. Continued inflationary cost pressures, as well as lower production volumes, triggered under absorption of fixed costs, primarily in the Machine Automation Division. Changes in foreign currencies, including the impacts from FX/commodity timing differences summarized in the table below, negatively impacted income from operations by approximately 2 percent. Operational EBITA The reconciliation of Income from operations to Operational EBITA for the Robotics & Discrete Automation Business area was as follows: ($ in millions) 2024 2023 2022 Income from operations 183 446 247 Acquisition-related amortization 54 79 78 Restructuring, related and implementation costs 59 6 11 Acquisition- and divestment-related expenses and integration costs 16 14 6 Certain other non-operational items 14 (10) (8) FX/commodity timing differences in income from operations 3 1 6 Operational EBITA 329 536 340 In 2024, Operational EBITA decreased 39 percent (38 percent excluding the impact from changes in foreign currency exchange rates) compared to 2023, primarily due to the reasons described under “Income from operations”, excluding the explanations related to the reconciling items in the table above. FINANCIAL REPORT 2024 43 CORPORATE AND OTHER Net loss from operations for Corporate and Other was as follows: ($ in millions) 2024 2023 2022 Corporate headquarters and stewardship (413) (557) (430) Fair value adjustment on equity securities (80) (2) (4) Loss from equity-accounted companies (7) (6) (101) Other corporate costs (4) (18) (25) Regulatory penalty in connection with Kusile project — — (313) Net gain from sale of businesses (1) — — 43 Corporate brand income from Hitachi Energy 17 39 57 Corporate real estate 55 103 66 E-mobility Division (445) (234) 19 Divested businesses and other non-core activities 29 (37) (117) Total Corporate and Other (848) (712) (805) (1) 2022 includes gain on sale of the remaining 19.9 percent investment in Hitachi Energy Ltd. In 2024, the net loss from operations within Corporate and Other increased by $136 million to $848 million compared to 2023. The increase is primarily driven by an increase in the net loss from operations in the E-mobility Division as well as a fair value adjustment of an equity investment, partially offset by a decrease in Corporate headquarters and stewardship costs. Corporate In 2024, Corporate headquarters and stewardship costs decreased by $144 million compared to 2023, mainly due to a reduction in estimated self-insurance reserves in 2024. Corporate brand income results from granting the use of the ABB Brand to Hitachi Energy, the fair value of which was initially determined on the date of the divestment of the former Power Grids business in 2020. A portion of the proceeds received for the sale was allocated to the fair value of the granting of the use of the brand and is being amortized over the expected period of benefit received by Hitachi Energy. Corporate real estate primarily includes income and expenses from property rentals and gains from the sale of real estate properties. In 2024, income from operations in corporate real estate included gains from the sale of real estate properties of approximately $55 million compared to $103 million in 2023. Other corporate costs consists of operational costs of Corporate Treasury and other minor items. Other - E-mobility In 2024, the E-mobility Division reported a net loss from operations of $445 million compared to a net loss from operations of $234 million in 2023. The increase is driven by a fair value adjustment on assets held for sale of $88 million related to InCharge Energy, Inc. and combined charges in connection with excess and obsolete components of inventory of $55 million. Additionally, the net loss from operations was further impacted by a significant decrease in revenues of 30 percent (30 percent in local currencies) compared to 2023, primarily driven by a decline in volumes, also resulting in the under absorption of fixed costs and further deterioration of the Division’s gross margin. Despite the decrease in volumes, Selling, general and administrative and Non-order related research and development costs increased, each impacted by a higher cost of labor and the ongoing reorganization to ensure a more focused portfolio. Other - Divested businesses and other non-core activities The results of operations for certain divested businesses and other non ‑ core activities are presented in Corporate and Other. Divested businesses include the high-voltage cables business, steel structures business and the oil & gas EPC business. Other continuing non ‑ core activities include the execution and wind ‑ down of certain legacy EPC and other contracts. In 2024 and 2023, the amounts represent charges and losses relating to divested businesses and the winding down of the remaining EPC projects. We recorded profit of $29 million in 2024, improved from 2023, in which we recorded losses of $37 million, primarily due to the reversal of a provision related to one of our divested businesses based on the favorable resolution of a legal claim. 44 FINANCIAL REPORT 2024 At December 31, 2024, our remaining non ‑ core activities primarily include the completion of the remaining EPC contracts for substations and oil & gas. — LIQUIDITY AND CAPITAL RESOURCES PRINCIPAL SOURCES OF FUNDING We meet our liquidity needs principally using cash from operations, proceeds from the issuance of debt instruments (bonds and commercial paper), and short ‑ term bank borrowings. Our net debt is shown in the table below: December 31, ($ in millions) 2024 2023 Short-term debt and current maturities of long-term debt 293 2,607 Long-term debt 6,652 5,221 Cash and equivalents (4,311) (3,891) Restricted cash - current (15) (18) Marketable securities and short-term investments (1,334) (1,928) Net debt (defined as the sum of the above lines) 1,285 1,991 During 2024, although we continued to return high amounts of cash to shareholders in the form of dividends and purchases of treasury stock, we reduced our net debt (as presented in the table above) driven by continued strong cash from operating activities. During 2024, our net debt decreased $706 million to a net debt position of $1,285 million at December 31, 2024. The effect of exchange rate movements decreased net debt by approximately $200 million. In 2024, we generated cash flows from operating activities of $4,675 million and delivered treasury stock in relation to our employee share plans for $451 million. These items were mostly offset by amounts for purchases of treasury shares of $1,247 million, including $998 million relating to the announced buybacks of our shares, as well as $1,769 million for the payment of the dividend to our shareholders. We made net purchases of property, plant and equipment and intangible assets of $738 million and made payments of dividends to noncontrolling shareholders totaling $103 million. See “Financial position”, “Investing activities” and “Financing activities” for further details. Our Corporate Treasury is responsible for providing a range of treasury management services to our Group companies, including investing cash in excess of current business requirements. At December 31, 2024 and 2023, the proportion of our aggregate Cash and equivalents (including Restricted cash) and Marketable securities and short ‑ term investments managed by Corporate Treasury amounted to approximately 62 percent and 59 percent, respectively. Our investment strategy for cash (in excess of current business requirements) has generally been to invest in short-term time deposits with maturities of less than 3 months, supplemented at times by investments in money market funds and in some cases, government securities. We actively monitor credit risk in our investment and derivative portfolios. Credit risk exposures are controlled in accordance with policies approved by our senior management to identify, measure, monitor and control credit risks. We have minimum rating requirements for our counterparts and closely monitor developments in the credit markets making appropriate changes to our investment policy as deemed necessary. In addition to minimum rating criteria, we have strict investment parameters and specific approved instruments as well as restrictions on the types of investments we make. These parameters are closely monitored on an ongoing basis and amended as we consider necessary. Our cash is held in various currencies around the world. Approximately 55 percent of our cash and equivalents held at December 31, 2024, was in U.S. dollars, while the most significant foreign currency in which cash and equivalents was held was euros (25 percent). FINANCIAL REPORT 2024 45 We believe the ongoing cash flows generated from our business, supplemented, when necessary, through access to the capital markets (including short ‑ term commercial paper) and our credit facilities are sufficient to support business operations, capital expenditures, business acquisitions, the payment of dividends to shareholders and contributions to pension plans. Consequently, we believe that our ability to obtain funding from these sources will continue to provide the cash flows necessary to satisfy our working capital and capital expenditure requirements, as well as meet our debt repayments and other financial commitments for the next 12 months. See “Contractual obligations and commitments”. Due to the nature of our operations, including the timing of annual incentive payments to employees, our cash flow from operations generally tends to be weaker in the first half of the year than in the second half of the year. DEBT AND INTEREST RATES Total outstanding debt was as follows: December 31, ($ in millions) 2024 2023 Short-term debt and current maturities of long-term debt 293 2,607 Long-term debt: Bonds 5,939 5,051 EIB R&D Loan 539 — Other long-term debt 174 170 Total debt 6,945 7,828 In 2024, we repaid bonds having a book value at the end of 2023 of $2,476 million. As the amount of bonds due in 2025 is lower at $166 million, this has significantly reduced the amount of short-term debt. At December 31, 2024, Long-term debt was $1,431 million higher compared to the end of 2023. We issued two new instruments in 2024 which remain classified as Long-term debt at December 31, 2024 (EUR 500 million of 3.125% Instruments due 2029 and EUR 750 million of 3.375% Instruments due 2034). This was only partially offset by the reclassification to current of the CHF 150 million 2.1% Instruments due 2025. Decreases in interest rates also resulted in an increase in our long-term debt of approximately $41 million due to the application of fair value hedge accounting on certain outstanding instruments. We also borrowed the full amount available under our financing arrangement with the European Investment Bank obtaining a 7-year floating-rate term loan of USD 539 million due 2031. Our debt has been obtained in a range of currencies and maturities and with various interest rate terms. For certain of our debt obligations, we use derivatives to manage the fixed interest rate exposure. For example, we use interest rate swaps and cross-currency interest rate swaps to effectively convert fixed rate debt into floating rate liabilities. After considering the effects of interest rate swaps and cross-currency interest rate swaps, at December 31, 2024, the effective average interest rate on our floating rate long-term debt (including current maturities) of $1,807 million and our fixed rate long-term debt (including current maturities) of $5,055 million was 5.0 percent and 2.8 percent, respectively. This compares with an effective rate of 4.8 percent for floating rate long-term debt of $2,907 million and 2.7 percent for fixed rate long-term debt of $4,834 million at December 31, 2023. For a discussion of our use of derivatives to modify the interest characteristics of certain of our individual bond issuances, see “Note 13 - Debt” to our Consolidated Financial Statements. CREDIT FACILITY In December 2019, we replaced our previous multicurrency revolving credit facility with a new $2 billion multicurrency revolving credit facility, maturing in 2024. In 2021, we exercised our option to extend the maturity of this facility to December 2026. No amount was drawn under the facility at December 31, 2024 and 2023. The facility is available for general corporate purposes and contains cross-default clauses whereby an event of default would occur if we were to default on indebtedness, as defined in the facility, at or above a specified threshold. In February 2023, we amended and restated our facility for the purpose of addressing the discontinuation of LIBOR. Under the amended and restated credit facility, the margin is unchanged, but advances in USD are referenced to CME Term SOFR, whilst advances in CHF and GBP are referenced to overnight SARON and SONIA, respectively, and subject to applicable credit adjustment spreads. The credit facility does not contain financial covenants that would restrict our ability to pay dividends or raise additional funds in the capital markets. For further details of the credit facility, see “Note 13 - Debt” to our Consolidated Financial Statements. 46 FINANCIAL REPORT 2024 COMMERCIAL PAPER At December 31, 2024, we had two commercial paper programs in place: • a $2 billion commercial paper program for the private placement of U.S. dollar denominated commercial paper in the United States, and • a $2 billion Euro-commercial paper program for the issuance of commercial paper in a variety of currencies. At December 31, 2024 and 2023, there were no amounts outstanding under either of these two programs. EUROPEAN PROGRAM FOR THE ISSUANCE OF DEBT The European program for the issuance of debt allows the issuance of up to the equivalent of $8 billion in certain debt instruments. The terms of the program do not obligate any third party to extend credit to us and the terms and possibility of issuing any debt under the program are determined with respect to, and as of the date of issuance of, each debt instrument. At December 31, 2024, five bonds (principal amount of EUR 500 million due in 2027, principal amount of EUR 500 million due in 2029, principal amount of EUR 800 million due in 2030, principal amount of EUR 750 million due in 2031, and principal amount of EUR 750 million due in 2034) having a combined carrying amount of $3,318 million were outstanding under the program. The carrying amount of the six bonds outstanding under the program at December 31, 2023, was $4,259 million. CREDIT RATINGS Credit ratings are assessments by the rating agencies of the credit risk associated with ABB and are based on information provided by us or other sources that the rating agencies consider reliable. Higher ratings generally result in lower borrowing costs and increased access to capital markets. Our ratings are of ‘investment grade’ which is defined as Baa3 (or above) from Moody’s and BBB− (or above) from Standard & Poor’s. At December 31, 2024, our long-term debt was rated A2 by Moody’s (with a Stable outlook), compared to A3 at December 31, 2023. At December 31, 2024 our long-term debt was rated A by Standard & Poor’s (with a Stable outlook), compared to A- at December 31, 2023. LIMITATIONS ON TRANSFERS OF FUNDS Currency and other local regulatory limitations related to the transfer of funds exist in a number of countries where we operate or otherwise have bank deposits, including: Argentina, Egypt, India, Indonesia, Malaysia, the Russian Federation, South Africa, South Korea, Thailand, Turkiye and Vietnam. Funds, other than regular dividends, fees or loan repayments, cannot be readily transferred offshore from these countries and are therefore deposited and used for working capital needs in those countries. In addition, there are certain countries where, for tax reasons, it is not considered optimal to transfer the cash offshore. Consequently, these funds are not available within Corporate Treasury to meet short-term cash obligations outside the relevant country. The above-described funds are reported as cash in our Consolidated Balance Sheets, but we do not consider these funds immediately available for the repayment of debt outside the respective countries where the cash is situated, including those described above. At December 31, 2024 and 2023, the balance of Cash and equivalents and Marketable securities and other short-term investments under such limitations (either regulatory or sub-optimal from a tax perspective) totaled $1,578 million and $1,479 million, respectively. During 2024, we continued to direct our subsidiaries in countries with restrictions to place such cash with our core banks or investment grade banks, where possible, in order to minimize credit risk on such cash positions. We continue to closely monitor the situation to ensure bank counterparty risks are minimized. FINANCIAL REPORT 2024 47 — FINANCIAL POSITION BALANCE SHEETS December 31, ($ in millions) 2024 2023 % Change Current assets Cash and equivalents 4,311 3,891 11% Restricted cash 15 18 (17)% Marketable securities and short-term investments 1,334 1,928 (31)% Receivables, net 7,388 7,446 (1)% Contract assets 1,115 1,090 2% Inventories, net 5,859 6,149 (5)% Prepaid expenses 287 235 22% Other current assets 541 520 4% Total current assets 20,850 21,277 (2)% For a discussion on Cash and equivalents, see sections “Liquidity and Capital Resources—Principal sources of funding” and “Cash flows” for further details. Marketable securities and short-term investments decreased in 2024. The change primarily reflects lower amounts placed in money market funds classified as equity securities (see “Note 5 - Cash and equivalents, marketable securities and short-term investments” to our Consolidated Financial Statements). Receivables decreased 1 percent (increased 5 percent in local currencies). In local currencies, the increase in Receivables primarily reflects higher revenues (primarily due to higher business volumes) at the end of 2024 compared to 2023. Contract assets increased 2 percent (9 percent in local currencies), primarily due to the higher level of business activity as well as timing of invoices issued. In local currencies, the increase reflects higher levels in all Business areas. Inventories decreased 5 percent primarily due to movements in foreign currencies. In local currencies, Inventories increased 1 percent, reflecting higher business activity and increased inventory levels in order to fulfill the higher order backlog at the end of 2024 compared to 2023, primarily in the Electrification Business area. December 31, ($ in millions) 2024 2023 % Change Current liabilities Accounts payable, trade 5,036 4,847 4% Contract liabilities 2,969 2,844 4% Short-term debt and current maturities of long-term debt 293 2,607 (89)% Current operating leases 235 249 (6)% Provisions for warranties 1,248 1,210 3% Other provisions 853 1,201 (29)% Other current liabilities 4,582 5,046 (9)% Total current liabilities 15,216 18,004 (15)% Accounts payable, trade, increased 4 percent (10 percent in local currencies) reflecting some increase in average days payable in 2024 compared to 2023, as well as both the increase and timing of inventory purchases late in the year. The increase is driven by the Electrification Business area. 48 FINANCIAL REPORT 2024 Contract liabilities increased 4 percent (11 percent in local currency) primarily due to higher levels of business activity, including progress billings and advances at the end of 2024 compared to 2023. The increase reflects higher levels in all Business areas except Robotics & Discrete Automation. The decrease in short-term debt and current maturities of long-term debt in 2024 reflects the reclassification to current of the CHF 150 million 2.1% Bonds due 2025, being more than offset by the repayment at maturity of the EUR 700 million 0.625% Instruments due 2024, EUR 500 million Floating Rate Instruments due 2024, EUR 750 million 0.75% Instruments due 2024 and the CHF 280 million 0.3% Bonds due 2024, in 2024. Current operating leases includes the portion of the operating lease liabilities that are due to be paid in the next 12 months. For a summary of operating lease liabilities, see “Note 16 - Leases” to our Consolidated Financial Statements. Provisions for warranties increased 3 percent (9 percent in local currencies). The increase primarily reflects the higher provisioning in 2024 on increased revenues. For details on the change in the Provisions for warranties, see “Note 15 - Commitments and contingencies” to our Consolidated Financial Statements. For a breakdown of Other provisions and Other current liabilities, see “Note 13 - Other provisions, other current liabilities and other non-current liabilities” to our Consolidated Financial Statements. December 31, ($ in millions) 2024 2023 % Change Non-current assets Property, plant and equipment, net 4,177 4,142 1% Operating lease right-of-use assets 840 893 (6)% Investments in equity-accounted companies 368 187 97% Prepaid pension and other employee benefits 689 780 (12)% Intangible assets, net 1,048 1,223 (14)% Goodwill 10,555 10,561 0% Deferred taxes 1,341 1,381 (3)% Other non-current assets 489 496 (1)% Total non-current assets 19,507 19,663 (1)% Property, plant and equipment increased 1 percent (6 percent in local currencies) as capital expenditures exceeded the annual depreciation expense. For details on Investments in equity method companies see “Note 4 - Acquisitions, divestments and equity- accounted companies” to our Consolidated Financial Statements. Prepaid pension and other employee benefits decreased 12 percent (5 percent in local currencies). For additional information on Pension and employee benefits see “Note 18 - Employee benefits” to our Consolidated Financial Statements. Intangible assets decreased 14 percent (11 percent in local currencies). The decrease primarily represents the amortization recorded during the year, partially offset by the net impact of acquisitions and divestments, which increased Intangible assets by 6 percent. Goodwill remained flat (increased 2 percent in local currencies) due to the net impact of acquisitions and divestments during the year. For additional information on goodwill and intangible assets see “Note 11 - Goodwill and intangible assets” to our Consolidated Financial Statements. For details on deferred tax assets see “Note 17 - Income taxes” to our Consolidated Financial Statements. December 31, ($ in millions) 2024 2023 % Change Non-current liabilities Long-term debt 6,652 5,221 27% Non-current operating leases 631 666 (5)% Pension and other employee benefits 569 686 (17)% Deferred taxes 675 669 1% Other non-current liabilities 1,554 1,548 0% Total non-current liabilities 10,081 8,790 15% FINANCIAL REPORT 2024 49 Long-term debt increased 27 percent (31 percent in local currencies). The balance at December 31, 2024, includes instruments newly issued in 2024: (i) EUR 500 million of 3.125% Instruments due 2029, and (ii) EUR 750 million of 3.375% Instruments due 2034, as well as the receipt of a USD 539 million Floating rate EIB R&D loan due 2031, pursuant to a financing agreement entered into in 2023 with the European Investment Bank (EIB). The increase was partially offset by the reclassification to current of the CHF 150 million 2.1% Bonds due 2025. For additional information on Long-term debt, see “Liquidity and Capital Resources—Debt and interest rates” as well as “Note 13 - Debt” to our Consolidated Financial Statements. Non-current operating leases includes the portion of the operating lease liabilities that are due to be paid in more than 12 months. Pension and employee benefits decreased 17 percent (12 percent in local currencies). For additional information on Pension and employee benefits see “Note 18 - Employee benefits” to our Consolidated Financial Statements. For a breakdown of Other non ‑ current liabilities, see “Note 14 - Other provisions, other current liabilities and other non-current liabilities” to our Consolidated Financial Statements. CASH FLOWS Effective January 1, 2024, we changed the presentation of discontinued operations in the statements of cash flows to an alternate allowable presentation. As a result, the total cash flows for operating, investing and financing activities from discontinued operations are no longer shown separately but instead all cash flows in discontinued operations are presented within each line item as appropriate in the Consolidated Statements of Cash Flows. All prior periods presented have been reclassified to conform to the current period presentation. The most significant impact was that cash outflows of $23 million and $226 million in 2023 and 2022, respectively, related to the repayments of proceeds from the sale of our former Power Grids business are included within Proceeds from sales of businesses in the Consolidated Statements of Cash Flows. The Consolidated Statements of Cash Flows can be summarized as follows: ($ in millions) 2024 2023 2022 Net cash provided by operating activities 4,675 4,290 1,287 Net cash provided by (used in) investing activities (725) (1,615) 981 Net cash used in financing activities (3,326) (2,897) (2,394) Effects of exchange rate changes on cash and equivalents and restricted cash (207) (43) (189) Net change in cash and equivalents and restricted cash 417 (265) (315) Operating activities ($ in millions) 2024 2023 2022 Net income 3,952 3,824 2,594 Depreciation and amortization 802 780 814 Total adjustments to reconcile net income to net cash provided by operating activities (excluding depreciation and amortization) 64 (201) (423) Total changes in operating assets and liabilities (143) (113) (1,698) Net cash provided by operating activities 4,675 4,290 1,287 Cash flows from operating activities in 2024 provided net cash of $4,675 million, an increase of 9 percent compared to 2023. In 2024, we had higher cash effective net income (i.e. net income from continuing operations adjusted for depreciation, amortization and other non-cash items) reflecting the continued increase in revenue volumes and operating margins. However, the timing of payments of accrued liabilities and provisions negatively impacted our improvement in operating cash flows. Our cash flows in 2024 also improved on continued strong working capital management with improvements in both cash collections from customers and an improvement from trade payables; thus, in 2024, we reduced our overall working capital even while realizing higher business volumes. 50 FINANCIAL REPORT 2024 Investing activities ($ in millions) 2024 2023 2022 Purchases of investments (1,563) (1,957) (321) Purchases of property, plant and equipment and intangible assets (845) (770) (762) Acquisition of businesses (net of cash acquired) and increases in cost- and equity-accounted companies (622) (225) (288) Proceeds from sales of investments 2,170 610 697 Proceeds from maturity of investments — 149 73 Proceeds from sales of property, plant and equipment 107 147 127 Proceeds from sales of businesses (net of transaction costs and cash disposed) and cost- and equity-accounted companies (43) 530 1,315 Net cash from settlement of foreign currency derivatives 87 (109) (166) Changes in loans receivable, net (13) 3 320 Other investing activities (3) 7 (14) Net cash provided by (used in) investing activities (725) (1,615) 981 Net cash used in investing activities in 2024 was $725 million compared to $1,615 million in 2023, a reduction of $890 million. We significantly reduced the amount invested in marketable securities and other short-term investments over the year while we had increased the amount in the previous year. In the current year, we also had higher Net cash from settlement of foreign currency derivatives compared to 2023. This was offset by changes in cash related to business acquisitions and divestments. In 2024, we increased our cash allocated to acquisitions and did not generate cash from divestments, while, in 2023, we generated cash from divestments, primarily from the sale of our Power Conversion Division. The following presents purchases of property, plant and equipment and intangible assets by significant asset category: ($ in millions) 2024 2023 2022 Construction in progress 609 532 540 Purchase of machinery and equipment 155 176 127 Purchase of land and buildings 28 11 26 Purchase of intangible assets 53 51 69 Purchases of property, plant and equipment and intangible assets 845 770 762 Financing activities ($ in millions) 2024 2023 2022 Net changes in debt with original maturities of 90 days or less (15) (1,365) 1,366 Increase in debt 1,914 2,586 3,849 Repayment of debt (2,488) (1,567) (2,703) Delivery of shares 451 154 394 Purchase of treasury stock (1,247) (1,258) (3,553) Dividends paid (1,769) (1,713) (1,698) Cash associated with the spin-off of the Turbocharging Division — — (172) Dividends paid to noncontrolling shareholders (103) (93) (99) Proceeds from issuance of subsidiary shares — 328 216 Other financing activities (69) 31 6 Net cash used in financing activities (3,326) (2,897) (2,394) Our financing cash flow activities primarily include debt transactions (both the issuance of debt securities and borrowings directly from banks), share transactions (including share transactions in consolidated subsidiaries) and payments of distributions to controlling and noncontrolling shareholders. In 2024, the net outflow for debt with maturities of 90 days or less related to various local country borrowings. FINANCIAL REPORT 2024 51 In 2024, “Increase in debt” primarily represents borrowings under the following long-term debt transactions (total cashflow amount at date of borrowings of approximately $1,899 million): • EUR 500 million of 3.125% Instruments due 2029 • EUR 750 million of 3.375% Instruments due 2034 • USD 539 million floating-rate term loan due 2031 In 2024, “Repayment of debt” includes primarily the repayment at maturity of the EUR 500 million Floating Rate Instruments, EUR 700 million 0.625% Instruments, EUR 750 million 0.75% Instruments and CHF 280 million 0.3% Bonds. “Delivery of shares” in 2024 primarily reflects cash received from the exercise of options in connection with our Management Incentive Plan (resulting in a delivery of 17 million shares). All shares were delivered out of Treasury stock. In 2024, “Purchase of treasury stock” reflects $998 million of cash payments to purchase 19 million of our own shares in connection with the announced share buyback programs. It also reflects $248 million paid to purchase 5 million shares on the open market during the year. CONTRACTUAL OBLIGATIONS AND COMMITMENTS The contractual obligations presented in the table below represent our estimates of future payments under fixed contractual obligations and commitments. These amounts may differ from those reported in our Consolidated Balance Sheet at December 31, 2024. Changes in our business needs, cancellation provisions and changes in interest rates, as well as actions by third parties and other factors, may cause these estimates to change. Therefore, our actual payments in future periods may vary from those presented below. The table below summarizes certain of our cash requirements for known contractual obligations and principal and interest payments under our debt instruments and purchase obligations at December 31, 2024, and the timing thereof. For details of future operating and finance lease payments, see “Note 14 - Leases” to our Consolidated Financial Statements. At December 31, 2024 ($ in millions) Current Non-current Total Long-term debt obligations 183 6,623 6,806 Interest payments related to long-term debt obligations 227 1,379 1,606 Purchase obligations 3,082 816 3,898 Total 3,492 8,818 12,310 In the table above, the “Long ‑ term debt obligations” reflect the cash amounts to be repaid upon maturity of those debt obligations. The cash obligations above will differ from Long ‑ term debt due to the impacts of fair value hedge accounting adjustments and premiums or discounts on certain debt. We have determined the interest payments related to long ‑ term debt obligations by reference to the payments due under the terms of our debt obligations at the time such obligations were incurred. However, we use interest rate swaps to modify the interest characteristics of certain of our debt obligations. The net effect of these swaps may increase or decrease the actual amount of our cash interest payment obligations, which may differ from those stated in the above table. For further details on our debt obligations and the related hedges, see “Note 13 - Debt” to our Consolidated Financial Statements. Purchase obligations are defined as agreements to purchase goods and services that are enforceable and legally binding and that specify all significant terms, including the quantities to be purchased, price provisions and the approximate timing of the transactions. Purchase obligations include procurement contracts for raw materials, sub-contracted work, supplies and services. Purchase obligations include amounts recorded as well as amounts that are not recorded in the Consolidated Balance Sheet. 52 FINANCIAL REPORT 2024 OFF ‑ BALANCE SHEET ARRANGEMENTS Commercial commitments We disclose the maximum potential exposure of certain guarantees, as well as possible recourse provisions that may allow us to recover from third parties amounts paid out under such guarantees. The maximum potential exposure does not allow any discounting of our assessment of actual exposure under the guarantees. The information below reflects our maximum potential exposure under the guarantees, which is higher than our assessment of the expected exposure. Guarantees The following table provides quantitative data regarding our third ‑ party guarantees. The maximum potential payments represent a worst ‑ case scenario and do not reflect our expected outcomes. Maximum potential payments December 31, ($ in millions) 2024 2023 Performance guarantees 2,299 3,451 Financial guarantees 22 94 Total 2,321 3,545 The carrying amount of liabilities recorded in the Consolidated Balance Sheets reflects our best estimate of future payments, which we may incur as part of fulfilling our guarantee obligations. In respect of the above guarantees, the carrying amounts of liabilities at December 31, 2024 and 2023, were not significant. In addition, in the normal course of bidding for and executing certain projects, we have entered into standby letters of credit, bid/performance bonds and surety bonds (collectively “performance bonds”) with various financial institutions. Customers can draw on such performance bonds in the event that we do not fulfill our contractual obligations. We would then have an obligation to reimburse the financial institution for amounts paid under the performance bonds. At December 31, 2024 and 2023, the total outstanding performance bonds aggregated to $3.2 billion and $3.1 billion, respectively. There have been no significant amounts reimbursed to financial institutions under these types of arrangements in 2024 and 2023. For additional descriptions of our performance, financial and indemnification guarantees see “Note 15 - Commitments and contingencies” to our Consolidated Financial Statements. FINANCIAL RISK The continuously evolving financial markets and the dynamic business environment expose us to changes in foreign exchange, interest rate and other market price risks. We have developed and implemented comprehensive policies, procedures, and controls to identify, mitigate, and monitor financial risk on a company-wide basis. To efficiently aggregate and manage financial risks that could impact our financial performance, we operate a Corporate Treasury function. Corporate Treasury provides an efficient source of liquidity, financing, risk management and other global financial services to the ABB Group companies. Our policies do not allow Corporate Treasury or ABB Group companies to perform speculative trading. Market risk management activities are focused on mitigating material financial risks resulting from our global operating and financing activities. Corporate Treasury maintains risk management control systems to monitor foreign exchange and interest rate risks and exposures arising from our underlying business, as well as the associated hedge positions. Our written policies govern how such exposures are managed. Financial risks are monitored using a number of analytical techniques including market value and sensitivity analysis. The following quantitative analyses are based on sensitivity analysis tests, which assume parallel shifts of interest rate yield curves and foreign exchange rates. Currency fluctuations and foreign exchange risk It is our policy to systematically identify and manage all transactional foreign exchange exposures to ensure effective risk control. With the exception of certain financing subsidiaries and to the extent certain operating subsidiaries are domiciled in high inflation environments, the functional currency of each of our companies is considered to be its local currency. Our policies require our subsidiaries to hedge contracted foreign exchange exposures, or a portion of their forecast exposures, against their local currency. These transactions are undertaken mainly with Corporate Treasury. FINANCIAL REPORT 2024 53 We have foreign exchange transaction exposures related to our global operating and financing activities in currencies other than the functional currency in which our entities operate. Specifically, we are exposed to foreign exchange risk related to future earnings, assets or liabilities denominated in foreign currencies. The most significant currency exposures relate to operations in the Eurozone area, Sweden, China and Switzerland. In addition, we are exposed to currency risk associated with translating our functional currency financial statements into our reporting currency, which is the U.S. dollar. Our operating companies are responsible for identifying their foreign currency exposures and entering into intercompany derivative contracts with Corporate Treasury, where legally possible, to hedge their exposures. Where local laws restrict our operating companies from entering into intercompany derivatives with Corporate Treasury, derivative contracts are entered into locally with third-party financial institutions. The intercompany transactions have the effect of transferring the operating companies’ currency risk to Corporate Treasury, but create no additional market risks on a consolidated basis. Corporate Treasury then manages this risk by entering into offsetting transactions with third-party financial institutions. According to our policy, material net currency exposures are required to be hedged and are primarily hedged with forward foreign exchange contracts. The majority of the foreign exchange hedge instruments have, on average, a maturity of less than twelve months. Corporate Treasury also hedges currency risks arising from monetary intercompany balances. At December 31, 2024, the net fair value of financial instruments with exposure to foreign currency rate movements was an asset of $311 million. The potential loss in fair value of such financial instruments from a hypothetical 10 percent move in foreign exchange rates against our position would be approximately $603 million for December 31, 2024. The analysis reflects the aggregate adverse foreign exchange impact associated with transaction exposures, as well as translation exposures where appropriate. Our sensitivity analysis assumes a simultaneous shift in exchange rates against our positions exposed to foreign exchange risk and as such assumes an unlikely adverse case scenario. The assumption of a simultaneous shift may overstate the impact of changing rates on assets and liabilities denominated in foreign currencies. The underlying trade-related transaction exposures of our operating subsidiaries are not included in the quantitative analysis. If these underlying transaction exposures were included, they would tend to have a directionally offsetting effect on the potential loss in fair value detailed above. Interest rate risk We are exposed to interest rate risk due to our financing, investing, and liquidity management activities. Our operating companies primarily invest excess cash with, and receive funding from, Corporate Treasury on an arm’s length basis. It is our policy that the primary third-party funding and investing activities, as well as the monitoring and management of the resulting interest rate risk, are the responsibility of Corporate Treasury. Corporate Treasury adjusts the duration of the overall funding portfolio through derivative instruments in order to better match underlying assets and liabilities, as well as minimize the cost of capital. At December 31, 2024, the net fair value of instruments subject to interest rate risk was a liability of $2,313 million. The potential loss in fair value for such instruments from a hypothetical 100 basis points parallel shift in interest rates against our position (or a multiple of 100 basis points where 100 basis points is less than 10 percent of the interest rate) would be approximately $368 million for December 31, 2024. Commodity risk We enter into commodity derivatives to hedge certain of our raw material exposures. Based on exposures at December 31, 2024, the potential loss in fair value for such commodity hedging derivatives from a hypothetical adverse 10 percent move against our position in the underlying commodity prices would not be significant for December 31, 2024. A portion of our commodity derivatives are denominated in euro. The foreign exchange risk arising on such contracts has been excluded from the calculation of the potential loss in fair value from a hypothetical 10 percent move in the underlying commodity prices as discussed above. 55 Financial Statements and Notes 121 Reports of the Auditors FINANCIAL REPORT 2024 55 — ABB LTD CONSOLIDATED INCOME STATEMENTS Year ended December 31 ($ in millions, except per share data in $) 2024 2023 2022 Sales of products 27,217 27,010 24,471 Sales of services and other 5,633 5,225 4,975 Total revenues 32,850 32,235 29,446 Cost of sales of products (17,347) (17,938) (16,804) Cost of services and other (3,229) (3,083) (2,932) Total cost of sales (20,576) (21,021) (19,736) Gross profit 12,274 11,214 9,710 Selling, general and administrative expenses (5,708) (5,543) (5,132) Non-order related research and development expenses (1,469) (1,317) (1,166) Other income (expense), net (26) 517 (75) Income from operations 5,071 4,871 3,337 Interest and dividend income 206 165 72 Interest and other finance expense (99) (275) (130) Non-operational pension (cost) credit 55 17 115 Income from continuing operations before taxes 5,233 4,778 3,394 Income tax expense (1,278) (930) (757) Income from continuing operations, net of tax 3,955 3,848 2,637 Loss from discontinued operations, net of tax (3) (24) (43) Net income 3,952 3,824 2,594 Net income attributable to noncontrolling interests and redeemable noncontrolling interests (17) (79) (119) Net income attributable to ABB 3,935 3,745 2,475 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 3,937 3,769 2,517 Loss from discontinued operations, net of tax (2) (24) (42) Net income 3,935 3,745 2,475 Basic earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.14 2.03 1.33 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.02 1.30 Diluted earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.13 2.02 1.32 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.01 1.30 Weighted-average number of shares outstanding (in millions) used to compute: Basic earnings per share attributable to ABB shareholders 1,844 1,855 1,899 Diluted earnings per share attributable to ABB shareholders 1,851 1,867 1,910 Due to rounding, numbers presented may not add to the totals provided. See accompanying Notes to the Consolidated Financial Statements 56 FINANCIAL REPORT 2024 — ABB LTD CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Year ended December 31 ($ in millions) 2024 2023 2022 Net income 3,952 3,824 2,594 Other comprehensive income (loss), net of tax: Foreign currency translation adjustments: Foreign currency translation adjustments (319) (290) (685) Net loss on complete or substantially complete liquidations of foreign subsidiaries 14 — 5 Changes attributable to divestments 9 9 41 Foreign currency translation adjustments (296) (281) (639) Available-for-sale securities: Net unrealized gains (losses) arising during the year 1 5 (23) Reclassification adjustments for net losses included in net income 4 6 2 Unrealized gains (losses) on available-for-sale securities 5 11 (21) Pension and other postretirement plans: Prior service (costs) credits arising during the year (10) (1) — Net actuarial gains (losses) arising during the year (37) (282) 226 Amortization of prior service credit included in net income (10) (9) (16) Amortization of net actuarial loss included in net income 47 38 44 Net (gains) losses from settlements and curtailments included in net income (6) 14 9 Changes attributable to divestments — 3 (8) Pension and other postretirement plan adjustments (16) (237) 255 Derivative instruments and hedges: Net unrealized losses arising during the year (8) (10) (12) Reclassification adjustments for net losses included in net income 10 8 12 Changes in derivative instruments and hedges 2 (2) — Total other comprehensive income (loss), net of tax (305) (509) (405) Total comprehensive income, net of tax 3,647 3,315 2,189 Total comprehensive (income) loss attributable to noncontrolling interests and redeemable noncontrolling interests, net of tax 8 (84) (87) Total comprehensive income attributable to ABB, net of tax 3,655 3,231 2,102 Due to rounding, numbers presented may not add to the totals provided. See accompanying Notes to the Consolidated Financial Statements FINANCIAL REPORT 2024 57 — ABB LTD CONSOLIDATED BALANCE SHEETS December 31 ($ in millions, except share data) 2024 2023 Cash and equivalents 4,311 3,891 Restricted cash 15 18 Marketable securities and short-term investments 1,334 1,928 Receivables, net 7,388 7,446 Contract assets 1,115 1,090 Inventories, net 5,859 6,149 Prepaid expenses 287 235 Other current assets 541 520 Total current assets 20,850 21,277 Property, plant and equipment, net 4,177 4,142 Operating lease right-of-use assets 840 893 Investments in equity-accounted companies 368 187 Prepaid pension and other employee benefits 689 780 Intangible assets, net 1,048 1,223 Goodwill 10,555 10,561 Deferred taxes 1,341 1,381 Other non-current assets 489 496 Total assets 40,357 40,940 Accounts payable, trade 5,036 4,847 Contract liabilities 2,969 2,844 Short-term debt and current maturities of long-term debt 293 2,607 Current operating leases 235 249 Provisions for warranties 1,248 1,210 Other provisions 853 1,201 Other current liabilities 4,582 5,046 Total current liabilities 15,216 18,004 Long-term debt 6,652 5,221 Non-current operating leases 631 666 Pension and other employee benefits 569 686 Deferred taxes 675 669 Other non-current liabilities 1,554 1,548 Total liabilities 25,297 26,794 Commitments and contingencies Redeemable noncontrolling interest — 89 Stockholders’ equity: Common stock, CHF 0.12 par value (1,861 million and 1,882 million shares issued at December 31, 2024 and 2023, respectively) 162 163 Additional paid-in capital 50 7 Retained earnings 20,717 19,724 Accumulated other comprehensive loss (5,350) (5,070) Treasury stock, at cost (22 million and 40 million shares at December 31, 2024 and 2023, respectively) (1,091) (1,414) Total ABB stockholders’ equity 14,488 13,410 Noncontrolling interests 572 647 Total stockholders’ equity 15,060 14,057 Total liabilities and stockholders’ equity 40,357 40,940 Due to rounding, numbers presented may not add to the totals provided. See accompanying Notes to the Consolidated Financial Statements 58 FINANCIAL REPORT 2024 — ABB LTD CONSOLIDATED STATEMENTS OF CASH FLOWS Year ended December 31 ($ in millions) 2024 2023 2022 Operating activities: Net income 3,952 3,824 2,594 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 802 780 814 Changes in fair values of investments 65 (29) (33) Pension and other employee benefits (92) (48) (125) Deferred taxes (2) (28) (344) Loss from equity-accounted companies 21 16 102 Net gain from derivatives and foreign exchange (52) (54) (22) Net gain from sale of property, plant and equipment (60) (116) (84) Net loss (gain) from sale of businesses (67) (100) 17 Fair value adjustment on assets and liabilities held for sale 113 — — Other 138 158 66 Changes in operating assets and liabilities: Trade receivables, net (179) (633) (811) Contract assets and liabilities 203 412 419 Inventories, net (101) (3) (1,602) Accounts payable, trade 189 (129) 369 Accrued liabilities (8) 252 137 Provisions, net (29) 212 (67) Income taxes payable and receivable (123) (190) (95) Other assets and liabilities, net (95) (34) (48) Net cash provided by operating activities 4,675 4,290 1,287 Investing activities: Purchases of investments (1,563) (1,957) (321) Purchases of property, plant and equipment and intangible assets (845) (770) (762) Acquisition of businesses (net of cash acquired) and increases in cost- and equity-accounted (622) (225) (288) Proceeds from sales of investments 2,170 610 697 Proceeds from maturity of investments — 149 73 Proceeds from sales of property, plant and equipment 107 147 127 Proceeds from sales of businesses (net of transaction costs and cash disposed) and cost- and equity-accounted companies (43) 530 1,315 Net cash from settlement of foreign currency derivatives 87 (109) (166) Changes in loans receivable, net (13) 3 320 Other investing activities (3) 7 (14) Net cash provided by (used in) investing activities (725) (1,615) 981 Financing activities: Net changes in debt with original maturities of 90 days or less (15) (1,365) 1,366 Increase in debt 1,914 2,586 3,849 Repayment of debt (2,488) (1,567) (2,703) Delivery of shares 451 154 394 Purchase of treasury stock (1,247) (1,258) (3,553) Dividends paid (1,769) (1,713) (1,698) Cash associated with the spin-off of the Turbocharging Division — — (172) Dividends paid to noncontrolling shareholders (103) (93) (99) Proceeds from issuance of subsidiary shares — 328 216 Other financing activities (69) 31 6 Net cash used in financing activities (3,326) (2,897) (2,394) Effects of exchange rate changes on cash and equivalents and restricted cash (207) (43) (189) Net change in cash and equivalents and restricted cash 417 (265) (315) Cash and equivalents and restricted cash, beginning of period 3,909 4,174 4,489 Cash and equivalents and restricted cash, end of period 4,326 3,909 4,174 Supplementary disclosure of cash flow information: Interest paid 241 250 90 Income taxes paid 1,382 1,147 1,188 Due to rounding, numbers presented may not add to the totals provided. See accompanying Notes to the Consolidated Financial Statements FINANCIAL REPORT 2024 59 — ABB LTD CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY Accumulated Additional other Total ABB Non- Total Years ended December 31, 2024, 2023 and 2022 Common paid-in Retained comprehensive Treasury stockholders’ controlling stockholders’ ($ in millions) stock capital earnings loss stock equity interests equity Balance at January 1, 2022 178 22 22,477 (4,088) (3,010) 15,579 378 15,957 Net income (1) 2,475 2,475 124 2,599 Foreign currency translation adjustments, net of tax (608) (608) (31) (639) Effect of change in fair value of available-for-sale securities, net of tax (21) (21) (21) Unrecognized income (expense) related to pensions and other postretirement plans, net of tax 256 256 (1) 255 Change in derivative instruments and hedges, net of tax — — — Issuance of subsidiary shares 120 120 86 206 Other changes in noncontrolling interests 10 10 (34) (24) Dividends to noncontrolling shareholders — (100) (100) Dividends to shareholders (1,700) (1,700) (1,700) Spin-off of the Turbocharging Division (177) (95) (272) (12) (284) Cancellation of treasury shares (8) (4) (2,864) 2,876 — — Share-based payment arrangements 42 42 42 Purchase of treasury stock (3,502) (3,502) (3,502) Delivery of shares (51) (130) 575 394 394 Other 2 2 2 Balance at December 31, 2022 171 141 20,082 (4,556) (3,061) 12,777 410 13,187 Net income (1) 3,745 3,745 83 3,828 Foreign currency translation adjustments, net of tax (286) (286) 5 (281) Effect of change in fair value of available-for-sale securities, net of tax 11 11 11 Unrecognized income (expense) related to pensions and other postretirement plans, net of tax (237) (237) (237) Change in derivative instruments and hedges, net of tax (2) (2) (2) Issuance of subsidiary shares 170 170 168 338 Other changes in noncontrolling interests (31) (37) (68) 67 (1) Dividends to noncontrolling shareholders — (93) (93) Dividends to shareholders (1,706) (1,706) (1,706) Cancellation of treasury shares (7) (201) (2,359) 2,567 — — Share-based payment arrangements 101 101 2 103 Purchase of treasury stock (1,247) (1,247) (1,247) Delivery of shares (173) 327 154 154 Other (2) (2) 5 3 Balance at December 31, 2023 163 7 19,724 (5,070) (1,414) 13,410 647 14,057 Net income (1) 3,935 3,935 19 3,954 Foreign currency translation adjustments, net of tax (271) (271) (25) (296) Effect of change in fair value of available-for-sale securities, net of tax 5 5 5 Unrecognized income (expense) related to pensions and other postretirement plans, net of tax (16) (16) (16) Change in derivative instruments and hedges, net of tax 2 2 2 Changes in noncontrolling interests (10) (62) (72) 30 (42) Dividends to noncontrolling shareholders — (104) (104) Dividends to shareholders (1,804) (1,804) (1,804) Cancellation of treasury shares (2) (2) (828) 832 — — Share-based payment arrangements 97 97 5 102 Purchase of treasury stock (1,251) (1,251) (1,251) Delivery of shares (40) (249) 740 451 451 Other (1) (1) (1) Balance at December 31, 2024 162 50 20,717 (5,350) (1,091) 14,488 572 15,060 (1) Amounts attributable to noncontrolling interests in 2024, 2023 and 2022 exclude net losses of $2 million, $4 million and $5 million, respectively, related to redeemable noncontrolling interests, which are reported in the mezzanine equity section on the Consolidated Balance Sheets. See Note 4 for details. Due to rounding, numbers presented may not add to the totals provided. See accompanying Notes to the Consolidated Financial Statements 60 FINANCIAL REPORT 2024 — NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — Note 1 The Company ABB Ltd and its subsidiaries (collectively, the Company) together form a global technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. By connecting its engineering and digitalization expertise, ABB helps industries run at high performance, while becoming more efficient, productive and sustainable so they outperform. — Note 2 Significant accounting policies The following is a summary of significant accounting policies followed in the preparation of these Consolidated Financial Statements. Basis of presentation The Consolidated Financial Statements are prepared in accordance with United States of America (United States or U.S.) generally accepted accounting principles (U.S. GAAP) and are presented in United States dollars ($ or USD) unless otherwise stated. Due to rounding, numbers presented may not add to the totals provided. The par value of capital stock is denominated in Swiss francs. Reclassifications and presentation changes Certain amounts reported for prior years in the Consolidated Financial Statements and the accompanying Notes have been reclassified to conform to the current year’s presentation. Effective January 1, 2024, the Company changed the presentation of discontinued operations in its statement of cash flows to an alternate allowable presentation. As a result, the total cash flows for operating, investing and financing activities from discontinued operations are no longer shown separately but instead all cash flows in discontinued operations are presented within each line item as appropriate in the statement of cash flows. All prior periods presented have been reclassified to conform to the current period presentation primarily resulting in a decrease of $23 million and $226 million in Proceeds from sales of businesses (net of transaction costs and cash disposed) and cost- and equity-accounted companies for 2023 and 2022, respectively. Scope of consolidation The Consolidated Financial Statements include the accounts of ABB Ltd and companies which are directly or indirectly controlled by ABB Ltd. Additionally, the Company consolidates variable interest entities if it has determined that it is the primary beneficiary. Intercompany accounts and transactions are eliminated. Investments in joint ventures and affiliated companies in which the Company has the ability to exercise significant influence over operating and financial policies (generally through direct or indirect ownership of 20 percent to 50 percent of the voting rights and/or board of director representation) are recorded in the Consolidated Financial Statements using the equity method of accounting. FINANCIAL REPORT 2024 61 Translation of foreign currencies and foreign exchange transactions The functional currency for most of the Company’s subsidiaries is the applicable local currency. The translation from the applicable functional currencies into the Company’s reporting currency is performed for balance sheet accounts using exchange rates in effect at the balance sheet date and for income statement accounts using average exchange rates prevailing during the year. The resulting translation adjustments are excluded from the determination of earnings and are recognized in Accumulated other comprehensive loss until the subsidiary is sold, substantially liquidated or evaluated for impairment in anticipation of disposal. Foreign currency exchange gains and losses, such as those resulting from foreign currency denominated receivables or payables, are included in the determination of earnings, except as they relate to intercompany loans that are equity ‑ like in nature with no reasonable expectation of repayment, which are recognized in Accumulated other comprehensive loss. Exchange gains and losses are recognized in earnings and classified in the line item consistent with the underlying transaction or item. Operating cycle For classification of certain current assets and liabilities, the Company has elected to use the duration of individual contracts as its operating cycle. Accordingly, there are contract assets and liabilities, accounts receivable, inventories and provisions related to these contracts which will not be realized within one year that have been classified as current. Long-term system integration activities comprise the majority of the Company’s activities which have an operating cycle in excess of one year that have been classified as current. Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make assumptions and estimates that directly affect the amounts reported in the Consolidated Financial Statements and the accompanying Notes. These accounting assumptions and estimates include: • estimates to determine valuation allowances for deferred tax assets and amounts recorded for unrecognized tax benefits, • estimates related to credit losses expected to occur over the remaining life of financial assets such as trade and other receivables, loans and other instruments, • estimates of loss contingencies associated with litigation or threatened litigation and other claims and inquiries, environmental damages, product warranties, self ‑ insurance reserves, regulatory and other proceedings, • assumptions and projections, principally related to future material, labor and project ‑ related overhead costs, used in determining the percentage ‑ of ‑ completion on projects where revenue is recognized over time, as well as the amount of variable consideration the Company expects to be entitled to, • assumptions used in the calculation of pension and postretirement benefits and the fair value of pension plan assets, • estimates used to record expected costs for employee severance in connection with restructuring programs, • assumptions used in determining inventory obsolescence and net realizable value, • growth rates, discount rates and other assumptions used to determine impairment of long ‑ lived assets and in testing goodwill for impairment, • estimates and assumptions used in determining the fair values of assets and liabilities assumed in business combinations, and • estimates and assumptions used in determining the initial fair value of retained noncontrolling interests and certain obligations in connection with divestments. 62 FINANCIAL REPORT 2024 The actual results and outcomes may differ from the Company’s estimates and assumptions. Cash and equivalents Cash and equivalents include highly liquid investments with maturities of three months or less at the date of acquisition. Currency and other local regulatory limitations related to the transfer of funds exist in a number of countries where the Company operates. Funds, other than regular dividends, fees or loan repayments, cannot be readily transferred abroad from these countries and are therefore deposited and used for working capital needs locally. These funds are included in cash and equivalents as they are not considered restricted. Cash and equivalents that are subject to contractual restrictions or other legal obligations and are not readily available are classified as Restricted cash. Marketable securities and short ‑ term investments Management determines the appropriate classification of held ‑ to ‑ maturity and available ‑ for ‑ sale debt securities at the time of purchase. Debt securities are classified as held ‑ to ‑ maturity when the Company has the positive intent and ability to hold the securities to maturity. Held ‑ to ‑ maturity debt securities are carried at amortized cost, adjusted for accretion of discounts or amortization of premiums to maturity computed under the effective interest method. Such accretion or amortization is included in Interest and dividend income. Marketable debt securities not classified as held ‑ to ‑ maturity are classified as available ‑ for ‑ sale and reported at fair value. Unrealized gains and losses on available ‑ for ‑ sale debt securities are excluded from the determination of earnings and are instead recognized in the Accumulated other comprehensive loss component of stockholders’ equity, net of tax, until realized. Realized gains and losses on available ‑ for ‑ sale debt securities are computed based upon the historical cost of these securities, using the specific identification method. Marketable debt securities are classified as either Cash and equivalents or Marketable securities and short ‑ term investments according to their maturity at the time of acquisition. Marketable equity securities are generally classified as Marketable securities and short ‑ term investments, however, any marketable securities held as a long ‑ term investment rather than as an investment of excess liquidity are classified as Other non ‑ current assets. Marketable equity securities are measured at fair value with fair value changes reported in net income. Fair value changes for marketable equity securities are generally reported in Interest and other finance expense, however, fair value changes for certain marketable equity securities classified as long-term investments are reported in Other income (expense). For debt securities classified as available-for-sale where fair value has declined below amortized cost due to credit losses, the Company records an allowance for expected credit losses and adjusts the allowance in subsequent periods in Interest and other finance expense. All fair value changes other than those related to credit risk are reported in Accumulated other comprehensive loss until the security is sold. In addition, equity securities without readily determinable fair values are remeasured if there is an observable price change in an orderly transaction for the same investment, or if a qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than its carrying amount. Similar to other fair value changes as described above, depending on the nature of the investment, this fair value change is either recorded in Other income (expense) or Interest and other finance expense. FINANCIAL REPORT 2024 63 Accounts receivable and allowance for expected credit losses Accounts receivable are recorded at the invoiced amount. The Company has a group ‑ wide policy on the management of credit risk. The policy includes a credit assessment methodology to assess the creditworthiness of customers and assign to those customers a risk category. Third ‑ party agencies’ ratings are considered, if available. For customers where agency ratings are not available, the customer’s most recent financial statements, payment history and other relevant information are considered in the assignment to a risk category. Customers are assessed at least annually or more frequently when information on significant changes in the customer’s financial position becomes known. In addition to the assignment to a risk category, a credit limit per customer is set. The Company recognizes an allowance for credit losses to present the net amount of receivables expected to be collected at the balance sheet date. The allowance is based on the credit losses expected to arise over the asset’s contractual term taking into account historical loss experience, customer-specific data as well as forward looking estimates. The Company’s accounts receivable are first grouped by the individual legal entity which generally has a geographic concentration of receivables, resulting in different risk levels for different entities. Receivables are then further subdivided within the entity into pools based on similar risk characteristics to estimate expected credit losses. Expected credit losses are estimated individually when the related assets do not share similar risk characteristics. Accounts receivable are written off when deemed uncollectible and are recognized as a deduction from the allowance for credit losses. Expected recoveries, which are not to exceed the amount previously written off, are considered in determining the allowance balance at the balance sheet date. The Company, in its normal course of business, transfers receivables to third parties, generally without recourse. The transfer is accounted for as a sale when the Company has surrendered control over the receivables. Control is deemed to have been surrendered when (i) the transferred receivables have been put presumptively beyond the reach of the Company and its creditors, even in bankruptcy or other receivership, (ii) the third ‑ party transferees have the right to pledge or exchange the transferred receivables, and (iii) the Company has relinquished effective control over the transferred receivables and does not retain the ability or obligation to repurchase or redeem the transferred receivables. At the time of sale, the sold receivables are removed from the Consolidated Balance Sheets and the related cash inflows are classified as operating activities in the Consolidated Statements of Cash Flows. Transfers of receivables that do not meet the requirements for treatment as sales are accounted for as secured borrowings and the related cash flows are classified as financing activities in the Consolidated Statements of Cash Flows. Concentrations of credit risk The Company sells a broad range of products, systems, services and software to a wide range of industrial, commercial and utility customers as well as various government agencies and quasi ‑ governmental agencies throughout the world. Concentrations of credit risk with respect to accounts receivable are limited, as the Company’s customer base is comprised of a large number of individual customers. Ongoing credit evaluations of customers’ financial positions are performed to determine whether the use of credit support instruments such as guarantees, letters of credit or credit insurance are necessary; collateral is not generally required. The Company maintains an allowance for credit losses as discussed above in “Accounts receivable and allowance for expected credit losses”. Such losses, in the aggregate, are in line with the Company’s expectations. It is the Company’s policy to invest cash in deposits with banks throughout the world with certain minimum credit ratings and in high-quality, low-risk, liquid investments. The Company actively manages its credit risk by routinely reviewing the creditworthiness of the banks and the investments held. The Company has not incurred significant credit losses related to such investments. The Company’s exposure to credit risk on derivative financial instruments is the risk that the counterparty will fail to meet its obligations. To reduce this risk, the Company has credit policies that require the establishment and periodic review of credit limits for individual counterparties. In addition, the Company has entered into close ‑ out netting agreements with most derivative counterparties. Close ‑ out netting agreements provide for the termination, valuation and net settlement of some or all outstanding transactions between two counterparties on the occurrence of one or more pre ‑ defined trigger events. Derivative instruments are presented on a gross basis in the Consolidated Financial Statements. 64 FINANCIAL REPORT 2024 Revenue recognition A customer contract exists if collectability under the contract is considered probable, the contract has commercial substance, contains payment terms, as well as the rights and commitments of both parties, and has been approved. The Company offers arrangements with multiple performance obligations to meet its customers’ needs. These arrangements may involve the delivery of multiple products and/or performance of services (such as installation and training) and the delivery and/or performance may occur at different points in time or over different periods of time. Goods and services under such arrangements are evaluated to determine whether they form distinct performance obligations and should be accounted for as separate revenue transactions. The Company allocates the sales price to each distinct performance obligation based on the price of each item sold in separate transactions at the inception of the arrangement. The Company generally recognizes revenues for the sale of non ‑ customized products including circuit breakers, modular substation packages, control products, motors, generators, drives, robots, measurement and analytical instrumentation, and other goods which are manufactured on a standardized basis at a point in time. Revenues are recognized at the point in time that the customer obtains control of the goods, which is when it has taken title to the products and assumed the risks and rewards of ownership of the products specified in the purchase order or sales agreement. Generally, the transfer of title and risks and rewards of ownership are governed by the contractually defined shipping terms. The Company uses various International Commercial Terms (as promulgated by the International Chamber of Commerce) in its sales of products to third-party customers, such as Ex Works (EXW), Free Carrier (FCA) and Delivered Duty Paid (DDP). Billing terms for these point in time contracts vary but generally coincide with delivery to the customer. Payment is generally due upon receipt of the invoice, payable within 90 days or less. The Company generally recognizes revenues for the sale of customized products, including integrated automation and electrification systems and solutions, on an over time basis using the percentage ‑ of ‑ completion method of accounting. These systems are generally accounted for as a single performance obligation as the Company is required to integrate equipment and services into one deliverable for the customer. Revenues are recognized as the systems are customized during the manufacturing or integration process and as control is transferred to the customer as evidenced by the Company’s right to payment for work performed or by the customer’s ownership of the work in process. The Company principally uses the cost ‑ to ‑ cost method to measure progress towards completion on contracts. Under this method, progress of contracts is measured by actual costs incurred in relation to the Company’s best estimate of total costs based on the Company’s history of manufacturing or constructing similar assets for customers. Estimated costs are reviewed and updated routinely for contracts in progress to reflect changes in quantity or pricing of the inputs. The cumulative effect of any change in estimate is recorded in the period when the change in estimate is determined. Contract costs include all direct materials, labor and subcontract costs and indirect costs related to contract performance, such as indirect labor, supplies, tools and depreciation costs. The nature of the Company’s contracts for the sale of customized products gives rise to several types of variable consideration, including claims, unpriced change orders, liquidated damages and penalties. These amounts are estimated based upon the most likely amount of consideration to which the customer or the Company will be entitled. The estimated amounts are included in the sales price to the extent it is probable that a significant reversal of cumulative revenues recognized will not occur when the uncertainty associated with the variable consideration is resolved. All estimates of variable consideration are reassessed periodically. Back charges to suppliers or subcontractors are recognized as a reduction of cost when it is determined that recovery of such cost is probable and the amounts can be reliably estimated. Billing terms for these over ‑ time contracts vary but are generally based on achieving specified milestones. The differences between the timing of revenues recognized and customer billings result in changes to contract assets and contract liabilities. Payment is generally due upon receipt of the invoice, payable within 90 days or less. Contractual retention amounts billed to customers are generally due upon expiration of the contractual warranty period. FINANCIAL REPORT 2024 65 Service revenues reflect revenues earned from the Company’s activities in providing services to customers primarily subsequent to the sale and delivery of a product or complete system. Such revenues consist of maintenance type contracts, repair services, equipment upgrades, field service activities that include personnel and accompanying spare parts, training, and installation and commissioning of products as a stand-alone service or as part of a service contract. The Company generally recognizes revenues from service transactions as services are performed or at the point in time that the customer obtains control of the spare parts. For long-term service contracts including monitoring and maintenance services, revenues are recognized on a straight-line basis over the term of the contract consistent with the nature, timing and extent of the services or, if the performance pattern is other than straight line, as the services are provided based on costs incurred relative to total expected costs. In limited circumstances the Company sells extended warranties that extend the warranty coverage beyond the standard coverage offered on specific products. Revenues for these warranties are recorded over the length of the warranty period based on their stand ‑ alone selling price. Billing terms for service contracts vary but are generally based on the occurrence of a service event. Payment is generally due upon receipt of the invoice, payable within 90 days or less. Revenues are reported net of customer rebates, early settlement discounts, and similar incentives. Rebates are estimated based on sales terms, historical experience and trend analysis. The most common incentives relate to amounts paid or credited to customers for achieving defined volume levels. Taxes assessed by a governmental authority that are directly imposed on revenue-producing transactions between the Company and its customers, such as sales, use, value added and some excise taxes, are excluded from revenues. The Company does not adjust the contract price for the effects of a financing component if the Company expects, at contract inception, that the time between control transfer and cash receipt is less than 12 months. Sales commissions are expensed immediately when the amortization period for the costs to obtain the contract is less than a year. Contract loss provisions Losses on contracts are recognized in the period when they are identified and are based upon the anticipated excess of contract costs over the related contract revenues. Shipping and handling costs Shipping and handling costs are recorded as a component of cost of sales. Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined using the first ‑ in, first ‑ out method, the weighted ‑ average cost method, or the specific identification method. Inventoried costs are stated at acquisition cost or actual production cost, including direct material and labor and applicable manufacturing overheads. Adjustments to reduce the cost of inventory to its net realizable value are made, if required, for decreases in sales prices, obsolescence or similar reductions in value. Impairment of long ‑ lived assets Long ‑ lived assets that are held and used are evaluated for impairment for each of the Company’s asset groups when events or circumstances indicate that the carrying amount of the long-lived asset or asset group may not be recoverable. If the asset group’s net carrying value exceeds the asset group’s net undiscounted cash flows expected to be generated over its remaining useful life including net proceeds expected from disposition of the asset group, if any, the carrying amount of the asset group is reduced to its estimated fair value. The estimated fair value is determined using a market, income and/or cost approach. 66 FINANCIAL REPORT 2024 Property, plant and equipment Property, plant and equipment is stated at cost, less accumulated depreciation and is depreciated using the straight ‑ line method. The estimated useful lives of the assets are generally as follows: • factories and office buildings: 30 to 40 years, • other facilities: 15 years, • machinery and equipment: 3 to 15 years, • furniture and office equipment: 3 to 8 years, and • leasehold improvements are depreciated over their estimated useful life or, for operating leases, over the lease term, if shorter. Goodwill and intangible assets Goodwill is reviewed for impairment annually as of October 1, or more frequently if events or circumstances indicate that the carrying value may not be recoverable. Goodwill is evaluated for impairment at the reporting unit level. A reporting unit is an operating segment or one level below an operating segment. For the annual impairment reviews performed in 2024, the reporting units were determined to be one level below the operating segments. When evaluating goodwill for impairment, the Company uses either a qualitative or quantitative assessment method for each reporting unit. The qualitative assessment involves determining, based on an evaluation of qualitative factors, if it is more likely than not that the fair value of a reporting unit is less than its carrying value. If, based on this qualitative assessment, it is determined to be more likely than not that the reporting unit’s fair value is less than its carrying value, a quantitative impairment test is performed, otherwise no further analysis is required. If the Company elects not to perform the qualitative assessment for a reporting unit, then a quantitative impairment test is performed. When performing a quantitative impairment test, the Company generally calculates the fair value of a reporting unit using an income approach based on the present value of future cash flows, applying a discount rate that represents the reporting unit’s weighted-average cost of capital, and compares it to the reporting unit’s carrying value. If the carrying value of the net assets of a reporting unit exceeds the fair value of the reporting unit then the Company records an impairment charge equal to the difference, provided that the loss recognized does not exceed the total amount of goodwill allocated to that reporting unit. The cost of acquired intangible assets with a finite life is amortized using a method of amortization that reflects the pattern of intangible assets’ expected contributions to future cash flows. If that pattern cannot be reliably determined, the straight ‑ line method is used. The amortization periods range from 3 to 5 years for software and from 5 to 20 years for customer ‑ , technology ‑ and marketing ‑ related intangibles. Intangible assets with a finite life are tested for impairment upon the occurrence of certain triggering events. Derivative financial instruments and hedging activities The Company uses derivative financial instruments to manage currency, commodity, interest rate and equity exposures, arising from its global operating, financing and investing activities (see Note 6). The Company recognizes all derivatives, other than certain derivatives indexed to the Company’s own stock, at fair value in the Consolidated Balance Sheets. Derivatives that are not designated as hedging instruments are reported at fair value with derivative gains and losses reported through earnings and classified consistent with the nature of the underlying transaction. FINANCIAL REPORT 2024 67 If the derivatives are designated as a hedge, depending on the nature of the hedge, changes in the fair value of the derivatives will either be offset against the change in fair value of the hedged item attributable to the risk being hedged through earnings (in the case of a fair value hedge) or recognized in Accumulated other comprehensive loss until the hedged item is recognized in earnings (in the case of a cash flow hedge). Where derivative financial instruments have been designated as cash flow hedges of forecasted transactions and such forecasted transactions are no longer probable of occurring, hedge accounting is discontinued and any derivative gain or loss previously included in Accumulated other comprehensive loss is reclassified into earnings consistent with the nature of the original forecasted transaction. Gains or losses from derivatives designated as hedging instruments in a fair value hedge are reported through earnings and classified consistent with the nature of the underlying hedged transaction. Certain commercial contracts may grant rights to the Company or the counterparties, or contain other provisions that are considered to be derivatives. Such embedded derivatives are assessed at inception of the contract and depending on their characteristics, accounted for as separate derivative instruments and shown at their fair value in the Consolidated Balance Sheets with changes in their fair value reported in earnings consistent with the nature of the commercial contract to which they relate. Derivatives are classified in the Consolidated Statements of Cash Flows in the same section as the underlying item. Cash flows from the settlement of undesignated derivatives used to manage the risks of different underlying items on a net basis are classified within Net cash provided by operating activities, as the underlying items are primarily operational in nature. Other cash flows on the settlement of derivatives are recorded within Net cash provided by (used in) investing activities. Leases The Company leases primarily real estate, vehicles, machinery and equipment. The Company evaluates if a contract contains a lease at inception of the contract. A contract is or contains a lease if it conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. To determine this, the Company assesses whether, throughout the period of use, it has both the right to obtain substantially all of the economic benefits from the use of the identified asset and the right to direct the use of the identified asset. Leases are classified as either finance or operating, with the classification determining the pattern of expense recognition in the Consolidated Income Statements. Lease expense for operating leases is recorded on a straight-line basis over the lease term. Lease expense for finance leases is separated between amortization of right-of-use assets and lease interest expense. In many cases, the Company’s leases include one or more options to renew, with renewal terms that can extend up to 5 years. The exercise of lease renewal options is at the Company’s discretion. Renewal periods are included in the expected lease term if they are reasonably certain of being exercised by the Company. Certain leases also include options to purchase the leased property. None of the Company’s lease agreements contain material residual value guarantees or material restrictions or covenants. Long-term leases (leases with terms greater than 12 months) are recorded in the Consolidated Balance Sheets at the commencement date of the lease based on the present value of the minimum lease payments. The present value of the lease payments is determined by using the interest rate implicit in the lease if available. As most of the Company’s leases do not provide an implicit rate, the Company’s incremental borrowing rate is used for most leases and is determined for portfolios of leases based on the remaining lease term, currency of the lease, and the internal credit rating of the subsidiary which entered into the lease. Short-term leases (leases with an initial lease term of 12 months or less and where it is reasonably certain that the identified asset will not be leased for a term greater than 12 months) are not recorded in the Consolidated Balance Sheets and are expensed on a straight-line basis over the lease term. The majority of short-term leases relate to real estate and machinery. Assets under operating lease are included in Operating lease right-of-use assets. Operating lease liabilities are reported both as current and non-current operating lease liabilities. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. 68 FINANCIAL REPORT 2024 Assets under finance lease are included in Property, plant and equipment while finance lease liabilities are included in Long-term debt (including Current maturities of long-term debt as applicable). Lease and non-lease components for leases other than real estate are not accounted for separately. Income taxes The Company uses the asset and liability method to account for deferred taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial reporting and the tax bases of assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company records a deferred tax asset when it determines that it is more likely than not that the deduction will be sustained based upon the deduction’s technical merit. Deferred tax assets and liabilities that can be offset against each other are reported on a net basis. A valuation allowance is recorded to reduce deferred tax assets to the amount that is more likely than not to be realized. Deferred taxes are provided on unredeemed retained earnings of the Company’s subsidiaries. However, deferred taxes are not provided on such unredeemed retained earnings to the extent it is expected that the earnings are permanently reinvested. Such earnings may become taxable upon the sale or liquidation of these subsidiaries or upon the remittance of dividends. The Company operates in numerous tax jurisdictions and, as a result, is regularly subject to audit by tax authorities. The Company provides for tax contingencies whenever it is deemed more likely than not that a tax asset has been impaired or a tax liability has been incurred. Contingency provisions are recorded based on the technical merits of the Company’s filing position, considering the applicable tax laws and Organisation for Economic Co ‑ operation and Development (OECD) guidelines and are based on its evaluations of the facts and circumstances as of the end of each reporting period. The Company applies a two ‑ step approach to recognize and measure uncertainty in income taxes. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50 percent likely of being realized upon ultimate settlement. Uncertain tax positions that could be settled against existing loss carryforwards or income tax credits are reported net. Expenses related to tax penalties are classified in the Consolidated Income Statements as Income tax expense while interest thereon is classified as Interest and other finance expense. Current income tax relating to certain items is recognized directly in Accumulated other comprehensive loss and not in earnings. In general, the Company applies the individual items approach when releasing income tax effects from Accumulated other comprehensive loss. Research and development Research and development costs not related to specific customer orders are generally expensed as incurred. Earnings per share Basic earnings per share is calculated by dividing income by the weighted ‑ average number of shares outstanding during the year. Diluted earnings per share is calculated by dividing income by the weighted ‑ average number of shares outstanding during the year, assuming that all potentially dilutive securities were exercised, if dilutive. Potentially dilutive securities comprise outstanding written call options, outstanding options and shares granted subject to certain conditions under the Company’s share ‑ based payment arrangements. See further discussion related to earnings per share in Note 21 and of potentially dilutive securities in Note 19. FINANCIAL REPORT 2024 69 Fair value measures The Company uses fair value measurement principles to record certain financial assets and liabilities on a recurring basis and, when necessary, to record certain non ‑ financial assets at fair value on a non ‑ recurring basis, as well as to determine fair value disclosures for certain financial instruments carried at amortized cost in the financial statements. Financial assets and liabilities recorded at fair value on a recurring basis include foreign currency, commodity and interest rate derivatives, as well as available ‑ for ‑ sale securities. Non ‑ financial assets recorded at fair value on a non ‑ recurring basis include long ‑ lived assets that are reduced to their estimated fair value due to impairments. Fair value is the price that would be received when selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Company uses various valuation techniques including the market approach (using observable market data for identical or similar assets and liabilities), the income approach (discounted cash flow method) and the cost approach (using costs a market participant would incur to develop a comparable asset). Inputs used to determine the fair value of assets and liabilities are defined by a three ‑ level hierarchy, depending on the nature of those inputs. The Company has categorized its financial assets and liabilities and non ‑ financial assets measured at fair value within this hierarchy based on whether the inputs to the valuation technique are observable or unobservable. An observable input is based on market data obtained from independent sources, while an unobservable input reflects the Company’s assumptions about market data. The levels of the fair value hierarchy are as follows: Level 1: Valuation inputs consist of quoted prices in an active market for identical assets or liabilities (observable quoted prices). Assets and liabilities valued using Level 1 inputs include exchange ‑ traded equity securities, listed derivatives which are actively traded such as commodity futures, interest rate futures and certain actively traded debt securities. Level 2: Valuation inputs consist of observable inputs (other than Level 1 inputs) such as actively quoted prices for similar assets, quoted prices in inactive markets and inputs other than quoted prices such as interest rate yield curves, credit spreads, or inputs derived from other observable data by interpolation, correlation, regression or other means. The adjustments applied to quoted prices or the inputs used in valuation models may be both observable and unobservable. In these cases, the fair value measurement is classified as Level 2 unless the unobservable portion of the adjustment or the unobservable input to the valuation model is significant, in which case the fair value measurement would be classified as Level 3. Assets and liabilities valued or disclosed using Level 2 inputs include investments in certain funds, certain debt securities that are not actively traded, interest rate swaps, cross-currency interest rate swaps, commodity swaps, forward foreign exchange contracts, foreign exchange swaps and forward rate agreements, time deposits, as well as financing receivables and debt. Level 3: Valuation inputs are based on the Company’s assumptions of relevant market data (unobservable input). Assets valued or disclosed using Level 3 inputs include insurance contracts and certain private equity investments. Investments in private equity, real estate and collective funds held within the Company’s pension plans are generally valued using the net asset value (NAV) per share as a practical expedient for fair value, provided certain criteria are met. The NAVs are determined based on the fair values of the underlying investments in the funds. These assets are not classified in the fair value hierarchy but are separately disclosed. Whenever quoted prices involve bid ‑ ask spreads, the Company ordinarily determines fair values based on mid ‑ market quotes. When determining fair values based on quoted prices in an active market, the Company considers if the level of transaction activity for the financial instrument has significantly decreased, or would not be considered orderly. In such cases, the resulting changes in valuation techniques would be disclosed. If the market is considered disorderly or if quoted prices are not available, the Company is required to use another valuation technique, such as an income approach. 70 FINANCIAL REPORT 2024 Disclosures about the Company’s fair value measurements of assets and liabilities are included in Note 7. Contingencies The Company is subject to proceedings, litigation or threatened litigation and other claims and inquiries, related to environmental, labor, product, regulatory, tax (other than income tax) and other matters, and is required to assess the likelihood of any adverse judgments or outcomes to these matters, as well as potential ranges of probable losses. A determination of the provision required, if any, for these contingencies is made after analysis of each individual issue, often with assistance from both internal and external legal counsel and technical experts. The required amount of a provision for a contingency of any type may change in the future due to new developments in the particular matter, including changes in the approach to its resolution. The Company records a provision for its contingent obligations when it is probable that a loss will be incurred and the amount can be reasonably estimated. Any such provision is generally recognized on an undiscounted basis using the Company’s best estimate of the amount of loss incurred or at the lower end of an estimated range when a single best estimate is not determinable. In some cases, the Company may be able to recover a portion of the costs relating to these obligations from insurers or other third parties; however, the Company records such amounts only when it is probable that they will be collected. The Company generally provides for anticipated costs for warranties when it delivers the related products. Warranty costs include calculated costs arising from imperfections in design, material and workmanship in the Company’s products. The Company makes individual assessments on contracts with risks resulting from order ‑ specific conditions or guarantees and assessments on an overall, statistical basis for similar products sold in larger quantities. The Company may have legal obligations to perform environmental clean ‑ up activities related to land and buildings as a result of the normal operations of its business. In some cases, the timing or the method of settlement, or both, are conditional upon a future event that may or may not be within the control of the Company, but the underlying obligation itself is unconditional and certain. The Company recognizes a provision for these obligations when it is probable that a liability for the clean ‑ up activity has been incurred and a reasonable estimate of its fair value can be made. In some cases, a portion of the costs expected to be incurred to settle these matters may be recoverable. An asset is recorded when it is probable that such amounts are recoverable. Provisions for environmental obligations are not discounted to their present value when the timing of payments cannot be reasonably estimated. Pensions and other postretirement benefits The Company has a number of defined benefit pension plans, defined contribution pension plans and termination indemnity plans. For plans accounted for as a defined benefit pension plan, the Company recognizes an asset for such a plan’s overfunded status or a liability for such a plan’s underfunded status in its Consolidated Balance Sheets. Additionally, the Company measures such a plan’s assets and obligations that determine its funded status as of the end of the year and recognizes the changes in the funded status in the year in which the changes occur. Those changes are reported in Accumulated other comprehensive loss. The Company uses actuarial valuations to determine its pension and postretirement benefit costs and credits. The amounts calculated depend on a variety of key assumptions, including discount rates and expected return on plan assets. Current market conditions are considered in selecting these assumptions. The Company’s various pension plan assets are assigned to their respective levels in the fair value hierarchy in accordance with the valuation principles described in the “Fair value measures” section above. See Note 18 for further discussion of the Company’s employee benefit plans. Business combinations The Company accounts for assets acquired and liabilities assumed in business combinations using the acquisition method and records these at their respective fair values. Contingent consideration is recorded at fair value as an element of purchase price with subsequent adjustments recognized in income. Acquired contract assets and liabilities are valued and recorded in accordance with the principles for recognizing revenues from contracts with customers as outlined in the section entitled “Revenue recognition” above. FINANCIAL REPORT 2024 71 Identifiable intangibles consist of intellectual property such as trademarks and trade names, customer relationships, patented and unpatented technology, in ‑ process research and development, order backlog and capitalized software; these are amortized over their estimated useful lives. Such intangibles are subsequently subject to evaluation for potential impairment if events or circumstances indicate the carrying amount may not be recoverable. See “Goodwill and intangible assets” above. Acquisition ‑ related costs are recognized separately from the acquisition and expensed as incurred. Upon gaining control of an entity in which an equity method or cost basis investment was held by the Company, the carrying value of that investment is adjusted to fair value with the related gain or loss recorded in income. Deferred tax assets and liabilities based on temporary differences between the financial reporting and the tax base of assets and liabilities, as well as uncertain tax positions and valuation allowances on acquired deferred tax assets assumed in connection with a business combination, are initially estimated as of the acquisition date based on facts and circumstances that existed at the acquisition date. Changes in deferred taxes, uncertain tax positions and valuation allowances on acquired deferred tax assets that occur after the measurement period are recognized in income. Estimated fair values of acquired assets and liabilities are subject to change within the measurement period (a period of up to 12 months after the acquisition date during which the acquirer may adjust the provisional acquisition amounts) with any adjustments to the preliminary estimates being recorded to goodwill. New accounting pronouncements Applicable for current period Improvements to reportable segment disclosures In January 2024, the Company adopted an accounting standard update which requires the Company to disclose additional reportable segment information primarily through enhanced disclosures about significant segment expenses and extending certain annual disclosure requirements to a quarterly frequency. The Company applied this update retrospectively for all periods presented in its Consolidated Financial Statements (see Note 24 for details). Other than these additional disclosures, this update did not have a significant impact on the Company’s Consolidated Financial Statements. Applicable for future periods Improvements to income tax disclosures In December 2023, an accounting standard update was issued which requires the Company to disclose additional information related to income taxes. Under the update, the Company is required to annually disclose by jurisdiction (i) additional disaggregated information within the tax rate reconciliation and (ii) income taxes paid. This update is effective for the Company prospectively, with retrospective adoption permitted, for annual periods beginning January 1, 2025. The Company is currently evaluating the impact of adopting this update on its Consolidated Financial Statements. Disaggregation of Income Statement Expenses In November 2024, an accounting standard update was issued which requires the Company to disclose additional information for certain types of expenses, including purchases of inventory, employee compensation, depreciation, and amortization, presented in each relevant income statement expense caption (such as cost of sales, selling, general and administrative expenses).This update is effective for the Company prospectively, with retrospective adoption permitted, for annual periods beginning January 1, 2027 and interim periods beginning January 1, 2028. The Company is currently evaluating the impact of adopting this update on its Consolidated Financial Statements. 72 FINANCIAL REPORT 2024 — Note 3 Discontinued operations In 2020, the Company completed the divestment of its Power Grids business to Hitachi Ltd (Hitachi). As this divestment represented a strategic shift that would have a major effect on the Company’s operations and financial results, the results of operations for this business were presented as discontinued operations. Certain of the business contracts in the Power Grids business continue to be executed by subsidiaries of the Company for the benefit/risk of Hitachi Energy Ltd (Hitachi Energy). The remaining business activities of the Power Grids business being executed by the Company are not significant. Upon closing of the sale, the Company entered into various transition services agreements (TSAs), some of which continue to have services performed. Pursuant to these TSAs, the Company and Hitachi Energy provide to each other, on a transitional basis, various services. The services provided by the Company primarily include finance, information technology, human resources and certain other administrative services. The TSAs were to be performed for up to 3 years with the possibility to agree on extensions on an exceptional basis for business-critical services which are reasonably necessary to avoid a material adverse impact on the business. The TSA for information technology services was extended until mid-2025. In 2024, 2023 and 2022, the Company recognized, within its continuing operations, general and administrative expenses incurred to perform the TSAs, offset by $45 million, $121 million and $162 million, respectively, in TSA-related income for such services that is reported in Other income (expense). In addition, the Company also has retained obligations (primarily for environmental and taxes) related to other businesses disposed or otherwise exited that qualified as discontinued operations. Changes to these retained obligations are also included in Loss from discontinued operations, net of tax. — Note 4 Acquisitions, divestments and equity-accounted companies Acquisitions of controlling interests Acquisitions of controlling interests were as follows: ($ in millions, except number of acquired businesses) 2024 2023 2022 Purchase price for acquisitions (net of cash acquired) (1) 583 175 195 Aggregate excess of purchase price over fair value of net assets acquired (2) 428 142 229 Number of acquired businesses 7 7 5 (1) Excluding changes in cost- and equity-accounted companies. (2) Recorded as goodwill (see Note 11). In the table above, the “Purchase price for acquisitions” and “Aggregate excess of purchase price over fair value of net assets acquired” amounts for 2024, relate primarily to the acquisition of the Födisch Group, the SEAM Group and DTN Europe B.V. In 2023, there were no significant acquisitions. Amounts for 2022 primarily relate to InCharge Energy, Inc. (In-Charge). Acquisitions of controlling interests have been accounted for under the acquisition method and have been included in the Company’s Consolidated Financial Statements since the date of acquisition. On October 1, 2024, the Company acquired all the shares of the Födisch Group. The Födisch Group is a worldwide provider of advanced measurement and analytical solutions for the energy and industrial sectors. The cash outflows to complete the transaction amounted to $287 million (net of cash acquired). This acquisition enhances the Process Automation segment offering in continuous emission monitoring systems (CEMS) and bolsters its competitiveness in technology and innovation in this segment. FINANCIAL REPORT 2024 73 On January 26, 2022, the Company increased its ownership in In-Charge to a 60 percent controlling interest through a stock purchase agreement. In-Charge is headquartered in Santa Monica, United States, and is a provider of turn-key commercial electric vehicle charging hardware and software solutions. The resulting cash outflows for the Company amounted to $134 million (net of cash acquired of $4 million). The acquisition expanded the market presence of the E-mobility operating segment, particularly in the North American market. In connection with the acquisition, the Company’s pre-existing 13.2 percent ownership of In-Charge was revalued to fair value and a gain of $32 million was recorded in Other income (expense), net in 2022. The Company entered into an agreement with the remaining noncontrolling shareholders allowing either party to put or call the remaining 40 percent of the shares until 2027. The amount for which either party could exercise their option was dependent on a formula based on revenues. As a result of this agreement, the noncontrolling interest was classified as Redeemable noncontrolling interest (i.e. mezzanine equity) in the Consolidated Balance Sheets and was initially recognized at fair value. In November 2024, the Company reduced its ownership below a controlling interest as both parties simultaneously settled their respective option rights (see “Business divestments and spin-offs” below). While the Company uses its best estimates and assumptions as part of the purchase price allocation process to value assets acquired and liabilities assumed at the acquisition date, the purchase price allocation for acquisitions is preliminary for up to 12 months after the acquisition date and is subject to refinement as more detailed analyses are completed and additional information about the fair values of the acquired assets and liabilities becomes available. Business divestments and spin-offs In November 2024, the Company together with the Niedax Group formed Abnex Inc. (Abnex), a new joint venture company. Under the terms of the agreement, the Company contributed its North American cable tray business to Abnex, in return for a 50 percent ownership interest in the new joint venture. The transaction was executed through the sale of its North American cable tray business, for which the Company recorded a gain of $72 million, in Other income (expense), with a separate acquisition at fair value of the 50 percent investment in Abnex, amounting to $124 million and accounted for using the equity method. The results of operations of the North American cable tray business are included in the continuing operations of the Electrification operating segment for all periods presented through to the date of sale. In September 2024, the Company and the noncontrolling shareholders of In-Charge came to a definitive agreement to terminate their respective put and call options by settling the contracts on a net basis. This agreement, completed in November 2024, resulted in the Company returning a portion of its shares to In - Charge, thereby reducing its direct ownership to approximately 46 percent and thus losing control. This transaction was treated similar to a business divestment and with a separate re-acquisition at fair value of the 46 percent investment (amounting to $69 million) accounted for using the equity method. The Company recorded a loss of $88 million, representing the excess of the carrying value over the estimated fair value of this business, in Other income (expense), in connection with the loss of control. The fair value adjustment on this business was determined using Level 3 inputs and based on a discounted cash flow model considering the expected future results of this business. The loss is based on the net assets of the business at the time of the deemed sale. In 2023, the Company received proceeds (net of transaction costs and cash disposed) of $530 million, relating to divestments of consolidated businesses and recorded gains of $100 million, in Other income (expense), on the sale of such businesses. These are primarily due to the divestment of the Company’s Power Conversion Division to AcBel Polytech Inc., which prior to its sale was part of the Electrification operating segment. 74 FINANCIAL REPORT 2024 The spin-off of the Company’s Turbocharging Division into an independent, publicly traded company, Accelleron Industries AG (Accelleron), was completed through the distribution of common stock of Accelleron to the stockholders of ABB on October 3, 2022. As a result of the spin-off of this Division, the Company distributed net assets of $272 million, net of amounts attributable to noncontrolling interests of $12 million, which was reflected as a reduction in Retained earnings. In addition, total accumulated comprehensive income of $95 million, including the cumulative translation adjustment, was reclassified to Retained earnings. Cash and cash equivalents distributed with Accelleron was $172 million. The results of operations of the Turbocharging Division are included in the continuing operations of the Process Automation operating segment for all periods presented through to the spin-off date. In 2022, Income from continuing operations before taxes included income of $134 million from this Division. In anticipation of the spin-off, the Company granted to a subsidiary of Accelleron access to funds in the form of a short- term intercompany loan. At the spin-off date, this loan, having a principal amount of 300 million Swiss francs ($306 million at the date of spin-off), was due to the Company and subsequently collected in October 2022. Investments in equity-accounted companies In connection with the establishment of the Joint Venture with the Niedax Group in November 2024, the Company obtained a 50 percent interest in Abnex, the resulting new joint venture entity. For accounting purposes, the acquisition of the 50 percent interest has a fair value at the transaction date of $124 million. The fair value was based on a discounted cash flow model considering the expected results of the future business operations of Abnex and using relevant market inputs including a risk-adjusted weighted-average cost of capital. As Abnex is jointly owned and controlled by ABB and the Niedax Group, the investment is accounted for using the equity method. In November 2024, the reduction in the Company’s share ownership and simultaneous loss of control of In - Charge resulted in, for accounting purposes, a separate acquisition of a 46 percent interest in this company. The fair value of this investment at the transaction date amounted to $69 million and is accounted for using the equity method. In connection with the divestment of its Power Grids business to Hitachi in 2020 (see Note 3), the Company initially retained a 19.9 percent interest in the business until December 2022, when the retained investment was sold to Hitachi. During the Company’s period of ownership of the retained 19.9 percent interest, based on its continuing involvement with the Power Grids business, including the membership in its governing board of directors, the Company concluded that it had significant influence over Hitachi Energy. As a result, the investment was accounted for using the equity method through to the date of its sale. In September 2022, the Company and Hitachi agreed terms to sell the Company’s remaining investment in Hitachi Energy to Hitachi and simultaneously settle certain outstanding contractual obligations relating to the initial sale of the Power Grids business, including certain indemnification guarantees (see Note 15). The sale of the remaining investment was completed in December 2022, resulting in cash proceeds of $1,552 million and a gain of $43 million which was recorded in Other income (expense). In 2024, 2023 and 2022, the Company recorded its share of the earnings of investees accounted for under the equity method of accounting in Other income (expense), net, as follows: ($ in millions) 2024 2023 2022 Loss from equity-accounted companies, net of taxes (21) (16) (22) Basis difference amortization (net of deferred income tax benefit) — — (80) Loss from equity-accounted companies (21) (16) (102) FINANCIAL REPORT 2024 75 — Note 5 Cash and equivalents, marketable securities and short-term investments Cash and equivalents and marketable securities and short ‑ term investments consisted of the following: Cash and Marketable equivalents securities Gross Gross and and unrealized unrealized restricted short-term December 31, 2024 ($ in millions) Cost basis gains losses Fair value cash investments Changes in fair value recorded in net income Cash 1,328 1,328 1,328 Time deposits 3,518 3,518 2,998 520 Equity securities 794 22 (2) 814 814 Total 5,640 22 (2) 5,660 4,326 1,334 Of which: —Restricted cash, current 15 Cash and Marketable equivalents securities Gross Gross and and unrealized unrealized restricted short-term December 31, 2023 ($ in millions) Cost basis gains losses Fair value cash investments Changes in fair value recorded in net income Cash 1,449 1,449 1,449 Time deposits 2,923 2,923 2,460 463 Equity securities 1,250 32 1,282 1,282 5,622 32 — 5,654 3,909 1,745 Changes in fair value recorded in other comprehensive income Debt securities available-for-sale: —U.S. government obligations 189 2 (8) 183 183 189 2 (8) 183 — 183 Total 5,811 34 (8) 5,837 3,909 1,928 Of which: —Restricted cash, current 18 At December 31, 2024 and 2023, the Company pledged $48 million and $48 million, respectively, of available ‑ for ‑ sale marketable securities as collateral for issued letters of credit and other security arrangements. — Note 6 Derivative financial instruments The Company is exposed to certain currency, commodity and interest rate risks arising from its global operating, financing and investing activities. The Company uses derivative instruments to reduce and manage the economic impact of these exposures. 76 FINANCIAL REPORT 2024 Currency risk Due to the global nature of the Company’s operations, many of its subsidiaries are exposed to currency risk in their operating activities from entering into transactions in currencies other than their functional currency. To manage such currency risks, the Company’s policies require its subsidiaries to hedge their foreign currency exposures from binding sales and purchase contracts denominated in foreign currencies. For forecasted foreign currency denominated sales of standard products and the related foreign currency denominated purchases, the Company’s policy is to hedge up to a maximum of 100 percent of the forecasted foreign currency denominated exposures, depending on the length of the forecasted exposures. Forecasted exposures greater than 12 months are not hedged. Forward foreign exchange contracts are the main instrument used to protect the Company against the volatility of future cash flows (caused by changes in exchange rates) of contracted and forecasted sales and purchases denominated in foreign currencies. In addition, within its treasury operations, the Company primarily uses foreign exchange swaps and forward foreign exchange contracts to manage the currency and timing mismatches arising in its liquidity management activities. Commodity risk Various commodity products are used in the Company’s manufacturing activities. Consequently, it is exposed to volatility in future cash flows arising from changes in commodity prices. To manage the price risk of commodities, the Company’s policies require that its subsidiaries hedge the commodity price risk exposures from binding contracts, as well as at least 50 percent (up to a maximum of 100 percent) of the forecasted commodity exposure over the next 12 months or longer (up to a maximum of 18 months). Primarily swap contracts are used to manage the associated price risks of commodities. Interest rate risk The Company has issued bonds at fixed rates. Interest rate swaps and cross-currency interest rate swaps are used to manage the interest rate and foreign currency risk associated with certain debt and generally such swaps are designated as fair value hedges. In addition, from time to time, the Company uses instruments such as interest rate swaps, interest rate futures, bond futures or forward rate agreements to manage interest rate risk arising from the Company’s balance sheet structure but does not designate such instruments as hedges. Volume of derivative activity In general, while the Company’s primary objective in its use of derivatives is to minimize exposures arising from its business, certain derivatives are designated and qualify for hedge accounting treatment while others either are not designated or do not qualify for hedge accounting. Foreign exchange and interest rate derivatives The gross notional amounts of outstanding foreign exchange and interest rate derivatives (whether designated as hedges or not) were as follows: Type of derivative Total notional amounts at December 31, ($ in millions) 2024 2023 2022 Foreign exchange contracts 12,800 12,335 13,509 Embedded foreign exchange derivatives 1,159 1,137 933 Cross-currency interest rate swaps 833 886 855 Interest rate contracts 1,510 1,606 2,830 FINANCIAL REPORT 2024 77 Derivative commodity contracts The Company uses derivatives to hedge its direct or indirect exposure to the movement in the prices of commodities which are primarily copper, silver, steel and aluminum. The following table shows the notional amounts of outstanding derivatives (whether designated as hedges or not), on a net basis, to reflect the Company’s requirements for these commodities: Total notional amounts at December 31, Type of derivative Unit 2024 2023 2022 Copper swaps metric tonnes 40,699 35,015 29,281 Silver swaps ounces 2,648,681 2,359,363 2,012,213 Steel swaps metric tonnes 20,185 10,206 — Aluminum swaps metric tonnes 4,525 5,900 6,825 Cash flow hedges As noted above, the Company mainly uses forward foreign exchange contracts to manage the foreign exchange risk of its operations and commodity swaps to manage its commodity risks. The Company applies cash flow hedge accounting in only limited cases. In these cases, the effective portion of the changes in their fair value is recorded in Accumulated other comprehensive loss and subsequently reclassified into earnings in the same line item and in the same period as the underlying hedged transaction affects earnings. In 2024, 2023 and 2022, there were no significant amounts recorded for cash flow hedge accounting activities. Fair value hedges To reduce its interest rate exposure arising primarily from its debt issuance activities, the Company uses interest rate swaps and cross-currency interest rate swaps. Where such instruments are designated as fair value hedges, the changes in the fair value of these instruments, as well as the changes in the fair value of the risk component of the underlying debt being hedged, are recorded as offsetting gains and losses in Interest and other finance expense. The effect of derivative instruments, designated and qualifying as fair value hedges, on the Consolidated Income Statements was as follows: ($ in millions) 2024 2023 2022 Gains (losses) recognized in Interest and other finance expense: Interest rate contracts Designated as fair value hedges 28 44 (91) Hedged item (29) (45) 93 Cross-currency Designated as fair value hedges 33 30 (134) interest rate swaps Hedged item (30) (40) 135 Derivatives not designated in hedge relationships Derivative instruments that are not designated as hedges or do not qualify as either cash flow or fair value hedges are economic hedges used for risk management purposes. Gains and losses from changes in the fair values of such derivatives are recognized in the same line in the income statement as the economically hedged transaction. Furthermore, under certain circumstances, the Company is required to split and account separately for foreign currency derivatives that are embedded within certain binding sales or purchase contracts denominated in a currency other than the functional currency of the subsidiary and the counterparty. 78 FINANCIAL REPORT 2024 The gains (losses) recognized in the Consolidated Income Statements on derivatives not designated in hedging relationships were as follows: ($ in millions) Gains (losses) recognized in income Type of derivative not designated as a hedge Location 2024 2023 2022 Foreign exchange contracts Total revenues (262) 145 (56) Total cost of sales 77 (71) 21 SG&A expenses (1) 35 27 27 Non-order related research and development — (7) — Interest and other finance expense 282 (240) (128) Embedded foreign exchange contracts Total revenues 27 18 (3) Total cost of sales (6) 1 (11) Commodity contracts Total cost of sales 14 (3) (47) Other Interest and other finance expense (1) 1 4 Total 166 (129) (193) (1) SG&A expenses represent “Selling, general and administrative expenses”. The fair values of derivatives included in the Consolidated Balance Sheets were as follows: Derivative assets Derivative liabilities Current in Non-current Current in Non-current “Other in “Other “Other in “Other current non-current current non-current December 31, 2024 ($ in millions) assets” assets” liabilities” liabilities” Derivatives designated as hedging instruments: Foreign exchange contracts — — 1 — Interest rate contracts — 7 — — Cross-currency interest rate swaps — — — 256 Other 4 — — — Total 4 7 1 256 Derivatives not designated as hedging instruments: Foreign exchange contracts 151 17 111 15 Commodity contracts 4 — 20 — Embedded foreign exchange derivatives 22 6 11 5 Other — 5 — — Total 177 28 142 20 Total fair value 181 35 143 276 FINANCIAL REPORT 2024 79 Derivative assets Derivative liabilities Current in Non-current Current in Non-current “Other in “Other “Other in “Other current non-current current non-current December 31, 2023 ($ in millions) assets” assets” liabilities” liabilities” Derivatives designated as hedging instruments: Foreign exchange contracts — — 5 2 Interest rate contracts — — 18 — Cross-currency interest rate swaps — — — 230 Other 10 — — — Total 10 — 23 232 Derivatives not designated as hedging instruments: Foreign exchange contracts 123 30 177 9 Commodity contracts 8 — 3 — Interest rate contracts 1 — 1 — Embedded foreign exchange derivatives 23 5 26 5 Other 4 — — — Total 159 35 207 14 Total fair value 169 35 230 246 Close ‑ out netting agreements provide for the termination, valuation and net settlement of some or all outstanding transactions between two counterparties on the occurrence of one or more pre ‑ defined trigger events. Although the Company is party to close ‑ out netting agreements with most derivative counterparties, the fair values in the tables above and in the Consolidated Balance Sheets at December 31, 2024 and 2023, have been presented on a gross basis. The Company’s netting agreements and other similar arrangements allow net settlements under certain conditions. At December 31, 2024 and 2023, information related to these offsetting arrangements was as follows: December 31, 2024 ($ in millions) Gross amount of Derivative liabilities Cash Non-cash Type of agreement or recognized eligible for set-off in collateral collateral Net asset similar arrangement assets case of default received received exposure Derivatives 188 (90) — — 98 Total 188 (90) — — 98 December 31, 2024 ($ in millions) Gross amount of Derivative liabilities Cash Non-cash Type of agreement or recognized eligible for set-off in collateral collateral Net liability similar arrangement liabilities case of default pledged pledged exposure Derivatives 403 (90) — — 313 Total 403 (90) — — 313 80 FINANCIAL REPORT 2024 December 31, 2023 ($ in millions) Gross amount of Derivative liabilities Cash Non-cash Type of agreement or recognized eligible for set-off in collateral collateral Net asset similar arrangement assets case of default received received exposure Derivatives 176 (111) — — 65 Total 176 (111) — — 65 December 31, 2023 ($ in millions) Gross amount of Derivative liabilities Cash Non-cash Type of agreement or recognized eligible for set-off in collateral collateral Net liability similar arrangement liabilities case of default pledged pledged exposure Derivatives 445 (111) — — 334 Total 445 (111) — — 334 — Note 7 Fair values Recurring fair value measures The fair values of financial assets and liabilities measured at fair value on a recurring basis were as follows: Total December 31, 2024 ($ in millions) Level 1 Level 2 Level 3 fair value Assets Securities in “Marketable securities and short-term investments”: Equity securities — 814 — 814 Derivative assets—current in “Other current assets” — 181 — 181 Derivative assets—non-current in “Other non-current assets” — 35 — 35 Total — 1,030 — 1,030 Liabilities Derivative liabilities—current in “Other current liabilities” — 143 — 143 Derivative liabilities—non-current in “Other non-current liabilities” — 276 — 276 Total — 419 — 419 Total December 31, 2023 ($ in millions) Level 1 Level 2 Level 3 fair value Assets Securities in “Marketable securities and short-term investments”: Equity securities — 1,282 — 1,282 Debt securities—U.S. government obligations 183 — — 183 Derivative assets—current in “Other current assets” — 169 — 169 Derivative assets—non-current in “Other non-current assets” — 35 — 35 Total 183 1,486 — 1,669 Liabilities Derivative liabilities—current in “Other current liabilities” — 230 — 230 Derivative liabilities—non-current in “Other non-current liabilities” — 246 — 246 Total — 476 — 476 During 2024, 2023 and 2022, there have been no reclassifications for any financial assets or liabilities between Level 1 and Level 2. FINANCIAL REPORT 2024 81 The Company uses the following methods and assumptions in estimating fair values of financial assets and liabilities measured at fair value on a recurring basis: • Securities in “Marketable securities and short ‑ term investments”: If quoted market prices in active markets for identical assets are available, these are considered Level 1 inputs; however, when markets are not active, these inputs are considered Level 2. If such quoted market prices are not available, fair value is determined using market prices for similar assets or present value techniques, applying an appropriate risk ‑ free interest rate adjusted for non ‑ performance risk. The inputs used in present value techniques are observable and fall into the Level 2 category. • Derivatives: The fair values of derivative instruments are determined using quoted prices of identical instruments from an active market, if available (Level 1 inputs). If quoted prices are not available, price quotes for similar instruments, appropriately adjusted, or present value techniques, based on available market data, or option pricing models are used. The fair values obtained using price quotes for similar instruments or valuation techniques represent a Level 2 input unless significant unobservable inputs are used. Non ‑ recurring fair value measures In the year ended 2024, the Company recognized $113 million of fair value adjustments on assets and liabilities held for sale. These primarily relate to a fair value adjustment within the E-mobility Division of $88 million (see Note 4). In the year ended 2024, the Company also recognized $88 million in fair value adjustments of equity investments, primarily related to an impairment recorded of our investment in Northvolt AB. There were no other significant non ‑ recurring fair value measurements during the years ended 2024, 2023 and 2022. Disclosure about financial instruments carried on a cost basis The fair values of financial instruments carried on a cost basis were as follows: Carrying Total December 31, 2024 ($ in millions) value Level 1 Level 2 Level 3 fair value Assets Cash and equivalents (excluding securities with original maturities up to 3 months): Cash 1,313 1,313 — — 1,313 Time deposits 2,998 — 2,998 — 2,998 Restricted cash 15 15 — — 15 Marketable securities and short-term investments (excluding securities): Time deposits 520 — 520 — 520 Liabilities Short-term debt and current maturities of long-term debt (excluding finance lease obligations) 265 188 77 — 265 Long-term debt (excluding finance lease obligations) 6,486 6,012 551 — 6,563 82 FINANCIAL REPORT 2024 Carrying Total December 31, 2023 ($ in millions) value Level 1 Level 2 Level 3 fair value Assets Cash and equivalents (excluding securities with original maturities up to 3 months): Cash 1,431 1,431 — — 1,431 Time deposits 2,460 — 2,460 — 2,460 Restricted cash 18 18 — — 18 Marketable securities and short-term investments (excluding securities): Time deposits 463 — 463 — 463 Liabilities Short-term debt and current maturities of long-term debt (excluding finance lease obligations) 2,576 2,521 55 — 2,576 Long-term debt (excluding finance lease obligations) 5,060 5,096 5 — 5,101 The Company uses the following methods and assumptions in estimating fair values of financial instruments carried on a cost basis: • Cash and equivalents (excluding securities with original maturities up to 3 months), Restricted cash and Marketable securities and short ‑ term investments (excluding securities): The carrying amounts approximate the fair values as the items are short ‑ term in nature or, for cash held in banks, are equal to the deposit amount. • Short ‑ term debt and current maturities of long ‑ term debt (excluding finance lease obligations): Short ‑ term debt includes commercial paper, bank borrowings and overdrafts. The carrying amounts of short ‑ term debt and current maturities of long ‑ term debt, excluding finance lease obligations, approximate their fair values. • Long ‑ term debt (excluding finance lease obligations): Fair values of bonds are determined using quoted market prices (Level 1 inputs), if available. For bonds without available quoted market prices and other long ‑ term debt, the fair values are determined using a discounted cash flow methodology based upon borrowing rates of similar debt instruments and reflecting appropriate adjustments for non ‑ performance risk (Level 2 inputs). — Note 8 Receivables, net and Contract assets and liabilities Receivables consisted of the following: December 31, ($ in millions) 2024 2023 Trade receivables 7,114 7,107 Other receivables 590 646 Allowance (316) (307) Total 7,388 7,446 “Trade receivables” in the table above includes contractual retention amounts billed to customers of $106 million and $104 million at December 31, 2024 and 2023, respectively. Management expects that the substantial majority of related contracts will be completed and the substantial majority of the billed amounts retained by the customer will be collected. Of the retention amounts outstanding at December 31, 2024, 60 percent and 19 percent are expected to be collected in 2025 and 2026, respectively. “Other receivables” in the table above consists of value added tax, claims, rental deposits and other non ‑ trade receivables. FINANCIAL REPORT 2024 83 The reconciliation of changes in the allowance for doubtful accounts is as follows: ($ in millions) 2024 2023 2022 Balance at January 1, 307 308 339 Current-period provision for expected credit losses 49 47 37 Write-offs charged against the allowance (25) (48) (48) Exchange rate differences (15) — (20) Balance at December 31, 316 307 308 The following table provides information about Contract assets and Contract liabilities: December 31, ($ in millions) 2024 2023 2022 Contract assets 1,115 1,090 954 Contract liabilities 2,969 2,844 2,216 Contract assets primarily relate to the Company’s right to receive consideration for work completed but for which no invoice has been issued at the reporting date. Contract assets are transferred to receivables when rights to receive payment become unconditional. Management expects that the majority of the amounts will be collected within one year of the respective balance sheet date. Contract liabilities primarily relate to up-front advances received on orders from customers as well as amounts invoiced to customers in excess of revenues recognized predominantly on long-term projects. Contract liabilities are reduced as work is performed and as revenues are recognized. The significant changes in the Contract assets and Contract liabilities balances were as follows: 2024 2023 Contract Contract Contract Contract ($ in millions) assets liabilities assets liabilities Revenue recognized, which was included in the Contract liabilities balance at January 1, 2024/2023 (1,543) (1,311) Additions to Contract liabilities - excluding amounts recognized as revenue during the period 1,814 1,845 Receivables recognized that were included in the Contract assets balance at January 1, 2024/2023 (592) (622) The Company considers its order backlog to represent its unsatisfied performance obligations. At December 31, 2024, the Company had unsatisfied performance obligations totaling $21,221 million and, of this amount, the Company expects to fulfill approximately 70 percent of the obligations in 2025, approximately 16 percent of the obligations in 2026 and the balance thereafter. — Note 9 Inventories, net Inventories consisted of the following: December 31, ($ in millions) 2024 2023 Raw materials 2,364 2,546 Work in process 1,223 1,284 Finished goods 2,026 2,092 Advances to suppliers 246 227 Total 5,859 6,149 84 FINANCIAL REPORT 2024 — Note 10 Property, plant and equipment, net Property, plant and equipment consisted of the following: December 31, ($ in millions) 2024 2023 Land and buildings 3,778 3,818 Machinery and equipment 5,738 5,847 Construction in progress 690 713 10,206 10,378 Accumulated depreciation (6,029) (6,236) Total 4,177 4,142 Assets under finance leases included in Property, plant and equipment, net were as follows: December 31, ($ in millions) 2024 2023 Land and buildings 222 208 Machinery and equipment 107 95 329 303 Accumulated depreciation (154) (137) Total 175 166 In 2024, 2023 and 2022, depreciation, including depreciation of assets under finance leases, was $550 million, $517 million and $531 million, respectively. In 2024, 2023 and 2022, there were no significant impairments of property, plant or equipment. — Note 11 Goodwill and intangible assets The changes in Goodwill were as follows: Robotics & Process Discrete Corporate ($ in millions) Electrification Motion Automation Automation and Other Total Balance at January 1, 2023 (1) 4,125 2,118 1,587 2,208 473 10,511 Goodwill acquired during the year (2) 41 38 — 49 14 142 Goodwill allocated to disposals (181) — (12) — — (193) Exchange rate differences and other 45 3 8 45 — 101 Balance at December 31, 2023 (1) 4,030 2,159 1,583 2,302 487 10,561 Goodwill acquired during the year (2) 101 5 315 3 4 428 Goodwill allocated to disposals (13) — — — (208) (221) Exchange rate differences and other (94) (8) (30) (78) (3) (213) Balance at December 31, 2024 (1) 4,024 2,156 1,868 2,227 280 10,555 (1) At December 31, 2024 and 2023, and at January 1, 2023, the gross goodwill amounted to $10,811 million, $10,833 million and $10,774 million, respectively. The accumulated impairment charges amounted to $256 million, $272 million and $263 million, respectively, and related to the Robotics & Discrete Automation operating segment. (2) Amount includes adjustments arising during the twelve-month measurement period subsequent to the respective acquisition date. FINANCIAL REPORT 2024 85 In 2024, goodwill acquired primarily relates to the SEAM Group (acquired in July 2024) and Födisch Group (acquired in October 2024), which have been allocated to Electrification and Process Automation operating segments, respectively. In 2024, goodwill allocated to disposals primarily relates to goodwill attributed to the reduction in the Company‘s ownership interest in InCharge Energy, Inc. which, prior to the change in ownership interest, was part of the E-mobility operating segment, within Corporate and Other. Intangible assets consisted of the following: 2024 2023 Gross Accumu- Net Gross Accumu- Net carrying lated amort- carrying carrying lated amort- carrying December 31, ($ in millions) amount ization amount amount ization amount Capitalized software for internal use 923 (800) 123 904 (775) 129 Capitalized software for sale 24 (24) — 26 (26) — Intangibles other than software: Customer-related 1,660 (966) 694 1,632 (894) 738 Technology-related 919 (812) 107 1,034 (832) 202 Marketing-related 491 (381) 110 531 (400) 131 Other 45 (31) 14 56 (33) 23 Total 4,062 (3,014) 1,048 4,183 (2,960) 1,223 Additions to intangible assets other than goodwill consisted of the following: ($ in millions) 2024 2023 Capitalized software for internal use 50 70 Intangibles other than software: Customer-related 105 12 Technology-related 36 13 Marketing-related 7 35 Other 2 1 Total 200 131 Included in the additions of $200 million in 2024 were $152 million of intangible assets acquired in business combinations. In 2023 there were no significant intangible assets acquired in business combinations. Amortization expense of intangible assets consisted of the following: ($ in millions) 2024 2023 2022 Capitalized software for internal use 48 44 52 Intangibles other than software 204 219 230 Total 252 263 282 In 2024, 2023 and 2022, impairment charges on intangible assets were not significant. 86 FINANCIAL REPORT 2024 At December 31, 2024, future amortization expense of intangible assets is estimated to be: ($ in millions) 2025 217 2026 195 2027 176 2028 154 2029 93 Thereafter 213 Total 1,048 — Note 12 Supplier Finance Programs The Company has several supplier finance programs, all with similar characteristics, with various financial institutions acting as paying agent. These programs allow qualifying suppliers access to bank facilities which permit earlier payment at a cost to the supplier. The Company’s payment terms related to suppliers’ finance programs are not impacted by the suppliers’ decisions to sell amounts under the arrangements and are typically consistent with local market practices. Outstanding supplier finance obligations are included in Accounts payable, trade in the Consolidated Balance Sheets and are reported as operating or investing (if capitalized) activities in the Consolidated Statement of Cash Flows when paid. At December 31, 2024 and 2023, the total obligation outstanding under supplier finance programs amounted to $435 million and $415 million, respectively. ($ in millions) 2024 Confirmed obligations outstanding at January 1, 415 Invoices confirmed 1,540 Confirmed invoices paid (1,497) Exchange rate differences (23) Confirmed obligations outstanding at December 31, 435 — Note 13 Debt The Company’s total debt at December 31, 2024 and 2023, amounted to $6,945 million and $7,828 million, respectively. Short ‑ term debt and current maturities of long-term debt Short ‑ term debt and current maturities of long ‑ term debt consisted of the following: December 31, ($ in millions) 2024 2023 Short-term debt (weighted-average interest rate of 4.7% and 5.1%, respectively) 83 87 Current maturities of long-term debt (weighted-average nominal interest rate of 2.3% and 1.5%, respectively) 210 2,520 Total 293 2,607 Short ‑ term debt primarily represents short ‑ term loans from various banks and issued commercial paper. FINANCIAL REPORT 2024 87 At December 31, 2024, the Company had two commercial paper programs in place: a $2 billion Euro ‑ commercial paper program for the issuance of commercial paper in a variety of currencies, and a $2 billion commercial paper program for the private placement of U.S. dollar denominated commercial paper in the United States. At both December 31, 2024 and 2023, no amount was outstanding under either program. In December 2019, the Company replaced its previous multicurrency revolving credit facility with a new $2 billion multicurrency revolving credit facility maturing in 2024. In 2021, the Company exercised its option to extend the maturity of this facility to 2026. The facility is for general corporate purposes. In 2023, the Company amended and restated its facility for the purpose of addressing the discontinuation of LIBOR. Under the amended and restated credit facility, interest costs on drawings under the facility (i) in USD are referenced to CME Term SOFR; (ii) in CHF and GBP are referenced to overnight SARON and SONIA, respectively; and (iii) in Euro are referenced to EURIBOR, subject to applicable credit adjustment spreads (for only (i) and (ii) above), plus a margin of 0.175 percent, while commitment fees (payable on the unused portion of the facility) amount to 35 percent of the margin, which represents commitment fees of 0.06125 percent per annum. Utilization fees, payable on drawings, amount to 0.075 percent per annum on drawings up to one ‑ third of the facility, 0.15 percent per annum on drawings in excess of one ‑ third but less than or equal to two ‑ thirds of the facility, and 0.30 percent per annum on drawings over two ‑ thirds of the facility. The facility contains cross ‑ default clauses whereby an event of default would occur if the Company were to default on indebtedness as defined in the facility, at or above a specified threshold. No amount was drawn at December 31, 2024 and 2023, under this facility. Long ‑ term debt The Company raises long-term debt in various currencies, maturities and on various interest rate terms. For certain of its debt obligations, the Company utilizes derivative instruments to modify its interest rate exposure. In particular, the Company uses interest rate swaps to effectively convert certain fixed ‑ rate long ‑ term debt into floating rate obligations. For certain non-U.S. dollar denominated debt, the Company utilizes cross-currency interest rate swaps to effectively convert the debt into a U.S. dollar obligation. The carrying value of debt, designated as being hedged by fair value hedges, is adjusted for changes in the fair value of the risk component of the debt being hedged. The following table summarizes the Company’s long ‑ term debt considering the effect of interest rate and cross-currency interest rate swaps. Consequently, a fixed ‑ rate debt subject to a fixed ‑ to ‑ floating interest rate swap is included as a floating rate debt in the table below: 2024 2023 December 31, Nominal Effective Nominal Effective ($ in millions, except % data) Balance rate rate Balance rate rate Floating rate 1,807 2.5% 5.0% 2,907 1.3% 4.8% Fixed rate 5,055 2.8% 2.8% 4,834 2.6% 2.7% 6,862 7,741 Current portion of long-term debt (210) 2.3% 2.2% (2,520) 1.5% 3.7% Total 6,652 5,221 At December 31, 2024, the principal amounts of long ‑ term debt repayable (excluding finance lease obligations) at maturity were as follows: ($ in millions) 2025 183 2026 364 2027 990 2028 548 2029 708 Thereafter 4,013 Total 6,806 88 FINANCIAL REPORT 2024 Details of significant long-term borrowings were as follows: 2024 2023 December 31, (in millions) Nominal Carrying Nominal Carrying outstanding value (1) outstanding value (1) Bonds: 0.625% EUR Instruments, due 2024 EUR 700 $ 768 Floating Rate EUR Instruments, due 2024 EUR 500 $ 554 0.75% EUR Instruments, due 2024 EUR 750 $ 819 0.3% CHF Bonds, due 2024 CHF 280 $ 335 2.1% CHF Bonds, due 2025 CHF 150 $ 166 CHF 150 $ 179 1.965% CHF Bonds, due 2026 CHF 325 $ 359 CHF 325 $ 387 3.25% EUR Instruments, due 2027 EUR 500 $ 518 EUR 500 $ 551 0.75% CHF Bonds, due 2027 CHF 425 $ 468 CHF 425 $ 507 3.8% USD Notes, due 2028 (2) USD 383 $ 382 USD 383 $ 382 1.9775% CHF Bonds, due 2028 CHF 150 $ 165 CHF 150 $ 179 3.125% EUR Instruments, due 2029 EUR 500 $ 523 1.0% CHF Bonds, due 2029 CHF 170 $ 188 CHF 170 $ 203 0% EUR Instruments, due 2030 EUR 800 $ 727 EUR 800 $ 749 2.375% CHF Bonds, due 2030 CHF 150 $ 165 CHF 150 $ 178 3.375% EUR Instruments, due 2031 EUR 750 $ 770 EUR 750 $ 818 Floating rate EIB R&D Loan, due 2031 USD 539 $ 539 2.1125% CHF Bonds, due 2033 CHF 275 $ 303 CHF 275 $ 327 3.375% EUR Instruments, due 2034 EUR 750 $ 780 4.375% USD Notes, due 2042 (2) USD 609 $ 591 USD 609 $ 591 Total $ 6,644 $ 7,527 (1) USD carrying values include unamortized debt issuance costs, bond discounts or premiums, as well as adjustments for fair value hedge accounting, where appropriate. (2) Prior to completing a cash tender offer in 2020, the original principal amount outstanding, on each of the 3.8% USD Notes, due 2028, and the 4.375% USD Notes, due 2042, was $750 million. During 2024, the Company repaid at maturity its CHF 280 million 0.3% Bonds, its EUR 750 million 0.75% EUR Instruments, and its EUR 700 million 0.625% EUR Instruments, each paid interest annually in arrears, as well as its EUR 500 million floating rate notes, which paid interest quarterly in arrears at a variable rate of 0.7 percentage points above the 3-month EURIBOR, subject to a minimum rate of interest of zero percent. The CHF 150 million 2.1% Bonds, due 2025, and the CHF 150 million 2.375% Bonds, due 2030, both pay interest annually in arrears. The Company may redeem these bonds, three months prior to maturity, in whole but not in part, at par plus accrued interest. Further, the Company has the option to redeem these instruments prior to maturity, in whole but not in part, at par plus accrued interest, if 85 percent or more of the aggregate principal amount of the relevant bond issue has been redeemed or purchased and cancelled at the time of the option exercise notice. The CHF 325 million 1.965% Bonds, due 2026, the CHF 150 million 1.9775% Bonds, due 2028, and the CHF 275 million 2.1125% Bonds, due 2033, all pay interest annually in arrears and have the same early redemption terms as the CHF 150 million 2.1% Bonds above. The EUR 500 million 3.25% Instruments, due 2027, and EUR 750 million 3.375% Instruments, due 2031, both pay interest annually in arrears. The Company may redeem the EUR 500 million Instruments up to one month prior to maturity (Par call date) and the EUR 750 million Instruments up to three months prior to maturity (Par call date), at the greater of (i) 100 percent of the principal amount of the notes to be redeemed and (ii) the sum of the present values of remaining scheduled payments of principal and interest (excluding interest accrued to the redemption date) discounted to the redemption date at a rate defined in the note terms, plus interest accrued at the redemption date. The Company may also redeem these instruments, after the Par call date, at 100 percent of the principal amount of the notes to be redeemed plus accrued interest. FINANCIAL REPORT 2024 89 The CHF 425 million 0.75% Bonds, due 2027, pay interest annually in arrears. The Company may redeem the Bonds, one month prior to maturity, in whole but not in part, at par plus accrued interest. Further, the Company has the option to redeem these instruments prior to maturity, in whole but not in part, at par plus accrued interest, if 85 percent or more of the aggregate principal amount have been redeemed or purchased and cancelled at the time of the option exercise notice. The 3.8% USD Notes, due 2028, were issued in April 2018 and pay interest semi ‑ annually in arrears. During 2020 by way of a cash tender offer, the Company redeemed $367 million of the original $750 million 3.8% USD Notes, due 2028, issued. The Company may redeem the remaining principal outstanding of the 2028 Notes up to three months prior to their maturity date, in whole or in part, at the greater of (i) 100 percent of the principal amount of the notes to be redeemed and (ii) the sum of the present values of remaining scheduled payments of principal and interest (excluding interest accrued to the redemption date) discounted to the redemption date at a rate defined in the Notes terms, plus interest accrued at the redemption date. On or after January 3, 2028 (three months prior to their maturity date), the Company may also redeem the 2028 Notes, in whole or in part, at any time at a redemption price equal to 100 percent of the principal amount of the notes to be redeemed plus unpaid accrued interest to, but excluding, the redemption date. The CHF 170 million 1.0% Bonds, due 2029, pay interest annually in arrears and have the same early redemption terms as the CHF 150 million 2.1% Bonds above. The EUR 800 million 0% Instruments, due 2030, do not pay interest. The Company may redeem these notes up to three months prior to maturity (Par call date), at the greater of (i) 100 percent of the principal amount of the notes to be redeemed and (ii) the sum of the present values of remaining scheduled payments of principal and interest (excluding interest accrued to the redemption date) discounted to the redemption date at a rate defined in the note terms, plus interest accrued at the redemption date. The Company may redeem these instruments, after the Par call date at 100 percent of the principal amount of the notes to be redeemed. Cross-currency interest rate swaps have been used to modify the characteristics of these instruments. After considering the impact of these cross-currency interest rate swaps, the Company effectively has a floating rate U.S. dollar obligation. The 4.375% USD Notes, due 2042, pay interest semi ‑ annually in arrears. During 2020, by way of a cash tender offer, the Company redeemed $141 million of the original $750 million 4.375% USD Notes, due 2042, issued. The Company may redeem these notes prior to maturity, in whole or in part, at the greater of (i) 100 percent of the principal amount of the notes to be redeemed and (ii) the sum of the present values of remaining scheduled payments of principal and interest (excluding interest accrued to the redemption date) discounted to the redemption date at a rate defined in the note terms, plus interest accrued at the redemption date. In January 2024, the Company issued the following EUR Instruments: (i) EUR 500 million of 3.125% Instruments, due 2029, and (ii) EUR 750 million of 3.375% Instruments, due 2034, both paying interest annually in arrears and have the same early redemption terms as the EUR 500 million 3.25% Instruments, due 2027, and EUR 750 million 3.375% Instruments, due 2031, respectively, above. The aggregate net proceeds of these EUR Instruments, after discount and fees, amounted to EUR 1,243 million (equivalent to approximately $1,360 million on date of issuance). The Company has entered into interest rate swaps for an aggregate nominal amount of EUR 500 million to partially hedge its interest obligations on these two bonds. After considering the impact of such swaps, EUR 500 million ($520 million equivalent) of the outstanding principal is shown as floating rate debt in the table of long-term debt above. In November 2024, the Company obtained a USD 539 million (EUR 500 million equivalent) loan pursuant to an agreement with the European Investment Bank (EIB) that was entered into in 2023. This floating rate loan, due 2031, pays interest semi-annually in arrears at a variable rate of 0.64 percentage points above the 6-month compound SOFR. The Company may repay the amount drawn down at any time, prior to maturity, in whole or in part, at par plus accrued interest and fees, if any. The funds received from this loan are required to be used to finance research and development (R&D) within the Electrification operating segment. The Company’s various debt instruments contain cross ‑ default clauses which would allow the bondholders to demand repayment if the Company were to default on any borrowing at or above a specified threshold. Furthermore, all such bonds constitute unsecured obligations of the Company and rank pari passu with other debt obligations. 90 FINANCIAL REPORT 2024 In addition to the bonds and other borrowings described above, included in long ‑ term debt at December 31, 2024 and 2023, are finance lease obligations, bank borrowings of subsidiaries and other long ‑ term debt, none of which is individually significant. — Note 14 Other provisions, other current liabilities and other non-current liabilities Other provisions consisted of the following: December 31, ($ in millions) 2024 2023 Contract-related provisions 286 523 Provisions for contractual penalties and compliance and litigation matters 134 88 Restructuring and restructuring-related provisions 125 187 Provision for insurance-related reserves 111 183 Other 197 220 Total 853 1,201 Other current liabilities consisted of the following: December 31, ($ in millions) 2024 2023 Employee-related liabilities 1,635 1,566 Accrued expenses 589 788 Non-trade payables 582 631 Accrued customer rebates 486 514 Income taxes payable and other income tax related liabilities 485 668 Other tax liabilities 389 360 Derivative liabilities (see Note 6) 143 230 Accrued interest 121 105 Other 152 184 Total 4,582 5,046 Other non ‑ current liabilities consisted of the following: December 31, ($ in millions) 2024 2023 Income tax related liabilities 847 813 Derivative liabilities (see Note 6) 275 246 Provisions for contractual penalties and compliance and litigation matters 141 160 Other 291 329 Total 1,554 1,548 FINANCIAL REPORT 2024 91 — Note 15 Commitments and contingencies Contingencies—Regulatory, Compliance and Legal Regulatory Based on findings during an internal investigation, the Company self-reported to the Securities and Exchange Commission (SEC) and the Department of Justice (DoJ), in the United States, to the Special Investigating Unit (SIU) and the National Prosecuting Authority (NPA) in South Africa, as well as to various authorities in other countries, potential suspect payments and other compliance concerns in connection with some of the Company’s dealings with Eskom and related persons. Many of those parties have expressed an interest in, or commenced an investigation into, these matters and the Company is cooperating fully with them. The Company paid $104 million to Eskom in December 2020 as part of a full and final settlement with Eskom and the SIU relating to improper payments and other compliance issues associated with the Controls and Instrumentation Contract, and its Variation Orders for Units 1 and 2 at Kusile. The Company made a provision of approximately $325 million, which was recorded in Other income (expense) during the third quarter of 2022. In December 2022, the Company settled with the SEC and DoJ as well as the authorities in South Africa and Switzerland. In March 2024, the Company settled its final pending matter with the authorities in Germany. The Company does not believe that it will need to record any additional provisions for this matter, and has paid all amounts in full. General The Company is aware of proceedings, or the threat of proceedings, against it and others in respect of private claims by customers and other third parties with regard to certain actual or alleged anticompetitive practices. Also, the Company is subject to other claims and legal proceedings, as well as investigations carried out by various law enforcement authorities. With respect to the above-mentioned claims, regulatory matters, and any related proceedings, the Company will bear the related costs, including costs necessary to resolve them. Liabilities recognized At December 31, 2024 and 2023, the Company had aggregate liabilities of $83 million and $101 million, respectively, included in Other provisions and Other non ‑ current liabilities, for the above regulatory, compliance and legal contingencies, and none of the individual liabilities recognized was significant. As it is not possible to make an informed judgment on, or reasonably predict, the outcome of certain matters and as it is not possible, based on information currently available to management, to estimate the maximum potential liability on other matters, there could be adverse outcomes beyond the amounts accrued. Guarantees General The following table provides quantitative data regarding the Company’s third ‑ party guarantees. The maximum potential payments represent a “worst ‑ case scenario”, and do not reflect management’s expected outcomes. Maximum potential payments (1) December 31, ($ in millions) 2024 2023 Performance guarantees 2,299 3,451 Financial guarantees 22 94 Total 2,321 3,545 (1) Maximum potential payments include amounts in both continuing and discontinued operations. The carrying amount of liabilities recorded in the Consolidated Balance Sheets reflects the Company’s best estimate of future payments, which it may incur as part of fulfilling its guarantee obligations. In respect of the above guarantees, the carrying amounts of liabilities at December 31, 2024 and 2023, were not significant. 92 FINANCIAL REPORT 2024 The Company is party to various guarantees providing financial or performance assurances to certain third parties. These guarantees, which have various maturities up to 2034, mainly consist of performance guarantees whereby (i) the Company guarantees the performance of a third party’s product or service according to the terms of a contract and (ii) as member of a consortium/joint venture that includes third parties, the Company guarantees not only its own performance but also the work of third parties. Such guarantees may include guarantees that a project will be completed within a specified time. If the third party does not fulfill the obligation, the Company will compensate the guaranteed party in cash or in kind. The original maturity dates for the majority of these performance guarantees range from one to ten years. In conjunction with the divestment of the high ‑ voltage cable and cables accessories businesses in 2017, the Company has entered into various performance guarantees with other parties with respect to certain liabilities of the divested business. At December 31, 2024 and 2023, the maximum potential payable under these guarantees amounts to $747 million and $874 million, respectively, and these guarantees have various maturities ranging from five to ten years. The Company retained obligations for financial and performance guarantees related to its former Power Grids business (reported as discontinued operations prior to its sale to Hitachi Ltd in 2020), which at both December 31, 2024 and 2023, have been fully indemnified by Hitachi Ltd. These guarantees, having various maturities up to 2034, primarily consist of bank guarantees, standby letters of credit, business performance guarantees and other trade-related guarantees, the majority of which have original maturity dates ranging from one to ten years. The maximum amount payable under these guarantees at December 31, 2024 and 2023, is approximately $1.1 billion and $2.2 billion, respectively. On completing the sale of the Company’s remaining 19.9 percent interest in Hitachi Energy Ltd. to Hitachi Ltd in 2022, the Company also settled certain existing indemnification guarantees that were due to be settled concurrent with such transaction. As a result, in 2022, the Company recorded $136 million of cash outflows for the settlement of these liabilities (recorded in Proceeds from sales of businesses, cost- and equity-accounted companies). Commercial commitments In addition, in the normal course of bidding for and executing certain projects, the Company has entered into standby letters of credit, bid/performance bonds and surety bonds (collectively “performance bonds”) with various financial institutions. Customers can draw on such performance bonds in the event that the Company does not fulfill its contractual obligations. The Company would then have an obligation to reimburse the financial institution for amounts paid under the performance bonds. At December 31, 2024 and 2023, the total outstanding performance bonds aggregated to $3.2 billion and $3.1 billion, respectively. There have been no significant amounts reimbursed to financial institutions under these types of arrangements in 2024 and 2023. Product and order ‑ related contingencies The Company calculates its provision for product warranties based on historical claims experience and specific review of certain contracts. The reconciliation of the Provisions for warranties, including guarantees of product performance, was as follows: ($ in millions) 2024 2023 2022 Balance at January 1, 1,210 1,028 1,005 Net change in warranties due to acquisitions, divestments and spin-offs 2 — (24) Claims paid in cash or in kind (157) (171) (157) Net increase in provision for changes in estimates, warranties issued and warranties expired 256 327 252 Exchange rate differences (63) 26 (48) Balance at December 31, 1,248 1,210 1,028 FINANCIAL REPORT 2024 93 — Note 16 Leases The Company’s lease obligations primarily relate to real estate, machinery and equipment. The components of lease expense were as follows: Machinery Land and buildings and equipment Total ($ in millions) 2024 2023 2022 2024 2023 2022 2024 2023 2022 Operating lease cost 231 221 217 88 73 71 319 294 288 Finance lease cost 20 15 15 20 15 22 40 30 37 Short-term lease cost 12 16 20 4 10 18 16 26 38 Sub-lease income (27) (20) (18) — — (1) (27) (20) (19) Total lease expense 236 232 234 112 98 110 348 330 344 The following table presents supplemental cash flow information related to leases: Machinery Land and buildings and equipment Total ($ in millions) 2024 2023 2022 2024 2023 2022 2024 2023 2022 Operating leases: Cash paid under operating cash flows 228 220 200 88 73 66 316 293 266 Right-of-use assets obtained in exchange for new liabilities 187 198 285 129 92 50 316 290 335 In 2024, 2023 and 2022 the cash flow amounts under finance leases were not significant. At December 31, 2024, the future net minimum lease payments for operating and finance leases and the related present value of the net minimum lease payments consisted of the following: Operating leases Finance leases Land and Machinery Land and Machinery ($ in millions) buildings and equipment buildings and equipment 2025 193 85 18 22 2026 160 61 18 12 2027 118 35 18 11 2028 91 11 18 7 2029 70 2 9 3 Thereafter 136 — 88 7 Total minimum lease payments 768 194 169 62 Difference between undiscounted cash flows and discounted cash flows (81) (15) (32) (5) Present value of minimum lease payments 687 179 137 57 94 FINANCIAL REPORT 2024 The following table presents certain information related to lease terms and discount rates: Land and buildings Machinery and equipment 2024 2023 2022 2024 2023 2022 Operating leases: Weighted-average remaining term (months) 70 71 73 33 35 31 Weighted-average discount rate (in %) 3.9% 3.7% 3.3% 5.4% 4.3% 1.9% Finance leases: Weighted-average remaining term (months) 202 128 135 39 36 33 Weighted-average discount rate (in %) 4.6% 4.9% 5.5% 4.7% 3.7% 2.3% The present value of minimum finance lease payments included in Short ‑ term debt and current maturities of long ‑ term debt and Long ‑ term debt in the Consolidated Balance Sheets at December 31, 2024, amounts to $28 million and $166 million, respectively, and at December 31, 2023, amounts to $31 million and $161 million, respectively. — Note 17 Income taxes Income tax expense consisted of the following: ($ in millions) 2024 2023 2022 Current taxes 1,277 955 1,101 Deferred taxes 1 (25) (344) Income tax expense allocated to continuing operations 1,278 930 757 Income tax benefit allocated to discontinued operations (4) (6) (5) Income tax expense from continuing operations is reconciled below from the Company’s weighted ‑ average global tax rate (rather than from the Swiss domestic statutory tax rate) as the parent company of the ABB Group, ABB Ltd, is domiciled in Switzerland and income generated in jurisdictions outside of Switzerland (hereafter “foreign jurisdictions”) which has already been subject to corporate income tax in those foreign jurisdictions is, to a large extent, tax exempt in Switzerland. There is no requirement in Switzerland for any parent company of a group to file a tax return of the consolidated group determining domestic and foreign pre ‑ tax income. As the Company’s consolidated income from continuing operations is predominantly earned outside of Switzerland, the weighted ‑ average global tax rate of the Company results from enacted corporate income tax rates in foreign jurisdictions. FINANCIAL REPORT 2024 95 The reconciliation of Income tax expense from continuing operations at the weighted ‑ average tax rate to the effective tax rate is as follows: ($ in millions, except % data) 2024 2023 2022 Income from continuing operations before income taxes 5,233 4,778 3,394 Weighted-average global tax rate 23.7% 22.3% 23.6% Income taxes at weighted-average tax rate 1,240 1,065 800 Items taxed at rates other than the weighted-average tax rate 110 33 127 Unrecognized tax benefits (182) (207) (83) Changes in valuation allowance, net 56 9 (195) Effects of changes in tax laws and enacted tax rates — (3) (19) Non-deductible / non-taxable items 33 43 97 Other, net 21 (10) 30 Income tax expense from continuing operations 1,278 930 757 Effective tax rate for the year 24.4% 19.5% 22.3% The allocation of consolidated income from continuing operations, which is predominantly earned outside of Switzerland, impacts the “Weighted-average global tax rate”. In 2024, 2023 and 2022, “Items taxed at rates other than the weighted-average tax rate” included $17 million, $30 million and $53 million, respectively, for dividends received in holding entities which could not fully benefit from the participation exemption as well as the impact of recording expected taxes on undistributed earnings of foreign subsidiaries. The amount in 2024 also includes an insigificant amount relating to the impact of the minimum tax effects from the OECD Pillar Two framework. In 2024, “Changes in valuation allowance, net” included $79 million of negative impacts from certain unfavorable business developments in Europe and $8 million of negative impacts from changes in certain outlooks, partially offset by positive impacts from operations of remaining businesses. In 2023, this amount included $57 million of negative impacts from negative business performance in Europe, partially offset with positive impacts from changes in certain outlooks related to certain business performance in the Americas of $13 million and Europe of $22 million. In 2022, this amount included positive impacts from changes in certain outlooks in Asia of $22 million, Europe of $23 million and the Americas of $208 million, offset by negative impacts from other changes in certain outlooks in Europe of $55 million. In 2024 and 2023, “Effects of changes in tax laws and enacted tax rates” were not significant while in 2022, this amount primarily reflects the impact of changes in certain tax rates in Europe for $25 million. In 2024, there were no significant items impacting “Non-deductible / non-taxable items”. In 2023, this amount also reflects an additional tax impact of $24 million related to the sale of the former Power Conversion Division. In 2022, this amount includes a net tax impact of $65 million for the non-deductible regulatory penalties in connection with the Kusile project offset partially by the impact of the non-taxable gain from the sale of the remaining investment in Hitachi Energy. In all periods, the amounts reported also include other items that were deducted for financial accounting purposes but are typically not tax deductible, such as certain interest expense costs, local taxes on productive activities, disallowed amounts for meals and entertainment expenses and other similar items. In 2024, “Unrecognized tax benefits” included a combined benefit of $92 million related to positive reassessments of certain tax risks in Europe and Africa and, in addition, closed tax audits of $78 million in Europe. In 2023, this amount included a benefit of $206 million related to a favorable resolution of an uncertain tax matter in Asia relating to the divestment in 2020 of the Power Grids business. In 2022, this amount included a net benefit of $95 million related to the interpretation of tax law and double tax treaty agreements by competent tax authorities. 96 FINANCIAL REPORT 2024 Deferred tax assets and liabilities consisted of the following: December 31, ($ in millions) 2024 2023 Deferred tax assets: Unused tax losses and credits 582 544 Provisions and other accrued liabilities 826 839 Other current assets including receivables 69 76 Pension 243 284 Inventories 364 347 Intangible assets 1,032 1,121 Other 56 69 Total gross deferred tax asset 3,172 3,280 Valuation allowance (1,080) (1,070) Total gross deferred tax asset, net of valuation allowance 2,092 2,210 Deferred tax liabilities: Property, plant and equipment (239) (243) Intangible assets (203) (241) Other assets (155) (142) Pension (281) (317) Other liabilities (103) (154) Inventories (70) (66) Unremitted earnings of subsidiaries (375) (335) Total gross deferred tax liability (1,426) (1,498) Net deferred tax asset (liability ) 666 712 Included in: “Deferred taxes”—non-current assets 1,341 1,381 “Deferred taxes”—non-current liabilities (675) (669) Net deferred tax asset (liability) 666 712 Certain entities have deferred tax assets related to net operating loss carryforwards and other items. As recognition of these assets in certain entities did not meet the more likely than not criterion, valuation allowances have been recorded. “Unused tax losses and credits” at December 31, 2024 and 2023, in the table above, included $44 million and $54 million, respectively, for which the Company has established a valuation allowance as, due to limitations imposed by the relevant tax law, the Company determined that, more likely than not, such deferred tax assets would not be realized. The valuation allowance at December 31, 2024, 2023 and 2022, was $1,080 million, $1,070 million and $1,000 million, respectively. Certain amounts included in deferred tax assets for intangible assets result from intercompany transactions occurring at fair market value for which no corresponding accounting basis exists. At December 31, 2024 and 2023, deferred tax liabilities totaling $375 million and $335 million, respectively, have been provided for withholding taxes, dividend distribution taxes or additional corporate income taxes (hereafter “withholding taxes”) on unremitted earnings which will be payable in foreign jurisdictions in the event of repatriation of the foreign earnings to Switzerland. Income which has been generated outside of Switzerland and has already been subject to corporate income tax in such foreign jurisdictions is, to a large extent, tax exempt in Switzerland and therefore, generally no or only limited Swiss income tax has to be provided for on the repatriated earnings of foreign subsidiaries. FINANCIAL REPORT 2024 97 Certain countries levy withholding taxes on dividend distributions and these taxes cannot always be fully reclaimed by the Company’s relevant subsidiary receiving the dividend, although the taxes have to be withheld and paid by the relevant subsidiary distributing such dividend. In 2024 and 2023, certain taxes arose in certain foreign jurisdictions for which the technical merits do not allow utilization of benefits. At December 31, 2024 and 2023, foreign subsidiary retained earnings which would be subject to withholding taxes upon distribution were approximately $50 million and $50 million, respectively. These earnings were considered as indefinitely reinvested, as these funds are used for financing current operations as well as business growth through working capital and capital expenditure in those countries and, consequently, no deferred tax liability was recorded. At December 31, 2024, net operating loss carryforwards of $2,306 million and tax credits of $39 million were available to reduce future income taxes of certain subsidiaries. Of these amounts, $788 million of operating loss carryforwards and $38 million of tax credits will expire in varying amounts through 2042, while the remainder are available for carryforward indefinitely. The largest amount of these carryforwards are related to the Company’s Europe operations. Unrecognized tax benefits consisted of the following: Penalties and interest related to Unrecognized unrecognized ($ in millions) tax benefits tax benefits Total Classification as unrecognized tax items on January 1, 2022 1,322 199 1,521 Increase relating to prior year tax positions 26 36 62 Decrease relating to prior year tax positions (126) (24) (150) Increase relating to current year tax positions 80 4 84 Decrease due to settlements with tax authorities (3) (2) (5) Decrease as a result of the applicable statute of limitations (71) (23) (94) Exchange rate differences (58) (10) (68) Balance at December 31, 2022, which would, if recognized, affect the effective tax rate 1,170 180 1,350 Net change due to acquisitions and divestments (9) (1) (10) Increase relating to prior year tax positions 32 44 76 Decrease relating to prior year tax positions (294) (20) (314) Increase relating to current year tax positions 131 7 138 Decrease due to settlements with tax authorities (21) 1 (20) Decrease as a result of the applicable statute of limitations (80) (19) (99) Exchange rate differences 14 3 17 Balance at December 31, 2023, which would, if recognized, affect the effective tax rate 943 195 1,138 Increase relating to prior year tax positions 21 47 68 Decrease relating to prior year tax positions (225) (59) (284) Increase relating to current year tax positions 87 4 91 Decrease due to settlements with tax authorities (10) (4) (14) Decrease as a result of the applicable statute of limitations (59) (15) (74) Exchange rate differences (46) (12) (58) Balance at December 31, 2024, which would, if recognized, affect the effective tax rate 711 156 867 In 2024, 2023 and 2022, “Increase relating to current year tax positions” included a total of $59 million, $76 million and $69 million, respectively, in taxes related to the interpretation of tax law and double tax treaty agreements by competent tax authorities. In 2024, “Increase relating to prior year tax positions” included $8 million, predominantly from Europe. In 2023, “Increase relating to prior year tax positions” included $14 million predominantly from Africa. 98 FINANCIAL REPORT 2024 In 2022, “Increase relating to prior year tax positions” included a total of $26 million predominantly from Asia and Europe. In 2024, “Decrease relating to prior year tax positions” included $92 million for a decrease related to reassessments of tax risks in Europe and Africa and $78 million related to closed tax audits in Europe. In 2023, “Decrease relating to prior year tax positions” included $206 million for a decrease in tax risk in Asia related to the divestment in 2020 of the Power Grids business, $40 million due to audit settlements in Europe and the remainder is primarily due to changed tax risk assessments. In 2022, “Decrease relating to prior year tax positions” included $94 million related to tax risk assessments in Europe and settlements of $26 million in Asia and Europe. In 2024, “Decrease due to settlements with tax authorities” included $7 million in Europe related to closed tax audits. In 2023, “Decrease due to settlements with tax authorities” of $21 million related to tax risk assessments in Europe. In 2022, “Decrease due to settlements with tax authorities” is predominantly related to tax assessments received in Asia and Europe. At December 31, 2024, the Company expects the resolution, within the next twelve months, of unrecognized tax benefits related to pending court cases amounting to $20 million for income taxes, penalties and interest. Otherwise, the Company had not identified any other significant changes which were considered reasonably possible to occur within the next twelve months. At December 31, 2024, the earliest significant open tax years that remained subject to examination were the following: Region Year Europe 2018 United States 2021 Rest of Americas 2020 China 2015 Rest of Asia, Middle East and Africa 2020 — Note 18 Employee benefits The Company operates defined benefit pension plans, defined contribution pension plans, and termination indemnity plans, in accordance with local regulations and practices. At December 31, 2024, the Company’s most significant defined benefit pension plans are in Switzerland as well as in Germany, the United Kingdom, and the United States. These plans cover a large portion of the Company’s employees and provide benefits to employees in the event of death, disability, retirement, or termination of employment. Certain of these plans are multi ‑ employer plans. The Company also operates other postretirement benefit plans including postretirement health care benefits and other employee ‑ related benefits for active employees including long ‑ service award plans. The postretirement benefit plans are not significant. The measurement date used for the Company’s employee benefit plans is December 31. The funding policies of the Company’s plans are consistent with local government and tax requirements. The Company recognizes in its Consolidated Balance Sheets the funded status of its defined benefit pension plans, postretirement plans and other employee ‑ related benefits measured as the difference between the fair value of the plan assets and the benefit obligation. Unless otherwise indicated, the following tables include amounts relating to both continuing and discontinued operations. FINANCIAL REPORT 2024 99 Obligations and funded status of the plans The change in benefit obligation, change in fair value of plan assets, and funded status recognized in the Consolidated Balance Sheets were as follows: Defined pension benefits Switzerland International ($ in millions) 2024 2023 2024 2023 Benefit obligation at January 1, 2,834 2,457 3,669 3,572 Service cost 46 40 28 30 Interest cost 35 48 156 166 Contributions by plan participants 39 34 9 11 Benefit payments (132) (134) (226) (236) Settlements (32) (97) (41) (69) Actuarial (gain) loss 166 224 (188) 91 Plan amendments and other 10 1 (2) 5 Exchange rate differences (220) 261 (125) 99 Benefit obligation at December 31, 2,746 2,834 3,280 3,669 Fair value of plan assets at January 1, 3,476 3,183 3,239 3,172 Actual return on plan assets 139 147 43 178 Contributions by employer 45 18 77 89 Contributions by plan participants 39 34 9 11 Benefit payments (132) (134) (226) (236) Settlements (32) (97) (41) (69) Plan assets of businesses acquired (divested) — — — 1 Exchange rate differences (266) 325 (99) 93 Fair value of plan assets at December 31, 3,269 3,476 3,002 3,239 Funded status — overfunded (underfunded) 523 642 (278) (430) The amounts recognized in Accumulated other comprehensive loss and Noncontrolling interests were: Defined pension benefits December 31, ($ in millions) 2024 2023 2022 Net actuarial (loss) gain (1,397) (1,439) (1,183) Prior service credit 17 39 56 Amount recognized in OCI (1) and NCI (2) (1,380) (1,400) (1,127) Taxes associated with amount recognized in OCI and NCI 287 311 266 Amount recognized in OCI (1) and NCI, net of tax (3) (1,093) (1,089) (861) (1) OCI represents Accumulated other comprehensive loss and, in addition, includes $8 million, $14 million and $37 million at December 31, 2024, 2023 and 2022, recognized for Other postretirement benefits. (2) NCI represents Noncontrolling interests. (3) NCI, net of tax, amounted to $(1) million, $0 million and $(1) million at December 31, 2024, 2023 and 2022. In addition, the following amounts were recognized in the Company's Consolidated Balance Sheets: Defined pension benefits Switzerland International December 31, ($ in millions) 2024 2023 2024 2023 Overfunded plans 523 642 165 137 Underfunded plans — current — — (16) (16) Underfunded plans — non-current — — (427) (551) Funded status — overfunded (underfunded) 523 642 (278) (430) December 31, ($ in millions) 2024 2023 Non-current assets Overfunded pension plans 688 779 Other employee-related benefits 1 1 Pension and other employee benefits 689 780 100 FINANCIAL REPORT 2024 December 31, ($ in millions) 2024 2023 Current liabilities Underfunded pension plans (16) (16) Underfunded other postretirement benefit plans (2) (3) Other employee-related benefits (14) (14) Pension and other employee benefits (32) (33) December 31, ($ in millions) 2024 2023 Non-current liabilities Underfunded pension plans (427) (551) Underfunded other postretirement benefit plans (16) (18) Other employee-related benefits (126) (117) Pension and other employee benefits (569) (686) The accumulated benefit obligation (ABO) for all defined benefit pension plans was $5,963 million and $6,427 million at December 31, 2024 and 2023, respectively. The projected benefit obligation (PBO), ABO and fair value of plan assets, for pension plans with a PBO in excess of fair value of plan assets or ABO in excess of fair value of plan assets, was: PBO exceeds fair value of plan assets ABO exceeds fair value of plan assets December 31, Switzerland International Switzerland International ($ in millions) 2024 2023 2024 2023 2024 2023 2024 2023 PBO — — 2,116 2,315 — — 2,109 2,311 ABO — — 2,071 2,257 — — 2,065 2,253 Fair value of plan assets — — 1,675 1,749 — — 1,669 1,745 Components of net periodic benefit cost Net periodic benefit cost mainly consisted of the following: Defined pension benefits Switzerland International ($ in millions) 2024 2023 2022 2024 2023 2022 Operational pension cost: Service cost 46 40 50 28 30 38 Operational pension cost 46 40 50 28 30 38 Non-operational pension cost (credit): Interest cost (credit) 35 48 13 156 166 87 Expected return on plan assets (126) (129) (117) (168) (157) (153) Amortization of prior service cost (credit) (8) (8) (9) (2) (2) (2) Amortization of net actuarial loss — — — 52 52 58 Curtailments, settlements and special termination benefits 5 13 4 3 19 7 Non-operational pension cost (credit) (1) (94) (76) (109) 41 78 (3) Net periodic benefit cost (credit) (48) (36) (59) 69 108 35 (1) Total Non-operational pension cost (credit) includes additional credits of $2 million, $19 million and $4 million at December 31, 2024, 2023 and 2022, related to Other postretirement benefits. The components of net periodic benefit cost other than the service cost component are included in Non-operational pension cost (credit) in the Consolidated Income Statements. FINANCIAL REPORT 2024 101 Assumptions The following weighted-average assumptions were used to determine projected benefit obligations: Defined pension benefits Switzerland International December 31, (in %) 2024 2023 2024 2023 Discount rate 0.9 1.4 4.9 4.5 Rate of compensation increase — — 1.6 1.7 Rate of pension increase — — 1.5 1.6 Cash balance interest credit rate 2.0 2.0 3.4 3.2 For the Company’s significant benefit plans, the discount rate used at each measurement date is set based on a high-quality corporate bond yield curve (derived based on bond universe information sourced from reputable third-party index and data providers and rating agencies) reflecting the timing, amount and currency of the future expected benefit payments for the respective plan. Consistent discount rates are used across all plans in each currency zone, based on the duration of the applicable plan(s) in that zone. For plans in the other countries, the discount rate is based on high quality corporate or government bond yields applicable in the respective currency, as appropriate at each measurement date with a duration broadly consistent with the respective plan’s obligations. The following weighted-average assumptions were used to determine the “Net periodic benefit cost”: Defined pension benefits Switzerland International (in %) 2024 2023 2022 2024 2023 2022 Discount rate 1.4 2.0 0.7 4.5 4.8 2.1 Expected long-term rate of return on plan assets 3.9 4.0 3.3 5.4 5.0 3.7 Rate of compensation increase — — — 1.7 1.8 1.5 Cash balance interest credit rate 2.0 2.0 1.3 3.2 2.7 2.1 The “Expected long-term rate of return on plan assets” is derived for each benefit plan by considering the expected future long-term return assumption for each individual asset class. A single long-term return assumption is then derived for each plan based upon the plan’s target asset allocation. Plan assets The Company has pension plans in various countries with the majority of the Company’s pension liabilities deriving from a limited number of these countries. The pension plans are typically funded by regular contributions from employees and the Company. These plans are typically administered by boards of trustees (which include Company representatives) whose primary responsibilities include ensuring that the plans meet their liabilities through contributions and investment returns. The boards of trustees have the responsibility for making key investment strategy decisions within a risk-controlled framework. The pension plan assets are invested in diversified portfolios that are managed by third-party asset managers, in accordance with local statutory regulations, pension plan rules and the respective plans’ investment guidelines, as approved by the boards of trustees. Plan assets are generally segregated from those of the Company and invested with the aim of meeting the respective plans’ projected future pension liabilities. Plan assets are measured at fair value at the balance sheet date. The boards of trustees manage the assets of the pension plans in a risk-controlled manner and assess the risks embedded in the pension plans through asset/liability management studies. Asset/liability management studies typically take place every three years. However, the risks of the plans are monitored on an ongoing basis. 102 FINANCIAL REPORT 2024 The boards of trustees’ investment goal is to maximize the long-term returns of plan assets within specified risk parameters, while considering the future liabilities and liquidity needs of the individual plans. Risk measures taken into account include the funding ratio of the plan, the likelihood of extraordinary cash contributions being required, the risk embedded in each individual asset class, and the plan asset portfolio as a whole. The Company’s global pension asset allocation is the result of the asset allocations of the individual plans, which are set by the respective boards of trustees. The target asset allocation of the Company’s plans on a weighted-average basis is as follows: Target (in %) Switzerland International Asset class Equity 16 17 Fixed income 52 67 Real estate 25 2 Other 7 14 Total 100 100 The actual asset allocations of the plans are in line with the target asset allocations. Equity securities primarily include investments in large-cap and mid-cap publicly traded companies. Fixed income assets primarily include corporate bonds of companies from diverse industries and government bonds. Both fixed income and equity assets are invested either via funds or directly in segregated investment mandates, and include an allocation to emerging markets. Real estate consists primarily of investments in real estate in Switzerland held in the Swiss plans. The “Other” asset class includes investments in private equity, insurance contracts, cash, and reflects a variety of investment strategies. Based on the global asset allocation and the fair values of the plan assets, the expected long-term return on assets at December 31, 2024, is 4.4 percent. The Company and the local boards of trustees regularly review the investment performance of the asset classes and individual asset managers. Due to the diversified nature of the investments, the Company is of the opinion that no significant concentration of risks exists in its pension fund assets. At December 31, 2024 and 2023, plan assets include ABB Ltd’s shares (as well as an insignificant amount of the Company’s debt instruments) with a total value of $9 million and $9 million, respectively. The fair values of the Company’s pension plan assets by asset class are presented below. For further information on the fair value hierarchy and an overview of the Company’s valuation techniques applied, see the “Fair value measures” section of Note 2. Not subject to Total December 31, 2024 ($ in millions) Level 1 Level 2 Level 3 leveling (1) fair value Asset class Equity Equity securities 198 198 Mutual funds/commingled funds 636 636 Emerging market mutual funds/commingled funds 107 107 Fixed income Government and corporate securities 178 730 908 Government and corporate—mutual funds/commingled funds 2,390 2,390 Emerging market bonds—mutual funds/commingled funds 343 343 Real estate 981 981 Insurance contracts 184 184 Cash and short-term investments 157 72 229 Private equity 44 251 295 Total 533 4,278 228 1,232 6,271 FINANCIAL REPORT 2024 103 Not subject to Total December 31, 2023 ($ in millions) Level 1 Level 2 Level 3 leveling (1) fair value Asset class Equity Equity securities 64 64 Mutual funds/commingled funds 751 751 Emerging market mutual funds/commingled funds 76 76 Fixed income Government and corporate securities 160 953 1,113 Government and corporate—mutual funds/commingled funds 2,410 2,410 Emerging market bonds—mutual funds/commingled funds 367 367 Real estate 1,225 1,225 Insurance contracts 215 215 Cash and short-term investments 99 85 184 Private equity 60 250 310 Total 323 4,642 275 1,475 6,715 (1) Amounts relate to assets measured using the NAV practical expedient which are not subject to leveling. The Company applies accounting guidance related to the presentation of certain investments using the net asset value (NAV) practical expedient. This accounting guidance exempts investments using this practical expedient from categorization within the fair value hierarchy. Investments measured at NAV are primarily non exchange-traded commingled or collective funds in private equity and real estate where the fair value of the underlying assets is determined by the investment manager. Investments in private equity can never be redeemed, but instead the funds will make distributions through liquidation of the underlying assets. Total unfunded commitments for the private equity funds were approximately $122 million and $108 million at December 31, 2024 and 2023, respectively. The real estate funds typically offer a redemption notice of three to twelve months. Contributions Employer contributions were as follows: Defined pension benefits Switzerland International ($ in millions) 2024 2023 2024 2023 Total contributions to defined benefit pension plans 45 18 77 89 The Company expects to contribute approximately $85 million to its defined benefit pension plans in 2025. Of these contributions, $4 million are expected to be non-cash contributions. The Company also contributes to a number of defined contribution plans. The aggregate expense for these plans in continuing operations was $317 million, $293 million and $269 million in 2024, 2023 and 2022, respectively. Contributions to multi-employer plans were not significant in 2024, 2023 and 2022. Estimated future benefit payments The expected future cash flows to be paid by the Company’s plans in respect of pension at December 31, 2024, are as follows: Defined pension benefits ($ in millions) Switzerland International 2025 226 247 2026 202 256 2027 198 254 2028 192 253 2029 186 254 Years 2030 - 2034 852 1,208 104 FINANCIAL REPORT 2024 — Note 19 Share-based payment arrangements The Company has granted share-based instruments to its employees under three principal share ‑ based payment plans, as more fully described in the respective sections below. Compensation cost for equity ‑ settled awards is recorded in Total cost of sales and in Selling, general and administrative expenses and totaled $102 million, $103 million and $42 million in 2024, 2023 and 2022, respectively, while compensation cost for cash ‑ settled awards, recorded in Selling, general and administrative expenses, was not significant. The total tax benefit recognized in 2024, 2023 and 2022 was not significant. At December 31, 2024, the Company had the ability to issue up to 94 million new shares out of contingent capital in connection with share ‑ based payment arrangements. In addition, 7 million of the 22 million shares held by the Company as treasury stock at December 31, 2024, could be used to settle share ‑ based payment arrangements. As the primary trading market for the shares of ABB Ltd is the SIX Swiss Exchange (on which the shares are traded in Swiss francs) and substantially all the share ‑ based payment arrangements with employees are based on the Swiss franc share or have strike prices set in Swiss francs, certain data disclosed below related to the instruments granted under share ‑ based payment arrangements are presented in Swiss francs. Employee Share Acquisition Plan The employee share acquisition plan (ESAP) is a stock ‑ option plan with a savings feature that is made widely available to Company employees. Employees save over a twelve ‑ month period, by way of regular payroll deductions. At the end of the savings period, employees choose whether to exercise their stock options using their savings plus interest, if any, to buy ABB Ltd shares at the exercise price set at the grant date, or have their savings returned with any interest. The savings are accumulated in bank accounts held by a third ‑ party trustee on behalf of the participants and earn interest, where applicable. Employees can withdraw from the ESAP at any time during the savings period and will be entitled to a refund of their accumulated savings. The fair value of each option is estimated on the date of grant using a lattice model, using the assumptions noted in the table below. The expected term of the option granted has been determined to be the contractual one ‑ year life of each option, at the end of which the options vest and the participants are required to decide whether to exercise their options or have their savings returned with interest. The risk ‑ free rate is based on one ‑ year Swiss franc interest rates, reflecting the one ‑ year contractual life of the options. In estimating forfeitures, the Company has used the data from previous ESAP launches. 2024 2023 2022 Expected volatility 22% 21% 25% Dividend yield 1.8% 2.8% 3.0% Expected term 1 year 1 year 1 year Risk-free interest rate 0.4% 1.6% 1.1% FINANCIAL REPORT 2024 105 Presented below is a summary of activity under the ESAP: Weighted- Weighted- Aggregate average average intrinsic exercise remaining value Number of price contractual (in millions shares (in Swiss term of Swiss (in millions) francs) (in years) francs) (1) Outstanding at January 1, 2024 1.8 30.49 Granted 1.5 48.41 Forfeited (0.1) 31.07 Exercised (2) (1.5) 30.49 Not exercised (savings returned plus interest) (0.2) 30.49 Outstanding at December 31, 2024 1.5 48.41 0.8 1 Vested and expected to vest at December 31, 2024 1.4 48.41 0.8 1 Exercisable at December 31, 2024 — — — — (1) Computed using the closing price, in Swiss francs, of ABB Ltd shares on the SIX Swiss Exchange and the exercise price of each option in Swiss francs. (2) The cash received in 2024 from exercises was approximately $51 million. The shares were delivered out of treasury stock. The exercise prices per ABB Ltd share of 48.41 Swiss francs and 30.49 Swiss francs for the 2024 grant and the 2023 grant, respectively, were determined using the closing price of the ABB Ltd share on the SIX Swiss Exchange on the respective grant dates. The exercise prices per ABB Ltd share and per ADS of 27.99 Swiss francs and $28.09, respectively, for the 2022 grant were determined using the closing price of the ABB Ltd share on the SIX Swiss Exchange and ADS on the New York Stock Exchange on the grant date. At December 31, 2024, the total unrecognized compensation cost related to non ‑ vested options granted under the ESAP was not significant. The weighted ‑ average grant ‑ date fair value (per option) of options granted during 2024, 2023 and 2022 was 3.86 Swiss francs, 2.28 Swiss francs and 2.47 Swiss francs, respectively. The total intrinsic value (on the date of exercise) of options exercised in 2024 was $31 million, while for 2023 and 2022 it was not significant. Long-Term Incentive Plan The long ‑ term incentive plan (LTIP) involves annual grants of the Company’s stock subject to certain conditions (Performance Shares) to members of the Company’s Executive Committee and selected other senior executives, as defined in the terms of the LTIP. The ultimate amount delivered under the LTIP’s Performance Shares grant is based on achieving certain results against targets, as set out below, over a three-year period from grant and the final amount is delivered to the participants at the end of this period. Generally, for awards to vest, the participant has to fulfill a three-year service condition as defined in the terms and conditions of the LTIP. The Performance Shares under the 2024, 2023 and 2022 LTIP launches include a component based on the Company’s earnings per share performance (weighted 50 percent), a component based on the Company’s relative total shareholder return (weighted 30 percent) and a sustainability component based on the Company’s CO 2 equivalent emissions reductions (weighted 20 percent). For the earnings per share performance component of the Performance Shares, the actual number of shares that will be delivered at a future date is based on the Company’s average earnings per share over three financial years, beginning with the year of launch. The actual number of shares that will ultimately be delivered will vary depending on the earnings per share outcome as computed under each LTIP launch, interpolated between a lower threshold (no shares delivered) and an upper threshold (the number of shares delivered is capped at 200 percent of the conditional grant). 106 FINANCIAL REPORT 2024 For the relative total shareholder return component of the Performance Shares, the actual number of shares that will be delivered at a future date is based on the Company’s total shareholder return performance relative to a peer group of companies over a three-year period starting with the year of grant. The actual number of shares that will ultimately be delivered will vary depending on the relative total shareholder return outcome achieved between a lower threshold (no shares delivered) and an upper threshold (the number of shares delivered is capped at 200 percent of the conditional grant). For the sustainability component of the Performance Shares, the actual number of shares that will be delivered at a future date is based on the Company’s scope 1 and 2 CO 2 equivalent emissions reduction over three financial years, beginning with the year of launch, compared to 2019 baseline emissions. The actual number of shares that will ultimately be delivered will vary depending on the sustainability outcome as computed under the LTIP launch, interpolated between a lower threshold (no shares delivered) and an upper threshold (the number of shares delivered is capped at 200 percent of the conditional grant). Certain other key employees not included in the employee group granted the Performance Shares described above, were granted Restricted Shares of the Company under the LTIP. The Restricted Shares do not have performance conditions and vest over a three-year period from the grant date. Under the 2024, 2023 and 2022 LTIP launches, participants generally do not have the ability to receive any of the award in cash, subject to legal restrictions in certain jurisdictions. Presented below is a summary of activity under the Performance Shares of the LTIP: Weighted-average Number of grant-date Performance Shares fair value per share (in millions) (Swiss francs) Nonvested at January 1, 2024 1.6 33.60 Granted 0.6 36.15 Vested (0.8) 36.64 Forfeited (0.1) 31.03 Nonvested at December 31, 2024 1.4 33.06 The aggregate fair value, at the dates of grant, of Performance Shares granted in 2024, 2023 and 2022 was $23 million, $24 million and $26 million, respectively. The total grant-date fair value of shares that vested during 2024 and 2023 was $31 million and $17 million, respectively, while in 2022 it was not significant. The weighted-average grant-date fair value (per share) of shares granted during 2024, 2023 and 2022 was 36.15 Swiss francs, 29.18 Swiss francs and 33.33 Swiss francs, respectively. The total fair value of Performance Shares delivered in 2024 and 2023 (including shares vested in prior years and delivered in the year) was approximately $77 million and $80 million, respectively, while in 2022 it was not significant. Presented below is a summary of activity under the Restricted Shares of the LTIP: Weighted-average Number of grant-date Restricted Shares fair value per share (in millions) (Swiss francs) Nonvested at January 1, 2024 2.3 29.51 Granted 0.7 41.65 Vested (0.8) 26.64 Forfeited (0.1) 32.65 Nonvested at December 31, 2024 2.1 34.55 The aggregate fair value, at the dates of grant, of Restricted Shares granted in 2024, 2023 and 2022 was $34 million, $30 million and $27 million, respectively. The total grant-date fair value of shares that vested during 2024 and 2023 was $22 million and $20 million, respectively, while in 2022 it was not significant. The weighted-average grant-date fair value (per share) of shares granted during 2024, 2023 and 2022 was 41.65 Swiss francs, 31.38 Swiss francs and 30.52 Swiss francs, respectively. The total fair value of Restricted Shares delivered in 2024 and 2023 was approximately $40 million and $35 million, respectively, while in 2022 it was not significant. FINANCIAL REPORT 2024 107 Equity-settled awards are recorded in the Additional paid-in capital component of Stockholders’ equity, with compensation cost recorded in Selling, general and administrative expenses over the vesting period (which is from grant date to the end of the vesting period) based on the grant-date fair value of the shares. Cash-settled awards are recorded as a liability, remeasured at fair value at each reporting date for the percentage vested, with changes in the liability recorded in Selling, general and administrative expenses. At December 31, 2024, total unrecognized compensation cost related to equity-settled awards under the LTIP was $71 million and is expected to be recognized over a weighted-average period of 1.8 years. The compensation cost recorded in 2024, 2023 and 2022 for cash-settled awards was not significant. For the earnings per share component of the LTIP launches, the fair value of granted shares is based on the market price of the ABB Ltd share at grant date for equity-settled awards and at each reporting date for cash-settled awards, as well as the probable outcome of the earnings per share achievement, as computed using a Monte Carlo simulation model. The main inputs to this model are the Company’s and external financial analysts’ revenue growth rates and Operational EBITA margin expectations. For the relative total shareholder return component of the LTIP launches, the fair value of granted shares at grant date, for equity-settled awards, and at each reporting date, for cash-settled awards, is determined using a Monte Carlo simulation model. The main inputs to this model are the Company’s share price and dividend yield, the volatility of the Company’s and the peer group’s share price as well as the correlation between the peer companies. For the sustainability component of the LTIP launches, the fair value of granted shares is based on the market price of the ABB Ltd share at grant date for equity-settled awards and at each reporting date for cash-settled awards, as well as the probable outcome of the sustainability component achievement, as determined by internal modelling based on the Company’s CO 2 equivalent emissions. Management Incentive Plan Up to 2019, the Company offered, under the Management Incentive Plan (MIP), options and cash ‑ settled warrant appreciation rights (WARs) to key employees for no consideration. The options and WARs expire six years from the date of grant. Participants may exercise or sell options and exercise WARs after the vesting period, which is three years from the date of grant. No grants were made in 2024, 2023 and 2022 under the MIP. The options granted under the MIP allow participants to purchase shares of ABB Ltd at predetermined prices. Participants may sell the options rather than exercise the right to purchase shares. Equivalent warrants are listed by a third ‑ party bank on the SIX Swiss Exchange, which facilitates pricing and transferability of options granted under this plan. The options entitle the holder to request that the third ‑ party bank purchase such options at the market price of equivalent listed warrants related to that MIP launch. If the participant elects to sell the options, the options will thereafter be held by a third party and, consequently, the Company’s obligation to deliver shares will be toward this third party. The fair value of each option was estimated on the date of grant using a lattice model. In 2024, 71 million options (with a conversion ratio of 5:1) were exercised, representing 14 million shares, with the shares delivered out of treasury stock. Cash received upon exercise amounted to approximately $340 million. In 2024, 2023 and 2022, the aggregate intrinsic value (on the date of exercise) of options exercised was approximately $341 million, $64 million and $143 million, respectively. At December 31, 2024, all options granted under the MIP were vested and exercisable. The aggregate intrinsic value at December 31, 2024, of options outstanding was $38 million. At December 31, 2024, there were 6 million options (with an exercise price of 17.63 Swiss francs) outstanding, representing approximately 1 million shares, with a remaining contractual term of 0.7 years. Each WAR gives the participant the right to receive, in cash, the market price of an equivalent listed warrant on the date of exercise of the WAR. At December 31, 2024 and 2023, the number of WARs outstanding and their aggregate fair value was not significant. 108 FINANCIAL REPORT 2024 Other share-based payments The Company has other minor share-based payment arrangements with certain employees. The compensation cost related to these arrangements in 2024, 2023 and 2022 was not significant. — Note 20 Stockholders' equity Capital ABB Ltd is a corporation organized under the laws of Switzerland and the rights of its shareholders are governed by Swiss law and its Articles of Incorporation. At December 31, 2024 and 2023, the Company had 1,861 million shares and 1,882 million shares, respectively, that were registered and issued. In line with the revised provisions of Swiss corporate law effective January 1, 2023, shareholders approved, at ABB’s Annual General Meeting of Shareholders (AGM) in March 2023, the introduction of a capital band ranging from 90 percent to 110 percent of the issued share capital entered in the commercial register at that time. Within this capital band, the Board of Directors is authorized to increase or reduce the share capital once or several times until March 23, 2028, or until an earlier expiry of the capital band. The Company also has contingent share capital, as specified in the ABB Ltd Articles of Incorporation, which forms a component of total authorized shares. At December 31, 2024 and 2023, the Company had a total of 2,361 million and 2,383 million authorized shares, respectively. Dividends At the AGM in March 2024, the shareholders approved the proposal of the Board of Directors to distribute a total of 0.87 Swiss francs per share. The approved dividend distribution amounted to $1,804 million, with the Company disbursing a portion in March 2024 and the remaining amounts in April 2024. At the AGM in March 2023, the shareholders approved the proposal of the Board of Directors to distribute a total of 0.84 Swiss francs per share. The approved dividend distribution amounted to $1,706 million, with the Company disbursing a portion in March 2023 and the remaining amounts in April 2023. At the AGM in March 2022, the shareholders approved the proposal of the Board of Directors to distribute a total of 0.82 Swiss francs per share. The approved dividend distribution amounted to $1,700 million, with the Company disbursing a portion in March 2022 and the remaining amounts in April 2022. Amounts available to be distributed as dividends to the stockholders of ABB Ltd are based on the requirements of Swiss law and ABB Ltd’s Articles of Incorporation, and are determined based on amounts presented in the unconsolidated financial statements of ABB Ltd, prepared in accordance with Swiss law. At December 31, 2024, the total unconsolidated stockholders’ equity of ABB Ltd was 4,473 million Swiss francs ($4,942 million), including 223 million Swiss francs ($247 million) representing share capital, 5,234 million Swiss francs ($5,783 million) representing reserves and 984 million Swiss francs ($1,088 million) representing a reduction of equity for treasury shares. Of these amounts, 984 million Swiss francs ($1,088 million) relating to treasury shares and 45 million Swiss francs ($49 million) representing 20 percent of share capital, at December 31, 2024, are restricted by law and not available for distribution. Treasury stock transactions In March 2022, the Company announced a share buyback program of up to $3 billion. This program, which was launched in April 2022, was executed on a second trading line on the SIX Swiss Exchange and was completed in March 2023. In March 2023, the Company announced a share buyback program of up to $1 billion. This program, which was launched in April 2023, was executed on a second trading line on the SIX Swiss Exchange and was completed in March 2024. In March 2024, the Company announced a share buyback program of up to $1 billion. This program, which was launched in April 2024, was executed on a second trading line on the SIX Swiss Exchange and was completed in January 2025. FINANCIAL REPORT 2024 109 Under these buyback programs, in 2024, 2023 and 2022, the Company purchased 19 million, 25 million and 91 million, respectively, of its own shares, resulting in an increase in Treasury stock of $1,007 million, $893 million and $2,842 million, respectively. At the March 2022 AGM, shareholders approved the cancellation of 88 million shares which had been purchased under the share buyback programs. The cancellation was completed in the second quarter of 2022, resulting in a decrease in Treasury stock of $2,876 million and a corresponding total decrease in Capital stock, Additional paid-in capital and Retained earnings. In the second quarter of 2023, the Company cancelled 83 million shares which had been purchased under its share buyback programs. This resulted in a decrease in Treasury stock of $2,567 million and a corresponding total decrease in Capital stock, Additional paid-in capital and Retained earnings. In the second quarter of 2024, the Company cancelled 21 million shares which had been purchased under its share buyback programs. This resulted in a decrease in Treasury stock of $832 million and a corresponding total decrease in Capital stock, Additional paid-in capital and Retained earnings. In addition to the share buyback programs, in 2024, 2023 and 2022, the Company purchased a total of 5 million, 9 million and 20 million, respectively, of its own shares on the open market, mainly for use in connection with its employee share plans, resulting in an increase in Treasury stock of $244 million, $354 million and $660 million, respectively. Obligations to issue shares relating to employee incentive programs At December 31, 2024, the Company had outstanding obligations to deliver: • approximately 1 million shares relating to the options granted under the 2019 launch of the MIP, with a strike price of 17.63 Swiss francs, vested in August 2022 and expiring in August 2025, • up to 2 million shares relating to the ESAP, vesting and expiring in October 2025, • up to 6 million shares to Eligible Participants under the 2024, 2023 and 2022 launches of the LTIP, vesting and expiring in April 2027, April 2026 and April 2025, respectively, and • less than 1 million shares in connection with certain other share-based payment arrangements with employees. See Note 19 for a description of the above share ‑ based payment arrangements. In 2024, 2023 and 2022, the Company delivered 17 million, 6 million and 16 million shares, respectively, out of treasury stock, for options exercised in relation to the MIP. In addition, in 2024 and 2023, the Company delivered 1.5 million and 1.3 million shares, respectively, out of treasury stock for options exercised in relation to the ESAP. The number of shares delivered in 2022 under the ESAP was not significant. Issuance of subsidiary shares In November 2022, the Company received gross proceeds of 203 million Swiss francs ($216 million) through a private placement of shares in its ABB E-Mobility subsidiary, ABB E-mobility Holding Ltd (ABB E-Mobility), reducing the Company's beneficial ownership in the subsidiary from 100 percent to 92 percent. This resulted in an increase in Additional paid-in capital of $120 million. In February 2023, the Company obtained an additional amount of funding raised through the private placement of new shares of ABB E-Mobility, increasing the total gross proceeds by an additional 325 million Swiss francs (approximately $351 million) and further reducing the Company’s ownership in ABB E-Mobility to 81 percent. This resulted in an increase in Additional paid-in capital of $170 million. In December 2023, an agreement was reached to increase the ownership percentage of the investors participating in these private placements to 25 percent for no additional consideration. Declaration of dividends for the year 2024 In January 2025, the Company announced that a proposal will be put to the 2025 AGM for approval by the shareholders to distribute 0.90 Swiss francs per share to shareholders. 110 FINANCIAL REPORT 2024 — Note 21 Earnings per share Basic earnings per share is calculated by dividing income by the weighted ‑ average number of shares outstanding during the year. Diluted earnings per share is calculated by dividing income by the weighted ‑ average number of shares outstanding during the year, assuming that all potentially dilutive securities were exercised, if dilutive. Potentially dilutive securities comprise outstanding written call options and outstanding options and shares granted subject to certain conditions under the Company’s share ‑ based payment arrangements. In both 2024 and 2022, outstanding securities representing a maximum of 2 million shares were excluded from the calculation of diluted earnings per share as their inclusion would have been antidilutive. None were excluded in 2023. Basic earnings per share: ($ in millions, except per share data in $) 2024 2023 2022 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 3,937 3,769 2,517 Loss from discontinued operations, net of tax (2) (24) (42) Net income 3,935 3,745 2,475 Weighted-average number of shares outstanding (in millions) 1,844 1,855 1,899 Basic earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.14 2.03 1.33 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.02 1.30 Diluted earnings per share: ($ in millions, except per share data in $) 2024 2023 2022 Amounts attributable to ABB shareholders: Income from continuing operations, net of tax 3,937 3,769 2,517 Loss from discontinued operations, net of tax (2) (24) (42) Net income 3,935 3,745 2,475 Weighted-average number of shares outstanding (in millions) 1,844 1,855 1,899 Effect of dilutive securities: Call options and shares 7 12 11 Adjusted weighted-average number of shares outstanding (in millions) 1,851 1,867 1,910 Diluted earnings per share attributable to ABB shareholders: Income from continuing operations, net of tax 2.13 2.02 1.32 Loss from discontinued operations, net of tax — (0.01) (0.02) Net income 2.13 2.01 1.30 FINANCIAL REPORT 2024 111 — Note 22 Other comprehensive income The following table includes amounts recorded within Total other comprehensive income (loss) including the related income tax effects: 2024 2023 2022 Before Tax Net of Before Tax Net of Before Tax Net of ($ in millions) tax effect tax tax effect tax tax effect tax Foreign currency translation adjustments: Foreign currency translation adjustments (317) (2) (319) (292) 2 (290) (685) — (685) Net loss on complete or substantially complete liquidations of foreign subsidiaries 14 — 14 — — — 5 — 5 Changes attributable to divestments 9 — 9 9 — 9 41 — 41 Net change during the year (294) (2) (296) (283) 2 (281) (639) — (639) Available-for-sale securities: Net unrealized gains (losses) arising during the year 1 — 1 6 (1) 5 (28) 5 (23) Reclassification adjustments for net (gains) losses included in net income 5 (1) 4 8 (2) 6 2 — 2 Net change during the year 6 (1) 5 14 (3) 11 (26) 5 (21) Pension and other postretirement plans: Prior service (costs) credits arising during the year (15) 5 (10) 1 (2) (1) (2) 2 — Net actuarial gains (losses) arising during the year (24) (13) (37) (339) 57 (282) 298 (72) 226 Amortization of prior service cost (credit) included in net income (11) 1 (10) (11) 2 (9) (13) (3) (16) Amortization of net actuarial loss included in net income 66 (19) 47 48 (10) 38 55 (11) 44 Net gains (losses) from settlements and curtailments included in net income (8) 2 (6) 16 (2) 14 11 (2) 9 Changes attributable to divestments — — — 3 — 3 (8) — (8) Net change during the year 8 (24) (16) (282) 45 (237) 341 (86) 255 Derivative instruments and hedges: Net gains (losses) arising during the year (10) 2 (8) (11) 1 (10) (10) (2) (12) Reclassification adjustments for net (gains) losses included in net income 10 — 10 8 — 8 12 — 12 Net change during the year — 2 2 (3) 1 (2) 2 (2) — Total other comprehensive income (loss) (280) (25) (305) (554) 45 (509) (322) (83) (405) 112 FINANCIAL REPORT 2024 The following table shows changes in Accumulated other comprehensive loss (OCI) attributable to ABB, by component, net of tax: Unrealized Pension and Foreign gains (losses) other post- Accumulated currency on available- retirement Derivative other translation for-sale plan instruments comprehensive ($ in millions) adjustment securities adjustments and hedges loss Balance at January 1, 2022 (2,993) 2 (1,089) (8) (4,088) Other comprehensive (loss) income before reclassifications (685) (23) 226 (12) (494) Amounts reclassified from OCI 46 2 29 12 89 Total other comprehensive (loss) income (639) (21) 255 — (405) Spin-off of the Turbocharging Division (93) — (5) — (98) Less: Amounts attributable to noncontrolling interests (34) — (1) — (35) Balance at December 31, 2022 (1) (3,691) (19) (838) (8) (4,556) Other comprehensive (loss) income before reclassifications (290) 5 (283) (10) (578) Amounts reclassified from OCI 9 6 46 8 69 Total other comprehensive (loss) income (281) 11 (237) (2) (509) Less: Amounts attributable to noncontrolling interests and redeemable noncontrolling interests 5 — — — 5 Balance at December 31, 2023 (3,977) (8) (1,075) (10) (5,070) Other comprehensive (loss) income before reclassifications (319) 1 (47) (8) (373) Amounts reclassified from OCI 23 4 31 10 68 Total other comprehensive (loss) income (296) 5 (16) 2 (305) Less: Amounts attributable to noncontrolling interests and redeemable noncontrolling interests (25) — — — (25) Balance at December 31, 2024 (4,248) (3) (1,091) (8) (5,350) FINANCIAL REPORT 2024 113 The following table reflects amounts reclassified out of OCI in respect of Foreign currency translation adjustments and Pension and other postretirement plan adjustments: ($ in millions) Location of (gains) losses Details about OCI components reclassified from OCI 2024 2023 2022 Foreign currency translation adjustments: Net loss on complete or substantially complete liquidations of foreign subsidiaries Other income (expense), net 14 — 5 Changes attributable to divestments Other income (expense), net 9 9 41 Amounts reclassified from OCI 23 9 46 Pension and other postretirement plan adjustments: Amortization of prior service cost (credit) Non-operational pension (cost) credit (11) (11) (13) Amortization of net actuarial loss Non-operational pension (cost) credit 66 48 55 Net losses from settlements and curtailments Non-operational pension (cost) credit (8) 16 11 Changes attributable to divestments Other income (expense), net — 3 (8) Total before tax 47 56 45 Tax Income tax expense (16) (10) (16) Amounts reclassified from OCI 31 46 29 The amounts reclassified out of OCI in respect of “Unrealized gains (losses) on available ‑ for ‑ sale securities” and “Derivative instruments and hedges” were not significant in 2024, 2023 and 2022. — Note 23 Restructuring and related expenses Restructuring-related activities In 2024, 2023 and 2022, the Company executed various restructuring ‑ related activities and incurred the following charges, net of changes in estimates: ($ in millions) 2024 2023 2022 Employee severance costs 111 120 81 Estimated contract settlement, loss order and other costs 11 7 209 Inventory and long-lived asset impairments 29 49 7 Total 151 176 297 Expenses associated with these activities are recorded in the following line items in the Consolidated Income Statements: ($ in millions) 2024 2023 2022 Total cost of sales 40 65 24 Selling, general and administrative expenses 31 52 40 Non-order related research and development expenses 11 3 2 Other income (expense), net 69 56 231 Total 151 176 297 114 FINANCIAL REPORT 2024 In 2022, the Company completed a plan (initiated in 2021) to fully exit its full train retrofit business by transferring the remaining contracts to a third party. The Company recorded $195 million of restructuring expenses in connection with this business exit primarily for contract settlement costs. Prior to exiting this business, the business was reported as part of the Company’s non-core business activities within Corporate and Other. At December 31, 2024 and 2023, $197 million and $250 million, respectively, was recorded for restructuring-related liabilities and is primarily included in Other provisions. — Note 24 Operating segment and geographic data The Chief Operating Decision Maker (CODM) is the Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment using the information outlined below. The Company is organized into the following segments, based on products and services: Electrification, Motion, Process Automation and Robotics & Discrete Automation. The remaining operations of the Company are included in Corporate and Other. A description of the types of products and services provided by each reportable segment is as follows: • Electrification: manufactures and sells electrical products and solutions which are designed to provide the efficient and reliable distribution of electricity from source to socket. The portfolio of increasingly digital and connected solutions includes renewable power solutions, modular substation packages, distribution automation products, switchboards and panelboards, switchgear, UPS solutions, circuit breakers, measuring and sensing devices, control products, wiring accessories, enclosures and cabling systems and intelligent home and building solutions, designed to integrate and automate lighting, heating, ventilation, security and data communication networks. The products and services are delivered through five operating Divisions: Distribution Solutions, Smart Power, Smart Buildings, Installation Products, and Service, as well as, prior to its sale in July 2023, the Power Conversion Division. • Motion: designs, manufactures and sells drives, motors, generators and traction converters that are driving the low-carbon future for industries, cities, infrastructure and transportation. These products, digital technology and related services enable industrial customers to increase energy efficiency, improve safety and reliability, and achieve precise control of their processes. Building on over 140 years of cumulative experience in electric powertrains, Motion combines domain expertise and technology to deliver the optimum solution for a wide range of applications in all industrial segments. In addition, Motion, along with its partners, has a leading global service presence. These products and services are delivered through seven operating Divisions: Large Motors and Generators, IEC LV Motors, NEMA Motors, Drive Products, System Drives, Service, and Traction. • Process Automation: offers a broad range of industry-specific, integrated automation, electrification and digital solutions, as well as lifecycle services for the process, hybrid and marine industries. The product portfolio includes control technologies, industrial software, advanced analytics, sensing and measurement technology, and marine propulsion systems. In addition, Process Automation offers a comprehensive range of services, from repair to advanced digital capabilities such as remote monitoring, preventive maintenance, asset performance management, emission monitoring and cybersecurity. The products, systems and services are currently delivered through four operating Divisions: Energy Industries, Process Industries, Marine & Ports and Measurement & Analytics, as well as, prior to its spin-off in October 2022, the Turbocharging Division. FINANCIAL REPORT 2024 115 • Robotics & Discrete Automation: delivers its products, solutions and services through two operating Divisions: Robotics provides industrial and collaborative robots, autonomous mobile robotics, mapping and navigation solutions, robotic solutions, field services, spare parts and digital services. Machine Automation specializes in automation solutions based on its programmable logic controllers (PLC), industrial PCs (IPC), servo motion, transport systems and machine vision. Both divisions offer software across the entire life cycle, including engineering and simulation software as well as a comprehensive range of digital solutions. Corporate and Other: Corporate includes headquarter costs, the Company’s corporate real estate activities and Corporate Treasury while Other includes the E-mobility operating segment and other non - core operating activities as well as the operating activities of certain divested businesses. The primary measure of profitability on which the operating segments are evaluated is Operational EBITA, which represents income from operations excluding: • amortization expense on intangibles arising upon acquisition (acquisition-related amortization), • restructuring, related and implementation costs, • changes in the amount recorded for obligations related to divested businesses occurring after the divestment date (changes in obligations related to divested businesses), • gains and losses from sale of businesses (including fair value adjustment on assets and liabilities held for sale, if any), • acquisition- and divestment-related expenses and integration costs, • certain other non-operational items, as well as • foreign exchange/commodity timing differences in income from operations consisting of: (a) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (b) realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized, and (c) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities). Certain other non-operational items generally includes certain regulatory, compliance and legal costs, certain asset write downs/impairments and certain other fair value changes, as well as other items which are determined by management on a case ‑ by ‑ case basis. For all operating segments, the primary performance measure the CODM uses to allocate resources (including capital expenditure and financial resources) and assess performance as part of the monthly business review process is Operational EBITA. As part of this review process, current year - to-date budget-to-actual variances are provided (inclusive of key deviations) along with forecasted annual expectations and plans to address any negative variances. Operational EBITA is also used to assess segment performance against targets set in the annual incentive plans as part of the compensation of the Company’s employees. The CODM primarily reviews the results of each segment on a basis that is before the elimination of profits made on inventory sales between segments. Segment results below are presented before these eliminations, with a total deduction for intersegment profits to arrive at the Company’s consolidated Operational EBITA. Intersegment sales and transfers are accounted for as if the sales and transfers were to third parties, at current market prices. 116 FINANCIAL REPORT 2024 For a category of expense to be classified as a significant segment expense, it must be significant to the segment, regularly provided to or easily computed from information regularly provided to the CODM and included in the primary measure of profitability. Significant segment expenses include Operational cost of sales, Operational selling, general and administrative expenses, and Operational non-order related research and development costs, which respectively are comprised of Cost of sales, Selling, general and administrative expenses (excluding bad debt expense), and Non-order related research and development costs, with each of these expense categories being adjusted to exclude any costs incurred on behalf of other segments and any relevant non-operational items (as defined above). Other segment items represent Other income (expense) excluding its respective components of non-operational items (as defined above), bad debt expense, and foreign exchange/commodity timing differences in total revenues. The following tables present disaggregated segment revenues from contracts with customers, significant segment expenses, and Operational EBITA for 2024, 2023 and 2022: 2024 ($ in millions) Electrification Motion Process Automation Robotics & Discrete Automation Corporate and Other (1) Total Geographical markets Europe 4,566 2,241 2,443 1,648 221 11,119 The Americas 6,577 2,618 1,871 535 204 11,805 of which: United States 5,128 2,122 1,158 329 142 8,879 Asia, Middle East and Africa 4,047 2,353 2,408 1,020 98 9,926 of which: China 1,777 1,098 695 704 22 4,296 15,190 7,212 6,722 3,203 523 32,850 Product type Products 14,129 6,060 3,930 2,622 476 27,217 Services and other 1,061 1,152 2,792 581 47 5,633 15,190 7,212 6,722 3,203 523 32,850 Third-party revenues 15,190 7,212 6,722 3,203 523 32,850 Intersegment revenues 258 575 34 10 (877) — Total revenues 15,448 7,787 6,756 3,213 (354) 32,850 Operational cost of sales (9,285) (5,016) (4,395) (2,110) Operational selling, general and administrative expenses (2,237) (976) (1,009) (563) Operational non-order related research and development expenses (454) (330) (336) (219) Other segment items 48 53 9 8 Operational EBITA 3,520 1,518 1,025 329 FINANCIAL REPORT 2024 117 2023 ($ in millions) Electrification Motion Process Automation Robotics & Discrete Automation Corporate and Other (1) Total Geographical markets Europe 4,547 2,455 2,294 1,932 340 11,568 The Americas 5,926 2,562 1,738 573 291 11,090 of which: United States 4,456 2,123 1,076 358 235 8,248 Asia, Middle East and Africa 3,899 2,276 2,212 1,119 71 9,577 of which: China 1,775 1,148 707 804 34 4,468 14,372 7,293 6,244 3,624 702 32,235 Product type Products 13,437 6,219 3,661 3,063 630 27,010 Services and other 935 1,074 2,583 561 72 5,225 14,372 7,293 6,244 3,624 702 32,235 Third-party revenues 14,372 7,293 6,244 3,624 702 32,235 Intersegment revenues 212 521 26 16 (775) — Total revenues 14,584 7,814 6,270 3,640 (73) 32,235 Operational cost of sales (9,183) (5,167) (4,127) (2,347) Operational selling, general and administrative expenses (2,095) (914) (928) (564) Operational non-order related research and development expenses (427) (287) (295) (201) Other segment items 58 29 (11) 8 Operational EBITA 2,937 1,475 909 536 118 FINANCIAL REPORT 2024 2022 ($ in millions) Electrification Motion Process Automation Robotics & Discrete Automation Corporate and Other (1) Total Geographical markets Europe 4,199 2,031 2,248 1,494 313 10,285 The Americas 5,140 2,148 1,566 524 195 9,573 of which: United States 3,769 1,787 943 373 151 7,023 Asia, Middle East and Africa 4,053 2,101 2,199 1,155 80 9,588 of which: China 1,948 1,147 666 897 38 4,696 13,392 6,280 6,013 3,173 588 29,446 Product type Products 12,535 5,380 3,311 2,695 550 24,471 Services and other 857 900 2,702 478 38 4,975 13,392 6,280 6,013 3,173 588 29,446 Third-party revenues 13,392 6,280 6,013 3,173 588 29,446 Intersegment revenues 227 465 31 8 (731) — Total revenues 13,619 6,745 6,044 3,181 (143) 29,446 Operational cost of sales (8,987) (4,596) (4,022) (2,204) Operational selling, general and administrative expenses (1,975) (796) (913) (488) Operational non-order related research and development expenses (389) (241) (299) (169) Other segment items 75 51 38 20 Operational EBITA 2,343 1,163 848 340 (1) The amounts shown for “Intersegment revenues” within Corporate and Other primarily represents the consolidated intersegment revenue elimination. These amounts include intersegment revenues of $33 million, $67 million and $65 million for 2024, 2023 and 2022, respectively. Revenues by geography reflect the location of the customer. In 2024, 2023 and 2022 the United States and China are the only countries where revenue exceeded 10 percent of total revenues. In each of 2024, 2023 and 2022 more than 98 percent of the Company’s total revenues were generated from customers outside Switzerland. FINANCIAL REPORT 2024 119 The following tables present Operational EBITA, the reconciliations of consolidated Operational EBITA to Income from continuing operations before taxes, as well as Depreciation and amortization, and Capital expenditures for 2024, 2023 and 2022, and Total assets at December 31, 2024, 2023 and 2022: ($ in millions) 2024 2023 2022 Operational EBITA: Electrification 3,520 2,937 2,343 Motion 1,518 1,475 1,163 Process Automation 1,025 909 848 Robotics & Discrete Automation 329 536 340 Corporate and Other: — E-mobility (273) (167) (15) — Corporate costs, intersegment elimination and other (151) (263) (169) Total 5,968 5,427 4,510 Acquisition-related amortization (203) (220) (229) Restructuring, related and implementation costs (1) (178) (219) (347) Changes in obligations related to divested businesses 10 3 88 Gains and losses from sale of businesses 57 101 (7) Fair value adjustment on assets and liabilities held for sale (113) — — Acquisition- and divestment-related expenses and integration costs (73) (74) (195) Foreign exchange/commodity timing differences in income from operations: Unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives) (118) 19 32 Realized gains and losses on derivatives where the underlying hedged transaction has not yet been realized 3 12 (48) Unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) 43 (13) (15) Certain other non-operational items: Other income/expenses relating to the Power Grids joint venture 16 36 (57) Regulatory, compliance and legal costs (12) — (317) Business transformation costs (2) (204) (205) (152) Gains and losses from sale of investments in equity-accounted companies — — 43 Certain other fair value changes, including asset impairments (107) (10) 45 Other non-operational items (18) 14 (14) Income from operations 5,071 4,871 3,337 Interest and dividend income 206 165 72 Interest and other finance expense (99) (275) (130) Non-operational pension (cost) credit 55 17 115 Income from continuing operations before taxes 5,233 4,778 3,394 (1) Includes impairment of certain assets. (2) Amounts in 2024, 2023 and 2022 include ABB Way process transformation costs of $199 million, $188 million and $131 million, respectively. Depreciation and Total assets (1) amortization Capital expenditures (1) at December 31, ($ in millions) 2024 2023 2022 2024 2023 2022 2024 2023 2022 Electrification 395 365 382 472 386 343 13,124 12,668 12,500 Motion 161 149 141 191 171 150 6,895 7,016 6,565 Process Automation 62 56 75 62 66 100 5,330 4,971 4,598 Robotics & Discrete Automation 116 138 141 81 71 86 4,762 5,047 4,901 Corporate and Other 68 72 75 39 76 83 10,246 11,238 10,584 Consolidated 802 780 814 845 770 762 40,357 40,940 39,148 (1) Capital expenditures and Total assets are after intersegment eliminations and therefore reflect third-party activities only. 120 FINANCIAL REPORT 2024 Other geographic information Geographic information for long-lived assets was as follows: Long-lived assets at December 31, ($ in millions) 2024 2023 Europe 2,752 2,762 The Americas 1,369 1,335 Asia, Middle East and Africa 896 938 Total 5,017 5,035 Long ‑ lived assets represent Property, plant and equipment, net and Operating lease right-of-use assets and are shown by location of the assets. At December 31, 2024, approximately 20 percent, 11 percent and 8 percent of the Company’s long ‑ lived assets were located in the United States, China and Switzerland, respectively. At December 31, 2023, approximately 19 percent, 11 percent and 9 percent of the Company’s long ‑ lived assets were located in the United States, China and Switzerland, respectively. 121 Statutory Auditor's Report To the General Meeting of ABB Ltd, Zurich Report on the Audit of the Consolidated Financial Statements Opinion We have audited the consolidated financial statements of ABB Ltd and its subsidiaries (the Group), which comprise the consolidated balance sheets as at December 31, 2024 and 2023, the related consolidated income statements, consolidated statements of comprehensive income, consolidated statements of changes in stockholders’ equity, and consolidated statement of cash flows for each of the years in the three-year period ended December 31 , 2024, and the related notes to the consolidated financial statements, including a summary of significant accounting policies. In our opinion, the consolidated financial statements (pages 55 to 120) present fairly, in all material respects, the financial position of the Group as at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles (U.S. GAAP) and comply with Swiss law. Basis for Opinion We conducted our audit in accordance with Swiss law, International Standards on Auditing (ISA) and Swiss Standards on Auditing (SA-CH). Our responsibilities under those provisions and standards are further described in the “Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements” section of our report. We are independent of the Group in accordance with the provisions of Swiss law, together with the requirements of the Swiss audit profession, as well as those of the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters Revenue recognition for certain long-term fixed-price contracts using percentage-of-completion method C Valuation of goodwill for the Machine Automation reporting unit Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, we do not provide a separate opinion on these matters. 122 Revenue recognition for certain long-term fixed-price contracts using percentage-of-completion method Key Audit Matter The Group recognizes a portion of its revenues from the sale of customized products, including long-term fixed-price contracts for integrated automation and electrification systems and solutions that are generally recognized on an over time basis using the percentage-of-completion method of accounting. We identified the determination of estimated costs to complete related to revenue recognition of certain long-term fixed-price contracts using the percentage-of-completion method of accounting as a key audit matter. In particular, a high degree of subjective auditor judgment was required to evaluate the Group’s estimate regarding the amount of future direct materials, labor and subcontractor costs, as well as indirect costs to complete the contracts. Our response As part of our audit, we obtained an understanding of the Group’s accounting process specific to fixed- price contracts which are recognized using the percentage-of-completion method. We evaluated the design and implementation of certain internal controls over the development of estimates regarding the amount of future direct materials, labor and subcontractor costs, as well as indirect costs. We assessed the Group’s historical ability to accurately estimate costs to complete by comparing historical estimate-to-actual results for a selection of long-term contracts. We evaluated the estimate of remaining costs to be incurred for a selection of contracts by assessing progress to date and the nature and complexity of work to be performed through interviewing project managers and inspecting correspondence, if any, between the Group and the customers and/or subcontractors. For further information on Revenue recognition for certain long-term fixed-price contracts using percentage- of-completion method refer to the following: — Note 2 Significant accounting policies 123 Valuation of goodwill for the Machine Automation reporting unit Key Audit Matter The Group evaluates goodwill for impairment annually as of October 1 , or more frequently if events or circumstances indicate that the carrying value may not be recoverable. The fair value for the quantitative impairment assessment is determined using an income approach based on the present value of the future cash flows of the reporting unit. Management’s income approach to the estimate requires certain assumptions, specifically projected revenue growth rates and projected operational earnings before interest, tax, and acquisition-related amortization (“EBITA”) margin. We identified the valuation of goodwill for the Machine Automation goodwill reporting unit (GRU) as a key audit matter. The division’s performance in the current financial year and its future outlook combined with a lower excess of fair value over carrying value make the goodwill impairment test and a potential impairment highly sensitive to these assumptions. A high degree of subjective auditor judgment and specialized skills and knowledge was required to evaluate the projected revenue growth rates and projected operational EBITA margins used in the Group’s impairment test. Our response As part of our audit, we obtained an understanding of the Group’s accounting process specific to impairment testing. We evaluated the design and implementation of internal control over management’s review of the projected revenue growth rates and projected operational EBITA margin assumptions. We assessed the Group’s ability to accurately prepare projections for the Machine Automation reporting unit by comparing the projected revenues from past periods to actual results for the same periods. Additionally, we evaluated the assumptions of the GRU’s projected revenue growth rates and projected operational EBITA margins used in management’s discounted cash flow analysis by comparing projections to past historical performance of the reporting unit. We involved valuation professionals with specialized skills and knowledge who assisted in assessing the reasonableness of the projected revenue growth rates and projected operational EBITA margins by comparing the assumptions to relevant industry trends and current market indices of comparable peer companies. For further information on valuation of goodwill for the Machine Automation Reporting unit refer to the following: — Note 2 Significant accounting policies — Note 11 Goodwill and intangible assets 124 Other Information in the ABB Annual Reporting Suite The Board of Directors is responsible for the other information. The other information comprises the information included in the ABB Annual Reporting Suite (consisting of the Integrated Report, the Financial Report, the Corporate Governance Report, the Compensation Report, and the Sustainability Statement), but does not include the consolidated financial statements, the statutory financial statements of ABB Ltd, the audited content of the compensation report and our auditor’s reports thereon. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Board of Directors’ Responsibilities for the Consolidated Financial Statements The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with U.S. GAAP and the provisions of Swiss law, and for such internal control as the Board of Directors determines is necessary to enable the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law, ISA and SA-CH will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with Swiss law, ISA and SA-CH, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: — Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. 125 — Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. — Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made. — Conclude on the appropriateness of the Board of Directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. — Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. — Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Group as a basis for forming an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion. We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the Board of Directors or its relevant committee with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated to the Board of Directors or its relevant committee, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report, unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. 126 Report on Other Legal and Regulatory Requirements In accordance with Art. 728a para. 1 item 3 CO and PS-CH 890, we confirm that an internal control system exists, which has been designed for the preparation of the consolidated financial statements according to the instructions of the Board of Directors. We recommend that the consolidated financial statements submitted to you be approved. KPMG AG Achim Wolper Licensed Audit Expert Auditor in Charge Mohamad Midani Zurich, Switzerland February 26, 2025 © 2025 KPMG AG, a Swiss corporation, is a group company of KPMG Holding LLP, which is a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. tXPtRls- ssc zortr zio'tosUntc'nchmo" 128 ABB Ltd Management Report 129 Financial statements and Notes 141 Proposed appropriation of available earnings 142 Report of the Statutory Auditor on the Financial Statements 128 FINANCIAL REPORT 2024 — ABB LTD MANAGEMENT REPORT 2024 ABB Ltd is the holding company of the ABB Group, owning directly or indirectly all subsidiaries globally. The major business activities during 2024 can be summarized as follows: Management services The Company provided management services to Group companies for CHF 27 million. Share transactions • share deliveries in relation to employee share programs of CHF 670 million • share cancellations of CHF 733 million: those shares were repurchased under share buyback program in 2023/24 • share repurchases of CHF 881 million under share buyback program in 2024/25 for cancellation purposes • share repurchases for employee share programs of CHF 216 million Dividend distribution to external shareholders • from retained earnings brought forward of CHF 1,451 million Other information In 2024, the Company employed on average 18 employees. Once a year, the Company’s Board of Directors performs a risk assessment in accordance with the Group’s risk management process and discusses appropriate actions if necessary. The Company does not carry out any research and development activities. In 2025, the Company will continue to operate as the holding company of the ABB Group. No change of business is expected. February 26, 2025 FINANCIAL REPORT 2024 129 — FINANCIAL STATEMENTS 2024 INCOME STATEMENT Year ended December 31 (CHF in thousands) Note 2024 2023 Dividend income 7 2,600,000 — Finance income 60,257 126,228 Other operating income 8 32,935 31,718 Gain on sale of participation 2 8,019 536 Total income 2,701,211 158,482 Finance expense (193,820) (169,504) Personnel expenses (55,904) (58,981) Other operating expenses 9 (17,781) (15,705) Total expenses (267,505) (244,190) Net income/(loss) before taxes 2,433,706 (85,708) Net income/(loss) 2,433,706 (85,708) 130 FINANCIAL REPORT 2024 BALANCE SHEET December 31 (CHF in thousands) Note 2024 2023 Cash 302 545 Cash deposit with ABB Capital Ltd 391,648 189,664 Non-trade receivables 1,137 81 Non-trade receivables – Group 87,672 48,750 Short-term loans – Group 22,628 271,814 Accrued income and prepaid expenses 188 1,440 Accrued income and prepaid expenses – Group 43 195 Total current assets 503,618 512,489 Long-term loans – Group 248,902 — Participations 2 5,709,367 5,709,367 Other non-current assets 3,839 5,102 Total non-current assets 5,962,108 5,714,469 Total assets 6,465,726 6,226,958 Interest-bearing liabilities 4 150,003 280,013 Interest-bearing liabilities – Group 4 22,628 271,814 Non-trade payables 25,184 29,974 Non-trade payables – Group 8,976 1,696 Current provisions 8,545 35,030 Deferred income and accrued expenses 28,414 33,109 Deferred income and accrued expenses – Group 4,243 12,520 Total current liabilities 247,993 664,156 Interest-bearing liabilities 4 1,495,399 1,645,534 Interest-bearing liabilities – Group 4 248,902 — Total non-current liabilities 1,744,301 1,645,534 Total liabilities 1,992,294 2,309,690 Share capital 6 223,274 225,840 Legal retained earnings 6 1,000,000 1,000,000 Treasury shares 6 (984,382) (1,290,941) Available earnings Retained earnings brought forward 6 1,800,834 4,068,077 Net income/(loss) 2,433,706 (85,708) Total shareholders' equity 4,473,432 3,917,268 Total liabilities and shareholders’ equity 6,465,726 6,226,958 FINANCIAL REPORT 2024 131 — NOTES TO THE FINANCIAL STATEMENTS — Note 1 General ABB Ltd, Zurich, Switzerland (the Company) is the parent company of the ABB Group. Its stand-alone financial statements are prepared in accordance with Article 957 et seqq. of Title 32 of the Swiss Code of Obligations. Group companies are all companies which are directly or indirectly controlled by the Company and any variable interest entities if it is determined that the Company is the primary beneficiary. — Note 2 Participations 2024 2023 Company name Purpose Domicile Share capital Ownership and voting rights Share capital Ownership and voting rights ABB Asea Brown Boveri Ltd Holding CH-Zurich CHF 2,767,880,000 100.00% CHF 2,767,880,000 100.00% Participations are valued at the lower of cost or fair value, using generally accepted valuation principles. In 2024, an adjustment of CHF 8 million was recorded in “Gain on sale of participation” related to the sale of Power Grids business. — Note 3 Indirect Participations The following table sets forth the name, country of incorporation, ownership and voting rights, as well as share capital, of the significant indirect subsidiaries of the Company, as of December 31, 2024 and 2023. Company name/Location Country Company ownership and voting rights % 2024 Share capital in thousands 2024 Company ownership and voting rights % 2023 Share capital in thousands 2023 Currency ABB S.A.U., Buenos Aires Argentina 100.00 25,659,498 — (2) — (2) ARS ABB Australia Pty. Limited, Moorebank Australia 100.00 71,218 100.00 131,218 AUD ABB Group Holdings Pty. Ltd., Moorebank Australia — (3) — (3) 100.00 537,988 (5) AUD ABB Group Investment Management Pty. Ltd., Moorebank Australia 100.00 403,318 100.00 520,318 (5) AUD ABB AG, Wiener Neudorf Austria 100.00 15,000 100.00 15,000 EUR B&R Holding GmbH, Eggelsberg Austria 100.00 35 100.00 35 EUR B&R Industrial Automation GmbH, Eggelsberg Austria 100.00 1,240 100.00 1,240 EUR ABB N.V., Zaventem Belgium 100.00 4,000 100.00 4,000 EUR ABB AUTOMAÇÃO LTDA., Sorocaba Brazil 100.00 191,039 100.00 191,039 BRL 132 FINANCIAL REPORT 2024 Company name/Location Country Company ownership and voting rights % 2024 Share capital in thousands 2024 Company ownership and voting rights % 2023 Share capital in thousands 2023 Currency ABB ELETRIFICAÇÃO LTDA., Sorocaba Brazil 100.00 268,759 100.00 268,759 BRL ABB Bulgaria EOOD, Sofia Bulgaria 100.00 65,110 100.00 65,110 BGN ABB Electrification Canada Inc., Saint-Laurent Canada 100.00 — (1) 100.00 — (1) CAD ABB Inc., Saint-Laurent Canada 100.00 — (1) 100.00 — (1) CAD ABB S.A., Santiago Chile 100.00 5,484,348 100.00 5,484,348 CLP ABB (China) Investment Limited, Beijing China 100.00 95,000 100.00 95,000 USD ABB (China) Ltd., Beijing China 100.00 140,000 100.00 140,000 USD ABB Beijing Drive Systems Co. Ltd., Beijing China 90.00 5,000 90.00 5,000 USD ABB Beijing Switchgear Limited, Beijing China 60.00 16,500 60.00 16,500 USD ABB Electrical Machines Ltd., Shanghai China 100.00 14,400 100.00 14,400 USD ABB Engineering (Shanghai) Ltd., Shanghai China 100.00 40,000 100.00 40,000 USD ABB LV Installation Materials Co. Ltd. Beijing, Beijing China 85.70 17,100 85.70 17,100 USD ABB Shanghai Free Trade Zone Industrial Co., Ltd., Shanghai China 100.00 6,500 100.00 6,500 CNY ABB Shanghai Motors Co. Ltd., Shanghai China 75.00 11,217 75.00 11,217 USD ABB Xiamen Low Voltage Equipment Co. Ltd., Xiamen China 100.00 15,800 100.00 15,800 USD ABB Xiamen Switchgear Co. Ltd., Xiamen China 66.52 29,500 66.52 29,500 USD ABB Xinhui Low Voltage Switchgear Co. Ltd., Xinhui China 90.00 6,200 90.00 6,200 USD ABB s.r.o., Prague Czech Republic 100.00 400,000 100.00 400,000 CZK ABB A/S, Middelfart (6) Denmark 100.00 100,000 100.00 100,000 DKK ABB for Electrical Industries (ABB ARAB) S.A.E., Cairo Egypt 100.00 353,479 100.00 353,479 EGP Asea Brown Boveri S.A.E., Cairo Egypt 100.00 166,000 100.00 166,000 USD ABB AS, Jüri Estonia 100.00 1,663 100.00 1,663 EUR ABB Oy, Helsinki Finland 100.00 10,003 100.00 10,003 EUR ABB France, Cergy Pontoise France 99.84 25,778 99.84 25,778 EUR ABB SAS, Cergy Pontoise France 100.00 45,921 100.00 45,921 EUR ABB AG, Mannheim Germany 100.00 167,500 100.00 167,500 EUR ABB Beteiligungs- und Verwaltungsgesellschaft mbH, Mannheim Germany 100.00 61,355 100.00 61,355 EUR ABB Stotz-Kontakt GmbH, Heidelberg Germany 100.00 7,500 100.00 7,500 EUR ABB Striebel & John GmbH, Sasbach Germany 100.00 1,050 100.00 1,050 EUR B + R Industrie-Elektronik GmbH, Friedberg (7) Germany 100.00 358 100.00 358 EUR Busch-Jaeger Elektro GmbH, Lüdenscheid Germany 100.00 1,535 100.00 1,535 EUR ABB Business Services Private Limited, Bangalore (8) India 100.00 5,200,100 100.00 5,200,100 INR ABB Global Industries and Services Private Limited, Bangalore India 100.00 366,923 100.00 366,923 INR ABB India Limited, Bangalore India 75.00 423,817 75.00 423,817 INR ABB Limited, Dublin Ireland 100.00 635 100.00 635 EUR ABB E-mobility S.p.A., Milan Italy 74.34 20,000 74.70 20,000 EUR ABB S.p.A., Milan Italy 100.00 110,000 100.00 110,000 EUR ABB K.K., Tokyo Japan 100.00 1,000,000 100.00 1,000,000 JPY ABB Ltd., Seoul Korea, Republic of 100.00 16,950,000 100.00 23,670,000 KRW ABB Electrical Control Systems S. de R.L. de C.V., Monterrey Mexico 100.00 712,463 100.00 712,463 MXN ABB Mexico S.A. de C.V., San Luis Potosi Mexico 100.00 1,135,752 100.00 1,135,752 MXN Asea Brown Boveri S.A. de C.V., San Luis Potosi Mexico 100.00 667,686 100.00 667,686 MXN ABB B.V., Rotterdam Netherlands 100.00 9,200 100.00 9,200 EUR ABB E-mobility B.V., Delft Netherlands 74.34 1 74.70 1 EUR ABB Finance B.V., Rotterdam Netherlands 100.00 20 100.00 20 EUR ABB Holdings B.V., Rotterdam Netherlands 100.00 363 100.00 363 EUR ABB AS, Fornebu Norway 100.00 134,550 100.00 134,550 NOK ABB Electrification Norway AS, Skien Norway 100.00 60,450 100.00 60,450 NOK ABB Holding AS, Fornebu Norway 100.00 240,000 100.00 240,000 NOK ABB Business Services Sp. z o.o., Warsaw Poland 99.94 24 99.94 24 PLN ABB Sp. z o.o., Warsaw Poland 99.94 245,461 99.94 245,461 PLN Industrial C&S of P.R. LLC, Arecibo Puerto Rico 100.00 — (1) 100.00 — (1) USD FINANCIAL REPORT 2024 133 Company name/Location Country Company ownership and voting rights % 2024 Share capital in thousands 2024 Company ownership and voting rights % 2023 Share capital in thousands 2023 Currency ABB Electrical Industries Co. Ltd., Riyadh Saudi Arabia 65.00 100,000 65.00 181,000 SAR ABB Pte. Ltd., Singapore Singapore 100.00 32,797 100.00 32,797 SGD ABB Holdings (Pty) Ltd., Modderfontein South Africa 100.00 217,758 100.00 217,758 ZAR ABB Investments (Pty) Ltd., Modderfontein South Africa 51.00 185,978 51.00 185,978 ZAR ABB South Africa (Pty) Ltd., Modderfontein South Africa 74.91 3,835,544 74.91 3,835,544 ZAR Asea Brown Boveri S.A., Madrid Spain 100.00 33,318 100.00 33,318 EUR ABB AB, Västerås Sweden 100.00 200,000 100.00 200,000 SEK ABB Electrification Sweden AB, Västerås Sweden 100.00 10,000 100.00 10,000 SEK ABB Norden Holding AB, Västerås Sweden 100.00 2,344,783 100.00 2,344,783 SEK ABB Capital AG, Zurich Switzerland 100.00 100 100.00 100 CHF ABB E-mobility Holding Ltd, Zurich Switzerland 74.34 1,138 74.70 1,138 CHF ABB Schweiz AG, Baden Switzerland 100.00 55,000 100.00 55,000 CHF ABB Ltd., Taipei Taiwan (Chinese Taipei) 100.00 195,000 100.00 195,000 TWD ABB Elektrik Sanayi A.S., Istanbul Türkiye 99.99 165,000 99.99 165,000 TRY ABB Industries (L.L.C.), Dubai United Arab Emirates 100.00 5,000 49.00 (4) 5,000 (4) AED ABB Industries FZE, Dubai United Arab Emirates 100.00 3,000 100.00 3,000 AED ABB Holdings Limited, Warrington United Kingdom 100.00 226,014 100.00 226,014 GBP ABB Limited, Warrington United Kingdom 100.00 120,000 100.00 120,000 GBP ABB E-mobility Inc., Wilmington, DE United States 74.34 — 74.70 — USD ABB Finance (USA) Inc., Wilmington, DE United States 100.00 1 100.00 1 USD ABB Holdings Inc., Cary, NC United States 100.00 2 100.00 2 USD ABB Inc., Cary, NC United States 100.00 1 100.00 1 USD ABB Installation Products Inc., Memphis, TN United States 100.00 1 100.00 1 USD ABB Motors and Mechanical Inc., Fort Smith, AR United States 100.00 — (1) 100.00 — (1) USD ABB Treasury Center (USA), Inc., Wilmington, DE United States 100.00 1 100.00 1 USD Edison Holding Corporation, Wilmington, DE United States 100.00 — (1) 100.00 — (1) USD Industrial Connections & Solutions LLC, Cary, NC United States 100.00 — (1) 100.00 — (1) USD (1) Shares without par value. (2) Based on the internally defined thresholds, these indirect participations are considered not significant, and therefore no details to these participations are disclosed in the respective year. (3) Participation was either sold, liquidated or merged in 2024. (4) Company consolidated as ABB exercises full management control. (5) Share capital adjusted to current facts and circumstances. (6) In 2024, location changed from Skovlunde to Middelfart. (7) In 2024, location changed from Bad Homburg to Friedberg. (8) In 2024, name changed from ABB Global Business Services and Contracting India Private Limited to ABB Business Services Private Limited. 134 FINANCIAL REPORT 2024 — Note 4 Interest-bearing liabilities December 31 (CHF in thousands) 2024 2023 Bonds 2019 – 2024 0.3% coupon nominal value — 280,000 premium on issuance — 13 Bonds 2019 – 2029 1.0% coupon nominal value 170,000 170,000 premium on issuance 94 115 Bonds 2022 – 2025 2.10% coupon nominal value 150,000 150,000 premium on issuance 3 7 Bonds 2022 – 2027 0.75% coupon nominal value 425,000 425,000 premium on issuance 289 393 Bonds 2022 – 2030 2.375% coupon nominal value 150,000 150,000 premium on issuance 16 19 Bonds 2023 – 2026 1.965% coupon nominal value 325,000 325,000 premium on issuance — — Bonds 2023 – 2028 1.9775% coupon nominal value 150,000 150,000 premium on issuance — — Bonds 2023 – 2033 2.1125% coupon nominal value 275,000 275,000 premium on issuance — — Loan 2016 – 2028 $300 million (in 2023 $325 million) 271,530 271,814 Total 1,916,932 2,197,361 Bonds are valued at nominal value. Any bond premium is accrued over the duration of the bond so that at maturity, the balance sheet amount equals the amount that is due to be paid. In August 2024, the Company repaid at maturity its CHF 280 million 0.3% bonds. In September 2023, the Company issued the following bonds: (i) CHF 325 million 1.965% bonds due in 2026, (ii) CHF 150 million 1.9775% bonds due in 2028 and (iii) CHF 275 million 2.1125% bonds due in 2033. Each of the respective bonds pays interest annually. The Company has the option, three months before their maturity date, to redeem each of these bonds, in whole but not in part, at par plus accrued interest. Further, the Company has the option to redeem the above bonds prior to maturity, in whole but not in part, at par plus accrued interest, if 85% or more of the aggregate principal amount of the relevant bond issue has been redeemed or purchased and cancelled at the time of the option exercise notice. In October 2022, the Company issued the following bonds: (i) CHF 150 million 2.1% bonds due in 2025 and (ii) CHF 150 million 2.375% bonds due in 2030. Each of the respective bonds pays interest annually. The Company has the option, three months before their maturity date, to redeem each of these bonds, in whole but not in part, at par plus accrued interest. Further, the Company has the option to redeem the above bonds prior to maturity, in whole but not in part, at par plus accrued interest, if 85% or more of the aggregate principal amount of the relevant bond issue has been redeemed or purchased and cancelled at the time of the option exercise notice. In March 2022, the Company issued CHF 425 million 0.75% bonds due in 2027. The interest on those bonds is paid annually. The Company has the option, one month before their maturity date, to redeem the bonds, in whole but not in part, at par plus accrued interest. Further, the Company has the option to redeem the bonds prior to maturity, in whole but not in part, at par plus accrued interest, if 85% or more of the aggregate principal amount of the relevant bond issue has been redeemed or purchased and cancelled at the time of the option exercise notice. In February 2019, the Company issued CHF 170 million 1.0% bonds due in 2029. The interest on those bonds is paid annually in May. The Company has the option, three months before their maturity date, to redeem the bonds, in whole but not in part, at par plus accrued interest. Further, the Company has the option to redeem the bonds prior to maturity, in whole but not in part, at par plus accrued interest, if 85% or more of the aggregate principal amount of the relevant bond issue has been redeemed or purchased and cancelled at the time of the option exercise notice. FINANCIAL REPORT 2024 135 In 2016, the Company entered into an 8-year borrowing agreement of USD 500 million with ABB Capital Ltd to hedge a USD 500 million loan granted to a Group Company. In 2024, the borrowing agreement was amended and extended by 4 years. Both the original and the extended agreement have an amortization schedule of USD 25 million per annum. The average interest in 2024 and 2023 was 6.20% and 6.01%, respectively. — Note 5 Contingent liabilities With certain Group companies, the Company has keep-well agreements. A keep-well agreement is a shareholder agreement between the Company and a Group company. These agreements provide for maintenance of a minimum net worth in the Group company and the maintenance of 100% direct or indirect ownership by the Company. The keep-well agreements additionally provide that if at any time the Group company has insufficient liquid assets to meet any payment obligation on its debt (as defined in the agreements) and has insufficient unused commitments under its credit facilities with its lenders, the Company will make available to the Group company sufficient funds to enable it to fulfill such payment obligation as it falls due. A keep-well agreement is not a guarantee by the Company for payment of the indebtedness, or any other obligation, of a Group company. No party external to the ABB Group is a party to any keep-well agreement. The Company has also provided certain guarantees securing the payment obligations of certain Group companies in connection with debt issuance and commercial paper programs, indentures, or other debt instruments. The amount guaranteed under these instruments was CHF 4,494 million as of December 31, 2024, and CHF 4,534 million as of December 31, 2023. Additionally, the Company has provided certain guarantees securing the performance of contracts and undertakings of Group companies with third parties entered into in the normal course of business with an aggregate value of CHF 72 million as per December 31, 2024, and CHF 67 million as per December 31, 2023. Furthermore, the Company is the guarantor in the Group’s USD 2 billion multicurrency revolving credit facility (“Group Facility”). In December 2019, the Group Facility was entered into and originally scheduled to mature in 2024. In 2021, the Company exercised its option to extend the maturity of this facility to 2026. No amounts were drawn under this Group Facility at December 31, 2024 and 2023. The Company through certain of its direct and indirect subsidiaries is involved in various regulatory and legal matters. The Company’s direct and indirect subsidiaries have made certain related provisions as further described in “Note 15 Commitments and contingencies” to the Consolidated Financial Statements of ABB Ltd. As described in the note, there is a risk of adverse outcomes beyond the provisioned amounts. The Company is part of a value added tax Group and therefore is jointly liable to the Swiss Federal Tax Department for the value added tax liabilities of the other members. 136 FINANCIAL REPORT 2024 — Note 6 Stockholders’ equity Legal reserves Available earnings (CHF in thousands) Share capital from retained earnings from retained earnings brought forward Net income /(loss) Treasury shares Total Opening balance at January 1, 2024 225,840 1,000,000 4,068,077 (85,708) (1,290,941) 3,917,268 Allocation to retained earnings brought forward (85,708) 85,708 — Cancellation of shares (2,566) (730,422) 732,988 — Dividend payment CHF 0.87 per share (1,451,113) (1,451,113) Purchases of treasury shares (1,096,075) (1,096,075) Delivery of treasury shares 669,646 669,646 Net income/(loss) for the year 2,433,706 2,433,706 Closing balance at December 31, 2024 223,274 1,000,000 1,800,834 2,433,706 (984,382) 4,473,432 Share capital as of December 31, 2024 Number of registered shares Par value (CHF) Total (CHF in thousands) Issued shares 1,860,614,888 0.12 223,274 Contingent shares 304,038,800 0.12 36,485 Capital Band available increase 196,474,500 0.12 23,577 Capital Band available decrease (92,344,313) 0.12 (11,081) Share capital as of December 31, 2023 Number of registered shares Par value (CHF) Total (CHF in thousands) Issued shares 1,882,002,575 0.12 225,840 Contingent shares 304,038,800 0.12 36,485 Capital Band available increase 196,474,500 0.12 23,577 Capital Band available decrease (113,732,000) 0.12 (13,648) Treasury shares are valued at acquisition cost. During 2024 and 2023, a loss from the delivery of treasury shares of CHF 116 million and CHF 46 million, respectively, was recorded in the Income Statement under Finance expense. FINANCIAL REPORT 2024 137 During 2024, a bank holding call options related to ABB Group’s management incentive plan (MIP) exercised a portion of these options. Such options had been issued in 2018 and 2019 by the Group company that facilitates the MIP at fair value and had adjusted strike prices of CHF 22.05 and CHF 17.63, respectively. At issuance, the Group company had entered into an intercompany option agreement with the Company, having the same terms and conditions to enable it to meet its future obligations. As a result of the exercise by the bank, the Company delivered 14,386,669 shares at CHF 22.05 and 2,398,642 shares at CHF 17.63, out of treasury shares. During 2023, a bank holding call options related to ABB Group’s management incentive plan (MIP) exercised a portion of these options. Such options had been issued in 2017 and 2019 by the Group company that facilitates the MIP at fair value and had strike prices of CHF 21.23 and CHF 17.63, respectively. At issuance, the Group company had entered into an intercompany option agreement with the Company, having the same terms and conditions to enable it to meet its future obligations. As a result of the exercise by the bank, the Company delivered to the bank 1,440,850 shares at CHF 21.23 and 4,082,844 shares at CHF 17.63, out of treasury shares. The ABB Group has an annual employee share acquisition plan (ESAP) which provides share options to employees globally. To enable the Group company that facilitates the ESAP to deliver shares to employees who have exercised their stock options under the ESAP, the Group company entered into an agreement with the Company to acquire the required number of shares at their then market value from the Company. Consequently, in 2024, the Company delivered, out of treasury shares, to the Group company 1,531,249 shares at CHF 49.85. In 2023, the Company delivered, out of treasury shares, to the Group company 1,266,178 shares at CHF 33.54. In 2024 and 2023, the Company transferred 2,659,053 and 3,484,043 treasury shares at an average acquisition price per share of CHF 33.15 and CHF 29.16, respectively, to fulfill its obligations under other share-based arrangements. In 2024, the Company purchased 5 million shares, for CHF 216 million, to support its employee share programs globally and 19 million shares, for CHF 881 million, as part of its share buyback programs for capital reduction purposes announced on March 28, 2024, and March 31, 2023. In 2023, the Company purchased 9 million shares, for CHF 310 million, to support its employee share programs globally and 25 million shares, for CHF 804 million, as part of its share buyback programs for capital reduction purposes announced on March 31, 2023, and March 31, 2022. Following the introduction of a capital band as approved by the Company’s shareholders at its Annual General Meeting 2023, the Company has a capital band ranging from CHF 212 million (lower limit) to CHF 259 million (upper limit). The Board of Directors is authorized within the capital band to increase or reduce the share capital once or several times and in any amounts or to acquire or dispose of shares directly or indirectly, until March 23, 2028, or until an earlier expiry of the capital band. In 2024, the Board of Directors resolved to cancel under the above referred capital band 21,387,687 shares repurchased under 2023/24 share buyback program. These shares were cancelled in May 2024, resulting in a reduced total number of issued ABB Ltd shares of 1,860,614,888, and a decrease of CHF 733 million in treasury shares and a corresponding combined decrease in share capital and retained earnings brought forward. The movement in the number of treasury shares during the year was as follows: 2024 2023 Number of shares Average acquisition price per share (in CHF) Number of shares Average acquisition price per share (in CHF) Opening balance as of January 1 40,495,329 31.88 99,741,744 28.77 Purchases for employee share programs 5,112,500 42.16 9,100,000 34.08 Purchases for intended cancellation 19,178,071 45.91 24,670,000 32.58 Cancellation (21,387,687) 34.27 (82,742,500) 28.88 Delivery for employee share programs (20,975,613) 31.92 (10,273,915) 29.40 Closing balance as of December 31 22,422,600 43.90 40,495,329 31.88 Thereof pledged for MIP 406,303 2,919,226 138 FINANCIAL REPORT 2024 — Note 7 Dividend income In 2024, the Company received dividend payments from ABB Asea Brown Boveri Ltd of CHF 2.6 billion in cash. As planned, the Company did not receive any dividend payments in 2023 from ABB Asea Brown Boveri Ltd. — Note 8 Other operating income Other operating income includes mainly outgoing charges for Business Area and Division management services and guarantee compensation fees to Group companies. — Note 9 Other operating expenses In 2024 and 2023, Other operating expenses included usual operating expenses. — Note 10 Shareholdings of Board members and Executive Committee members At December 31, 2024 and 2023, the members of the Board of Directors as of that date, held the following numbers of shares: Board ownership of ABB shares Total numbers of shares held Name December 31, 2024 December 31, 2023 Peter Voser 206,652 215,876 Jacob Wallenberg — 251,318 Gunnar Brock — 41,785 David Constable 49,070 46,319 Frederico Curado 62,905 57,181 Lars Förberg 86,927 80,095 Johan Forssell 1,283 — Denise Johnson 9,723 3,929 Jennifer Xin-Zhe Li 49,968 45,812 Geraldine Matchett 39,530 36,023 David Meline (1) 51,387 47,948 Mats Rahmström (2) 4,858 — Total 562,303 826,286 (1) Includes 3,150 shares held by spouse. (2) Includes 735 shares held by family members. As part of their compensation, the members of the Board received 62,444 shares (amounting to CHF 3,262,500) and 87,948 shares (amounting to CHF 3,290,000) in 2024 and 2023, respectively. FINANCIAL REPORT 2024 139 At December 31, 2024, the members of the Executive Committee as of that date, held the following number of shares, the conditional rights to receive ABB shares under the Long-term Incentive Plan (LTIP) and unvested shares in respect of other compensation arrangements. Total number of shares held at December 31, 2024 Unvested at December 31, 2024 Reference number of shares under the 2022 performance factors (EPS, TSR and sustainability) of the LTIP (1) Reference number of shares under the 2023 performance factors (EPS, TSR and sustainability) of the LTIP (1) Reference number of shares under the 2024 performance factors (EPS, TSR and sustainability) of the LTIP (1) Replacement share grant for foregone benefits from former employer (2) Replacement share grant for foregone benefits from former employer (2) Replacement share grant for foregone benefits from former employer (2) Name (vesting 2025) (vesting 2026) (vesting 2027) (vesting 2025) (vesting 2026) (vesting 2027) Morten Wierod (CEO as of August 1, 2024) 170,999 28,736 31,210 59,509 — — — Timo Ihamuotila 200,000 31,609 31,691 26,184 — — — Carolina Granat (3) 38,018 23,148 23,208 19,175 — — — Mathias Gärtner (EC member as of November 1, 2024) — — — 31,738 6,275 33,057 34,002 Karin Lepasoon 690 19,157 19,207 15,869 — — — Sami Atiya 100,000 25,543 25,609 21,159 — — — Peter Terwiesch 100,330 26,501 27,529 22,746 — — — Brandon Spencer (EC member as of August 1, 2024) — 9,541 16,013 26,545 — — — Giampiero Frisio (EC member as of August 1, 2024) 1,381 14,404 21,249 30,091 — — — Total Executive Committee members at December 31, 2024 611,418 178,639 195,716 253,016 6,275 33,057 34,002 (1) The final 2022 LTIP, 2023 LTIP and 2024 LTIP awards will be settled 100 percent in shares, with an automatic sell-to-cover in place for employees who are subject to withholding taxes. (2) The first tranche of the replacement share grant consists of Restricted Share Units and will vest one year after the grant. The second and the third tranche of the replacement share grant consist of Performance Share Units and will vest two respectively three years after the grant. The vesting level of the Performance Share Units depends on the achievement of the applicable performance targets. The final replacement awards will be settled 100 percent in shares. Shares are entitled to receive dividend equivalent payment on the final number of vested shares. (3) This includes 1,200 shares held by spouse. 140 FINANCIAL REPORT 2024 At December 31, 2023, the members of the Executive Committee, as of that date, held the following number of shares, the conditional rights to receive ABB shares under the Long-term Incentive Plan (LTIP) and unvested shares in respect of other compensation arrangements. Unvested at December 31, 2023 Total number of shares held at December 31, 2023 Reference number of shares deliverable under the 2021 performance factors (EPS and TSR) of the LTIP (1) Reference number of shares deliverable under the 2022 performance factors (EPS, TSR and sustainability) of the LTIP (1) Reference number of shares deliverable under the 2023 performance factors (EPS, TSR and sustainability) of the LTIP (1) Name (vesting 2024) (vesting 2025) (vesting 2026) Björn Rosengren 262,334 99,450 85,487 85,708 Timo Ihamuotila 202,000 37,830 31,609 31,691 Carolina Granat (2) 5,200 27,301 23,148 23,208 Karin Lepasoon 360 — 19,157 19,207 Sami Atiya 100,000 31,201 25,543 25,609 Tarak Mehta 134,710 36,271 29,694 29,770 Peter Terwiesch 100,000 31,201 26,501 27,529 Morten Wierod 141,267 31,201 28,736 31,210 Total Executive Committee members at December 31, 2023 945,871 294,455 269,875 273,932 (1) The final 2021 LTIP, 2022 LTIP and 2023 LTIP awards will be settled 100 percent in shares, with an automatic sell-to-cover in place for employees who are subject to withholding taxes. (2) This includes 1,200 shares held by spouse. — Note 11 Full time employees During each of 2024 and 2023, the Company employed on average 18 and 19 employees, respectively. At ABB, we believe that a culture of diversity, inclusion and equal opportunity is critical to our business success and makes us stronger. ABB has non-discriminatory pay policies which play an important part in minimizing any pay disparities based on gender. — Note 12 Subsequent events Subsequent to December 31, 2024, and up to February 18, 2025, the Company purchased, under the share buyback program, an additional 2 million shares, for approximately CHF 125 million. Any further purchases up to February 26, 2025, are not considered significant for the Company. FINANCIAL REPORT 2024 141 — PROPOSED APPROPRIATION OF AVAILABLE EARNINGS Proposed appropriation of available earnings (CHF in thousands) 2024 2023 Net income/(loss) for the year 2,433,706 (85,708) Carried forward from previous year 2,531,256 6,448,125 Cancellation of shares (730,422) (2,380,048) Available earnings to the Annual General Meeting 4,234,540 3,982,369 Gross dividend of CHF 0.87 per share paid directly by the Company (1) (1,451,113) Gross dividend of CHF 0.90 per share on total number of registered shares (1) (1,674,553) Balance to be carried forward 2,559,987 2,531,256 (1) No dividend will be paid on treasury shares held by ABB Ltd. Shareholders who are resident in Sweden participating in the established dividend access facility will receive an amount in Swedish kronor from ABB Norden Holding AB which corresponds to the dividend resolved on a registered share of ABB Ltd without deduction of the Swiss withholding tax. This amount however is subject to taxation according to Swedish law. On January 30, 2025, the Company announced that the Board of Directors will recommend for approval at the Annual General Meeting on March 27, 2025, that a dividend of CHF 0.90 per share be distributed out of the available earnings, expected to be paid in April 2025. As the legal retained earnings exceed 20% of the share capital, no further allocation to those reserves is required. 142 Statutory Auditor's Report To the General Meeting of ABB Ltd, Zurich Report on the Audit of the Financial Statements Opinion We have audited the financial statements of ABB Ltd (the Company), which comprise the balance sheet as at December 31, 2024, and the income statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the financial statements (pages 129 to 141) comply with Swiss law and the Company’s articles of incorporation. Basis for Opinion We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH). Our responsibilities under those provisions and standards are further described in the ‘Auditor’s Responsibilities for the Audit of the Financial Statements” section of our report. We are independent of the Company in accordance with the provisions of Swiss law and the requirements of the Swiss audit profession, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. We have determined that there are no key audit matters to communicate in our report. Other Information The Board of Directors is responsible for the other information. The other information comprises the information included in the ABB Annual Reporting Suite (consisting of the Integrated Report, the Financial Report, the Corporate Governance Report, the Compensation Report and the Sustainability Statement), but does not include the consolidated financial statements, the statutory financial statements of the Company, the audited content of the Compensation Report, and our auditor's reports thereon. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. 143 In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Board of Directors’ Responsibilities for the Financial Statements The Board of Directors is responsible for the preparation of the financial statements in accordance with the provisions of Swiss law and the Company’s articles of incorporation, and for such internal control as the Board of Directors determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Board of Directors is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law and SA-CH will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with Swiss law and SA-CH, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: — Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. — Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made. 144 145 TABLE OF CONTENTS — SUSTAINABILITY AT ABB 2 Approach to reporting 4 Governance of sustainability at ABB 12 Stakeholder engagement 16 Double materiality assessment 19 Sustainability-related policies 01 ENVIRONMENTAL INFORMATION 24 Protecting the climate 39 Committing to circularity 43 Water management at ABB 45 Keeping pollution in check 46 EU Taxonomy: Disclosures for financial year 2024 02 SOCIAL INFORMATION 57 Responsibility for our employees 68 Social protection in the value chain 73 Protecting vulnerable communities 76 Protecting consumers 03 GOVERNANCE INFORMATION 79 Good business conduct 04 APPENDICES 91 EU Taxonomy: 2024 Tables 102 Swiss Code of Obligations content index 104 ESRS Content Index, including GRI and ISSB interoperability 118 List of datapoints in cross-cutting and topical standards that derive from other EU legislation 122 GRI content index 123 SASB - Electrical & Electronic Equipment — 125 Assurance Opinion 129 Definitions 2 ABB SUSTAINABILITY STATEMENT 2024 — SUSTAINABILITY AT ABB This Sustainability Statement was compiled as of February 26, 2025. We prepared it in accordance with the provisions of the Swiss Code of Obligations (Art. 964b ss.) and related ordinances, and the requirements set out in the EU Non-Financial Reporting Directive (NFRD, Directive 2014/95 EU). The Sustainability Statement includes the disclosures in accordance with the EU Taxonomy Regulation (EU 2020/852) and the supplementary delegated acts. For the first time, the Sustainability Statement is also prepared with reference to the European Sustainability Reporting Standards (ESRS), in preparation for the mandatory reporting under Corporate Sustainability Reporting Directive (CSRD) starting from financial year 2025. — Approach to reporting BP-1: GENERAL BASIS FOR PREPARATION OF THE SUSTAINABILITY STATEMENT CONSOLIDATED REPORTING This Sustainability Statement was prepared for the reporting period January 1 to December 31, 2024. The Statement covers ABB Ltd. and its consolidated subsidiaries worldwide (for a list of significant subsidiaries please see the Appendix to the ABB Corporate Governance Report 2024). Newly acquired businesses as well as businesses that are divested are typically reflected in annual sustainability reporting in line with the financial reporting. For a list of acquisitions and divestments in 2024, please refer to the ABB Integrated Report 2024. The scope of consolidation in this Sustainability Statement is the same as for the annual audited Consolidated Financial Statement (please refer to section “Note 2 – Significant accounting policies” of our Consolidated Financial Statement for further details on the scope of financial consolidation, e.g., investments in joint ventures and affiliated companies). This Sustainability Statement, together with the Financial Report, constitutes the Management Report as required by the CSRD. The report also includes our upstream and downstream value chains, in reference to ESRS and wherever required by the ESRS, unless otherwise stated. No information was omitted to protect intellectual property, know-how or the results of innovation. No disclosure exemptions for impending developments or matters in the course of negotiation, as provided for in articles 19a(3) and 29a(3) of Directive 2013/34/EU, were applied. In the ESRS index table, we have listed disclosures on which we have reported to date. ABB SUSTAINABILITY STATEMENT 2024 3 UNITS OF MEASURE Greenhouse gas (GHG) emissions are presented throughout the statement in metric kilotons (kt) carbon dioxide equivalents (CO₂e) or metric megatons (mt), where 1 metric kiloton CO₂e equals 1000 metric tons CO₂e and 1 metric megaton CO₂e equals 1000 metric kilotons CO₂e. Energy consumption is presented throughout the statement in gigawatt hours (GWh), where 1 GWh equals 1000 megawatt hours (MWh). Waste is presented in metric tons (t) and metric kilotons (kt). Materials used are presented in metric kilotons (kt). — Other reporting principles BP-2: DISCLOSURES IN RELATION TO SPECIFIC CIRCUMSTANCES TIME HORIZONS In this statement, we comply with the medium- or long-term time horizons defined by ESRS 1 section 6.4 of short-, medium- and long-term for reporting purposes. VALUE CHAIN ESTIMATION We work with primary data as much as possible. Estimations based on indirect sources are used, e.g., to calculate scope 3 GHG emissions and avoided emissions datapoints. For further details of the basis for preparation and the methodology used in determining these metrics, please refer to “Greenhouse gas emissions” in the chapter “Protecting the climate”. Currently, we have obtained only very limited primary data or direct information from third-party suppliers and partners to include in our emissions calculations. However, we are committed to improving the collection and quality of primary data or information from third parties and are actively preparing the next steps to achieve this. The shift toward a scope 3 assessment increasingly based on primary data will be a gradual process and will be applied where reasonable, resulting in a hybrid approach based on a mix of primary and estimated data. SOURCES OF ESTIMATION AND OUTCOME UNCERTAINTY There is a high level of measurement uncertainty in this Sustainability Statement in the areas of scope 3 GHG emissions and in avoided emissions. For further details, please refer to the section “Value chain estimation” above and to the section “Greenhouse gas emissions”. CHANGES COMPARED TO PREVIOUS SUSTAINABILITY REPORTING This is the first Sustainability Statement of ABB with reference to the ESRS. In previous years, our main reporting framework was the Sustainability Reporting Standards of the Global Reporting Initiative (GRI). Wherever possible, comparable information for the previous year is provided. As part of the ESRS implementation, in 2024, we conducted a Double Materiality Assessment (DMA) and re-evaluated material topics in alignment with the ESRS. REPORTING ERRORS IN PRIOR PERIODS Certain figures that have been reported in the Sustainability Report 2023 have been reclassified or adjusted in the Sustainability Statement 2024 to conform to the current year’s presentation or due to refined calculation methods. 4 ABB SUSTAINABILITY STATEMENT 2024 USE OF OTHER FRAMEWORKS In addition to the regulatory requirements listed above, this Sustainability Statement was also prepared in reference to the GRI Standards, the IFRS Sustainability Disclosure Standards (also known as ISSB Standards) and in accordance with the Sustainability Accounting Standards Board (SASB). Information previously included in the Task Force for Climate-related Financial Disclosures (TCFD) section, is now covered by the Swiss Ordinance on Climate Disclosures as presented in the relevant ESRS sections. An index table at the end of this Sustainability Statement maps our ESRS disclosures to relevant indicators of GRI and ISSB Standards. This voluntary interoperability table is complemented by additional tables for the Sustainability Accounting Standards Board. INCORPORATION BY REFERENCE Wherever we incorporate information by reference (to other parts of the Management Report), this is clearly indicated. INDEPENDENT ASSURANCE KPMG AG has been engaged by ABB to provide independent assurance for selected 2024 sustainability information disclosed in the Sustainability Statement, including reported progress for 2024 against certain sustainability targets, our compliance with the provisions of the Swiss Code of Obligations (Art. 964b ss.) and the Swiss Ordinance on Climate Disclosures, the process carried out by the management for the DMA and its alignment with ESRS, and the EU Taxonomy disclosures alignment with the EU Taxonomy Regulation. The relevant content subject to limited assurance has been marked as ‘ (assured) ’ throughout the statement. KPMG AG’s full Assurance Statement, including opinion and basis of opinion, is available in the “Assurance Opinion” section in this statement. KPMG AG’s assurance did not extend to comparative periods within the 2024 Sustainability Statement. — Governance of sustainability at ABB GOV-1: ROLE OF ADMINISTRATIVE, MANAGEMENT AND SUPERVISORY BODIES Sustainability at ABB is governed in the following hierarchy: ABB’s Board of Directors (the Board) reviews and approves our Sustainability Agenda and related targets. Our Sustainability Agenda reflects the value we create for our stakeholders and considers insights of the DMA, which takes into account impacts, risks and opportunities (IROs) as identified for ABB. Board committees have specific roles in relation to sustainability: The Governance and Nomination Committee (GNC) is responsible for overseeing ABB’s Sustainability Agenda. The GNC reviews and proposes to the Board the company’s Sustainability Agenda and its targets and monitors target progress and achievements. The Finance, Audit and Compliance Committee (FACC) oversees the integrity of ABB’s sustainability- related reporting, including its reporting processes, systems of internal controls as well as data processing. The Compensation Committee (CC) ensures that our executive compensation policies are appropriately aligned with the Sustainability Agenda. Ultimate responsibility for the company’s Sustainability Agenda, its sustainability targets and its annual Sustainability Statement lies with the entire Board of Directors. In 2024, topics related to the Sustainability Agenda were discussed in every board meeting. ABB SUSTAINABILITY STATEMENT 2024 5 The ABB Group Executive Committee (the EC) validates the Sustainability Agenda and its implementation. It is responsible for reviewing sustainability targets in line with our performance management approach and our operating model, as well as for ensuring that a sustainability culture is embedded in our business decision- making. In every EC meeting held in 2024, topics related to the Sustainability Agenda were discussed. The Chief Communications and Sustainability Officer, who is a member of the EC, holds functional responsibility for sustainability and reports together with the Group Head of Sustainability to the GNC on topics and progress related to the Sustainability Agenda. The Sustainability Council is the highest operational decision-making body for sustainability. It drives the development of the Sustainability Agenda based on evolving stakeholder requirements, oversees implementation and monitors progress towards targets. In line with our operating model – the ABB Way –, all business areas are represented in the Sustainability Council by their strategy heads as well as their sustainability leads. Additional members of the Sustainability Council include representatives of our corporate functions sustainability, strategy, sustainability reporting, as well as legal and integrity. Topic-specific Workstreams establish targets and roadmaps across business areas and determine the governance for the respective sustainability topics. Additionally, they monitor emerging requirements and share best practices across business areas. The Workstreams include subject-matter experts from our business areas and divisions as well as members of the Corporate Sustainability team. They regularly report to the Sustainability Council on their progress and receive support from the Council where needed. In line with the ABB Way and our decentralized operating model, our four business areas and their divisions are ultimately accountable for putting action plans in place and ensuring that appropriate resources are available to implement these plans and deliver on our targets. The Corporate Sustainability team provides thought leadership and governance, sets targets and drives continuous improvement. Finally, our Sustainability Reporting team , being part of ABB’s Finance organization, is responsible for the preparation of our annual Sustainability Statement. There is a dedicated procedure for the management of IROs applicable for these bodies in the form of the DMA Procedure adopted in 2024. Entity-level controls for this Procedure will be in place in the course of the financial year 2025. BOARD AND EXECUTIVE COMMITTEE COMPOSITION In proposing individuals for election, the Board seeks to align its composition, skills and experience with the company’s strategic needs. The Board strives for diversity in all aspects including gender, nationalities, ethnicity and age. In addition, the tenure of the members of the Board should be well-balanced. In 2024, the Board was composed of 70 percent male directors, while 30 percent of the positions were held by female directors. Furthermore, 60 percent of the Board members are in the age range of 50 to 59 years and 40 percent are between 60 and 69 years. All 10 members of our Board are independent and non-executive directors. We did not have employee representatives on our Board, as per Swiss corporate law, the Board of Directors is elected by the shareholders only and representation of employees is not foreseen. 6 ABB SUSTAINABILITY STATEMENT 2024 Further, the composition of the Board in context of experience was as follows: Board Experience Corporate Officer Experience Other Business Experience Global Experience Country of Origin / Nationality Board Member ABB Board Tenure (years) Other Public Board Experience CEO CFO Operations Risk Management Sustainability Digital / Technology Peter R. Voser 10 ● ● ● ● ● ● ● ● CH David Constable 10 ● ● ● ● ● ● CA, US Frederico Fleury Curado 9 ● ● ● ● ● ● ● BR, PT Lars Förberg 8 ● ● ● ● ● SE, CH Johan Forssell 1 ● ● ● ● ● ● ● SE Denise C. Johnson 2 ● ● ● ● ● ● US Jennifer Xin ‑ Zhe Li 7 ● ● ● ● ● ● ● CN, CA Geraldine Matchett 7 ● ● ● ● ● ● CH, UK, FR David Meline 9 ● ● ● ● ● ● US, CH Mats Rahmström 1 ● ● ● ● ● ● ● SE For each Board member’s biography, see Corporate Governance Report 2024. In line with the Board’s leading example, ABB strives to have an equally diverse Executive Committee in all aspects. When appointing executives, the Board pays specific attention to relevant subject matter or business sector and products experience, as applicable, for each member. In our EC, 78 percent of the positions were held by male executives and 22 percent by female executives in 2024. The age distribution showed 11 percent, equaling one of the members, being in the range of 40 to 49 years old, and 78 percent of EC members were between 50 to 59 years old. 11 percent of the members are in the range of 60 or above. All 9 EC members were active as executives and employed by ABB Ltd. ABB SUSTAINABILITY STATEMENT 2024 7 The following table gives a detailed overview of the experience of our EC members: Name Role Business Experience Global Experience Sustainability Experience Country of Origin / Nationality Electrification (1) Motion (2) Process Automation (3) Robotics & Discrete Automation (4) Corporate Officer Experience Morten Wierod Chief Executive Officer ● ● ● ● ● NO Timo Ihamuotila Chief Financial Officer ● ● ● FI Carolina Granat Chief Human Resources Officer ● ● ● SE Mathias Gaertner General Counsel and Company Secretary ● ● ● DE Karin Lepasoon Chief Communications and Sustainability Officer ● ● ● SE Giampiero Frisio Business Area President Electrification ● ● ● ● IT Brandon Spencer Business Area President Motion ● ● ● ● US Peter Terwiesch Business Area President Process Automation ● ● ● ● DE, CH Sami Atiya Business Area President Robotics & Discrete Automation ● ● ● ● DE 1 Covering renewable power solutions, modular substation packages, switchboards and panelboards, switchgears, UPS solutions, breakers, control products, wiring accessories, enclosures and cabling systems, building automation, and similar products as well as related services. 2 Covering drives, motors, generators, traction converters, and similar products as well as related services. 3 Covering control technologies, industrial software, advanced analytics, sensing and measurement technology, marine propulsion systems, and similar products as well as related services. 4 Covering robots, mapping and navigation solutions, automation solutions, industrial PCs, transport systems, machine vision, and similar products as well as related services. For each EC member’s biography, see Corporate Governance Report 2024. SUSTAINABILITY EXPERIENCE AMONG ABB LEADERSHIP Our Board of Directors annually evaluates the necessary competencies for its members. In 2024, the assessment of available sustainability competencies was refined to align with CSRD. The updated list of essential sustainability competencies encompasses our material topics: • Environmental: Climate change, pollution, water and marine resources, resource use and circular economy. • Social: Own workforce, workers in the value chain, affected communities, consumers and end-users. • Governance: Business conduct. We have expanded our annual Board and EC questionnaire accordingly in order to gain a better overview of sustainability-related experience in these bodies. Thereby we aim to strengthen our reporting basis and sharpen the sustainability focus of our education programs for Board and EC. Sustainability is also considered in the Board’s annual assessment, which includes evaluating whether the right level of experience is available and whether the Board is sufficiently informed about sustainability issues and its responsibilities. Both aspects were confirmed by the Board. Both our Board and our Executive Committee, as collective bodies, possess the necessary experience to cover all topics identified as material in our DMA including IROs. The Governance and Nomination Committee and the Board ensure that this experience is considered when proposing new Board candidates or appointing new EC members. 8 ABB SUSTAINABILITY STATEMENT 2024 — Sustainability as a management topic GOV-2: INFORMATION REGARDING SUSTAINABILITY MATTERS For sustainability matters addressed by the Board of Directors and the Executive Committee in general, including frequency of discussions, please see above under “Governance of sustainability at ABB”. For more details of these bodies’ roles and involvement in overseeing potential IROs, please see the discussion of our DMA in section “Double Materiality Assessment” below. The discussion of IROs in these bodies includes matters of due diligence and the results and effectiveness of policies, actions, metrics and targets adopted to address them. Our sustainability-related IROs are reflected in our strategic approach, the Sustainability Agenda. In the course of its sessions during the reporting year, the EC evaluated the Sustainability Agenda and the progress in its implementation, including several topics of strategic relevance. For example, the EC approved the integration of sustainability metrics into the long-term performance planning, specifically scope 1, 2 and 3 emissions, circularity, zero waste to landfill and senior female leadership. The EC reviewed the proposed five-year glidepath for some of these metrics. It also reviewed the status of CSRD reporting and discussed the need for sustainability data automation. Further topics discussed included the climate transition plan and the 2027 Sustainability Roadmap. In preparation for CSRD reporting and in line with its responsibilities, CSRD was also on the agenda of every FACC meeting in 2024. During the reporting period, the EC discussed all material IROs as they have been identified for the first time in 2024. The Board of Directors deals with IROs regularly as they arise. As those IROs have all been defined in the reporting year, all of them have been addressed accordingly. — Incentives for sustainability GOV-3: SUSTAINABILITY-RELATED PERFORMANCE IN INCENTIVE SCHEMES Building on our mindset of continuous improvement, ABB translates its strategic priorities – including financial performance and progress on sustainability – into short- and long-term targets, which are supported by appropriate incentives. A holistic set of key performance indicators (KPIs) enable us to plan, measure, monitor and review progress against these targets. ABB SUSTAINABILITY STATEMENT 2024 9 Baseline (baseline year) 2023 status 2024 status INTEGRITY AND TRANSPARENCY Linking sustainability targets to executives’ variable pay Under the Annual Incentive Plan (AIP), a safety goal was included within the individual measure for some members of ABB’s Executive Committee (EC). The individual measure had a weighting of 20 percent of the executive’s target AIP (2019). Under the AIP, at least two sustainability-related performance goals are included within the individual measure for each member of ABB’s EC. The individual measure has a weighting of 20 percent of the executive’s target AIP. Refer to AIP detailed update below Under the Long-Term Incentive Plan (LTIP), two performance measures with equal weighting of 50 percent were considered, namely average earnings per share and relative total shareholder return. The LTIP was awarded to around 100 executives, including EC members and division presidents. Vesting under the LTIP was subject to the achievement of the plan- specific targets over a period of three years (2019). One of the three performance measures under ABB’s LTIP is based on achievement of a corporate sustainability target and carries a weighting of 20 percent. The LTIP is awarded to around 100 executives, including EC members and division presidents. Vesting under the LTIP is subject to the achievement of the plan- specific targets over a period of three years. Refer to LTIP detailed update below Incentives enable us to maintain a strong link between strategy and compensation. This linkage includes our commitment to sustainability, which is embedded in both the Annual Incentive Plan (AIP) for Executive Committee members and the Long-Term Incentive Plan (LTIP). Under the AIP, in 2024, all members of the EC had three sustainability goals (out of a maximum of three) in the individual measure of their respective plans. The individual measure has a weighting of 20 percent of the executive’s target AIP award. In 2024, all EC members had an environmental goal referring to scope 1 and 2 GHG emissions reduction. In addition, all EC members had a governance goal designed to help deliver ABB’s obligations under the Deferred Prosecution Agreement. Most EC members also had a social goal, which for the CEO and business area presidents related to safety, and for most corporate officers was an increase in the proportion of women in senior management roles (female leaders), while the CFO had a governance goal (related to internal controls). Performance Share Units (PSU) under our LTIP are granted to around 100 executives, including EC members and division presidents. Vesting of the PSU grants is subject to the achievement of the plan’s specific targets over a period of three years. One of the three performance measures under the LTIP is based on the achievement of a corporate sustainability target and carries a weighting of 20 percent. For the 2024 LTIP, the sustainability performance measure was ABB scope 1 and 2 GHG emissions reduction at the end of the three-year performance period (2024–2026), compared to the 2019 baseline. To safeguard adherence to our Code of Conduct and compliance policies, the incentives offered to our Executive Committee members are subject to malus and claw-back provisions. For more details, please refer to our Compensation Report 2024. 10 ABB SUSTAINABILITY STATEMENT 2024 — Due diligence statement GOV-4: STATEMENT ON DUE DILIGENCE Due diligence is a vital, cross-cutting process that ensures we identify and manage key impacts across our operations and value chain. The table below outlines the interdependence of these impacts, showing how due diligence is embedded across various topics deemed as material under CSRD, to facilitate informed decision-making. By mapping and highlighting these linkages, we mark the first step toward alignment with the upcoming Corporate Sustainability Due Diligence Directive (CSDDD). Due diligence topics Environment People Embedding due diligence in governance, strategy and business model(s) Sustainability is embedded in all governance bodies and defined as a key management topic. More information on this can be found in the section “Sustainability as a management topic“ (p. 8). We integrate sustainability-related performance in our AIP and LTIP. For more information on this topic, please refer to section “Incentives for sustainability” (p. 8). An elaboration on how the identified material IROs interact with our strategy and business model can be found in section “Material impacts, risks, and opportunities” (p. 14) and in the respective IRO descriptions in the topical chapters (“Material impacts, risks and opportunities resulting from climate change”, p. 26; “Strategic approach to circularity”, p. 39; “Water as a material topic at ABB”, p. 43; “Double Materiality Assessment for pollution”, p. 45; “Identification of material IROs”, p. 57; “Involvement of value chain workers”, p. 68; “Impacts and opportunities”, p. 73; “Management of consumer-related risks”, p. 76; “Materiality”, p. 79). Engaging with affected stakeholders Our administrative, management and supervisory bodies are informed about sustainability matters regularly by the respective individuals and committees. We elaborate further on this topic in section “Sustainability as a management topic“ (p. 8). At ABB, we value the interests and views of our stakeholders and take them into account for the further development of our strategy and business model. An explanation on how we do this can be found in the section “Stakeholder engagement” (p. 12). We closely involved our stakeholders in the DMA to identify IROs regarding our overall business activities, but also in regard to our stakeholder engagement. For more information, please refer to section “Double Materiality Assessment”, p. 16. To provide an understanding of the policies in place to prevent, mitigate and remediate actual and potential adverse impacts, we set out the overarching policies in section “Sustainability-related policies” (p. 19). Furthermore, specific policies will be explained in the topical chapters (“Climate change-related policies”, p. 29; “Policy commitments to circular resource management”, p. 40; “Water-related policies”, p. 43). To provide an understanding of the policies in place to prevent, mitigate and remediate actual and potential adverse impacts, we set out the overarching policies in section “Sustainability-related policies” (p. 19). Furthermore, specific policies will be explained in the topical chapters (“Employee-related policies”, p. 58; “Supplier-related policies”, p. 69; “Community-related policies”, p. 74; “Consumer-related policies”, p. 76; “Business conduct-related policies”, p. 81). In the environmental chapters, there are no IRO-1 disclosures related to understanding how engagement with specific stakeholder groups on specific (potential) adverse impacts are performed in scope for the present report. Information relevant to understanding how engagement with specific stakeholder groups on specific (potential) adverse impacts is performed can be found in section “Employee involvement in decision-making processes” (p. 60), “Engaging with value chain workers” (p. 69), “Management of supplier relationships” (p. 84). In the chapters on affected communities and our consumer and end-users, there are no disclosures related to stakeholder engagement in scope for the present report. Identifying and assessing negative impacts A description of our processes to identify and assess material adverse environmental impacts can be found in the section “Material impacts, risks and opportunities resulting from climate change” (p. 26), “Strategic approach to circularity“ (p. 39) and “Water as a material topic at ABB” (p. 43). A description of our processes to identify and assess material adverse impacts on people can be found in the section “Channels available to raise concerns” (p. 62), “Employee-related action” / “Human rights- related action” (p. 63), “Engaging with value chain workers” (p. 69) and in “Materiality” (p. 79). A description of material adverse impacts and how they interact with our strategy and business model can be found in section “Material impacts, risks, and opportunities” (p. 14) and in the respective IRO descriptions in the topical chapters (“Material impacts, risks and opportunities resulting from climate change”, p. 26; “Strategic approach to circularity “ (p. 39); “Water as a material topic at ABB” (p. 43); “Identification of material IROs”, p. 57; “Involvement of value chain workers”, p. 68; “Impacts and opportunities”, p. 73; “Management of consumer-related risks”, p. 76; “Materiality”, p. 79). ABB SUSTAINABILITY STATEMENT 2024 11 Due diligence topics Environment People Taking action We elaborate on some of our actions to combat climate change in section “Management of climate change” (p. 32). For the other environmental chapters, there are no disclosures related to actions in scope for the present report. We reflect the range of actions, through which impacts are addressed in section “Employee- related action” (p. 62). For the other chapters on people, there are no disclosures related to actions in scope for the present report. Tracking effectiveness We track the effectiveness of our environmental measures and disclose our targets and metrics in the respective topical chapters (“Climate change-related targets”, p. 30, “Facts & figures Energy”, p. 33; “Circularity-related targets”, p. 41, “Facts & figures Waste management”, p. 41; “Facts & figures Water” p. 44). We track the effectiveness of our social measures related to our own workforce in section “Employee-related action” / “Tracking the effectiveness of our approach” (p. 64) and disclose our metrics in “Facts & figures Own employees” (p. 65). — Risks and controls in sustainability reporting GOV-5: INTERNAL CONTROLS OVER SUSTAINABILITY REPORTING As defined in the ABB Ltd Board Governance Rules, the Board of Directors is responsible for establishing an internal control system to monitor and address financial operations and sustainability reporting processes. The Board has delegated roles and responsibilities for controls to the FACC. The FACC oversees the integrity of our reporting processes and systems of internal controls, including its internal and external assurance processes as well as manual and automated data processing. We have adopted the integrated framework designed by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) for our internal controls over reporting. In 2024, we updated our “Internal control over reporting” policy to specify that defined internal control standards, requirements, certifications, governance, roles and responsibilities apply to all reporting processes of the Group, including sustainability reporting. The scope of the environmental, social and governance topics disclosed in the Sustainability Statement has been defined by means of a DMA (see section “Double Materiality Assessment” below). We conducted an Internal Controls over Sustainability Reporting (ICSR) risk assessment to determine the risk of material misstatements considering the risk profile of the datapoints and the related reporting process. Depending on the assessed risk level, we determined the required mitigation efforts. The risk assessment considers to what extent inherent risks are likely to impact sustainability reporting processes. Based on the likelihood and magnitude, process level controls are defined to address the risk points identified. We executed an internal controls self-assessment program on a quarterly and yearly basis to assess control design effectiveness and control performance. This program is overseen and monitored by the Corporate Assurance Risk & Internal Controls team. Since 2024, this program also covers key controls over sustainability reporting. We have established and implemented an internal assurance certification process in line with the Assurance and Disclosure Governance policy. Starting from 2024, the scope of assurance certification was extended to sustainability reporting. All required entities at different levels in the Group sign off on the fair representation of financial and sustainability information. We extended the process to monitor internal control assessment results to sustainability reporting, to ensure that potential control weaknesses and deficiencies are addressed and corrected in a timely manner. The disclosure process is overseen by the relevant committees. The results of internal control assessments are regularly reviewed by the FACC. 12 ABB SUSTAINABILITY STATEMENT 2024 The above-described approach applies to disclosures related to regulatory compliance as well as committed targets as published in this Sustainability Statement. — Stakeholder engagement SBM-2: INTERESTS AND VIEWS OF STAKEHOLDERS At ABB, we engage with our most relevant stakeholder groups, including collaborative partnerships, customers, employees, governments and civil society, the investment community, and suppliers. We engage with governments and the local communities in which our products are manufactured and used, with the aim of fostering technology adoption, sound regulatory frameworks, job creation and economic growth. We also engage with stakeholders along the value chain to drive sustainability topics such as decarbonization and respect of human rights. The perspectives of our stakeholder groups are reflected in our policies and procedures. Our different stakeholder groups and how we interact with them is shown in the table below. Stakeholder group Approach to engagement Collaborative partners We collaborate with companies and academic institutions on a wide range of social, environmental, and technological activities and topics. These partnerships serve to foster knowledge exchange, enabling us to stay abreast of latest developments, contribute to innovation, provide access to talent, expand markets and address complex challenges in a more effective manner. The engagement is done both centrally and at divisional level. How we engage: • Collaborations with academic institutions, to drive innovation, including themes related to sustainability. • Participation in industry groups, to drive innovation and advance policy. • Membership in sustainability-related international organizations such as Global Business Initiative on Human Rights (GBI), UN Global Compact, World Business Council for Sustainable Development (WBCSD) and the Responsible Minerals Initiative (RMI). We also collaborate with organizations such as the International Committee of the Red Cross (ICRC), the Science-Based Targets initiative (SBTi) and with ICoCA, the Responsible Security Association. • Technology and innovation partnerships with companies and startups to lay the basis for potential future direct investments or acquisitions. • Various organizations promoting Diversity, Equity and Inclusion. • Strategic corporate partnerships that enable the creation of local employment opportunities, infrastructure development and local economic value. Customers Meeting customer needs and expectations is essential to our success. The engagement with customers on sustainability topics occurs primarily in the divisions and includes sustainability-focused meetings and projects. How we engage: • Customer requests and collaborations around ABB’s product offerings, such as an end-to-end approach and a one-stop-shop for building automation and smart energy management solutions. • Our Key Account Managers and our customer service organizations address sustainability questions with customers, including through customer trade shows. • Sustainability partnerships such as enabling take-back schemes. • Assessing the impact of our products on customers’ sustainability performance (carbon footprint, circularity). ABB SUSTAINABILITY STATEMENT 2024 13 Stakeholder group Approach to engagement Employees Employees are vital for achieving our goals and staying competitive. In an ongoing dialogue, we aim to bring employee perspectives into our policies and procedures. Employee engagement takes place at different levels across the organization. How we engage: • Annual Employee Engagement Survey, followed up with local workshops to discuss the results and define actions. • Targeted pulse surveys on specific topics. • Annual performance reviews. • Negotiating with collective bargaining associations. • Network of Employee Resource Groups promoting Diversity, Equity & Inclusion in the workplace. Feedback from these groups are collected through regular meetings and help inform policy and guidelines. • Learning and development opportunities. • Engagement and training on business conduct. Governments and civil society We engage with governmental, regulatory, political and economic stakeholders, local communities, the media, non-governmental organizations (NGOs) etc. at global, national and local levels. These key stakeholders provide the political and regulatory support and public trust necessary to achieve sustainable growth. Engagement with government and civil society takes place both centrally and at a divisional level. How we engage: • Direct dialogue with community representatives, where possible, to understand local and national needs both related to our own operations and to our value chain. • Donations and volunteering. • Meetings with regulators to understand their priorities and share our views on policy issues and advocate the deployment of low-carbon technology and energy- efficient solutions. • Participation in national and international initiatives to address global issues such as Diversity, Equity and Inclusion, climate change and other sustainability topics. Investment community The investment community enables ABB’s access to financial capital and includes such market participants as shareholders, debtholders, financial analysts, rating agencies and proxy advisors. Investor relations are managed on a corporate level through the Investor Relations team. How we engage: • Annual General Meeting. • Capital markets days, including a specific section on sustainability. • Group reporting. • Investor relations website linking to our sustainability page. • Investor roadshows and conferences including sustainability themes. • One-on-one meetings, including requests from investors on specific meetings to understand sustainability performance. • Press releases. • Quarterly analyst and investor webcasts, including a specific section on sustainability. Suppliers Our suppliers have a significant impact on our operations and success as well as our ability to meet our sustainability targets. Working with suppliers allows us to identify and mitigate risks in the supply chain. While day-to-day engagement with suppliers is primarily done in the divisions, several of the engagement programs and supplier- related policies are centrally coordinated through topic-specific workstreams. How we engage: • Co-development of initiatives and early engagement during new product development. • Collaboration to drive GHG emissions reduction. • Monitoring and active engagement through our Sustainable Supply Base Management program, our Conflict Minerals program and Material Compliance program. • Partnerships to access more sustainable materials. • On-site evaluations and audits including interviews with the supplier’s employees. • Town hall and supplier day events. 14 ABB SUSTAINABILITY STATEMENT 2024 We engage with our stakeholders for specific strategic and reporting purposes to gain insights into how they perceive value and what matters to them most in terms of economic, environmental and social issues. This informs our strategic decision-making and the way we manage risks and opportunities. The stakeholder input shapes the actions we take. By engaging with our various stakeholders, we identify and anticipate emerging trends, shifting customer needs and changing market expectations. Internal and external stakeholder input is considered, both for informing the sustainability-related work in the divisions as well as for the further development of our Sustainability Agenda. Internal and external stakeholder surveys and interviews serve as key input into our DMA process. — Material impacts, risks, and opportunities SBM-3: MATERIAL IROs AND INTERACTION WITH STRATEGY AND BUSINESS MODEL The following is a summary of the material IROs, which were included in the IRO inventory for the purpose of the DMA performed in 2024. Further details, including a disclosure of the material IROs and their interaction with strategy and business model, is found in the respective topical standard chapters of this Sustainability Statement. E1: CLIMATE CHANGE ABB’s value chain, from raw material extraction to end-of-life, impacts climate change. Manufacturing, assembly and logistics from our own operations contribute directly to greenhouse gas emissions. We mitigate this through energy- efficient processes, use of renewable energy, sustainable upstream practices and supplier engagement. At the same time, our technologies enhance customers’ energy efficiency, leading to emissions reductions. Climate change also poses risks to our infrastructure, operations and employee safety, but, acting on climate change provides opportunities. Collaboration with governments and NGOs aids the transition to a low-carbon economy, while innovations in renewable energy and efficiency secure our market leadership, reputation and talent attraction, alongside reducing carbon footprint and costs through diverse energy sourcing. E2: POLLUTION ABB’s value chain and operations can have a negative effect on the environment through pollution. To address these challenges, we promote sustainable practices, such as supplier environmental criteria and circular economy principles, leading to the reduction and elimination of pollution. There are risks associated with pollution. Stricter regulations, like the potential European ban on per- and polyfluoroalkyl substances (PFAS), can disrupt sourcing and materials. Compliance with new standards would demand significant adjustments. We pursue a proactive approach to sustainability and resource management to adapt to and mitigate these risks. E3: WATER AND MARINE RESOURCES Manufacturing processes, particularly those requiring substantial water use, strain freshwater resources and can affect local ecosystems. However, we commit to optimize water usage wherever possible. Following the DMA, we concluded that all aspects relating to marine resources are not material to ABB. ABB SUSTAINABILITY STATEMENT 2024 15 E5: CIRCULAR ECONOMY AND RESOURCE USE ABB’s business practices have environmental implications through resource use and waste generation. The material consumption for manufacturing may deplete global resources and increase waste. However, our commitment to a circular economy, for instance through recyclable product design and energy efficiency, aims to mitigate these impacts. We can face risks, like product obsolescence, slow market entry and resource scarcity, but we can also pursue opportunities, through setting leading practices in circularity. Innovations like robotics-as-a-service and circuit board take-back systems open new business avenues. Partnerships and startup investments improve market presence and cut raw material costs. Developing innovative, energy-efficient and recyclable products is a major ambition for us, enhancing revenue and supply chain resilience. S1: OWN WORKFORCE At ABB, we are positively impacting our employees through a strong diversity program, learning and development opportunities, and rigorous safety training. Our diversity initiatives ensure equal opportunities for our employees. We prioritize robust health and safety measures to minimize risks. Despite this, challenges like workload stress, labor rights issues and safety incidents can still occur. Inadequate training for technologies such as robotics may also lead to job losses. Balancing positive programs with proactive measures for these concerns is crucial for the workforce’s wellbeing and operational success. Besides the positive impacts on employees through our efforts, they also contribute to our business opportunities and success. For example, our Greener in Motion program boosts employee engagement and retention. Equality programs like Women in Motion and LeadHer enhance income and lower recruitment expenses by ensuring fair treatment and opportunities. Flexible work models attract and retain talent, promoting business growth and innovation. Not acting on these topics would adversely lead to risks, through talent retention, reputational damage, or even sanctions and fines. S2: WORKERS IN THE VALUE CHAIN In our value chain, there is a potential risk of negative impacts on individuals involved in labor, e.g., through health and safety risks in mining. Chemicals and heavy machinery usage in upstream processes can also pose health risks to workers. Our Sustainable Supply Base Management Program, audits, and supplier quality audits, and active membership of the Responsible Minerals Initiative, alongside our Business Ethics Helpline and training, demonstrate our commitment to the safety and wellbeing of all individuals in our value chain. S3: AFFECTED COMMUNITIES ABB’s activities impact communities along its value chain. Negative impacts can arise through pollution or noise from operations or transportation. Positive impacts include creating local employment opportunities, infrastructure development and economic value. Forming partnerships with aligned companies and stakeholders enables us to grow as a company. S4: CONSUMERS AND END-USERS At ABB, we prioritize our customers’ and end-users’ privacy, fostering trust and security by protecting personal information and respecting individual rights with a transparent, ethical approach to data handling. Access to quality information for our customers empowers informed decisions, promoting transparency and confidence in our products. While safety incidents can occur with product misuse, especially among vulnerable users, our strong safety measures and clear usage instructions aim to mitigate risks, ensuring the wellbeing of all our consumers and end-users. 16 ABB SUSTAINABILITY STATEMENT 2024 G1: BUSINESS CONDUCT The impact of ABB’s business conduct is vital for our social license to operate and sustainable growth. Ethical business conduct, transparency, prevention of corruption and bribery, a strong whistleblower system, and regulatory compliance are key. Lapses can lead to legal risks, financial penalties and brand damage. Engagement and training on business conduct helps attract quality employees and enhance our culture. Integrity lapses, on the other hand, can cause financial and reputational harm. Our transparency and ethics build trust, combat corruption and limit financial risks. For the current and anticipated effects of our IROs on our business model, value chain, strategy and decision-making, please see the respective IRO descriptions in the topical chapters. The material impacts we are involved with relate to both our activities (own operations) and our business relationships (upstream and/or downstream value chains), depending on the concrete IRO in question. The nature of these relationships is disclosed in (a) the summary of IROs above and (b) in the respective IRO descriptions in the topical chapters. — Double Materiality Assessment (assured) IRO-1: DESCRIPTION OF PROCESS TO IDENTIFY AND ASSESS MATERIAL IROs In 2024, ABB performed a new DMA on Group level, including all subsidiaries, aligned with the ESRS. The process was changed for the fiscal year 2024 to reflect the DMA methodology aligned with ESRS requirements. We focused on both our own operations and our value chain. The process was structured into four phases, guided by due diligence activities and supported by key data sources at each phase, as outlined below: The understanding phase considered the previously conducted Human Rights Risk Assessment (HRRA) to map the value chain and incorporated the results of the 2023 stakeholder engagement. To understand the value chain, the previously conducted HRRA was taken as a basis. The activities considered as upstream and downstream value chain were Research & Development/testing/support functions, components manufacturing and assembly, transport and logistics, bidding, sales and distribution, projects and services, raw material extraction and processing, use by ABB customers and end users, and end of life. Material topics from the previous materiality assessment were mapped to ESRS sub-topics and helped in the identification phase of the new DMA. During the identification phase , potential IROs were identified through stakeholder input, internal analyses, interviews with representatives from our business areas and industry knowledge, to focus on specific activities, business relationships, geographies or other factors that give rise to a heightened risk of impacts. Impacts were identified through, for example, industry knowledge, the HRRA and internal environmental research. ABB SUSTAINABILITY STATEMENT 2024 17 ABB’s existing Enterprise Risk Management (ERM) process, which has integrated sustainability risks, identifies risks across all activities and geographies within ABB. Sustainability - related risks were mapped to relevant ESRS topics. The ERM is an overall approach to risk identification and assessment, which considers both internal and external sources of risks. The ERM process is embedded in our ABB Way operating model and encompasses all levels of our organization. The ERM provides our leadership with an overview of the most critical risks. It follows a bottom-up approach as all divisions, business areas and corporate functions are required to identify and assess their most critical risks based on our defined methodology. It starts with the identification of our strategic business objectives. Next, we identify the most critical risks, which could prevent us from achieving these objectives and lead to a potential material financial impact primarily over the short- and medium-term, as well as risks of a long-term nature, e.g., climate risks. We prioritize sustainability-related risks similar to other enterprise risks through our ERM process. We consider the connections between our impacts and dependencies with the risks and opportunities and consider the connection and dependencies between risks and impacts in an integrated way and not differentiating between the two when risks are identified and assessed. This ensures that both an outside-in and inside-out perspective is considered and supports a fuller assessment of the risks. Similarly, opportunities connected to impacts were also considered for the DMA. This involved assessing how the identified opportunities could lead to potential impacts and integrating these considerations into the overall materiality assessment process. Opportunities across business areas were identified using our 2023 Integrated Report and Sustainability Report as well as the internal stakeholder survey. During the assessment phase , negative impacts were assessed based on their relative severity (scale, scope, irremediability) and likelihood, and positive impacts based on their relative scale, scope and likelihood. Impacts were assessed using desktop research and industry knowledge. The assessment of impacts was validated through insights gathered from stakeholder surveys. In line with ESRS we have assessed risks based on the magnitude of their potential financial effect and the likelihood of their occurrence. For the assessment we drew upon the results of ABB's ERM process. Opportunities were evaluated based on their financial impact and likelihood, informed by stakeholder input. In the determination phase , we have adopted thresholds to determine which of the sustainability topics will be covered in our Sustainability Statement.   Different options for the scored IROs aggregated to ESRS subtopics were analyzed, including benchmarking against peers and prior materiality. Based on that assessment, the threshold at the 33.33rd percentile was selected. IROs below this threshold were considered not material. To decide on the most sensible threshold, different options for the cut-offs in the form of percentiles on the scored IROs aggregated to ESRS sub-topics were created, tested, discussed in working sessions and benchmarked. The DMA has been reviewed and approved by the ABB Sustainability Reporting Steering Committee. Impacts and opportunities are shared with the business areas for strategic considerations. The process described here was changed for the fiscal year 2024 to reflect the DMA methodology in line with ESRS requirements.   We have applied certain assumptions in the process outlined above. We have considered the findings from the 2023 materiality assessment and the supporting stakeholder engagement (described in detail in our 2023 Sustainability Report) and concluded they remain valid considering they have been conducted recently and there are no known significant changes. Additionally, the ERM process was deemed appropriate and the Human Rights Risk Assessment mapping across the value chain remains relevant. 18 ABB SUSTAINABILITY STATEMENT 2024 Based on the aggregation results, the following ESRS subtopics were derived as material:   E1: Climate Change 1 Climate change adaptation 2 Climate change mitigation 3 Energy E2: Pollution 4 Pollution of air 5 Pollution of soil 6 Pollution of water E3: Water and marine resources 7 Water E5: Resource Use and Circular Economy 8 Resource outflows related to products and services 9 Resource inflows, including resource use 10 Waste S1: Own Employees 15 Equal treatment and opportunities for all 16 Other work-related rights 17 Working conditions S2: Workers in the Value Chain 18 Equal treatment and opportunities for all 19 Other work-related rights 20 Working conditions S3: Affected Communities 21 Communities’ civil and political rights 22 Communities’ economic, social and cultural rights S4: Consumers and End-Users 23 Information-related impacts for consumers and/or end-users 24 Personal safety of consumers and/or end-users G1: Business Conduct 11 Corporate culture 12 Corruption and bribery 13 Management of relationships with suppliers including payment practices 14 Protection of whistleblowers The following table shows which IROs (identified by number) are located in which part of the value chain (own operations and upstream or downstream value chain) as well as the nature of these IROs (positive or negative impact, risk or opportunity). Material IROs Own operations Upstream value chain Downstream value chain Positive impacts 2, 9, 11, 12, 13, 14, 15, 17, 22 2, 3, 8, 9, 12, 13, 14, 18, 19, 20, 22 2, 3, 8, 9, 10, 12, 13, 14, 18, 19, 20, 22, 23, 24 Negative impacts 2, 3, 4, 5, 6, 7, 9, 12, 13, 15, 17, 21 2, 3, 7, 9, 19, 20, 21, 22 2, 3, 4, 10, 20, 24 Risks 1, 2, 5, 8, 11, 15, 16, 23, 24 1, 5, 8, 9, 24 8, 23, 24 Opportunities 2, 3, 8, 9, 10, 11, 12, 15, 17, 21 2, 9, 10, 20, 21 2, 3, 8, 9, 10, 11, 12, 21 We are still in the process of fully integrating all new material topics into our sustainability approach. The development of concepts and key performance indicators as stipulated by Art. 964b of the Swiss Code of Obligations is an ongoing process. In 2025, we plan to perform an IRO review while future DMA revisions need to be assessed. Topical disclosures required in IRO-1 will be considered in the next reporting cycle. ABB SUSTAINABILITY STATEMENT 2024 19 — Disclosure Requirements used IRO-2: DISCLOSURE REQUIREMENTS COVERED BY SUSTAINABILITY STATEMENT Please see the ESRS Index in the appendix of this report for a full list of all Disclosure Requirements used in this Sustainability Statement. To determine the final scope of datapoints, we used the ESRS dataset (version of December 2023, which was the latest version at the time) and mapped it to material ESRS subtopics. Voluntary datapoints were excluded, and phase-in provisions were applied as outlined in ESRS 1, Appendix C. All datapoints that were connected to the material sub-topics were evaluated individually, resulting in 62 in-scope quantitative datapoints and 220 in-scope qualitative datapoints. We disclose information based on its significance in relation to our IROs and their importance to the needs of stakeholders. — Sustainability- related policies ABB’s Sustainability Agenda is managed on the basis of established policies and procedures, which are continuously adapted to new developments and regulatory requirements. Several of these policies reappear in more than one topical chapter of this Sustainability Statement. To avoid repetition, they are introduced below. ABB WAY The ABB Way is our operating model, a governance framework that is designed to safeguard ABB from financial and reputational harm and to enable us to work closely with our customers and stakeholders. It defines how we operate and create value through our business model, people and culture, brand, and governance. To ensure strong governance, the ABB Way links mandatory documents such as policies and procedures. Depending on who issues them, they are applicable to one or more business areas or divisions. Policies describe what is and what is not allowed. Procedures explain how to implement and comply with the Code of Conduct or a policy. Both policies and procedures are mandatory. SUSTAINABILITY POLICY The Sustainability Policy aims to set out the core sustainability practices that drive the development and implementation of the Sustainability Agenda, ensuring that ABB is enabling a more sustainable and resource-efficient future, hereby meeting evolving stakeholder requirements. The policy is supported by mandatory sustainability procedures and annex documents and provides a model for functional governance and operational deployment of the Sustainability Agenda. The policy is mandatory for the entire ABB Group, including joint ventures, consortia, working partnerships, and third-party service providers under ABB management control. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no third-party standards referred to in this policy. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. It is an internal policy and is accessible to all ABB employees via the internal network. 20 ABB SUSTAINABILITY STATEMENT 2024 CODE OF CONDUCT The ABB Code of Conduct (CoC) is the foundation of our commitment to integrity. It provides practical guidance to our workforce, suppliers and other business partners in how we expect business to be conducted worldwide. We are convinced that, in order to continue to be an industry leader in a challenging environment, we must drive the highest standards of integrity, accountability, sustainability and transparency. The CoC stipulates five integrity principles: • We behave and do business in an ethical way • We work in a safe and sustainable way • We build trust with all stakeholders • We protect ABB’s assets and reputation • We speak up and do not retaliate The CoC includes sixteen integrity focus areas including, among other aspects, anti-bribery and anti-corruption, communication, conflicts of interest, fair competition/antitrust, human rights, prevention of money-laundering, privacy, etc. It also outlines how individual concerns can be raised and how potential whistleblowers will be protected. The CoC applies globally to all of ABB’s employees, managers, officers, directors, consultants, self-employed contractors, casual workers, agency workers and volunteers. It also applies to ABB’s wholly owned affiliates and subsidiaries as well as all employees of any joint venture or other entity in which ABB has majority ownership interest or exercises effective control. The most senior level that is accountable for the implementation of the CoC is the Chief Executive Officer. Third-party standards referred to in the CoC include the International Labour Organization’s (ILO) Core Conventions on Labour Standards (in the fair employment and the human rights sections) and, for human rights specifically, the UN Global Compact and the Global Business Initiative for Human Rights. Relevant internal and external stakeholders are expected to benefit from the implementation of this Policy. The CoC is available to everyone, including ABB employees and stakeholders on the global ABB website. SUPPLIER CODE OF CONDUCT To make sure that we only work with suppliers who share our commitment to integrity, sustainability and human rights, we ask our suppliers to meet the requirements set out in our Supplier Code of Conduct (SCoC). The SCoC deals with human rights and decent work, health and safety, climate and environment, material compliance and responsible minerals, business ethics, business and information security, procurement by suppliers, documentation / inspections / reporting / corrective actions, reporting concerns and access to remedy. The SCoC states that we only enter into business relationships with third parties that share our ethical standards. Furthermore, our suppliers are urged to comply with all regulations and laws on reporting or disclosure of human rights and environmental due diligence and to take appropriate action in case of non-compliance. ABB SUSTAINABILITY STATEMENT 2024 21 The SCoC applies to all of ABB’s suppliers. The term “suppliers” refers to third parties, including individual contractors, that we engage to purchase goods and/or services and/or works from. The most senior level that is accountable for the implementation of the policy is the Chief Executive Officer. As third-party frameworks, the SCoC refers explicitly to the International Bill of Human Rights, the UNGPs, the ILO Declaration on Fundamental Principles and Rights at Work, the United Nations Global Compact (UNGC), the Rio Declaration on Environment and Development, the UN Convention Against Corruption, the Convention on Biological Diversity, the UN Framework Convention on Climate Change (UNFCCC), the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal, the Stockholm Convention on Persistent Organic Pollutants (POPs), and the Minamata Convention on Mercury. Relevant internal and external stakeholders are expected to benefit from the implementation of this Policy. The SCoC is included as a link in our procurement terms and conditions and therefore accessible for suppliers. As an additional source, we provide our procurement terms and conditions, our SCoC and the accompanying Implementation Guide on our website. HUMAN RIGHTS POLICY AND DUE DILIGENCE FRAMEWORK Our Human Rights Policy formalizes and specifies the commitment of ABB to support and respect the human rights of every individual and community as outlined in the ABB Code of Conduct. Furthermore, it provides a common framework that acknowledges the company’s responsibility to respect human rights and it describes the management approach on human rights due diligence for the Group. ABB’s Human Rights Due Diligence Framework commits to implement Human Rights Due Diligence throughout its business to proactively assess, cease, prevent and mitigate actual and potential adverse human rights on rightsholders along our value chain. Furthermore, it lays out the governance of an embedded and integrated respect for human rights with a cross-business Human Rights Working Group. The Human Rights Working Group is responsible for defining the human rights roadmap, objectives and targets, including development programs, in collaboration with the Legal & Integrity function. The Framework requires us to track and communicate our performance and it stipulates access to grievance and remedy. Our Human Rights Policy applies globally to all employees, managers, officers, directors, consultants, self-employed contractors, casual workers, agency workers and volunteers. It also applies to our wholly owned affiliates and subsidiaries as well as all employees of any joint venture or other entity in which ABB has majority ownership interest or exercises effective control. The most senior level that is accountable for the implementation of the policy is the Chief Executive Officer. The policy supports and respects the following international human rights frameworks: International Bill of Human Rights; ILO Core Labour Conventions (including ILO Convention No. 138 on minimum age for admission to employment and ILO Convention No. 182 on the worst forms of child labor); OECD Guidelines for Multinational Enterprises; OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas; UN Convention on the Rights of the Child; United Nations Guiding Principles on Business and Human Rights (UNGPs); UN Global Compact (UNGC); UNICEF’s Children’s Rights and Business Principles (CRBP); Voluntary Principles on Security and Human Rights. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. The Human Rights Policy and ABB’s Human Rights Due Diligence Framework are publicly available on ABB’s corporate website for the company’s external stakeholders, suppliers and business partners in all relevant languages. They are also available on the company’s internal communications channels. 22 ABB SUSTAINABILITY STATEMENT 2024 POLICY ON HEALTH, SAFETY, ENVIRONMENT & SECURITY In our Group-wide HSE&S Policy, we confirm to be committed to putting health, safety, environment, and security (HSE&S) at the heart of all our activities. This includes materials sourcing, product design, operations, and services and climate change. Required by the policy is an HSE&S management system based on internationally recognized sustainability standards, principles and commitments and is prepared and maintained in collaboration with business areas. The policy applies to all ABB subsidiaries worldwide, business areas, divisions, corporate functions and global business services. Furthermore, it is applicable and mandatory for all ABB units in all our legal entities, including joint ventures, consortia, working partnerships and third-party service providers under ABB management control. The most senior level that is accountable for the implementation of the policy is the division presidents. Our HSE&S management system is based on internationally recognized sustainability standards, principles and commitments including ISO 45001 and ISO 14001. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. The policy is an internal document and is accessible via the internal network for all employees. 01 ENVIRONMENTAL INFORMATION 24 Protecting the climate 39 Committing to circularity 43 Water management at ABB 45 Keeping pollution in check 46 EU Taxonomy: Disclosures for financial year 2024 24 ABB SUSTAINABILITY STATEMENT 2024 — PROTECTING THE CLIMATE — Toward a low- carbon economy Enabling a low-carbon society is at the center of our purpose and value proposition and a key pillar of our Sustainability Agenda. At ABB, we want to help our customers reduce and avoid emissions through our products, solutions and services. We also work toward reducing emissions in our own operations and in those of our suppliers. We aim to drive the shift towards a low-carbon economy with innovative technologies. Our expertise in electrification and automation enables greater energy efficiency and the integration of renewable energies into the energy mix. We work with our customers and suppliers to help them save energy and reduce emissions across their value chains. Our commitment to supporting energy security and the transition to a low-carbon society is also demonstrated by the work we are doing to increase energy efficiency and reduce emissions in our own operations. E1-1: TRANSITION PLAN IN PROGRESS The basis for our climate transition plan is our set of near- and long-term greenhouse gas reduction targets (scope 1, 2 and 3), which were approved by the Executive Committee (EC) and the Board of Directors in 2023. These targets were validated by the Science-Based Targets initiative (SBTi) in June 2024 as being in line with the net-zero standard. Our long-term targets are also aligned with the Swiss climate goals. In 2024, our scope 1 and 2 targets were part of our annual incentive plan (AIP) and included in the long-term incentive plan (LTIP) for the top management (for AIP and LTIP, see p. 9). The 2024 forecast of scope 3 category 1 emissions were set at division level and approved by the EC. The full scope 3 division-level forecast for 2030 will be approved by the EC in 2025. We report annually on our greenhouse gas reduction performance against scopes 1, 2 and 3. In line with our SBTi net-zero absolute reduction targets, we are committed to reaching net-zero greenhouse gas emissions across the value chain by 2050. As the SBTi net-zero standard only allows for Negative Emission Technologies (NETs) to be used for a maximum of 10 percent of residual emissions in 2050, rather than for the 2030 targets, we will analyze the respective investment options later. To reduce ABB’s operational emissions (scopes 1 and 2), we have defined and are implementing several decarbonization levers. When it comes to our value chain, our products and solutions help our customers reduce emissions. At the same time, our scope 3 category 11 emissions increase as long as the electricity in the grid is not decarbonized. To tackle value-chain emissions, where scope 3 category 1 and scope 3 category 11 represent 3.1 percent and 96.6 percent of emissions respectively, we have identified the following decarbonization levers: ABB SUSTAINABILITY STATEMENT 2024 25 Scope 3.1 (3.1 % of total scope 3) 1. Collaborate with suppliers and customers on low-carbon material availability and use 2. Increase availability of product carbon footprints (PCFs) from suppliers 3. Engage suppliers on PCF reduction commitments and implement carbon pricing Scope 3.11 (96.6% of total scope 3) Decarbonizing electricity grids is the single most critical element to reduce ABB’s scope 3 category 11 emissions. 1. Market ABB products and solutions that enable electricity grid decarbonization 2. Innovate to increase the product portfolio that enables energy efficiency and decarbonization 3. Collaborate with customers to implement the most efficient ABB technology solutions In 2024, we completed a physical and transition risk assessment. We intend to integrate the results of this risk assessment into the climate transition plan. We will be formalizing our scope 3 decarbonization measures and quantifying the financial effects excluding NET investments and seeking approval of our transition plan. — Climate risk and opportunity assessment ESRS-2 SBM-3: RESILIENCE IN CLIMATE MATTERS The DMA performed in 2024 (see chapter “Sustainability at ABB”, sections “Material impacts, risks, and opportunities” and “Double Materiality Assessment”) identified 24 IROs relating to climate, three of which were classified as risks. Two of the identified risks are categorized as physical risks. One of these focuses on direct effects of extreme weather events on our facilities, whereas the second of these takes into consideration the health and security of our employees. The third risk is classified as a policy and legal transition risk, which could require adjustments to a specific product category. During 2024, we also performed a detailed climate risk assessment focusing on physical and transition risks based on defined climate scenarios. Of the identified physical climate risks, storms and floods were assessed as the most relevant acute hazards while heat and precipitation stress were assessed as the most relevant chronic hazards. For transition risks, the qualitative assessment concluded that market, policy and legal, as well as, reputation are the categories which could potentially pose the highest risks for ABB. For further information on our climate risk assessment, please also see the section on IRO-1 below. Based on the insights gained from this assessment, mitigation and adaptation measures can be defined and assessed to address the identified vulnerabilities, enabling our business areas and divisions to either implement risk responses or accept the associated risks. 26 ABB SUSTAINABILITY STATEMENT 2024 Our susceptibility to physical risks centers around the climate-related hazards of storms and floods, which was highlighted through the risk assessment based on a high emission scenario. We invest in adaptation measures to improve our resilience, including emergency response planning, as well as infrastructure and equipment enhancements. Further potential measures to improve our resilience were also identified on a hazard-specific basis as an outcome of the climate risk assessment. Measures being considered for potential implementation in the future include, for example, on-site water storages to address water stress at relevant sites. Market transition risks are addressed through continuous investments in research and development for low-carbon technologies, which not only mitigates risks, but also enables us to benefit from the opportunities in market segments that are identified as growth drivers, especially in a scenario aligned with the Paris Agreement. Policy and legal transition risks may have an influence on the pricing or availability of raw materials. In addition, regulatory changes may prohibit the production and sales of specific products, which may directly reduce our revenues. To mitigate such risks, we are evaluating alternative measures which are not exposed in the same magnitude to policy interventions, such as carbon pricing. In addition, we are closely monitoring the regulatory environment to adapt to new regulations with corresponding research and development efforts. Reputational transition risks can result from our own ambition and targets that we have committed to. If, for example, we were not to meet our GHG scope 1, 2 or 3 emission reduction targets by 2030 or our SBTi commitment, this may reflect poorly on our reputation. — Material impacts, risks and opportunities resulting from climate change IRO-1: PROCESSES TO IDENTIFY AND ASSESS MATERIAL IROs ABB’s climate-related IROs have been a decisive element in our 2024 DMA. A number of other processes, analyses and assessments contributed to our understanding of the prevalent risks. This includes our analyses of physical and transition risks resulting from climate change, as well as our analyses of company emissions data, publicly available climate change scenarios, and pathways and their application in the context of the ABB Group and their potential implications in the future. The DMA revealed 24 IROs for ABB regarding climate, of which ten were classified as impacts, three as risks and eleven as opportunities. IMPACTS ON CLIMATE CHANGE Of the ten impacts identified in our DMA, four were regarded as positive – one in our own operations and the others in the upstream or downstream value chain, and six as negative – three in our own operations and three in the value chain. The negative impacts in our own operations result from (a) the production process for the materials used and the assembly of the products, (b) the burning of fossil- based fuel sources and (c) the energy consumption from buildings. Negative impacts resulting from our value chain include processes such as raw material extraction, transportation, the smelting of components and manufacturing processes, where energy-intensive methods are used that cause high greenhouse gas emissions. These emissions intensify climate change. Positive impacts include the fact that by developing energy-efficient processes, we can reduce our energy consumption and associated emissions. Implementing sustainable practices in the upstream value chain together with suppliers, such as using clean energy, energy-efficiency measures or recycled materials, can help to reduce the overall carbon footprint. Furthermore, ABB technologies used by our customers and end-users can potentially enhance energy efficiency and reduce resource consumption, which leads to a reduction of greenhouse gas emissions. ABB SUSTAINABILITY STATEMENT 2024 27 PHYSICAL RISKS ASSOCIATED WITH CLIMATE CHANGE Physical climate risks are associated with the direct impact of climate change on our assets, operations and value chain. These risks can be chronic or acute. Chronic physical risks refer to long-term changes in climate patterns, such as rising temperatures, sea-level rise or changing precipitation patterns. These gradual changes can lead to increased operational costs, reduced productivity and damage to infrastructure. Acute physical risks, on the other hand, involve immediate, extreme weather events like hurricanes, floods, wildfires or heatwaves. Such events can cause sudden and severe asset damage and disruptions to operations, leading to losses in revenue and additional capital expenditures to rebuild assets, as well as safety concerns. As part of our climate risk assessment, we have a comprehensive approach for identifying and assessing physical risks arising from climate change, which can be summarized in the following key steps: • Relevant scenarios informed by the latest scientific research and relevant for the situation at ABB are identified, and an appropriate time horizon is chosen for the analysis. We use advanced natural hazards and climate modelling tools, along with scenarios from the Intergovernmental Panel on Climate Change • (IPCC), including the high-emissions scenario of Representative Concentration Pathways (RCP8.5), to assess climate hazards and their risk impacts on operational sites. • Each scenario is qualitatively assessed at two different time horizons: medium-term (one to five years) and long-term (30 years). Specifically for the physical risk assessment, short- and medium-term time horizons are considered simultaneously as the difference in these brief periods hardly result in relevant changes of the underlying scenario data. The selection of time horizons for physical risks focuses on the current reporting cycle (one year), strategic planning horizons and capital allocation plans (up to five years) as well as expected operational lifetimes of our assets, which are assumed to be operational either based on their remaining technical lifetime or continuous long-term operation at those sites. The long-term horizon also considers the expectation that adverse climate-related events could become more frequent and increase in severity. • To conduct the assessment, data on our asset structure, geolocations and other factors are collected from internal systems. The sites in scope cover the largest sites across all business areas based on their energy consumption and headcount and are located in 59 countries, represented by manufacturing and non-manufacturing sites, distributed across the globe. • Geospatial physical risk data is obtained from specialized tools complemented by an internal methodology and employed to perform a detailed risk assessment for the selected time horizons and scenarios. • A combined risk and vulnerability assessment is completed, integrating data to assess potential climate-related hazards, which considers return periods, hazard severity, as well as risk scores. We decided to focus the initial physical risk assessment on our own operations because direct effects are expected to have the highest significance. In addition, due to our global value chain structure, it is expected that many of the physical climate risks identified are generally applicable to the supply chain and to customers. Extending the assessment to the value chain is anticipated for future years. 28 ABB SUSTAINABILITY STATEMENT 2024 TRANSITION RISKS AND OPPORTUNITIES ASSOCIATED WITH CLIMATE CHANGE Climate transition risks and opportunities arise from the shift towards a low- carbon economy and the broader societal and regulatory response to climate change. The risks encompass a range of factors, including regulatory changes, market dynamics, technological advancements, shifts in consumer preferences, as well as litigation risks. For example, stricter environmental regulations, such as carbon pricing or emission reduction targets, can increase operational costs or necessitate substantial changes in business practices. Transition risks also include reputational risks, where failure to address climate change adequately could damage a company’s reputation and stakeholder relationships. Similarly, market risks may emerge as demand shifts towards more sustainable products and services, potentially affecting our market share and profitability for certain products. At the same time, this can lead to opportunities, such as increased demand for other products and services, which support the transition to a low- carbon economy. Further potential opportunities relate to improving resource efficiency, transitioning to lower-emission energy sources, developing climate- friendly products and services, accessing new markets driven by climate-related solutions, and enhancing resilience through mitigation of climate risks and sustainable supply chains. Our transition risk and opportunity assessment is based on a scenario to limit climate change to 1.5°C (RCP2.6) above pre-industrial levels. We assessed the risks and opportunities qualitatively. The approach involved representatives from all business areas and corporate functions. The assessment approach is structured along four steps that are described below. First, the most relevant drivers of the scenario are identified. These include both macroeconomic forecasts, such as GDP and population development, as well as techno-economic parameters, such as carbon and fossil fuel prices by region, electrification rates across sectors or deployment rates of technologies. Secondly, hypotheses on the impact pathways are formulated based on the information of the previous step as well as the specific value chain of the business areas. The identified impact pathways are structured into risks and opportunities. Thirdly, the risks and opportunities are qualitatively scored by representatives of our business areas and corporate functions. Risks and opportunities can also be disregarded or added based on the implications of the scenario on each business area. Finally, the risks and opportunities are aggregated based on our ERM risk aggregation methodology. The transition risk assessment is based on three time horizons; short-term (up to one year), medium-term (two to five years; to align with both our financial planning and enterprise risk management timeframes) and long-term (more than five years). In line with the categories of policy and legal, technology, market and reputation for risks and resource efficiency, energy source, products and services, markets and resilience for opportunities, the corresponding risk and opportunity impact drivers are derived from the underlying scenario narrative by connecting the scenario data with our business area activities. We have assessed the extent to which the company’s assets and business activities may be exposed and are sensitive to the identified transition risks and opportunities. This assessment is based on likelihood and potential financial impact of transition events. Both the magnitude and likelihood are rated on a qualitative scale based on our ERM methodology. The duration of the transition risks and opportunities are characterized by their occurrence in the scenario data, which is reflected by milestone years such as 2025 or 2030. ABB SUSTAINABILITY STATEMENT 2024 29 We chose the “Net Zero Emissions by 2050” scenario of the International Energy Agency (IEA) as the basis for the transition scenario analysis as it features net zero CO 2 energy sector and industrial process emissions in 2050, while achieving universal energy access in 2030. The selection of scenarios chosen by ABB for the physical and transition risk analysis reflects a wide range of potential future outcomes. On the one hand, limiting global warming in line with the Paris Agreement is reflected by the RCP2.6 (1.5°C) scenario whereas a high temperature scenario represented by RCP8.5 (ranging from 3.2°C to 5.4°C) illustrates climate-related hazards if climate change cannot be mitigated globally. — Climate change- related policies E1-2: POLICIES ABB uses several policies and procedures to manage its impact on climate change. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the Sustainability Policy, the ABB Code of Conduct, the Supplier Code of Conduct and the HSES Policy. More specific policies are outlined below. ENERGY MANAGEMENT REQUIREMENTS This policy establishes the minimum requirements to be met for energy management at sites and in operations controlled by ABB. It demands from all ABB units to establish an energy baseline and to classify the significance of their energy footprint. Managers are asked to consider energy in long-term planning, including the identification and consideration of retrofit requirements. ABB units with significant energy footprints shall introduce a basic energy management system and an action plan. This policy is complemented by an Energy Management Approved Code of Practice (ACOP), which includes concrete examples. The Energy Management Requirements cover 12 of the 24 climate-related IROs, including all impacts in own operations and the downstream value chain, one of the three risks and three of the 11 opportunities (i.e., those relating to own operations). This internal policy applies to all employees and covers all sites and operations controlled by ABB. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no specific third- party standards or initiatives referenced in this policy. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. NET ZERO PROCEDURE In 2023, ABB introduced an overarching target of reaching net zero emissions by 2050. To support the achievement of this target, ABB has made several commitments, which can be broken down by near-term (2030) and long-term (2050) horizons. The Net Zero Procedure applies to all employees and units of ABB worldwide, joint ventures, consortia, working partnerships, and third-party service providers under ABB management control. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no specific third- party standards or initiatives referenced in this policy. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. 30 ABB SUSTAINABILITY STATEMENT 2024 RENEWABLE ELECTRICITY PROCEDURE Our Net Zero Procedure (above) specifies the commitments to reach our net zero target, including converting 100 percent of our electricity consumption to renewable sources by 2050. This will be achieved through purchase and self- generation of renewable electricity. All country-wide or site-level electricity contracts shall include 100 percent renewable electricity by 2030. The Renewable Electricity Procedure defines what type of contracts, sources and market boundaries are acceptable. It largely follows the guidance set by the RE100 initiative. The Renewable Electricity Procedure applies to all employees and units of ABB worldwide, joint ventures and consortia under ABB management control. The most senior level that is accountable for the implementation of the policy is the division presidents. The Renewable Electricity Procedure is modelled on the requirements of the RE100 initiative. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. FLEET ELECTRIFICATION PROCEDURE As part of our transition towards our net zero target, we have committed to electrify our fleet of vehicles in line with the requirements of the EV100 initiative of the Climate Group. The Fleet Electrification Procedure applies to all employees and units of ABB worldwide. The most senior level that is accountable for the implementation of the policy is the division presidents. The Fleet Electrification Procedure is modelled on the requirements of the EV100 initiative. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. Adaptation Procedure in progress Based on insights gained from the climate risk assessment, adaptation measures will be assessed and designed jointly with the local facility and site managers. Currently, ABB does not yet have a global adaptation procedure in place. Developing this procedure is a priority for the coming year. — Climate change- related targets E1-4: TARGETS To achieve net zero, ABB has set SBTi-aligned near-term and long-term greenhouse gas reduction targets. Both sets of targets employ the absolute contraction methodology as outlined by the SBTi and have been validated by the initiative. Near-term targets (2030) • Reduce absolute scope 1 & 2 GHG emissions by 80 percent from 2019 to 2030. Target validated by SBTi and is 1.5°C aligned. • Reduce absolute scope 3 GHG emissions by 25 percent between 2022 and 2030. Target validated by SBTi and is “Well below 2°C aligned”. Long-term targets (2050) • Reduce absolute scope 1 & 2 GHG emissions by 100 percent from 2019 to 2050. Target validated by SBTi and is 1.5°C aligned. • Reduce absolute scope 3 GHG emissions by 90 percent between 2022 and 2050. Target validated by SBTi and is 1.5°C aligned. ABB SUSTAINABILITY STATEMENT 2024 31 We have also committed to three initiatives of the Climate Group to help us to achieve our near-term scope 1 and 2 GHG emissions reduction target: • Consume 100 percent of our electricity from renewable sources by 2030. Commitment made to RE100 initiative. • Electrify our global vehicle fleet by 2030. Commitment made to EV100 initiative. • Improve our energy productivity by 20 percent by 2030 relative to 2019 and implement an energy management system across global operations by 2030. Commitment made to EP100 initiative. AVOIDED EMISSIONS AMBITION In addition to our SBTi-aligned GHG emissions reduction targets, we have the ambition to avoid emissions in customer operations. Avoided emissions are the reduction in GHG emissions that occur because of the use of a product or solution. We use the category of avoided emissions to describe the volume of greenhouse gas emissions that our customers will avoid by using our products and solutions through their full service lives. The methodology for calculating avoided emissions is based on the 2023 guidance of the World Business Council for Sustainable Development (WBCSD). • Ambition to avoid 600 mt CO₂e emissions throughout lifetime of products sold from 2022 to 2030. GHG emissions reduction targets and avoided emissions ambition GHG emission category Description Base year Target years Absolute value of emissions (kt CO₂e) 2024 reduction compared to baseline year 2030 2050 Baseline year 2024 status (assured) Absolute value (kt CO₂e) Percentage Scope 1+2 GHG emissions Reduce own scope 1+2 CO₂e by 80% by 2030 and 100% by 2050 compared to 2019 2019 80% reduction 100% reduction 631 1 138 (493) -78% Scope 3 GHG emissions Reduce scope 3 CO₂e emissions by 25% by 2030 and by 90% by 2050 compared to 2022 2022 25% reduction 90% reduction 429,854 2 394,952 (34,902) -8% Avoided emissions Ambition to avoid 600 mt CO₂e emissions throughout lifetime of products sold from 2022 to 2030 2022 600 MT — — 204,390 3 — 0% 1 Scope 1 + 2 GHG emissions baseline value has been adjusted for portfolio changes. 2 Scope 3 emissions baseline has been adjusted due to product portfolio and applied technical parameters refinement. In one business, the baseline was revisited as one business activity was deemed not representative for the year. 3 Avoided emissions 2024 status is cumulative for 2022-2024, where only the 2024 value of 65,611kt CO2e has been assured for 2024. Market- and location-based scope 1 + 2 GHG emissions reduction GHG emission category (kt CO₂e) Absolute value of emissions in baseline year (2019) 1 2024 status (assured) 2024 reduction compared to baseline year Absolute value Percentage Market-based 631 138 (493) -78% Location-based 645 405 (240) -37% 1 Scope 1 + 2 GHG emissions baseline value has been adjusted for portfolio changes. 32 ABB SUSTAINABILITY STATEMENT 2024 The consistency between our GHG emissions reduction targets and the GHG inventory boundaries is ensured through clearly defined and documented inventory boundaries that are reviewed annually. Material changes in our structure, acquisitions or divestments, are reflected accordingly. Within our alignment to SBTi, we have committed to incorporate all significant emission sources in our inventory and to annually report on all relevant scope 3 categories. For scope 1 and 2, the baseline year remains 2019. Reorganizations, divestments and acquisitions have been reflected in restatements of the 2019 value in the years since 2020. For scope 3, the baseline year was set to 2022 as the target was introduced during 2023 and the previous year best represented the current business structure. The same applies to the baseline for the ambition to avoid emissions. — Management of climate change E1-3: ACTIONS Our efforts and achievements in addressing climate change are three-fold: • We are committed to reducing emissions in our own operations • We are committed to reducing emissions in our value chain by supporting our suppliers to reduce their emissions, and • We are committed to helping our customers reduce and avoid emissions through our products, solutions and services. To reduce scope 1 and 2 GHG emissions, several decarbonization levers have been defined and are being implemented. These levers can be disaggregated into fossil fuel reduction (through energy efficiency and decarbonization of fossil-fueled assets), a shift to renewable energy, fleet electrification and SF 6 management. The commitments to the RE100, EV100 and EP100 initiatives will support the reduction of scope 1 and 2 GHG emissions by 2030. For scope 3, the levers to reduce the most material categories, specifically emissions from use of sold products and purchased goods and services, are disclosed in the transition plan section of this statement. 2024 status of scope 1 + 2 decarbonization levers Scope 1 + 2 decarbonization levers 2024 status 2023 RE100 status: Percentage of renewable electricity consumption of total electricity consumption (%) 95% 94% EV100 status: Percentage of electric vehicles of total fleet of vehicles (%) 38% 31% EP100 status: Improvement of energy productivity since 2019 (%) 69% 66% Reduction of SF 6 since 2019 (%) -92% -91% ABB SUSTAINABILITY STATEMENT 2024 33 — Facts & figures Energy E1-5: ENERGY CONSUMPTION AND MIX ENERGY CONSUMPTION RELATED TO OWN OPERATIONS Total energy consumption (in GWh) 2024 2023 Total energy consumption from fossil sources (assured) 418 467 fuel consumption from natural gas 319 332 fuel consumption from crude oil and petroleum products 1 7 11 fuel consumption from coal and coal products — — fuel consumption from other fossil sources — — consumption of purchased or acquired electricity, heat, steam, and cooling from fossil sources 92 124 Total energy consumption from renewable sources (assured) 874 830 fuel consumption for renewable sources including biomass (also comprising industrial and municipal waste of biologic origin), biofuels, biogas, hydrogen from renewable sources, etc.; 2 11 3 consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources 828 802 consumption of self-generated non-fuel renewable energy 35 26 Total energy consumption (in GWh) (assured) 1,292 1,297 Due to rounding, numbers presented may not add to the totals provided. 1 Includes oil and diesel. 2 Use of renewable biogas to substitute natural gas in several sites. Energy intensity (MWh/Million $ of sales) 2024 2023 Total energy intensity (assured) 39.32 40.26 NON-RENEWABLE ENERGY PRODUCTION AND RENEWABLE ENERGY PRODUCTION Our total non-renewable production includes on-site electricity generation from oil and diesel, as well as from combined heat and power. The total renewable production includes on-site solar generation. Energy production (in GWh) 2024 2023 Total non-renewable energy production 13 16 Total renewable energy production 39 29 Total energy production 52 45 — Greenhouse gas emissions E1-6: SCOPE 1, 2, 3 EMISSIONS In 2024, we achieved a reduction of 78 percent in our scope 1 and 2 emissions compared to 2019. This progress was driven primarily by the roll-out of renewable energy in our sites, a reduction in SF6 emissions and the transition towards electric vehicles in our fleet. As a result, we are on track to reach our near-term 2030 target of 80 percent emission reduction. In 2024, scope 3 GHG emissions have decreased by 8 percent compared to the baseline year of 2022 with key drivers being the decline in scope 3 category 11 emissions due to a shift in the sales mix within our product portfolio, with a decrease in the share of more energy-intensive products compared to previous years. As our products are essential for the decarbonization of our value chain, the sale of our equipment supports the integration of renewables into the grid and will in turn lead to reductions of our own scope 3 emissions. For the reporting of scope 3 emissions in category 11, we have previously published a “representative scenario” and a “strict scenario”, with the representative scenario quantifying the energy consumption of certain products based on measured energy loss and the strict scenario taking a more conservative approach based on the full energy input to certain products. Going forward, we will use the strict scenario as basis for our scope 3 reporting. 34 ABB SUSTAINABILITY STATEMENT 2024 OVERVIEW OF SCOPE 1, 2 AND 3 GHG EMISSIONS (kt CO₂e) 2024 2023 Gross scope 1 GHG emissions, of which Use of fuels 67 70 Coolants 4 4 SF 6 8 9 Transport by own fleet 40 44 Emissions from biofuels — — Total scope 1 emissions (assured) 119 128 Gross scope 2 GHG emissions, market-based District heat 8 10 Electricity 10 13 Gross scope 2 GHG emissions, location-based District heat 8 10 Electricity 278 285 Total scope 2 GHG emissions, market-based (assured) 19 23 Total scope 2 GHG emissions, location-based (assured) 286 295 Total scope 1+2 GHG emissions, market-based 138 151 Total scope 1+2 GHG emissions, location-based 405 423 Gross indirect (scope 3) GHG emissions 1 Purchased goods and services 1 12,172 12,566 2 Capital goods 1 85 69 3 Fuel and energy-related Activities (not included in scope 1 or 2) 55 65 4 Upstream transportation and distribution 617 699 5 Waste generated in operations 12 15 6 Business traveling 169 154 7 Employee commuting 175 175 8 Upstream leased assets — — 9 Downstream transportation 43 62 10 Processing of sold products — — 11 Use of sold products 2 381,372 433,347 12 End-of-Life treatment of sold products 1 230 261 13 Downstream leased assets 18 3 14 Franchises — — 15 Investments 1 2 9 Total scope 3 GHG emissions (assured) 394,952 447,426 Total scope 1, 2 and 3 GHG emissions (market-based) (assured) 395,090 447,577 Total scope 1, 2 and 3 GHG emissions (location-based) (assured) 395,357 447,848 Due to rounding, numbers presented may not add to the totals provided. 1 Cat. 1, 2, 12 and 15 emissions were adjusted for prior years due to a refined calculation of inflation impact on spend-based emission factors. 2 Cat. 11 emissions were adjusted for prior years as refined technical parameters have been applied. In one business, the 2022 baseline was revisited as business activity was deemed not representative for the year. For the calculation of the GHG emission intensity, the total ABB Group revenues are applied. Scope 1, 2 and 3 GHG emission intensity (kt CO₂e/Million $ of sales) 2024 2023 Market-based (assured) 12.03 13.88 Location-based (assured) 12.04 13.89 The scope of consolidation for GHG emissions reporting follows the Group standards outlined in the section “Approach to reporting” at the beginning of this Sustainability Statement. In 2024, mergers and acquisitions did not constitute significant changes to the GHG emissions reporting. ABB SUSTAINABILITY STATEMENT 2024 35 We calculate our scope 1 and 2 GHG emissions using detailed methodologies that incorporate assumptions and standardized emissions factors. For scope 1 emissions from our fleet vehicles, we collect vehicle-specific data, such as fuel type, distance traveled and emissions profiles for every vehicle in the fleet. If this is not available, estimations are applied. In particular, the distance travelled is estimated based on the leasing contract duration. Fleet emissions factors are based on WLTP/NEDC emission profiles per vehicle and provided in g CO 2 /km. They are then adjusted to the lab-to-road factor based on the vehicle’s location. Emissions from the on-site use of fuel, coolants and SF 6 are calculated using data reported quarterly or annually, depending on the facility size, with site-specific emissions factors. For scope 2 emissions from purchased electricity and district heating, we collect and process energy consumption data from facilities worldwide, applying both location-based and market-based emissions factors. Location-based calculations use average grid emission factors in kg CO 2 e/kWh specific to each geographic location, while market-based calculations consider specific contractual arrangements like renewable energy purchases or power purchase agreements, with emissions factors obtained from external industry sources. For a minority of locations, where environmental data is not readily available, we employ an estimation process. This includes, in particular, smaller sites with energy consumption lower than 100 MWh per year and fewer than 100 employees. For these sites, environmental data is extrapolated based on the employee headcount at these sites and average consumption per employee from sample reporting sites. For Q4, estimations were applied where year-end actuals have not been available at the time of reporting. In scope 1, we only consider methane and N 2 O emissions of biogenic emissions, following SBTi guidance, amounting to 2 t of CO 2 e in 2024. Biogenic emissions of 2,370 t of CO 2 e are not included in scope 1. Our renewable electricity consumption comes from bundled and unbundled procurement of Energy Attribute Certificates (EACs) as well as onsite solar PV generation. For scope 3 emissions, we account for all scope 3 categories that are relevant to ABB and that are not covered in scope 1 and 2 (refer to the list of included categories above). As the vast majority of our emissions stem from the use of sold products, this category represents the most significant contribution. Nevertheless, we diligently calculate all other scope 3 categories relevant to ABB to ensure comprehensive reporting. When assessing the materiality of the different scope 3 categories, we refer to the GHG Protocol Corporate Value Chain Accounting and Reporting Standard. The calculation of scope 3, category 11 emissions is based on a bottom-up model for the diverse offering across our divisions. The model considers both the technical specifications and the operating conditions associated with each product, including product energy consumption metrics and efficiency specifications. We use two primary methods to estimate energy consumption during the operational phase of sold products: • Energy Input Method: Applied to products that require specific power inputs to perform their tasks, such as motors, automation systems and robotics. • Energy Loss Method: Used for products where energy efficiency losses are critical, such as electrical drives and switchgear. The total energy consumed is converted to GHG emissions using regional emission factors from the IEA in alignment with regional electricity grid compositions. These factors are updated annually to reflect changes in grid emission intensities. 36 ABB SUSTAINABILITY STATEMENT 2024 Remaining scope 3 emissions (everything apart from category 11) encompass a broad range of indirect emissions. Data sources include, for example, spend figures for purchased products and services, transportation and distribution or business travel. Depending on the category, we use different methods to calculate these emissions: • Spend-Based Method: Applied to categories such as purchased goods and services or capital goods, where we calculated emissions based on the financial expenditure. Emission factors are derived from economic input- output models that relate spending to GHG emissions (e.g., Exiobase). • Activity-Based Method: For categories such as business travel, emissions are approximated using activity data such as travel miles, number of trips and transportation modes. The total emissions are then converted to GHG emissions using regional emission factors (where applicable), ensuring alignment with the geographical areas where activities occur. The scope 3 data collection is supported by an ABB-customized reporting tool in line with our internal and external assurance requirements. For the calculation of avoided emissions, ABB has developed a methodology based on WBCSD guidance, tailored to its product portfolio. According to WBCSD’s guidance, “avoided emissions” refers to the reduction in GHG emissions achieved by comparing our products or solutions to a reference scenario where the solution is not used. Both the product and reference scenario are assessed through their entire life cycles. Three scenarios are considered: replacement, retrofit and new installation. Data is collected covering the percentage of sales, or orders where deemed more relevant, and kWh/t CO₂e. The data is drawn from our sales teams and the products’ technical specifications. Alongside the three scenarios, several factors provided by the WBCSD guidance for avoided emissions affect the eligibility of avoided emissions against our ambition: • Gate 1 (climate action credibility): ABB transparently reports on 100 percent of its value chain emissions on an annual basis. This covers 13 of the 15 scope 3 GHG Protocol categories. Using this comprehensive GHG inventory, we have set SBTi targets. We will not be using avoided emissions to claim net-zero status. • Gate 2 (climate science alignment): We do not consider avoided emissions from product lines or solutions sold to sectors and applications linked to exploration, extraction, mining, production, distribution or sale of fossil fuels. • Gate 3 (contribution legitimacy): We only consider avoided emissions that arise from installations that drive change within their respective markets. For example, only high-efficiency motors in a higher energy-efficiency class than the installed base average and used in a retrofit application would be eligible for inclusion. As for general applications like drives, we consider the retrofit of existing direct-on-line motor-driven systems as their main contribution to avoided emissions. In new installations of motor-driven systems, we exclude applications where the customer has already decided to install a drive. We only include sales where the customer has been convinced to install a drive with the motor, thereby improving overall efficiency. ABB SUSTAINABILITY STATEMENT 2024 37 Avoided emissions are calculated based on the following formula: Avoided lifetime emissions (kg CO₂e) = annual energy saved (MWh) × emission factor (kg CO₂e/MWh) × lifetime (years) • Annual energy saved: Energy saved on a yearly basis when comparing the product or solution with the relevant reference scenario using the following four elements: a) power input of the product/solution assuming use of 100 percent of rated energy input value 1 , b) operating hours per year, c) percentage of revenues from eligible avoided emissions scenarios (replacements, retrofits, new installations) 1 , d) percentage of efficiency gains in each scenario. • Emission factor: Weighted-average emission factor based on geography of where the respective product or solution is used, using the IEA and United Nations Economic Commission for Europe (UNECE) data, multiplied by regional revenue exposure. • Lifetime: Average expected lifetime of the product or solution, using Product Category Rules data, when available and applicable, used also for the product’s or solution’s Life Cycle Assessment, or expert opinion if not available. Reporting periods of value chain and ABB entities do not differ significantly, and limited effects on our GHG emission reporting are expected. Currently, we primarily use secondary data to calculate scope 3 emissions. Certain scope 3 GHG emission categories are not applicable to ABB such as category 8 (upstream leased assets) has been excluded as we already account for our leased assets within our scope 1 and scope 2 GHG emission footprint through the operational control consolidation approach. By including leased assets in scope 1 and 2, further inclusion in scope 3 would lead to double counting and is therefore not applicable. Category 14 (franchises) has been excluded because we do not operate any franchises. The scope 3 categories included in our inventory are shown in the table “Overview of scope 1, 2 and 3 GHG emissions”. We report scope 3 GHG emissions following the boundaries and methodologies defined by the GHG Protocol Corporate Standard. The reporting scope covers both upstream and downstream activities, including categories as defined in ESRS E1-6, AR 46.i, ensuring comprehensive representation of our value chain. Emissions are attributed based on our operational and value chain control, excluding immaterial sources or categories not applicable to our business model, such as franchises. — Physical and transition climate risks and opportunities E1-9: ANTICIPATED FINANCIAL EFFECTS PHYSICAL RISKS The qualitative physical risk assessment clustered approximately 340 sites in low- to high-risk categories. The findings of the assessment showed an increased risk of floods and storms across the short-, medium- and long-term time horizons under different scenarios. Our analysis indicates that the hazards identified are expected to have a medium impact under the moderate RCP4.5 scenario. However, the severity of these hazards and the impact on our business may increase under the more extreme RCP8.5 scenario, which confirms the understanding that higher rates of global warming increase the susceptibility to those climate-related risks. A limited number of sites in the United States and China show high counts of identified climate-related physical risks applicable for both acute and chronic risk in the long-term within ABB's asset portfolio. The assets could be temporarily impacted through reduced production capacities as well as face higher insurance premiums in the future. 1 Due to the lack of readily available precise external data or analysis, we utilize the best available assumptions. The avoided emission calculation is highly sensitive to these assumptions. A percentage change in either assumption will result in an equivalent percentage change in the calculated avoided lifetime emissions. 38 ABB SUSTAINABILITY STATEMENT 2024 When examining hazards such as flooding under a strong global warming RCP8.5 scenario, we observe a progressive increase in the number of assets at higher risk levels between the medium- and long-term time horizon. Similarly, for storms under the RCP8.5 scenario, there is a rise in the number of assets at high risk, indicating a growing risk level over time. TRANSITION RISKS In the qualitative transition risk assessment using a 1.5°C scenario, policy and legal risks as well as market risks arising from GHG emission pricing schemes could have an impact on our revenue and margin. Specific identified risks relate to: • Commodity/raw material prices: As carbon pricing regulations become stricter, the costs of carbon-intensive inputs rise, leading to increased expenses in sourcing and manufacturing, which could affect our profitability. • Carbon footprint of the product portfolio: With a growing emphasis on carbon reduction, the demand for low-carbon products increases and we need to adapt our product offerings to align with this trend, ensuring a reduced carbon footprint for the product portfolio. Failure to do so could result in decreased customer demand and market share loss. A further consideration includes reputational risk, which, for example, could arise from business activities with clients in industries that might be prone to stigmatization due to their contribution towards climate change and thereby reflecting poorly on ABB’s stakeholder perception. Furthermore, failing to meet communicated GHG reduction targets could erode stakeholder trust and consequently impact long-term revenues. CLIMATE-RELATED OPPORTUNITIES The opportunities inherent in the transition to a low-carbon society can lead to significant market growth. ABB’s eligible products under the EU Taxonomy (which also meet the substantial contribution criteria as a first prerequisite toward EU Taxonomy alignment, currently in process) are a proxy for the numerous product and service lines that cater to the needs of our customers. A major growth driver identified in the qualitative assessment is the global renewable energy market, which drives demand for our products. Regarding cost-saving activities, we are investing in energy efficiency and emissions reductions throughout our operations. For example, we have committed to electrifying our fleet of more than 10,000 vehicles by 2030 and continuing to deploy energy management systems at our sites. These substantial annual investments in energy efficiency and emissions reduction projects frequently come with cost savings in the long-term. This includes, for example, investments in low- carbon energy sources, upgrading compressed air systems, as well as heating, ventilation and cooling systems. ABB SUSTAINABILITY STATEMENT 2024 39 — COMMITTING TO CIRCULARITY — Strategic approach to circularity Preserving resources is a key pillar of ABB’s Sustainability Agenda and a core element of our value creation model. Our Circularity Approach is a company-wide effort to implement a resource-efficient business. Beginning with the design stage, we are committed to increasing the reusability and recyclability of our products and making them more durable by means of our lifetime extension and modernization services. We are working with customers, suppliers and partners to embed circularity throughout our entire value chain. The relevant functions assess the impact of our offerings through their complete life cycle. This process builds cooperation and partnerships with key stakeholders across industries and sectors – from recovering scrap from production to enabling take-back schemes in many markets. Within our own operations, we avoid waste by being more efficient and increasing the use of sustainable materials in our products and packaging, and by expanding recycling activities at our sites. Our Circularity Approach is managed by the ABB Circularity Working Group, which coordinates initiatives relating to circularity among our four business areas, clarifies and updates the ABB Circularity Framework, defines circularity KPIs and establishes the guidelines by which the KPIs are assessed. IRO-1: PROCESSES TO IDENTIFY AND ASSESS MATERIAL IROs During the 2024 update of the DMA, resource use was confirmed as one of our material topics. For more information on our process to identify material issues for our sustainability management, please see the chapter “Sustainability at ABB”. The 2024 DMA identified 21 IROs, of which 11 were classified as impacts, two as risks, and eight as opportunities. Of the 11 impacts, six are in our own operations, three of these being potentially positive, explained as our contribution to a circular economy through renewable resources, resource efficiency, recycling and similar activities. Repairing, maintaining and refurbishing installations at customer sites will also have a positive impact on the transition to a circular economy. Three other impacts in this area were assessed as actually negative. These relate to the depletion of non- renewable resources through our use of them. Actual positive impacts can be observed in our upstream and downstream value chains. By adopting practices such as product repairability, durability and other circular economy principles, we can reduce our overall resource outflow. By developing more circular solutions there is a potential for positive impact on the transition to a circular economy. Furthermore, the application of circularity principles at the end-of-life of products enables us to reuse resources more efficiently and thus, reduce the impact on the environment. Of the two identified risks, one concerns the whole business, including value chains. This is a combination of product obsolescence, slow time to market and the unavailability of essential resources. If these factors occur, they could lead to production delays and a reduced financial performance. The eight opportunities in this field relate to our own operations and one or both parts (upstream, downstream) of the value chain. Among the topics are the opportunity to be seen as a thought leader in circularity development, capturing customers increasingly aware of circular economy aspects by useful innovations, the access to new revenue streams through circular business models, lower costs by reducing the need for new raw materials, reducing waste and associated disposal costs, helping manage component and material shortages, or other similar factors. 40 ABB SUSTAINABILITY STATEMENT 2024 — Policy commitments to circular resource management E5-1: POLICIES ABB uses several policies and procedures to manage its impact on resource use and the circular economy. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the Sustainability Policy, the Supplier Code of Conduct and the HSES Policy. More specific policies are outlined below. Among other topics, the ABB Way outlines our Circularity Approach, our methodology to foster a circular economy. Beginning with the design stage, we are committed to increasing the resource efficiency and enhancing the reusability and recyclability of our products. We also aim to make them more durable through our lifetime extension and modernization services. Within our own operations, we avoid waste by making our processes more efficient, by increasing the use of sustainable materials in our products and packaging and by expanding recycling activities at our sites. WASTE MANAGEMENT REQUIREMENTS Our Waste Management Requirements establish the minimum health, safety and environment (HSE) requirements to be met for waste management at sites and in operations controlled by ABB. We strive to eliminate the disposal of materials into landfills. We actively seek synergies within our operations and value chain organizations to reduce waste generation, improve recycling rates and drive circularity principles like reusing as much as possible materials within our own operations and products. The Waste Management Requirements cover 14 of the 21 material IROs from our DMA, of which eight are impact- and six opportunity- related. The Waste Management Requirements apply to all employees and units of ABB worldwide, joint ventures, consortia, working partnerships, real estate and third- party service providers under ABB management. The most senior level that is accountable for the implementation of the policy is the division presidents. The Waste Management Requirements are aligned with international standards UL 2799A and ECVP 2799. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. The document is accessible to all our employees on the internal website. ZERO WASTE TO LANDFILL PROCEDURE The Zero Waste to Landfill Procedure supports our ambition to reduce the amount of manufacturing waste that is sent to landfill to zero, while we also strive to reduce our own waste generation by reusing and recycling more. Manufacturing waste includes all waste generated by our operations but excludes waste from construction and demolition. The Zero Waste to Landfill Procedure stipulates that all business areas, divisions and sites shall identify and implement objectives and targets that support reducing the amount of manufacturing waste that is sent to landfill to zero by 2030. Of the 21 IROs defined in our DMA as relevant to our circularity ambitions, nine are covered by this procedure, three of them impact- and six opportunity-related. This document applies to all employees and units of ABB worldwide, joint ventures, consortia, working partnerships, real estate and third-party service providers under ABB management control. The most senior level that is accountable for the implementation of the policy is the division presidents. The reporting of waste- related information is made in line with the requirements of the mandated environment reporting system, Intelex/SPI. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. The Zero Waste to Landfill Procedure is an internal document that is accessible via the internal network to all employees. ABB SUSTAINABILITY STATEMENT 2024 41 — Circularity-related targets E5-3: TARGETS ABB is assessing products against a set of eight KPIs in the ABB Circularity Framework, including circular design principles (in product design and serviceability), product efficiency and lifetime duration, including take-back and recycling services to increase the circularity of the materials used and reduce the use of (virgin) raw materials. We have a quantitative target of sending zero waste to landfill while reducing waste generation by 2030. We apply this approach to recycling and limiting waste generation in our operations and production processes. Targets Baseline (baseline year) 1 2023 status 2024 status PRESERVING RESOURCES Cover at least 80% of ABB’s portfolio of products and solutions with our Circularity Approach by 2030 2 n.a. The circularity score will be calculated once a representative share of the portfolio has been assessed. 3 ABB has assessed 31% of ABB’s products and solutions portfolio ABB has assessed 41% of ABB’s products and solutions portfolio Send zero waste to landfill while reducing waste generation by 2030 4 16.8 kt (2019), equivalent to 8.8% of total waste (adjusted for portfolio changes) 10.1 kt, equivalent to 6.3% of total waste 9.3 kt, equivalent to 5.8% of total waste (assured) 1 Where a baseline applies. 2 Based on revenues from hardware-based products and solutions where granularity of financial systems allows. Service revenues are excluded. 3 Against the ABB Circularity Framework KPIs. 4 Waste from demolition and construction excluded from landfill; not including hazardous waste. — Facts & figures Waste management E5-5: METRICS Total amount of waste 2024 2023 Total amount of waste generated (in t) 177,465 166,926 SASB: Percentage of recycled hazardous waste generated 60% 1 40% SASB: Number and aggregate quantity of reportable spills, quantity recovered 1 spill, 470 liters of oil, not recovered 1 spill, 350 liters of oil, not recovered Total amount of hazardous waste (in t) 6,201 5,321 Total amount of non-hazardous waste diverted from disposal (in t) 142,431 141,141 Recycling 142,431 141,141 Total amount of non-hazardous waste directed to disposal (in t) 28,834 20,465 Incineration 9,018 9,612 Landfill and other disposal operations 2 19,816 10,853 Total amount of non-recycled waste, hazardous and non-hazardous (in t) 31,326 23,656 Percentage of non-recycled waste 18% 14% Due to rounding, numbers presented may not add to the totals provided. 1 Increase due to warehouse clean-ups in several sites for electronics. 2 Includes extraordinary effect from construction projects. 42 ABB SUSTAINABILITY STATEMENT 2024 MATERIALS USED BY WEIGHT OR VOLUME (KT) For this datapoint, we follow the GRI definition. Disclosure 2024 2023 Metals (assured) 1,271 1,168 Copper 88 84 Aluminum 86 83 Steel (incl. Iron casting) 1,098 1,000 Plastics 158 136 Due to rounding, numbers presented may not add to the totals provided. Disclosure according to GRI 301: Materials 2016; voluntarily reported. ABB SUSTAINABILITY STATEMENT 2024 43 — WATER MANAGEMENT AT ABB — Water as a material topic at ABB Water management at ABB is especially relevant in areas of increased water stress. We apply our environmental management system and specific water standards to manage the associated challenges. IRO-1: PROCESSES TO IDENTIFY AND ASSESS MATERIAL IROs In the DMA carried out at ABB in 2024, the materiality of water was identified as being driven by the impact of water stress in production sites in those locations where this is an issue. Hence, the focus of the analysis was on the real or potential impact that water consumption has in areas of water risk or high water stress. The aspect of marine resources does not apply to any of our locations or activities. The DMA revealed two material actual negative impacts with regard to water, one in own operations and one in upstream value chain. One is that our production processes often require significant amounts of water, which can exacerbate water scarcity issues in regions where we operate. The other is that the extraction of metals from ores and other materials often requires substantial amounts of water to facilitate crushing, grinding and chemical processes. A lack of sufficient water treatment would have a negative impact on the environment. Among the tools we use to monitor and manage water-related risk across our operations is the World Resources Institute’s Aqueduct tool. Aqueduct lets us assess our facilities according to the level of baseline water stress of the local watershed. We use it to track levels of groundwater depletion, flood risk and seasonal variability of water availability at our sites. — Water-related policies E3-1: POLICIES ABB uses several policies and procedures to manage its impact on water. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the Sustainability Policy, Supplier Code of Conduct, and the HSES Policy. One additional specific policy is outlined below. WATER MANAGEMENT & CONSERVATION REQUIREMENTS This document establishes the minimum requirements for the management of water at ABB-controlled sites. Among other things, it stipulates that all aspects and impacts of water withdrawal and use, as well as the discharge of wastewater, shall be identified, assessed and documented in accordance with applicable regulations. It also requires that ABB units that are located in water stress areas and units with an annual water withdrawal of more than 10,000 cubic meters must have an adequate action plan for how to reduce withdrawals and water consumption has to be reduced in accordance with the action plan. These requirements are complemented by the Water Management & Conservation Approved Code of Practice (ACOP), which provides guidance and additional resources. The requirements address one of the two material impacts in relation to water. The other material impact is addressed through our Supplier Code of Conduct and through requirements related to our circularity initiatives. 44 ABB SUSTAINABILITY STATEMENT 2024 The Water Management & Conservation Requirements apply to all ABB units in all ABB legal entities. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no specific third- party standards or initiatives we commit to in respect to the implementation of this policy. Relevant internal and external stakeholders are expected to benefit indirectly from the implementation of this policy. The Water Management & Conservation Requirements are an internal document that is accessible via the internal network to all employees. — Facts & figures Water E3-4: WATER CONSUMPTION Water consumption (in m 3 ) 2024 2023 Total water consumption in areas at water risk, including areas of high water stress 283,123 Comparatives not shown unless already reported in the 2023 Sustainability report. Total annual water consumption is calculated on Group level with information from the sites, namely withdrawal and discharge. While the data on water withdrawal typically comes from direct measurements, the water discharge data is often estimated because evidence, such as invoices, is only available for specific subsets of the data. These can include, for example, documentation for industrial wastewater treatment. Partially, discharge may also occur through evaporation in industrial processes, which is not directly measured. In 2024, 100 percent of the amount of water withdrawn and 2 percent of the water discharged was based on direct measurement. For Q4 datapoints, estimates may be applied for water consumption when invoices are not available within reporting timelines. ABB SUSTAINABILITY STATEMENT 2024 45 — KEEPING POLLUTION IN CHECK — Double Materiality Assessment for pollution IRO-1: PROCESSES TO IDENTIFY AND ASSESS MATERIAL POLLUTION-RELATED IROs The 2024 DMA identified five IROs in relation to environmental pollution. Four of them are actual negative impacts, of which three are located in our own operations and one in the downstream value chain. The fifth IRO is a risk prevalent in both our own operations and in the upstream value chain. This is the potential per- and polyfluoroalkyl substances (PFAS) ban in Europe – this would create the need to source alternative materials to be used for ABB products. The four negative impacts are that (a) products sold can contribute to air pollution when they are used by customers, (b) fossil fuel use in own operations can cause air pollution, (c) improperly disposed waste or leakages can pollute soil at production sites; and (d) waste from the zinc coating process can be harmful to the environment. For the 2024 DMA process, please see chapter “Sustainability at ABB” at the beginning of this Sustainability Statement. We will include disclosures of ESRS E2 in the Sustainability Statement 2025. 46 ABB SUSTAINABILITY STATEMENT 2024 — EU TAXONOMY: DISCLOSURES FOR FINANCIAL YEAR 2024 (assured) — EU Taxonomy: Background and objectives At ABB, we are determined to shape our future in an environmentally sustainable way by developing and investing in sustainable business activities. The European Union (EU) has taken the lead in standardizing sustainability-related data and defining criteria for “environmentally sustainable” activities with the help of the EU Taxonomy Regulation, aiming to direct capital flows specifically into such activities. The EU Taxonomy categorizes “environmentally sustainable” business activities into six pre-defined environmental objectives 1 . It distinguishes between “Taxonomy-eligible” and “Taxonomy-aligned” economic activities. An economic activity is considered “eligible” if it is described in the adopted EU Taxonomy Delegated Acts. An eligible activity is only considered environmentally sustainable, and thus “aligned”, if it meets the specified technical screening criteria: • Substantial contribution to one of the   six environmental objectives • “Do no significant harm” (DNSH) to other five environmental objectives • Minimum safeguards, primarily related to human rights and social and labor standards Consequently, companies are required to publish the following KPIs: turnover, capital expenditure (CapEx) and operating expenditure (OpEx), associated with both Taxonomy-eligible and -aligned activities. EU Taxonomy is a required reporting framework for companies in its scope and the range of disclosures has been expanding annually. For the fourth year of reporting, now on the financial year 2024, the disclosure requirements have been further expanded. For the first time, EU Taxonomy eligibility and alignment must be disclosed for all economic activities under all six environmental objectives. The EU Taxonomy-related disclosures are prepared in line with Article 8 of the EU Taxonomy Regulation and the related delegated acts. The legal framework for EU Taxonomy reporting currently consists of the following elements: the EU Taxonomy Regulation, the amended Climate Delegated Act, the amended Disclosures Delegated Act, the Complementary Climate Delegated Act, and the Environmental Delegated Act, including their various annexes. In addition, the Taxonomy FAQs and Notices published by the European Commission have been taken into consideration in our disclosures, where relevant. The EU Taxonomy Regulation is a dynamic, evolving legislation. Its formulations and terms are sometimes subject to uncertainty in interpretation and require further clarification. Therefore, the following disclosures rely on our current understanding and interpretation of the Regulation; the approach applied for this year’s reporting is updated in comparison to last year and may not apply in the same way in the future. ABB has been preparing its EU Taxonomy disclosures since the financial year 2021. In 2024, we conducted a comprehensive review of our eligibility mapping to ensure accuracy, consistency and focus on performing alignment assessments for activities introduced in 2023, which are directly pertinent to our business portfolio. Additionally, it was essential to duly consider the impact of changes to pollution- related DNSH criteria, applicable for financial year 2024. These pollution-related DNSH criteria had the most significant influence on the decline in our alignment figures in 2024. 1 Climate change mitigation, climate change adaptation, sustainable use and protection of water and marine resources, transition to a circular economy, pollution prevention and control, and protection and restoration of biodiversity and ecosystem. ABB SUSTAINABILITY STATEMENT 2024 47 — ABB’s implementation of the EU Taxonomy Following the ABB Way and our decentralized operating model, we adopted a decentralized approach, involving the expertise of our product managers, real estate managers, sustainability managers, financial controllers, R&D controllers and environmental managers across all levels of our organization. Our Sustainability Council and the Finance, Audit and Compliance Committee of the Board of Directors oversee our compliance with EU Taxonomy reporting obligations and are informed of progress, potential risks and obstacles. ELIGIBILITY ASSESSMENT To determine the eligibility of our revenues, 1 we examined our global product offering in relation to the economic activities outlined by the EU Taxonomy Delegated Acts. Our revenues were mapped following the ABB product tree by business area, division, product group, product line and industry usage. Most of our eligible products and services fall under the category of “enabling activities”, which refers to economic activities that “directly enable other activities to make a substantial contribution” to one of the environmental objectives 2 . Business activities, products and solutions that do not fit into the descriptions of the EU Taxonomy Delegated Acts are classified as “non-eligible” and are therefore not included in the scope of the EU Taxonomy reporting. We guided our analysis by the descriptions of the activities, the relevant Nomenclature of Economic Activities (NACE) codes and, if necessary, the substantial contribution criteria. All ABB divisions assessed their offerings at the appropriate level of granularity to be able to determine eligibility. Our eligible CapEx was identified centrally, at the division level or at the country level. For OpEx, special attention was given to R&D expenses, which were analyzed at the division or project level. In 2024, we once again reviewed, and partially reassessed, our eligibility mapping to ensure that all changes in our portfolio are reflected. Overall, most of our activities in Electrification, Motion, Process Automation and Robotics & Discrete Automation business areas, together with our Real Estate activities, are eligible under the EU Taxonomy of “Climate Change Mitigation” (CCM). In addition, some of our activities are eligible under the objective of “Transition to a Circular Economy” (CE). The CCM Activity 3.20 “Manufacture, installation, and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution” and the CE Activity 1.2 “Manufacture of electrical and electronic equipment” are the most relevant for ABB. The table below presents the allocation of our activities to the most relevant economic activities listed in the EU Taxonomy. Changes may be made to this list in the future as additional activities relevant for ABB could be further released by the European Commission. ABB GROUP MOST RELEVANT ELIGIBLE ACTIVITIES IN ACCORDANCE WITH THE EU TAXONOMY Name of economic activity Description of economic activity ABB Group business areas and functions Environmental objective: Climate change mitigation 3. Manufacturing 3.1 Manufacture of renewable energy technologies Manufacture of renewable energy technologies Electrification Motion 3.6 Manufacture of other low- carbon technologies Manufacture of technologies aimed at substantial GHG emissions reductions in other sectors of the economy Motion Process Automation 1 The terms turnover and revenue are used interchangeably throughout the EU Taxonomy disclosures. 2 According to Article 16 of Regulation (EU) 2020/852, an economic activity shall qualify as contributing substantially to one or more of the environmental objectives “by directly enabling other activities to make a substantial contribution to one or more of those objectives, provided that such economic activity: (a) does not lead to a lock-in of assets that undermine long-term environmental goals, considering the economic lifetime of those assets; and (b) has a substantial positive environmental impact, on the basis of life-cycle considerations.” 48 ABB SUSTAINABILITY STATEMENT 2024 Name of economic activity Description of economic activity ABB Group business areas and functions 3.19 Manufacture of rail rolling stock constituents Manufacture, installation, technical consulting, retrofitting, upgrade, repair, maintenance, and repurposing of products, equipment, systems, and software related to the rail constituents Electrification Motion 3.20 Manufacture, installation, and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution that result in or enable a substantial contribution to climate change mitigation The economic activity develops, manufactures, installs, maintains or services electrical products, equipment or systems, or software aimed at substantial GHG emission reductions in high, medium and low voltage electrical transmission and distribution systems through electrification, energy efficiency, integration of renewable energy or efficient power conversion Electrification Motion Process Automation E-Mobility 6. Transport 6.16 Infrastructure enabling low- carbon   water transport Construction, modernization, operation and maintenance of infrastructure that is required for zero tailpipe CO 2 e operation of vessels or the port’s own operations, as well as infrastructure dedicated to transshipment Electrification Process Automation 7. Construction and real estate 7.6 Installation, maintenance, and repair of renewable energy technologies Installation, maintenance and repair of renewable energy technologies, on-site Electrification Real Estate 7.7 Acquisition and ownership of buildings Buying real estate and exercising ownership of that real estate Real Estate Environmental objective: Transition to a circular economy 1. Manufacturing 1.2 Manufacture of electrical and electronic equipment Manufacturing of electrical and electronic equipment for industrial, professional and consumer use Motion Process Automation 5. Services 5.1 Repair, refurbishment and remanufacturing Repair, refurbishment and remanufacturing of goods that have been used for their intended purpose before by a customer (physical person or legal person) Electrification Motion Process Automation Robotics & Discrete Automation 5.2 Sale of spare parts Sale of spare parts Electrification Motion Robotics & Discrete Automation SUBSTANTIAL CONTRIBUTION ASSESSMENT Following the eligibility assessment, a thorough alignment assessment of each identified eligible activity was conducted to determine fulfillment of the technical screening criteria. In 2024, the eligible activities that were added in 2023 were for the first time assessed for alignment, as dictated by the EU Taxonomy Regulation. ABB SUSTAINABILITY STATEMENT 2024 49 In the first step of the alignment assessment, it was analyzed whether the identified activities fulfill the substantial contribution criteria spelled out in the respective Delegated Acts. This assessment was completed for our products and solutions, our real estate, our fleet and R&D activities at the Group, business area, division and site levels, as appropriate. The criteria for substantial contribution vary significantly across different activities. We used several different assessment methods and scopes to determine whether these criteria were met. For the activities most relevant to ABB: • CCM Activity 3.20 : The substantial contribution requirements related to the inclusion of specific types of equipment were considered to some extent already during our eligibility screening; we assessed applicable energy efficiency classes, and we excluded revenues from products used in fossil fuel industries, as well as switchgear containing SF 6 • CE Activity 1.2 : It was currently not possible to demonstrate full compliance with the comprehensive substantial contribution criteria, resulting in no aligned products under this activity Based on our substantial contribution assessment and before considering the DNSH criteria, the main activities where ABB made a substantial contribution in 2024 are the following: • CCM 3.1 Manufacture of renewable energy technologies • CCM 3.19 Manufacture of rail rolling stock constituents • CCM 3.20 Manufacture, installation, and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution that result in or enable a substantial contribution to climate change mitigation • CCM 6.16 Infrastructure enabling low carbon water transport • CCM 7.7 Acquisition and ownership of buildings DO NO SIGNIFICANT HARM (DNSH) ASSESSMENT Activities identified as significantly contributing to an environmental objective were subsequently evaluated for compliance with the DNSH criteria. This assessment was conducted at the product, site and company levels, depending on the criteria. As previously noted, with the expansion of the EU Taxonomy's scope of activities, the coverage of the DNSH assessment has correspondingly broadened in 2024. Additionally, some of the assessment methodologies and interpretations have been revised this year to reflect our evolving understanding of the requirements. Due to the distinct nature of various DNSH criteria, the alignment assessment concerning pollution (Appendix C) was performed within a dedicated workstream focused on the product level, independent of the evaluation of other DNSH requirements. The introduction of new criteria related to “other substances” was the primary factor behind the decline in our alignment results. Below, we set out our current interpretation and describe the main analyses conducted. 1. CLIMATE CHANGE ADAPTATION We conducted an evaluation of the pertinent physical climate risks and carried out an initial climate risk and vulnerability assessment to determine which manufacturing sites may be impacted by these risks over their expected lifetimes. As required by the EU Taxonomy (Appendix A), the analyses of climate risk and vulnerability were based on Representative Concentration Pathway (RCP) scenarios 4.5 and 8.5 extending up to the year 2052. We assessed the impact of the identified climate risks on economic activities and explored potential adaptation solutions to mitigate these risks. 50 ABB SUSTAINABILITY STATEMENT 2024 2. SUSTAINABLE USE AND PROTECTION OF   WATER AND MARINE RESOURCES As required by the EU Taxonomy, generic DNSH criteria on water (Appendix B), we assessed our water impact from the perspective of water quality preservation and water stress avoidance, by translating these generic criteria into more concrete, measurable data requirements. On top of this, many of our sites within this scope are certified according to ISO 14001 environmental management systems and ISO 9001 quality management systems. Activity-specific DNSH criteria are evaluated at the activity level. The relevance of the criteria is determined by the nature of our activities and products, along with their associated impacts. 3. TRANSITION TO A CIRCULAR ECONOMY ABB takes a company-wide approach to circularity. Therefore, for DNSH related to circular economy we leverage from the ABB Circularity Approach and our company- wide policies related to sustainable material content in sourcing, circular design principles and our “zero waste to landfill” targets. Certain requirements related to construction and demolition waste are considered not applicable to ABB, as such activities typically do not fall within the scope of our operations. 4. POLLUTION PREVENTION AND CONTROL The generic DNSH criteria related to pollution prevention (Appendix C) require that the economic activity does not lead to the production, placing on the market or use of chemical substances listed in a variety of EU chemical regulations and directives, including the EU Directive 2011/65 on the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment (RoHS) and the EU Regulation 1907/2006 concerning the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH). Generally, this analysis would need to be conducted at product level. ABB has robust company-wide processes and material compliance systems in place to ensure compliance with all applicable regulatory requirements, especially RoHS and REACH. However, the Appendix C requirements pose several challenges, particularly due to differences with applicable sectoral legislation. Furthermore, an additional requirement has been introduced to Appendix C – applicable for financial year 2024 – to address “other substances”, which is subject to interpretation. Given our vast product portfolio, it is challenging to assess all potentially relevant substances for “suitable alternatives” within the given short timeframe. We have initiated an evaluation of our products against the Appendix C requirements; however, we are presently unable to reliably assert fulfillment of these requirements for the relevant products. Due to our business profile, most of our eligible activities necessitate adherence to Appendix C. This effectively precludes most of our revenue from alignment in 2024. 5. PROTECTION AND RESTORATION OF BIODIVERSITY AND ECOSYSTEMS We performed dedicated biodiversity assessments for all our EU and non-EU sites in scope of the generic DNSH requirements on biodiversity (Appendix D). Relevant sites in or near biodiversity-sensitive areas were identified and analyzed. In general, sites already in operation at EU locations have already received necessary permits from the respective national authorities, which are in charge of enforcing all relevant applicable laws. For non-EU sites, an analysis was performed to map EU directives to the corresponding relevant national equivalent, as required by Appendix D. Non-EU sites in countries with equivalent national laws have also received necessary permits from the respective authorities which oversee the enforcement of those laws, where applicable to our activities. ABB SUSTAINABILITY STATEMENT 2024 51 6. CLIMATE CHANGE MITIGATION In 2024, we were required for the first time to assess the DNSH criteria for climate change mitigation for activities under the objective of Circular Economy. The primary requirement stipulates that in cases of on-site generation of heat/cool or co-generation including power, the direct GHG emissions must be lower than 270 gCO 2 e/kWh. These criteria were evaluated at the site level, utilizing ABB's scope 1 reporting. MINIMUM SAFEGUARDS The Minimum Safeguards are based on Article 18 of the EU Taxonomy Regulation and require compliance with principles laid down by the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises (OECD Guidelines), the UN Guiding Principles on Business and Human Rights (UNGPs), the eight fundamental conventions of the International Labour Organization (ILO) on Fundamental Principles and Rights at Work, and the International Bill of Human Rights. In 2024, we have refreshed our assessment to demonstrate compliance with the Minimum Safeguards. Our assessment covers nine areas: 1) human rights policies, 2) human rights due diligence & risk assessment, 3) addressing human rights impacts, 4) human rights communication, 5) grievance mechanisms, 6) consumer interests, 7) anti-corruption, 8) competition and 9) taxation. For further information, please refer to the relevant chapters on “Sustainability at ABB” and “Social information” of this Statement. — EU Taxonomy KPI calculation ABB FINANCIAL AND NON-FINANCIAL REPORTING ABB prepares its consolidated financial statements under U.S. GAAP, while the EU Taxonomy Regulation references KPI disclosures in accordance with IFRS. The two standards are largely converged, with the following key difference: • Non-order related R&D is expensed as incurred under U.S. GAAP and reported as part of the OpEx KPI. Most other differences in revenue recognition, tangible and intangible assets, and leases are minor, with no significant impact on data comparability. Below is a summary of our EU Taxonomy eligibility and alignment KPI calculations, including figures and comparable information from 2023. The KPIs for year-end 2024 were calculated using financial data available on December 31, 2024. TURNOVER KPI The proportion of Taxonomy-eligible and/or -aligned turnover has been calculated as the part of net turnover derived from products and services associated with Taxonomy-eligible and/or -aligned economic activities (numerator) divided by net turnover (denominator) for the financial year ended December 31, 2024. The denominator is the Group’s net turnover as presented in the Consolidated Income Statements under the line item “Total revenues,” in accordance with U.S. GAAP. To calculate the numerator, we used the activity mapping described above and identified all third-party revenues associated with the Taxonomy-eligible and/or -aligned activities. For the year ended December 31, 2024, 44 percent of our revenues are eligible under the objective of Climate Change Mitigation (CCM). Additionally, 10 percent of our revenues are eligible under the objective of Transition to Circular Economy (CE). The aligned revenue reported under both CCM and CE activities is negligible, resulting in the alignment figure being rounded to 0 percent. The contribution of our business activities was calculated and reported under one economic activity, without double counting. 52 ABB SUSTAINABILITY STATEMENT 2024 In comparison, in 2023, 46 percent of our revenues were Taxonomy-eligible, and 6 percent of our revenues were Taxonomy-aligned. Against this background, most of our Taxonomy-eligible turnover is reported under: • CCM 3.20 Manufacture, installation, and servicing of high, medium, and low voltage electrical equipment for electrical transmission and distribution, • CE 1.2 Manufacture of electrical and electronic equipment, and • CCM 3.6 Manufacture of other low-carbon technologies. The expansion of the EU Taxonomy scope had already been reflected in last year’s eligibility results. Consequently, the slight year-on-year variations in eligibility are attributed to further refinements in our eligibility mapping process. While the EU Taxonomy now has more activities relevant to our business model compared to prior years, a significant portion of our business activities continues to fall outside the scope of the EU Taxonomy. The notable decrease in EU Taxonomy-aligned turnover from 2023 to 2024 is attributed to the currently unmet pollution-related criteria (Appendix C). The details of the turnover KPI and breakdowns are provided on page 91 of the Sustainability Statement. CAPEX KPI The CapEx KPI is defined as Taxonomy-eligible and/or -aligned CapEx (numerator) divided by total CapEx (denominator) for the financial year ended December 31, 2024. According to the EU Taxonomy definition, ABB’s total CapEx includes: • Total additions to tangible and intangible assets before depreciation, amortization, revaluations and impairments, which are included in the Capital expenditures as presented in Note 24 “Operating segment and geographic data” of the Financial Report 2024. • Leases (finance and operating), where corresponding values are derived from our internal reporting systems but are not directly reconcilable with the figures presented in Note 16 “Leases” that only discloses the additional operating lease for the reporting period and does not include finance lease. • Assets acquired as part of business combinations, where corresponding values are derived from our internal reporting systems but are not directly reconcilable with the figures presented in the consolidated Financial Report 2024. In the numerator, Taxonomy-eligible or -aligned CapEx includes CapEx related to assets or processes associated with eligible or aligned EU Taxonomy activities, and CapEx related to the purchase of output for eligible or aligned activities and individual measures. ABB did not consider “CapEx plans” in 2024. The numerator calculation was performed in two steps: 1. Relevant real estate initiatives and large investments were analyzed on a case-by-case basis and are directly mapped to the relevant EU Taxonomy activities by our business areas and divisions. Investments are reported under the EU Taxonomy activity with which this specific CapEx is associated. Aligned CapEx is calculated based on a dedicated alignment assessment for those investments, conducted by ABB’s global real estate function. 2. All remaining CapEx additions are allocated per division based on the percentage of eligible and aligned revenue-generating EU Taxonomy activities. For the year ended December 31, 2024, 38 percent of our CapEx are eligible, and 1 percent of our CapEx are aligned under the objective of Climate Change Mitigation (CCM). Additionally, 5 percent are eligible and 0 percent aligned under the objective of Circular Economy (CE). ABB SUSTAINABILITY STATEMENT 2024 53 In comparison, in 2023, 64 percent of our CapEx were eligible, and 8 percent of our CapEx were aligned. Against this background, most of our Taxonomy-eligible CapEx is reported under: • CCM 3.20 Manufacture, installation and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution, • CCM 7.7 Acquisition and ownership of buildings, and • CE 1.2 Manufacture of electrical and electronic equipment. Aligned CapEx is primarily related to individual measures and purchase of output from EU Taxonomy activities, with most of our aligned CapEx being reported under: • CCM 7.7 Acquisition and ownership of buildings, and • CCM 7.6 Installation, maintenance and repair of renewable energy technologies. As in the previous year, CCM 7.7 “Acquisition and ownership of buildings” accounts for the biggest portion of CapEx eligibility in ABB’s real estate portfolio. The difference between Taxonomy-eligible and -aligned CapEx is primarily due to challenges in applying EU Energy Performance of Buildings Directive to our global real estate portfolio outside of the EU and energy certificates not meeting the Substantial Contribution criteria for energy efficiency of buildings. The difference between Taxonomy-aligned CapEx 2024 and Taxonomy-aligned CapEx 2023 is mainly driven by the lack of aligned revenue which negatively affects the aligned CapEx share determined by the revenue allocation key. The details of the CapEx KPI and breakdowns are provided on page 94 of the Sustainability Statement. OPEX KPI The OpEx KPI is defined as Taxonomy-eligible and/or -aligned OpEx (numerator) divided by total OpEx (denominator) for the financial year ended December 31, 2024. According to the EU Taxonomy definition, the total OpEx used for the denominator consists of direct non-capitalized costs related to R&D, short-term leases (less than one year), repairs and maintenance, building renovation measures, and any other direct expenditures associated with the day-to-day servicing of assets including property, plant and equipment. Following this definition and our accounting policy, our total OpEx includes: • R&D costs, derived from the line item “Non-Order related research and development expenses” in the Consolidated Income Statements of the Financial Report 2024, • “Other OpEx”, where corresponding values are derived from our internal reporting systems but are not directly reconcilable with the figures presented in the Consolidated Income Statements. Expenses related to building renovation projects would be capitalized under U.S. GAAP and, therefore, are out of scope of the OpEx KPI. Following the revenue allocation key approach, for the year ended December 31, 2024, 42 percent of OpEx are eligible under the objective of Climate Change Mitigation (CCM) and 9 percent under the objective of Circular Economy (CE). Under both objectives, 0 percent of OpEx are aligned. In comparison, in 2023, 45 percent of our OpEx were Taxonomy-eligible and 6 percent were Taxonomy-aligned. 54 ABB SUSTAINABILITY STATEMENT 2024 The process of collecting data for eligible and aligned OpEx varies between R&D expenses and other relevant expenses (i.e., “other OpEx”). For R&D, the process is as follows: • ABB invests substantial efforts in developing SF 6 -free alternatives, which are particularly relevant for achieving alignment for the activity CCM 3.20. Therefore, where specifically attributable to such projects, R&D expenses were allocated to the activity CCM 3.20. • The rest of the R&D expenses are allocated to Taxonomy-eligible activities identified based on the activity eligibility mapping described above . For other OpEx, the revenue allocation key was used. These expenses were considered for each division and multiplied by the percentage of eligible and aligned revenue in that division. This approach was necessary due to a lack of more granular data on the same basis as described above for the CapEx KPI. With this process, we ensured there was no double counting for the OpEx KPI. Most of our Taxonomy-eligible OpEx is reported under: • CCM 3.20 Manufacture, installation and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution, • CE 1.2 Manufacture of electrical and electronic equipment, and • CCM 3.6 Manufacture of other low-carbon technologies. The variation and difference of Taxonomy-eligible and -aligned OpEx between 2024 and 2023 are correlated with the Taxonomy-eligible and -aligned turnover as OpEx values are mainly driven by the applied product group revenue allocation key. The details of the OpEx KPI and breakdowns are provided on page 98 of the Sustainability Statement. 2024 ABB ASSESSMENT RESULTS UNDER THE EU TAXONOMY: TURNOVER, CAPEX, OPEX KPIs Turnover 54% eligible 46% non-eligible 0% aligned 100% non-aligned Capital Expenditure 44% eligible 56% non-eligible 1% aligned 99% non-aligned Operating Expenditure 51% eligible 49% non-eligible 0% aligned 100% non-aligned ABB SUSTAINABILITY STATEMENT 2024 55 — Outlook ABB welcomes the significant progress made over the past years in expanding the EU Taxonomy to include many critical activities, such as manufacturing of electrical equipment, which are essential for advancing a resilient, electrified and decarbonized energy system. This expansion is an important step toward aligning sustainable activities with the needs of the energy transition. Nonetheless, the usability and practicability of the EU Taxonomy requirements could be further improved. Differences in criteria between the EU Taxonomy and existing applicable sectoral legislation currently creates technical difficulties in achieving EU Taxonomy alignment. 02 SOCIAL INFORMATION 57 Responsibility for our employees 68 Social protection in the value chain 73 Protecting vulnerable communities 76 Protecting consumers ABB SUSTAINABILITY STATEMENT 2024 57 — RESPONSIBILITY FOR OUR EMPLOYEES — Employees contribution to Sustainability Agenda As an employer, ABB respects and promotes human rights and dignity, striving to create safe, fair and inclusive working environments where our people can thrive. It is our aim that our success translates into success for all our stakeholders and has a positive impact on society and the environment. The employee-related topics that we regard as material to our business and how it impacts the outside world comprise health and safety, human rights and labor standards, employee development, and wellbeing. As part of our Sustainability Agenda, we also focus on diversity, equity and inclusion as well as partnerships and collaboration. SBM-2: CONSULTATION OF EMPLOYEES At ABB, we engage with our employees as one of our pivotal stakeholder groups. In an ongoing dialogue and in close cooperation, we aim to ensure that our policies and positions reflect their perspectives. This communication informs which topics are material for both ABB and our stakeholders. We maintain an open dialogue with current, former and future employees. These include formalized and/or elected bodies of employee representatives. Our forms of engagement include the following: • Annual Employee Engagement Survey • Annual performance review • Collective bargaining associations • Dialogue with the ABB Employees Council Europe, the representative body of all ABB employees in Europe • Global network of employee resource groups promoting diversity, equity and inclusion in the workplace • Learning and development opportunities — Identification of material IROs SBM-3: MATERIAL IMPACTS, RISKS AND OPPORTUNITIES In 2024, we performed a DMA to identify material IROs for our own workforce that may result from working at ABB. The analysis revealed 21 IROs. Given the topic of ‘own workforce’, these were all located in our own operations, not in our value chain. Twelve of them were categorized as impacts, two as risks and seven as opportunities. All impacts, positive or negative, were in the fields of either equal opportunities or working conditions. ( Potentially) Positive impacts : Seven of the twelve impacts were identified as positive or potentially positive, four related to equal opportunities and three to working conditions. They can be summarized as impacting our workforce by a strong diversity program, learning and development opportunities, and rigorous safety trainings. Our diversity initiatives ensure equal opportunities. We prioritize robust health and safety measures to minimize risks. We also offer employment opportunities for individuals in the local community, contributing to economic development. By implementing policies promoting gender diversity, equity and inclusion within the workforce, we aim to ensure equal opportunities for women. Furthermore, by providing secure employment, decent working times, adequate wages, social dialogue including works councils, collective bargaining, and participation rights, we have a positive impact on the wellbeing of our employees. 58 ABB SUSTAINABILITY STATEMENT 2024 ( Potentially) Negative impacts: Three impacts were considered negative and two potentially negative. These potential impacts are related to individual incidents. In certain operations, female employees are less likely to achieve promotion, which could result in gender inequality in senior management and at operational levels. Challenges like workload during peak working periods affect work-life balance. Potentially, safety incidents, violation of labor rights or unethical treatment of staff may have a negative impact on employees. Risks and Opportunities : The two identified risks are in the compliance area relating to equal opportunities and cybersecurity. Of the seven opportunities, five are connected to equal opportunities and two to working conditions. Not acting on these topics would lead to risks through loss of talent, reputational damage or even sanctions and fines. — Own workforce- related targets S1-5: TARGETS Targets Baseline (baseline year) 2023 status 2024 status (assured) SOCIAL PROGRESS Zero harm to our people and contractors – we aim for a gradual reduction in lost time from incidents 0.24 (2019) 1 0.13 0.15 Increase proportion of women in senior management roles to 25% by 2030 11.7% (2019) 21.00% 21.30% Achieve a top-tier employee engagement score 71/100 (2019) 77/100 78/100 1 2019 baseline excludes the Power Grids business and the Turbocharging division. — Employee-related policies S1-1: POLICIES ABB uses several policies and procedures to manage its impact on own employees. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the ABB Code of Conduct, the Human Rights Policy & Human Rights Due Diligence Framework and the HSES Policy. More specific policies are outlined below. WELLBEING AND RESILIENCE REQUIREMENTS ABB’s Wellbeing and Resilience Requirements provide for the health, safety and wellbeing of employees and the prevention of work-related ill health. Of our 21 material IROs in this field, this policy addresses four with connection to health and wellbeing. This policy applies worldwide to all ABB controlled sites. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no specific third-party standards or initiatives referenced in this document. Our employees are expected to benefit from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. ABB SUSTAINABILITY STATEMENT 2024 59 DIVERSITY, EQUITY AND INCLUSION POLICY ABB’s Diversity, Equity and Inclusion (DEI) Policy sets out the core elements of DEI practices within the ABB Group. It outlines the mandatory minimum standard by defining what is core within the area of DEI. To secure a sustainable, diverse workforce, all business areas, divisions and functions are required to adhere to our DEI strategy and its related targets and activities. These are intended to guide our decisions, increase awareness and ensure focus. The policy covers all 11 of our equal opportunity-related IROs. This policy applies to employees in all businesses, divisions, and functions within the ABB Group. The most senior level that is accountable for the implementation of the policy is the division presidents.There are no specific third-party standards or initiatives referenced in this document. Our employees are expected to benefit from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. CORPORATE PEOPLE DEVELOPMENT POLICY Our approach to people development is a key part of our People 2025 strategy and is underpinned by this Corporate People Development Policy. It sets forth the central features of the people development practices that apply to all employees in our business areas and functions. It outlines mandatory minimum standards for each of our human resources focus areas: Employee Engagement, the Open Job Market, and our Learn, Connect, Grow approach: • The Employee Engagement survey is an annual tool for employee feedback. We also conduct targeted pulse surveys on specific topics. • The Open Job Market framework applies to every business area and function. It mandates that all non-production positions be posted in English on our internal career portal and establishes that any employee can apply for any posted job. • Our Learn, Connect, Grow approach seeks to create an environment that fosters the development of all our employees. As part of this approach, we provide online and offline trainings on interpersonal and leadership skills, career development resources and opportunities for our people to connect and learn from each other, including a feedback framework. Of the 21 IROs identified for the area of own employees, this policy covers three (two impacts, one opportunity). This policy applies to all employees in ABB business areas and functions worldwide. Accountability for implementing the policy lies with the division presidents. There are no specific third-party standards or initiatives referenced in this policy. Our employees are expected to benefit from the implementation of this policy. The policy is an internal document that is accessible via the internal network to all employees. OTHER HUMAN RIGHTS RELATED POLICIES For human rights policy commitments including labor rights of value chain workers, engaging with own workforce, and the provision of remedy for human rights impacts, see the policy descriptions above and in the Sustainability at ABB chapter, in particular, for the Code of Conduct and the Human Rights Policy with Human Rights Due Diligence Framework. The policies with regard to our own workforce are aligned with relevant internationally recognized instruments, including the UN Guiding Principles on Business and Human Rights. For the workplace accident prevention policy and management system in place, see HSES Policy and HSES management system descriptions above. 60 ABB SUSTAINABILITY STATEMENT 2024 ABB’s Code of Conduct and the Human Rights Policy are policies that collectively frame ABB’s approach on (a) discrimination, including harassment, promoting equal opportunities, and other ways to advance diversity, equity and inclusion, (b) grounds for discrimination such as racial and ethnic origin, color, sex, sexual orientation, gender identity, disability, age, religion, political opinion, national extraction or social origin, or other forms of discrimination, (c) commitments related to inclusion or positive action for people from groups at particular risk of vulnerability in its own workforce; and (d) the prevention and mitigation of discrimination once detected, as well as to advance diversity, equity and inclusion in general. — Employee involvement in decision-making processes S1-2: PROCESSES FOR ENGAGING ABOUT IMPACTS ABB EMPLOYEE ENGAGEMENT SURVEY The ABB Employee Engagement Survey is conducted Group-wide on an annual basis and all employees are invited to participate. We cooperate with local works councils and union representatives to ensure that the survey meets local consultation requirements. It is available in approximately 40 languages and participation is entirely voluntary and confidential. We also carry out business- or topic-specific pulse surveys. These surveys provide employees with an opportunity to express their views about ABB as a workplace. The survey invites active employees, excluding short-term roles (e.g., externals, students, interns, casuals) and those on garden leave without email access. Exceptions align with local labor laws or HR leadership approvals. E-mobility employees are excluded due to separate governance and a tailored listening strategy under development. Listening to feedback from our employees mitigates the risk of failing to address critical topics at the team and business levels. We share the global survey results with employees, summarizing our overall engagement score and the most notable strengths and areas for improvement. Our business areas, divisions, country organizations and relevant teams discuss the feedback. By listening regularly to feedback from our employees, we mitigate the risk of failing to address critical topics at the team and business levels. Failure to deal with such issues could lead to less motivated employees and to avoidable attrition. Over the past six years, the participation rate for the survey has continuously improved, from a response rate of 65 percent in 2019 to 85 percent in 2024. To evaluate our overall progress, we track on our Sustainability Agenda target “Achieve a top-tier employee engagement score.” This engagement score has improved from 71 in 2019 to 78 in 2024. The score is the key survey metric that we track from year to year. In essence, it reflects the answers given by our employees to two core questions: “How happy are you working at ABB?” and “Would you recommend ABB as a great place to work?” In 2024, all but six topics improved compared to the previous year, with no declines. “Safety,” “integrity” and “role clarity” remained the top-rated areas, while “development” showed the most progress. Despite improvements since 2019 in removing barriers to execution, opportunities for further enhancement remain. In 2024, a decision was made to benchmark against the top 25 percent of global organizations using the same engagement platform. ABB SUSTAINABILITY STATEMENT 2024 61 SAFEGUARDING HUMAN RIGHTS ABB supports and respects the international frameworks on human rights, as set out in our Human Rights Policy. With respect to labor, these frameworks and standards also include those which the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-Affected Areas and Child Labor (DDTrO) specifies as internationally recognized equivalent regulations. As a result of our adherence with these frameworks and standards, we are exempted from specific due diligence and reporting obligations under the provisions of the amended Swiss Code of Obligations (Art. 964j–l CO) and the DDTrO respectively with regard to child labor. With respect to labor standards, ABB honors their requirements, whether determined by law or by collective bargaining agreements. This includes the EU directive on minimum notice periods regarding operational changes. We have a voluntary agreement with the European Works Council (EWC) to consult on any planned transnational changes in Europe that affect a large number of employees before beginning labor relations processes within affected countries. Whenever possible, we await the EWC statement before concluding any local labor relations process. In this confidential exchange with the EWC about planned future changes and our business outlook, we also review the effectiveness and efficiency of our consultation processes and adjust our practices when needed. Via our Global Labor Relations database, we ensure that we comply with local requirements and manage engagement processes for more complex projects. POSITIVE IMPACT THROUGH EMPLOYEE WELLBEING AND BENEFITS In providing employee benefits, including wellbeing benefits, our general policy is to align with local market practices on a country-by-country basis. There is a risk that local market practices may not support our Sustainability Agenda or our goal to drive social progress. Thus, in two wellbeing-related areas we take a global rather than local approach to benefits: the global paid parental leave policy and the global Employee Assistance Program (EAP). Under the EAP, our global provider offers the same level of wellbeing support to all our employees. All employees can access the EAP through our Inside+ intranet site or through an external website, as not all eligible participants have access to Inside+. This is primarily the case for our production workers and the dependents of our employees. We also comply with local legislation. Our EAP provides a Rapid Response Critical Incident service that addresses urgent negative impacts and risks related to employee wellbeing. The service supports employees affected by incidents such as natural disasters, accidents at work or the death of a colleague. DIVERSITY, EQUITY & INCLUSION: INVOLVING VULNERABLE GROUPS DEI at ABB involves developing and supporting workforce diversity across all dimensions (e.g., gender, generations, ethnicity, abilities, sexual orientation) and providing all with equal opportunities and equal treatment. We seek to cultivate an inclusive environment that welcomes and respects every individual. We have guidelines to promote DEI across ABB, such as the DEI Policy. Our Code of Conduct (CoC) additionally sets forth how we expect employees to act in matters of inclusion, respect and fairness. Under the CoC, employees are expected to help keep our workplace free of harassment and discrimination. Among our commitments to DEI, we have: • re-signed the CEO statement of support for the UN Women’s Empowerment Principles (WEPs); • launched a DEI Policy that reinforces our global accountability and commitment on inclusion; and • expanded the scope of EC sponsorship to involve all EC members. We also support the Standards of Conduct for Business as set forth by the United Nations (UN). 62 ABB SUSTAINABILITY STATEMENT 2024 Our four business areas and their divisions are accountable for translating our global DEI strategy into action in all our markets. — Channels available to raise concerns S1-3: PROCESSES AND CHANNELS TO RAISE CONCERNS Our reporting and allegation management processes are available to internal and external stakeholders to address any potential violations of our Code of Conduct or other policies as well as applicable laws, including matters relating to human rights. In case of any violation of human rights or our CoC, we take steps to ensure adequate remediation and consequences in line with applicable contracts and laws. Reports can be made by internal stakeholders either directly to ABB managers or members of the legal team or via our Business Ethics Helpline. The reporting channels allow reports to be made anonymously, and the availability of such channels as well as details on how to access them are regularly highlighted in training sessions, as is the ability for users to remain anonymous when making such reports. For more information see the whistleblowing section in the chapter “Good business conduct” (G1-2: Policies). In 2024, we did not receive any reports of child labor with respect to our employees. Also, we did not receive any reported incidents regarding indigenous peoples’ rights or of negative impacts caused by security staff or third-party security providers. Our reporting and allegation management includes data on reported incidents of misbehavior including categories such as HSE and security, human resources and other integrity issues (as well as more detailed subcategories within these) to ensure appropriate attention, resourcing and internal escalation. For more details, see section “Anti-corruption and anti-bribery” in the chapter “Good business conduct”. — Employee-related action S1-4: ACTION RELATED TO EMPLOYEE WELLBEING Programs and initiatives at both the Group and local levels deliver a range of programs designed to create a positive impact on employee wellbeing. Our well-established global Employee Assistance Program (EAP) offers a wide range of programs for employees, including a Rapid Response Critical Incident service that addresses urgent negative impacts and risks related to employee wellbeing. The service supports our employees affected by incidents such as natural disasters, accidents at work or the death of a colleague. It helps us to track utilization rates to rapidly identify areas where early intervention measures would help. In addition, in 2024, we launched a global wellbeing application for line managers to support building individual resilience and to encourage the creation of an inclusive work environment from a mental health perspective. We also run global wellbeing campaigns like the World Mental Health Day. These global programs are complemented by other actions conducted on a local basis. For example, in the US, we provide Health Advocacy and Family Building support, including mental health resources. In Italy, “ABB walking groups” promote regular guided walks, while in China, employees benefit from health check-ups and doctor consultations. ABB SUSTAINABILITY STATEMENT 2024 63 HEALTH AND SAFETY-RELATED ACTION The divisions of our four business areas undergo one-, three- or five-year self- assessment cycles under the HSES management system and submit to HSE audit. Independent HSE auditors are responsible for identifying areas for improvement. We also track the effectiveness of our health- and safety-related actions. Our management information system allows us to gather data on hazards and incidents and assign actions to managers. Each division is encouraged to develop safety programs that are appropriate for their operations. We coordinate preparations and responses to emergency situations, conduct internal safety inspections and obtain third-party verifications for our health, safety and wellbeing reporting. We have well-defined procedures to investigate work-related injuries and incidents and act promptly to mitigate negative impacts. We continuously strive to further reduce health and safety hazards. HUMAN RIGHTS-RELATED ACTION Our goal is for human rights to be well understood and managed in all our operations. In 2024, we continued our work to strengthen our human rights due diligence across ABB’s entire value chain, as well as implementing the roadmap that was updated in 2023, following up on business areas risks analysis and identified salient issues. We revised our human rights training offer, developing new virtual training modules targeting sales, operations and procurement functions, as well as new deep dive modules aligned with the salient issues. We have published the new Human Rights Requirements and ACOP to enhance human rights due diligence in ABB operations. This initiative will be followed up by a new wave of site assessments to ensure execution of defined requirements. PEOPLE DEVELOPMENT ACTION We believe that a culture that consistently allows employees to reflect on their growth objectives and provides them with the support they need to achieve them, through an open job market, learning opportunities and human connections, both prepares our workforce for challenges and safeguards their employability. We have created leadership courses that address specific challenges in our organization. Additional leadership learning resources are available to our employees through the Harvard Manage Mentor and Harvard Manage Mentor Spark platforms. Training opportunities are also provided by our businesses to their respective employee populations. In 2024, a series of manager webinars and dedicated webinars tailored to employees’ specific personas were introduced. We refine our learning offerings to keep them up to date, working with our internal stakeholders. In 2024, our Learn Connect and Grow Day engaged over 30,000 participants across more than 40 countries. DIVERSITY, EQUITY & INCLUSION-RELATED ACTION Among the DEI-related activities in 2024, we celebrated Women’s History Month with the global theme #InspireInclusion. We hosted global virtual events featuring our leadership team, who shared their insights and commitment to fostering inclusion both at work and in the broader community. Our Employee Resource Group (ERG) Encompass Women also offered a range of activities, including panel discussions and the organization of an event on returning to work after giving birth. 64 ABB SUSTAINABILITY STATEMENT 2024 The World Day of Cultural Diversity was celebrated, and we launched Pride Month in a campaign that sparked Group-wide engagement on LGBTQ+ topics. Highlights featured an “Ally of the Year” award and learning-oriented contests. Over 6,800 participants joined the global and local events, including production sites. In 2024, we focused on solidifying the systemic changes made in policies and employee benefits to ensure a fair and inclusive workplace for all and established a new ERG in India. External assessments on LGBTQ+ inclusion were used to track progress and identify areas for improvement. Advocacy events were hosted in Poland and Switzerland. Furthermore, we marked International Women in Engineering Day by highlighting stories of women engineers and their contributions. We marked World Youth Skills Day at ABB by showcasing inspiring stories and programs. International Youth Day was marked alongside Jürgen Dormann Foundation Day by welcoming a cohort of young professionals to Zurich to meet leaders. “MeQ,” a dedicated application for line managers, was rolled out as a tool for psychological safety and accommodation to all employees. Working groups were formed to understand the needs of accommodation, accessibility and diverse talent acquisition. In November, our new DEI Policy went live. Our partnerships on DEI include Catalyst, WeQual, the Society of Women Engineers, WorkplacePride Open for Business and the Global Summit of Women. INTEGRITY-RELATED ACTION TO PROTECT EMPLOYEES With regard to integrity, we have updated our country policies for anti-bullying, anti-discrimination and grievances in all our key jurisdictions to reflect current legal standards and our commitment to a workplace that encourages a “speak-up” culture. We have also introduced new guidance for social events. We have strengthened our investigation and remediation processes to ensure consistent and effective case and consequence management. These processes provide for a zero-tolerance approach to discrimination and harassment. Additional resources have been provided for investigating and responding to complaints about poor workplace behaviors, including frameworks and procedures governing our workplace behavior investigative and disciplinary decision-making processes. TRACKING THE EFFECTIVENESS OF OUR APPROACH To track the effectiveness of our actions in support of DEI, we track metrics including the inclusion score in the annual employee Engagement Survey, data on the growth of ABB-affiliated ERGs, the proportion of employees receiving DEI training and our early talent and leadership statistics. We have set four DEI targets to achieve by 2030. One is to increase the proportion of women in senior management roles to 25 percent. In 2024, the proportion of female senior managers increased to 21.3 percent, up from 21.0 percent in 2023. Further details on processes for engaging with our own workforce can be found in the section on stakeholder dialogue in the chapter “Sustainability at ABB” at the beginning of this Sustainability Statement. ABB SUSTAINABILITY STATEMENT 2024 65 — Facts & figures Own employees S1-6: EMPLOYEE STATISTICS ABB reports employees by headcount, counting each individual with an employment contract and being on the payroll of an ABB company, regardless of work percentage (e.g., 0.5 FTE counts as one). This approach highlights the human impact in sustainability KPIs but differs from financial reporting, which uses FTE calculations to align with efficiency metrics. As a result, employee numbers may vary between the Sustainability Statement and the Financial Report. Headcount by region Region 2024 2023 Europe 53,597 52,723 The Americas 27,210 26,437 Asia, Middle East and Africa 31,962 31,282 Total 112,769 110,442 Average 112,280 Comparatives not shown unless already reported in the 2023 Sustainability report. Headcount by gender Gender Number of employees (headcount) 2024 2023 Male 81,407 79,798 Female 31,361 30,644 Other — Not reported 1 Total Employees 112,769 110,442 Comparatives not shown unless already reported in the 2023 Sustainability report. Countries where ABB has at least 50 employees representing at least 10 percent of the total number of employees Country Number of employees (headcount) Average number of employees USA 14,127 13,837 China 12,523 12,549 Turnover rate 2024 2023 Total number of employees who left during the reporting period 15,538 Rate of employee turnover during the reporting period 14% 15% Comparatives not shown unless already reported in the 2023 Sustainability report. 66 ABB SUSTAINABILITY STATEMENT 2024 S1-9: DIVERSITY METRICS Number Percentage Gender (top management) 2024 2023 2024 2023 Male 410 78.7% 79.0% Female 111 21.3% 21.0% Comparatives not shown unless already reported in the 2023 Sustainability report. The gender distribution in percentage of employees at top management level is calculated by dividing the number of female active employees at top management level based on dominant position and headcount, excluding externals, by the number of active employees (headcount, male and female) at top management level. For this calculation, the dominant position is defined as the role where an employee spends the highest percentage of their time, as recorded in the HR Group Tool, in cases where an individual holds multiple roles. At ABB, top management level is considering Hays grades 1–7, including division presidents. Division presidents have grades A, B, C and have previously been included in grades 3-6. Gender is considered as a person’s legal sex rather than gender identity, due to HR system constraints. Percentage Age (all employees) 2024 2023 Under 30 20% 30-50 55% > 50 25% Comparatives not shown unless already reported in the 2023 Sustainability report. S1-14: HEALTH AND SAFETY METRICS Employees Non-Employees Other workers 2024 2023 2024 2023 2024 2023 The percentage of people covered by ABB’s health and safety management 100% 100% Number of fatalities as a result of work-related injuries 2 — — — — 1 Number of work-related accidents 320 18 Rate of work-related accidents 1.46 1.46 Number of cases of recordable work-related ill health 8 — Number of days lost to work- related injuries, accidents, ill health 3,824 196 Comparatives not shown unless already reported in the 2023 Sustainability report. Lost-time injury frequency rate (LTIFR) 2024 (assured) 2023 Lost-time injury frequency rate (LTIFR) 0.15 0.13 For the calculation of the LTIFR, we used the following formula (for 200,000 hours): (number of lost time workplace-related incidents , total employees and contractors,200,000)/employee and contractor total hours worked. ABB SUSTAINABILITY STATEMENT 2024 67 S1-17: DISCRIMINATION AND HARASSMENT INCIDENTS Number of reported incidents of discrimination and harassment in 2024 All reported incidents Discrimination and harassment incidents reported 515 To identify discrimination and harassment incidents, ABB relied on its current reported incident categorizations, which were designed to capture the broad range of incidents that personnel may raise related to discrimination, harassment, and bullying, and as such they may capture a broader range of incidents than discrimination and harassment based on protected characteristics set out in our Code of Coduct. ABB is considering potential refinements to its reported incident categorizations to facilitate more precise reporting of ABB's incidents in future reporting periods. In 2024, we report the number of harassment and discrimination incidents received during 2024 without regards to levels of substantiation. The 2023 calculation reflected discrimination and harassment incidents that were logged as meeting substantiation thresholds in place in 2023. In 2024, no severe human rights incidents connected to our workforce have occurred. 68 ABB SUSTAINABILITY STATEMENT 2024 — SOCIAL PROTECTION IN THE VALUE CHAIN — Involvement of value chain workers The employees of our suppliers and service providers contribute their share to ABB’s sustainability value proposition and benefit from protection against risks associated with their work for us. The ESRS wording “Workers in the value chain” as an element of sustainability reporting refers to the employees of our value chain partners and how we involve them in our sustainability management. The objective is to ensure that they contribute to ABB’s sustainability targets and to protect them from any potentially negative impacts of the work they do as part of the ABB value chain. SBM-3: MATERIAL IROs AND THEIR INTERACTION WITH STRATEGY AND BUSINESS MODEL The type of workers in our entire upstream and downstream value chain is diverse. It can include workers in raw materials and minerals extraction and processing, employees in factories, contractors at sites and workers in logistics and distribution. These different groups of workers might also include workers from vulnerable groups, such as migrant workers, young people or women. ABB is committed to support and respect human rights and labor standards, and to comply with internationally recognized standards, laws and regulations, including the elimination of modern slavery and child labor, as well as the right to work under fair and safe conditions. It encompasses access to fair wages, the right to freedom of association and collective bargaining, and respecting the rights of communities and individuals when providing security for people and assets. We also recognize our responsibility to promote an organizational culture that supports human rights and to respect and promote human and labor rights along our value chain. This includes assessing and monitoring any human rights risks that customers, suppliers, business partners and other parties directly linked to ABB operations, products and services might present. In our value chain, there is a potential risk of negative impacts on individuals, including the risk of modern slavery and child labor. In addition, health and safety risks can occur in mining, when workers face unsafe conditions. Chemicals and heavy machinery usage in upstream processes can also pose health risks to workers. To make ABB’s IROs better understood, we performed a DMA in 2024. The DMA identified 16 IROs, of which 15 were impacts and one an opportunity. No material risk was identified. Eight IROs were identified in the upstream value chain, three in the downstream, and five in both. The opportunity is also in the upstream value chain and refers to the improvement of human rights due diligence through the use of software tools that help to improve compliance by verifying a company’s performance in this area before becoming an ABB supplier. ABB SUSTAINABILITY STATEMENT 2024 69 Of the 15 impacts, 10 were regarded as actually positive, two as actually negative, and three as potentially negative. The actually positive impacts include programs to counteract workers losing jobs due to automation, ABB’s position against violence and harassment across the value chain, fostering a physically and mentally safe environment with positive working conditions. Our Sustainable Supply Base Management (SSBM) Program, audits and assessments, our active membership of the Responsible Minerals Initiative, alongside our complaint system for value chain workers and associated policies and trainings, demonstrate our commitment to the safety and wellbeing of all individuals in our value chain and foster the positive impact on value chain workers. Negative impacts identified include the fact that physical work in raw material extraction (such as mining) can expose workers to unhealthy and dangerous working conditions. The same upstream processes can expose workers to instances of modern slavery, human trafficking or child labor. — Supplier-related policies S2-1: POLICIES ABB uses several policies and procedures to manage its impact on workers in the value chain. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the ABB Supplier Code of Conduct, and the Human Rights Policy & Human Rights Due Diligence Framework. More specific policies are outlined below. SUSTAINABLE SUPPLY BASE MANAGEMENT REQUIREMENT The SSBM program is our way to verify compliance with the Supplier Code of Conduct and to fulfill the company’s legal due diligence obligations. This document establishes our minimum requirements to be met for the SSBM program, unless legislation and/or local regulations impose a higher standard, in which case that higher standard shall be followed. The SSBM program requires our divisions to verify the sustainability compliance of new suppliers. Besides, they shall perform supplier assessments following a five-year cycle to ensure compliance with the requirements. Divisions are required to ensure the implementation of the SSBM within their organization and to allocate sufficient budget to it, including training for suppliers. This document is complemented by the Sustainable Supply Base Management ACOP (see below). Of the 16 IROs defined in this field, 12 from across all defined areas are covered by this policy. The SSBM Requirement applies to all external suppliers. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no specific third-party standards or initiatives referenced in this policy. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. This is an internal document that is accessible via the internal network to all employees. SUSTAINABLE SUPPLY BASE MANAGEMENT ACOP Our Sustainable Supply Base Management Approved Code of Practice (ACOP) provides practical advice and guidance on the approved and recommended methods to ensure that our operations comply with the ABB Way. The ACOP addresses 12 of the 16 IROs identified in this field across all areas. This policy determines the coverage of the SSBM program and its targets, KPIs and the external reporting requirements. Furthermore, it lays out the detailed program approach. There is a description of the audit process, and the country-specific assessment is explained in detail. 70 ABB SUSTAINABILITY STATEMENT 2024 This ACOP is applicable to all suppliers, including direct and raw material suppliers, indirect materials and services suppliers, as well as transport, trade and logistics suppliers. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no specific third-party standards or initiatives referenced in this policy. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. This ACOP is an internal document that is accessible via the internal network for all employees. ABB POLICY ON CONFLICT MINERALS Responsibly sourcing conflict minerals and other minerals of concern is part of our responsible sourcing commitment. This is also reflected in the ABB Policy on Conflict Minerals. We have established a Conflict Minerals Program based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas, and other international standards. Within this program, we continue our work to understand and limit our exposure to conflict minerals (tantalum, tin, tungsten, and gold, or “3TG”), as defined by Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and EU Directive 2017/821. We request information from our suppliers on the source of these minerals and other minerals of concern, such as cobalt, and work with them to avoid sourcing from smelters or refiners (SORs) in the covered countries (the Democratic Republic of the Congo and neighboring countries) and conflict-affected and high-risk areas (CAHRAs), other than those that have implemented OECD-aligned programs. We actively work with our suppliers to ensure that any minerals contained in the products and materials supplied to ABB originate from conflict-free sources and to transition away from smelters and refiners that have been defined as high-risk. This is a globally applicable policy that addresses both internal (purchasing departments) and external stakeholders (suppliers). The most senior level that is accountable for the implementation of the policy is the division presidents. The policy is based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. This policy is publicly available on ABB’s corporate website for our internal and external stakeholders including suppliers and business partners. It is also available on our internal communications channels. FURTHER HUMAN RIGHTS COMMITMENTS For human rights policy commitments including labor rights of value chain workers and the provision of remedy for human rights impacts, see policy descriptions above and at the end of the chapter “Sustainability at ABB”, in particular for the Human Rights Policy & Human Rights Due Diligence Framework. The themes of trafficking in human beings, forced labor, compulsory labor and child labor are all addressed in the ABB Supplier Code of Conduct. In 2024, four concerns of this nature relating to supply chain providers were identified. Two remain under review, and two concerns were not substantiated. We support and respect the principles contained within the UN Guiding Principles on Business and Human Rights (UNGPs), the OECD Guidelines for Multinational Enterprises and the 10 principles of the United Nations Global Compact (UNGC) on Human Rights, Labor, Environment and Anti-Corruption, as well as applicable laws and principles in the areas of human rights and decent work. Our Supplier Code of Conduct is based on, among other international standards, the International Bill of Human Rights, the UNGPs, the International Labour Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work, the United Nations Global Compact (UNGC), the Rio Declaration on Environment and Development, the UN Convention Against Corruption, the Convention on Biological Diversity, the UN Framework Convention on Climate Change (UNFCCC), the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal, the Stockholm Convention on Persistent Organic Pollutants (POPs) and the Minamata Convention on Mercury. ABB SUSTAINABILITY STATEMENT 2024 71 With respect to child labor, these frameworks and standards include those which the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-Affected Areas and Child Labor (DDTrO) specifies as internationally recognized equivalent regulations. As a result of our adherence with these frameworks and standards, we are exempted from specific due diligence and reporting obligations under the provisions of the Swiss Code of Obligations (Art. 964j–l CO) and the DDTrO respectively with regard to child labor. — Engaging with value chain workers S2-2: ENGAGING ABOUT IMPACTS To address human rights risks related to our suppliers, we rely on our SSBM program and our responsible minerals management program (see chapter “Good business conduct”). We aim for trusting and stable relationships with the entities that provide products and services to ABB, including equipment and human resources. Depending on the concrete subject and initiative, we engage directly with workers in the value chain or with legitimate representatives or through their employers by: • monitoring through our SSBM program, • on-site evaluations and audits, • procurement management, • providing training and engaging in special projects on sustainability performance, • town hall and supplier day events. The perspective of value chain workers, gathered through the various engagement mechanisms are systematically integrated into the development of action plans and the management of identified actual and potential impacts. A specific example are the worker interviews, conducted as part of the SSBM program. If any discrepancies are identified with the requirements of our Supplier Code of Conduct or with local legislation, such as excessive work in overtime, not providing the right personal protective equipment for personnel or other labor rights violations, the supplier is required to create a Corrective and Preventive Action Plan to solve the non-compliance within agreed timelines. We work directly with Tier 1 and some Tier 2 suppliers. Via the Responsible Minerals Initiative, of which we are an active member, we reach suppliers in the upper part of our supply chain, typically Tier 4-6 suppliers. Interactions happen with different frequencies, depending on the topic, the type of supplier and tier in the supply chain. We will explore options to further increase visibility beyond Tier 1. Our engagement with value chain workers is governed by our Human Rights Policy and Due Diligence Framework. The SSBM program is how we conduct this due diligence in our supply chain. Division presidents are accountable for executing this program. 72 ABB SUSTAINABILITY STATEMENT 2024 — Channels to raise concerns S2-3: REPORTING COMPLAINTS Our reporting and allegation management processes are available to internal and external stakeholders to address violations of our Code of Conduct, the Supplier Code of Conduct or other ABB policies, as well as applicable laws, including matters relating to human rights. In case of violation of human rights or our (Supplier) Code of Conduct, we take steps to apply remediation and consequences in line with applicable contracts and laws. The Supplier Code of Conduct explains the procedure and links to the integrity portal on our website, which includes various reporting channels. Reports are received and processed by an independent service provider, who forwards the report to a dedicated investigations team within the Legal & Integrity function at ABB headquarters or, in EU countries where required by law, to a local representative of the chosen ABB partner company. All reports are subject to appropriate review and are brought to closure using systematic processes and tracking. ABB SUSTAINABILITY STATEMENT 2024 73 — PROTECTING VULNERABLE COMMUNITIES — Impacts and opportunities SBM-3: MATERIAL IROS AND INTERACTION WITH STRATEGY AND BUSINESS MODEL ABB's activities impact communities along its value chain. These communities consist of people living or working in the vicinity directly impacted by our operations as well as those affected indirectly through our value chain, irrespective of the distance between these communities and our operations. ABB’s DMA revealed eight IROs in the communities field, of which one was an opportunity, four were potentially negative impacts and three were actual positive impacts. There were no material risks identified. Potentially negative impacts can arise through environmental pollution and operation or transportation nuisances. Some minerals in our products, such as cobalt, gold, tin, tantalum and tungsten have a high likelihood of being sourced from conflict-affected and high-risk areas. These activities are mainly related to our upstream value chain. We also contribute to positive impacts on communities, by creating local economic value. Forming partnerships with aligned companies and stakeholders enables us to grow as a company, which also benefits our upstream and downstream value chains. — Community-related targets S3-5: TARGETS Targets Baseline 2023 status 2024 status (assured) SOCIAL PROGRESS Expand programs for community engagement n.a. As part of the improvement process started in 2022, in 2023 we assessed our community engagement positioning and revised and expanded the scope of action, now focused on education, emergency and disaster relief, community empowerment, and environment and conservation. In 2024, we release internal guideline t formalize the company’s commu engagement strat and provide direct on developing pro aligned with our Sustainability Agen and our Four Focu Areas (4Es) of intervention. 74 ABB SUSTAINABILITY STATEMENT 2024 — Community-related policies S3-1: POLICIES ABB uses several policies and procedures to manage its impact on affected communities. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the Sustainability Policy, the ABB Code of Conduct and Supplier Code of Conduct, and the Human Rights Policy & Human Rights Due Diligence Framework. One more specific policy is outlined below. ABB POLICY ON CONFLICT MINERALS Responsibly sourcing so-called conflict minerals and other minerals of concern is part of our responsible sourcing commitment. This is also reflected in the ABB Policy on Conflict Minerals. We have established a Conflict Minerals Program based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas and other international standards. Within this program, we try to understand and limit our exposure to conflict minerals (tantalum, tin, tungsten and gold), as defined by Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and EU Directive 2017/821. We request information from our suppliers on the source of these minerals and work with them to avoid sourcing from smelters or refiners (SORs) in the covered countries and conflict-affected and high-risk areas, other than those that have implemented OECD-aligned programs. This is a globally applicable policy that addresses both internal (purchasing departments) and external stakeholders (suppliers). The most senior level that is accountable for the implementation of the policy is the division presidents. The policy is based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. This policy is publicly available on ABB’s corporate website for our internal and external stakeholders including suppliers and business partners. It is also available on our internal communications channels. FURTHER HUMAN RIGHTS COMMITMENTS Both the ABB Human Rights Policy & Human Rights Due Diligence Framework and the ABB Policy on Conflict Minerals focus specifically on human rights aspects and have been developed on the basis of internationally acknowledged frameworks such as the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas and the UN Guiding Principles on Business and Human Rights. These policies are designed to protect communities broadly, with indigenous peoples recognized as an essential part of those they aim to support, even if not explicitly mentioned. With respect to child labor, the international frameworks and standards referenced in the aforementioned ABB policies include those which the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict- Affected Areas and Child Labor (DDTrO) specifies as internationally recognized equivalent regulations. As a result of our adherence with these frameworks and standards, we are exempted from specific due diligence and reporting obligations under the provisions of the Swiss Code of Obligations (Art. 964j–l CO) and the DDTrO respectively with regard to child labor. ABB SUSTAINABILITY STATEMENT 2024 75 — Addressing potential violations S3-3: CHANNELS AVAILABLE TO RAISE CONCERNS Our reporting and allegation management processes are available to internal and external stakeholders to address any potential violations of our Code of Conduct, the Supplier Code of Conduct or other ABB policies, as well as applicable laws, including matters relating to human rights. In case of any violation of human rights or our (Supplier) Code of Conduct, we take steps to ensure adequate remediation and consequences in line with applicable contracts and laws. The Supplier Code of Conduct explains the procedure and links to the integrity portal on our website, which includes various reporting channels. Reports are received and processed by an independent service provider who forwards the report to a dedicated investigations team within the Legal & Integrity function at ABB headquarters or, in EU countries where required by law, to a local representative of the chosen ABB partner company. All reports are subject to appropriate review and are brought to full closure using systematic processes and tracking systems. 76 ABB SUSTAINABILITY STATEMENT 2024 — PROTECTING CONSUMERS SBM-3: MATERIAL IROs AND THEIR INTERACTION WITH STRATEGY AND BUSINESS Working primarily with industrial customers, ABB has only limited direct or indirect touchpoints with consumers. — Management of consumer-related risks When analyzing our material IROs in the course of the 2024 DMA, we identified eight IROs in the consumer and end-user field. Of these, four were impacts and four risks. All four impacts were located in the downstream value chain. Two of them were identified as actually positive. Consumers and end-users benefit from our focus on privacy and our aim to provide a transparent and ethical approach to data handling. This commitment enhances customer satisfaction, loyalty and brand perception. Also, providing access to quality information empowers consumers and end-users to make informed decisions, leading to better choices and confidence in the product and value chain involved. The other two impacts were assessed as possibly negative. Both are safety related, when safety incidents with our products lead to health accidents or when product misuse impacts “vulnerable” users. Strong safety measures for the use-phase of our products and clear instructions can mitigate the risk of safety incidents for customers. The four risks primarily arise within the upstream and downstream value chains, with one also directly impacting our own operations. For instance, in the e-mobility sector, when ABB products are connected to low-quality, non-ABB chargers, it poses challenges to our reputation and reliability, highlighting the importance of maintaining high standards across all touchpoints. Risks related to information security in the value chain include potential external attacks with ransomware when an incident is not discovered or remediated in a timely manner or if cyber- attacks result in significant loss claims by customers. — Consumer-related policies S4-1: HUMAN RIGHTS POLICY AND DUE DILIGENCE FRAMEWORK The ABB Human Rights Policy endeavors to ensure that all of our stakeholders including consumers and end-users are treated with respect and fairness at all times. With regard to consumers and end-users affected, the human rights issues that are covered by this policy include: • Environmental issues impacting human rights • Health and safety • Information security and data privacy The policy and the associated Human Rights Due Diligence Framework are described at the end of the chapter “Sustainability at ABB”. POLICY IN DEVELOPMENT ABB is in the process of developing a specific consumer-related procedure, which will address the material IROs outlined above. It was not yet completed by the end of the reporting year. ABB SUSTAINABILITY STATEMENT 2024 77 — Processes and channels for raising concerns S4-3: PROCESSES CHANNELS TO RAISE CONCERNS ABB’s reporting and allegation management processes are available to internal and external stakeholders to address any potential violations of ABB’s Code of Conduct or other policies, as well as applicable laws, including matters relating to human rights. In case of any violation of human rights or our Code of Conduct, we take steps to ensure adequate remediation and consequences in line with applicable contracts and laws. Reports are received and processed by an independent service provider who forwards the report to a dedicated investigations team within the Legal & Integrity function at ABB headquarters or, in EU countries where required by law, to a local representative of the chosen ABB partner company. All reports are subject to appropriate review and are brought to full closure using systematic processes and tracking systems. 03 GOVERNANCE INFORMATION 79 Good business conduct ABB SUSTAINABILITY STATEMENT 2024 79 — GOOD BUSINESS CONDUCT ABB’s Sustainability Agenda is underpinned by a culture of integrity and transparency that we aim to embed across the value chain. We see integrity as part of our license to operate and we are committed to the highest standards of ethical business conduct and professional behavior. GOV-1: ROLE OF THE ADMINISTRATIVE, SUPERVISORY AND MANAGEMENT BODIES — Ethical business practices At ABB, we are working to maintain ethical business practices and systematic risk management that addresses environmental, social and legal risks. For us, ethical business behavior and good governance as well as transparency and integrity, are critical in our commitment to anti-corruption, fair competition and compliance with legal obligations within ABB and towards stakeholders. Another vital component of our approach to corporate and sustainability governance is our regular review of the relevant processes as well as thorough due diligence. We take care to disclose our tax practices and corresponding payments and to design responsible and fair remuneration practices. We are always seeking new ways to enhance our sustainability governance structure so that sustainability is given appropriate consideration at all levels, from the Board of Directors to the operating departments. MANAGEMENT ROLES IN MATTERS OF BUSINESS CONDUCT Our management and corporate governance structure play a pivotal role in ensuring ethical behavior, integrity and compliance with laws and regulations across all business interactions and operations. The Board of Directors holds ultimate accountability for compliance and integrity matters in accordance with Swiss law and other relevant laws and regulations. The Finance, Audit and Compliance Committee of the Board of Directors supports the Board by overseeing the Group’s adherence to legal and regulatory requirements, providing oversight of the integrity program and reviewing material changes to policies related to integrity. The Chief Integrity Officer, reporting directly to the Group General Counsel, is responsible for implementing, managing and continuously enhancing our integrity program. This includes overseeing the evaluation and design of policies and procedures, resources, learning and communications, and related controls. Other integrity and business conduct-related enterprise level controls are managed in collaboration with the Group General Counsel and management, including a focus on the top-down commitment of senior and middle managers to the integrity program and Code of Conduct. This comprehensive governance framework allows us to align with best practices in ethical business conduct and professional behavior. Our administrative, management and supervisory bodies possess extensive expertise in business conduct matters, ensuring robust governance and compliance across the organization. The Board of Directors includes members with diverse backgrounds in business management and cultural experience, enabling them to apply informed judgment on ethical behavior, integrity and anti- corruption governance. 80 ABB SUSTAINABILITY STATEMENT 2024 The FACC is composed of individuals with high-level expertise in overseeing compliance with legal and regulatory requirements. The Group General Counsel, who has accountability for ABB’s legal function, works closely with the Chief Integrity Officer to support our integrity and regulatory affairs compliance efforts. The Chief Integrity Officer, appointed in consultation with the Group Executive Committee and the FACC, leads the day-to-day oversight of compliance with applicable laws and our integrity program. Additionally, the Heads of Integrity in respect of each business area provide strategic leadership on legal and integrity matters to the businesses, ensuring that our integrity and compliance risks are effectively managed from Group level down into each business area. Each of the Heads of Integrity are familiar with the different activities and functions of their own business area, together with their business colleagues, and therefore possess the requisite knowledge of their own products and customers to effectively manage and address business conduct risk. This collective expertise ensures that our administrative, management and supervisory bodies are well-equipped to adhere to best practice in ethical business conduct. — Materiality IRO-1: DETERMINATION OF MATERIAL TOPICS We manage and report on sustainability for many years and have a solid approach to governing the topic. To ensure alignment with the CSRD and ESRS, we performed a DMA in 2024. For more information on the process, see the chapter “Sustainability at ABB”. Our 2024 DMA revealed 15 material IROs in the business conduct field. Of these, 11 have been categorized as impacts, one as a risk and three as opportunities. Our business conduct impacts, rooted in corporate governance and ethical practices, are vital for our social license to operate and sustainable growth. Ethical business conduct, transparency, prevention of corruption and bribery, a strong whistleblower system and regulatory compliance are key. Because these fall mainly in our own management responsibility, seven of our 11 identified impacts are located in our own operations, the other four in the upstream or downstream value chains. As we have a robust system of ethical standards, policies and management systems, our DMA has identified these impacts mainly as actually positive (five) or potentially positive (one) and only one as an actually negative impact. This latter IRO is our management of supplier relationships: there would be a negative impact on the environment if we had no consideration of environmental criteria in our material sourcing. A lapse such as this could lead to legal risks, financial penalties and brand damage. The potentially positive impacts relate to, for example, the benefit for our stakeholders of behaviors at ABB that support transparent and sustainable business practices, or mandatory compliance trainings aimed at preventing corruption and bribery, or tax payments used by governments to fund public infrastructure and public services. A positive impact on our value chain is, for example, that our due diligence and risk management framework reduces the risk of misconduct. The one risk identified in the 2024 DMA concerns our own operations. It relates to employees not following the ethical guidelines of our ABB Way, which may lead to new integrity cases and potentially serious financial and reputational exposure, blacklisting or loss of business opportunities. Our integrity culture needs to be promoted especially among managers and gatekeeper roles (finance, supply chain management) and in some geographic areas. ABB SUSTAINABILITY STATEMENT 2024 81 Our opportunities build on transparency and ethics that can build trust, combat corruption and limit financial risks, contributing to a better world. Internally, our competitive salary structure serves the better availability of talented employees, so that work is done well and on time. Thus, we can hope for lower costs for recruiting new employees, deploying temporary staff and absenteeism. — Business conduct- related policies G1-1: CORPORATE CULTURE AND BUSINESS CONDUCT POLICIES ABB uses several policies and procedures to manage its business conduct. Some of them are overarching documents that apply to more than one topical chapter of this Sustainability Statement. These can be found at the end of the chapter “Sustainability at ABB” and include the ABB Way, the Sustainability Policy, the Code of Conduct, the Supplier Code of Conduct and the ABB Human Rights Policy & Human Rights Due Diligence Framework. More specific policies are outlined below. SUSTAINABILITY RISK MANAGEMENT POLICY The Sustainability Risk Management Policy outlines the key principles we apply to manage sustainability risks. Among other things, it aims to: • support the delivery of our Sustainability Agenda through proactive risk management of sustainability risks across the value chain and build organizational resilience to withstand and adapt to sustainability-related disruptions and challenges; • provide an overview over how sustainability risks are managed across the Group to support the achievement of strategic and business objectives; • offer consistent terminology within the scope of sustainability risk management based on environmental, social and governance risk definitions; • support compliance with various sustainability risk management regulatory requirements such as the ESRS; and • outline key governance as well as roles and responsibilities over the management of sustainability risks. This policy addresses four of the 15 IROs relevant to business conduct, in particular those that refer to environmental risks including the value chain. The policy is mandatory for the entire ABB Group and therefore applies to all legal entities, sites and businesses, including joint ventures, consortia, working partnerships and third-party service providers under our management control. It applies across all business areas, divisions and corporate functions. The most senior level that is accountable for the implementation of the policy is the division presidents. There are no third-party standards referred to in this policy. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. It is an internal policy that is accessible to all employees via the internal network. SUSTAINABILITY REPORTING POLICY The objective of the Sustainability Reporting Policy is to establish the rules, requirements, roles and responsibilities related to sustainability reporting to enhance the transparency and credibility of our sustainability performance. It also describes the implementation approach to ensure we can provide accurate and consistent sustainability information to our stakeholders. The policy stipulates that all sustainability data published in ABB’s Sustainability Statement adhere to the minimum reporting principles in alignment with ESRS, namely relevance, faithful representation, comparability and consistency, verifiability, and understandability. It explains the sustainability reporting governance at ABB and gives details about the roles and responsibilities involved in the reporting process. This policy does not address any IROs in the business conduct field. 82 ABB SUSTAINABILITY STATEMENT 2024 This policy is mandatory for the entire ABB Group, therefore applies to all employees and all legal entities of the Group, joint ventures, consortia, working partnerships, leased assets, entities under operational control and third-party service providers under our management control. The scope of this policy covers the disclosures required by regulatory requirements as well as those related to the Sustainability Agenda and voluntary standards to which we have committed. The most senior level that is accountable for the implementation of the policy is the division presidents. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. It is an internal policy that is accessible to all employees via the internal network. ABB POLICY ON CONFLICT MINERALS To ensure that our products do not contain so-called conflict minerals which have been sourced from mines that support or fund conflict within the Democratic Republic of Congo or adjoining countries, we have implemented a Policy on Conflict Minerals. In partnership with our suppliers, we are committed to using in our products only tin, tungsten, tantalum or gold that have been legally and ethically sourced. The policy addresses mainly the impact-related IROs among the 15 material IROs in this field and those relating to the upstream value chain. The policy applies to all ABB employees and suppliers. The most senior level that is accountable for the implementation of the policy is the division presidents. With this policy, ABB complies with section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. It is also based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas and other appropriate international standards. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. This policy is a public document and therefore accessible to all internal and external stakeholders via the internet. TAX POLICY As part of our commitment to the highest standards of corporate governance and responsibility, we apply great care to the management of tax affairs, which is outlined in our Tax Policy. Our approach is to comply with the letter and the spirit of applicable tax laws and regulations in the countries where we operate. The Tax Policy outlines the role of the tax function at ABB and explains our Tax Control Framework. It covers one of the 15 IROs in the business conduct field (contributing with a positive impact to local economy). The related ABB Tax Control Framework follows a yearly structured approach with respect to how tax risks are identified, managed and monitored. The policy applies to all ABB companies and employees dealing with tax matters. The most senior level that is accountable for the implementation of the policy is the Chief Financial Officer. Relevant internal and external stakeholders are expected to benefit from the implementation of this policy. This policy is a public document and is therefore accessible to all internal and external stakeholders via the internet. ABB SUSTAINABILITY STATEMENT 2024 83 WHISTLEBLOWING AND REPORTING CHANNELS All ABB employees, contractors, suppliers, customers and other stakeholders are strongly encouraged to promptly and in good faith report any concerns of possible improper conduct, breaches of the law, and/or the Code of Conduct or other ABB policies. There are a number of channels that allow stakeholders to report integrity concerns or other behavior that may be in contradiction of our Code of Conduct. Such channels allow reports to be made anonymously or otherwise, without fear of retaliation. The process is designed to protect the confidentiality of reporters and the reporting and resolution process. Reports can be made by internal stakeholders either directly to ABB managers or members of the Legal & Integrity team or via the ABB Business Ethics Helpline. The Helpline is also accessible to external stakeholders. We have robust reporting and allegation management processes in place to investigate incidents reported into our Business Ethics Helpline, including those related to corruption and bribery, promptly, independently and objectively. These procedures are in accordance with EU Directive 2019/1937. We established a dedicated specialist investigations team known as the Integrity Investigations and Monitoring (IIM) team. This team is responsible for carrying out thorough investigations into the highest-risk business conduct reported incidents, ensuring that all reports are handled with appropriate confidentiality and protections, as well as overall administration of the company Business Ethics Helpline. We have additional dedicated investigations teams in each business area responsible for other workplace and business conduct reported incidents. We have a commitment to non-retaliation in relation to whistleblowing and employ a real-time case dashboard to ensure continuous monitoring of Business Ethics Helpline reported incidents. BUSINESS CONDUCT TRAINING Our integrity training program is designed to ensure that all employees are familiar with and capable of conforming to our Code of Conduct and ethical standards. During onboarding, all employees are given access to these trainings and are required to complete a core set of business conduct-related trainings focussed on the Code of Conduct as well as disclose any potential conflicts of interest. All employees have access to the training program, and there is a specific focus on those in customer-facing roles such as Sales and Procurement, as well as gatekeeper functions like Legal and Finance. The training is comprehensive and continuously updated, offering over 130 micro-learnings, bespoke content and short videos some of which are available in multiple languages. We employ a hybrid learning approach that includes both self-driven and mandatory learnings, supplemented by face-to-face sessions for targeted audiences. Employees are encouraged to engage in continuous self-learning, with the training content tailored to the specific risks relevant to their roles. This approach ensures that employees are not only completing the training but are also applying the knowledge in their daily tasks. Additionally, we conduct regular global communications and micro-learnings about culture, behavior expectations and resources, including monthly sharing of internal integrity successes and failures. This continuous learning strategy is underpinned by employee accountability and fraud prevention awareness, fostering a culture of integrity and ethical conduct within the organization. 84 ABB SUSTAINABILITY STATEMENT 2024 — Management of supplier relationships G1-2: MANAGEMENT OF RELATIONSHIPS WITH SUPPLIERS ABB’s Supplier Code of Conduct (SCoC) complements the ABB Code of Conduct. It sets forth our requirements for suppliers. The SCoC is in line with relevant international frameworks, standards and legislation governing ethical and sustainable business practices. The SCoC’s section on “Human rights and decent work” includes specific requirements regarding child labor, modern slavery, harassment, discrimination and diversity, as well as the rights of local communities and vulnerable groups. There is also a separate section entitled “Climate and environment” and a list of potential environmental impacts on the part of suppliers. The SCoC requires suppliers to disseminate and enforce similar requirements across their own supply chains and to report any suspected violations. In 2024, we provided high-level awareness training on the updated SCoC to selected suppliers, followed by deep dive training for employees covering different SCoC topics. In 2025, we will provide deep dive training to our suppliers. To further mitigate risks, our category management strategies include generic category risk controls, additional risk controls for geopolitical issues, material compliance changes, critical parts and material shortages. We have also implemented single-source risk management strategies. Suppliers in scope of risk management will be uploaded in our risk management tool and closely monitored. As part of our supply chain GHG emissions reduction program, we have requested our most impactful suppliers to register in EcoVadis and get a validated scorecard. This will not only provide information on their approach and maturity related to carbon management, but also covers their performance in environment, labor and human rights, ethics and sustainable procurement. BEYOND AUDITS Our Sustainable Supply Base Management (SSBM) program, which addresses sustainability topics and performance at each stage of the supplier life cycle, forms part of our “Beyond Audit” approach. With the SSBM program we integrate sustainability principles into our supplier selection and qualification processes and continuously monitor suppliers during their life cycle with us. Through the program, we address topics including: human rights and decent work, health and safety, climate and environment, business ethics, business and information security, procurement, as well as report any concerns in these areas and provide access to remediation approaches. Employee interviews are an integral element of our on-site audits and assessments. The approach is further backed by risk-based monitoring that covers a broad range of suppliers and incorporates Group-wide standards and targets. The management and implementation of the SSBM program is handled by ABB’s business areas. The program is governed by a steering committee comprised of representatives from business areas and the corporate sustainability team and a working group comprised of representatives from all our divisions. Under the SSBM program, new suppliers must complete a self-assessment. Depending on the results, further due diligence is carried out. In 2024, we have updated the Country Specific Protocol, used for extensive assessment of existing suppliers in focus countries, to be aligned with the updated SCoC. New criteria include assessment of supplier performance in avoiding harassment, protecting local communities, executing human rights and labor rights risk assessments, performing GHG emissions and energy management, water management, and other resource management and reporting on concerns. As part of our yearly risk review process, we have updated the list of focus countries to reflect both the changed composition of the ABB supplier base and changes in country risk levels. We also reviewed our portfolio of sourced materials and parts and have updated our commodity risk matrix. ABB SUSTAINABILITY STATEMENT 2024 85 After adjusting the SSBM Country Specific Protocol in 2023 to permit assessments of temporary labor suppliers, we continued with pilots in multiple countries. U pon carrying out audits in one pilot country in 2023, we found evidence that local labor laws were not being observed. In alignment with the ABB Human Rights Due Diligence Framework and the ABB Supplier Code of Conduct, we worked with the supplier to ensure understanding of ABB requirements, and to define and implement corrective actions. In 2024, the case was internally escalated, and a decision was taken to compensate all supplier’s impacted employees linked to ABB operations and to terminate the relationship with the supplier. To prevent or further mitigate potential negative impacts and risks related to our supply chain, we conducted a few pilot assessments at Tier 2 suppliers. We will continue with this pilot in 2025. As reported in 2023, engagement with stakeholders at internal awareness training sessions on human rights and labor rights brought to light additional concerns related to temporary laborers at certain ABB sites. One of the cases was not substantiated. Another case resulted in supplier termination after internal escalation. KPIs USED TO MEASURE PERFORMANCE Targets Baseline 2023 status 2024 status INTEGRITY AND TRANSPARENCY At least 80% of supply spending in focus countries 1 covered by Sustainable Supply Base Management (SSBM) by 2030 n.a. Using a risk-based approach, a mid-term 2025 target has been set, focusing on high-risk suppliers in focus countries. At least 80% of spending on high-risk suppliers in focus countries 1 covered by SSBM by 2025 n.a. In 2023, we reached 42% of spending on high-risk suppliers in focus countries covered by SSBM. At the end of 2024, 68% of high-risk supply spending in focus countries was covered by the SSBM program. (assured) 1 Current focus countries are Brazil, Bulgaria, China, Egypt, India, Malaysia, Mexico, Saudi Arabia, South Africa, Thailand, Tunisia and Türkiye. At the end of 2024, we reviewed the top-ten non-conformities identified during on- site assessments in the years 2021 through 2024. They are listed in the graph below. This list will inform our interventions with suppliers in 2025. 86 ABB SUSTAINABILITY STATEMENT 2024 THIRD-PARTY MANAGEMENT The SSBM program is linked to our wider Third-Party Management (TPM) program. The TPM program sets core minimum integrity requirements for the selection, onboarding, engaging, monitoring, managing and termination of relationships between ABB and third parties. It is implemented to identify, assess, monitor and manage integrity risks to which we are exposed via third-party relationships. The TPM program enables identification of risks that may have an impact on sustainability matters (e.g., anti-bribery and corruption and human rights) and could lead to regulatory, legal, financial or reputational damage. Depending on the identified risks, further due diligence is required and mitigation actions are implemented. CONFLICT MINERALS AND OTHER MINERALS OF CONCERN Responsibly sourcing conflict minerals and other minerals of concern is part of our responsible sourcing commitment. This is also reflected in our Policy on Conflict Minerals. We have established a Conflict Minerals Program based on the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict Affected and High-Risk Areas, and other international standards. Within this program, we continue our work to understand and limit our exposure to conflict minerals (tantalum, tin, tungsten and gold, or “3TG”), as defined by Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and EU Directive 2017/821. We request information from our suppliers on the source of these minerals and other minerals of concern, such as cobalt, and work with them to avoid sourcing from smelters or refiners (SORs) in the covered countries (the Democratic Republic of the Congo and neighboring countries) and conflict- affected and high-risk areas (CAHRAs), other than those that have implemented OECD-aligned programs. We actively work with our suppliers to ensure that any minerals contained in the products and materials supplied to ABB originate from conflict-free sources. We also aim to transition away from smelters and refiners that have been reported publicly for money laundering or human rights violations, with geopolitical and sourcing risks or are based in countries with country sanctions. 51% 50% 45% 42% 42% 35% 35% 34% 32% 31% First aid and firefighting equipment Unsafe working practices Excess working hours Communication of hazards Emergency (including medical) preparedness and drills No weekly day off Personal Protective Equipment Statistics and reports Managing sub-suppliers and subcontractors Paid leave 2021 - 2024 top 10 non-compliances SSBM supplier assessments ABB SUSTAINABILITY STATEMENT 2024 87 We continue to participate in outreach efforts to smelters and refineries through the Responsible Minerals Initiative (RMI) and its member companies. The RMI, of which ABB is an active member, is an organization working to address responsible mineral sourcing in the supply chain. In 2024, we led the RMI outreach to tin smelters in Indonesia to have them undergo the RMI’s Responsible Minerals Assurance Process (RMAP) and work on corrective action plans after completing a RMAP audit. This was followed by smelter visits in Vietnam with RMI. ABB is the single point of contact for various smelters and refiners in Asia. In addition to carefully tracking our sources for tantalum, tin, tungsten and gold, we have expanded our survey to cover the use of other minerals in our products. Using the Extended Minerals Reporting Template developed by the RMI, we identified pinch points and conducted due diligence on our cobalt supply chains. We continue to expand our due diligence on other minerals and will start to survey our suppliers’ use of mica in 2025. In response to the requirements established by the provisions of the Swiss Code of Obligations (Art. 964j–l CO) and the Swiss Ordinance on Due Diligence and Transparency in relation to Minerals and Metals from Conflict-Affected Areas and Child Labour (DDTrO), we have assessed our respective risk exposure and reached the following conclusions: The quantities of minerals and metals in scope of the aforementioned regulations which ABB imported into or processed in Switzerland in 2024 are substantially below applicable thresholds. Hence, ABB is exempted from specific due diligence and reporting obligations with regard to conflict minerals under the provisions of the Swiss Code of Obligations and the DDTrO, respectively. — Anti-corruption and anti-bribery G1-3: PREVENTION AND DETECTION OF CORRUPTION AND BRIBERY Integrity and transparency are core to our operating model. We aim to embed integrity and transparency in everything we do. Targets Baseline (baseline year) 2023 status 2024 status (assured) INTEGRITY AND TRANSPARENCY Global framework for assessing and mitigating third-party integrity risks through risk-based due diligence and life cycle monitoring n.a. This target measures the implementation of a global framework for assessing third-party integrity risks. It is an ongoing and critical organization-wide, integrity-based enhancement, which strengthens how we onboard and manage the life cycle of our relationships with suppliers, sales channels and customers. Framework established and operational. Integrity due diligence and risk management enhancements for suppliers (buy-side) and sales channels (sell-side) launched globally. Framework enhanced and implementation tested. Comprehensive monitoring and risk mitigation guidance developed. Focused on the governance of this framework to sustain its operation and risk management of legacy third party relationships, both in terms of suppliers and sales channels. Development of business specific plans to monitor and mitigate third party risks, with focus on resourcing for sustaining operation. 88 ABB SUSTAINABILITY STATEMENT 2024 Global Integrity Program underpinned by accountability for integrity and an adaptive risk management strategy gained from insights through targeted learnings, transparent reporting and monitoring n.a. This target measures the implementation and effectiveness of our Global Integrity Program through how we drive individual accountability for integrity and adapt our risk management strategy to real-time data insights gained from integrity-based learnings, reporting and monitoring. Developed new antitrust foundation training and added new integrity training content to the integrity awareness portal. The Business Ethics Helpline and reporting capabilities have been enhanced with new case management software. Enhancements have also included the creation of a Risk Monitoring Dashboard to identify potential areas of heightened risk. Our culture of integrity and transparency is anchored in the ABB Code of Conduct and is strengthened by a range of other ABB policies and procedures. The Integrity & Regulatory Affairs (I&RA) team, which is part of the Legal & Integrity function, is responsible for driving integrity enhancements that apply to all ABB functions and business areas. The team oversees a comprehensive integrity program that can adapt to risk in real time and is fit-for-purpose. The result of more than 20 years of development, the program has in recent years been significantly transformed. The integrity program is underpinned by accountability for integrity and adaptive risk management strategy from insights through targeted learnings, transparent reporting and monitoring. Since 2023, reported incidents have been structured into the following categories (as well as more detailed subcategories within each of these) to ensure appropriate attention, resourcing, and internal escalation: • 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 issue We have seen an increase in total incidents reported to our Business Ethics Helpline since 2022. We attribute this to an increased confidence in our strengthened reporting and allegation management processes. We have taken steps in 2024 to continue to develop our risk management systems and controls and to strengthen our integrity culture. This included enhancing our third-party management framework through comprehensive monitoring and risk mitigation guidance, as well as commencing a large-scale risk management project in relation to our legacy supplier and sales channel population. We also created new antitrust foundation training and added new integrity training content to the integrity awareness portal. Our business areas implemented tailored integrity learning programs for their staff, based on their bespoke risk management plans. ABB SUSTAINABILITY STATEMENT 2024 89 We have also improved our Business Ethics Helpline and reporting capabilities through the introduction of new case management software with increased functionality and data analytics. In 2024, we continued to strengthen our human resources teams to enforce a zero-tolerance policy towards discrimination and harassment. We empowered business area human resources teams to directly conduct investigations to increase accountability for workplace behavior within those business areas. Risk surveillance abilities were further enhanced in 2024 with the creation of the Risk Monitoring Dashboard. This dashboard supplements the existing integrity and investigations metrics reflected in the dashboards mentioned above with additional metrics and risk scoring capabilities, to identify potential areas of heightened risk for business focus. ANTI-BRIBERY AND ANTI-CORRUPTION PROGRAM At ABB, we have zero tolerance for unethical business practices. Any abuse of power or trust for private gain is a breach of our ethical standards and Code of Conduct and has no place at ABB. We know that having an adaptive anti-bribery and corruption (ABAC) program, which allows us to anticipate and meet risks head-on, is critical for our organizational success. During 2024, we continued to enhance our ABAC program and to drive the ABAC framework implementation to all business areas. The ABAC framework is a conceptual overview of existing key ABAC policies, procedures and controls that have been designed and implemented across our operations to prevent, detect and respond to key ABAC risks that we face as a global organization. To inform how we continuously develop our ABAC program, we continued to perform targeted monitoring and testing activities throughout the year. In 2024, this included the connection of new data sources to our continuous monitoring platform and the analysis of new business area, division and market-level insights. We also carried out a division-level ABAC risk assessment regarding the extent of implementation of enhanced policies, procedures and controls, and developing and monitoring data-driven dashboards fed by primary enterprise tools used for day-to-day business. Through this, we continue to identify key ABAC risks in our operations, which we are addressing through various initiatives, including targeted face-to-face and online training of our most at-risk employees. Our global framework for managing third-party integrity risk, which was launched in 2022, is a key pillar of our ABAC program. In 2024, the framework was extended to incorporate the identification and enhanced management and mitigation of third-party integrity risks within our legacy third-party relationships for both our suppliers and sales channels. In 2025, the focus will be on extending this global framework to our new third-party population. Building on the extensive enhancement of our third-party management program in the previous year (2023), we further reinforced our management of third-party risks through the expansion of the program to focus on our legacy third-party relationships on both the supplier and sales channel side. On the supplier side, our updated Supplier Code of Conduct (SCoC) and the SCoC Implementation Guide provide for an increased focus on business conduct on the part of all our suppliers. The program has strengthened our risk-based approach to selecting third parties and enabled more effective oversight and monitoring of their activities and overall performance across our total population of third parties. 90 ABB SUSTAINABILITY STATEMENT 2024 Among the actions we took in 2024 to mitigate specific negative impacts involving our ABAC risks, we activated and worked under our first follow-up work plan for year two of the three-year Deferred Prosecution Agreement (DPA). The workplan was developed to meet the requirements of a DPA that ABB entered into as part of a settlement with the United States Department of Justice and the Securities and Exchange Commission, announced on December 2, 2022. In 2025, we will be activating and working under our workplan for the final year of the three-year DPA. The workplan is characterized by appropriate governance, a clear project management structure, change management tools, as well as resourcing. It places ownership and accountability for its activities with our business areas and divisions in keeping with the ABB Way operating model. INTEGRITY LEARNING 2024 Overall, our integrity training program takes a hybrid approach to instruction, combining self-guided learning with bespoke, role-specific mandatory training, thereby encouraging individual ownership and accountability. It centers on the upskilling of employees in gatekeeper functions and customer-facing roles. The ABAC training program aims to enhance core ABAC competencies while highlighting the critical role these individuals play in upholding our integrity culture and compliance obligations. In 2023, we had revisited and relaunched our Code of Conduct, promoting it through a global communications campaign led by our Executive Committee and supported by manager-led discussions, with the aim of driving a better understanding of our global policies on anti-bribery and corruption and respect in the workplace. As part of the Code of Conduct relaunch, we created a series of mandatory training modules that brought to life our expectations and covered, in particular, the workplace behavior topics such as bullying and harassment, equality and discrimination and speaking up. Our Code of Conduct has been translated into 17 languages and provided in different formats to make it accessible to office and production staff alike. In 2024, our business areas built on the success of these training modules to develop their own tailored learnings, adapted for and specific to roles and certain at-risk areas within each business. The divisions also carried out ABAC risk assessments and used the data derived from this exercise to inform the learning strategy. Straight Talk, an internal platform for sharing real-life integrity successes and failures at ABB, serves as a strong complement to our training program and has continued to be well received throughout the Group. We revamped the Straight Talk platform in 2024 with the addition of new content and functionality. This transparent communications tool consolidates lessons learned and supports our speak-up culture with regular messaging about our reporting channels. It also provides key leaders with comprehensive data on our investigation portfolio, helping them set the tone from the top in their team meetings. INTEGRITY ANALYTICS To track the effectiveness of our integrity-related initiatives, we utilize data analytics and conduct transaction monitoring. Our continuous monitoring platform is designed to detect ABAC and fraud risks by applying risk algorithms to data drawn from multiple company systems. Our Integrity Analytics Report, a live dashboard available via our integrity web portal, provides insights into three key metrics: trust, engagement and transparency. To offer insight into ongoing and closed cases, a number of real- time and quarterly investigation dashboards are made available to the appropriate stakeholders. In 2024, we have further enhanced our data analytics and transaction monitoring capabilities through the introduction of new data sources and the expansion of the Integrity Analytics Report to cover additional integrity-related areas such as TPM, gifts, travel and hospitality. ABB SUSTAINABILITY STATEMENT 2024 91 — EU TAXONOMY: 2024 TABLES (assured) ABB GROUP ECONOMIC ACTIVITIES 2024 IN ACCORDANCE WITH THE EU TAXONOMY EU TAXONOMY - TURNOVER Financial year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) Turnover (3) Proportion of turnover, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum Safeguards (17) Proportion of Taxonomy aligned (A.1) or eligible (A.2) turnover, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T A. TAXONOMY-ELIGIBLE ACTIVITIES A.1. ENVIRONMENTALLY SUSTAINABLE ACTIVITIES (TAXONOMY-ALIGNED) 7.6 Installation, maintenance and repair of renewable energy technologies CCM 7.6 <0.5 <0.5% Y N/EL N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y <0.5% E Turnover of environmental sustainable activities (Taxonomy-aligned activities) (A.1) <0.5 <0.5% 0% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 6% Of which Enabling — 0% 0% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 6% E Of which Transitional — 0% 0% 0% T A.2. TAXONOMY-ELIGIBLE BUT NOT ENVIRONMENTALLY SUSTAINABLE ACTIVITIES (NOT TAXONOMY-ALIGNED ACTIVITIES) EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL 3.1 Manufacture of renewable energy technologies CCM 3.1 287 1% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.2 Equipment for the production and use of hydrogen CCM 3.2 4 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 92 ABB SUSTAINABILITY STATEMENT 2024 Financial year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) Turnover (3) Proportion of turnover, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum Safeguards (17) Proportion of Taxonomy aligned (A.1) or eligible (A.2) turnover, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T 3.3 Manufacture of low carbon technologies for transport CCM 3.3 7 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.4 Manufacture of batteries CCM 3.4 44 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 3.5 Manufacture of energy efficiency equipment for buildings CCM 3.5 212 1% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.6 Manufacture of other low-carbon technologies CCM 3.6 1,261 4% EL N/EL N/EL N/EL N/EL N/EL 3% 3.18 Manufacture of automotive mobility components CCM 3.18 7 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 3.19 Manufacture of rail constituents CCM 3.19 587 2% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.20 Manufacture, installation, and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution CCM 3.20 11,492 35% EL N/EL N/EL N/EL N/EL N/EL 27% 4.9 Transmission and distribution of electricity CCM 4.9 16 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 6.14 Infrastructure for rail transport CCM 6.14 91 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 6.15 Infrastructure enabling low-carbon road transport and public transport CCM 6.15 46 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 6.16 Infrastructure enabling low carbon water transport CCM 6.16 316 1% EL N/EL N/EL N/EL N/EL N/EL <0.5% 8.2 Data-driven solutions for GHG emissions reductions CCM 8.2 34 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 1.2 Manufacture of electrical and electronic equipment CE 1.2 1,942 6% N/EL N/EL N/EL N/EL EL N/EL 5% 4.1 Provision of IT/OT data-driven solutions and software CE 4.1 37 <0.5% N/EL N/EL N/EL N/EL EL N/EL <0.5% 5.1 Repair, refurbishment and remanufacturing CE 5.1 514 2% N/EL N/EL N/EL N/EL EL N/EL 1% 5.2 Sale of spare-parts CE 5.2 771 2% N/EL N/EL N/EL N/EL EL N/EL 2% 5.3 Preparation of re-use of end-of-life products and product components CE 5.3 — 0% N/EL N/EL N/EL N/EL EL N/EL <0.5% ABB SUSTAINABILITY STATEMENT 2024 93 Financial year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) Turnover (3) Proportion of turnover, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum Safeguards (17) Proportion of Taxonomy aligned (A.1) or eligible (A.2) turnover, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T 5.4 Sale of second-hand goods CE 5.4 <0.5 <0.5% N/EL N/EL N/EL N/EL EL N/EL <0.5% Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 17,667 54% 44% 0% 0% 0% 10% 0% 40% A. Turnover of Taxonomy eligible activities (A.1+A.2) 17,667 54% 44% 0% 0% 0% 10% 0% 46% B. TAXONOMY-NON-ELIGIBLE ACTIVITIES Turnover of Taxonomy-non-eligible activities 15,183 46% Total (A+B) 32,850 100% Due to rounding, numbers presented may not add to the totals provided. Due to disclosure format, prior year alignment figures do not add to the totals. The detailed 2023 aligned numbers are available in 2023 Sustainability Report. Total ABB Group % Proportion of turnover/Total turnover Taxonomy-aligned per objective Taxonomy-eligible per objective CCM 0% 44% CCA % % WTR % % CE 0% 10% PPC % % BIO % % 94 ABB SUSTAINABILITY STATEMENT 2024 ABB GROUP ECONOMIC ACTIVITIES 2024 IN ACCORDANCE WITH THE EU TAXONOMY EU TAXONOMY - CAPEX Financial Year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) CapEx (3) Proportion of CapEx, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum Safeguards (17) Proportion of Taxonomy-aligned (A.1) or eligible (A.2) CapEx, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T A. TAXONOMY-ELIGIBLE ACTIVITIES A.1. ENVIRONMENTALLY SUSTAINABLE ACTIVITIES (TAXONOMY-ALIGNED) 7.4 Installation, maintenance and repair of charging stations for electric vehicles in buildings CCM 7.4 <0.5 <0.5% Y N/EL N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y <0.5% E 7.5 Installation, maintenance and repair of instruments and devices for measuring, regulation and controlling energy performance of buildings CCM 7.5 1 <0.5% Y N/EL N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y <0.5% E 7.6 Installation, maintenance and repair of renewable energy technologies CCM 7.6 4 <0.5% Y N/EL N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y 1% E 7.7 Acquisition and ownership of buildings CCM 7.7 11 1% Y N/EL N/EL N/EL N/EL N/EL Y Y Y Y Y Y Y 2% CapEx of environmental sustainable activities (Taxonomy-aligned activities) (A.1) 16 1% 1% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 8% Of which Enabling 5 1% 1% 0% 0% 0% 0% 1% Y Y Y Y Y Y Y 3% E Of which Transitional — 0% 0% 3% T A.2. TAXONOMY-ELIGIBLE BUT NOT ENVIRONMENTALLY SUSTAINABLE ACTIVITIES (NOT TAXONOMY-ALIGNED ACTIVITIES) EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL 3.1 Manufacture of renewable energy technologies CCM 3.1 7 1% EL N/EL N/EL N/EL N/EL N/EL 1% 3.2 Equipment for the production and use of hydrogen CCM 3.2 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.3 Manufacture of low carbon technologies for transport CCM 3.3 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.4 Manufacture of batteries CCM 3.4 1 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% ABB SUSTAINABILITY STATEMENT 2024 95 Financial Year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) CapEx (3) Proportion of CapEx, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum Safeguards (17) Proportion of Taxonomy-aligned (A.1) or eligible (A.2) CapEx, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T 3.5 Manufacture of energy efficiency equipment for buildings CCM 3.5 7 <0.5% EL N/EL N/EL N/EL N/EL N/EL 2% 3.6 Manufacture of other low-carbon technologies CCM 3.6 7 1% EL N/EL N/EL N/EL N/EL N/EL 1% 3.18 Manufacture of automotive and mobility components CCM 3.18 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 3.19 Manufacture of rail constituents CCM 3.19 18 1% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.20 Manufacture, installation, and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution CCM 3.20 325 23% EL N/EL N/EL N/EL N/EL N/EL 20% 4.9 Transmission and distribution of electricity CCM 4.9 1 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 6.5 Transport by motorbikes, passenger cars and light commercial vehicles CCM 6.5 99 7% EL N/EL N/EL N/EL N/EL N/EL 4% 6.14 Infrastructure for rail transport CCM 6.14 2 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 6.15 Infrastructure enabling low-carbon road transport and public transport CCM 6.15 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 6.16 Infrastructure enabling low carbon water transport CCM 6.16 2 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 7.2 Renovation of Existing Buildings CCM 7.2 — 0% EL N/EL N/EL N/EL N/EL N/EL 2% 7.3 Installation, maintenance and repair of energy efficiency equipment CCM 7.3 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 7.4 Installation, maintenance and repair of charging stations for electric vehicles in buildings CCM 7.4 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 7.5 Installation, maintenance and repair of instruments and devices for measuring, regulation and controlling energy performance of buildings CCM 7.5 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 7.6 Installation, maintenance and repair of renewable energy technologies CCM 7.6 — 0% EL N/EL N/EL N/EL N/EL N/EL <0.5% 7.7 Acquisition and ownership of buildings CCM 7.7 50 4% EL N/EL N/EL N/EL N/EL N/EL 22% 96 ABB SUSTAINABILITY STATEMENT 2024 Financial Year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) CapEx (3) Proportion of CapEx, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum Safeguards (17) Proportion of Taxonomy-aligned (A.1) or eligible (A.2) CapEx, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T 8.2 Data-driven solutions for GHG emissions reductions CCM 8.2 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 1.2 Manufacture of electrical and electronic equipment CE 1.2 50 4% N/EL N/EL N/EL N/EL EL N/EL 2% 4.1 Provision of IT/OT data-driven solutions and software CE 4.1 1 <0.5% N/EL N/EL N/EL N/EL EL N/EL <0.5% 5.1 Repair, refurbishment and remanufacturing CE 5.1 9 1% N/EL N/EL N/EL N/EL EL N/EL <0.5% 5.2 Sale of spare-parts CE 5.2 15 1% N/EL N/EL N/EL N/EL EL N/EL 1% 5.3 Preparation of re-use of end-of-life products and product components CE 5.3 — 0% N/EL N/EL N/EL N/EL EL N/EL <0.5% 5.4 Sale of second-hand goods CE 5.4 <0.5 <0.5% N/EL N/EL N/EL N/EL EL N/EL <0.5% CapEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 596 43% 37% 0% 0% 0% 5% 0% 56% CapEx of Taxonomy eligible activities (A.1+A.2) 612 44% 38% 0% 0% 0% 5% 0% 64% B. TAXONOMY-NON-ELIGIBLE ACTIVITIES CapEx of Taxonomy-non-eligible activities 787 56% TOTAL 1,398 100% Due to rounding, numbers presented may not add to the totals provided. Due to disclosure format, prior year alignment figures do not add to the totals. The detailed 2023 aligned numbers are available in 2023 Sustainability Report. ABB SUSTAINABILITY STATEMENT 2024 97 Total ABB Group % Proportion of CapEx/Total CapEx Taxonomy-aligned per objective Taxonomy-eligible per objective CCM 1% 38% CCA % % WTR % % CE 0% 5% PPC % % BIO % % 98 ABB SUSTAINABILITY STATEMENT 2024 ABB GROUP ECONOMIC ACTIVITIES 2024 IN ACCORDANCE WITH THE EU TAXONOMY EU TAXONOMY - OPEX Financial Year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) OpEx (3) Proportion of OpEx, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum safeguards (17) Proportion of Taxonomy-aligned (A.1.) or eligible (A.2.) OpEx, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T A. TAXONOMY-ELIGIBLE ACTIVITIES A.1. ENVIRONMENTALLY SUSTAINABLE ACTIVITIES (TAXONOMY-ALIGNED) OpEx of environmental sustainable activities (Taxonomy-aligned) (A.1) — 0% 0% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 6% Of which Enabling — 0% 0% 0% 0% 0% 0% 0% Y Y Y Y Y Y Y 5% E Of which Transitional — 0% 0% — T A.2. TAXONOMY-ELIGIBLE BUT NOT ENVIRONMENTALLY SUSTAINABLE ACTIVITIES (NOT TAXONOMY-ALIGNED ACTIVITIES) EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL EL; N/EL 3.1 Manufacture of renewable energy technologies CCM 3.1 17 1% EL N/EL N/EL N/EL N/EL N/EL 1% 3.2 Equipment for the production and use of hydrogen CCM 3.2 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 3.3 Manufacture of low carbon technologies for transport CCM 3.3 <0.5 <0.5% EL N/EL N/EL N/EL N/EL N/EL 1% 3.4 Manufacture of batteries CCM 3.4 3 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 3.5 Manufacture of energy efficiency equipment for buildings CCM 3.5 12 1% EL N/EL N/EL N/EL N/EL N/EL 2% 3.6 Manufacture of other low-carbon technologies CCM 3.6 50 3% EL N/EL N/EL N/EL N/EL N/EL 1% 3.18 Manufacture of automotive and mobility components CCM 3.18 1 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 3.19 Manufacture of rail constituents CCM 3.19 42 2% EL N/EL N/EL N/EL N/EL N/EL <0.5% ABB SUSTAINABILITY STATEMENT 2024 99 Financial Year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) OpEx (3) Proportion of OpEx, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum safeguards (17) Proportion of Taxonomy-aligned (A.1.) or eligible (A.2.) OpEx, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T 3.20 Manufacture, installation, and servicing of high, medium and low voltage electrical equipment for electrical transmission and distribution CCM 3.20 655 34% EL N/EL N/EL N/EL N/EL N/EL 26% 4.9 Transmission and distribution of electricity CCM 4.9 1 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 6.14 Infrastructure for rail transport CCM 6.14 3 <0.5% EL N/EL N/EL N/EL N/EL N/EL <0.5% 6.15 Infrastructure enabling low-carbon road transport and public transport CCM 6.15 2 <0.5% EL N/EL N/EL N/EL N/EL N/EL 0% 6.16 Infrastructure enabling low carbon water transport CCM 6.16 11 1% EL N/EL N/EL N/EL N/EL N/EL <0.5% 7.7 Acquisition and ownership of buildings CCM 7.7 — 0% EL N/EL N/EL N/EL N/EL N/EL 0% 8.2 Data-driven solutions for GHG emissions reductions CCM 8.2 1 <0.5% EL N/EL N/EL N/EL N/EL N/EL 1% 9.1 Close to market research, development and innovation CCM 9.1 20 1% EL N/EL N/EL N/EL N/EL N/EL <0.5% 1.2 Manufacture of electrical and electronic equipment CE 1.2 100 5% N/EL N/EL N/EL N/EL EL N/EL 5% 4.1 Provision of IT/OT data-driven solutions and software CE 4.1 2 <0.5% N/EL N/EL N/EL N/EL EL N/EL 2% 5.1 Repair, refurbishment and remanufacturing CE 5.1 28 1% N/EL N/EL N/EL N/EL EL N/EL 1% 5.2 Sale of spare-parts CE 5.2 39 2% N/EL N/EL N/EL N/EL EL N/EL 0% 5.3 Preparation of re-use of end-of-life products and product components CE 5.3 — 0% N/EL N/EL N/EL N/EL EL N/EL <0.5% 5.4 Sale of second-hand goods CE 5.4 <0.5 <0.5% N/EL N/EL N/EL N/EL EL N/EL <0.5% OpEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 989 51% 42% 0% 0% 0% 9% 0% 39% A. OpEx of Taxonomy eligible activities (A.1+A.2) 989 51% 42% 0% 0% 0% 9% 0% 45% 100 ABB SUSTAINABILITY STATEMENT 2024 Financial Year 2024 2024 Substantial contribution criteria DNSH criteria Code (2) OpEx (3) Proportion of OpEx, 2024 (4) Climate Change Mitigation (5) Climate Change Adaptation (6) Water (7) Pollution (8) Circular Economy (9) Biodiversity (10) Climate Change Mitigation (11) Climate Change Adaptation (12) Water (13) Pollution (14) Circular Economy (15) Biodiversity (16) Minimum safeguards (17) Proportion of Taxonomy-aligned (A.1.) or eligible (A.2.) OpEx, 2023 (18) Category enabling activity (19) Category transitional activity (20) Economic activities (1) $million % Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y; N; N/EL Y/N Y/N Y/N Y/N Y/N Y/N Y/N % E T B. TAXONOMY-NON-ELIGIBLE ACTIVITIES OpEx of Taxonomy-non-eligible activities 946 49% TOTAL 1,935 100% Due to rounding, numbers presented may not add to the totals provided. Due to disclosure format, prior year alignment figures do not add to the totals. The detailed 2023 aligned numbers are available in 2023 Sustainability Report. Total ABB Group % Proportion of OpEx/Total OpEx Taxonomy-aligned per objective Taxonomy-eligible per objective CCM 0% 42% CCA % % WTR % % CE 0% 9% PPC % % BIO % % Key: Substantial Contribution Criteria Minimum Safeguards DNSH Criteria Y – Yes Taxonomy eligible and Taxonomy-aligned activity with the relevant environmental objective Y Minimum safeguards are met Y DNSH criteria are met CCM Climate Change Mitigation N Minimum safeguards are not met N DSNH criteria are not met CCA Climate Change Adaptation N – No Taxonomy eligible but not Taxonomy-aligned activity with the relevant environmental objective WTR Water and Marine Resource CE Circular Economy N/EL – not eligible Taxonomy non-eligible activity for the relevant environmental objective PPC Pollution Prevention and Control EL – eligible Taxonomy eligible activity for the relevant objective ABB SUSTAINABILITY STATEMENT 2024 101 NUCLEAR AND FOSSIL GAS RELATED ACTIVITIES Row Nuclear energy related activities 1 The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle. NO 2 The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies. NO 3 The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades. NO Fossil gas related activities 4 The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels. NO 5 The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels. NO 6 The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels. NO 102 ABB SUSTAINABILITY STATEMENT 2024 — SWISS CODE OF OBLIGATIONS CONTENT INDEX This Sustainability Report also covers the reporting requirements as defined under Art. 964a ss. of the Swiss Code of Obligations (CO). For easy reference, please find below a table with links to the relevant sections: Page Reference Swiss CO - Art. 964b paragraph 2 (assured) 1 Description of the business model ABB is a technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. We operate in approximately 100 countries across three regions: Europe, the Americas, and Asia, Middle East and Africa, and generate revenues in numerous currencies. We govern our company through our four Business areas: Electrification, Motion, Process Automation, and Robotics & Discrete Automation and 19 divisions. While the ABB Way provides standardized policies, processes and systems, it also empowers our divisions to take full ownership of and accountability for their respective strategies, performance and resources. More about the ABB’s business model is available in the Financial Report 2024 -> Financial review of ABB Group -> About ABB, Organizational structure, History of the ABB Group, ABB Today, and Businesses. 2 Materiality assessment Double Materiality Assessment (p.16) 3 Description of policies adopted in relation to: • Environmental issues, including CO 2 goals Sustainability at ABB -> Sustainability-related policies (p. 19) Protecting the climate -> Climate change-related policies (p. 29) Committing to Circularity -> Policy commitments to circular resource management (p. 40) Water management at ABB -> Water-related policies (p. 43) Keeping pollution in check (p. 45) • Social issues Sustainability at ABB -> Sustainability-related policies (p. 19) Responsibility for our employees -> Employee-related policies (p. 58) Social protection in the value chain -> Supplier-related policies (p. 68) Protecting vulnerable communities -> Community-related policies (p. 74) Protecting consumers -> Consumer-related policies (p. 76) Good business conduct -> Business conduct-related policies (p. 81) • Employee-related issues Sustainability at ABB -> Sustainability-related policies (p. 19) Responsibility for our employees -> Employee-related policies (p. 58) • Respect for human rights Sustainability at ABB -> Sustainability-related policies (p. 19) Responsibility for our employees -> Employee-related policies (p. 58) Social protection in the value chain -> Supplier-related policies (p. 69) Protecting vulnerable communities -> Community-related policies (p. 74) Good business conduct -> Business conduct-related policies (p. 81) • Combatting corruption Sustainability at ABB -> Sustainability-related policies (p. 19) Good business conduct -> Business conduct-related policies (p. 81) ABB SUSTAINABILITY STATEMENT 2024 103 Page Reference 4 Presentation of the measures taken to implement these policies and an assessment of the effectiveness of these measures See above sections. 5 Description of the main risks related to the matters referred above and how ABB is dealing with these risks, in particular: a. Risks that arise from ABB’s own business operations, and Sustainability at ABB -> Material impacts, risks, and opportunities (p. 14) IRO descriptions in topical chapters -> pp.25, 39, 43, 45, 57, 68, 73, 76, 80 Specific climate risks -> pp. 25, 26, 37 b. Risks that arise from ABB’s business relationships, products or services (to the extent relevant and proportionate) Sustainability at ABB -> Material impacts, risks, and opportunities (p. 14) IRO descriptions in topical chapters -> pp.25, 39, 43, 45, 57, 68, 73, 76, 80 6 The main performance indicators for ABB’s activities in relation to the matters referred to above Protecting the climate (p. 24) Committing to Circularity (p. 39) Water management at ABB (p. 43) Responsibility for our employees (p. 57) Social protection in the value chain (p. 68) Protecting vulnerable communities (p. 73) Good business conduct (p. 79) Swiss CO - Art. 964j and the Ordinance on Due Diligence and Transparency in Relation to Minerals and Metals from Conflict- Affected Areas and Child Labor Conflict minerals Good business conduct -> Engaging suppliers -> Dealing with conflict minerals and other minerals of concern (p. 86) Child labor Protecting vulnerable communities -> Community-related policies -> Further human rights commitments (p. 74) Swiss CO – Ordinance on Climate Disclosures (assured) We fulfill the Swiss Ordinance on Climate Disclosures via relevant ESRS sections; please refer to the ESRS Index table for disclosures under ESRS E-1. Certain disclosures, primarily the risk quantification, are not yet reported. 104 ABB SUSTAINABILITY STATEMENT 2024 — ESRS CONTENT INDEX, INCLUDING GRI AND ISSB INTEROPERABILITY ESRS reference Related AR Name Location GRI 1 ISSB 2 ESRS 2 BP-1 5 a Basis for preparation of sustainability statement 2 GRI 2: General Disclosures 2021: 2-2: Entities included in the organization’s sustainability reporting ESRS 2 BP-1 5 b i Scope of consolidation of consolidated sustainability statement is same as for financial statements 2 GRI 2: General Disclosures 2021: 2-2: Entities included in the organization’s sustainability reporting ESRS 2 BP-1 5 b ii Indication of subsidiary undertakings included in consolidation that are exempted from individual or consolidated sustainability reporting 2 ESRS 2 BP-1 5 c AR 1 Disclosure of extent to which sustainability statement covers upstream and downstream value chain 2 ESRS 2 BP-1 5 d Option to omit specific piece of information corresponding to intellectual property, know-how or results of innovation has been used 2 ESRS 2 BP-1 5 e Option allowed by Member State to omit disclosure of impending developments or matters in course of negotiation has been used 2 ESRS 2 BP-2 9 a Disclosure of definitions of medium- or long-term time horizons 3 IFRS S2.10(d)4 ESRS 2 BP-2 9 b Disclosure of reasons for applying different definitions of time horizons 3 IFRS S2.10(d)4 ESRS 2 BP-2 10 a Disclosure of metrics that include value chain data estimated using indirect sources 3 ESRS 2 BP-2 10 b Description of basis for preparation of metrics that include value chain data estimated using indirect sources 3 ESRS 2 BP-2 10 c Description of resulting level of accuracy of metrics that include value chain data estimated using indirect sources 3 ESRS 2 BP-2 10 d Description of planned actions to improve accuracy in future of metrics that include value chain data estimated using indirect sources 3 ESRS 2 BP-2 11 a Disclosure of quantitative metrics and monetary amounts disclosed that are subject to high level of measurement uncertainty 3 ESRS 2 BP-2 11 b i Disclosure of sources of measurement uncertainty 3 ESRS 2 BP-2 11 b ii Disclosure of assumptions, approximations and judgements made in measurement 3 ESRS 2 BP-2 13 a Explanation of changes in preparation and presentation of sustainability information and reasons for them 3 GRI 2: General Disclosures 2021: 2-4 Restatements of information ESRS 2 BP-2 13 b Adjustment of comparative information for one or more prior periods is impracticable 3 GRI 2: General Disclosures 2021: 2-4 Restatements of information ESRS 2 BP-2 13 b, 13 c Disclosure of difference between figures disclosed in preceding period and revised comparative figures 3 GRI 2: General Disclosures 2021: 2-4 Restatements of information ABB SUSTAINABILITY STATEMENT 2024 105 ESRS reference Related AR Name Location GRI 1 ISSB 2 ESRS 2 BP-2 14 a Disclosure of nature of prior period material errors 3 GRI 2: General Disclosures 2021: 2-4 Restatements of information ESRS 2 BP-2 14 b Disclosure of corrections for prior periods included in sustainability statement 3 GRI 2: General Disclosures 2021: 2-4 Restatements of information ESRS 2 BP-2 14 c Disclosure of why correction of prior period errors is not practicable 3 GRI 2: General Disclosures 2021: 2-4 Restatements of information ESRS 2 BP-2 15 Disclosure of other legislation or generally accepted sustainability reporting standards and frameworks based on which information has been included in sustainability statement 4 ESRS 2 BP-2 15 Disclosure of reference to paragraphs of standard or framework applied 4 ESRS 2 BP-2 16 List of DRs or DPs incorporated by reference 4 ESRS 2 GOV-1 21 a Number of executive members 6 ESRS 2 GOV-1 21 a Number of non-executive members 6 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition ESRS 2 GOV-1 21 b Information about representation of employees and other workers 6 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition ESRS 2 GOV-1 21 c AR 5 Information about member's experience relevant to sectors, products and geographic locations of undertaking 6–7 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition ESRS 2 GOV-1 21 d Percentage of members of administrative, management and supervisory bodies by gender and other aspects of diversity 6 GRI 405: Diversity and equal opportunity 2016: 405-1 Diversity of governance bodies and employees ESRS 2 GOV-1 21 d Board's gender diversity ratio 6 GRI 405: Diversity and equal opportunity 2016: 405-1 Diversity of governance bodies and employees ESRS 2 GOV-1 21 e Percentage of independent board members 6 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition ESRS 2 GOV-1 22 a Information about identity of administrative, management and supervisory bodies or individual(s) within body responsible for oversight of impacts, risks and opportunities 5 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition IFRS S2.6(a) ESRS 2 GOV-1 22 b AR 3 Disclosure of how body's or individuals within body responsibilities for impacts, risks and opportunities are reflected in undertaking's terms of reference, board mandates and other related policies 5 GRI 2: General Disclosures 2021: 2-14 Role of the highest governance body in sustainability reporting IFRS S2.6(a)(i) ESRS 2 GOV-1 22 c AR 4 Description of management's role in governance processes, controls and procedures used to monitor, manage and oversee impacts, risks and opportunities 5 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts IFRS S2.6(b) ESRS 2 GOV-1 22 c i Description of how oversight is exercised over management-level position or committee to which management's role is delegated to 5 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts GRI 2: General Disclosures 2021: 2-13 Delegation of responsibility for managing impacts IFRS S2.6(b)(i) ESRS 2 GOV-1 22 c ii Information about reporting lines to administrative, management and supervisory bodies 5 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts GRI 2: General Disclosures 2021: 2-13 Delegation of responsibility for managing impacts ESRS 2 GOV-1 22 c iii Disclosure of how dedicated controls and procedures are integrated with other internal functions 5 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts IFRS S2.6(b)(ii) ESRS 2 GOV-1 22 d Disclosure of how administrative, management and supervisory bodies and senior executive management oversee setting of targets related to material impacts, risks and opportunities and how progress towards them is monitored 5 IFRS S2.6(a)(v) 106 ABB SUSTAINABILITY STATEMENT 2024 ESRS reference Related AR Name Location GRI 1 ISSB 2 ESRS 2 GOV-1 23 AR 5 Disclosure of how administrative, management and supervisory bodies determine whether appropriate skills and expertise are available or will be developed to oversee sustainability matters 7 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition GRI 2: General Disclosures 2021: 2-17 Collective knowledge of the highest governance body IFRS S2.6(a)(ii) ESRS 2 GOV-1 23 a Information about sustainability-related expertise that bodies either directly possess or can leverage 7 GRI 2: General Disclosures 2021: 2-17 Collective knowledge of the highest governance body IFRS S2.6(a)(ii) ESRS 2 GOV-1 23 b Disclosure of how sustainability-related skills and expertise relate to material impacts, risks and opportunities 7 GRI 2: General Disclosures 2021: 2-17 Collective knowledge of the highest governance body IFRS S2.6(a)(ii) ESRS 2 GOV-2 26 a Disclosure of whether, by whom and how frequently administrative, management and supervisory bodies are informed about material impacts, risks and opportunities, implementation of due diligence, and results and effectiveness of policies, actions, metrics and targets adopted to address them 8 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts GRI 2: General Disclosures 2021: 2-13 Delegation of responsibility for managing impacts GRI 2: General Disclosures 2021: 2-16 Communication of critical concerns IFRS S2.6(a)(iii) ESRS 2 GOV-2 26 b Disclosure of how administrative, management and supervisory bodies consider impacts, risks and opportunities when overseeing strategy, decisions on major transactions and risk management process 8 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts GRI 2: General Disclosures 2021: 2-24 Embedding policy commitments IFRS S2.6(a)(iv) ESRS 2 GOV-2 26 c Disclosure of list of material impacts, risks and opportunities addressed by administrative, management and supervisory bodies or their relevant committees 8 ESRS 2 GOV-3 29 AR 7 Incentive schemes and remuneration policies linked to sustainability matters for members of administrative, management and supervisory bodies exist 8–9 ESRS 2 GOV-3 29 a Description of key characteristics of incentive schemes 8–9 GRI 2: General Disclosures 2021: 2-19 Remuneration policies ESRS 2 GOV-3 29 b Description of specific sustainability-related targets and (or) impacts used to assess performance of members of administrative, management and supervisory bodies 8–9 GRI 2: General Disclosures 2021: 2-19 Remuneration policies IFRS S1.21(b) IFRS S2.29(g)(i) ESRS 2 GOV-3 29 c Disclosure of how sustainability-related performance metrics are considered as performance benchmarks or included in remuneration policies 8–9 GRI 2: General Disclosures 2021: 2-19 Remuneration policies IFRS S1.21(b) ESRS 2 GOV-3 29 d Percentage of variable remuneration dependent on sustainability-related targets and (or) impacts 9 ESRS 2 GOV-3 29 e Description of level in undertaking at which terms of incentive schemes are approved and updated 9 GRI 2: General Disclosures 2021: 2-20 Process to determine remuneration ESRS 2 GOV-4 30; 32 AR 8 - AR 10 Disclosure of mapping of information provided in sustainability statement about due diligence process 10–11 ESRS 2 GOV-5 36 a AR 11 Description of scope, main features and components of risk management and internal control processes and systems in relation to sustainability reporting 11 ESRS 2 GOV-5 36 b AR 11 Description of risk assessment approach followed 11 ESRS 2 GOV-5 36 c AR 11 Description of main risks identified and their mitigation strategies 11 ESRS 2 GOV-5 36 d AR 11 Description of how findings of risk assessment and internal controls as regards sustainability reporting process have been integrated into relevant internal functions and processes 11 ESRS 2 GOV-5 36 e AR 11 Description of periodic reporting of findings of risk assessment and internal controls to administrative, management and supervisory bodies 11 ESRS 2 SBM-1 40 a iii AR 12-13 Total number of employees (head count) 65 GRI 2: General Disclosures 2021: 2-7 Employees ABB SUSTAINABILITY STATEMENT 2024 107 ESRS reference Related AR Name Location GRI 1 ISSB 2 ESRS 2 SBM-1 40 a iii AR 12-13 Number of employees (head count) 65 GRI 2: General Disclosures 2021: 2-7 Employees ESRS 2 SBM-2 45 a AR 16 Description of stakeholder engagement 12–14 ESRS 2 SBM-2 45 a i AR 16 Description of key stakeholders 12–14 GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement ESRS 2 SBM-2 45 a ii AR 16 Description of categories of stakeholders for which engagement occurs 12–14 GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement ESRS 2 SBM-2 45 a iii AR 16 Description of how stakeholder engagement is organized 12–14 GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement ESRS 2 SBM-2 45 a iv AR 16 Description of purpose of stakeholder engagement 12–14 GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement ESRS 2 SBM-2 45 a v AR 16 Description of how outcome of stakeholder engagement is taken into account 14 ESRS 2 SBM-2 45 b AR 16 Description of understanding of interests and views of key stakeholders as they relate to undertaking's strategy and business model 12–14 ESRS 2 SBM-2 45 d Description of how administrative, management and supervisory bodies are informed about views and interests of affected stakeholders with regard to sustainability- related impacts 14 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts ESRS 2 SBM-3 48 a AR 17-18 Description of material impacts resulting from materiality assessment 14–16 GRI 3: Material Topics 2021: 3-2 List of material topics ESRS 2 SBM-3 48 a AR 17-18 Description of material risks and opportunities resulting from materiality assessment 14–16 GRI 3: Material Topics 2021: 3-2 List of material topics IFRS S2.10(a) IFRS S2.13(b) ESRS 2 SBM-3 48 b AR 18 Disclosure of current and anticipated effects of material impacts, risks and opportunities on business model, value chain, strategy and decision-making, and how undertaking has responded or plans to respond to these effects 16 IFRS S2.13(a) IFRS S2.14(a) ESRS 2 SBM-3 48 c iv AR 18 Description of nature of activities or business relationships through which undertaking is involved with material impacts 16 GRI 3: Material Topics 2021: Management of material topics ESRS 2 IRO-1 53 a Description of methodologies and assumptions applied in process to identify impacts, risks and opportunities 16–18 ESRS 2 IRO-1 53 b Description of process to identify, assess, prioritize and monitor potential and actual impacts on people and environment, informed by due diligence process 16 ESRS 2 IRO-1 53 b i Description of how process focuses on specific activities, business relationships, geographies or other factors that give rise to heightened risk of adverse impacts 16 ESRS 2 IRO-1 53 b ii Description of how process considers impacts with which undertaking is involved through own operations or as result of business relationships 16 GRI 3: Material Topics 2021: 3-1 Process to determine material topics ESRS 2 IRO-1 53 b iii Description of how process includes consultation with affected stakeholders to understand how they may be impacted and with external experts 16 GRI 3: Material Topics 2021: 3-1 Process to determine material topics ESRS 2 IRO-1 53 b iv Description of how process prioritizes negative impacts based on their relative severity and likelihood and positive impacts based on their relative scale, scope and likelihood and determines which sustainability matters are material for reporting purposes 17 GRI 3: Material Topics 2021: 3-1 Process to determine material topics ESRS 2 IRO-1 53 c Description of process used to identify, assess, prioritize and monitor risks and opportunities that have or may have financial effects 17 IFRS S2.25(a)(v) IFRS S2.25(b) 108 ABB SUSTAINABILITY STATEMENT 2024 ESRS reference Related AR Name Location GRI 1 ISSB 2 ESRS 2 IRO-1 53 c i Description of how connections of impacts and dependencies with risks and opportunities that may arise from those impacts and dependencies have been considered 17 ESRS 2 IRO-1 53 c ii Description of how likelihood, magnitude, and nature of effects of identified risks and opportunities have been assessed 17 IFRS S2.25(a)(iii) ESRS 2 IRO-1 53 c iii Description of how sustainability-related risks relative to other types of risks have been prioritized 17 IFRS S2.25(a)(iv) ESRS 2 IRO-1 53 d Description of decision-making process and related internal control procedures 17 GRI 2: General Disclosures 2021: 2-14 Role of the highest governance body in sustainability reporting ESRS 2 IRO-1 53 e Description of extent to which and how process to identify, assess and manage impacts and risks is integrated into overall risk management process and used to evaluate overall risk profile and risk management processes 17 IFRS S2.25(a)(v) IFRS S2.25(c) ESRS 2 IRO-1 53 f Description of extent to which and how process to identify, assess and manage opportunities is integrated into overall management process 17 IFRS S2.25(c) ESRS 2 IRO-1 53 g Description of input parameters used in process to identify, assess and manage material impacts, risks and opportunities 16 IFRS S2.25(a)(i) ESRS 2 IRO-1 53 h Description of how process to identify, assess and manage impacts, risks and opportunities has changed compared to prior reporting period 17 IFRS S2.25(a)(vi) ESRS 2 IRO-2 56 Disclosure of list of data points that derive from other EU legislation and information on their location in sustainability statement 19 ESRS 2 IRO-2 56 AR 19 Disclosure of list of ESRS Disclosure Requirements complied with in preparing sustainability statement following outcome of materiality assessment 19 ESRS 2 IRO-2 59 Explanation of how material information to be disclosed in relation to material impacts, risks and opportunities has been determined 19 E1 E1-1 17 Date of adoption of transition plan for undertakings not having adopted transition plan yet 24–25 E1 E1.SBM-3 18 Type of climate-related risk 25–26 GRI 201: Economic Performance 2016: 201-2 Financial implications and other risks and opportunities due to climate change IFRS S2.10(b) E1 E1.IRO-1 20 a, AR 9 AR 10 Description of process in relation to impacts on climate change 26 IFRS S2.25(a) E1 E1.IRO-1 20 b AR 13-AR 14 Description of process in relation to climate-related physical risks in own operations and along value chain 27 IFRS S2.25(a) E1 E1.IRO-1 AR 11 a AR 13-AR 14 Climate-related hazards have been identified over short-, medium- and long-term time horizons 27 E1 E1.IRO-1 AR 11 a AR 13-AR 14 Undertaking has screened whether assets and business activities may be exposed to climate-related hazards 27 E1 E1.IRO-1 AR 11 b AR 13-AR 14 Short-, medium- and long-term time horizons have been defined 27 IFRS S2.10(d)4 E1 E1.IRO-1 AR 11 c AR 13-AR 14 Extent to which assets and business activities may be exposed and are sensitive to identified climate-related hazards has been assessed 27 E1 E1.IRO-1 AR 11 d AR 13-AR 14 Identification of climate-related hazards and assessment of exposure and sensitivity are informed by high emissions climate scenarios 27 IFRS S2.22(b)(i) ABB SUSTAINABILITY STATEMENT 2024 109 ESRS reference Related AR Name Location GRI 1 ISSB 2 E1 E1.IRO-1 21 AR 13-AR 14 Explanation of how climate-related scenario analysis has been used to inform identification and assessment of physical risks over short, medium and long-term 27 IFRS S2.22(b)(i) IFRS S2.25(a)(ii) E1 E1.IRO-1 20 c AR 13-AR 14 Description of process in relation to climate-related transition risks and opportunities in own operations and along value chain 28 IFRS S2.25(b) E1 E1.IRO-1 AR 12 a AR 13-AR 14 Transition events have been identified over short-, medium- and long-term time horizons 28 E1 E1.IRO-1 AR 12 a AR 13-AR 14 Undertaking has screened whether assets and business activities may be exposed to transition events 28 E1 E1.IRO-1 AR 12 b AR 13-AR 14 Extent to which assets and business activities may be exposed and are sensitive to identified transition events has been assessed 28 E1 E1.IRO-1 AR 12 c AR 13-AR 14 Identification of transition events and assessment of exposure has been informed by climate-related scenario analysis 29 IFRS S2.22(b)(i) E1 E1.IRO-1 21 AR 13-AR 14 Explanation of how climate-related scenario analysis has been used to inform identification and assessment of transition risks and opportunities over short, medium and long-term 29 IFRS S2.22(b)(i) IFRS S2.25(a)(ii) E1 E1-2 25 AR 16-AR18 Sustainability matters addressed by policy for climate change 29–30 GRI 3: Material Topics 2021: GRI 3-3: Management of material topics E1 E1-3 29 a Decarbonization lever type 32 E1 E1-3 29 b Achieved GHG emission reductions 32 GRI 305: Emissions 2016: 305-5: Reduction of emissions E1 E1-3 29 b Expected GHG emission reductions 32 E1 E1-4 33 AR 27-AR 29 Disclosure of whether and how GHG emissions reduction targets and (or) any other targets have been set to manage material climate-related impacts, risks and opportunities 30 GRI 3: Material Topics 2021: GRI 3-3: Management of material topics E1 E1-4 34 a + 34 b Absolute value of total Greenhouse gas emissions reduction 30–31 GRI 305: Emissions 2016: 305-5: Reduction of emissions E1 E1-4 34 a + 34 b Percentage of total Greenhouse gas emissions reduction (as of emissions of base year) 30–31 E1 E1-4 34 a + 34 b Absolute value of Scope 1 Greenhouse gas emissions reduction 30–31 GRI 305: Emissions 2016: 305-5: Reduction of emissions E1 E1-4 34 a + 34 b Percentage of Scope 1 Greenhouse gas emissions reduction (as of emissions of base year) 30–31 E1 E1-4 34 a + 34 b Absolute value of location-based Scope 2 Greenhouse gas emissions reduction 30–31 GRI 305: Emissions 2016: 305-5: Reduction of emissions E1 E1-4 34 a + 34 b Percentage of location-based Scope 2 Greenhouse gas emissions reduction (as of emissions of base year) 30–31 E1 E1-4 34 a + 34 b Absolute value of market-based Scope 2 Greenhouse gas emissions reduction 30–31 GRI 305: Emissions 2016: 305-5: Reduction of emissions E1 E1-4 34 a + 34 b Percentage of market-based Scope 2 Greenhouse gas emissions reduction (as of emissions of base year) 30–31 E1 E1-4 34 a + 34 b Absolute value of Scope 3 Greenhouse gas emissions reduction 30–31 GRI 305: Emissions 2016: 305-5: Reduction of emissions E1 E1-4 34 a + 34 b Percentage of Scope 3 Greenhouse gas emissions reduction (as of emissions of base year) 30–31 E1 E1-4 34 b Explanation of how consistency of GHG emission reduction targets with GHG inventory boundaries has been ensured 31 GRI 3: Material Topics 2021: 3-3 Management of material topics GRI 305: Emissions 2016: 305-1 Direct (Scope 1) GHG emissions IFRS S2.36(a) IFRS S2.36(b) E1 E1-4 AR 25 a Description of how it has been ensured that baseline value is representative in terms of activities covered and influences from external factors 32 110 ABB SUSTAINABILITY STATEMENT 2024 ESRS reference Related AR Name Location GRI 1 ISSB 2 E1 E1-4 AR 25 b Description of how new baseline value affects new target, its achievement and presentation of progress over time 32 GRI 305: Emissions 2016: 305-1 Direct (Scope 1) GHG emissions GRI 305: Emissions 2016: 305-2 Energy indirect (Scope 2) GHG emissions GRI 305: Emissions 2016: 305-3 Other indirect (Scope 3) GHG emissions GRI 305: Emissions 2016: 305-5 Reduction of GHG emissions E1 E1-4 34 e, 16 a AR 26 GHG emission reduction target is science based and compatible with limiting global warming to one and half degrees Celsius 30 GRI 3: Material Topics 2021: GRI 3-3 Management of material topics IFRS S2.34(a) IFRS S2.36(d) E1 E1-4 34 f, 16 b AR 30 Description of expected decarbonization levers and their overall quantitative contributions to achieve GHG emission reduction target 32 E1 E1-5 37 a AR 33, AR 32 Total energy consumption from fossil sources 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 37 c Total energy consumption from renewable sources 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 37 c i Fuel consumption from renewable sources 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 37 c ii Consumption of purchased or acquired electricity, heat, steam, and cooling from renewable sources 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 37 c iii Consumption of self-generated non-fuel renewable energy 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 38 a AR 33 Fuel consumption from coal and coal products 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 38 b AR 33 Fuel consumption from crude oil and petroleum products 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 38 c AR 33 Fuel consumption from natural gas 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 38 d AR 33 Fuel consumption from other fossil sources 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 38 e AR 33 Consumption of purchased or acquired electricity, heat, steam, or cooling from fossil sources 33 GRI 302: Energy 2016: 302-1: Energy consumption within the organisation E1 E1-5 39 Non-renewable energy production 33 E1 E1-5 39 Renewable energy production 33 E1 E1-6 44 AR 39 Gross scopes 1, 2, 3 and total GHG emissions - GHG emissions per scope [table] 33–34 GRI 305: Emissions 2016: 305-1 Direct (Scope 1) GHG emissions GRI 305: Emissions 2016: 305-2 Energy indirect (Scope 2) GHG emissions GRI 305: Emissions 2016: 305-3 Other indirect (Scope 3) GHG emissions IFRS S2.29(a)(i) E1 E1-6 AR 46 d Gross scopes 1, 2, 3 and total GHG emissions - Scope 3 GHG emissions (GHG Protocol) [table] 35–37 E1 E1-6 47 Disclosure of significant changes in definition of what constitutes reporting undertaking and its value chain and explanation of their effect on year-to-year comparability of reported GHG emissions 34 IFRS S2.29(a)(iii)$ ABB SUSTAINABILITY STATEMENT 2024 111 ESRS reference Related AR Name Location GRI 1 ISSB 2 E1 E1-6 AR 39 b Disclosure of methodologies, significant assumptions and emissions factors used to calculate or measure GHG emissions 35–37 GRI 305: Emissions 2016: 305-1 Direct (Scope 1) GHG emissions GRI 305: Emissions 2016: 305-2 Energy indirect (Scope 2) GHG emissions GRI 305: Emissions 2016: 305-3 Other indirect (Scope 3) GHG emissions IFRS S2.B38-B57 IFRS S2.29(a)(iii) E1 E1-6 AR 42 c Disclosure of the effects of significant events and changes in circumstances (relevant to its GHG emissions) that occur between the reporting dates of the entities in its value chain and the date of the undertaking’s general purpose financial statements 37 IFRS S2.B19 E1 E1-6 AR 43 c biogenic emissions of CO2 from the combustion or bio- degradation of biomass not included in scope 1 GHG emissions 35 GRI 305: Emissions 2016: 305-1 Direct (Scope 1) GHG emissions E1 E1-6 AR 45 d Disclosure of types of contractual instruments used for sale and purchase of energy bundled with attributes about energy generation or for unbundled energy attribute claims 35 GRI 305: Emissions 2016: 305-1 Direct (Scope 1) GHG emissions GRI 305: Emissions 2016: 305-2 Energy indirect (Scope 2) GHG emissions IFRS S2.B31 E1 E1-6 AR 46 g Percentage of GHG scope 3 calculated using primary data 37 E1 E1-6 AR 46 i Disclosure of why scope 3 GHG emissions category has been excluded 37 GRI 305: Emissions 2016: 305-3 Other indirect (Scope 3) GHG emissions E1 E1-6 AR 46 i List of scope 3 GHG emissions categories included in inventory 37 GRI 305: Emissions 2016: 305-3 Other indirect (Scope 3) GHG emissions IFRS S2.B32 E1 E1-6 AR 46 h Disclosure of reporting boundaries considered and calculation methods for estimating scope 3 GHG emissions 37 E1 E1-6 53 AR 53 GHG emissions intensity, location-based (total GHG emissions per net revenue) 34 GRI 305: Emissions 2016: 305-4 GHG emissions intensity E1 E1-9 AR 69 b Disclosure of whether and how assessment of assets and business activities considered to be at material physical risk relies on or is part of process to determine material physical risk and to determine climate scenarios 37–38 E3 E3.IRO-1 8 a AR 1- AR 15 Disclosure of whether and how assets and activities have been screened in order to identify actual and potential water and marine resources-related impacts, risks and opportunities in own operations and upstream and downstream value chain and methodologies, assumptions and tools used in screening [text block] 43 GRI 303: Water and Effluents 2018: 303-1 Interactions with water as a shared resource E3 E3-1 12a AR 16 - AR 18 Disclosure of whether and how policy addresses water management 43–44 E3 E3-1 12a i AR 16 - AR 18 Disclosure of whether and how policy addresses the use and sourcing of water and marine resources in own operations 43–44 E3 E3-1 12 c AR 16 - AR 18 Disclosure of whether and how policy addresses commitment to reduce material water consumption in areas at water risk 43–44 E3 E3-4 28 b AR 28 Total water consumption in areas at water risk, including areas of high-water stress 44 GRI 303: Water and Effluents 2018: 303-5 Water consumption E3 E3-4 28 e AR 29 Disclosure of contextual information regarding water consumption 44 GRI 303: Water and Effluents 2018: 303-5 Water consumption E3 E3-4 28 e AR 29 Share of the measure obtained from direct measurement, from sampling and extrapolation, or from best estimates 44 GRI 303: Water and Effluents 2018: 303-5 Water consumption 112 ABB SUSTAINABILITY STATEMENT 2024 ESRS reference Related AR Name Location GRI 1 ISSB 2 E5 E5-1 15a Disclosure of whether and how policy addresses transitioning away from use of virgin resources, including relative increases in use of secondary (recycled) resources 40 E5 E5-1 15b Disclosure of whether and how policy addresses sustainable sourcing and use of renewable resources 40 E5 E5-3 24 AR 16 Disclosure of how target relates to resources (resource use and circular economy) 41 E5 E5-3 24 b Disclosure of how target relates to increase of circular material use rate 41 E5 E5-3 24 c AR 17 Disclosure of how target relates to minimization of primary raw material 41 E5 E5-3 24 e Target relates to waste management 41 E5 E5-3 24 e Disclosure of how target relates to waste management 41 E5 E5-5 37 a Total waste generated 41 GRI 306: Waste 2020: 306-3 Waste generated E5 E5-5 37 b AR 31 Waste diverted from disposal, breakdown by hazardous and non-hazardous waste and treatment type 41 GRI 306: Waste 2020: 306-4 Waste diverted from disposal E5 E5-5 37 c AR 32 Waste directed to disposal, breakdown by hazardous and non-hazardous waste and treatment type 41 GRI 306: Waste 2020: 306-5 Waste directed to disposal E5 E5-5 37 d Non-recycled waste 41 E5 E5-5 37 d Percentage of non-recycled waste 41 E5 E5-5 39 Total amount of hazardous waste 41 GRI 306: Waste 2020: 306-3 Waste generated S1 S1.SBM-3 14 AR 6 - AR7 All people in its own workforce who can be materially impacted by undertaking are included in scope of disclosure under ESRS 2 57 S1 S1.SBM-3 14 b Material negative impacts occurrence (own workforce) 58 S1 S1.SBM-3 14 c Description of activities that result in positive impacts and types of employees and non-employees in its own workforce that are positively affected or could be positively affected 57 S1 S1.SBM-3 15 AR 8 Disclosure of whether and how understanding of people in its own workforce with particular characteristics, working in particular contexts, or undertaking particular activities may be at greater risk of harm has been developed 63–64 S1 S1-1 20 Description of relevant human rights policy commitments relevant to own workforce 59 GRI 2: General Disclosures 2021: 2-23 Policy commitments S1 S1-1 20a Disclosure of general approach in relation to respect for human rights including labor rights, of people in its own workforce 59 GRI 2: General Disclosures 2021: 2-23 Policy commitments S1 S1-1 20b Disclosure of general approach in relation to engagement with people in its own workforce 59 GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement S1 S1-1 20c Disclosure of general approach in relation to measures to provide and (or) enable remedy for human rights impacts 59 GRI 3: Material Topics 2021: 3-3 Management of material topics S1 S1-1 21 AR 12 Disclosure of whether and how policies are aligned with relevant internationally recognized instruments 59 GRI 2: General Disclosures 2021: 2-23 Policy commitments S1 S1-1 23 Workplace accident prevention policy or management system is in place 59 GRI 403: Occupational health and safety 2018: 403-1 Occupational health and safety management system S1 S1-1 24a Specific policies aimed at elimination of discrimination are in place 60 GRI 3: Material Topics 2021: 3-3 Management of material topics S1 S1-1 24b AR 15 - AR 16 Grounds for discrimination are specifically covered in policy 60 S1 S1-1 24c Disclosure of specific policy commitments related to inclusion and (or) positive action for people from groups at particular risk of vulnerability in own workforce 60 GRI 2: General Disclosures 2021: 2-23 Policy commitments ABB SUSTAINABILITY STATEMENT 2024 113 ESRS reference Related AR Name Location GRI 1 ISSB 2 S1 S1-2 28 Disclosure of steps taken to gain insight into perspectives of people in its own workforce that may be particularly vulnerable to impacts and (or) marginalized 60–62 GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement S1 S1-3 32 b AR 28 Disclosure of specific channels in place for its own workforce to raise concerns or needs directly with undertaking and have them addressed 62 GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts GRI 403: Occupational health and safety 2018: 403-2 Hazard identification, risk assessment, and incident investigation S1 S1-3 32 c Grievance or complaints handling mechanisms related to employee matters exist 62 S1 S1-3 32 d Disclosure of processes through which undertaking supports or requires availability of channels 62 GRI 2: General Disclosures 2021: 2-26 Mechanisms for seeking advice and raising concerns S1 S1-4 38 a AR 42 Description of action taken, planned or underway to prevent or mitigate negative impacts on own workforce 62–64 GRI 3: Material Topics 2021: 3-3 Management of material topics GRI 403: Occupational health and safety 2018: 403-9 Work- related injuries GRI 403: Occupational health and safety 2018: 403-10 Work- related ill health S1 S1-4 38 d AR 38 - AR 39 Description of how effectiveness of actions and initiatives in delivering outcomes for own workforce is tracked and assessed 64 GRI 3: Material Topics 2021: 3-3 Management of material topics S1 S1-4 41 AR 37 Disclosure of whether and how it is ensured that own practices do not cause or contribute to material negative impacts on own workforce 61–62 S1 S1-6 50 a AR 57 Number of employees (head count) 65 GRI 2: General Disclosures 2021: 2-7 Employees GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-6 50 a AR 57 Average number of employees (head count) 65 GRI 2: General Disclosures 2021: 2-7 Employees GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-6 50 a AR 57 Number of employees in countries with 50 or more employees representing at least 10% of total number of employees 65 GRI 2: General Disclosures 2021: 2-7 Employees GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-6 50 a AR 57 Average number of employees in countries with 50 or more employees representing at least 10% of total number of employees 65 GRI 2: General Disclosures 2021: 2-7 Employees GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-6 50 c AR 59 Number of employees who have left undertaking 65 GRI 401: Employment 2016: 401-1 New employee hires and employee turnover S1 S1-6 50 c Percentage of employee turnover 65 GRI 401: Employment 2016: 401-1 New employee hires and employee turnover S1 S1-6 50 d AR 60 Description of methodologies and assumptions used to compile data (employees) 65 GRI 2: General Disclosures 2021: 2-7 employees S1 S1-6 50 d i Employees numbers are reported in head count or full-time equivalent 65 GRI 2: General Disclosures 2021: 2-7 employees S1 S1-6 50 d ii Employees numbers are reported at end of reporting period/average/other methodology 65 GRI 2: General Disclosures 2021: 2-7 employees S1 S1-6 50 e AR 58 Disclosure of contextual information necessary to understand data (employees) 65 GRI 2: General Disclosures 2021: 2-7 employees S1 S1-6 50 f Disclosure of cross-reference of information reported under paragraph 50 (a) to most representative number in financial statements 65 114 ABB SUSTAINABILITY STATEMENT 2024 ESRS reference Related AR Name Location GRI 1 ISSB 2 S1 S1-9 66a Gender distribution in number of employees (head count) at top management level 66 GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-9 66 a Gender distribution in percentage of employees at top management level (this datapoint is the same as our committed datapoint ‘proportion of women in senior management roles’) 66 GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-9 66 b Distribution of employees (head count) under 30 years old 66 GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-9 66 b Distribution of employees (head count) between 30 and 50 years old 66 GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-9 66 b Distribution of employees (head count) over 50 years old 66 GRI 405: Diversity and equal opportunity 2018: 405-1 Diversity of governance bodies and employees S1 S1-9 AR 71 Disclosure of own definition of top management used 66 S1 S1-14 88 a AR 80 Percentage of people in its own workforce who are covered by health and safety management system based on legal requirements and (or) recognized standards or guidelines 66 GRI 403: Occupational health and safety 2018: 403-8 Workers covered by an occupational health and safety management system S1 S1-14 88 b AR 82, AR 89 - AR91 Number of fatalities in own workforce as result of work- related injuries and work-related ill health 66 GRI 403: Occupational health and safety 2018: 403-9 Work- related injuries GRI 403: Occupational health and safety 2018: 403-10 Work- related ill health S1 S1-14 88 c AR 89 - AR 91 Number of recordable work-related accidents for own workforce 66 GRI 403: Occupational health and safety 2018: 403-9 Work- related injuries S1 S1-14 88 c AR 89 - AR 91 Rate of recordable work-related accidents for own workforce 66 GRI 403: Occupational health and safety 2018: 403-9 Work- related injuries S1 S1-14 88 d Number of cases of recordable work-related ill health of employees 66 GRI 403: Occupational health and safety 2018: 403-10 Work- related ill health S1 S1-14 88 e AR 95 Number of days lost to work-related injuries and fatalities from work-related accidents, work-related ill health and fatalities from ill health related to employees 66 S1 S1-17 103 a Number of incidents of discrimination and harassment [table] 67 GRI 406: Non-discrimination 2016: 406-1 Incidents of discrimination and corrective action taken S1 S1-17 103 d AR 103-AR 106 Disclosure of contextual information necessary to understand data and how data has been compiled (work- related grievances, incidents and complaints related to social and human rights matters) 67 GRI 2: General Disclosures 2021: 2-27 Compliance with laws and regulations S1 S1-17 104 a AR 103-AR 106 No severe human rights incidents connected to own workforce have occurred 67 GRI 3: Material topics 2021: 3-3 Management of material topics S2 S2.SBM-3 11 a Description of types of value chain workers subject to material impacts 68 S2 S2.SBM-3 11 d Description of activities that result in positive impacts and types of value chain workers that are positively affected or could be positively affected 69 S2 S2.SBM-3 11 e Description of material risks and opportunities arising from impacts and dependencies on value chain workers 68 S2 S2-1 17 Description of relevant human rights policy commitments relevant to value chain workers 69–71 GRI 2: General Disclosures 2021: 2-23 Policy commitments S2 S2-1 17a Disclosure of general approach in relation to respect for human rights relevant to value chain workers 70 GRI 2: General Disclosures 2021: 2-23 Policy commitments S2 S2-1 17b Disclosure of general approach in relation to engagement with value chain workers 69 GRI 2: General Disclosures 2021: 2-23 Policy commitments GRI 2: General Disclosures 2021: 2-29 Approach to stakeholder engagement ABB SUSTAINABILITY STATEMENT 2024 115 ESRS reference Related AR Name Location GRI 1 ISSB 2 S2 S2-1 17 c Disclosure of general approach in relation to measures to provide and (or) enable remedy for human rights impacts 69–70 GRI 2: General Disclosures 2021: 2-23 Policy commitments GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts S2 S2-1 18 Policies explicitly address trafficking in human beings, forced labor or compulsory labor and child labour 70 GRI 3: Material topics 2021: 3-3 Management of material topics GRI 408:Child labor 2016: 408-1 Operations and suppliers at significant risk for incidents of child labor GRI 409: Forced or compulsary labor 2016: 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor S2 S2-1 18 Undertaking has supplier code of conduct 70 GRI 2: General Disclosures 2021: 2-24 Embedding policy commitments S2 S2-1 19 AR 14 Disclosure of whether and how policies are aligned with relevant internationally recognized instruments 70 GRI 2: General Disclosures 2021: 2-23 Policy commitments S2 S2-1 19 Disclosure of extent and indication of nature of cases of non-respect of the UN Guiding Principles on Business and Human Rights, ILO Declaration on Fundamental Principles and Rights at Work or OECD Guidelines for Multinational Enterprises that involve value chain workers 70 S2 S2-2 22 AR 20 Disclosure of whether and how perspectives of value chain workers inform decisions or activities aimed at managing actual and potential impacts 71 GRI 3: Material topics 2021: 3-3 Management of material topics S2 S2-2 22 a Engagement occurs with value chain workers or their legitimate representatives directly, or with credible proxies 71 GRI 3: Material topics 2021: 3-3 Management of material topics S2 S2-2 22 b AR 18 Disclosure of stage at which engagement occurs, type of engagement and frequency of engagement 71 GRI 3: Material topics 2021: 3-3 Management of material topics S2 S2-2 22 c AR 17 - AR 18 Disclosure of function and most senior role within undertaking that has operational responsibility for ensuring that engagement happens and that results inform undertakings approach 71 GRI 3: Material topics 2021: 3-3 Management of material topics S2 S2-3 27 b AR 22 Disclosure of specific channels in place for value chain workers to raise concerns or needs directly with undertaking and have them addressed 72 GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts S2 S2-3 27 c Disclosure of processes through which undertaking supports or requires availability of channels 72 S2 S2-3 27 d AR 27 Disclosure of how issues raised and addressed are tracked and monitored and how effectiveness of channels is ensured 72 S3 S3.SBM-3 9 a) AR 7 Description of types of affected communities subject to material impacts 73 S3 S3.SBM-3 9 c Description of activities that result in positive impacts and types of affected communities that are positively affected or could be positively affected 73 S3 S3.SBM-3 9 d Description of material risks and opportunities arising from impacts and dependencies on affected communities 73 S3 S3-1 15 Disclosure of any particular policy provisions for preventing and addressing impacts on indigenous peoples 74 S3 S3-1 16 Description of relevant human rights policy commitments relevant to affected communities 74 GRI 2: General Disclosures 2021: 2-23 Policy commitments S3 S3-1 16 a Disclosure of general approach in relation to respect for human rights of communities, and indigenous peoples specifically 74 GRI 2: General Disclosures 2021: 2-23 Policy commitments 116 ABB SUSTAINABILITY STATEMENT 2024 ESRS reference Related AR Name Location GRI 1 ISSB 2 S3 S3-1 17 AR 10 Disclosure of whether and how policies are aligned with relevant internationally recognized instruments 70 GRI 2: General Disclosures 2021: 2-23 Policy commitments S3 S3-3 27 b Disclosure of specific channels in place for affected communities to raise concerns or needs directly with undertaking and have them addressed 75 GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts GRI 413: Local communities 2016: 413-1 Operations with local community engagement, impact assessments, and development programs S3 S3-3 27 d Disclosure of how issues raised and addressed are tracked and monitored and how effectiveness of channels is ensured 75 S4 S4.SBM-3 10 a Description of types of consumers and end-users subject to material impacts 76 S4 S4.SBM-3 10 c Description of activities that result in positive impacts and types of consumers and end-users that are positively affected or could be positively affected 76 S4 S4.SBM-3 10 d Description of material risks and opportunities arising from impacts and dependencies on consumers and end- users 76 S4 S4-1 16 Description of relevant human rights policy commitments relevant to consumers and/or end-users 76 GRI 2: General Disclosures 2021: 2-23 Policy commitments S4 S4-1 16 a Disclosure of general approach in relation to respect for human rights of consumers and end-users 76 GRI 2: General Disclosures 2021: 2-23 Policy commitments S4 S4-1 16 c Disclosure of general approach in relation to measures to provide and (or) enable remedy for human rights impacts 76 GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts GRI 3: Material topics 2021: 3-3 Management of material topics S4 S4-3 25 b AR 19 Disclosure of specific channels in place for consumers and end-users to raise concerns or needs directly with undertaking and have them addressed 77 GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts S4 S4-3 25 c Disclosure of processes through which undertaking supports or requires availability of channels 77 GRI 2: General Disclosures 2021: 2-25 Processes to remediate negative impacts S4 S4-3 25 d AR 24 Disclosure of how issues raised and addressed are tracked and monitored and how effectiveness of channels is ensured 77 G1 G1.GOV-1 5a Disclosure of role of administrative, management and supervisory bodies related to business conduct 79 GRI 2: General Disclosures 2021: 2-12 Role of the highest governance body in overseeing the management of impacts G1 G1.GOV-1 5 b Disclosure of expertise of administrative, management and supervisory bodies on business conduct matters 79 GRI 2: General Disclosures 2021: 2-9 Governance structure and composition G1 G1-1 9 AR 1 Description of how the undertaking establishes, develops, promotes and evaluates its corporate culture 79 GRI 2: General Disclosures 2021: 2-16: Communication of critical concerns GRI 2: General Disclosures 2021: 2-23, Policy commitments GRI 2: General Disclosures 2021: 2-24: Embedding policy commitments G1 G1-1 10a Description of the mechanisms for identifying, reporting and investigating concerns about unlawful behavior or behavior in contradiction of its code of conduct or similar internal rules 83 GRI 2: General Disclosures 2021: 2-26 Mechanisms for seeking advice and raising concerns G1 G1-1 10 e Undertaking is committed to investigate business conduct incidents promptly, independently and objectively 83 G1 G1-1 10 g Information about policy for training within organization on business conduct 83 GRI 2: General Disclosures 2021: 2-24 Embedding policy commitments G1 G1-2 15 a AR 2 - AR 3 Description of approaches in regard to relationships with suppliers, taking account risks related to supply chain and impacts on sustainability matters 84 GRI 3: Material topics 2021: 3-3 Management of material topics ABB SUSTAINABILITY STATEMENT 2024 117 ESRS reference Related AR Name Location GRI 1 ISSB 2 G1 G1-2 15 b AR 2 - AR 3 Disclosure of whether and how social and environmental criteria are taken into account for selection of supply-side contractual partners 84–87 GRI 308: Supplier Environmental Assessment 2016: 308-1 New suppliers that were screened using environmental criteria GRI 414:Supplier Social Assessment 2016: 414-1 New suppliers that were screened using social criteria G1 G1-3 18 a AR 5 - AR 6 Information about procedures in place to prevent, detect, and address allegations or incidents of corruption or bribery 88 GRI 2: General Disclosures 2021: 2-26 Mechanisms for seeking advice and raising concerns GRI 3: Material Topics 2021: 3-3 Management of material topics G1 G1-3 20 Information about how policies are communicated to those for whom they are relevant (prevention and detection of corruption or bribery) 88–89 GRI 205: Anti-corruption 2016: 205-2 Communication and training about anti-corruption policies and procedures G1 G1-3 21 a Information about nature, scope and depth of anti- corruption or anti-bribery training programs offered or required 89–91 1 Please note that we are using ESRS definitions and breakdowns whenever the definitions and breakdowns provided by GRI differed from the one required by ESRS 2 Please note that we are using ESRS definitions and breakdowns whenever the definitions and breakdowns provided by ISSB differed from the one required by ESRS 118 ABB SUSTAINABILITY STATEMENT 2024 — LIST OF DATAPOINTS IN CROSS-CUTTING AND TOPICAL STANDARDS THAT DERIVE FROM OTHER EU LEGISLATION Location SFDR reference Pillar 3 reference Benchmark Regulation reference EU Climate Law reference ESRS 2 GOV-1 21 d Percentage of members of administrative, management and supervisory bodies by gender and other aspects of diversity; Board's gender diversity ratio 6 ● ● ESRS 2 GOV-1 21 e Percentage of independent board members 6 ● ESRS 2 GOV-4 30 Disclosure of mapping of information provided in sustainability statement about due diligence process 10–11 ● E1-4 34 GHG emission reduction targets 31 ● ● ● E1-5 37 Energy consumption and mix, disaggregated by sources 33 ● E1-5 38 Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) 33 ● ABB SUSTAINABILITY STATEMENT 2024 119 Location SFDR reference Pillar 3 reference Benchmark Regulation reference EU Climate Law reference E1-6 44 Gross scopes 1, 2, 3 and total GHG emissions - GHG emissions per scope [table] 34 ● ● ● E1-6 53-55 GHG emissions intensity, location-based (total GHG emissions per net revenue) 34 ● ● ● E5-5 37 d Non-recycled waste; Percentage of non-recycled waste 41 ● E5-5 39 Total amount of hazardous waste 41 ● S1-1 20 Description of relevant human rights policy commitments relevant to own workforce 59 ● S1-1 21 Disclosure of whether and how policies are aligned with relevant internationally recognized instruments 59 ● S1-1 23 Workplace accident prevention policy or management system is in place 59 ● S1-3 32 c Grievance or complaints handling mechanisms related to employee matters exist 62 ● 120 ABB SUSTAINABILITY STATEMENT 2024 Location SFDR reference Pillar 3 reference Benchmark Regulation reference EU Climate Law reference S1-14 88 b, c Number of fatalities in own workforce as result of work- related injuries and work-related ill health; Number of recordable work-related accidents for own workforce. 66 ● ● S1-14 88 e Number of days lost to work-related injuries and fatalities from work-related accidents, work-related ill health and fatalities from ill health related to employees 66 ● S1-17 103 a Number of incidents of discrimination and harassment [table] 67 ● S1-17 104 a No severe human rights issues and incidents connected to own workforce have occurred 67 ● ● S2-1 17 Description of relevant human rights policy commitments relevant to value chain workers 69–71 ● S2-1 18 Policies explicitly address trafficking in human beings, forced labor or compulsory labor and child labour; Undertaking has supplier code of conduct 70 ● S2-1 19 Disclosure of extent and indication of nature of cases of non-respect of the UN Guiding Principles on Business and Human Rights, ILO Declaration on Fundamental Principles 70 ● ● S2-1 19 Disclosure of whether and how policies are aligned with relevant internationally recognized instruments. 70 ● ABB SUSTAINABILITY STATEMENT 2024 121 Location SFDR reference Pillar 3 reference Benchmark Regulation reference EU Climate Law reference S3-1 16 Description of relevant human rights policy commitments relevant to affected communities 74 ● S3-1 17 Disclosure of whether and how policies are aligned with relevant internationally recognized instruments 70 ● ● S4-1 16 Description of relevant human rights policy commitments relevant to consumers and/or end-users 76 ● 122 ABB SUSTAINABILITY STATEMENT 2024 — GRI CONTENT INDEX Statement of use ABB Ltd has reported the information cited in this GRI content index for the period 1 january 2024 to 31 December 2024 with reference to the GRI Standards. GRI 1 used GRI 1: Foundation 2021 Applicable GRI Sector Standard(s) Not applicable GRI STANDARD DISCLOSURE LOCATION All relevant standards For GRI disclosures other than GRI 301: Materials 2016 and GRI 302: Energy 2016 (as included below) refer to the ESRS Content Index, including GRI and ISSB interoperability above GRI 301: Materials 2016 301-1 Materials used by weight or volume 42 GRI 302: Energy 2016 302-3 Energy intensity 33 ABB SUSTAINABILITY STATEMENT 2024 123 — SASB - ELECTRICAL & ELECTRONIC EQUIPMENT Topic Metric Category Unit of Measure Code ABB answer Energy Management a. Total Energy Consumed (Gigajoules) Quantitative Gigajoules (GJ) RT-EE-130a.1 4650400.8 b. Percentage Grid Electricity (%) Percentage (%) 68% c. Percentage Renewable (%) Percentage (%) 69% Hazardous Waste Management a. Amount of hazardous waste generated, percentage recycled (Metric tons, %) Quantitative Metric tons (t), Percentage (%) RT-EE-150a.1 6201, 60% (Increase due to warehouse clean- ups in several sites for electronics) b. Number and aggregate quantity of reportable spills, quantity recovered (Number, Kilograms) Number, kilograms (kg) RT-EE-150a.2 1 spill, 470 liters of oil, none recovered . Product Safety a. Number of recalls issued, total units recalled (Number) Quantitative Number RT-EE-250a.1 a. As of 2024, this number is not available on an aggregated level at ABB. b. Total amount of monetary losses as a result of legal proceedings associated with product safety Presentation currency RT-EE-250a.2 b. Not applicable. Due to NDA agreements with third parties, we are unable to disclose monetary values resulting from legal proceedings with these third parties. Product Lifecycle Management a. Percentage of products by revenue that contain IEC 62474 declarable substances (% by revenue) Quantitative Percentage (%) by revenue RT-EE-410a.1 As of 2024, we are unable to respond to this question. Please refer to the section “Circularity” in the Sustainability Statement. b. Percentage of eligible products, by revenue, certified to an energy efficiency certification (% by revenue) Percentage (%) by revenue RT-EE-410a.2 Only applicable to North America products. All ABB products are included in point c. c. Revenue from renewable energy related and energy efficiency related products (Reporting currency) Presentation currency RT-EE-410a.3 Using the EU taxonomy as reference: In 2024, ABB reached a 0% Taxonomy-aligned revenue under the Climate Change Mitigation environmental objective that covers partially this requirement. For further details please refer to ABB's EU Taxonomy disclosures in the Sustainability Statement. 124 ABB SUSTAINABILITY STATEMENT 2024 Topic Metric Category Unit of Measure Code ABB answer Materials sourcing a. Description of the management risks associated with the use of critical materials (Discussion & Analysis) Discussion and Analysis n.a. RT-EE-440a.1 Please refer to the sections “Circularity” and “Responsible sourcing” in the Sustainability Statement. Business ethics Description of policies and practices for prevention of: a. Corruption and bribery and anti-competitive behavior (Discussion & Analysis) Discussion and Analysis n.a. RT-EE-510a.1 Please refer to the section “Integrity and transparency” in the Sustainability Statement. b. Total amount of monetary losses as a result of legal proceedings associated with bribery or corruption (Reporting currency); Quantitative Presentation currency RT-EE-510a.2 b. Immaterial amount associated with the resolution in Germany of the legacy Kusile enforcement matter. c. Total amount of monetary losses as a result of legal proceedings associated with anti- competitive behavior regulations (Reporting currency) Quantitative Presentation currency RT-EE-510a.3 — Activity Metrics a. Number of units produced (Production should be disclosed as number of units produced by product category, where relevant product categories include energy generation, energy delivery, and lighting and indoor climate control electronics.) Quantitative Number RT-EE-000.A Please refer to the section “Analysis of results of operations” in the Financial Report 2024. b. Number of Employees Number RT-EE-000.B 112769 125 Independent limited assurance report on selected sustainability information in ABB Ltd’s Sustainability Statement 2024 To the Board of Directors of ABB Ltd, Zurich We have undertaken a limited assurance engagement on the following selected sustainability information, which are marked as “assured”, in the Sustainability Statement of ABB Ltd and its subsidiaries (herein after “ABB”) for the year ended December 31, 2024 (hereinafter “Sustainability Information”): Global Reporting Initiative (GRI) related KPIs 301-1 Materials used by weight and volume (Metals used) 302-1 Total energy consumption 302-3 Total energy intensity Disclosures on the process of the Double Materiality Assessment (DMA) carried out by ABB European Sustainability Reporting Standards (ESRS) related disclosures Energy consumption from fossil sources (ESRS E1-5 37a) Energy consumption from renewable sources (ESRS E1-5 37c) Gross Scopes 1,2,3 and Total GHG emissions (ESRS E1-6 44) GHG emission intensity, location & market based (ESRS E1-6 53) Avoided Emissions The 2024 value of the avoided emissions ambition reported in the ABB sustainability targets table on page 31 of the Sustainability Statement. ABB sustainability targets The 2024 status for the ABB sustainability 2030 targets, within the tables presented on pages 31 , 41, 58, 73, 85, 87, and 88 of the Sustainability Statement. Non-financial disclosures Non-financial disclosures in accordance with article 964b of the Swiss Code of Obligation (CO), as included in the index table on page 102 and 103 of the Sustainability Statement. Disclosures in the subsection 'EU Taxonomy: Disclosures for Financial Year 2024’ on pages 46 to 55 and the subsection ‘EU Taxonomy: 2024 Tables’ on pages 91 to 101 of the Sustainability Statement Our Limited Assurance Conclusion Based on the procedures we have performed as described under the ‘Summary of the work we performed as the basis for our assurance conclusion’ and the evidence we have obtained, nothing has come to our attention that causes us to believe that the Sustainability Information is not prepared, in all material respects, in accordance with the Sustainability Reporting Criteria, as defined below. Our assurance engagement and our conclusion do not extend to information in respect of earlier periods or to any other information included in the Sustainability Statement or within the ABB Annual Reporting Suite (consisting of the Integrated Report, the Financial Report, the Corporate Governance Report, and the Compensation Report) or any other information linked to from the Sustainability Information or from the Sustainability Statement, including any images, audio files or embedded videos. 126 Understanding how ABB has Prepared the Sustainability Information ABB prepared the Sustainability Information using the following criteria (hereinafter referred to as the "Sustainability Reporting Criteria”): For GRI related KPIs - GRI Standards; - For the DMA- ESRS 2- I RO1; For ESRS related disclosures - ESRS standards; For avoided emissions - internally developed criteria and methodology based on Guidance on Avoided Emissions, issued by the World Business Council for Sustainable Development (WBCSD), as included on pages 36 to 37 of the Sustainability Statement; For ABB sustainability targets - ESRS Standards for Emission reduction targets, GRI Standards for Waste to landfill and Zero harm targets; ABB self-developed criteria for the remaining of the ABB sustainability targets, as included on pages 58, 73, 85, 87 and 88 of the Sustainability Statement; For the non-financial disclosures referenced in the index table on page 102 and 103 of the Sustainability Statement - article 964b of the Swiss Code of Obligation; For EU-Taxonomy disclosures - Article 8 of Regulation (EU) 2020/852 of the European Parliament and of the Council of 1 8 June 2020 on establishing a framework to facilitate sustainable investment and amending Regulation (EU) 2019/2088 Consequently, the Sustainability Information needs to be read and understood together with the Sustainability Reporting Criteria, including the self-developed criteria. We believe that these criteria are a suitable basis for our limited assurance engagement. Inherent Limitations in Preparing the Sustainability Information Due to the inherent limitations of any internal control structure, it is possible that errors or irregularities may occur in disclosures of the Sustainability Information and not be detected. Our engagement is not designed to detect all internal control weaknesses in the preparation of the Sustainability Information because the engagement was not performed on a continuous basis throughout the period and the limited assurance procedures performed were on a test basis. The calculation of avoided emissions described on pages 36 to 37 of the Sustainability Statement includes several inherently judgmental assumptions derived from internal ABB sources and analyses and external data for comparison purposes is limited or not available. In time, as the external guidance in the sector evolves and data precision improves, the determination of avoided emissions will be subject to less judgement and less estimation uncertainty. ABB’s Responsibilities The Board of Directors of ABB is responsible for: Selecting or establishing suitable criteria for preparing the Sustainability Information, taking into account applicable law and regulations related to reporting the Sustainability Information; The preparation of the Sustainability Information in accordance with the Sustainability Reporting Criteria; Designing, implementing and maintaining internal control over information relevant to the preparation of the Sustainability Information that is free from material misstatement, whether due to fraud or error. 127 Our Responsibilities We are responsible for: Planning and performing the engagement to obtain limited assurance about whether the Sustainability Information is free from material misstatement, whether due to fraud or error; Forming an independent conclusion, based on the procedures we have performed and the evidence we have obtained; and Reporting our independent conclusion to the Board of Directors of ABB. As we are engaged to form an independent conclusion on the Sustainability Information as prepared by the Board of Directors, we are not permitted to be involved in the preparation of the Sustainability Information as doing so may compromise our independence. Professional Standards Applied We performed a limited assurance engagement in accordance with International Standard on Assurance Engagements 3000 (Revised) Assurance Engagements other than Audits or Reviews of Historical Financial Information, issued by the International Auditing and Assurance Standards Board (IAASB). Our Independence and Quality Control We have complied with the independence and other ethical requirements of the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code), which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality, and professional behavior. Our firm applies International Standard on Quality Management 1, which requires the firm to design, implement and operate a system of quality management including policies or procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. Our work was carried out by an independent and multidisciplinary team including assurance practitioners and sustainability experts. We remain solely responsible for our assurance conclusion. Summary of the Work we Performed as the Basis for our Assurance Conclusion We are required to plan and perform our work to address the areas where we have identified that a material misstatement of the Sustainability Information is likely to arise. The procedures we performed were based on our professional judgment. Carrying out our limited assurance engagement on the Sustainability Information included, among others: Assessing the design and implementation of systems, processes and internal controls for determining, processing and monitoring sustainability performance data, including the consolidation of data; obtaining an understanding of ABBs process to identify material information for reporting; Obtaining an understanding of the ABB’s process to identify taxonomy-eligible and taxonomy-aligned economic activities and the corresponding disclosures in the Sustainability Statement. Inquiring of employees responsible for the determination and consolidation as well as the implementation of internal control procedures regarding the selected disclosures; Inspecting selected internal and external documents to determine whether quantitative and qualitative information is supported by sufficient evidence and presented in an accurate and balanced manner; Assessing the data collection, validation and reporting processes as well as the reliability of the reported data on a test basis and through testing of selected calculations; 128 Analytically assessing the data and trends of the quantitative disclosures included in the scope of the limited assurance engagement; With respect to the avoided emissions calculated by ABB, reviewing the internally developed methodology based on the World Business Council for Sustainable Development (WBCSD) guidance, inquired management about the assumptions applied and the sources behind them and reviewed whether the calculation was performed in line with the methodology; Checking that the Sustainability Statement contains the information required by article 964b para. 1 and 2 CO to understand the business performance, the business results, the state of the undertaking and the effects of its activity on environmental matters, social matters, employee-related matters, respect for human rights and combating bribery and corruption, as well disclosures on environmental matters as required by article 964b para. 2 CO to contain the information laid out in the Ordinance on Climate Disclosures; Assessing of the consistency of the disclosures applicable to ABB with the other disclosures and key figures and of the overall presentation of the disclosures through critical reading of the Sustainability Statement. The procedures performed in a limited assurance engagement vary in nature and timing from, and are less in extent than for, a reasonable assurance engagement. Consequently, the level of assurance obtained in a limited assurance engagement is substantially lower than the assurance that would have been obtained had we performed a reasonable assurance engagement. KPMG AG Achim Wolper Licensed Audit Expert Mohamad Midani Zurich, Switzerland February 26, 2025 © 2025 KPMG AG, a Swiss corporation, is a group company of KPMG Holding LLP, which is a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. QZp27 EXPERTsuiosc-zc'ffiz clco Urccmcl'rron ABB SUSTAINABILITY STATEMENT 2024 129 — DEFINITIONS — Greenhouse gas emissions Greenhouse gas (GHG) emissions refer to all emissions that have a warming effect on the earth’s surface by trapping heat in the atmosphere. The Greenhouse Gas Protocol, which sets global standards to measure and manage GHG emissions, covers seven GHGs: carbon dioxide (CO 2 ), methane (CH 4 ), nitrous oxide (N 2 O), as well as gases used in industry, including hydrofluorocarbons (HFCs), per-fluorocarbons (PCFs), sulfur hexafluoride (SF 6 ). and nitrogen trifluoride (NF 3 ). CO 2 , CH 4 , and N 2 O are released during the combustion of fossil fuels, such as coal, oil, or natural gas. At ABB, we use the metric ton of CO 2 - equivalent (CO 2 e) to calculate our GHG emissions and to measure progress toward our emissions reduction targets. — Scope 1 GHG emissions Direct emissions from company-owned and controlled resources, for example, emissions from combustion in owned or controlled boilers, furnaces, vehicles. — Scope 2 GHG emissions Indirect emissions from the generation of purchased energy (electricity, steam, heat, cooling) from an utility provider. — Scope 3 GHG emissions All other indirect emissions not included in scope 2 that occur in the value chain, both upstream and downstream. According to the GHG protocol, scope 3 emissions are separated into 15 categories and include, for example, purchased goods and services, business travel and commuting, and use of sold products. — Science Based Targets initiative (SBTi) The SBTi is a global collaboration that enables businesses to set ambitious emissions reduction targets in line with the latest climate science. It independently assesses and approves companies’ targets based on strict criteria. 04 Chairman’s Letter 06 Summary of our corporate governance approach 07 Board of Directors 13 Executive Committee 16 Shares 19 Shareholders 22 Independent external auditors 24 Other governance information 25 Information policy 4 ABB CORPORATE GOVERNANCE REPORT 2024 — CHAIRMAN’S LETTER DEAR SHAREHOLDERS, The past year was one of change but also of continuity. Morten Wierod succeeded Björn Rosengren as CEO and two of our division presidents, Giampiero Frisio and Brandon Spencer, were promoted to the Executive Committee (EC) to head our Electrification and Motion business areas. We also welcomed Mathias Gaertner as our new General Counsel and Company Secretary. What continued was the strong financial performance of our businesses and our successful ABB Way operating model, which Morten and his EC colleagues played an important role in implementing and which we will continue to follow. Beyond ABB, the US elections signaled a different agenda for the world’s largest economy. But the challenges facing society, such as geopolitical instability, climate change and shrinking workforces, remain much the same. Despite the uncertainties, what makes me optimistic is the impressive and accelerating technological advances that we are seeing, especially in artificial intelligence, and what ABB can offer in this field. Today, ABB’s employees around the world are working with generative AI tools and we have more than 250 AI projects underway across the company. In 2024, we launched many new AI-powered solutions, from vision technology for robots to energy management software for industries and data centers. Our Electrification business is doing particularly well thanks to its strong position as a supplier of power technologies to data centers, which are expanding at a rapid rate to manage the demands of AI. In short, ABB is both enabling AI as well as using it to help industries become more efficient, productive and sustainable. Fully committed to our Sustainability Agenda With most of our divisions having achieved their profitability targets, Morten and his team now have a mandate to drive profitable growth and achieve our ambitious sustainability targets. Some companies may have pulled back on their sustainability commitments, but ABB is not one of them. We remain firmly committed to our Sustainability Agenda that we announced in 2023. This year, we published ABB’s first Sustainability Statement with reference to the European Sustainability Reporting Standards (ESRS). This is in preparation for the mandatory reporting requirements of the European Union’s Corporate Sustainability Reporting Directive (CSRD) starting from financial year 2025. The CSRD increases companies’ reporting obligations concerning the impact of their activities on society and the environment. Being responsible for sustainability governance, the Board reviews and approves ABB’s Sustainability Agenda and related targets, monitors progress and ensures that ABB’s executive compensation policies are appropriately aligned to the Sustainability Agenda. Our Finance, Audit and Compliance Committee (FACC) is responsible for the integrity of ABB’s sustainability-related reporting. Our business areas and divisions are fully accountable for their sustainability performance. Enhanced anti-bribery and anti-corruption controls In 2024, we continued to enhance our anti-bribery and anti-corruption controls in line with a three-year Deferred Prosecution Agreement (DPA) with the United States Department of Justice and Securities and Exchange Commission. We are now in the third and final year of the DPA and will continue to self- report on enhancements to our integrity program to ensure that our controls, processes and culture serve as effective deterrents to bribery and corruption, and support transparent and sustainable business practices. The Board of Directors is responsible for overseeing compliance with the requirements of the DPA. ABB CORPORATE GOVERNANCE REPORT 2024 5 Board composition In 2024, we welcomed two new members to the Board of Directors, Johan Forssell and Mats Rahmström, both of whom bring valuable industry experience to the Board. At our annual general meeting in March, we will be proposing a new Board member for election. We look forward to introducing Claudia Nemat, who is a member of the management board of Deutsche Telekom, responsible for technology and innovation, including networks, IT, products, as well as information and cyber security. She has previous board experience at Lanxess and Airbus. With her focus on digital and the impact of new technologies like artificial intelligence, Claudia will perfectly complement the competencies of our Board. We will also be saying goodbye to Lars Förberg, who has decided not to stand for re-election in 2025. On behalf of ABB and our entire Board of Directors, I would like to thank Lars for his outstanding contribution to ABB’s successful transformation over the past years. I wish him all the best for his future endeavors. With these changes, our Board of Directors has a wide diversity of industry knowledge, skills and experience as well as a more equal gender balance. Board assessment Every year, the Board conducts an internal assessment in which each member assesses the Board’s composition, processes, culture and relationship with executive management, as well as its responsibilities, performance and the role of the Chairman. This year’s assessment concluded that the succession process for the new CEO was very well structured and inclusive. It also found that our two new Board members had been successfully integrated, contributed valuable experience to the Board, and that collaboration was at a very high level. We had planned to substitute our internal assessment with an external review. However, in light of all the changes to the Board and Executive Committee, we decided to postpone an external review until 2025. I look forward to communicating its findings in next year’s report. On behalf of the Board of Directors, I would like to thank you for your trust and support. Peter Voser Chairman of the Board of Directors Zurich, February 26, 2025 6 ABB CORPORATE GOVERNANCE REPORT 2024 — SUMMARY OF CORPORATE GOVERNANCE APPROACH CORPORATE GOVERNANCE – GENERAL PRINCIPLES ABB is committed to the highest international standards of corporate governance, and this is reinforced in its structure, processes and rules as outlined in this report. In line with this, ABB complies with the general principles as set forth in the Swiss Code of Best Practice for Corporate Governance, as well as those of the capital markets where its shares are listed and traded. In addition to the provisions of the Swiss Code of Obligations, ABB’s key principles and rules on corporate governance are laid down in ABB’s Articles of Incorporation, the ABB Ltd Board Governance Rules (which include the governance rules of ABB’s Board committees and the ABB Ltd Related Party Transaction Policy, which defines the criteria to determine the independence of the members of ABB Ltd’s Board of Directors), and the ABB Code of Conduct. These documents are available on ABB’s website at https://new.abb.com/about/corporate-governance. It is the duty of ABB’s Board of Directors (the Board) to review and amend or propose amendments to those documents from time to time to reflect the most recent developments and practices, as well as to ensure compliance with applicable laws and regulations. Shareholders and other interested parties may communicate with the Chairman of the Board or the independent directors by writing to ABB Ltd (Attn: Chairman of the Board/independent directors), at Affolternstrasse 44, CH- 8050 Zurich, Switzerland. COMPENSATION GOVERNANCE AND BOARD AND EC COMPENSATION Information about ABB’s compensation governance as well as Board and Executive Committee (the EC) compensation and shareholdings is provided in the Compensation Report 2024. ABB CORPORATE GOVERNANCE REPORT 2024 7 — BOARD OF DIRECTORS BOARD AND BOARD COMMITTEES (2024–2025 BOARD TERM) Board of Directors Chairman: Peter R. Voser David Constable Jennifer Xin-Zhe Li Frederico Fleury Curado Geraldine Matchett Lars Förberg David Meline Johan Forssell Mats Rahmström Denise C. Johnson Finance, Audit and Compliance Committee Governance and Nomination Committee Compensation Committee David Meline (chairman) Peter R. Voser (chairman) Frederico Fleury Curado (chairman) Denise C. Johnson Lars Förberg David Constable Geraldine Matchett Johan Forssell Jennifer Xin ‑ Zhe Li Mats Rahmström Jennifer Xin-Zhe Li BOARD GOVERNANCE The Board The Board defines the strategy and ultimate direction of the business of ABB and issues the necessary instructions. It determines the organization of the ABB Group and appoints, supervises and removes the persons entrusted with the executive management and representation of ABB. The internal organizational structure and the definition of the areas of responsibility of the Board, as well as the information and control instruments vis-à-vis the Executive Committee are set forth in the ABB Ltd Board Governance Rules (available at https://new.abb.com/about/corporate-governance). The Board takes decisions as a whole, supported by its three committees: the Finance, Audit and Compliance Committee (the FACC), the Governance and Nomination Committee (the GNC), and the Compensation Committee (the CC). These committees assist the Board in its tasks and report regularly to the Board. The Board and its committees meet regularly throughout the year. The directors and officers of a Swiss corporation are bound, as specified in the Swiss Code of Obligations, to perform their duties with all due care, to safeguard the interests of the corporation in good faith and to extend equal treatment to shareholders in like circumstances. Prior to proposing new candidates for election to the Board, checks are performed to ensure that they are independent and that there are no conflicts of interest. The Swiss Code of Obligations does not specify what standard of due care is required of the directors of a corporate board. However, it is generally held by Swiss legal scholars and jurisprudence that the directors must have the requisite capability and skills to fulfill their function, and must devote the necessary time to the discharge of their duties. Moreover, the directors must exercise all due care that a prudent and diligent director would have taken in like circumstances. Finally, the directors are required to take actions in the best interests of the corporation and may not take any actions that may be harmful to the corporation. Although the Swiss Code of Obligations does not discuss specifically conflicts of interest for board members, the ABB Ltd Board Governance Rules (available at https://new.abb.com/about/corporate-governance) state that Board members shall avoid entering into any situation in which their personal or financial interests may conflict with the interests of ABB. 8 ABB CORPORATE GOVERNANCE REPORT 2024 Chairman of the Board The Chairman is elected by the shareholders to represent their interests in creating sustainable value through effective governance. In addition, the Chairman (1) takes provisional decisions on behalf of the Board on urgent matters where a regular Board decision cannot be obtained, (2) calls for Board meetings and sets the related agendas, (3) interacts with the CEO and other EC members on a more frequent basis outside of Board meetings and (4) represents the Board internally and in the public sphere. Vice-Chairman of the Board The Board may appoint a Vice-Chairman to handle the responsibilities of the Chairman if the Chairman is unable to do so or would have a conflict of interest in doing so. Finance, Audit and Compliance Committee The FACC is responsible for overseeing (1) the integrity of ABB’s financial and sustainability-related statements, (2) ABB’s compliance with legal, tax and regulatory requirements, (3) the external auditors’ qualifications and independence, (4) the performance and role of ABB’s internal audit function and the performance of the external auditors, (5) ABB’s capital structure, funding requirements and financial and risk policies, and (6) ABB’s implementation and maintenance of an integrity program and internal controls designed to mitigate integrity risk. The FACC must comprise three or more independent directors who have a thorough understanding of finance, accounting and auditing in a corporate environment. The Chairman of the Board and, upon invitation by the committee’s chairman, the CEO or other members of the Executive Committee may participate in the committee meetings, provided that any potential conflict of interest is avoided and confidentiality of the discussions is maintained. In addition, the chief integrity officer, the head of internal audit and the external auditors participate in the meetings as appropriate. Governance and Nomination Committee The GNC is responsible for (1) overseeing corporate governance practices within ABB, (2) overseeing ABB’s Sustainability Agenda, (3) nominating candidates for the Board, the role of the CEO and other positions on the Executive Committee, and (4) succession planning and employment matters relating to the Board and the Executive Committee. The GNC is also responsible for maintaining an orientation program for new Board members and an ongoing education program for existing Board members. The GNC must comprise three or more independent directors. Upon invitation by the committee’s chairman, the CEO or other members of the Executive Committee may participate in the committee meetings, provided that any potential conflict of interest is avoided and confidentiality of the discussions is maintained. Compensation Committee The CC is responsible for compensation matters relating to the Board and the Executive Committee. The CC must comprise three or more directors who are elected by the shareholders. The Chairman of the Board and, upon invitation by the committee’s chairman, the CEO or other members of the Executive Committee may participate in the committee meetings, provided that any potential conflict of interest is avoided and confidentiality of the discussions is maintained. BOARD MEMBERSHIP Board composition In proposing individuals for election, the Board seeks to align its composition, skills and experience with the Company’s strategic needs, business portfolio, geographic reach and culture. The Board strives for diversity in all aspects including gender, nationalities, ethnicity, and age. In addition, the tenure of the members of the Board should be well ‑ balanced. The Board also considers the number of other mandates of each Board member to ensure that he/she will have sufficient time to dedicate to his/her role as an ABB Board member. ABB CORPORATE GOVERNANCE REPORT 2024 9 Elections and term of office The members of the Board of Directors and the Chairman of the Board as well as the members of the Compensation Committee are elected by the shareholders at the general meeting of shareholders for a term of office extending until completion of the next ordinary general meeting of shareholders. Members whose terms of office have expired shall be immediately eligible for re ‑ election. ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate-governance) do not provide for the retirement of directors based on their age. However, an age limit for members of the Board is set forth in the ABB Ltd Board Governance Rules (available at https://new.abb.com/about/corporate-governance), although waivers are possible and subject to Board discretion. If the office of the Chairman of the Board of Directors or any position on the Compensation Committee becomes vacant during a Board term, the Board of Directors may appoint (shall appoint in the case of the Chairman of the Board) another individual from among its members to that position for the remainder of that term. The Board of Directors shall consist of no less than 7 and no more than 13 members. MEMBERS OF THE BOARD (2024–2025 BOARD TERM) Board Experience Corporate Officer Experience Other Business Experience Global Experience Country of Origin / Nationality Gender Non-Executive Independent Board Member ABB Board Tenure (years) Other Public Board Experience CEO CFO Operations Risk Management Sustainability (1) Digital / Technology Peter R. Voser 10 ● ● ● ● ● ● ● ● CH M Yes Yes David Constable 10 ● ● ● ● ● ● CA, US M Yes Yes Frederico Fleury Curado 9 ● ● ● ● ● ● ● BR, PT M Yes Yes Lars Förberg 8 ● ● ● ● ● SE, CH M Yes Yes Johan Forssell 1 ● ● ● ● ● ● ● SE M Yes Yes Denise C. Johnson 2 ● ● ● ● ● ● US F Yes Yes Jennifer Xin ‑ Zhe Li 7 ● ● ● ● ● ● ● CN, CA F Yes Yes Geraldine Matchett 7 ● ● ● ● ● ● CH, UK, FR F Yes Yes David Meline 9 ● ● ● ● ● ● US, CH M Yes Yes Mats Rahmström 1 ● ● ● ● ● ● ● SE M Yes Yes (1) For more detailed information about the Board's sustainability-related experience, please see ABB’s Sustainability Statement 2024. Peter R. Voser has been a member and Chairman of ABB’s Board of Directors since April 2015. He was also ABB’s Chief Executive Officer from April 2019 to February 2020. He is a member of the board of directors of IBM Corporation (US). He is also a member of the board of directors of Temasek Holdings (Private) Limited (Singapore) as well as the chairman of the board of PSA International Pte Ltd (Singapore), one of its subsidiaries. In addition, he is the chairman of the board of trustees of the St. Gallen Foundation for International Studies. He was previously the chief executive officer of Royal Dutch Shell plc (The Netherlands). Mr. Voser was born in 1958 and is a Swiss citizen. David Constable has been a member of ABB’s Board of Directors since April 2015. He is the chairman of the board of directors and chief executive officer of Fluor Corporation (US). He was formerly president and chief executive officer as well as a member of the board of directors of Sasol Limited (South Africa). He joined Sasol after more than 29 years with Fluor Corporation (US). Mr. Constable was born in 1961 and is a Canadian and US citizen. Frederico Fleury Curado has been a member of ABB’s Board of Directors since April 2016. He is a member of the boards of directors of Transocean Ltd. (Switzerland) and LATAM Airlines Group S.A. (Chile). He was formerly the chief executive officer of Ultrapar S.A. and Embraer S.A. (both Brazil). Mr. Curado was born in 1961 and is a Brazilian and Portuguese citizen. 10 ABB CORPORATE GOVERNANCE REPORT 2024 Lars Förberg has been a member of ABB’s Board of Directors since April 2017. He is co ‑ founder and managing partner of Cevian Capital. Mr. Förberg was born in 1965 and is a Swedish and Swiss citizen. Johan Forssell has been a member of ABB’s Board of Directors since March 2024. He is a member of the boards of directors of Atlas Copco AB, Epiroc AB (both Sweden) and Wärtsilä Oyj (Finland). Through May 2024, he was a member of the board of directors of EQT AB (Sweden) as well as president and chief executive officer of Investor AB (Sweden). Mr. Forssell was born in 1971 and is a Swedish citizen. Denise C. Johnson has been a member of ABB’s Board of Directors since March 2023. She is a member of the boards of directors of the US National Mining Association, the National Association of Manufacturers and the US Chamber of Commerce (all US). Ms. Johnson is a group president of Caterpillar Inc. (US), responsible for Resource Industries. Before joining Caterpillar in 2011, she worked for General Motors (GM) in different managerial roles in the US and as president and managing director of GM in Brazil. Ms. Johnson was born in 1966 and is a US citizen. Jennifer Xin-Zhe Li has been a member of ABB’s Board of Directors since March 2018. She is a member of the boards of directors of SAP SE (Germany) and Full Truck Alliance Co. Ltd. (Cayman Islands/P.R.C.). Ms. Li is a founder and general partner of Changcheng Investment Partners (P.R.C.), a private investment fund. From 2008 to 2018, she served as chief financial officer of Baidu Inc. (P.R.C.) and chief executive officer of Baidu Capital (P.R.C.). Prior to that, Ms. Li spent 14 years with General Motors, holding various senior finance positions, including chief financial officer of GM China and corporate controller for GMAC North American Operations. Ms. Li was born in 1967 and is a Canadian citizen. Geraldine Matchett has been a member of ABB’s Board of Directors since March 2018. She is a member of the boards of directors of Nestlé Ltd. and Swiss Re Ltd (both Switzerland). She is the chairperson of the Greenhouse Gas Protocol (GHGP) steering committee. Ms. Matchett was formerly the co-chief executive officer and the chief financial officer of DSM-Firmenich (Switzerland) and, prior to the DSM-Firmenich merger, of DSM (The Netherlands). She was previously the chief financial officer of SGS Ltd (Switzerland). Prior to joining SGS she worked as an auditor at Deloitte Ltd (Switzerland) and KPMG LLP (UK). Ms. Matchett was born in 1972 and is a Swiss, British and French citizen. David Meline has been a member of ABB’s Board of Directors since April 2016. He is a member of the boards of directors of HP Inc. and (until January 30, 2025) of Pacific Biosciences of California, Inc. (both US). From 2011 through 2022, he held chief financial officer roles at Moderna Inc., Amgen Inc. and the 3M Company (all US). From 2008 through 2011 he was the corporate controller and chief accounting officer of the 3M Company (US). Prior to joining 3M, Mr. Meline worked for more than 20 years for the General Motors Company (US). Mr. Meline was born in 1957 and is a US and Swiss citizen. Mats Rahmström has been a member of ABB’s Board of Directors since March 2024. He is the chairman of the board of directors of Piab AB (Sweden) and a member of the boards of directors of Wärtsilä Oyj (Finland), Investor AB, Qvantum Industries AB and SMD Logistics AB (all Sweden). Through April 2024, he was president and chief executive officer of Atlas Copco AB (Sweden), a position which he had held since 2017 after many years in management roles at this company. Mr. Rahmström was born in 1965 and is a Swedish citizen. As of December 31, 2024, none of the Board members held any official functions or political posts. Further information on ABB’s Board members can be found on ABB’s website under the ABB Board of Directors link (available at https://new.abb.com/about/corporate-governance). BOARD MEETINGS AND ATTENDANCE The Board and its committees have regularly scheduled meetings throughout the year. These meetings are supplemented by additional meetings (either in person or by conference call), as necessary. Board meetings are convened by the Chairman or upon request by any other Board member or the CEO. Documentation covering the various items of the agenda for each Board meeting is sent out in advance to each Board member in order to allow each member time to study the covered matters prior to the meetings. Each Board meeting has a private session without management or others being present. Decisions made at the Board meetings are recorded in written minutes of the meetings. Some decisions are also taken by circular resolution. ABB CORPORATE GOVERNANCE REPORT 2024 11 The table below shows the number of meetings held during 2024 by the Board and its committees, their average duration, as well as the attendance of the individual Board members. The Board meetings shown include a strategic retreat attended by the members of the Board and the EC. 2024 Board and Board Committee Meetings Pre Annual General Meeting 2024 Post Annual General Meeting 2024 Board Board Meetings and attendance Mtg. Conf. Call FACC GNC CC Mtg. Conf. Call FACC GNC CC Average duration (hours) 8 1.5 2.75 1.25 1.5 8 0.75 2.75 1.5 1.25 Number of meetings 1 1 2 2 2 4 1 5 2 5 Meetings attended: Peter R. Voser 1 1 2 4 1 2 Jacob Wallenberg (1) 1 1 2 Gunnar Brock (1) 1 1 2 David Constable 1 1 2 4 1 5 Frederico Fleury Curado 1 1 2 4 1 5 Lars Förberg 1 1 2 4 1 2 Johan Forssell (2) 4 1 2 Denise C. Johnson 1 1 2 4 1 5 Jennifer Xin-Zhe Li 1 1 2 1 4 1 2 5 Geraldine Matchett 1 1 2 4 1 5 David Meline 1 1 2 4 1 5 Mats Rahmström (2) 4 1 5 (1) Did not stand for re-election at ABB’s Annual General Meeting 2024. (2) Elected at ABB’s Annual General Meeting 2024. MANDATES OF BOARD MEMBERS OUTSIDE THE ABB GROUP No member of the Board may hold more than ten additional mandates, of which no more than four may be in listed companies. Certain types of mandates, such as those in our subsidiaries, those in the same group of companies and those in non ‑ profit and charitable institutions, are not subject to those limits. Additional details can be found in Article 38 of ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate- governance). BUSINESS RELATIONSHIPS BETWEEN ABB AND ITS BOARD MEMBERS This section describes important business relationships between ABB and its Board members, or companies and organizations represented by them. Atlas Copco AB (Atlas Copco) is an important customer of ABB. ABB sells primarily motors and generators through its Motion business to Atlas Copco. Johan Forssell is a member of the board of directors of Atlas Copco. Caterpillar Inc. (Caterpillar) is an important customer of ABB. ABB sells primarily motors, generators and drives through its Motion business to Caterpillar. Denise Johnson is a group president of Caterpillar. Fluor Corporation (Fluor) is an important customer of ABB. ABB sells primarily electrical switchgears, control systems and electrical solutions through its Electrification and Process Automation businesses to Fluor. David Constable is the chairman of the board of directors and CEO of Fluor. Wärtsilä Oyj (Wärtsilä) is an important customer of ABB. ABB sells primarily motors and generators as well as integrated automation and electrical systems through its Motion and Process Automation businesses to Wärtsilä. Johan Forssell and Mats Rahmström are members of the board of directors of Wärtsilä. 12 ABB CORPORATE GOVERNANCE REPORT 2024 After reviewing the level of business with Atlas Copco, Caterpillar, Fluor and Wärtsilä, the Board has determined that ABB’s business relationships with these companies are not unusual in their nature or conditions and do not constitute material business relationships. As a result, the Board concluded that all members of the Board are independent. These determinations were made in accordance with ABB Ltd's Related Party Transaction Policy, which is contained in the ABB Ltd Board Governance Rules (available at https://new.abb.com/about/corporate- governance). INFORMATION AND CONTROL SYSTEMS OF THE BOARD VIS-À-VIS THE EXECUTIVE COMMITTEE Information from the Executive Committee In accordance with the ABB Board Governance Rules (available at https://new.abb.com/about/corporate- governance), the CEO reports regularly to the Board about ABB’s overall business and when circumstances require on any extraordinary events that may arise. This includes: • reports on financial results (including profit and loss, balance sheet and cash flows); • changes in key members of management; • information that may affect the supervisory or monitoring function of the Board (including on matters of strategy and compliance); and • significant developments in legal matters. At each Board meeting, Board members are briefed by the Chairman, CEO, CFO and other EC members on ABB’s business performance and on material developments affecting ABB. Outside of Board meetings, Board members generally channel any requests for information through the Chairman. Board members also obtain information through offsite retreats with the Executive Committee and visits to ABB sites. In addition, Board members obtain information through the Board committees in which they participate and which are also attended by relevant EC members and management representatives from human resources, finance, legal and the business. Internal Audit ABB has an Internal Audit team that provides independent objective assurance and other services to help ensure that ABB operates in accordance with applicable laws as well as internal policies and procedures. Internal Audit reports to the FACC and to the CFO. The FACC reviews and approves the internal audit plan, and material changes to the plan. Investigations of potential fraud and inappropriate business conduct are an integral part of the internal audit process. Depending on circumstances, Internal Audit may act together with ABB’s Integrity Investigations and Monitoring department, which is part of ABB’s Integrity function. Internal Audit reports on a regular basis its main observations and recommendations to the relevant members of the EC and to the FACC as appropriate. Risk Management ABB has an enterprise risk management program (ERM) in place which takes into account ABB’s size and complexity. ERM provides the EC and the Board with a comprehensive and holistic view of the risks facing the business. ERM involves managing the acceptance of risk to achieve the objectives of the business. The ERM process is typically cyclical in nature, conveying the idea of continuous refinement of the risk management approach in a dynamic business environment. Furthermore, ABB runs a mitigation process for the identified risks that is key to the success of this process. ERM assessments are both top down and bottom up. They cover strategic, financial, and operational risks, both current and long term. Key risks identified and managed in 2024 were those related to cyber security incidents, geopolitical instability, integrity behavior, intensified competition as well as legal and regulatory changes. ERM results are reported to the FACC and the entire Board. This information becomes part of the overall strategic and risk discussions by the Board to help create value for stakeholders. ABB CORPORATE GOVERNANCE REPORT 2024 13 — EXECUTIVE COMMITTEE COMPOSITION OF THE EXECUTIVE COMMITTEE (AT DECEMBER 31, 2024) Morten Wierod Chief Executive Officer CORPORATE OFFICERS BUSINESS AREA PRESIDENTS Timo Ihamuotila Giampiero Frisio Chief Financial Officer Electrification Carolina Granat Peter Terwiesch Chief Human Resources Officer Process Automation Mathias Gaertner Brandon Spencer General Counsel and Company Secretary Motion Karin Lepasoon Sami Atiya Chief Communications and Sustainability Officer Robotics & Discrete Automation EXECUTIVE COMMITTEE RESPONSIBILITIES AND ORGANIZATION The Board has delegated the executive management of ABB to the CEO. The CEO and, under his direction, the other members of the Executive Committee are responsible for ABB’s overall business and affairs and day-to-day management. The CEO reports to the Board regularly, and whenever extraordinary circumstances so require, on the course of ABB’s business and financial performance and on all organizational and personnel matters, transactions and other issues material to the Group. Each member of the Executive Committee is appointed and discharged by the Board. MEMBERS OF THE EXECUTIVE COMMITTEE (AT DECEMBER 31, 2024) Morten Wierod was appointed Chief Executive Officer effective August 2024. He was President of the Electrification business area since April 2022 and has been a member of the Executive Committee since April 2019, when he was appointed President of the Motion business area. From 2015 until April 2019, he was the Managing Director of the Drives business unit in the Robotics and Motion division. During 2011 to 2015, Mr. Wierod was the Managing Director of the Control Products business unit in the Low Voltage Products division. Between 1998 to 2011, he held various management roles with ABB. Mr. Wierod was born in 1972 and is a Norwegian citizen. Timo Ihamuotila was appointed Chief Financial Officer and member of the Executive Committee effective April 2017. He is a member of the board of directors of Kone Oyj (Finland). Through April 2024, he was a member of the board of directors of SoftwareONE Holding Ltd (Switzerland). From 2009 to 2016, Mr. Ihamuotila was chief financial officer and an executive vice president of the Nokia Corporation (Finland). From 1999 to 2009, he held various senior roles with Nokia. Mr. Ihamuotila was born in 1966 and is a Finnish citizen. 14 ABB CORPORATE GOVERNANCE REPORT 2024 Carolina Granat was appointed Chief Human Resources Officer and member of the Executive Committee effective January 2021. She joined ABB in 2020 as Head of People Development. From 2004 to 2020, Ms. Granat held various HR positions within Sandvik AB (Sweden) and in her final 7 years at the company had global responsibility for human resources in its machining solutions business area. Prior to that, she worked for 6 years at Boston Consulting Group (Sweden) as HR manager for the Nordic region. Ms. Granat was born in 1972 and is a Swedish citizen. Mathias Gaertner was appointed General Counsel and member of the Executive Committee effective November 2024. He joined ABB from Holcim Ltd (Switzerland), where he was head legal & compliance and a member of its group executive committee since 2021. Prior to that, Mr. Gaertner had worked 10 years at Honeywell Building Technologies (US), most recently as general counsel, as well as for a number of international law firms. Mr. Gaertner was born in 1973 and is a German citizen. Karin Lepasoon was appointed Chief Communications and Sustainability Officer and member of the Executive Committee effective October 2022. She joined ABB from Vattenfall AB (Sweden), where she served as head of group communications and public & regulatory affairs and member of the company’s group executive management team. Prior to that, Ms. Lepasoon also served as head of global marketing and communications at SEB, director of sustainability, communications and HR at Nordic Capital, head of strategy and chief of staff at Skanska, and held various other roles in the area of communications. Ms. Lepasoon was born in 1968 and is a Swedish citizen. Peter Terwiesch was appointed President of the Process Automation business area and member of the Executive Committee effective January 2015 (Process Automation known as Industrial Automation from 2017 until 2020). He is a member of the board of directors of Hilti AG (Liechtenstein). From 2011 to 2014, Mr. Terwiesch was Head of ABB’s Central Europe region. He was ABB’s Chief Technology Officer from 2005 to 2011. From 1994 to 2005, he held several positions with ABB. Mr. Terwiesch was born in 1966 and is a German and Swiss citizen. Giampiero Frisio was appointed President of the Electrification business area and member of the Executive Committee effective August 2024. He is a member of the board of directors of ABB E-mobility Holding Ltd (Switzerland). Mr. Frisio held a number of executive positions in ABB’s Electrification business, including President of the Smart Power division since 2021, Managing Director of the Smart Power business unit from 2019 to 2021, and Managing Director of the Protection and Connections business unit from 2015 to 2018. During 2010 to 2015, Mr. Frisio was the Managing Director of the Breakers and Switches business unit in the Low Voltage Products division. Between 2001 to 2010, he held various management roles with ABB. Mr. Frisio was born in 1969 and is an Italian citizen. Brandon Spencer was appointed President of the Motion business area and member of the Executive Committee effective August 2024. He held a number of executive positions in ABB’s Process Automation business (Process Automation known as Industrial Automation from 2017 until 2020), including President of the Energy Industries division since 2020, Managing Director of the Process Industries business unit from 2018 to 2020 and business unit manager North America from 2015 to 2018. Between 2006 and 2015, Mr. Spencer held several management positions with ABB. Prior to joining ABB, he held various roles at Siemens in the US from 2001 to 2006. Mr. Spencer was born in 1978 and is a US citizen. Sami Atiya was appointed President of the Robotics & Discrete Automation business area effective April 2019 and has been a member of the Executive Committee since June 2016. He is a member of the board of directors of SGS Ltd (Switzerland). He had previously been President of the Robotics and Motion division since January 2017. From June to December 2016 he was President of the Discrete Automation and Motion division. Prior to joining ABB, Mr. Atiya held senior roles at Siemens in Germany from 1997 to 2015, including as chief executive officer of the mobility and logistics division in the infrastructure and cities sector from 2011. Mr. Atiya was born in 1964 and is a German citizen. Further information about the members of the Executive Committee can be found on ABB’s website under the Executive Committee link (available at https://new.abb.com/about/corporate-governance). ABB CORPORATE GOVERNANCE REPORT 2024 15 MANDATES OF EC MEMBERS OUTSIDE THE ABB GROUP No member of the EC may hold more than five additional mandates, of which no more than one may be in a listed company. Certain types of mandates, such as those in our subsidiaries, those in the same group of companies and those in non ‑ profit and charitable institutions, are not subject to those limits. Additional details can be found in Article 38 of ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate- governance). BUSINESS RELATIONSHIPS BETWEEN ABB AND ITS EC MEMBERS The Company has determined that there are no important business relationships between ABB and its EC members, or companies and organizations represented by them. This determination was made in accordance with ABB Ltd's Related Party Transaction Policy, which is contained in the ABB Ltd Board Governance Rules (available at https://new.abb.com/about/corporate-governance). 16 ABB CORPORATE GOVERNANCE REPORT 2024 — SHARES SHARE CAPITAL OF ABB At December 31, 2024, ABB’s ordinary share capital (including treasury shares) as registered with the commercial register amounted to CHF 223,273,786.56, divided into 1,860,614,888 fully paid registered shares with a par value of CHF 0.12 per share. ABB Ltd’s shares are listed on the SIX Swiss Exchange and the NASDAQ OMX Stockholm Exchange. Following the delisting of its American Depositary Receipts (ADR) from the New York Stock Exchange and the conversion of its ADR program into a sponsored Level I ADR program trading on the US over-the-counter market in 2023, ABB filed on June 10, 2024, to voluntarily deregister and suspend SEC reporting obligations, which became effective 90 days after filing. At December 31, 2024, ABB Ltd had a market capitalization based on outstanding shares (total number of outstanding shares: 1,838,192,288) of approximately CHF 90 billion (USD 100 billion, SEK 1,094 billion). The only consolidated subsidiary in the ABB Group with listed shares is ABB India Limited, Bangalore, India, which is listed on the BSE Ltd. (Bombay Stock Exchange) and the National Stock Exchange of India. At December 31, 2024, ABB Ltd, Switzerland, directly or indirectly owned 75 percent of ABB India Limited, Bangalore, India, which at that time had a market capitalization of approximately INR 1,465 billion. STOCK EXCHANGE LISTINGS (AT DECEMBER 31, 2024) Stock exchange Security Ticker symbol ISIN code SIX Swiss Exchange ABB Ltd, Zurich, share ABBN CH0012221716 SIX Swiss Exchange ABB Ltd, Zurich, share buyback (second trading line) ABBNE CH0357679619 NASDAQ OMX Stockholm Exchange ABB Ltd, Zurich, share ABB CH0012221716 BSE Ltd. (Bombay Stock Exchange) ABB India Limited, Bangalore, share ABB (1) INE117A01022 National Stock Exchange of India ABB India Limited, Bangalore, share ABB INE117A01022 (1) Also called Scrip ID. SHARE REPURCHASES AND CANCELLATION Following the introduction of a capital band as approved by ABB’s shareholders at its Annual General Meeting 2023, the Board of Directors resolved to cancel 21,387,687 shares repurchased under ABB’s 2022/23 and 2023/24 share buyback programs. These shares were cancelled in June 2024, resulting in a reduced total number of issued ABB Ltd shares of 1,860,614,888. In April 2024, ABB launched a follow-up share buyback program of up to USD 1 billion. This new program is consistent with ABB’s capital allocation principles and its capital structure optimization program targeting to maintain a strong investment grade rating. Under that share buyback program, ABB repurchased a total of 14,957,384 shares as per December 31, 2024. ABB intends to use the capital band (see “Capital band” below) again for cancellation of shares repurchased under the share buyback program 2024. Further information on ABB’s share buyback programs can be found at https://global.abb/group/en/investors/investor-and-shareholder-resources/share-buybacks. In addition, ABB repurchased a total of 5,112,500 shares as per December 31, 2024, primarily for use in connection with employee share programs. Further information can be found at https://www.abb.com/investorrelations. ABB CORPORATE GOVERNANCE REPORT 2024 17 CHANGES TO THE ORDINARY SHARE CAPITAL Except for the share cancellations described above and in ABB’s Corporate Governance Report 2023 and 2022, there were no other changes to ABB’s ordinary share capital during 2024, 2023 and 2022. CONVERTIBLE BONDS AND OPTIONS ABB does not have any bonds outstanding that are convertible into ABB shares. For information about options on shares issued by ABB, please refer to “Note 19 – Stockholders' equity” to ABB’s Consolidated Financial Statements. CONTINGENT SHARE CAPITAL At December 31, 2024, ABB’s share capital may be increased by an amount not to exceed CHF 24,000,000 through the issuance of up to 200,000,000 fully paid registered shares with a par value of CHF 0.12 per share through the exercise of conversion rights and/or warrants granted in connection with the issuance on national or international capital markets of newly or already issued bonds or other financial market instruments. If this contingent share capital were fully issued, this would increase the existing share capital by approximately 10.7 percent. The contingent share capital has not changed during the last three years. At December 31, 2024, ABB’s share capital may be increased by an amount not to exceed CHF 1,200,000 through the issuance of up to 10,000,000 fully paid registered shares with a par value of CHF 0.12 per share through the exercise of warrant rights granted to its shareholders. If this contingent share capital were fully issued, this would increase the existing share capital by approximately 0.5 percent. This contingent share capital has not changed during the last three years. The Board may grant warrant rights not taken up by shareholders for other purposes in the interest of ABB. The pre ‑ emptive rights of the shareholders are excluded in connection with the issuance of convertible or warrant-bearing bonds or other financial market instruments or the grant of warrant rights. The then current owners of conversion rights and/or warrants will be entitled to subscribe for new shares. The conditions of the conversion rights and/or warrants will be determined by the Board. The acquisition of shares through the exercise of warrants and each subsequent transfer of the shares will be subject to the restrictions of ABB’s Articles of Incorporation (see “Limitations on transferability of shares and nominee registration” in the Shareholders section below) (available at https://new.abb.com/about/corporate- governance). In connection with the issuance of convertible or warrant-bearing bonds or other financial market instruments, the Board is authorized to restrict or deny the advance subscription rights of shareholders if such bonds or other financial market instruments are for the purpose of financing or refinancing the acquisition of an enterprise, parts of an enterprise, participations or new investments or an issuance on national or international capital markets. If the Board denies advance subscription rights, the convertible or warrant ‑ bearing bonds or other financial market instruments will be issued at the relevant market conditions and the new shares will be issued pursuant to the relevant market conditions taking into account the share price and/or other comparable instruments having a market price. Conversion rights may be exercised during a maximum ten ‑ year period, and warrants may be exercised during a maximum seven ‑ year period, in each case from the date of the respective issuance. The advance subscription rights of the shareholders may be granted indirectly. At December 31, 2024, ABB’s share capital may be increased by an amount not to exceed CHF 11,284,656 through the issuance of up to 94,038,800 fully paid shares with a par value of CHF 0.12 per share to employees. If this contingent share capital were fully issued, this would increase the existing share capital by approximately 5.1 percent. This contingent share capital has not changed during the last three years. The pre ‑ emptive and advance subscription rights of ABB’s shareholders are excluded. The shares or rights to subscribe for shares will be issued to employees pursuant to one or more regulations to be issued by the Board, taking into account performance, functions, level of responsibility and profitability criteria. ABB may issue shares or subscription rights to employees at a price lower than that quoted on a stock exchange. The acquisition of shares within the context of employee share ownership and each subsequent transfer of the shares will be subject to the restrictions of ABB’s Articles of Incorporation (see “Limitations on transferability of shares and nominee registration” in the Shareholders section below). 18 ABB CORPORATE GOVERNANCE REPORT 2024 CAPITAL BAND At December 31, 2024, ABB had a capital band ranging from CHF 212,192,469 (lower limit) to CHF 259,346,349 (upper limit), i.e., from 90 percent to 110 percent of the share capital entered in the commercial register at the time when the capital band was introduced in 2023. Within this capital band, the Board of Directors is authorized to increase or reduce the share capital once or several times until March 23, 2028, or until an earlier expiry of the capital band. In the event of a capital increase within the capital band, the Board is authorized, to the extent necessary, to determine the date of issue of new shares, the issue price, the type of contribution, the conditions for the exercise of pre ‑ emptive rights and the beginning date for dividend entitlement. In this regard, the Board may issue new shares by means of a firm underwriting through a financial institution, a syndicate of financial institutions or another third party and a subsequent offer of these shares to the existing shareholders or third parties (if the pre-emptive rights of the existing shareholders have been withdrawn or have not been duly exercised). The Board is entitled to permit, to restrict or to exclude the trade with pre-emptive rights. It may permit the expiration of pre ‑ emptive rights that have not been duly exercised, or it may place such rights or shares as to which pre ‑ emptive rights have been granted, but not duly exercised, at market conditions or may use them otherwise in the interest of the Company. The Board is further authorized to restrict or deny the pre ‑ emptive rights of shareholders and allocate such rights to third parties if the shares are to be used (1) for the acquisition of an enterprise, parts of an enterprise, or participations, or for new investments, or, in case of a share placement, for the financing or refinancing of such transactions; or (2) for the purpose of broadening the shareholder constituency in connection with a listing of shares on domestic or foreign stock exchanges. The subscription and the acquisition of the new shares, as well as each subsequent transfer of the shares, will be subject to the restrictions of ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate-governance). If ABB’s share capital increases as a result of an increase from ABB’s contingent capital, the upper and lower limits of the capital band shall increase in an amount corresponding to such increase in the share capital. In the event of a capital reduction within the capital band, the Board of Directors is authorized, to the extent necessary, to determine the use of the reduction amount. ABB used the capital band for cancellation of shares repurchased under its recent share buyback programs and intends to use it again for cancellation of shares repurchased under the share buyback program 2024 (see “Share repurchases and cancellation” above). EXCLUSION OF PRE-EMPTIVE OR ADVANCE SUBSCRIPTION RIGHTS Until March 23, 2028, or an earlier expiry of the capital band, the total number of newly issued shares which may be issued with the restriction or withdrawal of (advance) subscription rights from (1) ABB’s contingent share capital and from (2) ABB’s capital band in any event shall not exceed 196,474,500 shares, i.e., 10 percent of the share capital entered in the commercial register at the time when the capital band was introduced in 2023. ABB CORPORATE GOVERNANCE REPORT 2024 19 — SHAREHOLDERS SHAREHOLDER STRUCTURE At December 31, 2024, the total number of shareholders directly registered with ABB Ltd was approximately 86,000, and another 653,000 shareholders held shares indirectly through nominees. In total, as of that date, ABB had approximately 739,000 shareholders. SIGNIFICANT SHAREHOLDERS Under the Swiss Financial Market Infrastructure Act, shareholders and groups of shareholders acting in concert who directly or indirectly acquire or sell shares of a listed Swiss corporation or rights based thereon and thereby reach, exceed or fall below the thresholds of 3 percent, 5 percent, 10 percent, 15 percent, 20 percent, 25 percent, 33 1 / 3 percent, 50 percent or 66 2 / 3 percent of the voting rights of the corporation must notify the corporation and the SIX Swiss Exchange of such holdings. Based on the disclosure notifications made to ABB and the SIX Swiss Exchange, the following shareholders hold or control voting rights of 3 percent or more of ABB Ltd’s issued shares. Except where indicated otherwise, the shareholdings described below are based on the notices provided to ABB and the SIX Swiss Exchange and do not reflect any subsequent changes in shareholdings and share capital and votes. Investor AB, Sweden, disclosed to ABB and the SIX Swiss Exchange that as per November 9, 2015, it held 232,165,142 ABB Ltd shares, corresponding to 10.03 percent of the voting rights in ABB Ltd (refer to https://www.ser-ag.com/en/resources/notifications-market-participants/significant- shareholders.html#/shareholder-details/TBFBH00013) . In its latest quarterly financial report, Investor AB, Sweden, disclosed that as per December 31, 2024, it held 265,385,142 ABB Ltd shares, corresponding to 14.3 percent of the voting rights in ABB Ltd. UBS Fund Management (Switzerland) AG, Switzerland, disclosed to ABB and the SIX Swiss Exchange that as per September 19, 2024, it held 93,047,279 ABB Ltd shares, corresponding to 5.001 percent of the voting rights in ABB Ltd (refer to https://www.ser-ag.com/en/resources/notifications-market-participants/significant- shareholders.html#/shareholder-details/ZA03-000000000P124). BlackRock, Inc., U.S.A., disclosed to ABB and the SIX Swiss Exchange that as per June 1, 2023, it held 82,027,197 ABB Ltd shares, corresponding to 4.17 percent of the voting rights in ABB Ltd (refer to https://www.ser- ag.com/en/resources/notifications-market-participants/significant-shareholders.html#/shareholder- details/TAN62000B0). At December 31, 2024, to the best of ABB’s knowledge, no other shareholder held 3 percent or more of ABB’s total share capital and voting rights as registered in the commercial register on that date. ABB Ltd has no cross shareholdings in excess of 5 percent of capital or voting rights with any other company. Announcements related to disclosure notifications made by shareholders during 2024 can be found via the search facility on the platform of the Disclosure Office of the SIX Swiss Exchange: https://www.ser- ag.com/en/resources/notifications-market-participants/significant-shareholders.html#/. Under ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate-governance), each registered share represents one vote. Significant shareholders do not have different voting rights. To our knowledge, we are not directly or indirectly owned or controlled by any government or by any other corporation or person. SHAREHOLDERS’ RIGHTS Shareholders have the right to receive dividends, to vote and to execute such other rights as granted under Swiss law and the Articles of Incorporation (available at https://new.abb.com/about/corporate-governance). 20 ABB CORPORATE GOVERNANCE REPORT 2024 Right to vote ABB has one class of shares and each registered share carries one vote at the general meeting of shareholders. Voting rights may be exercised only after a shareholder has been registered in the share register of ABB as a shareholder with the right to vote, or with Euroclear Sweden AB (Euroclear), which maintains a subregister of the share register of ABB. A shareholder may be represented at the general meeting of shareholders by the independent proxy elected by the shareholders (“Unabhängiger Stimmrechtsvertreter”), its legal representative or, by means of a written proxy, any other proxy who need not be a shareholder. If the Company does not have an independent proxy, the Board of Directors shall appoint the independent proxy for the next general meeting of shareholders. All shares held by one shareholder may be represented by one representative only. For practical reasons shareholders must be registered in the share register no later than 6 business days before the general meeting of shareholders in order to be entitled to vote. Except for the cases described under “Limitations on transferability of shares and nominee registration” below, there are no voting rights restrictions limiting ABB’s shareholders’ rights. Powers of General Meeting of Shareholders The ordinary general meeting of shareholders must be held each year within 6 months after the close of the fiscal year of the Company; the business report, the compensation report, the auditors’ reports, and the report on non- financial matters shall be made available to the shareholders by no later than 20 days prior to the meeting. The following powers shall be vested exclusively in the general meeting of shareholders: • Adoption and amendment of the Articles of Incorporation; • Election of the members of the Board of Directors, the Chairman of the Board of Directors, the members of the Compensation Committee, the auditors and the independent proxy; • Approval of the annual management report and consolidated financial statements; • Approval of the annual financial statements and decision on the allocation of profits shown on the balance sheet, in particular with regard to dividends; • The determination of interim dividends and the approval of the interim financial statements required for this purpose; • The resolution on the repayment of the statutory capital reserve; • Approval of the maximum compensation of the Board of Directors and of the Executive Committee pursuant to Article 34 of the Articles of Incorporation; • Granting discharge to the members of the Board of Directors and the persons entrusted with management; • The delisting of the Company’s equity securities; • The approval of the report on non-financial matters; • Passing resolutions as to all matters reserved to the authority of the general meeting of shareholders by law or under the Articles of Incorporation or that are submitted to the general meeting of shareholders by the Board of Directors, subject to Article 716a of the Swiss Code of Obligations. Resolutions and elections at General Meeting of Shareholders Unless otherwise required by law or the Company’s Articles of Incorporation, the general meeting of shareholders shall pass resolutions and decide elections upon a majority of the votes represented. One or more shareholders who, alone or together, hold at least 0.02 percent of the share capital or votes may demand that an item be included on the agenda or that a proposal relating to an agenda item be included in the notice convening the general meeting of shareholders. Such a request must be received by the Company in writing at least 40 days prior to the meeting and shall specify the agenda items and the proposal or proposals together with a brief statement of the reasons. ABB’s Articles of Incorporation do not contain provisions on the convocation of the general meeting of shareholders that differ from the applicable legal provisions. ABB CORPORATE GOVERNANCE REPORT 2024 21 Shareholders’ dividend rights The unconsolidated statutory financial statements of ABB Ltd are prepared in accordance with Swiss law. Based on these financial statements, dividends may be paid only if ABB Ltd has sufficient distributable profits from previous years or sufficient free reserves to allow the distribution of a dividend. Swiss law requires that ABB Ltd retain at least 5 percent of its annual net profits as legal reserves until these reserves amount to at least 20 percent of ABB Ltd’s share capital. Any net profits remaining in excess of those reserves are at the disposal of the general meeting of shareholders. Under Swiss law, ABB Ltd may only pay out a dividend if it has been proposed by a shareholder or the Board of Directors and approved at a general meeting of shareholders, and the auditors confirm that the dividend conforms to statutory law and ABB’s Articles of Incorporation. In practice, the general meeting of shareholders usually approves dividends as proposed by the Board of Directors. Dividends are usually due and payable no earlier than 2 trading days after the shareholders’ resolution and the ex ‑ date for dividends is normally 2 trading days after the shareholders’ resolution approving the dividend. Dividends are paid out to the holders that are registered on the record date. Euroclear administers the payment of those shares registered with it. Under Swiss law, dividends not collected within 5 years after the due date accrue to ABB Ltd and are allocated to its profit reserves. As ABB Ltd pays cash dividends, if any, in Swiss francs (subject to the exception for certain shareholders in Sweden described below), exchange rate fluctuations will affect the US dollar amounts received by holders of ADSs upon conversion of those cash dividends from Swiss francs. For shareholders who are residents of Sweden, ABB has established a dividend access facility (for up to 600,004,716 shares). With respect to any annual dividend payment for which this facility is made available, shareholders who register with Euroclear may elect to receive the dividend from ABB Norden Holding AB in Swedish krona (in an amount equivalent to the dividend paid in Swiss francs) without deduction of Swiss withholding tax. For further information on the dividend access facility, see ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate-governance). Limitations on transferability of shares and nominee registration ABB may decline a registration with voting rights if a shareholder does not declare that it has acquired the shares in its own name and for its own account, that there is no agreement on the redemption of the relevant shares and that it bears the economic risk associated with the shares. If the shareholder refuses to make such declarations, it will be registered as a shareholder without voting rights. A person failing to expressly declare in its registration application that it holds the shares for its own account (a nominee) will be entered in the share register with voting rights, provided that such nominee has entered into an agreement with ABB concerning its status, and further provided that the nominee is subject to recognized bank or financial market supervision. In special cases, the Board may grant exemptions. There were no exemptions granted in 2024. The limitation on the transferability of shares may be removed by an amendment of ABB’s Articles of Incorporation by a shareholders’ resolution requiring two-thirds of the votes represented at the general meeting of shareholders. No restriction on trading of shares No restrictions are imposed on the transferability of ABB shares. The registration of shareholders in the ABB share register, Euroclear and the ADS register kept by Deutsche Bank does not affect transferability of ABB shares or ADSs. Registered ABB shareholders or ADR holders may therefore purchase or sell their ABB shares or ADRs at any time, including before a general meeting of shareholders regardless of the record date. The record date serves only to determine the right to vote at a general meeting of shareholders. Duty to make a public tender offer ABB’s Articles of Incorporation do not contain any provisions raising the threshold (opting up) or waiving the duty (opting out) to make a public tender offer pursuant to Article 135 of the Swiss Act on Financial Market Infrastructures and Market Conduct in Securities and Derivatives Trading. 22 ABB CORPORATE GOVERNANCE REPORT 2024 — INDEPENDENT EXTERNAL AUDITORS DURATION OF THE MANDATE AND TERM OF OFFICE OF THE AUDITORS On March 21, 2024, shareholders at the Annual General Meeting of ABB Ltd approved the appointment of KPMG AG, Zurich, Switzerland (KPMG), to be the auditors of the Company for the 2024 financial year. KPMG are the auditors of ABB’s statutory and consolidated financial statements. KPMG assumed the sole auditing mandate of the consolidated financial statements of the ABB Group beginning in the year ended December 31, 2018. The auditor in charge and responsible for the mandate, Achim Wolper, began serving in this capacity in respect of the financial year ended December 31, 2023. Pursuant to ABB’s Articles of Incorporation (available at https://new.abb.com/about/corporate-governance), the term of office of ABB’s auditors is one year. INFORMATION TO THE BOARD AND THE FINANCE, AUDIT AND COMPLIANCE COMMITTEE Supervisory and control instruments vis-à-vis the auditors ABB’s auditors, KPMG, attend each meeting of the FACC and each meeting includes a private session between the auditors and the FACC without management being present. In 2024, the FACC had 7 meetings (either in person or via telephone call). On at least an annual basis, the FACC reviews and discusses with the external auditors all significant relationships that the auditors have with the Company that could impair their independence. The FACC reviews the auditor engagement letter and the audit plan including discussion of scope, staffing, locations and general audit approach. The FACC also reviews and evaluates the auditors’ judgment on the quality and appropriateness of the Company’s accounting principles as applied in the financial reporting. In addition, ABB has a process for the review and pre-approval of non-audit services to be performed by KPMG. At least annually, the FACC obtains and reviews a report by the auditors that includes discussion on: • the Company’s internal control system; • material issues, if any, raised by the most recent internal quality control review; • critical accounting policies and practices of the Company; • all alternative accounting treatments of financial information that were discussed between the auditors and management as well as the related ramifications; and • material communications between the auditors and management such as any management letter or schedule of audit differences. Taking into account the opinions of management, the FACC evaluates the qualifications, independence and performance of the auditors. The FACC reports the material elements of its supervision of the auditors to the Board and on an annual basis recommends to the Board the auditors to be proposed for election at the general meeting of shareholders. ABB CORPORATE GOVERNANCE REPORT 2024 23 AUDIT AND ADDITIONAL FEES PAID TO THE AUDITORS The audit fees charged by KPMG for the legally prescribed audit amounted to USD 26.8 million in 2024. Audit services are defined as the standard audit work performed each fiscal year necessary to allow the auditors to issue an opinion on the consolidated financial statements of ABB and to issue an opinion on the local statutory financial statements. This classification may also include services that can be provided only by the auditors, such as pre-issuance reviews of quarterly financial results and comfort letters delivered to underwriters in connection with debt and equity offerings. In addition, KPMG charged USD 4.3 million for non-audit services during 2024. Non-audit services include primarily assurance over sustainability disclosures, agreed-upon procedure reports, accounting consultations, audits of pension and benefit plans, accounting advisory services and other attest services related to financial reporting that are not required by statute or regulation, income tax and indirect tax compliance services as well as tax advisory services. In total, KPMG charged ABB fees for audit and non-audit services rendered in 2024 in the amount of USD 31.1 million. 24 ABB CORPORATE GOVERNANCE REPORT 2024 — OTHER GOVERNANCE INFORMATION ABB GROUP ORGANIZATIONAL STRUCTURE ABB Ltd, Switzerland, is the ultimate parent company of the ABB Group. It is the sole shareholder of ABB Asea Brown Boveri Ltd, which directly or indirectly owns the other companies in the ABB Group. The table in the appendix to this Corporate Governance Report sets forth, as of December 31, 2024, the name, place of incorporation, ownership interest and share capital of the significant direct and indirect subsidiaries of ABB Ltd. ABB’s operational group structure is described in ABB’s Financial Report 2024. MANAGEMENT CONTRACTS There are no management contracts between ABB and companies or natural persons not belonging to the ABB Group. CHANGE OF CONTROL CLAUSES Board members, Executive Committee members, and other members of senior management do not receive any special benefits in the event of a change of control. From 2021, the rules for the Long-Term Incentive Plan (LTIP) have been amended to no longer provide for accelerated vesting upon a change of control. EMPLOYEE PARTICIPATION PROGRAMS In order to align its employees’ interests with the business goals and financial results of the Company, ABB operates a number of incentive plans, linked to ABB’s shares, such as the Employee Share Acquisition Plan and the LTIP. For a more detailed description of these incentive plans, please refer to “Note 18 – Share-based payment arrangements” to ABB’s Consolidated Financial Statements. GENERAL BLACKOUT PERIODS FOR TRADING ABB SECURITIES During the 30 days prior to the day of publication of the ABB Group’s quarterly financial results, as well as on such day, the members of the Board of Directors and the Executive Committee as well as certain employees of ABB, as specified in ABB’s internal policies, are prohibited from trading in ABB Ltd securities and any related financial instruments. No exceptions were granted to this rule in 2024. ABB CORPORATE GOVERNANCE REPORT 2024 25 — INFORMATION POLICY ABB, as a publicly traded company, is committed to communicating in a timely and consistent way to shareholders, potential investors, financial analysts, customers, suppliers, the media and other interested parties. ABB is required to disseminate material information pertaining to its businesses in a manner that complies with its obligations under the rules of the stock exchanges where its shares are listed and traded. ABB publishes an annual reporting suite that provides audited financial statements and information about ABB including our business results, strategy, products and services, corporate governance and executive compensation. In addition, ABB publishes its results on a quarterly basis as press releases, distributed pursuant to the rules and regulations of the stock exchanges on which its shares are listed and traded. An archive containing annual reports, quarterly results releases and related presentations can be found in the “Reporting” section at https://www.abb.com/investorrelations. The quarterly results press releases contain unaudited financial information prepared in accordance with or reconciled to U.S. GAAP. To subscribe to important press releases, please click on “Contact” and choose “Subscribe” at https://www.abb.com/investorrelations. Ad-hoc notices can also be found in the press releases section at https://www.abb.com/news. ABB’s official means of communication is the Swiss Official Gazette of Commerce (https://www.shab.ch). An invitation to the Company’s general meeting of shareholders is sent to registered shareholders by mail. Inquiries may also be made to ABB Investor Relations: Affolternstrasse 44 CH-8050 Zurich, Switzerland Telephone: +41 43 317 71 11 E-mail: investor.relations@ch.abb.com www.abb.com FURTHER INFORMATION ON CORPORATE GOVERNANCE The list below contains references to additional information concerning the corporate governance of ABB (available at https://new.abb.com/about/corporate-governance). • Articles of Incorporation • ABB Ltd Board Governance Rules, which include: o Governance Rules of the Finance, Audit and Compliance Committee o Governance Rules of the Governance and Nomination Committee o Governance Rules of the Compensation Committee o Related Party Transaction Policy • ABB Code of Conduct • Summary of differences of shareholder rights under Swedish and Swiss law applicable to ABB • CVs of the Board members • CVs of the Executive Committee members ABB’s corporate calendar can be found at https://new.abb.com/investorrelations/calendar-events-and- publications/financial-calendar. 26 ABB CORPORATE GOVERNANCE REPORT 2024 APPENDIX - ABB LTD’S SIGNIFICANT SUBSIDIARIES Name/Location Country Group Interest % Share capital in thousands Currency ABB S.A.U., Buenos Aires Argentina 100.00 25,659,498 ARS ABB Australia Pty. Limited, Moorebank Australia 100.00 71,218 AUD ABB Group Investment Management Pty. Ltd., Moorebank Australia 100.00 403,318 AUD ABB AG, Wiener Neudorf Austria 100.00 15,000 EUR B&R Holding GmbH, Eggelsberg Austria 100.00 35 EUR B&R Industrial Automation GmbH, Eggelsberg Austria 100.00 1,240 EUR ABB N.V., Zaventem Belgium 100.00 4,000 EUR ABB AUTOMAÇÃO LTDA., Sorocaba Brazil 100.00 191,039 BRL ABB ELETRIFICAÇÃO LTDA., Sorocaba Brazil 100.00 268,759 BRL ABB Bulgaria EOOD, Sofia Bulgaria 100.00 65,110 BGN ABB Electrification Canada Inc., Saint-Laurent Canada 100.00 — (1) CAD ABB Inc., Saint-Laurent Canada 100.00 — (1) CAD ABB S.A., Santiago Chile 100.00 5,484,348 CLP ABB (China) Investment Limited, Beijing China 100.00 95,000 USD ABB (China) Ltd., Beijing China 100.00 140,000 USD ABB Beijing Drive Systems Co. Ltd., Beijing China 90.00 5,000 USD ABB Beijing Switchgear Limited, Beijing China 60.00 16,500 USD ABB Electrical Machines Ltd., Shanghai China 100.00 14,400 USD ABB Engineering (Shanghai) Ltd., Shanghai China 100.00 40,000 USD ABB LV Installation Materials Co. Ltd. Beijing, Beijing China 85.70 17,100 USD ABB Shanghai Free Trade Zone Industrial Co., Ltd., Shanghai China 100.00 6,500 CNY ABB Shanghai Motors Co. Ltd., Shanghai China 75.00 11,217 USD ABB Xiamen Low Voltage Equipment Co. Ltd., Xiamen China 100.00 15,800 USD ABB Xiamen Switchgear Co. Ltd., Xiamen China 66.52 29,500 USD ABB Xinhui Low Voltage Switchgear Co. Ltd., Xinhui China 90.00 6,200 USD ABB s.r.o., Prague Czech Republic 100.00 400,000 CZK ABB A/S, Middlefart Denmark 100.00 100,000 DKK ABB for Electrical Industries (ABB ARAB) S.A.E., Cairo Egypt 100.00 353,479 EGP Asea Brown Boveri S.A.E., Cairo Egypt 100.00 166,000 USD ABB AS, Jüri Estonia 100.00 1,663 EUR ABB Oy, Helsinki Finland 100.00 10,003 EUR ABB France, Cergy Pontoise France 99.84 25,778 EUR ABB SAS, Cergy Pontoise France 100.00 45,921 EUR ABB AG, Mannheim Germany 100.00 167,500 EUR ABB Beteiligungs- und Verwaltungsgesellschaft mbH, Mannheim Germany 100.00 61,355 EUR ABB Stotz-Kontakt GmbH, Heidelberg Germany 100.00 7,500 EUR ABB CORPORATE GOVERNANCE REPORT 2024 27 Name/Location Country Group Interest % Share capital in thousands Currency ABB Striebel & John GmbH, Sasbach Germany 100.00 1,050 EUR B + R Industrie-Elektronik GmbH, Friedberg Germany 100.00 358 EUR Busch-Jaeger Elektro GmbH, Lüdenscheid Germany 100.00 1,535 EUR ABB Business Services Private Limited, Bangalore India 100.00 5,200,100 INR ABB Global Industries and Services Private Limited, Bangalore India 100.00 366,923 INR ABB India Limited, Bangalore India 75.00 423,817 INR ABB Limited, Dublin Ireland 100.00 635 EUR ABB E-mobility S.p.A., Milan Italy 74.34 20,000 EUR ABB S.p.A., Milan Italy 100.00 110,000 EUR ABB K.K., Tokyo Japan 100.00 1,000,000 JPY ABB Ltd., Seoul Korea, Republic of 100.00 16,950,000 KRW ABB Electrical Control Systems S. de R.L. de C.V., Monterrey Mexico 100.00 712,463 MXN ABB Mexico S.A. de C.V., San Luis Potosi Mexico 100.00 1,135,752 MXN Asea Brown Boveri S.A. de C.V., San Luis Potosi Mexico 100.00 667,686 MXN ABB B.V., Rotterdam Netherlands 100.00 9,200 EUR ABB E-mobility B.V., Delft Netherlands 74.34 1 EUR ABB Finance B.V., Rotterdam Netherlands 100.00 20 EUR ABB Holdings B.V., Rotterdam Netherlands 100.00 363 EUR ABB AS, Fornebu Norway 100.00 134,550 NOK ABB Electrification Norway AS, Skien Norway 100.00 60,450 NOK ABB Holding AS, Fornebu Norway 100.00 240,000 NOK ABB Business Services Sp. z o.o., Warsaw Poland 99.94 24 PLN ABB Sp. z o.o., Warsaw Poland 99.94 245,461 PLN Industrial C&S of P.R. LLC, Arecibo Puerto Rico 100.00 — (1) USD ABB Electrical Industries Co. Ltd., Riyadh Saudi Arabia 65.00 100,000 SAR ABB Pte. Ltd., Singapore Singapore 100.00 32,797 SGD ABB Holdings (Pty) Ltd., Modderfontein South Africa 100.00 217,758 ZAR ABB Investments (Pty) Ltd., Modderfontein South Africa 51.00 185,978 ZAR ABB South Africa (Pty) Ltd., Modderfontein South Africa 74.91 3,835,544 ZAR Asea Brown Boveri S.A., Madrid Spain 100.00 33,318 EUR ABB AB, Västerås Sweden 100.00 200,000 SEK ABB Electrification Sweden AB, Västerås Sweden 100.00 10,000 SEK ABB Norden Holding AB, Västerås Sweden 100.00 2,344,783 SEK ABB Asea Brown Boveri Ltd, Zurich Switzerland 100.00 2,767,880 CHF ABB Capital AG, Zurich Switzerland 100.00 100 CHF ABB E-mobility Holding Ltd, Zurich Switzerland 74.34 1,138 CHF ABB Schweiz AG, Baden Switzerland 100.00 55,000 CHF ABB Ltd., Taipei Taiwan (Chinese Taipei) 100.00 195,000 TWD ABB Elektrik Sanayi A.S., Istanbul Türkiye 99.99 165,000 TRY ABB Industries (L.L.C.), Dubai United Arab Emirates 100.00 5,000 AED ABB Industries FZE, Dubai United Arab Emirates 100.00 3,000 AED 28 ABB CORPORATE GOVERNANCE REPORT 2024 Name/Location Country Group Interest % Share capital in thousands Currency ABB Holdings Limited, Warrington United Kingdom 100.00 226,014 GBP ABB Limited, Warrington United Kingdom 100.00 120,000 GBP ABB E-mobility Inc., Wilmington, DE United States 74.34 — USD ABB Finance (USA) Inc., Wilmington, DE United States 100.00 1 USD ABB Holdings Inc., Cary, NC United States 100.00 2 USD ABB Inc., Cary, NC United States 100.00 1 USD ABB Installation Products Inc., Memphis, TN United States 100.00 1 USD ABB Motors and Mechanical Inc., Fort Smith, AR United States 100.00 — (1) USD ABB Treasury Center (USA), Inc., Wilmington, DE United States 100.00 1 USD Edison Holding Corporation, Wilmington, DE United States 100.00 — (1) USD Industrial Connections & Solutions LLC, Cary, NC United States 100.00 — (1) USD (1) Shares without par value. ABB CORPORATE GOVERNANCE REPORT 2024 29 Caution concerning forward-looking statements The Corporate Governance Report 2024 includes forward-looking statements and information that are based largely on current expectations, 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,” “continue,” “target,” “anticipate,” “intend,” “expect,” “plan” and similar words and the express or implied discussion of strategy, plans or intentions are intended to identify forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions, including, among other things, the following: (i) business risks related to the global volatile 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 competition and changes in economic and market conditions in the product markets and geographic areas in which we operate; (v) effects of, and changes in, laws, regulations, governmental 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-looking 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 forward-looking statements. 04 Letter from the Chairman of the Compensation Committee 06 At a glance 11 Compensation governance 13 Sustainability-related considerations in ABB’s compensation 15 Board compensation policy 16 Implementation of Board compensation policy 18 Executive Committee compensation policy 25 Implementation of EC compensation policy 36 Changes applicable to EC members 37 Votes on compensation at the Annual General Meeting 2024 39 Compensation tables and share ownership tables 49 Report of the statutory auditor 4 ABB COMPENSATION REPORT 2024 — Letter from the Chairman of the Compensation Committee Dear Shareholders, On behalf of the Board of Directors (Board) and the Compensation Committee, I am pleased to present the ABB Compensation Report for 2024 (Report). Our focus at the Compensation Committee is to ensure that the compensation structure at ABB drives value creation for our shareholders, represents a motivating package for our executives, and ensures alignment with market best-practices and with ABB’s Sustainability Agenda. As we continuously work to perfect our compensation reports, the section “At a glance” contains the key information of the Board and the Executive Committee (EC) compensation. These can also be found in ABB’s Integrated Report 2024 under the “Performance-based compensation” chapter. SUMMARY OF PLANNED CHANGES IN POLICIES AND DISCLOSURES In the spirit of continuous improvement and considering stakeholder feedback, we plan to make a couple of enhancements to our Annual Incentive Plan (AIP), applicable from 2025. Currently, the total weighting associated with Group and business area financial measures represents 80 percent of EC members’ target AIP award, with the remaining 20 percent attributed to the individual measure, which contains a combination of sustainability, operational and strategic goals. From 2025, we will increase the weighting of the financial measures from 80 percent to 90 percent and replace the individual measure with two mandatory sustainability goals, with a combined weighting of 10 percent. We believe the increased focus on the financial business measures will help reinforce our continued drive to achieve our ambitious financial targets. Furthermore, we think that having two clearly measurable sustainability goals in the AIP will strengthen and support ABB’s commitment to sustainability and complement the sustainability measure in our Long-Term Incentive Plan (LTIP), which has a material weighting of 20 percent of the target award. Details related to the sustainability target for the 2025 LTIP are disclosed in this Report. 2024 RESULTS AND COMPENSATION POLICY OUTCOMES 2024 was a year of strong operational and financial performance. Overall, most key financial, sustainability and operational targets were met or excelled. ABB (the Company) delivered new highs for operational EBITA margin and revenues in 2024. The Company also progressed on orders and continued to make significant progress in reducing its environmental footprint and contributing to a more sustainable environment. For more information on ABB’s 2024 sustainability achievements please refer to ABB’s Integrated Report 2024. Board of Directors: the total Board compensation for the 2024–2025 term (CHF 4.25 million) is within the maximum amount (CHF 4.4 million) approved at the Annual General Meeting (AGM) 2024. There has been no change to the individual Board member fees since 2015. Executive Committee: No EC members in place at the time of ABB’s annual salary review received a salary adjustment in March 2024. The average award for EC members under the AIP for 2024 in their year- end roles was 119 percent (out of a maximum of 150 percent), compared to 143.3 percent in 2023. The achievement level of the 2021 LTIP, which vested in 2024, was 200.0 percent (out of a maximum of 200 percent), driven by strong evolution of ABB’s Earnings Per Share (EPS) during the period and ABB’s vigorous relative Total Shareholder Return (TSR). ABB COMPENSATION REPORT 2024 5 The total EC compensation was CHF 44.5 million in 2024, driven by the strong performance-related variable pay awards and the appointment of new members of the Executive Committee during the 2024 financial year, including the provision of a replacement share grant for an external hire, as summarized in Exhibit 22, and presented in detail in Exhibit 42. This amount was slightly higher than the CHF 43.9 million approved at the Annual General Meeting 2023 for the financial year 2024, due to the impact of the appointment of new members of the Executive Committee during 2024. To cover this additional compensation, the Company used the supplementary amount provided for this purpose, in accordance with Art. 35 of the Articles of Incorporation (equivalent to 30 percent of the amount approved the at the AGM 2023), whereby the compensation granted was significantly below the maximum amount of CHF 57.1 million. GOVERNANCE At the AGM on March 27, 2025, you will be asked to vote on the maximum aggregate compensation for the Board for its 2025–2026 term and on the maximum aggregate compensation for the EC in 2026. The former is again unchanged compared to the prior year, while the latter shows a decrease from the level requested for the prior year, primarily influenced by the change in composition of the EC. This Report will also be submitted for a non-binding, consultative vote by shareholders. We have pursued an open and regular dialogue with our stakeholders, as we continue to improve our compensation system. On behalf of the Compensation Committee, I thank you for your continued trust in ABB and for your consistently supportive feedback. Frederico Fleury Curado Chairman of the Compensation Committee Zurich, February 26, 2025 6 ABB COMPENSATION REPORT 2024 — AT A GLANCE ─ BOARD COMPENSATION Compensation for the 2024–2025 term of office The total Board compensation for the 2024–2025 term of office (CHF 4,250,000) was within the maximum amount (CHF 4,400,000) approved at the Annual General Meeting (AGM) 2024. Exhibit 1: Board compensation (in CHF) for the 2024–2025 term of office Total compensation 4,250,000 Approved compensation amount 4,400,000 Share ownership of Board members We require our Board members to be ABB shareholders by receiving at least half of their Board compensation in ABB shares. Except for one member who joined the Board in 2023 and two members who joined the Board in 2024, all other Board members held ABB shares at December 31, 2024, worth at least 450 percent of their 2024 Board compensation. Exhibit 2: Board members shareholding (at December 31, 2024) in % of 2024 total compensation * * Based on share price of CHF 37.81, the 2024 Long-Term Incentive Plan (LTIP) reference price, and shares held at December 31, 2024. April 2015 April 2015 April 2016 April 2017 March 2024 March 2023 March 2018 March 2018 April 2016 March 2024 0% 100% 200% 300% 400% 500% 600% 700% Peter Voser David Constable Frederico Curado Lars Förberg Johan Forssell Denise Johnson Jennifer Xin-Zhe Li Geraldine Matchett David Meline Mats Rahmström at 1027% Board appointment ABB COMPENSATION REPORT 2024 7 ─ EXECUTIVE COMMITTEE (EC) COMPENSATION Compensation structure during 2024 Exhibit 3: EC compensation structure during 2024 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 relevant experience; benefits protect against risk Rewards annual Company, business area, functional and individual performance. 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 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 Exposure to ABB share price * EC members with legacy employment contracts have a Target LTIP grant of 100 percent and Maximum LTIP opportunity of 200 percent. The higher LTIP opportunity for the newer EC members is largely offset by lower pension and other benefit costs. 0% 100% 150% Minimum Target Maximum 0% 150% 300% Minimum Target Maximum CEO 0% 150% 300% Minimum Target Maximum Other EC members 80% Group financial results 20% Individual results CEO and corporate officers 50% Average EPS 30% Relative TSR 20% Sustainability All EC members 20% Group financial results 60% Business area financial results 20% Individual results Business area presidents 8 ABB COMPENSATION REPORT 2024 Total EC compensation for 2024 The total EC compensation was CHF 44.5 million in 2024, driven by the strong performance-related variable pay awards and the change in composition of the EC, including the provision of a replacement share grant for an external hire. This amount was slightly higher than the CHF 43.9 million approved at the AGM 2023 for the financial year 2024, due to the impact of the appointment of new members of the EC during 2024. To cover this additional compensation, the Company used the supplementary amount provided for this purpose, in accordance with Art. 35 of the Articles of Incorporation (30 percent of the amount approved at the AGM 2023), whereby the compensation granted was significantly below the maximum amount of CHF 57.1 million (see section “Compensation governance” of this Report). Exhibit 4: EC compensation (in CHF) for 2024 Total compensation 44,514,914 Maximum aggregate compensation approved at the AGM 2023 43,900,000 Maximum aggregate compensation plus 30 percent of such amount in accordance with Article 35 of ABB Ltd’s Article of Incorporation 57,070,000 Compensation of EC members located outside of Switzerland was converted into Swiss Francs, applying average foreign exchange rates for the period the EC member served in their EC role. Exhibit 5 shows the composition of the 2024 total compensation for the EC members at December 31, 2024. The largest portion of the CEO’s 2024 total compensation was delivered via performance driven variable compensation (66 percent), represented by short-term and long-term incentives. The compensation for Morten Wierod in his former role as business area president Electrification (until July 31, 2024) is included under the CEO compensation. For the other EC members, on an aggregate level, variable compensation represented 64 percent of their 2024 total compensation. Note that compensation paid in 2024 for former EC members is not included in Exhibit 5. This can be found in Exhibit 42 in the section “Compensation tables and share ownership tables”. Exhibit 5: 2024 total compensation mix (in CHF) for the CEO and other EC members on aggregate level * Composed of 2024 base salary, 2024 AIP, 2024 LTIP grant, pension benefits, and other benefits. A replacement share grant for the General Counsel and Company Secretary is included in the category Long-term incentive. 2024 AIP represents accrued short-term incentive for the year 2024, which will be paid in 2025, after the publication of ABB's financial results. The sum of percentage figures may differ from 100 percent due to rounding with one decimal. Realized variable compensation in 2024 In addition to the 2024 total compensation, we disclose the realized total compensation for our EC. Realized variable compensation relates to the AIP award and the LTIP award at the end of their respective performance cycles, reflecting actual AIP award and LTIP vesting, based on achievement of the respective plan performance measures. This additional level of transparency is designed to aid stakeholder’s understanding of the link between pay and performance we seek to ensure at ABB. The outcome of the 2024 AIP (Exhibit 6) was above the target for EC members in their year-end roles (119 percent on average), and the LTIP that vested in 2024 (2021 LTIP) exceeded the target level, with a final vesting level at the maximum of 200.0 percent of target (Exhibit 7). 18.0% Base salary 6.1% Pension benefits 10.2% Other benefits 22.9% Short-term incentive 42.7% Long-term incentive CEO Variable compensation 66% Fixed compensation 34% 6,619,005 Other EC members 16.8% Base salary 8.1% Pension benefits 10.8% Other benefits 19.5% Short-term incentive 44.7% Long-term incentive 27,912,581 Variable compensation 64% Fixed compensation 36% ABB COMPENSATION REPORT 2024 9 Exhibit 6: 2024 AIP outcome compared to target (1) The AIP outcome for Morten Wierod relates solely to his role as CEO (from August 1, 2024). (2) On aggregate level, while individual outcomes range from 57 to 135 percent Exhibit 7: 2021 LTIP outcome compared to target Realized total compensation in 2024 Considering the variable components stated above, the realized total compensation in 2024 was above the target for all EC members, driven by strong performance and the high level of achievement against the targets for the 2021 LTIP, which vested in 2024. The compensation for Morten Wierod in his former role as business area president Electrification (until July 31, 2024) is included under the CEO compensation. Exhibit 8: Realized total compensation in 2024 compared to target total compensation Further details related to the realized compensation of each EC member and each compensation component are specified in Exhibit 49. 200% 200% 200% 200% 200% 200% 100% 100% 100% 0% 25% 50% 75% 100% 125% 150% 175% 200% LTIP vesting (total) Average EPS (50% of total) Relative TSR (50% of total) Target achievement level Realized achievement level Maximum achievement level CHF 4,238,359 CHF 17,899,073 CHF 6,594,291 CHF 26,888,036 0 5,000,000 10,000,000 15,000,000 20,000,000 25,000,000 30,000,000 CEO Other EC members Target total compensation Realized total compensation 156% 150% * On an aggregate level, while individual outcomes range from 109 to 163 percent. Other EC members CEO 10 ABB COMPENSATION REPORT 2024 Share ownership of EC members An alignment of our EC members’ personal wealth at risk to the ABB share price and their interests with those of shareholders is important 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 the required share ownership level. Four out of nine EC members exceeded their share ownership requirements. The other five members have been appointed to the EC in the last three years. When considering the number of granted, but unvested, ABB shares of EC members at December 31, 2024, it is expected that four recently appointed EC members who do not currently meet their share ownership requirement are projected to do so by 2027, after vesting of their respective LTIP share grants or replacement share grants. Exhibit 9: EC shareholding compared to share ownership guideline * Based on share price of CHF 37.81, the 2024 LTIP reference price, and shares held at December 31, 2024. Future allocation of granted, but unvested, shares is based on target achievement level and relevant plan specific settlement: default settlement of the final 2022 LTIP, 2023 LTIP and 2024 LTIP, and replacement share awards is 100 percent in shares. The value of shares is compared against the annual base salary net of taxes, at December 31, 2024. April 2019 April 2017 January 2021 November 2024 October 2022 June 2016 January 2015 August 2024 August 2024 0% 200% 400% 600% 800% 1000% 1200% Morten Wierod Timo Ihamuotila Carolina Granat Mathias Gärtner Karin Lepasoon Sami Atiya Peter Terwiesch Brandon Spencer Giampiero Frisio Held shares in % of net salary Granted, but unvested shares Share ownership requirement EC appointment Other EC members share ownership requirement (400%) CEO share ownership requirement (500%) ABB COMPENSATION REPORT 2024 11 — COMPENSATION GOVERNANCE We prepared this Report in accordance with the Swiss Code of Obligations, the Directive on Information relating to Corporate Governance of the SIX Exchange Regulation, and the rules of the stock market of Sweden, where ABB shares are also listed. In addition, we consider the principles of the Swiss Code of Best Practice for Corporate Governance of economiesuisse. ABB’S ARTICLES OF INCORPORATION ABB’s Articles of Incorporation, approved by its shareholders, contain provisions on compensation which govern and outline the principles of compensation relating to our Board of Directors and Executive Committee. They are published on ABB’s Corporate Governance website new.abb.com/about/corporate-governance and summarized below: • Compensation Committee (Articles 28 to 31): The Compensation Committee (CC) is composed of a minimum of three members of the Board and are elected individually by the shareholders at the Annual General Meeting for a period of one year. It supports the Board in establishing and reviewing the compensation strategy and policy, determining the compensation of the Board and the EC, and in preparing the proposals to the AGM on compensation matters. The responsibilities of the CC are defined in more detail in the Board Regulations and Corporate Governance guidelines, which are published on ABB’s Corporate Governance website. • Compensation principles (Article 33): Compensation of the members of the Board consists of fixed compensation only, which is delivered in cash and shares (with an option to elect for shares only). Compensation of the members of the EC consists of fixed and variable compensation. Variable compensation may comprise short-term and long-term elements. Compensation may be paid in cash, shares, or other benefits. • “Say-on-pay” vote (Article 34): Shareholders approve the maximum aggregate amount of compensation of the Board for the following Board term and of the EC for the following financial year. • Supplementary amount for new EC members (Article 35): If the maximum approved aggregate compensation amount is not sufficient to also cover the compensation of newly appointed EC members, up to 30 percent of the last maximum approved aggregate amount shall be available as a supplementary amount to cover the compensation of such new EC members. • Loans (Article 37): Loans may not be granted to members of the Board or of the EC. AUTHORITY LEVELS IN COMPENSATION MATTERS The authority levels of the different bodies on compensation matters are detailed in Exhibit 10. Exhibit 10: Authority levels in compensation matters CEO CC Board AGM Maximum aggregate compensation amount for the EC ● ● ● CEO compensation ● ● Individual compensation of other EC members ● ● Maximum aggregate compensation amount for the Board ● ● ● Individual compensation of Board members ● ● Compensation Policy ● ● Compensation Report ● ● Consultative vote ● Recommendation ● Proposal ● Approval 12 ABB COMPENSATION REPORT 2024 ACTIVITIES OF THE CC IN 2024 The CC meets as often as business requires but at least four times a year. In 2024, the CC held seven meetings and performed the activities described in Exhibit 11. The CEO, the Chief Human Resources Officer (CHRO) and the Head of Performance and Reward also attend all or part of the CC meetings in an advisory capacity. The Chairman of the CC may decide to invite other executives upon consultation with the CEO, as appropriate. Executives do not attend the meetings or the parts of the meetings in which their own compensation and/or performance are being discussed. We provide further details in the section “Board of Directors – Meetings and attendance” of our Corporate Governance Report 2024. Exhibit 11: CC activities during 2024 Strategy Review of AIP design and structure Continued monitoring of link between sustainability and compensation EC compensation Review of compensation benchmarking for EC members (biennial activity) Review of individual compensation for EC members Review of the share ownership of EC members Review of compensation for new and departing EC members Performance – relating to past performance cycle Setting of AIP design, measures and targets for 2024 Assessment of AIP awards for 2024 Assessment of achievement of performance targets for LTIP awards vesting in 2024 Performance – relating to forthcoming performance cycle Consideration of preliminary AIP measures and targets for 2025 Setting of performance targets for LTIP grants in 2024 (vesting in 2027) Consideration of forecast achievement against performance targets for unvested LTIP grants Compliance Review of CC annual plan Review of feedback from Stakeholder Engagement meetings Regulatory and market updates Review of the Compensation Report for publication Preparation of maximum aggregate compensation for the Board to be submitted for AGM vote Preparation of maximum aggregate compensation for the EC to be submitted for AGM vote The Chairman of the CC reports to the full Board regularly, usually after each CC meeting. The minutes of the CC meetings are available to the members of the Board. The CC retains independent, external advisors for compensation matters. In 2024, the CC mandated PricewaterhouseCoopers (PwC) to provide these services. In addition to its CC advisory role, PwC also provided human resources, tax, and advisory services to ABB in 2024. Other external advisors were employed in 2024 by the CC and management. ABB COMPENSATION REPORT 2024 13 — SUSTAINABILITY-RELATED CONSIDERATIONS IN ABB’S COMPENSATION There are a range of sustainability-related considerations which play an important role in our compensation philosophy, including the desire to foster a strong link between ABB’s Sustainability Agenda and the variable compensation for the EC and other executives, as well as the general ambition to reinforce the Company’s social contract with its employees. IMPACT OF SUSTAINABILITY PERFORMANCE ON VARIABLE COMPENSATION Given sustainability is an integral part of ABB’s strategy and plans, we incorporate a strong, direct link between our Sustainability Agenda and executive incentives through our key variable compensation programs such as AIP and LTIP. Regarding the AIP for 2024, all EC members had three sustainability goals (out of a maximum of three) in the individual component of their respective plans. In 2024, all EC members had an environmental goal (scope 1 and 2 greenhouse gas (GHG) emissions). Most of the EC members had a social goal, which for the CEO and business area presidents was safety, and for most corporate officers was an increase in the proportion of women in senior management roles (female leaders), while the CFO had a governance goal related to internal controls. In addition, all EC members had a governance goal designed to help deliver ABB’s obligations under the Deferred Prosecution Agreement (DPA) in line with our commitments to the US Department of Justice. From 2025, we will replace the individual measure under the AIP with two mandatory sustainability goals, with a combined weighting of 10 percent. Regarding the LTIP granted to ABB’s executives in 2024, including the EC, we continued to carry a Company-wide sustainability performance measure in the LTIP with a weighting of 20 percent. • For the 2024 LTIP, our sustainability performance measure was the Company’s scope 1 and 2 GHG emissions reduction at the end of the three-year performance period (2024–2026), compared to the 2019 baseline. • The sustainability measure applied to the 2025 LTIP is the same as that applied to the 2023 and 2024 LTIP, namely scope 1 and 2 GHG emissions reduction at the end of a three-year performance period. The 2025 LTIP targets will be based on scope 1 and 2 GHG emissions reduction over the three-year performance period from 2025–2027, compared to a baseline of the 2024 total scope 1 2 GHG emissions. We disclose the detailed target and award points for the sustainability measure of the 2025 LTIP on page 31 of this Report and publish other details of the long-term GHG emissions reduction in our Sustainability Statement 2024. • We will consider the appropriateness of the sustainability measure for future LTIPs, given the fact that, by the end of the 2025 LTIP cycle (i.e., end of 2027) ABB will have broadly achieved its scope 1 and 2 emissions reduction goals. This activity will be part of an LTIP design review which the CC will undertake during 2025 and will inform LTIP grants from 2026. 14 ABB COMPENSATION REPORT 2024 PROGRAMS FOR ABB EMPLOYEES In addition to the offer of fair and competitive compensation to our employees, we also strive to offer additional programs to reinforce the social contract with our employees. We summarize selected supporting key programs and their links to our Sustainability Agenda in Exhibit 12. Exhibit 12: Selected programs for employees Program Operation and purpose Link to ABB’s Sustainability Agenda Employee Share Acquisition Plan (ESAP) Offered to approx. 104,000 employees in over 60 countries, providing the opportunity to become ABB shareholders and purchase shares in ABB one year after the start of a plan, at a price which gets fixed and confirmed at the beginning of each annual plan cycle. In all ABB locations where ESAP is offered the opportunity for share ownership is the same for permanent full- time and permanent part-time employees at ABB. Supports social goal by allowing employees to share into the Company’s long-term success and aligns employees’ interests with the interests of shareholders. Parental Leave A global and gender-neutral program, offered to all employees, which sets out a minimum standard on paid parental leave that supports all family types. The primary caregivers receive 12 weeks of paid leave and the secondary caregivers four weeks following the birth of a child or when becoming a new parent by adoption or surrogacy. Supports social goals, promotes wellbeing and the ABB value of “Care”. Employee Assistance A global program, offered to all employees. The program supports the employee’s wellbeing by offering paid counseling on emotional health, family concerns and workplace concerns. Supports social goals, promotes wellbeing and the ABB value of “Care”. Mobility Allowance Offered to selected employees based on business need or market practice, with any car provision being progressively migrated to e-vehicles or transportation allowances which can be used to contribute to public transport, cycle, or other transport needs. Supports environmental goals by addressing changed needs related to mobility and providing greater flexibility to opt for more environmentally friendly solutions. ABB COMPENSATION REPORT 2024 15 — BOARD COMPENSATION POLICY We design our compensation policy for the members of the Board of Directors to attract and retain experienced people to the Board. Board compensation levels take into account the responsibilities, time and effort required to fulfill the respective roles on the Board and its committees. COMPETITIVE POSITIONING OF BOARD COMPENSATION The levels and the mix of Board members’ compensation are regularly compared against the compensation of non-executive Board members from a cross-selection of publicly traded companies in Switzerland, excluding financial services, including Alcon, Geberit, Givaudan, Holcim, Kuehne + Nagel, Logitech, Lonza, Nestle, Novartis, Richemont, Roche, Sika, Sonova and Swisscom. Such a review was last undertaken in 2023. There has been no change to the individual Board fees since 2015. BOARD COMPENSATION STRUCTURE A fixed fee is payable to the Chairman, Vice-Chairman (if appointed) and members of the Board, and additional fees are payable for chairing or membership of a Board committee, except for the Chairman and Vice-Chairman (if appointed). Board members are paid for their service over an annual Board term that starts with their election at the AGM. Payment of fees is made in semi-annual installments in arrears. We require our Board members to take 50 percent of their compensation in shares, while they may elect to receive all their fees in shares. The number of shares delivered is calculated prior to each semi-annual fee payment by dividing the monetary amount to which the Board members are entitled by the average closing price of the ABB share over a predefined 30-day period. The delivered shares are subject to a three-year restriction period during which they cannot be sold, transferred, or pledged. Any restricted shares are unblocked when a Board member leaves the Board. BOARD FEES BY ROLE For the term of office from the AGM 2024 to the AGM 2025, there was no adjustment made to Board fees, as set out in Exhibit 13. No Vice-Chairman was appointed for that term of office. Exhibit 13: Board fees (in CHF) by role Chairman of the Board (1) 1,200,000 Member of the Board 290,000 Additional committee fees: Chairman of FACC (2) 110,000 Chairman of CC or GNC (2) 60,000 Member of FACC (2) 40,000 Member of CC or GNC (2) 30,000 (1) The Chairman does not receive any additional committee fees. (2) CC: Compensation Committee, FACC: Finance, Audit and Compliance Committee, GNC: Governance and Nomination Committee. 16 ABB COMPENSATION REPORT 2024 — IMPLEMENTATION OF BOARD COMPENSATION POLICY TOTAL BOARD COMPENSATION The compensation paid to the Board members for the calendar year 2024 and for the term of office from the AGM 2024 to the AGM 2025 are disclosed in Exhibit 14 below. At the AGM 2024, the shareholders approved a maximum aggregate compensation amount of CHF 4.40 million for the 2024–2025 Board term. This amount equals the approved amount for the previous Board term, as both the compensation per Board member and the number of Board members remained unchanged. The Board compensation to be paid for the 2024–2025 Board term is CHF 4.25 million and is therefore within the amount approved by the shareholders. Exhibit 14: Board compensation (in CHF) Board term Board of Directors 2024–2025 2023–2024 Number of members 10 10 Total compensation 4,250,000 4,380,000 Maximum aggregate compensation amount approved at previous AGM 4,400,000 4,400,000 We disclose amounts by individual Board member in Exhibit 15 below, and in Exhibits 38 and 39, respectively, in the section “Compensation tables and share ownership tables”. BOARD FEES BY MEMBER The following Exhibit 15 sets out the fees by member for the 2024–2025 Board term. Exhibit 15: Board fees for the current term of office (in CHF) by member Name Board Compensation Committee Finance, Audit and Compliance Committee Governance and Nomination Committee Total Compensation Peter Voser (1) 1,200,000 - - - 1,200,000 David Constable (2) 290,000 30,000 - - 320,000 Frederico Curado (3) 290,000 60,000 - - 350,000 Lars Förberg (2) 290,000 - - 30,000 320,000 Johan Forssell (2) 290,000 - - 30,000 320,000 Denise Johnson (2) 290,000 - 40,000 - 330,000 Jennifer Xin-Zhe Li (2) 290,000 30,000 - 30,000 350,000 Geraldine Matchett (2) 290,000 - 40,000 - 330,000 David Meline (3) 290,000 - 110,000 - 400,000 Mats Rahmström (2) 290,000 - 40,000 - 330,000 Total 4,250,000 (1) Chairman of the Board, who does not receive any additional committee fee as Chairman of the Governance and Nomination Committee. (2) Member of a Committee. (3) Chairman of a Committee. COMPENSATION OF FORMER BOARD MEMBERS In 2024, we did not make any payment to former Board members other than those disclosed in this Report. ABB COMPENSATION REPORT 2024 17 COMPENSATION FOR SERVICES RENDERED In 2024, we did not pay any fees or compensation to Board members for services rendered to ABB other than those disclosed in this Report. SHARE OWNERSHIP OF BOARD MEMBERS The members of the Board collectively owned less than one percent of ABB’s total shares outstanding at December 31, 2024. Exhibit 2 in the section “At a glance” shows the wealth at risk for each Board member, comparing the value of shares held at December 31, 2024, with the total compensation for the 2024–2025 term of office. Except for one member who joined the Board in 2023 and two members who joined the Board in 2024, all other Board members held ABB shares at December 31, 2024, worth at least 450 percent of their 2024 Board compensation. Exhibit 40 in the section “Compensation tables and share ownership tables” shows the number of ABB shares held by each Board member at December 31, 2024 and 2023. Except as described in Exhibit 40, no member of the Board and no person closely linked to a member of the Board held any shares of ABB. EXTERNAL MANDATES HELD BY BOARD MEMBERS Each ABB Board member held at least one external mandate in other companies. We disclose relevant detailed information in Exhibit 41 in the section “Compensation tables and share ownership tables”. 18 ABB COMPENSATION REPORT 2024 — EXECUTIVE COMMITTEE COMPENSATION POLICY Our EC compensation policy reflects ABB’s commitment to attract, motivate and retain people with the skills and experience necessary to strengthen its position as a leading global technology company. EC COMPENSATION STRUCTURE Our EC compensation structure is designed to be competitive, based on performance, and to encourage executives to deliver outstanding results and create sustainable shareholder value without taking excessive risks. Our EC compensation framework therefore balances fixed and variable compensation. Variable compensation is provided through short-term and long-term incentives based on strategic, financial and sustainability related targets, recognizing Group, business area and corporate function performance, as well as individual performance. This structure is linked to our strategy and is illustrated in Exhibit 3 in the section “At a glance”. A significant portion of total compensation depends on variable pay components, which require the achievement of challenging performance targets, in alignment with ABB’s Annual Performance Plans and Long-Term Performance Plans. • The target AIP award is defined as a percentage of base salary, currently 100 percent for all EC members. If performance is below threshold on all financial and individual performance measures, there is no award under the AIP. When performance exceeds targets, the maximum award is capped at 150 percent of the targeted award. • The target LTIP grant size is defined as a percentage of base salary, currently 150 percent for the CEO and 100 to 150 percent for other EC members. If performance is below threshold for all applicable measures, there is no award under the LTIP. When performance exceeds targets, the maximum award is capped at 200 percent of the conditional grant. The Exhibit below shows the impact of the application of the new compensation policy introduced in 2022, which provides a greater emphasis on variable pay, especially reflected in the long-term component. Exhibit 16: Policy for target compensation mix of EC members (excluding CEO) appointed prior to and after 2022 * Policy change for new EC entrants (excluding the CEO), applying an entry level salary of CHF 700,000 and an incumbent age of 50 years to reflect the pension benefits. Note that, by exception, the new mix of target compensation was not applied to the newly appointed Chief Communications and Sustainability Officer, where a target LTIP of 100 percent of base salary was applied. COMPETITIVE POSITIONING OF EC COMPENSATION The Board and the CC consider competitive market data when setting the compensation policy for the EC. It is also one of several factors in positioning the target compensation for individual EC members which include: • individual profile of the EC member in terms of experience and skills; • individual performance and potential; • market value of the role (compensation benchmarking). 25% 24% 15% 9% 10% 7% 25% 24% 25% 36% EC members pre 2022 EC members post 2022 Base salary Pension benefits Other benefits Short-term incentive Long-term incentive ABB COMPENSATION REPORT 2024 19 Comprehensive EC compensation benchmark reviews are performed every other year. The CC conducted such a review in 2024, considering three distinct peer groups. While each of these peer groups used in the benchmarking exercise, matched the size, scope or complexity of ABB, and excluded companies from the financial services sector, the application of a specific peer group depends on the nature of the role and the source of relevance. For example, our Board places a stronger emphasis on the Global Industry Group for operational roles and in compensation design, and on the Pan-European Market peer group for functional roles. In all cases, the other two peer groups are used to stress test the findings of the primary peer group (see the summary in Exhibit 17 below). Exhibit 17: Peer groups for EC compensation benchmarking Peer group Composition Companies Rationale Global Industry Group A tailored group of 15 global industry peer companies, matching the scale and complexity of ABB AB SKF, Alstom, Airbus, Atlas Copco, Denso, Eaton, Emerson Electric, Honeywell, Mitsubishi Electric, Mitsubishi Heavy Industries, Schneider Electric, Schindler, Siemens, Thermo Fisher Scientific, Traton Focus for CEO role and business area roles and for benchmarking compensation design Pan-European Market A panel of 54 cross-industry European companies, matching the scale and complexity of ABB See footnote (1) Focus for corporate officer roles; continuity and stability of data points Swiss Market A panel of 16 Swiss headquartered companies, matching the scale and complexity of ABB Adecco, Geberit, Givaudan, Glencore, Holcim, Kuehne & Nagel, Nestle, Novartis, Richemont, Roche, Schindler, SGS, Sika, STMicroelectronics, Swatch, Swisscom Swiss location of headquarters (1) AB InBev, Adidas, Air Liquide, Airbus, Associated British Foods, AstraZeneca, Atlas Copco, BAE Systems, Bayer, Bouygues, British American Tobacco, Compass Group, Continental, CRH, Danone, Endesa, Ericsson, EssilorLuxottica, Fresenius, Fresenius Medical Care, GlaxoSmithKline, Heidelberg Materials, Heineken, Henkel, Hennes & Mauritz, Holcim, Iberdrola, Imperial Brands, Industria de Diseno Textil, Jeronimo Martins, Kuehne + Nagel, Linde, L’Oreal, Michelin, National Grid, Naturgy Energy Group, Nokia, Novartis, Novo Nordisk, OMV, Philips, Rio Tinto, Safran, Saint Gobain, Sanofi, SAP, Schneider Electric, Siemens, Thales, Umicore, Unilever, Veolia Environment, Vinci and Vodafone. It is the intention to position target compensation for individual EC members between the median and upper quartile of the relevant peer group(s) considering the other factors referenced above (e.g., the EC member’s skills, experience, performance and potential). The comparison of ABB to its compensation benchmarking peer groups is shown in Exhibit 18. This data shows that ABB is typically positioned around the median of key comparator indicators (market capitalization, revenues, and number of employees) against the Global Industry Group and Pan-European Market peer group, and around the upper quartile of the Swiss Market peer group. The next EC compensation benchmarking review is planned to take place in 2026. 20 ABB COMPENSATION REPORT 2024 Exhibit 18: Comparison of ABB to compensation benchmarking peer groups Market capitalization (1)(2)(3)(4) Revenues (1)(2)(4)(5) Number of employees (1)(5)(6) ABB 90.5 27.1 107,900 Global Industry Group Upper Quartile 112.8 39.3 148,514 Median 54.5 30.9 95,000 Lower Quartile 27.4 15.8 74,052 Pan-European Market Upper Quartile 94.3 38.5 134,156 Median 44.3 28.7 89,288 Lower Quartile 20.3 22.0 63,390 Swiss Market Upper Quartile 63.0 30.1 77,899 Median 35.4 17.3 57,386 Lower Quartile 23.2 10.3 33,588 (1) Data are sourced from Thomson Reuters and London Stock Exchange Group. (2) Market capitalization and revenues are in CHF billions. (3) Market capitalization is averaged over a period of three months (June 9, 2024, to September 9, 2024). (4) All currencies have been converted to CHF, where needed, applying full-year average currency exchange rates based on the period from July 1, 2023, to June 30, 2024. (5) Revenues and number of employees as per last financial year prior to October 2024. (6) Number of employees in full-time equivalent (FTE) unless FTE information was not available, then in total number of employees. COMPENSATION ELEMENTS For each element we set out the purpose and link to strategy, the operation, the opportunity level and the performance measures in Exhibit 3 of the section “At a glance”. This section provides further details for each compensation element. Fixed compensation – base salary and benefits Purpose and link to strategy Facilitate the attraction and retention of skilled and experienced EC members; base salary compensates for the role and relevant experience; benefits protect against risks. Base salary is paid in cash. Benefits consist primarily of retirement, insurance and healthcare plans that are designed to provide a reasonable level of support for the employees and their dependents in case of retirement, disability or death. Opportunity levels Base salary is set with reference to the scope of responsibilities, personal experience and skills, and competitive market data. Benefit plans are set in line with the local competitive and legal environment and are, at a minimum, in accordance with the legal requirements of the respective country. Performance measures and weighting Base salary is adjusted considering the factors set out under opportunity levels above, the executive’s performance as well as their future potential. Variable compensation – Annual Incentive Plan (AIP) Purpose and link to strategy We designed our AIP to reward EC members for the Group’s results, the results of their business area or corporate function and their individual performance over a time horizon of one year, in alignment with our Annual Performance Plan approved by the Board. ABB COMPENSATION REPORT 2024 21 Opportunity levels The AIP opportunity levels for the EC are 100 percent of base salary at target with a maximum opportunity of 150 percent. Performance measures and weighting We structured the AIP to incentivize operational delivery and underpin our performance culture. As such, it is focused on our annual key priorities, with a maximum of six measures. • A collaborative Group financial measure with a 20 to 40 percent weighting. • Up to four Group or business area financial measures, with a 40 to 60 percent weighting. • An individual measure with a 20 percent weighting. This individual component is informed by up to three goals which may include a combination of quantitative and qualitative goals. o From 2022, at least two of these goals relate to sustainability. o The outcome against this individual measure is a discretionary judgment by the CC based on the combined performance against all individual goals. A summary of the composition and total weighting of the measures for all EC members is set out in Exhibit 19. Exhibit 19: Composition and weighting of AIP measures for EC members CEO and corporate officers (1) Business area presidents Collaborative Group financial measure 40% 20% Other Group financial measures Up to three measures n.a. 40% Business area financial measures n.a. Up to four measures 60% Individual measure Includes up to three goals (minimum two must relate to sustainability) Includes up to three goals (minimum two must relate to sustainability) 20% 20% Total 100% 100% (1) Corporate officers include Chief Financial Officer, Chief Human Resources Officer, General Counsel and Company Secretary, and Chief Communications and Sustainability Officer. Other design features For each measure a target level, corresponding to the expected level of performance that will generate a target (100 percent) award, will be set. For each measure a minimum level of performance, below which there is no award (threshold) and a maximum level of performance, above which the award is capped at 150 percent of the target (maximum) award, will also be set. The payment conditions for financial AIP measures are summarized in Exhibit 20. For Group and business area financial measures, the award percentage achievements between threshold and target level, as well as between target and maximum level are determined by linear interpolations between these award points. Exhibit 20: Payment conditions for the AIP of EC members Level of performance Below threshold Threshold Target Maximum Award achievement per measure 0% >0% 100% 150% The outcomes of the financial AIP measures are subject to appropriate discretionary upward or downward adjustments by the CC for non-operational items and other adjustment principles agreed with the Board, if and to the extent the CC considers this appropriate. In addition, the CC/Board have discretionary authority to adjust the results and/or the AIP award. This specifically includes a downwards adjustment based on safety performance, including fatalities. As of 2024, our AIP offering for EC members is subject to malus and clawback provisions, which include illegal activities, any financial misstatement and reputational damage that have a material impact on ABB Ltd or one of our subsidiaries. This means that the Board may decide not to award any unpaid AIP award (malus) to EC members or may seek to recover AIP compensation that has been settled in the past (clawback) to EC members. The clawback provision applies for a period of up to three years following the date that any AIP award was paid. 22 ABB COMPENSATION REPORT 2024 From 2025, we intend to increase the weighting of the financial measures under the AIP from 80 percent to 90 percent and replace the individual measure with two mandatory sustainability targets, with a combined weighting of 10 percent. Variable compensation – Long-Term Incentive Plan (LTIP) Purpose and link to strategy Rewards the achievement of predefined performance targets over a three-year period. Encourages the creation of long-term, sustainable shareholder value creation and is aligned with our Long-Term Performance Plan approved by the Board. Opportunity levels We offer the LTIP in the form of Performance Share Unit (PSU) grants to approximately 100 executives. The LTIP described in this Report represents the PSU plan and as such is applicable to EC members. In addition, we offer another LTIP in the form of Restricted Share Unit (RSU) grants to approximately 850 senior leaders and selected key employees below the executive level. For the CEO, the annual LTIP opportunity level is 150 percent of base salary at target, with a maximum opportunity of 300 percent of base salary. As a result of the policy change announced in our Compensation Report 2021, the annual target and maximum opportunity levels for EC members range from 100 to 200 percent of annual base salary (old policy application) and from 150 to 300 percent of annual base salary (new policy), respectively. Our Board has the discretionary option not to make any grants in certain circumstances. The relative opportunity level under our LTIP offering is the same for permanent full-time and permanent part- time employees. Performance measures and weighting The LTIP has, since 2022, three performance measures with the following relative weighting: Earnings Per Share (EPS) – 50 percent weighting • Achievement against this measure is determined by ABB’s average EPS over a three-year period. The average EPS result is calculated from the sum of the EPS for each of the three relevant years, divided by three. • EPS is defined as diluted earnings per share attributable to ABB shareholders, calculated using Income from continuing operations, net of tax, unless the Board elects to calculate using Net income for a particular year. • Appropriate threshold (zero), target (100 percent) and maximum (200 percent) award points are reviewed by the CC on an annual basis. • Performance target and award points are set using our Long-Term Performance Plan and are calibrated with an independent “outside-in” view, considering the growth expectations, risk profile, investment levels and profitability levels that are typical for the industry. • Adjustments to the outcome of the EPS achievement level may be considered for items which are not part of, or the result of, the normal course of business operations and/or which were not considered, either by way of inclusion or exclusion, for the target-setting of a specific LTIP launch. Only the net impact of such adjustments over the vesting period of the respective LTIP grant will be considered. The impact of share buybacks will not be considered as an adjustment. The same number of outstanding shares applicable at the time of the EPS target-setting will also be applied at the time of vesting. Total Shareholder Return (TSR) – 30 percent weighting • The TSR calculations are made for the reference period beginning in the year of the conditional grant of the shares and ending three years later. The evaluation is performed by an independent third party. • Achievement against this measure is determined by ABB’s relative TSR performance over the three- year vesting period against a defined peer group, which currently includes 3M, Danaher, Eaton, Emerson Electric, General Electric, Holcim, Honeywell Intl., Legrand, Mitsubishi Electric, Raytheon Technologies, Rockwell, Rolls-Royce, Schneider Electric, Siemens, and Yokogawa. ABB COMPENSATION REPORT 2024 23 • The threshold point for awards, above which vesting starts, corresponds to the 50 th percentile (P50) of the TSR peer group, i.e., there is no vesting for performance below P50. • Vesting for P50 achievement equals to 100 percent of target and vesting for a 75 th percentile (P75) achievement level remains at 200 percent of target (maximum). There is a linear vesting for an achievement between P50 and P75 (100 to 200 percent of target). • The constituents of the peer group and the appropriate threshold, target and maximum award points are reviewed by the CC on an annual basis. Sustainability – 20 percent weighting • The Board determines, on an annual basis, the LTIP specific sustainability measure(s), as well as related target(s) and award points, to incentivize material progress towards our Sustainability Agenda commitments. • Appropriate threshold (zero), target (100 percent) and maximum (200 percent) award points are reviewed and approved by the CC on an annual basis. • Adjustments to the outcome of the sustainability achievement may be considered for items which are not part of, or the result of the normal course of business operations and/or which were not considered, either by way of inclusion or exclusion, for the target-setting of a specific LTIP launch. Only the net impact of such adjustments over the vesting period of the respective LTIP grant will be considered. Other design features The number of shares to be granted is determined by dividing the relevant grant value in Swiss Francs by the average ABB share price on the SIX Swiss Exchange over the period of 20 trading days prior, and 20 trading days after, the date of publication of ABB’s full year financial results. Settlement of the LTIP shares is three years after grant, subject to achievement of performance conditions, defined prior to grant. The vesting schedule for the LTIP is shown in the following Exhibit 21. The award percentage achievements between threshold and target, as well as between target and maximum, are determined by linear interpolations between these award points. Exhibit 21: Vesting schedule for the LTIP of EC members Level of performance Below threshold Threshold Target Maximum Award achievement per measure 0% >0% 100% 200% * For the TSR measure, the threshold point equals the target point. As from the 2023 LTIP offering, the CC has the discretion to adjust the formulaic LTIP vesting outcome to reflect the overall performance of ABB, over the performance period. Default settlement of the final LTIP award is 100 percent in shares with an automatic sell-to-cover in place for employees who are subject to withholding taxes. Our LTIP share grants are subject to malus and clawback provisions, which include illegal activities, any financial misstatement and reputational damage that have a material impact on ABB Ltd or one of its subsidiaries. This means that the Board may decide not to award any unsettled or unvested LTIP grants (malus) or may seek to recover LTIP awards that have been settled in the past (clawback). Clawback applies for a period of up to five years following the originally scheduled plan specific vesting date. The CC also has the ability to suspend the delivery of awards if it is likely that the Board will determine that the malus or clawback provisions may potentially apply (e.g., if the employee is subject to an external investigation). In the event of a change of control, there is no automatic accelerated vesting of LTIP awards. For LTIP grants from 2022, participants are entitled to receive a cash amount (a “dividend equivalent payment”) on each vested award share that is equal to the total dividends per share paid by the Company on the ABB Ltd share between the grant date and the delivery date of the vested award. The CC plans to conduct a review of ABB’s long-term incentive arrangements during 2025 to ensure they remain aligned with our business requirements and market best practices. 24 ABB COMPENSATION REPORT 2024 Wealth at risk / Share ownership Purpose and link to strategy Aligns EC members’ personal wealth directly with the interests of shareholders to maintain focus on the long- term success of the Company. Share ownership program EC members are normally required to retain all vested shares from their LTIP grants and from any other share- based compensation until they meet their share ownership requirement. In circumstances where there is a withholding tax obligation, the number of shares received will be considered to be the number of shares vested minus the shares sold under the default sell-to-cover facility. The share ownership requirement is equivalent to a multiple of the EC member’s annual base salary, net of taxes (see Exhibit 3 in the section “At a glance”). These share ownership requirements are aligned with market practice and result in a wealth at risk for each EC member which is aligned with shareholder interests. Only vested shares owned by an EC member and their spouse count for the comparison of the actual share ownership against the share ownership requirement. The CC reviews the status of EC share ownership on an annual basis. Notice period, severance provisions and non-competition clauses Employment contracts for EC members include a notice period of 12 months, during which they are entitled to their annual base salary, short-term incentive, and benefits. In accordance with Swiss law and ABB’s Articles of Incorporation, the contracts for the EC members do not allow for any severance payment. Non-compete agreements may be entered into with the CEO and all other EC members for a period of 12 months after their employment. Compensation for such agreements, if any, may not exceed the EC member’s last total annual cash remuneration (comprising of base salary, short-term incentive and benefits). ABB COMPENSATION REPORT 2024 25 — IMPLEMENTATION OF EC COMPENSATION POLICY OVERVIEW The total EC compensation was CHF 44.5 million in 2024, driven by the strong performance-related variable pay awards and the change in composition of the EC, including the provision of a replacement share grant for an external hire, as summarized in Exhibit 22, and presented in detail in Exhibits 42 and 43. The actual compensation of CHF 44.5 million paid to EC members in 2024 was slightly higher than the amount of CHF 43.9 million approved at the AGM 2023 for the financial year 2024. This was due to the appointment of new members of the EC during the financial year 2024. To cover this additional compensation, the Company used the supplementary amount provided for this purpose in accordance with Art. 35 of the Articles of Incorporation, whereby the compensation granted was significantly below the maximum amount (including the supplementary amount of a maximum of 30 percent of the approved total amount) of CHF 57.1 million. Exhibit 22: Total compensation of EC members (monetary values in CHF) (1) Calendar year 2024 2023 Base salaries 8,650,473 8,430,879 Pension benefits 3,895,706 4,341,781 Other benefits (2) 6,345,842 6,041,342 Total fixed compensation 18,892,021 18,814,002 Short-term incentives (3) 10,306,621 12,088,564 Long-term incentives (fair value at grant) 11,742,706 9,739,902 Replacement share grants 3,573,566 n.a. Total variable compensation 25,622,893 21,828,466 Total compensation 44,514,914 40,642,468 Maximum aggregate compensation approved at the AGM 2023 43,900,000 45,900,000 Maximum aggregate compensation plus 30 percent of such amount in accordance with Art. 35 of ABB Ltd’s Articles of Incorporation 57,070,000 n.a. (1) Compensation of Brandon Spencer was converted from USD to CHF applying an average foreign exchange rate of 0.8677, and compensation of Giampiero Frisio was converted from EUR to CHF applying an average foreign exchange rate of 0.9390. For an overview of compensation by individual and component, please refer to Exhibits 42 and 43 in the section “Compensation tables and share ownership tables”. An overview of 2024 realized compensation by individual is provided in Exhibit 49 in the same section. (2) Other benefits mainly comprise payments related to social security, health insurance, transportation, tax advice and certain other items. (3) Represents accrued short-term variable compensation for the year 2024, which will be paid in 2025, after the publication of ABB’s financial results. Short-term variable compensation is linked to the targets and goals defined in each EC member’s Annual Incentive Plan. COMPENSATION MIX The ratio of fixed to variable compensation in any given year depends on the performance of the Company and individual EC members against predefined performance targets. In Exhibit 5 in the section “At a glance” we show the composition of the total annual compensation in 2024 for the CEO and for the other current EC members on an aggregate level, specifying the split of its five compensation components. 26 ABB COMPENSATION REPORT 2024 In 2024, the variable compensation of the CEO was 66 percent of his total annual compensation (previous year: 55 percent). The compensation for Morten Wierod in his former role as business area president Electrification (until July 31, 2024) is included under the CEO compensation. For the other EC members, the variable compensation was 64 percent on average (previous year: 52 percent). The increase of the variable portion of the total compensation of the CEO, compared to the prior year, is driven by the lower total fixed compensation, representing a mix of the compensation paid related to the BA President position and the CEO position. The increase of the variable portion of the total compensation of the other EC members reflects the impact of the replacement share grant, which can be considered as an exception. Therefore, the proportion between fix and variable compensation for future years is expected to be at similar levels as in previous years. Note that compensation paid in 2024 for former EC members is not included in Exhibit 5. This can be found in Exhibit 42 in the section “Compensation tables and share ownership tables”. COMPENSATION ELEMENTS – 2024 HIGHLIGHTS Base salary As a result of the regular compensation review for the EC, the Board and the CC decided that the salaries of all nine EC members in place in March 2024 remain unchanged. Annual Incentive Plan (AIP) – design Under the 2024 AIP, all EC members had one collaborative Group measure, Group Operational EBITA margin, with a 20 percent weighting for the business area presidents and a 40 percent weighting for the CEO and the corporate officers. In addition to this collaborative Group measure, the CEO and the corporate officers shared other Group measures, including Free Cash Flow conversion to Net Income, Revenues and Return on Capital employed (ROCE), with a total weighting of 40 percent. All business area presidents had, in addition to the collaborative Group measure, three or four measures which were tailored to business imperatives, with a total weighting of 60 percent, including Operational EBITA margin, Net working capital (13 months % avg), Operational revenue gross profit productivity growth and Revenues. ABB COMPENSATION REPORT 2024 27 In Exhibit 23 we show the composition and weighting of the financial measures applied in 2024 for all EC members under their AIP, specified by their roles. Definitions of the financial measures applied for all EC members are set out in Exhibit 24. Exhibit 23: Composition and weighting of 2024 AIP measures for EC members Performance measure CEO and corporate officers (1) President Electrification President Motion President Process Automation President Robotics & Discrete Automation Collaborative Group financial measure Op EBITA margin 40% 20% 20% 20% 20% Other Group financial measures Free Cash Flow conversion to Net Income 20% ROCE 10% Revenues 10% Business area financial measures Op EBITA margin 20% 25% 25% 30% Net working capital (13 months % avg) 15% 25% 15% 20% Operational revenues gross profit productivity growth 10% 10% 10% 10% Revenues 15% 10% Individual measure GHG emissions, Governance, Female leaders, Safety, Internal controls 20% GHG emissions, Safety, Governance 20% 20% 20% 20% Total 100% 100% 100% 100% 100% (1) Corporate officers include Chief Financial Officer, Chief Human Resources Officer, General Counsel and Company Secretary, and Chief Communications and Sustainability Officer. Exhibit 24: Definition of financial measures applied under the 2024 AIP for EC members Measure Description Operational EBITA margin (%) (1) Operational EBITA, which is Operational earnings before interest, tax, and acquisition-related amortization, as a percentage of Operational revenues, which is total revenues adjusted for foreign exchange/commodity timing differences in total revenues. ROCE (%) (1) Return on Capital employed (ROCE) is calculated as Operational EBITA after tax, divided by the average of the period’s opening and closing Capital employed, adjusted to reflect impacts from the timing of significant acquisitions/divestments occurring during the period. Revenues Amount of consolidated revenues recognized during the year in accordance with USGAAP. Free Cash Flow conversion to Net Income (1) Free cash flow conversion to net income is calculated as free cash flow divided by net income attributable to ABB adjusted for gains or losses arising on sale of certain businesses and certain other significant items within net income which are also excluded / adjusted for when calculating operating cashflows. Operational revenue gross profit productivity growth (%) Operational revenue gross profit productivity is calculated as the 12-month rolling operational revenue gross profit divided by the average number of total workforce in the last three months. Where operational revenue gross profit is calculated as gross profit (as defined under USGAAP) adjusted for the following non-operational items to the extent that they are included within the USGAAP gross profit amount: (i) foreign exchange/commodity timing differences, (ii) acquisition- related amortization, (iii) restructuring, related and implementation costs, (iv) changes in obligations related to divested businesses, (v) changes in pre-acquisition estimates, (vi) acquisition- and divestment-related expenses and integration costs, (vii) other income/expense relating to the Power Grids joint venture and (viii) certain other non-operational items. Growth is the change in productivity over the same period a year earlier, represented as a percentage change. Net working capital (13 months % avg) Average Net working capital (1) over 13 consecutive month-ends (December 2023 through December 2024), expressed as a percentage of Operational revenues (1) . Calculated using constant exchange rates. (1) Full definition can be found in the section “Alternative performance measures” in our Integrated Report 2024. 28 ABB COMPENSATION REPORT 2024 All EC members also had an individual measure with a 20 percent weighting. This individual component was informed by a combination of up to three quantitative and qualitative goals. In 2024, all three goals related to sustainability. All EC members had an environmental goal (scope 1 and 2 GHG emissions), and a governance goal designed to help deliver the Deferred Prosecution Agreement in line with our commitments to the US Department of Justice. In addition, most of the EC members had a social goal, which for the CEO and business area presidents was related to safety, and for most of the corporate officers, was related to an increase in the proportion of women in senior management roles (female leaders), while the CFO had a governance goal related to internal controls. The outcome against the individual measure was based on the Compensation Committee’s discretionary judgment of the combined performance against all three goals. Outcomes may be subject to appropriate adjustments for some non-operational items and other adjustment principles agreed with the Board. No adjustments were applied in 2024. 2024 Annual Incentive Plan (AIP) – achievements We summarize the 2024 AIP achievements per applied measure for the CEO and the corporate officers, and business area presidents, respectively, in Exhibit 25, and set out individual AIP outcomes per EC member in comparison to their target 2024 AIP in Exhibit 26. Exhibit 25: 2024 AIP outcomes for the CEO and the corporate officers (rounded) 2024 AIP outcomes for the business area presidents (rounded) ABB COMPENSATION REPORT 2024 29 Exhibit 26: Overview of targeted and realized 2024 AIP values Collaborative Group measure Other Group measures Business area measures Individual measure Total AIP outcome percentage (in % of target) Target AIP award (in CHF) Actual AIP award (in CHF) (1) Achievement Weighting Outcome Achievement Weighting Outcome Achievement Weighting Outcome Achievement Weighting Outcome Morten Wierod (2) 150.0% 40% 60.0% 101.7% 40% 40.7% n.a. n.a. n.a. 100.0% 20% 20.0% 120.7% 625,000 754,375 Morten Wierod (3) 150.0% 20% 30.0% n.a. n.a. n.a. 140.7% 60% 84.4% 100.0% 20% 20.0% 134.4% 568,750 764,400 Timo Ihamuotila 150.0% 40% 60.0% 101.7% 40% 40.7% n.a. n.a. n.a. 120.0% 20% 24.0% 124.7% 990,000 1,234,530 Carolina Granat 150.0% 40% 60.0% 101.7% 40% 40.7% n.a. n.a. n.a. 112.0% 20% 22.4% 123.1% 725,000 892,475 Mathias Gärtner 150.0% 40% 60.0% 101.7% 40% 40.7% n.a. n.a. n.a. 112.0% 20% 22.4% 123.1% 133,334 164,134 Karin Lepasoon 150.0% 40% 60.0% 101.7% 40% 40.7% n.a. n.a. n.a. 112.0% 20% 22.4% 123.1% 600,000 738,600 Sami Atiya 150.0% 20% 30.0% n.a. n.a. n.a. 5.0% 60% 3.0% 122.0% 20% 24.4% 57.4% 800,000 459,200 Peter Terwiesch 150.0% 20% 30.0% n.a. n.a. n.a. 141.3% 60% 84.8% 100.0% 20% 20.0% 134.8% 860,000 1,159,280 Brandon Spencer (4) 150.0% 20% 30.0% n.a. n.a. n.a. 136.8% 60% 82.1% 100.0% 20% 20.0% 132.1% 278,387 367,750 Giampiero Frisio (4) 150.0% 20% 30.0% n.a. n.a. n.a. 140.7% 60% 84.4% 100.0% 20% 20.0% 134.4% 314,956 423,302 Total 5,895,427 6,958,046 (1) Represents accrued AIP award for the year 2024, which will be paid in 2025, after the publication of ABB's financial results. (2) CEO as of August 1, 2024. (3) Business area president Electrification until July 31, 2024. (4) Compensation of Brandon Spencer was converted from USD to CHF applying an average foreign exchange rate of 0.8677, and compensation of Giampiero Frisio was converted from EUR to CHF applying an average foreign exchange rate of 0.9390. CEO retrospective AIP target disclosure In 2023, we introduced two new exhibits in response to shareholder feedback and provide an additional level of transparency on the alignment between pay and performance. The following Exhibit 27 sets out target and award points for each measure under the CEO’s 2024 AIP and the related composition of the final award level. Exhibit 27: 2024 AIP outcomes for the CEO (rounded) (1) Category Performance measure W eight Target (100% award) Actual Award (% of target) Weighted award Collaborative Group financial measure Op EBITA margin (%) 40% 17.0 18.1 150.0% 60.0% Other Group financial measures Free Cash Flow conversion to Net Income (%) 20% 100.0 100.4% 101.2% 20.2% ROCE margin (%) 10% 21.5 22.4 140.4% 14.0% Revenues ($ in millions) 10% 33,465.8 32,873.2 64.6% 6.5% Individual measure Scope 1 and 2 GHG emissions, Governance, Safety 20% See (2) See (2) 100.0% 20.0% Total 120.7% (1) The computation of targets as well as the measurement of actual performance against those targets are based on foreign exchange rates set prior to the start of the performance period. Therefore, targets and actuals under the AIP do not agree with the equivalent measure calculated based on the actual results as presented in ABB’s Consolidated Financial Statements. (2) The achievement of the individual measure is discretionarily assessed by the Compensation Committee and approved by the Board, based on an overall outcome of all three performance goals under the individual measure. For 2024, these performance goals included a target for the scope 1 and 2 GHG emissions, a reduction of the Lost Time Injury Frequency Rate (LTIFR) compared to the 2019 baseline, and the delivery of the Deferred Prosecution Agreement in line with our commitments to the US Department of Justice. See Exhibit 28 for the achievement of goals against the individual measure. Exhibit 28 sets out the target, actual and assessed outcome of the individual goals, which inform the individual measure for the CEO. The overall outcome of the individual measure is a discretionary judgement based on performance against all three goals. 30 ABB COMPENSATION REPORT 2024 Exhibit 28: Achievement against the 2024 performance goals under the individual measure for the CEO Goal Performance measure Target Actual Assessment Scope 1 and 2 GHG emissions 2024 emissions (kt) (1) 142.0 137.5 Better than target Safety 2024 Lost Time Incident Frequency Rate (2) 0.124 0.149 Below target Governance Deliver DPA in line with our commitments to the DOJ (3) Discretionary assessment by the Board Discretionary assessment by the Board Exceeded goal Total 100.0% (1) ABB’s GHG emissions include direct emissions (scope 1) from burning of fuels (oil, diesel, gas) at our sites, SF 6 emissions in own operations, fleet emissions and indirect emissions (scope 2) from our use of electricity and district heating/cooling. (2) Lost Time Incident Frequency Rate (LTIFR) covers workplace incidents (ABB facility, project site, customer site) to ABB employees and contractors; LTIFR formula = number of lost time incidents and serious injury incidents with time lost * 200,000 / work hours (employees + contractors). Rate per 200,000 work hours (equivalent to 100 persons working one calendar year). Eligible managers with direct reports are required to complete a minimum of two Safety Observation Tours (SOT) before an award is made under LTIFR. The baseline is represented by the 2019 LTIFR. (3) Contribution to the delivery of our commitments under the Deferred Prosecution Agreement with the US Department of Justice related to the Kusile project. CEO AIP outcomes in the last five years In Exhibit 29, we show the historical AIP award outcomes for our CEO over the last 5 years. Over this time, the payout averaged 119.9 percent of target and 80.0 percent of the maximum award. Exhibit 29: CEO AIP historical award percentages (1) (1) These refer to Björn Rosengren for the period from 2020 to 2023. For 2024 this represents the AIP award percentage for Morten Wierod. Long-Term Incentive (LTIP) 2024 LTIP grants The estimated value at grant of the share-based grants to EC members at December 31, 2024 under the 2024 LTIP was CHF 11.7 million, compared with CHF 8.7 million in 2023 granted to EC members at December 31, 2023 under the 2023 LTIP. The reference price for the 2024 LTIP grant used to determine the number of shares granted to participants was CHF 37.81. The 2024 LTIP is based on three performance measures: our EPS, our TSR and a sustainability measure. We consider targets and award points under the EPS measure as commercially sensitive information and will only disclose these retrospectively after the end of the relevant LTIP performance period. As in the previous year, we kept the achievement of the EPS threshold point challenging for the 2024 LTIP by applying a range between the EPS target and award points of plus/minus 11.5 percent of target, to reflect the perceived EPS volatility during the performance period. The peer companies approved by the Board to determine our relative TSR performance for the 2024 LTIP are as set out in the previous section “Executive Committee compensation policy” on page 22. 43.3% 96.7% 80.0% 99.3% 80.5% 65.0% 145.0% 120.0% 149.0% 120.7% 0% 50% 100% 150% 2020 AIP 2021 AIP 2022 AIP 2023 AIP 2024 AIP CEO AIP award in % of maximum potential award CEO AIP award in % of target award ABB COMPENSATION REPORT 2024 31 The sustainability measure applied to the 2023 LTIP was also applied in the 2024 LTIP, namely the scope 1 and 2 GHG emissions reduction at the end of the three-year performance period (2024–2026), compared to the 2019 baseline, which was defined without the divested Power Grids business. The targets and award points under the 2024 LTIP have been structured to reflect our progress to date, its long-term ambitions, and that as the targets get higher, the overall stretch to achieve them is even more challenging. Details of the long-term GHG emissions reduction targets can be found in our Sustainability Statement 2024. The approved target and award points for all three performance measures under the 2024 LTIP are illustrated in Exhibit 30 below. Exhibit 30: 2024 LTIP target and award points Measure Weighting Threshold Target Maximum Average EPS 50% Target point -11.5% Disclosed after performance period (1) Target point +11.5% Relative TSR 30% 50 th percentile 75 th percentile Reduction of scope 1 and 2 CO 2 equivalent emissions compared to 2019 baseline 20% 77.0% 81.0% 85.0% Below threshold point: no award; At target point: 100 percent award; At or above maximum point: capped at 200 percent award; Linear interpolations between award points; (1) The average EPS target is not prospectively disclosed for reasons of commercial sensitivity. 2025 LTIP grants The sustainability measure applied to the 2025 LTIP is the same as that applied to the 2023 and 2024 LTIP, namely scope 1 and 2 GHG emissions reduction at the end of a three-year performance period. For the 2025 LTIP, the target will represent a further scope 1 and 2 GHG emissions reduction over the three-year performance period (2025-2027), compared to a baseline of the 2024 total scope 1 and 2, which already considers the significant cumulative improvements of the last several years. Exhibit 31 details the target and award points for the 2025 LTIP. We provide further context behind our long-term GHG emissions reduction targets in our Sustainability Statement 2024. Exhibit 31: Sustainability target and award points for the 2025 LTIP Measure Weighting Threshold Target Maximum Reduction of scope 1 and 2 CO 2 equivalent emissions (1) 20% 6.1% 14.5% 22.9% Below threshold point: no award; At target point: 100 percent award; At or above maximum point: capped at 200 percent award; Linear interpolations between award points. (1) Compared to the 2024 total scope 1 and scope 2 GHG emissions. 2021 LTIP – achievements The final number of shares vesting under the 2021 LTIP grant in 2024 was determined based on the achievement level against the predefined TSR and EPS targets. The relative ranking of ABB’s TSR measure against the predefined peer group of companies for the 2021 LTIP sat in the 77 th percentile, which led to a vesting level of 200.0 percent (previous year: 200.0 percent) out of a potential of 200 percent. The three-year average EPS amounted to $1.57, which led to a vesting level of 200.0 percent (previous year: 179.0 percent) out of a potential 200 percent, net of adjustments for items considered outside the normal course of business operation and/or which were not considered in the target-setting of the 2021 LTIP. Adjustments were made to the EPS for each of the relevant financial years to reflect significant unplanned developments after the LTIP grant, both positive and negative, mainly including for the impact of divestments, M&A-related integration and restructuring costs. 32 ABB COMPENSATION REPORT 2024 In line with our commitment to retrospectively disclose the EPS performance targets for vested LTIP awards, we disclose the three target and award points (threshold, target and maximum) and the actual achievement for the adjusted 2021 EPS performance measure in Exhibit 32 below. The average weighted achievement level of the two performance measures under the 2021 LTIP was 200.0 percent (out of a maximum 200 percent), as specified in Exhibit 32. Exhibit 32: Target point, award points (rounded) and achievement levels of 2021 LTIP performance measures Measure Weighting Threshold Target Maximum Actual Relative TSR 50% 25 th percentile 50 th percentile 75 th percentile 77 th percentile Achievement level 0% 100% 200% 200.0% Average EPS ($) 50% 1.02 1.19 1.36 1.57 Achievement level 0% 100% 200% 200.0% Award as percentage of target (maximum at 200%) 200.0% Overview of disclosed and realized 2021 LTIP value In the following Exhibit 33 we compare the previously disclosed “fair value” of each EC member’s 2021 LTIP grant and the actual value of their respective award at the time of vesting in 2024. This indicates the average realized 2021 LTIP value was 353.2 percent of the grant fair value. The values presented are gross and before payment of any applicable taxes owed by the recipient. Exhibit 33: Realized value of 2021 LTIP grant for current EC members Grant date Number of shares granted related to the TSR measure (1) Shares granted related to the EPS measure (2) Total number of shares granted Disclosed grant fair value (CHF) (3) Vesting date Vesting percentage Number of vested shares (4) Realized value (CHF) (5) Morten Wierod (6) April 26, 2021 15,044 15,043 30,087 793,997 April 26, 2024 200.0% 62,402 2,804,346 Timo Ihamuotila April 26, 2021 18,240 18,240 36,480 962,708 April 26, 2024 200.0% 75,660 3,400,161 Carolina Granat April 26, 2021 13,163 13,163 26,326 694,744 April 26, 2024 200.0% 54,602 2,453,814 Mathias Gärtner n.a. n.a. Karin Lepasoon n.a. n.a. Sami Atiya April 26, 2021 15,044 15,043 30,087 793,997 April 26, 2024 200.0% 62,402 2,804,346 Peter Terwiesch April 26, 2021 15,044 15,043 30,087 793,997 April 26, 2024 200.0% 62,402 2,804,346 Brandon Spencer (7) n.a. n.a. Giampiero Frisio (7) n.a. n.a. Total 4,039,443 14,267,013 (1) Actual achievement level of the TSR measure was 200.0 percent. (2) Actual achievement level of the EPS measure was 200.0 percent. (3) Valued at CHF 26.39, the grant fair value of the ABB share on the grant date adjusted for expected foregone dividends during the vesting period. (4) The initial granted number of shares has been increased by 3.7 percent to reflect the impact of the Accelleron spin-off in 2022. (5) Valued at CHF 44.94, the closing price of the ABB share on the day of vesting. (6) Morten Wierod's 2021 LTIP grant related to his role as business area president Motion. (7) At the time of 2021 LTIP grant, Brandon Spencer and Giampiero Frisio were not members of the EC. ABB COMPENSATION REPORT 2024 33 LTIP vesting outcomes in the last five years The historical LTIP vesting outcomes for the prior five years are shown in Exhibit 34 below. Over the last five years vesting averaged 128.2 percent of target and 67.3 percent of the maximum award . Exhibit 34: LTIP historical actual vesting percentages (1) (1) According to plan-specific relative weighting of relevant performance measures. REALIZED TOTAL COMPENSATION – 2024 We disclose the realized total compensation for each EC member. Such transparency on realized compensation is designed to aid stakeholders’ understanding of ABB's link between pay and performance. Realized compensation relates to the AIP award and the LTIP award at the end of their respective performance cycles, reflecting the actual payment and settlement, based on achievements of the plan specific performance measures. Exhibit 35 sets out a high-level comparison of realized and target total compensation for each EC member. The compensation for Morten Wierod includes his former role as business area president Electrification (until July 31, 2024). We provide further details in Exhibit 49 in the section “Compensation tables and share ownership tables“ of this Report. Exhibit 35: Realized 2024 total compensation (in CHF) compared to target total compensation 73.0% 57.4% 121.0% 189.5% 200.0% 48.7% 32.8% 60.5% 94.8% 100.0% 0% 50% 100% 150% 200% 2017 LTIP 2018 LTIP 2019 LTIP 2020 LTIP 2021 LTIP Vesting in % of target award Vesting in % of maximum potential award 156% 163% 161% 110% 109% 146% 163% 115% 115% 0 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 Morten Wierod Timo Ihamuotila Carolina Granat Mathias Gärtner Karin Lepasoon Sami Atiya Peter Terwiesch Brandon Spencer Giampiero Frisio Target total compensation Realized total compensation 34 ABB COMPENSATION REPORT 2024 ANNUAL TOTAL COMPENSATION RATIO As in our Compensation Report 2023, we continue to provide our shareholders an additional level of pay transparency with the disclosure of the ratio of the annual total compensation for the organization’s highest- paid individual (our CEO) to the median annual total compensation of our employees in Switzerland (excluding the highest-paid individual). We consider Switzerland to be the most relevant location for analyzing the annual total compensation ratio since our CEO is also located and paid in Switzerland. This mitigates employee footprint and currency volatility. At the time of publication of this Report, the allocation of annual short-term incentive awards to eligible employees in Switzerland for 2024 has not been concluded. We therefore report the ratio for the year 2023, for which the relevant short-term incentive awards are known. At December 31, 2023, our CEO was Björn Rosengren. Our analysis includes full-time and part-time employees if they were employed at December 31, 2023. We extrapolate values of compensation elements of part-time employees and new hires during the year 2023 to represent full-time equivalent and full-year equivalent values. In accordance with the national practice in Switzerland related to equal pay analysis, our compensation ratio calculation includes trainees, but excludes other temporary employment types such as interns, apprentices and international assignees (expats, inpats, short-term assignees), as well as contingent workers. The calculated ratio comprises paid base salary, paid short-term incentive, granted long-term incentive, paid pension benefits and other paid benefits as compensation elements. The short-term incentive represents the bonus for the year 2023 (paid in March 2024). The long-term incentive represents the grant fair value, in line with the disclosure for the 2023 CEO compensation (see Exhibit 43 in this Report). Our CEO’s total compensation for 2023 was CHF 9,693,219. Values of long-term incentive, pension benefits and other benefits are considered for the employee with the median total cash compensation, comprising base salary and short-term incentive. The median 2023 total compensation for employees in Switzerland (excluding the CEO) was CHF 151,538. The resulting ratio is 64.0 (2022: 50.1). The ratio slightly widened due to the higher level of the CEO’s total compensation (2023: 20% more than 2022) and the lower level of the median employee total compensation (2023: 6% less than 2022). If the CEO’s annual total compensation was instead compared to the average annual total compensation of employees in Switzerland (excluding the CEO) the resulting ratio would be 51.8 (2022: 45.5). * Our analysis initially considers the sum of total cash compensation for all employees in scope. After we identified the employee with the median total cash compensation, the values of long-term incentive (if applicable), pension benefits and other benefits are added for the identified employee. OTHER COMPENSATION – 2024 Members of the EC are eligible to participate in the Employee Share Acquisition Plan (ESAP), a savings plan based on stock options, which is open to our employees around the world. Three members of the EC participated in the 21 st annual ESAP launch of the plan in 2024. EC members who participated will, upon vesting, each be entitled to acquire up to 210 ABB shares at CHF 48.41 per share, the market share price at the start of the 2024 plan. For a more detailed description of the ESAP, please refer to “Note 18 – Share ‑ based payment arrangements” in our Financial Report 2024. In 2024, ABB did not pay any fees or compensation to the members of the EC for services rendered to ABB other than those disclosed in this Report. Except as disclosed in the section “Executive Committee – Business relationships between ABB and its EC members” in our Corporate Governance Report 2024, the Company did not pay any additional fees or compensation in 2024 to persons closely linked to a member of the EC for services rendered to ABB. SHARE OWNERSHIP OF EC MEMBERS Four out of nine EC members have met and exceeded their share ownership requirement. The other five members have been appointed to the EC in the last three years. The individual shareholding in comparison to the relevant share ownership requirement is shown in Exhibit 9 in the section “At a glance”. ABB COMPENSATION REPORT 2024 35 The EC members collectively owned less than one percent of ABB’s total shares outstanding at December 31, 2024. At December 31, 2024, EC members held ABB shares and conditional rights to receive shares, as shown in Exhibit 47 in the section “Compensation tables and share ownership tables”. Their holdings at December 31, 2023, are shown in Exhibit 48 in the same section. Except as described in Exhibits 47 and 48, no member of the EC and no person closely linked to a member of the EC held any shares of ABB or options on ABB shares at December 31, 2024 and 2023. EXTERNAL BOARD MANDATES HELD BY EC MEMBERS Three out of nine EC members held at least one external mandate in other companies. We disclose detailed information in Exhibit 44 in the section “Compensation tables and share ownership tables”. 36 ABB COMPENSATION REPORT 2024 — CHANGES APPLICABLE TO EC MEMBERS TERMS OF APPOINTMENT FOR EC MEMBERS As a result of his promotion to the Chief Executive Officer effective from August 1, 2024, Morten Wierod’s annual base salary was increased from CHF 990,000 to CHF 1,500,000 and his target short-term and long-term incentive were adjusted in accordance with his new position, with a target short-term and target long-term incentive of 100 and 150 percent of annual base salary, respectively. Morten Wierod is eligible for standard EC benefits applicable to Switzerland. The new business area president Motion, Brandon Spencer, was appointed to the EC effective from August 1, 2024, with an annual base salary of USD 770,000, and a target short-term and target long-term incentive of 100 and 150 percent of annual base salary, respectively. Brandon Spencer is eligible for standard EC benefits and, where relevant, local US benefits. The new business area president Electrification, Giampiero Frisio, was appointed to the EC effective from August 1, 2024, with an annual base salary of EUR 805,000, and a target short-term and target long-term incentive of 100 and 150 percent of annual base salary, respectively. Giampiero Frisio is eligible for standard EC benefits and, where relevant, local Italian benefits. The new General Counsel and Company Secretary, Mathias Gärtner, was appointed to the EC effective from November 1, 2024, with an annual base salary of CHF 800,000, and a target short-term incentive and target long- term incentive of 100 and 150 percent of annual base salary, respectively. Mathias Gärtner is eligible for standard EC benefits applicable to Switzerland. He received a replacement share grant to compensate for his forgone equity grants with his previous employer. The value of forfeited performance share units and options grants was replaced with an ABB performance share unit grant and the value of forfeited restricted share unit grants was replaced with an ABB restricted share unit grant. TERMS OF DEPARTURE FOR EC MEMBERS The former Chief Executive Officer, Björn Rosengren, stepped down from the EC as per July 31, 2024, and retired as of December 31, 2024. He received compensation and benefits up to the point of his departure, including eligibility to a short-term incentive payment for 2024. His unvested shares granted under our LTIP will be treated according to contractual terms. The former business area president Motion, Tarak Metha, stepped down from the EC as per July 31, 2024, and departed from ABB on August 31, 2024. He received compensation and benefits up to the point of his departure. This included a contractually agreed pro-rata short-term incentive payment of CHF 910,780 for the period January 1 to August 31, 2024. His unvested shares granted under our LTIP will be treated according to contractual terms. The former General Counsel and Company Secretary, Andrea Antonelli, stepped down from the EC as per May 31, 2023, and departed from ABB on June 30, 2024, reflecting his contractual notice period of 12 months plus extension of such period by one month due to illness. He received compensation and benefits up to the point of his departure. This included a contractually agreed pro-rata short-term incentive payment of CHF 283,300 for the period January 1 to June 30, 2024. His unvested shares granted under our LTIP will be treated according to contractual terms. COMPENSATION OF FORMER EC MEMBERS In 2024, we did not make any payment to former EC members other than those disclosed in this Report. ABB COMPENSATION REPORT 2024 37 — VOTES ON COMPENSATION AT THE AGM 2025 As illustrated in Exhibit 36, the Board’s proposals to shareholders at the AGM 2025 will relate to Board compensation for the 2025–2026 term of office and EC compensation for the calendar year 2026. There will also be a non-binding consultative vote on the Compensation Report 2024, i.e., this Report. Exhibit 36: Shareholders will have three separate votes on compensation at the AGM 2025 The voting results at ABB’s AGM in 2024 were as follows: • Maximum aggregate Board compensation for the 2024–2025 term of office – 98.60 percent approved • Maximum aggregate EC compensation for 2025 – 93.58 percent approved • Consultative vote on the Compensation Report 2023 – 90.48 percent voted for In determining the proposed maximum aggregate EC compensation for 2026, the Board intends to take into consideration the criteria set forth in Exhibit 37. Given the variable nature of a major portion of the compensation components, the proposed maximum aggregate EC compensation will accordingly be higher than the actual compensation paid or awarded, as it must cover the potential maximum value of each component of compensation. 38 ABB COMPENSATION REPORT 2024 The decrease in maximum aggregate EC compensation for 2026 compared to 2025 is mainly influenced by the application of the adjusted, more performance-oriented compensation mix for EC entrants and the anticipated costs related to the vesting of 2023 LTIP awards. Exhibit 37: Overview of key factors affecting the determination of maximum aggregate EC compensation ABB COMPENSATION REPORT 2024 39 — COMPENSATION TABLES AND SHARE OWNERSHIP TABLES Exhibit 38: Board compensation in 2024 and 2023 (audited) Paid in 2024 Paid in 2023 November Board term 2024–2025 May Board term 2023–2024 Total compensation paid in 2024 (3) November Board term 2023–2024 May Board term 2022–2023 Total compensation paid in 2023 (3) Name Settled in cash (1) Settled in shares – number of shares received (2) Settled in cash (1) Settled in shares – number of shares received (2) Settled in cash (1) Settled in shares – number of shares received (2) Settled in cash (1) Settled in shares – number of shares received (2) CHF CHF CHF CHF CHF CHF Peter Voser, Chairman (4) — 12,022 — 13,754 1,200,000 — 17,462 — 18,607 1,200,000 Jacob Wallenberg (5) — — 112,500 1,859 225,000 112,500 2,624 112,500 2,796 450,000 Gunnar Brock (6) — — 165,000 — 165,000 82,500 1,924 82,500 2,048 330,000 David Constable (7) 80,000 1,283 80,000 1,468 320,000 80,000 1,866 80,000 1,988 320,000 Frederico Curado (8) — 2,666 — 3,058 350,000 — 3,876 — 4,130 350,000 Lars Förberg (9) — 3,183 — 3,649 320,000 — 4,628 — 4,945 320,000 Johan Forssell (10) 80,000 1,283 — — 160,000 — — — — — Denise Johnson (11) — 2,702 — 3,092 330,000 — 3,929 — — 165,000 Jennifer Xin-Zhe Li (12) — 2,666 87,500 1,490 350,000 87,500 1,890 87,500 2,018 350,000 Geraldine Matchett (13) 82,500 1,634 82,500 1,873 330,000 82,500 2,376 82,500 2,683 330,000 David Meline (14) 100,000 1,604 100,000 1,835 400,000 100,000 2,332 100,000 2,485 400,000 Satish Pai (15) — — — — — — — — 3,341 165,000 Mats Rahmström (16) 82,500 1,323 — — 165,000 — — — — — Total 425,000 30,366 627,500 32,078 4,315,000 545,000 42,907 545,000 45,041 4,380,000 (1) Represents gross amount paid, prior to deductions for social security, withholding tax, etc. (2) Number of shares per Board member is calculated based on net amount due after deductions for social security, withholding tax, etc. (3) In addition to the Board remuneration stated in the above table, in 2024 and 2023 the Company paid CHF 282,230 and CHF 235,498, respectively, in related mandatory social security payments. (4) Chairman of the ABB Ltd Board and of the Governance and Nomination Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; is receiving 100 percent of his compensation in the form of ABB shares. (5) Vice-Chairman of the ABB Ltd Board and member of the Governance and Nomination Committee for the 2022–2023 and 2023–2024 Board terms; received 50 percent of his compensation in the form of ABB shares. Did not stand for re-election in 2024. (6) Member of the Finance, Audit and Compliance Committee for the 2022–2023 and 2023–2024 Board terms; received 50 percent of his compensation in the form of ABB shares, except for his final compensation payment which was delivered after he stepped down from the Board and which he received 100 percent in cash. Did not stand for re-election in 2024. (7) Member of the Compensation Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; is receiving 50 percent of his compensation in the form of ABB shares. (8) Chairman of the Compensation Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; is receiving 100 percent of his compensation in the form of ABB shares. (9) Member of the Governance and Nomination Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; is receiving 100 percent of his compensation in the form of ABB shares. (10) Member of the Governance and Nomination Committee for the 2024–2025 Board term; is receiving 50 percent of his compensation in the form of ABB shares. (11) Member of the Finance, Audit and Compliance Committee for the 2023–2024 and 2024–2025 Board terms; is receiving 100 percent of her compensation in the form of ABB shares. (12) Member of the Compensation Committee and of the Governance and Nomination Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; received 50 percent of her compensation in the form of ABB shares for the 2022–2023 and 2023–2024 Board terms and is receiving 100 percent of her compensation in the form of ABB shares for the 2024–2025 Board term. (13) Member of the Finance, Audit and Compliance Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; is receiving 50 percent of her compensation in the form of ABB shares. (14) Chairman of the Finance, Audit and Compliance Committee for the 2022–2023, 2023–2024 and 2024–2025 Board terms; is receiving 50 percent of his compensation in the form of ABB shares. (15) Member of the Finance, Audit and Compliance Committee for the 2022–2023 Board term; received 100 percent of his compensation in the form of ABB shares. Did not stand for re-election in 2023. (16) Member of the Finance, Audit and Compliance Committee for the 2024–2025 Board term; is receiving 50 percent of his compensation in the form of ABB shares. 40 ABB COMPENSATION REPORT 2024 Exhibit 39: Board compensation for the Board terms 2024–2025 and 2023–2024 (audited) Board term 2024–2025 Board term 2023–2024 Name Specific Board roles CHF CHF Peter Voser Chairman of the Board and Chairman GNC for 2024–2025 and 2023–2024 terms 1,200,000 1,200,000 Jacob Wallenberg Vice-Chairman of the Board and Member GNC for 2023–2024 term — 450,000 Gunnar Brock Member FACC for 2023–2024 term — 330,000 David Constable Member CC for 2024–2025 and 2023–2024 terms 320,000 320,000 Frederico Curado Chairman CC for 2024–2025 and 2023–2024 terms 350,000 350,000 Lars Förberg Member GNC for 2024–2025 and 2023–2024 terms 320,000 320,000 Johan Forssell Member GNC for 2024–2025 term 320,000 — Denise Johnson Member FACC for 2024–2025 and 2023–2024 terms 330,000 330,000 Jennifer Xin-Zhe Li Member CC and Member GNC for 2024–2025 and 2023–2024 terms 350,000 350,000 Geraldine Matchett Member FACC for 2024–2025 and 2023–2024 terms 330,000 330,000 David Meline Chairman FACC for 2024–2025 and 2023–2024 terms 400,000 400,000 Mats Rahmström Member FACC for 2024–2025 term 330,000 — Total 4,250,000 4,380,000 Key: CC: Compensation Committee FACC: Finance, Audit and Compliance Committee GNC: Governance and Nomination Committee Exhibit 40: Board ownership of ABB shares (audited) Total number of shares held Name December 31, 2024 December 31, 2023 Peter Voser 206,652 215,876 Jacob Wallenberg — 251,318 Gunnar Brock — 41,785 David Constable 49,070 46,319 Frederico Curado 62,905 57,181 Lars Förberg 86,927 80,095 Johan Forssell 1,283 — Denise Johnson 9,723 3,929 Jennifer Xin-Zhe Li 49,968 45,812 Geraldine Matchett 39,530 36,023 David Meline (1) 51,387 47,948 Mats Rahmström (2) 4,858 — Total 562,303 826,286 (1) Includes 3,150 shares held by spouse. (2) Includes 735 shares held by family members. ABB COMPENSATION REPORT 2024 41 Exhibit 41: Board members with external mandates at December 31, 2024 (audited) Name Company Listed company 2024 new mandate vs 2023 Mandate Peter Voser IBM Corporation, Armonk, United States ● Member of the Board of Directors Chairman of the Audit Committee Member of the Board’s Executive Committee Temasek Holdings (Private) Limited, Singapore, Singapore ● Member of the Board of Directors Chairman of the Risk & Sustainability Committee Member of the Leadership & Compensation Committee PSA International Pte Ltd, Singapore, Singapore Group Chairman of the Board David Constable Fluor Corporation, Irving, United States ● ● Chief Executive Officer Chairman of the Board of Directors Chairman of the Board’s Executive Committee Frederico Curado Transocean Ltd., Zug, Switzerland ● Member of the Board of Directors Chairman of the Governance, Safety and Environment Committee LATAM Airlines Group, Santiago, Chile ● ● ● Member of the Board of Directors Chairman of the Audit Committee Chairman of the Strategy Committee Member of the Compensation Committee Lars Förberg Cevian Capital AB, Stockholm, Sweden Co-founder and Managing Partner Johan Forssell Atlas Copco AB, Nacka, Sweden ● Member of the Board of Directors Member of the Audit Committee Wärtsilä Oyj Abp, Helsinki, Finland ● Member of the Board of Directors Epiroc AB, Stockholm, Sweden ● Member of the Board of Directors Member of the Remuneration Committee Denise Johnson Caterpillar Inc., Deerfield, United States ● Group President, Resource Industries Jennifer Xin-Zhe Li Changcheng Investment Partners, Beijing, China Founder and General Partner SAP SE, Walldorf, Germany ● Member of the Board of Directors Chairwoman of the Audit and Compliance Committee Member of the Finance and Investment Committee Full Truck Alliance Co. Ltd., Guizhou / Nanjing, China ● Member of the Board of Directors Chairwoman of the Audit Committee Geraldine Matchett Nestlé Ltd., Vevey, Switzerland ● ● ● ● Member of the Board of Directors Member of the Governance, Nomination and Sustainability Committee Member of the Risk Committee Swiss Re Ltd, Zurich, Switzerland ● ● ● Member of the Board of Directors Member of the Audit Committee David Meline HP Inc., Palo Alto, United States ● Member of the Board of Directors Member of the Audit Committee Member of the Finance, Investment and Technology Committee Pacific Biosciences of California Inc., Menlo Park, United States ● Member of the Board of Directors Member of the Audit Committee Mats Rahmström Piab Group AB, Danderyd, Sweden Chairman of the Board of Directors Investor AB, Stockholm, Sweden ● Member of the Board of Directors Wärtsilä Oyj Abp, Helsinki, Finland ● Member of the Board of Directors Qvantum Industries AB, Astorp, Sweden Member of the Board of Directors SMD Logistics AB, Stockholm, Sweden Member of the Board of Directors 42 ABB COMPENSATION REPORT 2024 Exhibit 42: EC compensation in 2024 (audited) Cash Compensation Estimated value of share- based grants under the LTIP in 2024 (4) Estimated value of replacement share-based grant in 2024 (5) 2024 Total compensation (incl. conditional share- based grants) Name Base salary Short-term incentive (1) Pension benefits Other benefits (2) 2024 Total cash-based compensation (3) CHF CHF CHF CHF CHF CHF CHF CHF Morten Wierod (CEO as of August 1, 2024) 1,193,754 1,518,775 404,221 673,195 3,789,945 2,829,060 — 6,619,005 Timo Ihamuotila 990,004 1,234,530 531,616 831,765 3,587,915 1,154,192 — 4,742,107 Carolina Granat 725,012 892,475 434,077 589,626 2,641,190 845,235 — 3,486,425 Mathias Gärtner (EC member as of November 1, 2024) 133,335 164,134 28,714 27,952 354,135 1,586,900 3,573,566 5,514,601 Karin Lepasoon 600,000 738,600 255,540 140,638 1,734,778 699,506 — 2,434,284 Sami Atiya 800,009 459,200 491,512 647,603 2,398,324 932,690 — 3,331,014 Peter Terwiesch 860,004 1,159,280 498,421 685,234 3,202,939 1,002,644 — 4,205,583 Brandon Spencer (EC member as of August 1, 2024) (6)(7) 278,387 367,750 — 40,780 686,917 1,261,951 — 1,948,868 Giampiero Frisio (EC member as of August 1, 2024) (7) 314,956 423,302 32,343 48,570 819,171 1,430,528 — 2,249,699 Total Executive Committee members at December 31, 2024 5,895,461 6,958,046 2,676,444 3,685,363 19,215,314 11,742,706 3,573,566 34,531,586 Björn Rosengren (EC member until July 31, 2024) (8) 1,785,006 2,154,495 753,339 1,759,261 6,452,101 — — 6,452,101 Andrea Antonelli (EC member until May 31, 2023) (8) 350,000 283,300 121,566 155,889 910,755 — — 910,755 Tarak Mehta (EC member until July 31, 2024) (8) 620,006 910,780 344,357 745,329 2,620,472 — — 2,620,472 Total departing Executive Committee members 2,755,012 3,348,575 1,219,262 2,660,479 9,983,328 — — 9,983,328 Total 8,650,473 10,306,621 3,895,706 6,345,842 29,198,642 11,742,706 3,573,566 44,514,914 (1) Represents accrued short-term variable compensation for the year 2024, which will be paid in 2025, after the publication of ABB's financial results. Short-term variable compensation is linked to the targets and goals defined in each EC member's Annual Incentive Plan. Upon full achievement of these targets and goals, the short-term variable compensation of the EC members represents 100 percent of their respective base salary. Andrea Antonelli and Tarak Mehta received a short-term variable compensation payment in 2024 at the time of their departure related to their termination period, in accordance with the contractual obligations of ABB. (2) Other benefits mainly comprise payments related to social security, health insurance, transportation, tax advice and certain other items. (3) Prepared on an accrual basis. (4) The estimated value of the share-based LTIP grants is based on the price of ABB shares on the grant date. On the day of vesting (April 24, 2027), the value of the share- based awards granted under the LTIP may vary from the above amounts due to changes in ABB's share price and the outcome of the performance factors. (5) The estimated value of the share-based replacement grant is based on the closing price of ABB shares on the grant date. On the vesting dates (November 1, 2025, 2026 and 2027), the value of the share-based awards granted under the replacement share grant may vary from the above amounts due to changes in ABB's share price and the outcome of the performance factors. (6) For Brandon Spencer the maximum pension contributions for the year 2024 were already reached prior to his promotion to the EC. Therefore no additional pension contributions were provided in 2024. (7) Compensation of Brandon Spencer was converted from USD to CHF applying an average foreign exchange rate of 0.8677, and compensation of Giampiero Frisio was converted from EUR to CHF applying an average foreign exchange rate of 0.9390. (8) EC members who stepped down from the EC during 2024 coninued to receive compensation and benefits up to the point of their departure, according to contractual terms, which are included in their total compensation. ABB COMPENSATION REPORT 2024 43 Exhibit 43: EC compensation in 2023 (audited) Cash Compensation Estimated value of share- based grants under the LTIP in 2022 (4) 2023 Total compensation (incl. conditional share- based grants) (5) Name Base salary Short-term incentive (1) Pension benefits Other benefits (2) 2023 Total cash-based compensation (3) CHF CHF CHF CHF CHF CHF CHF Björn Rosengren 1,785,006 2,659,650 775,090 1,759,098 6,978,844 2,714,375 9,693,219 Timo Ihamuotila 990,004 1,386,000 541,130 786,869 3,704,003 1,003,656 4,707,659 Carolina Granat 725,012 1,087,500 440,166 369,285 2,621,963 734,999 3,356,962 Karin Lepasoon 600,000 900,000 254,677 162,089 1,916,766 608,288 2,525,054 Sami Atiya 800,009 960,000 499,122 654,700 2,913,831 811,038 3,724,869 Tarak Mehta 930,009 1,395,000 526,130 746,993 3,598,132 942,817 4,540,949 Peter Terwiesch 855,003 1,179,060 505,595 657,565 3,197,223 871,844 4,069,067 Morten Wierod 962,502 1,462,500 505,842 685,145 3,615,989 988,423 4,604,412 Total Executive Committee members at December 31, 2023 7,647,545 11,029,710 4,047,752 5,821,744 28,546,751 8,675,440 37,222,191 Andrea Antonelli (EC member until May 31, 2023) 700,000 980,000 248,685 140,430 2,069,115 1,064,462 3,133,577 Theodor Swedjemark (EC member until September 30, 2022) 83,334 78,854 45,344 79,168 286,700 — 286,700 Total departing Executive Committee members 783,334 1,058,854 294,029 219,598 2,355,815 1,064,462 3,420,277 Total 8,430,879 12,088,564 4,341,781 6,041,342 30,902,566 9,739,902 40,642,468 (1) Represents accrued short-term variable compensation for the year 2023, which was paid in 2024, after the publication of ABB's financial results. Short- term variable compensation is linked to the targets and goals defined in each EC member's Annual Incentive Plan. Upon full achievement of these targets and goals, the short-term variable compensation of the EC member represents 100 percent of their respective base salary. Theodor Swedjemark received a short-term variable compensation payment in February 2023 related to his termination period, in accordance with the contractual obligations of ABB. (2) Other benefits mainly comprise payments related to social security, health insurance, children's education, transportation, tax advice, compensation for foregone dividends on replacement share grants and certain other items. (3) Prepared on an accrual basis. (4) The estimated value of the share-based LTIP grants is based on the price of ABB shares on the grant date. On the day of vesting (April 24, 2026), the value of the share-based awards granted under the LTIP may vary from the above amounts due to changes in ABB's share price and the outcome of the performance factors. (5) Payments totaling CHF 308,592 were made in 2023 on behalf of certain other former EC members, representing social security premium payments due on the 2020 LTIP vesting and tax advisory services for the period when they have been active EC members. Exhibit 44: EC members with external mandates at December 31, 2024 (audited) Name Company Listed company 2024 new mandate vs 2023 Mandate Timo Ihamuotila Kone Oy, Espoo, Finland ● Member of the Board of Directors Member of the Audit Committee Oras Invest Oy, Helsinki, Finland Member of the Board of Directors Sami Atiya SGS SA, Geneva, Switzerland ● Member of the Board of Directors Chairman of the Remuneration Committee Member of the Nomination Committee Peter Terwiesch Hilti AG, Schaan, Liechtenstein Member of the Board of Directors 44 ABB COMPENSATION REPORT 2024 Exhibit 45: LTIP grants in 2024 (audited) Name Reference number of shares under the EPS performance factor of the 2024 launch of the LTIP (1) Total estimated value of share-based grants under the EPS performance factor of the 2024 launch of the LTIP (2)(3) Reference number of shares under the TSR performance factor of the 2024 launch of the LTIP (1) Total estimated value of share-based grants under the TSR performance factor of the 2024 launch of the LTIP (2)(3) Reference number of shares under the sustainability performance factor of the 2024 launch of the LTIP (1) Total estimated value of share-based grants under the sustainability performance factor of the 2024 launch of the LTIP (2)(3) Total number of reference shares granted under the 2024 launch of the LTIP (1)(2) Total estimated value of share-based grants under the LTIP in 2024 (2)(3) CHF CHF CHF CHF Morten Wierod (4) 29,754 1,414,506 17,852 848,685 11,903 565,869 59,509 2,829,060 Timo Ihamuotila 13,092 577,096 7,855 346,249 5,237 230,847 26,184 1,154,192 Carolina Granat 9,587 422,595 5,752 253,549 3,836 169,091 19,175 845,235 Mathias Gärtner (EC member as of November 1, 2024) 15,869 793,450 9,521 476,050 6,348 317,400 31,738 1,586,900 Karin Lepasoon (4) 7,934 349,731 4,760 209,821 3,175 139,954 15,869 699,506 Sami Atiya 10,579 466,323 6,347 279,776 4,233 186,591 21,159 932,690 Peter Terwiesch (4) 11,373 501,322 6,823 300,758 4,550 200,564 22,746 1,002,644 Brandon Spencer (EC member as of August 1, 2024) 13,272 630,951 7,963 378,562 5,310 252,438 26,545 1,261,951 Giampiero Frisio (EC member as of August 1, 2024) 15,045 715,240 9,027 429,144 6,019 286,144 30,091 1,430,528 Total Executive Committee members at December 31, 2024 126,505 5,871,214 75,900 3,522,594 50,611 2,348,898 253,016 11,742,706 (1) Vesting date April 22, 2027. (2) The reference number of shares of the EPS, TSR and sustainability performance factors are valued using the fair value of the ABB shares on the grant date. (3) Default settlement of the final LTIP award is 100 percent in shares, with an automatic sell-to-cover in place for employees who are subject to withholding taxes. The plan foresees a maximum award of 200 percent of the number of reference shares granted based on the achievement against the predefined average EPS, relative TSR and sustainability performance targets. Participants are also entitled to receive a dividend equivalent payment at the time of vesting for each awarded share. (4) In addition to the above awards, three members of the EC participated in the 21 st launch of the ESAP in 2024, which will allow them to save over a 12-month period and, in November 2025, use their savings to acquire ABB shares under the ESAP. Each EC member who participated in ESAP will, upon vesting, be entitled to acquire up to 210 ABB shares at an exercise price of CHF 48.41 per share. ABB COMPENSATION REPORT 2024 45 Exhibit 46: LTIP grants in 2023 (audited) Name Reference number of shares under the EPS performance factor of the 2023 launch of the LTIP (1) Total estimated value of share-based grants under the EPS performance factor of the 2023 launch of the LTIP (2)(3) Reference number of shares under the TSR performance factor of the 2023 launch of the LTIP (1) Total estimated value of share-based grants under the TSR performance factor of the 2023 launch of the LTIP (2)(3) Reference number of shares under the sustainability performance factor of the 2023 launch of the LTIP (1) Total estimated value of share-based grants under the sustainability performance factor of the 2023 launch of the LTIP (2)(3) Total number of reference shares granted under the 2023 launch of the LTIP (1)(2) Total estimated value of share-based grants under the LTIP in 2023 (2)(3) CHF CHF CHF CHF Björn Rosengren (4) 42,854 1,357,187 25,712 814,300 17,142 542,888 85,708 2,714,375 Timo Ihamuotila 15,845 501,812 9,507 301,087 6,339 200,757 31,691 1,003,656 Carolina Granat 11,604 367,499 6,962 220,487 4,642 147,013 23,208 734,999 Karin Lepasoon (4) 9,603 304,128 5,762 182,483 3,842 121,677 19,207 608,288 Sami Atiya 12,804 405,503 7,682 243,289 5,123 162,246 25,609 811,038 Tarak Mehta (4) 14,885 471,408 8,931 282,845 5,954 188,564 29,770 942,817 Peter Terwiesch (4) 13,764 435,906 8,258 261,531 5,507 174,407 27,529 871,844 Morten Wierod (4) 15,605 494,211 9,363 296,527 6,242 197,685 31,210 988,423 Total Executive Committee members at December 31, 2023 136,964 4,337,654 82,177 2,602,549 54,791 1,735,237 273,932 8,675,440 (1) Vesting date April 24, 2026. (2) The reference number of shares of the EPS, TSR and sustainability performance factors are valued using the fair value of the ABB shares on the grant date. (3) Default settlement of the final LTIP award is 100 percent in shares, with an automatic sell-to-cover in place for employees who are subject to withholding taxes. The plan foresees a maximum award of 200 percent of the number of reference shares granted based on the achievement against the predefined average EPS, relative TSR and sustainability performance targets. Participants are also entitled to receive a dividend equivalent payment at the time of vesting for each awarded share. (4) In addition to the above awards, five members of the EC participated in the 20 th launch of the ESAP in 2023, which allowed them to save over a 12-month period and, in November 2024, use their savings to acquire ABB shares under the ESAP. Each EC member who participated in ESAP was, upon vesting, entitled to acquire up to 330 ABB shares at an exercise price of CHF 30.49 per share. 46 ABB COMPENSATION REPORT 2024 Exhibit 47: EC shareholding overview at December 31, 2024 (audited) Unvested at December 31, 2024 Name Total number of shares held at December 31, 2024 Reference number of shares under the 2022 performance factors (EPS, TSR and sustainability) of the LTIP (1) Reference number of shares under the 2023 performance factors (EPS, TSR and sustainability) of the LTIP (1) Reference number of shares under the 2024 performance factors (EPS, TSR and sustainability) of the LTIP (1) Replacement share grant for foregone benefits from former employer (2) Replacement share grant for foregone benefits from former employer (2) Replacement share grant for foregone benefits from former employer (2) (vesting 2025) (vesting 2026) (vesting 2027) (vesting 2025) (vesting 2026) (vesting 2027) Morten Wierod (CEO as of August 1, 2024) 170,999 28,736 31,210 59,509 — — — Timo Ihamuotila 200,000 31,609 31,691 26,184 — — — Carolina Granat (3) 38,018 23,148 23,208 19,175 — — — Mathias Gärtner (EC member as of November 1, 2024) — — — 31,738 6,275 33,057 34,002 Karin Lepasoon 690 19,157 19,207 15,869 — — — Sami Atiya 100,000 25,543 25,609 21,159 — — — Peter Terwiesch 100,330 26,501 27,529 22,746 — — — Brandon Spencer (EC member as of August 1, 2024) — 9,541 16,013 26,545 — — — Giampiero Frisio (EC member as of August 1, 2024) 1,381 14,404 21,249 30,091 — — — Total Executive Committee members at December 31, 2024 611,418 178,639 195,716 253,016 6,275 33,057 34,002 (1) The final 2022 LTIP, 2023 LTIP and 2024 LTIP awards will be settled 100 percent in shares, with an automatic sell-to-cover in place for employees who are subject to withholding taxes. (2) The first tranche of the replacement share grant consists of Restricted Share Units and will vest one year after the grant. The second and the third tranche of the replacement share grant consist of Performance Share Units and will vest two respectively three years after the grant. The vesting level of the Performance Share Units depends on the achievement of the applicable performance targets. The final replacement awards will be settled 100 percent in shares. Shares are entitled to receive dividend equivalent payment on the final number of vested shares. (3) This includes 1,200 shares held by spouse. ABB COMPENSATION REPORT 2024 47 Exhibit 48: EC shareholding overview at December 31, 2023 (audited) Unvested at December 31, 2023 Name Total number of shares held at December 31, 2023 Reference number of shares under the 2021 performance factors (EPS and TSR) of the LTIP (1) Reference number of shares under the 2022 performance factors (EPS, TSR and sustainability) of the LTIP (1) Reference number of shares under the 2023 performance factors (EPS, TSR and sustainability) of the LTIP (1) (vesting 2024) (vesting 2025) (vesting 2026) Björn Rosengren 262,334 99,450 85,487 85,708 Timo Ihamuotila 202,000 37,830 31,609 31,691 Carolina Granat (2) 5,200 27,301 23,148 23,208 Karin Lepasoon 360 — 19,157 19,207 Sami Atiya 100,000 31,201 25,543 25,609 Tarak Mehta 134,710 36,271 29,694 29,770 Peter Terwiesch 100,000 31,201 26,501 27,529 Morten Wierod 141,267 31,201 28,736 31,210 Total Executive Committee members at December 31, 2023 945,871 294,455 269,875 273,932 (1) The final 2021 LTIP, 2022 LTIP and 2023 LTIP awards will be settled 100 percent in shares, with an automatic sell-to-cover in place for employees who are subject to withholding taxes. (2) This includes 1,200 shares held by spouse. 48 ABB COMPENSATION REPORT 2024 Exhibit 49: Targeted and realized EC total compensation in 2024 Target compensation (in CHF) Base salary Pension benefits Other benefits (1) Target 2024 short-term incentive (2) Grant fair value of 2021 LTIP (3) Target total variable compensation Target total compensation Morten Wierod (4) 1,193,754 404,221 652,637 1,193,750 793,997 1,987,747 4,238,359 Timo Ihamuotila 990,004 531,616 816,298 990,000 962,708 1,952,708 4,290,626 Carolina Granat 725,012 434,077 579,033 725,000 694,744 1,419,744 3,157,866 Mathias Gärtner 133,335 28,714 26,004 133,334 n.a. 133,334 321,387 Karin Lepasoon 600,000 255,540 131,872 600,000 n.a. 600,000 1,587,412 Sami Atiya 800,009 491,512 669,159 800,000 793,997 1,593,997 3,554,677 Peter Terwiesch 860,004 498,421 666,305 860,000 793,997 1,653,997 3,678,727 Brandon Spencer (5) 278,387 — 40,780 278,387 n.a. 278,387 597,554 Giampiero Frisio 314,956 32,343 48,570 314,956 n.a. 314,956 710,825 Total 5,895,461 2,676,444 3,630,658 5,895,427 4,039,443 9,934,870 22,137,433 Realized compensation (in CHF) Base salary Pension benefits Other benefits (1)(6) Actual 2024 short-term incentive (7) Realized value of 2021 LTIP (8) Total variable compensation Total compensation Morten Wierod (4) 1,193,754 404,221 673,195 1,518,775 2,804,346 4,323,121 6,594,291 Timo Ihamuotila 990,004 531,616 831,765 1,234,530 3,400,161 4,634,691 6,988,076 Carolina Granat 725,012 434,077 589,626 892,475 2,453,814 3,346,289 5,095,004 Mathias Gärtner 133,335 28,714 27,952 164,134 n.a. 164,134 354,135 Karin Lepasoon 600,000 255,540 140,638 738,600 n.a. 738,600 1,734,778 Sami Atiya 800,009 491,512 647,603 459,200 2,804,346 3,263,546 5,202,670 Peter Terwiesch 860,004 498,421 685,234 1,159,280 2,804,346 3,963,626 6,007,285 Brandon Spencer (5) 278,387 — 40,780 367,750 n.a. 367,750 686,917 Giampiero Frisio 314,956 32,343 48,570 423,302 n.a. 423,302 819,171 Total 5,895,461 2,676,444 3,685,363 6,958,046 14,267,013 21,225,059 33,482,327 Achievement levels (in %) (9) Base salary Pension benefits Other benefits (1) 2024 short-term incentive (7) 2021 LTIP (8) Total variable compensation Total compensation Morten Wierod (4) 100.0% 100.0% 103.1% 127.2% 353.2% 217.5% 155.6% Timo Ihamuotila 100.0% 100.0% 101.9% 124.7% 353.2% 237.3% 162.9% Carolina Granat 100.0% 100.0% 101.8% 123.1% 353.2% 235.7% 161.3% Mathias Gärtner 100.0% 100.0% 107.5% 123.1% n.a. 123.1% 110.2% Karin Lepasoon 100.0% 100.0% 106.6% 123.1% n.a. 123.1% 109.3% Sami Atiya 100.0% 100.0% 96.8% 57.4% 353.2% 204.7% 146.4% Peter Terwiesch 100.0% 100.0% 102.8% 134.8% 353.2% 239.6% 163.3% Brandon Spencer (5) 100.0% n.a. 100.0% 132.1% n.a. 132.1% 115.0% Giampiero Frisio 100.0% 100.0% 100.0% 134.4% n.a. 134.4% 115.2% Average 100.0% 100.0% 102.3% 120.0% 353.2% 183.1% 137.7% (1) Other benefits comprise payments related to social security, health insurance, children's education, transportation, tax advice and certain other items. (2) Target short-term incentive corresponds to 100 percent of the latest applicable annual base salary. (3) Represents the 2021 LTIP grant date fair value as per April 26, 2021, as disclosed in our Annual Report 2021. (4) Information for Morten Wierod is based on his compensation related to his CEO role and his former role as business area president Electrification (until July 31, 2024), e.g., the achievement level of 127.2 percent represents his combined 2024 short-term incentive outcome related to the two roles held in 2024 (120.7 percent for his CEO role and 134.4 percent for his business area president role 134.4, as detailed in Exhibit 26) compared to his combined 2024 target short-term incentive. (5) For Brandon Spencer the maximum pension contributions for the year 2024 were already reached prior to his promotion to the EC. Therefore no additional pension contributions were provided in 2024. (6) Differences between realized and target values due to higher social security payments related to AIP awards above target values. (7) Represents accrued short-term incentive for the year 2024, which will be paid in 2025, after the publication of ABB's financial results. STI is linked to the targets and goals defined in each EC member's Annual Incentive Plan. (8) Valued at CHF 44.94, the closing price of the ABB share on the day of vesting. (9) Ratio of realized compensation compared to target compensation. 49 KPMG Report of the statutory auditor To the General Meeting of ABB Ltd, Zurich Report on the Audit of the Compensation Report Opinion We have audited the Compensation Report of ABB Ltd (the Company) for the year ended December 31, 2024. The audit was limited to the information pursuant to Art. 734a-734f of the Swiss Code of Obligations (CO) in the tables marked “audited” in the Compensation Report. In our opinion, the information pursuant to Art. 734a-734f CO in the accompanying Compensation Report complies with Swiss law and the Company’s articles of incorporation. Basis for Opinion We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH). Our responsibilities under those provisions and standards are further described in the “Auditor’s Responsibilities for the Audit of the Compensation Report’’ section of our report. We are independent of the Company in accordance with the provisions of Swiss law and the requirements of the Swiss audit profession, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other Information The Board of Directors is responsible for the other information. The other information comprises the information included in the ABB Annual Reporting Suite (consisting of the Integrated Report, the Financial Report, the Corporate Governance Report, the Compensation Report and the Sustainability Statement), but does not include the audited content of the Compensation Report, the consolidated financial statements, the statutory financial statements of ABB Ltd and our auditor’s reports thereon. Our opinion on the Compensation Report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the Compensation Report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the audited financial information in the Compensation Report or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. 50 Board of Directors' Responsibilities for the Compensation Report The Board of Directors is responsible for the preparation of a Compensation Report in accordance with the provisions of Swiss law and the Company’s articles of incorporation, and for such internal control as the Board of Directors determines is necessary to enable the preparation of a Compensation Report that is free from material misstatement, whether due to fraud or error. The Board of Directors is also responsible for designing the compensation system and defining individual compensation packages. Auditor’s Responsibilities for the Audit of the Compensation Report Our objectives are to obtain reasonable assurance about whether the information pursuant to Art. 734a-734f CO is free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law and SA-CH will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this Compensation Report. As part of an audit in accordance with Swiss law and SA-CH, we exercise professional judgement and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement in the Compensation Report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made. We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. 51 \Ne also provide the Board of Directors or its relevant committee with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. KPMG AG Achim Wolper Licensed Audit Expert Auditor in Charge Mohamad Midani Zurich, Switzerland February 26, 2025 2025 KPMG AG, a Swiss corporation, is a group company of KPMG Holding LLP, which is a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. rX-bRIsuissc zcrtiri’iorros Untsmchmon 52 Caution concerning forward-looking statements The Compensation Report 2024 includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We have based these forward-looking statements largely on current expectations, 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,” “continue,” “target,” “anticipate,” “intend,” “expect”, “plan” and similar words and the express or implied discussion of strategy, plans or intentions are intended to identify forward-looking statements. These forward- looking statements are subject to risks, uncertainties and assumptions, including among other things, the following: (i) business risks related to the global volatile economic environment; (ii) costs associated with compliance activities; (iii) difficulties encountered in operating in emerging markets; (iv) risks inherent in large, long term projects served by parts of our business; (v) the timely development of new products, technologies, and services that are useful for our customers; (vi) our ability to anticipate and react to technological change and evolving industry standards in the markets in which we operate; (vii) changes in interest rates and fluctuations in currency exchange rates; (viii) changes in raw materials prices or limitations of supplies of raw materials; (ix) the weakening or unavailability of our intellectual property rights; (x) industry consolidation resulting in more powerful competitors and fewer customers; (xi) effects of competition and changes in economic and market conditions in the product markets and geographic areas in which we operate; (xii) effects of, and changes in, laws, regulations, governmental policies, taxation, or accounting standards and practices and (xiii) other factors described in documents that we may furnish from time to time with the US Securities and Exchange Commission, including our Annual Reports on Form 20-F. 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-looking 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 forward-looking statements.