04 Chairman’s Letter

06 Summary of our corporate governance approach

07 Board of Directors

14 Executive Committee

17 Shares

20 Shareholders

23 Independent External Auditors

25 Other governance information

26 Information policy
4 ABB CORPORATE GOVERNANCE REPORT 2023

—
Chairman’s letter

Dear Shareholders,

We are living in turbulent times. Technology is scope 1 and 2 emissions from our own operations
moving forward in leaps and bounds, and by 80 percent, without carbon offsets, and to cut
challenges like climate change and geopolitical our scope 3 value-chain emissions by 25 percent.
instability are testing our societies as never By 2050, our goal is to have reached net zero in our
before. At ABB, we believe that technology holds own operations and to have reduced our scope 3
the key to addressing the climate challenge and to emissions by 90 percent. These targets are
building more stable, prosperous societies. In science-based and have been submitted to the
2023, we helped customers all over the world Science Based Targets initiative (SBTi) for
optimize, electrify and decarbonize their validation.
operations with our leading electrification and
automation solutions. This allowed us to increase We also introduced a new methodology for
our order backlog while delivering the best quantifying avoided emissions in our customers’
financial results in ABB’s history. operations, based on the latest guidance from the
World Business Council for Sustainable
Our strong performance – the result of a wide- Development (WBCSD). Our aim is to help our
ranging organizational transformation – gave us customers avoid 600 megatons of greenhouse gas
the confidence to raise our financial targets and emissions through the products we sell from 2022
update our Sustainability Agenda in line with the to 2030.
latest international standards. With our leading
technologies in electrification and automation, Beyond reducing emissions, our Sustainability
ABB is ideally placed to support the energy Agenda commits us to moving towards circular
transition and help our customers move to low- business models. By 2030, we aim to eliminate
carbon and circular business models. waste to landfill from our own operations and help
our customers meet their own circularity
Updated financial framework commitments by offering retrofit, take-back and
recycling services. Finally, to promote social
At our Capital Markets Day on November 30, we progress, we updated our Human Rights policy
announced a new financial framework for the years and strengthened human rights due diligence
ahead. Among the key targets, we increased ABB’s along our value chain in line with the United
comparable revenue growth target to 5–7 percent Nations’ Guiding Principles on Business and
through the economic cycle from 3–5 percent Human Rights.
previously, and raised our operational EBITA
margin target to 16–19 percent from ≥ 15 percent. Focusing our portfolio for profitable growth
We also sharpened our objective for basic EPS
growth through the economic cycle to at least high To ensure that ABB is well-positioned in profitable
single-digit. And we confirmed ABB’s target of growth markets that support our purpose, we
~100 percent free cash flow conversion to net actively manage our portfolio by encouraging our
income. Our policy of paying a rising, sustainable divisions to seek out acquisitions to drive growth.
dividend per share over time remains in place. In the past three years, we have acquired several
small companies and we aim to make at least five
Sustainability Agenda small to mid-sized acquisitions per year in line with
our goal of being number 1 or 2 in all market
To support our purpose of enabling a more segments in which we are present.
sustainable and resource-efficient future, we
announced new net-zero-aligned targets at our
Capital Markets Day. By 2030, we aim to reduce
ABB CORPORATE GOVERNANCE REPORT 2023 5

By the same token, divisions that no longer fit our excellent. The internal assessments are
purpose or would perform better under different complemented periodically by external reviews,
ownership are either restructured or earmarked the next of which is foreseen for 2024.
for exit. In the past three years, we have sold two
high-performing businesses and spun off our At our annual general meeting in March, we will be
successful, global market-leading turbocharging proposing two new Board members for election,
division, Accelleron. Johan Forssell and Mats Rahmström. They will
replace Jacob Wallenberg and Gunnar Brock who
Last year, we also streamlined our stock exchange have decided not to stand for re-election. Jacob
listings by delisting ABB securities from the New Wallenberg has been Vice-Chairman of the Board
York Stock Exchange (NYSE). ABB’s shares are still of Directors since 2015 and a non-executive
listed on the SIX Swiss Exchange and Nasdaq member since 1999. He is a member of the
Stockholm, which reflects our Swiss and Swedish Governance and Nomination Committee. Gunnar
heritage, and are widely traded on electronic Brock joined ABB’s Board in 2018 and is a member
trading platforms. The delisting from the NYSE of the Finance, Audit and Compliance Committee. I
had no impact on our business or operations in the would like to thank Jacob for his significant
United States, which is our largest market. contribution to ABB’s success over the past almost
25 years. I also want to thank Gunnar for the
Committed to ethical business practices important role he has played on our Board over the
past six years.
Underpinning everything we do is our commitment
to embedding a culture of integrity and Johan Forssell is currently President and CEO of
transparency throughout our value chain. In 2023, Investor. He will step down from his current
we updated our ABB Code of Conduct and our position as of May 2024. He also serves on the
Supplier Code of Conduct as well as our Human boards of Atlas Copco, Epiroc, Wärtsilä and EQT.
Rights policy, which reflects our commitment to Mats Rahmström is President and CEO of Atlas
upholding the highest standards along our value Copco Group. He will step down from his current
chain. position as of April 2024. He is also chairman of
the board of Piab AB, a board member of Wärtsilä
We also enhanced our anti-bribery and corruption and member of the Royal Swedish Academy of
controls in line with a three-year Deferred Engineering Sciences.
Prosecution Agreement (DPA) with the United
States Department of Justice and Securities and With Johan’s and Mats’ experience as seasoned
Exchange Commission. The Board of Directors is senior leaders with a particular focus on industrial
responsible for overseeing compliance with the companies and decentralized operating models,
requirements of the DPA, instituted a year ago, they will perfectly complement the Board of
which include the engagement of an independent Directors with its strong combination of CEO,
Board counsel expert. CFO, industry, geographic/regional, sustainability
and technology experience. With their election, the
Board assessment/composition entire Board of Directors will have been renewed
within the past nine years.
Every year, the Board of Directors conducts
internal self-assessments in which each member On behalf on the Board of Directors, I would like to
assesses the Board’s composition, processes, thank you for your trust and support.
culture and relationship with executive
management, as well as its responsibilities, Peter Voser
performance and the role of the Chairman. This
year’s assessment concluded that the Board was
more diverse than at any time during the Chairman of the Board of Directors
members’ tenures and that collaboration was Zurich, February 23, 2024
6 ABB CORPORATE GOVERNANCE REPORT 2023

—
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.

Swiss corporate law has been revised, effective as of January 1, 2023. The main objectives of the revision
were to strengthen shareholder rights, improve corporate governance and modernize corporate law in
general. Swiss corporations are required to amend their articles of incorporation and other organizational
regulations, as applicable, for compliance with the new law by the end of 2024 at the latest. The
shareholders of ABB approved the necessary changes to ABB’s Articles of Incorporation as proposed by
the Board at ABB’s Annual General Meeting in March 2023.

Compensation governance and Board and EC compensation

Information about ABB’s compensation governance as well as Board and Executive Committee (EC)
compensation and shareholdings is provided in the Compensation Report 2023.
ABB CORPORATE GOVERNANCE REPORT 2023 7

—
Board of Directors

Board and Board committees (2023–2024 Board term)

Board of Directors
Chairman: Peter R. Voser Gunnar Brock Denise C. Johnson

Vice‑Chairman: Jacob Wallenberg David Constable Jennifer Xin-Zhe Li

Frederico Fleury Curado Geraldine Matchett

Lars Förberg David Meline

Finance, Audit and Compliance Governance and Nomination Compensation

Committee Committee Committee
David Meline (chairman) Peter R. Voser (chairman) Frederico Fleury Curado (chairman)

Gunnar Brock Lars Förberg David Constable

Denise C. Johnson Jennifer Xin-Zhe Li Jennifer Xin‑Zhe Li

Geraldine Matchett Jacob Wallenberg

Board governance

The Board
The Board defines the ultimate direction of the business of ABB and issues the necessary instructions. It
determines the organization of the ABB Group and appoints, removes and supervises 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 (FACC), the Governance and Nomination Committee (GNC), and the
Compensation Committee (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.
8 ABB CORPORATE GOVERNANCE REPORT 2023

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.

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 Vice‑Chairman is elected by the Board and handles the responsibilities of the Chairman to the extent
the Chairman is unable to do so or would have a conflict of interest in doing so. He also acts as
counselor/advisor to the Chairman on any matters that are Company or Board relevant and as appropriate
or as the Chairman may require and with a particular focus on strategic aspects related to the Company
and its business in general. In addition, the Vice‑Chairman takes such other actions as may be decided by
the Board or requested by the Chairman.

Finance, Audit and Compliance Committee

The FACC is responsible for overseeing (1) the integrity of ABB’s financial 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 and accounting. 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. The Board has determined that David Meline, chairman of the FACC, is an audit
committee financial expert, in accordance with the rules of the New York Stock Exchange.

Governance and Nomination Committee

The GNC is responsible for (1) overseeing corporate governance practices within ABB, (2) overseeing ABB’s
sustainability agenda (including corporate social responsibility, health, safety and environment),
(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.
ABB CORPORATE GOVERNANCE REPORT 2023 9

Board membership

Board composition
In proposing individuals to be elected to the Board, the Board seeks to align the composition and skills of
the Board with the Company’s strategic needs, business portfolio, geographic reach and culture. The
Board strives for diversity in all aspects including gender, nationalities, ethnicity, geographic/regional
experience and business experience. In addition, the average 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.

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 (2023–2024 Board term)

Corporate Officer
Board Experience Experience Other Business Experience

Country of Origin /
Global Experience

Non-Executive
Tenure (years)

Sustainability

Independent
Management
Other Public

Nationality
Technology
Operations
Experience
ABB Board

Digital /

Gender
Board

CEO

CFO

Risk

Board Member

Peter R. Voser 9 ● ● ● ● ● ● ● ● CH M Yes Yes

Jacob Wallenberg 25 ● ● ● ● ● ● ● SE M Yes Yes

Gunnar Brock 6 ● ● ● ● ● ● SE M Yes Yes

David Constable 9 ● ● ● ● ● ● CA, US M Yes Yes

Frederico Fleury Curado 8 ● ● ● ● ● ● ● BR, PT M Yes Yes

Lars Förberg 7 ● ● ● ● ● SE, CH M Yes Yes

Denise C. Johnson 1 ● ● ● ● ● ● US F Yes Yes

Jennifer Xin-Zhe Li 6 ● ● ● ● ● ● ● CN, CA F Yes Yes

Geraldine Matchett 6 ● ● ● ● ● CH, UK, FR F Yes Yes

David Meline 8 ● ● ● ● US, CH M Yes Yes

10 ABB CORPORATE GOVERNANCE REPORT 2023

Peter R. Voser has been a member Frederico Fleury Curado has been a
and Chairman of ABB’s Board of member of ABB’s Board of Directors
Directors since April 2015. He was since April 2016. He is a member of
also ABB’s Chief Executive Officer the boards of directors of
from April 2019 to February 2020. He Transocean Ltd. (Switzerland) and
is a member of the board of directors of IBM LATAM Airlines Group S.A. (Chile). Through April
Corporation (US). He is also a member of the 2023, he was a member of the board of directors
board of directors of Temasek Holdings (Private) of Ultrapar S.A. (Brazil). He was formerly the chief
Limited (Singapore) as well as chairman of the executive officer of Ultrapar S.A. and Embraer S.A.
board of PSA International Pte Ltd (Singapore), (both Brazil). Mr. Curado was born in 1961 and is a
one of its subsidiaries. In addition, he is the Brazilian and Portuguese citizen.
chairman of the board of trustees of the St. Gallen
Foundation for International Studies. He was Lars Förberg has been a member of
previously the chief executive officer of Royal ABB’s Board of Directors since April
Dutch Shell plc (The Netherlands). Mr. Voser was 2017. He is co‑founder and
born in 1958 and is a Swiss citizen. managing partner of Cevian Capital.
Mr. Förberg was born in 1965 and is
Jacob Wallenberg has been a a Swedish and Swiss citizen.
member of ABB’s Board of Directors
since June 1999 and Vice-Chairman Denise C. Johnson has been a
since April 2015. He is the chairman member of ABB’s Board of Directors
of the board of Investor AB since March 2023. She is a member
(Sweden). He is vice‑chairman of the boards of of the boards of directors of the US
Telefonaktiebolaget LM Ericsson, Wallenberg National Mining Association, the
Investments AB, FAM AB and Patricia Industries (all National Association of Manufacturers and the US
Sweden). He is also a member of the board of Chamber of Commerce (all US). Through
directors of the Knut and Alice Wallenberg December 2023, she was a member of the board of
Foundation as well as a member of the nomination directors of the Mosaic Company (US).
committee of SAS AB (both Sweden). Ms. Johnson is group president of Caterpillar Inc.
Mr. Wallenberg was born in 1956 and is a Swedish (US), responsible for Resource Industries. Before
citizen. joining Caterpillar in 2011, she worked for General
Motors (GM) in different managerial roles in the US
Gunnar Brock has been a member of and as president and managing director of GM in
ABB’s Board of Directors since Brazil. Ms. Johnson was born in 1966 and is a US
March 2018. He is chairman of the citizen.
boards of directors of Neptunia
Invest AB and Stena AB (both Jennifer Xin-Zhe Li has been a
Sweden) and a member of the boards of directors member of ABB’s Board of Directors
of Investor AB and Patricia Industries (both since March 2018. She is a member
Sweden). He was formerly president and chief of the boards of directors of SAP SE
executive officer of Atlas Copco AB (Sweden). (Germany) and Full Truck Alliance
Mr. Brock was born in 1950 and is a Swedish Co. Ltd. (Cayman Islands/P.R.C.). Through
citizen. February 2023, she was a member of the board of
directors of Kone Oy (Finland). Ms. Li is a founder
David Constable has been a member and general partner of Changcheng Investment
of ABB’s Board of Directors since Partners (P.R.C.), a private investment fund. From
April 2015. He is the chairman of the 2008 to 2018, she served as chief financial officer
board of directors and chief of Baidu Inc. (P.R.C.) and chief executive officer of
executive officer of Fluor Baidu Capital (P.R.C.). Prior to that, Ms. Li spent 14
Corporation (US). He was formerly the chief years with General Motors, holding various senior
executive officer and president as well as a finance positions, including chief financial officer
member of the board of directors of Sasol Limited of GM China and corporate controller for GMAC
(South Africa). He joined Sasol after more than 29 North American Operations. Ms. Li was born in
years with Fluor Corporation (US). Mr. Constable 1967 and is a Canadian citizen.
was born in 1961 and is a Canadian and US citizen.
ABB CORPORATE GOVERNANCE REPORT 2023 11

Geraldine Matchett has been a David Meline has been a member of

member of ABB’s Board of Directors ABB’s Board of Directors since April
since March 2018. Through 2016. He is a member of the boards
September 2023, she was the co- of directors of HP Inc. and Pacific
chief executive officer and the chief Biosciences of California, Inc. (both
financial officer of DSM-Firmenich (Switzerland), US). From 2011 through 2022, he held chief
and prior to the DSM-Firmenich merger of DSM financial officer roles at Moderna Inc., Amgen Inc.
(The Netherlands). She was previously the chief and the 3M Company (all US). From 2008 through
financial officer of SGS Ltd (Switzerland). Prior to 2011 he was the corporate controller and chief
joining SGS she worked as an auditor at Deloitte accounting officer of the 3M Company (US). Prior
Ltd (Switzerland) and KPMG LLP (UK). to joining 3M, Mr. Meline worked for more than 20
Ms. Matchett was born in 1972 and is a Swiss, years for General Motors Company (US). Mr. Meline
British and French citizen. was born in 1957 and is a US and Swiss citizen.

As of December 31, 2023, 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.

The table below shows the number of meetings held during 2023 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.

2023 Board and Board Committee Meetings

Pre Annual General Meeting 2023 Post Annual General Meeting 2023
Board Board
Conf. Conf.
Meetings and attendance Mtg. Call FACC GNC CC Mtg. Call FACC GNC CC
Average duration (hours) 7.75 1 2.75 1.75 1.75 7.75 1.25 3.25 1.25 1.25
Number of meetings 1 1 3 2 2 4 2 4 3 5
Meetings attended:
Peter R. Voser 1 1 2 4 2 3
Jacob Wallenberg 1 1 2 4 1 3
Gunnar Brock 1 1 3 4 2 4
David Constable 1 1 2 4 2 5
Frederico Fleury Curado 1 1 2 4 2 5
Lars Förberg 1 1 2 4 2 3
Denise C. Johnson(1) 4 2 4
Jennifer Xin-Zhe Li 1 1 1 2 4 2 3 4
Geraldine Matchett 1 1 3 4 1 3
David Meline 1 1 3 4 2 4
Satish Pai(2) 1 1 2
(1) Elected at ABB’s Annual General Meeting 2023.
(2) Did not stand for re-election at ABB’s Annual General Meeting 2023.
12 ABB CORPORATE GOVERNANCE REPORT 2023

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.

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.

Caterpillar Inc. (Caterpillar) is an important customer of ABB. ABB sells primarily motors and generators
through its Motion business to Caterpillar. Denise Johnson is a group president of Caterpillar.

After reviewing the level of business with Fluor and Caterpillar, 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.
ABB CORPORATE GOVERNANCE REPORT 2023 13

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 2023 were those related to information and cyber security, availability of
components and price volatility, lack of qualified and available resources and geopolitical instability. 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.
14 ABB CORPORATE GOVERNANCE REPORT 2023

—
Executive Committee

Composition of the Executive Committee (at December 31, 2023)

Björn Rosengren
Chief Executive Officer

CORPORATE OFFICERS BUSINESS AREA PRESIDENTS

Timo Ihamuotila Morten Wierod

Chief Financial Officer Electrification

Carolina Granat Peter Terwiesch

Chief Human Resources Officer Process Automation

Karin Lepasoon Tarak Mehta

Chief Communications and Sustainability Officer Motion

Sami Atiya
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, 2023):

Björn Rosengren was appointed Timo Ihamuotila was appointed

Chief Executive Officer and member Chief Financial Officer and member
of the Executive Committee of the Executive Committee
effective March 2020. He is a effective April 2017. He is a member
member of the board of directors of of the board of directors of
the World Childhood Foundation (Sweden). Before SoftwareONE Holding AG (Switzerland). Through
joining ABB, he was the president and chief May 2023, he was a member of the board of
executive officer of Sandvik AB (Sweden) since directors of Hitachi Energy Ltd (Switzerland). From
2015. Prior to that, Mr. Rosengren was the chief 2009 to 2016, Mr. Ihamuotila was chief financial
executive officer of Wärtsilä Corporation (Finland) officer and an executive vice president of the
from 2011 to 2015. He held a variety of Nokia Corporation (Finland). From 1999 to 2009,
management roles at Atlas Copco AB (Sweden) he held various senior roles with Nokia.
from 1998 to 2011. Mr. Rosengren was born in 1959 Mr. Ihamuotila was born in 1966 and is a Finnish
and is a Swedish citizen. citizen.
ABB CORPORATE GOVERNANCE REPORT 2023 15

Carolina Granat was appointed Chief Tarak Mehta was appointed

Human Resources Officer and President of the Motion business
member of the Executive Committee area effective April 2022 and has
effective January 2021. She joined been a member of the Executive
ABB in 2020 as Head of People Committee since October 2010. He
Development. Prior to that, she was globally is a member of the board of directors of Prysmian
responsible for human resources at the machining S.p.A. (Italy). He was President of the
solutions business area of Sandvik AB (Sweden). Electrification business area since April 2019 and
Ms. Granat was born in 1972 and is a Swedish President of the Electrification Products division
citizen. from 2016 to 2019. From October 2010 through
December 2015, he was President of the Low
Karin Lepasoon was appointed Chief Voltage Products division. From 2007 to 2010, he
Communications and Sustainability was Head of ABB’s transformers business.
Officer and member of the Executive Between 1998 and 2006, he held several
Committee effective October 2022. management positions with ABB. Mr. Mehta was
She joined ABB from Vattenfall, born in 1966 and is a US and Swiss citizen.
where she served as head of group
communications and public & regulatory affairs Sami Atiya was appointed President
and member of the company’s group executive of the Robotics & Discrete
management team. Prior to that, Ms. Lepasoon Automation business area effective
also served as head of global marketing and April 2019 and has been a member
communications at SEB, director of sustainability, of the Executive Committee since
communications and HR at Nordic Capital, head of June 2016. He is a member of the board of
strategy and chief of staff at Skanska, and held directors of SGS SA (Switzerland). He had
various other roles in the area of communications. previously been President of the Robotics and
Ms. Lepasoon was born in 1968 and is a Swedish Motion division since January 2017. From June to
citizen. December 2016 he was President of the Discrete
Automation and Motion division. Prior to joining
Morten Wierod was appointed
ABB, Mr. Atiya held senior roles at Siemens in
President of the Electrification
Germany from 1997 to 2015, including as chief
business area effective April 2022
executive officer of the mobility and logistics
and has been a member of the
division in the infrastructure and cities sector
Executive Committee since April
from 2011. Mr. Atiya was born in 1964 and is a
2019, when he was appointed President of the
German citizen.
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 On October 30, 2023, ABB announced that
Director of the Control Products business unit in Mathias Gaertner had been appointed General
the Low Voltage Products division. Between 1998 Counsel and Company Secretary and a member of
to 2011, he held various management roles with the Executive Committee (press release available
ABB. Mr. Wierod was born in 1972 and is a at new.abb.com/news/detail/108999/abb-
Norwegian citizen. appoints-mathias-gaertner-as-general-counsel-
and-company-secretary). He will join ABB in 2024
Peter Terwiesch was appointed
from Holcim, a global construction materials
President of the Process
company, where he has been head legal &
Automation business area and
compliance and a member of its group executive
member of the Executive
committee since 2021. Mr. Gaertner was born in
Committee effective January 2015
1973 and is a German citizen.
(Process Automation known as Industrial
Automation from 2017 until 2020). He is a member
Further information about the members of the
of the board of directors of Hilti AG Executive Committee can be found on ABB’s
(Liechtenstein). From 2011 to 2014, Mr. Terwiesch
website under the Executive Committee link
was Head of ABB’s Central Europe region. He was (available at
ABB’s Chief Technology Officer from 2005 to 2011.
https://new.abb.com/about/corporate-
From 1994 to 2005, he held several positions with
governance).
ABB. Mr. Terwiesch was born in 1966 and is a
German and Swiss citizen.
16 ABB CORPORATE GOVERNANCE REPORT 2023

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).
ABB CORPORATE GOVERNANCE REPORT 2023 17

—
Shares

Share capital of ABB

At December 31, 2023, ABB’s ordinary share capital (including treasury shares) as registered with the
commercial register amounted to CHF 225,840,309, divided into 1,882,002,575 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. On
April 25, 2023, ABB announced its plans to delist its American Depositary Receipts (ADR) from the
New York Stock Exchange, and ultimately to seek to deregister its ADRs and the underlying shares under
the US Securities Act of 1934. The delisting became effective on May 23, 2023, and the ADR program was
converted into a sponsored Level I ADR program, trading on the US over-the-counter market. At
December 31, 2023, ABB Ltd had a market capitalization based on outstanding shares (total number of
outstanding shares: 1,841,507,246) of approximately CHF 67 billion ($82 billion, SEK 820 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,
2023, 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 990 billion.

Stock exchange listings (at December 31, 2023)

Stock exchange Security Ticker symbol ISIN code

SIX Swiss Exchange ABB Ltd, Zurich, share ABBN CH0012221716

SIX Swiss Exchange ABB Ltd, Zurich, share buyback ABBNE CH0357679619
(second trading line)
NASDAQ OMX Stockholm Exchange ABB Ltd, Zurich, share ABB CH0012221716
(1)
BSE Ltd. (Bombay Stock Exchange) ABB India Limited, Bangalore, share ABB 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 82,742,500 shares repurchased under ABB’s
2021/22 and 2022/23 share buyback programs. These shares were cancelled in June 2023, resulting in a
reduced total number of issued ABB Ltd shares of 1,882,002,575.

In April 2023, ABB launched a follow-up share buyback program of up to $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 17,167,000 shares as per December 31, 2023.

ABB intends to use the capital band (see “Capital band” below) again for cancellation of shares
repurchased under the share buyback program 2023/24.
18 ABB CORPORATE GOVERNANCE REPORT 2023

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 9,100,000 shares as per December 31, 2023, primarily for use in
connection with employee share programs. Further information can be found at
https://www.abb.com/investorrelations.

Changes to the ordinary share capital

Except for the share cancellations described above and in ABB’s Annual Report 2022 and 2021 on Form
20-F, there were no other changes to ABB’s ordinary share capital during 2023, 2022 and 2021.

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, 2023, 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 10.6 percent. The contingent share capital has not changed during the last three
years.

At December 31, 2023, 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.
ABB CORPORATE GOVERNANCE REPORT 2023 19

At December 31, 2023, 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 5.0 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).

Capital band

In line with the revised provisions of the Swiss Code of Obligations effective since January 1, 2023,
shareholders approved at ABB’s Annual General Meeting 2023 the introduction of 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 that time. The capital band replaced the authorized
capital, which expired in March 2023 and no longer exists under the revised law.

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 the share buyback programs
2021/22 and 2022/23 and intends to use it again for cancellation of shares repurchased under the share
buyback program 2023/24 (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 (i) ABB’s contingent
share capital and from (ii) 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.
20 ABB CORPORATE GOVERNANCE REPORT 2023

—
Shareholders

Shareholder structure

At December 31, 2023, the total number of shareholders directly registered with ABB Ltd was
approximately 88,000 and another 550,000 shareholders held shares indirectly through nominees. In total,
as of that date, ABB had approximately 638,000 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, 331/3 percent, 50 percent or 662/3 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 owned
232,165,142 ABB Ltd shares and controlled 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, 2023, it owned 265,385,142 ABB Ltd shares and controlled 14.1
percent of the voting rights in ABB Ltd. The number of shares held by Investor AB does not include shares
held by Mr. Jacob Wallenberg, the chairman of Investor AB and a director of ABB, in his individual capacity.

BlackRock, Inc., U.S.A., disclosed to ABB and the SIX Swiss Exchange that as per June 1, 2023, it owned
82,027,197 ABB Ltd shares and controlled 5.05 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/TAMBH00029).

At December 31, 2023, 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 2023 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).
ABB CORPORATE GOVERNANCE REPORT 2023 21

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 Meetings 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.
22 ABB CORPORATE GOVERNANCE REPORT 2023

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.

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 2023. 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 Citibank 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.
ABB CORPORATE GOVERNANCE REPORT 2023 23

—
Independent external auditors

Duration of the mandate and term of office of the auditors

On March 23, 2023, 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 2023 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

Our 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 2023, 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, the FACC approves in advance any non-audit services to be
performed by the auditors.

At least annually, the FACC obtains and reviews a report by the auditors that includes discussion on:

• The Company’s internal control procedures;

• 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.

Audit and additional fees paid to the auditors

The audit fees charged by KPMG for the legally prescribed audit amounted to $42.0 million in 2023. 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.
24 ABB CORPORATE GOVERNANCE REPORT 2023

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. Included in the 2023 audit fees were approximately $2.3 million
related to audits from 2022 and earlier, which were not agreed until after the Company had filed its annual
report on Form 20-F with the SEC on February 24, 2023.

In addition, KPMG charged $4.7 million for non-audit services during 2023. Non-audit services include
primarily service organization attestation procedures, carve-out financial statement audits in relation to
transactional activities, 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 accordance with the requirements of the U.S. Sarbanes Oxley Act of 2002 and rules
issued by the SEC, we utilize a procedure for the review and pre-approval of any services performed by
KPMG.

In total, KPMG charged ABB fees for audit and non-audit services rendered in 2023 in the amount of
$46.7 million.
ABB CORPORATE GOVERNANCE REPORT 2023 25

—
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, 2023, 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 2023.

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 2023.
26 ABB CORPORATE GOVERNANCE REPORT 2023

—
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. ABB also submits an annual report on Form 20-F to the Securities and Exchange
Commission (SEC). 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.
Press releases relating to financial results and material events are also filed with the SEC on Form 6-K. An
archive containing annual reports, Form 20-F reports, quarterly results releases and related presentations
can be found in the “Financial results and presentations” 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 7111
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.
ABB CORPORATE GOVERNANCE REPORT 2023 27

Appendix - ABB Ltd’s significant subsidiaries

Group Share
Interest capital in
Name/Location Country % thousands Currency
ABB Australia Pty. Limited, Moorebank Australia 100.00 131,218 AUD
ABB Group Holdings Pty. Ltd., Moorebank Australia 100.00 537,988 AUD
ABB Group Investment Management Pty. Ltd., Moorebank Australia 100.00 520,318 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 —(2) CAD
(2)
ABB Inc., Saint-Laurent Canada 100.00 — 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, Skovlunde 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 Striebel & John GmbH, Sasbach Germany 100.00 1,050 EUR
B + R Industrie-Elektronik GmbH, Bad Homburg Germany 100.00 358 EUR
Busch-Jaeger Elektro GmbH, Lüdenscheid Germany 100.00 1,535 EUR
ABB Global Business Services and Contracting India
Private Limited, Bangalore India 100.00 5,200,100 INR
28 ABB CORPORATE GOVERNANCE REPORT 2023

Group Share
Interest capital in
Name/Location Country % thousands Currency
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 74.70 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
Korea, Republic
ABB Ltd., Seoul of 100.00 23,670,000 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 74.70 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 —(2) USD
ABB Electrical Industries Co. Ltd., Riyadh Saudi Arabia 65.00 181,000 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 74.70 1,138 CHF
ABB Schweiz AG, Baden Switzerland 100.00 55,000 CHF
Taiwan (Chinese
ABB Ltd., Taipei Taipei) 100.00 195,000 TWD
ABB Elektrik Sanayi A.S., Istanbul Turkiye 99.99 165,000 TRY
United Arab
ABB Industries (L.L.C.), Dubai Emirates 49.00(1) 5,000 AED
United Arab
ABB Industries FZE, Dubai Emirates 100.00 3,000 AED
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 74.70 — USD
ABB Finance (USA) Inc., Wilmington, DE United States 100.00 1 USD
ABB CORPORATE GOVERNANCE REPORT 2023 29

Group Share
Interest capital in
Name/Location Country % thousands Currency
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
(2)
ABB Motors and Mechanical Inc., Fort Smith, AR United States 100.00 — USD
ABB Treasury Center (USA), Inc., Wilmington, DE United States 100.00 1 USD
(2)
Edison Holding Corporation, Wilmington, DE United States 100.00 — USD
(2)
Industrial Connections & Solutions LLC, Cary, NC United States 100.00 — USD

(1) Company consolidated as ABB exercises full management control.

(2) Shares without par value.
30 ABB CORPORATE GOVERNANCE REPORT 2023

Caution concerning forward-looking statements

The Corporate Governance Report 2023 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.
ABB CORPORATE GOVERNANCE REPORT 2023 31