We expect through-cycle revenue growth of 4 to 7 percent (3 to 5 percent comparable, 1 to 2 percent inorganic) driven by a focused portfolio, new ways of working and accelerating ESG drivers.
To be part of ABB, our businesses need to be aligned with the ABB purpose and enable a more sustainable and resource-efficient future in electrification and automation.
Over the last years, we have taken significant actions to align our business portfolio to more attractive growth markets. From 2016 to 2021, the share of revenues derived from the utilities sector has significantly decreased, while we have increased our focus on discrete industries as well as transport and infrastructure that offer better growth opportunities.
Moving the company into a decentralized operating model, the mandate and accountability for driving growth now sit in each of our approximately 20 divisions, i.e. closer to the market and customers. Each division is different and has different investment needs (e.g. R&D, investments into the sales channels or capex needs) to secure future growth. We firmly believe this new set-up in combination with our improved performance management system will result in more focused and accurate growth activities going forward.
At the same time, we aim to increase the pace of acquisitions to at least 5 small to mid-size (bolt-on) acquisitions annually. The responsibility to build the pipeline of potential targets has been transferred to the divisions and each management team is responsible for adding technology and footprint necessary to hold a number 1-2 market position. Acquisitions can be made in all divisions in order to fill eventual gaps in technology, geography or high-growth segments however only divisions with pure growth mandate are active in consolidating the market.
ABB is well aligned to global megatrends.
Electricity demand growing >2x faster than other energy sources, resulting in ~50% higher average annual investment into distribution networks over next 10 years1
~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
Share of low-carbon sources in global energy mix to increase +30%-points from ~20% today to ~50% in 20501
Global number of working age people (25 to 64 years) per retiree (65 years or over) to fall by ~20% over next 10 years2
1. IEA World Energy Outlook 2021, Announced Pledges Scenario. 2. United Nations World Population Prospects 2019.
Our sustainability strategy also supports the achievement of all 17 of the United Nations’ Sustainable Development Goals. Through our leading technologies and sustainable business practices, we enable seven of the SDG goals directly: 7 (affordable and clean energy); 11 (sustainable cities and communities); 9 (industry, innovation and infrastructure); 6 (clean water and sanitation); 12 (responsible consumption and production); 8 (decent work and economic growth); and 17 (partnership for the goals). We also contribute indirectly to the other 10 SDGs.