1.

What are the sustainability-related trade-offs in large dam/hydro projects projects in

general, and NT2 in particular?

There are concerns of sustainability, which primarily compromises between the resources and aims of a
dam project. ABB is not exempt from this, as the NT2 project has caused both environmental and social
economic challenges for the company.

As indicated in the letter, environmental challenges include the destruction of water bodies. It entails
pollution of groundwater, loss of minerals and soil fertility, and submergence of infrastructure crops and
other plant life. Dam constructions frequently result in soil erosion as a result of extensive clearing of a
region's vegetation. When the soil is fruitful, Land is being lost, agricultural production is being harmed,
and food security is being jeopardised. Locals lost their job and the whole ecosystem of the surrounding
territories has been disrupted.

This results in animal habitat loss and puts many species at risk. Deforestation causes forest loss and
exacerbates the greenhouse impact. As a result, sea levels rise, climate change occurs, and the
ecosystem continues to deteriorate. Floods have become a routine occurrence, wreaking havoc on food
grains, crops, and livestock.

As previously said, relocation of locals will bring with it additional issues such as meeting all relocation
regulations, compensation, and the acquisition of the locals' current land. Stakeholders in the project
consider this to be a high priority. It is critical for the providers to guarantee that the area's society has
food, housing, and is functioning normally. The relocated farmers and cultivators' employment becomes
a big worry for the government, and education, healthcare, and human well-being become top priorities.
Because relocation results in the loss of cultural, ethnic, or heritage sites, the area's culture is also
impacted.

2. Why might the NT2 dam and the International Rivers letter pose a reputation risk for
ABB?

The International Rivers' allegations were serious, and ABB was determined to make the next project
viable after being denied for the Ilisu Dam project. Because the World Bank and the Asian Development
Bank were both keen to see the NT2 project succeed in terms of environmental and socio-cultural
factors, they were extremely vigilant about the development and kept a close eye on the achievement of
all the goals associated with the public-private partnership in Laos. They saw this project as a key
priority for Laos and Thailand's economic growth, and they were concerned about the vast amount of
income it would generate. Because the stakes and expectations were so great, ABB realised that the risk
of losing its reputation was as considerable. Because the people impacted were oppressed and
disadvantaged, it was critical to protect their livelihood and human rights.

The company's focus has been on long-term sustainability. The company not only pioneered sustainable
techniques, but it was also active in establishing industry standards. The company is known for studying
and drawing a line in the development vs. sustainability tradeoff, as it has done with previous projects
such as dams in China and Turkey. If the claims are proven, the company's goals and methods will be
called into doubt. Its consistent image, which it has developed over time by trying to be at the top of
sustainability rankings, is at risk of being eroded. The project on the other hand has the potential to do
all of this: It is accused of endangering the potability of the water, as well as causing flooding and
erosion. The project also has the potential to jeopardise downstream fishermen's traditional livelihoods.

3. To what extent and how should ABB integrate stakeholder concerns in its business
decisions?

The business culture has begun to embrace the principle of "show me," rather than the previous belief of
"trust me," and society is becoming more interested in the companies that stand behind the brands and
products that are presented to them. The influence of individual corporate operations has risen in recent
decades as stakeholders have become more aware of these concerns.

Customers, investors, the media, and non-governmental organisations are among ABB's stakeholders.
International Rivers filed human rights breaches accusations against ABB, which appear to be valid
because villages were harmed as a result of dam building. This was a severe issue for the corporation,
and if left unanswered, it would harm the company's reputation. So, it is important that ABB integrates
stakeholder concerns in its business decisions.

The Rio Earth Summit of 1992 occurred shortly after the founding of ABB's Environmental Affairs unit,
during which external parties began to acknowledge the industry's impact on the environment and
began to push businesses to take action. As a result, ABB started developing standards for environment
management.

ABB might rebuild residents' confidence by offering a good and enhanced irrigation system, as well as
compensation for land loss. Additionally, adhering to security standards such as the eight elements of
the Occupational Health and Safety Plan will benefit the business in the long term. Implementation plays
a vital role in incorporating stakeholder concerns in this manner.

4. Would you change ABB's sustainability criteria and objectives, and if so, how?

The sustainability criteria of ABB is sole reason why ABB is loosing certain projects which are efficient
enough. Tough the project guidelines and world bank guidelines are inline; they are not inline with ABB’s
due to which ABB will lose the project which takes up by competitor. ABB mostly left the projects which
company felt, that are not satisfying the sustainable criteria, but these projects were then taken by
some other companies which doesn’t bother about sustainability which results in further damage. ABB
with a few changes in its criteria can avoid this to happen, as ABB should see the positive side mostly
and try to dimmish the negative affect of it by proper negotiations and make every stake holder come
under single roof.

ABB sustainability criteria contains each and every small thing which made it extremely wide, which
made the company obliged to face the effect of breach even if the breach is somewhere, which the
company not directly responsible. ABB should change its criteria in such a way that it should avoid facing
bad reputation for external breaches.

The sustainability objectives of ABB are effective mostly like phase out hazardous substances in ABB’s
production and processes and increasing the monitoring of suppliers to ensure they met sustainability
standards expect a few. Changing those few objectives would be enough.

Early assessment of social, security, and environmental risk of the project is being done by the
company, but the company should also consider other parties being assessing all these risks and
submitting a report to the company, which gives different perspectives of the risks involved in long
term.

The guidelines to monitor environmental impact are very strict, which results the cons outperforming the
pros. Strict guidelines were needed but not extreme severe guide lines which makes the small issue
viewed in magnifying glasses.