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By Alistair Dormer, Executive Vice President, Green Energy and Mobility, Hitachi, Ltd.
As a social innovation business determined to lead the way on climate change, we have made a concerted effort to focus on where we can have the biggest impact. Indeed, in the last seven years we have divested a number of business units in order to concentrate and re-invest in key areas that can simplify and accelerate the journey to net zero.
In short, we have transformed our business portfolio to put ourselves in the strongest possible position to help deliver our collective climate change ambitions. This is my message to investors: We’re putting our best business set-up forward – are you ready to partner with us? Because this is not a race anyone can win alone.
By selling businesses such as Hitachi Metals, Hitachi Chemical and Hitachi Construction Machinery, we have been able to re-invest in ABB Power Grids (now Hitachi Energy) and digital transformation business GlobalLogic. These two interconnected operations will play a pivotal role in the creation of a future-fit green ecosystem.
Five years ago, if investors had asked me the focus of our business, it would have been more difficult to pinpoint. Today, we have a singular vision of who we are, where we’re going and how we’re going to get there. And we want people to come with us –whatever Hitachi business you work with, you’ll find collaboration at its very heart.
When I assess our 2023 portfolio of businesses, we’re now involved in key sectors such as mobility, energy, industry and digital. These are more than just sectors, these are areas of our society where we are seeing systemic change as a result of the sustainability imperatives we face, from climate change to biodiversity loss, from rising inequality to social inclusion. But at the same time, they all present us with an opportunity to apply our capabilities and grow our business further.
Choosing the partners who can help set the pace is critical to every company on the planet. It is no exaggeration to say that we’re right in the middle of the biggest transformation society has seen since the Industrial Revolution – from renewable energy to sustainable mobility, Europe is leading the way which represents a huge opportunity for Hitachi and our partners.
Having shifted the focus of our business portfolio, we’re well positioned to connect the dots – not just the connection of renewables to the grid and grid technology, but also best-in-class IT and digital capability. When it comes to the latter, our Lumada data platform is pioneering advanced digital solutions, services and technologies for turning data into insights to drive digital innovation, whether it’s driverless metro trains in Copenhagen or the electrification of bus fleets in Glasgow.
The future will need not just infrastructure but smart infrastructure. It will need not just green transportation, but connected and integrated mobility whether that's as a service or as an integrated system which ultimately powers a whole smart green city. At Hitachi we’ve now got the capability to enable this transition, but also to help industry transition with our technology around micro grid energy storage and optimisation of carbon footprint.
But as I said earlier, we can’t do this on our own and what’s really encouraging to me is that we are now engaging in framework agreements with customers – this is an incredibly positive development because it allows us to standardise our approach, to plan better in terms of our production capacity, and to give our customers certainty that they've got resources allocated for them. A good example of this in action is our agreement with transmission system operator TenneT and we’re seeing other European utilities businesses embracing the framework contract approach – we need this kind of momentum if we are to accelerate our progress at the rate required.
We’ve realigned our business to ensure we’re front-runners in climate change, but we need others to help set the pace – are you ready to join the most important race we’ll ever run?