Philips reinforces its leadership as a purpose-driven company with
an enhanced and fully integrated approach to doing business
responsibly and sustainably
September 14, 2020
- On track to fully achieve all the targets of ithilips
reinforces its leadership as a purpose-driven company with an
enhanced and fully integrated approach to doing business
responsibly and sustainabs pioneering ‘Healthy people, Sustainable
planet’ 2016 - 2020 program, Philips steps up further and makes
ambitious Environmental, Social and Corporate Governance (ESG)
commitments for 2025
- Environmental: Philips commits to 100% EcoDesign, increased
energy efficiency, expanded renewable energy sourcing, and circular
economy solutions – targeting Paris Agreement 1.5 oC global warming
limit
- Social: Philips commits to improving the lives of 2 billion
people a year by 2025 [1] through its innovations, including 300
million people in underserved communities
- Governance: Philips will ensure transparency regarding its tax
contribution for all countries it operates in
Amsterdam, the Netherlands – Royal Philips
(NYSE: PHG, AEX: PHIA), a global leader in health technology, today
further reinforced its commitments as a purpose-driven company with
the announcement of an enhanced and fully integrated approach to
doing business responsibly and sustainably. Currently completing
its ‘Healthy people, Sustainable planet’ 2016 - 2020 program,
Philips is set to achieve all of the program’s ambitious targets by
the end of the year, including generating 70% of its sales from
green products and services with 15% from circular economy
solutions, becoming CO2-neutral in its operations, recycling 90% of
its operational waste, and sending zero waste to landfill [2].
Building on this strong track record, Philips’ new framework
comprises a comprehensive set of key commitments across all the
Environmental, Social and Corporate Governance (ESG) dimensions
that guide execution of the company’s strategy. It includes
ambitious targets and detailed plans of action.
“When we started our transformation journey, our aim was to make
sure that Philips stayed relevant - that we could apply our
tremendous innovation strength to make a difference to people’s
lives,” said Frans van Houten, CEO of Royal Philips. “As a leading
health technology company today, our purpose is to improve people’s
health and well-being through meaningful innovation, positively
impacting 2 billion lives per year by 2025. We aim to grow Philips
responsibly and sustainably, and we therefore continuously set
ourselves challenging environmental and social targets, and live up
to the highest standards of governance. Acting responsibly towards
the planet and society is part of our DNA. I am convinced that this
is the best way for us to create superior, long-term value for
Philips’ multiple stakeholders.”Environmental:
100% of new product introductions in line with Philips’
EcoDesign requirements by 2025 Respecting the planet’s
environmental limits, Philips is committed to science-based
targets, reducing its carbon footprint across its entire value
chain in line with a 1.5 oC global warming scenario – as
recommended by the United Nations Framework Convention on Climate
Change (UNFCCC) and in line with the Paris Agreement. Through
investments in green innovation, 100% of its products and services
will be designed in line with Philips’ EcoDesign requirements aimed
at improving energy efficiency, especially during the customer use
phase. 'Eco-Hero’ products - breakthrough products and solutions
with clear sustainability benefits - will account for 25% of
revenues.By 2025, the company will source 75% of its total energy
consumption (including fuel) from renewable sources (compared to
36% in 2015). It will also ramp up its circular economy revenues
from 15% to 25% of sales, extend its trade-in program to all its
professional medical equipment, embed circular practices at its
sites, and send zero waste to landfill. Philips will also work with
its suppliers to reduce the environmental footprint of its entire
supply chain in line with the 1.5 oC global warming scenario.
Unavoidable carbon emissions in Philips’ own operations will be
offset via investment in health-benefitting environmental projects,
such as safe drinking water, clean energy, biodiversity, and
forestation programs.
Social: Improving health &
well-being and inclusivity and diversity in the
workplacePhilips aims to improve the health and well-being
of 2 billion people per year by 2025 [1] through innovation, and
partnering with private and public organizations, including the
Philips Foundation. Lack of access to affordable, quality care is
one of the most pressing issues of this time. COVID-19 has only
intensified the situation, overwhelming health systems around the
world. As part of its overall 2 billion lives improved commitment,
Philips aims to expand access to care for 300 million people in
underserved communities.
Working together with its suppliers through its Supplier
Sustainability Performance Program, which uses artificial
intelligence to measure and predict sustainability performance and
improvements, Philips is also committed to improving the lives of 1
million workers in its supply chain by 2025.
“Philips wants to be the best place to work for people who share
our passion,” said Frans van Houten. “This is why we foster
continuous learning and personal development, as well as an
inclusive culture where people are valued and accepted for their
uniqueness, and where everyone can be their best. We will progress
building an employee base with a rich diversity of people and
perspectives because it is an important driver of innovation and
performance.”
At Philips, employees are empowered to drive their own career
through education, mentoring and employee networking programs.
Employees have access to digital tools for self-development in
order to grow and progress their careers. Driving Inclusion &
Diversity, Philips has set a new goal of 30% gender diversity in
senior leadership positions by the end of 2025, up from the 2020
target of 25% that it expects to meet before the end of this year.
A company-wide training on unconscious bias awareness is part of
the program to build and foster an inclusive environment.Philips
has also deployed a range of programs to support the health and
well-being of its employees, including a global employee assistance
program aimed at helping employees with urgent needs. When COVID-19
emerged, Philips provided support in this area without losing sight
of longer-term needs, such as a healthy work-life balance, stress
management, resilience and prevention of mental health
issues.
Governance: Transparency on tax contributions
Philips has a strong track record of transparency in its plans,
actions and reporting. For example, its CO2 emission-reduction
targets are approved by the Science Based Targets initiative
(SBTi), and its ‘Lives Improved’ performance metric is externally
audited. Philips also engages transparently with shareholders,
customers, business partners, governments and regulators, and
delivers high-quality products and services that comply with all
applicable laws and standards.
In addition to the company’s customary disclosures on tax
contributions that will be made in the Annual Report 2020, Philips
will publish a supplemental financial report for 2020, which will
include the tax contributions for all countries Philips operates
in. This is in line with Philips’ commitment to transparency, and
the company’s view that these tax contributions are social value
contributions to the local communities.
[1] In connection with Philips’ planned divestiture
of its Domestic Appliances business, the company will no longer
include the contribution of the Domestic Appliances portfolio in
its ‘Lives Improved’ reporting. As a result Philips commits to
improving the lives of 2 billion people a year by 2025, and the
lives of 2.5 billion people by 2030.[2] Today, Philips
generates 66% of its sales from green products and services, with
13% from circular economy solutions. Over 95% of its worldwide
operations are currently powered by renewable electricity.
Moreover, 85% of all operational waste is being recycled, and 67%
of Philips’ industrial sites sent zero waste to landfill. Most
recently, Philips North America achieved ‘zero waste to landfill’
status for its manufacturing sites. For more information:
www.results.philips.com.
For further information, please contact:
Joost MalthaPhilips Global Press OfficeTel.: +31 6 10 55 81
16E-mail: joost.maltha@philips.com
Steve KlinkPhilips Global Press OfficeTel.: +31 6 10 88 88
24E-mail: steve.klink@philips.com
About Royal Philips
Royal Philips (NYSE: PHG, AEX: PHIA) is a leading health
technology company focused on improving people's health and
enabling better outcomes across the health continuum from healthy
living and prevention, to diagnosis, treatment and home care.
Philips leverages advanced technology and deep clinical and
consumer insights to deliver integrated solutions. Headquartered in
the Netherlands, the company is a leader in diagnostic imaging,
image-guided therapy, patient monitoring and health informatics, as
well as in consumer health and home care. Philips generated 2019
sales of EUR 19.5 billion and employs approximately 81,000
employees with sales and services in more than 100 countries. News
about Philips can be found at www.philips.com/newscenter.
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