Sustainability across the value chain: an accelerator for health systems resilience

The health of people and the health of the planet are inseparable. That’s why we embed sustainability into the heart of how we innovate, operate and collaborate, and as part of our (employee) culture – not as an add-on, but as a core enabler of delivering better care for more people. That bold idea powers our relentless search for ways to deliver smart, sustainable care. Together with the entire healthcare industry, we have an urgent responsibility to team up to drive sustainable and systemic change.

Come along as we dig into how we’re embedding sustainability into Philips’ DNA. By partnering to leverage our collective expertise, (digital) innovation capabilities and shared drive to effect systemic change, we can combine environmentally and socially sustainable practices – and support net zero healthcare – with safe, efficient and effective methods of care. And we can do this while advancing access to care and promoting community and rural health. Our goal? Improving people’s health and well-being through meaningful innovation; making the future of healthcare one that works for healthcare professionals, patients, communities and the planet.

In 2023, Philips became the first health technology company to have its entire value-chain CO₂ emissions reduction targets – covering scopes 1, 2, and 3 – approved by the Science Based Targets initiative (SBTi). Building on our achievement of carbon-neutral operations since 2020 (including business travel, transportation, and distribution), we recognize the vital importance of scope 3, as responsible sourcing of goods and services not only reduces our own footprint but also positively impacts our customers’ environmental performance. Our science-based net-zero target, recently validated by SBTi, is supported by on-site renewables and Power Purchase Agreements such as the Los Mirasoles Wind Farm in the US. Looking ahead, we are committed to achieving net-zero greenhouse gas emissions across the entire value chain by 2045.

While driving and embedding sustainability across our operations, we continue to innovate, grow and scale up our portfolio of energy-efficient, circular, digital and cloud-based solutions, which can significantly reduce a hospital’s carbon footprint and often bring down costs and increase efficiency. Beyond 2025, we aspire to enable fully circular operations, with an increased focus on reducing material usage, reusing materials and recycling used materials. We aim to continue to send zero used materials to landfills.

Let’s get real: you can’t fix environmental impact with wishful thinking or a splash of green paint after the fact. Next-level sustainability starts with how products are imagined and engineered. That’s the Philips EcoDesign approach – where every device is scrutinized for energy use, materials and its eventual afterlife. Our EcoDesign program ensures that every new product introduction meets certain environmental criteria. By the end of this year (2025), our goal is that all new product introductions (NPI) are in line with the Philips EcoDesign process and requirements. Meeting growing customer demand to support their environmental ambitions, these products are designed to increase energy efficiency and circularity across the product life cycle, with sustainable material choices supporting reduced and sustainable material use in product and packaging; for example, by considering the use of recycled or biobased material alternatives.

Think of EcoDesign as a pre-flight checklist for our products. Can we swap in more recycled material? Can we cut unnecessary energy use? Is there a clever way to make end-of-life recycling easier? Every answer gets us a step closer to tech that raises the bar for hospitals and the planet.

We also implement smart digital solutions – a major catalyst to deliver maximum value with minimum materials. Digitalization supports the shift from resource-intensive clinical facilities to networked lower-cost settings and the home, thereby expanding access to care. Increasingly, Philips' innovations are leveraging Artificial Intelligence (AI) to create smarter, connected health solutions.

Here’s a plot twist: the trip from one of our facilities to your clinic is a surprisingly big deal. That’s why we don’t simply box up a CT and wish it luck; instead, we constantly fine-tune our transportation strategies, from smarter routes to more environmentally sustainable partners. Fewer emissions, tighter efficiency and a supply chain that’s as lean (and green) as we can make it – all part of our playbook.

Sustainability isn’t a solo act; it’s a group performance – and the whole village is involved, from our suppliers to our shippers so that every touchpoint shrinks our collective footprint.

Beyond our own operations, we actively engage with our supply chain partners as well as our customers and peers across the value chain to effect, implement and scale sustainable and circular ways of working. This means ensuring emission reduction targets across our entire value chain are aligned with third-party global frameworks.

Through our Supplier Sustainability program³, recognized in Fortune’s 2024 ‘Change the World’ rankings⁴, Philips collaborates closely with suppliers. We use the tools, expertise and experience gained while greening our own operations to help suppliers identify and mitigate their emissions. For example, we offer improved payment terms to suppliers that take concrete steps on climate action, incentivizing them to adopt and meet such targets. We work to have at least 50% of our suppliers (based on spend) committed to science-based targets for CO₂ emission reduction by end of this year (2025), with an expected knock-on effect much greater impact than through simply lowering CO₂ emissions from our own operations.

Imaging devices can be responsible for more than half of a radiology department’s greenhouse gas emissions⁵. Yes, you read that right. Most of that footprint comes from the day-in, day-out use of energy-hungry machines.

Philips leans hard into energy efficiency across our lineup, because those daily savings add up – big time:

Let’s not pretend Philips can solve this alone. Partnership is the secret sauce. By working together with our customers, peers and partners, we can help drive sustainable ways of working across the healthcare value chain – and in every aspect of business. We work shoulder-to-shoulder with healthcare systems, academic heavyweights, industry peers and more. For instance, together with Vanderbilt University Medical Center (USA), Philips is determining a blueprint to guide industry efforts to decarbonize radiology. Early results of the research collaboration showed that sustainable initiatives can be both environmentally friendly and cost-effective.¹¹

Whether we’re trading notes at CleanMed, collaborating on research or co-developing new metrics for progress, we’re building a global network that keeps healthcare on the low-carbon track. Philips goes beyond the product. We serve as an advisor – offering assessments, sharing knowledge and helping health leaders craft their own sustainability journeys. The goal: keep things moving at a pace that matches each partner’s readiness and ambition.

We are also teaming up with healthcare providers in clinics and hospitals and with governments to deliver innovative technology solutions that enable equity and access to care. Beyond ensuring the availability of care, delivering equitable healthcare means tackling broader barriers – like affordability, health awareness and physical distance from hospitals – that stand in the way of people accessing quality care and, ultimately, achieving their best health outcomes.

Bringing healthcare’s carbon footprint down isn’t a single sprint – it's a relay, with each organization carrying the baton a little further. By weaving sustainability all the way through the value chain, Philips and our partners are driving a future where great healthcare and great stewardship go hand in hand.