Philips Improves Supply Chain Focus in Sustainability Push

Philips is pressing ahead with efforts to cut emissions and embed sustainable practices into healthcare.

The company’s 2024 Sustainability Report outlines actions across supply chain, sourcing, operations and logistics, with product design and supplier collaboration central to progress.

Healthcare brings unique sustainability challenges, but Philips says it is finding ways to reduce environmental impact while maintaining clinical outcomes.

“We are proud of the progress we made in 2024, executing our focused strategy to improve people’s health and well-being, creating sustainable long-term business value for all our stakeholders,” says Marnix van Ginneken, EVP, Chief ESG and Legal Officer and member of Royal Philips’ Board of Management. 

“Our sustainability-led partnerships with customers and suppliers highlight the potential for significant cost savings, improvements in energy efficiency and expanding access to care in and outside the hospital, while the company continues to explore ways to provide consumers with greater choices to live sustainably.”

Operational sustainability through design and sourcing

In 2024, every new product Philips introduced is part of its EcoDesign range.

These products are developed to use less energy, avoid hazardous materials, reduce packaging and make better use of resources during manufacturing. Philips frames this as a shift in operational practice as much as product innovation.

The sourcing strategy behind this push is focused on lower-carbon inputs and better logistics coordination.

By the end of 2024, 47% of supplier spend came from businesses with verified science-based targets for emissions. That figure is up from 46% in 2023 and continues to trend upwards.

On the technology side, Philips continues to improve the energy profile of its imaging equipment.

Key developments include MRI scanners with PowerSave+, which activates a standby mode after 30 minutes of inactivity, and BlueSeal Magnet Technology, a closed system that removes the need for helium refills even in case of machine failure.

Since 2018, this has saved over 2.75 million litres of helium – a finite and expensive resource widely used in imaging.

Extending product lifecycles and reducing logistics waste

Circularity is another key focus.

Philips expands its Refurb Edition and product takeback schemes across parts of Europe in 2024, particularly for personal health items such as shavers and toothbrushes.

The programme gives a second life to products, reducing the demand for raw materials and lowering emissions across the sourcing and production process.

Logistics operations have also come under scrutiny. The company says it has made measurable reductions in CO₂ emissions across its logistics network by switching to low-carbon transport and improving planning.

This ties in with broader emissions cuts across its operations and value chain.

Philips points to ongoing engagement with customers to deliver sustainable care pathways. Examples include energy use mapping, emissions benchmarking and shared work on supply waste.

These are framed as joint projects rather than services, embedding sustainability into daily operations.

In the UK, Philips works with County Durham and Darlington NHS Foundation Trust to pinpoint where intensive care unit (ICU) procedures generate waste or emissions.

The focus includes both patient discharge planning and better management of supply chain waste. Similarly, a collaboration with Vanderbilt University Medical Center in the US reveals that more than half of greenhouse gas emissions from radiology services come from energy use in imaging equipment – evidence Philips says will help refine sourcing and energy strategies.

Building partnerships across the supply chain

Philips maintains that its sustainability strategy relies on cross-sector cooperation.

In Portugal, its partnership with the Champalimaud Foundation has delivered a 24% reduction in emissions per exam in its radiology and nuclear medicine department within the first year. These results, Philips argues, show the value of engaging with providers at all levels of the supply chain.

The company also links progress to internal cultural change. It reports engaging 3,000 people leaders on its business purpose, sustainability targets and strategic priorities in 2024.

Employee engagement and supplier development are both treated as long-term inputs to supply chain performance.

Philips aims to improve the lives of 2.5 billion people a year by 2030. It claims to have reached 1.96 billion in 2024.

Recognition from Forbes as one of the world’s best employers for the sixth year in a row is cited as a sign of ongoing commitment to responsible operations and people management.

Robert Metzke, Senior Vice President and Global Head of Sustainability at Philips, reflects on these efforts by saying: “Above and beyond these results, what stands out to me personally are the meaningful dialogues and continued collaboration with dedicated colleagues, customers, partners and suppliers.

"It sparks so much energy in our work and motivates people every day to do an even better job; structurally shaping a future where healthcare works for all: people, patients and the planet.”

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