Philips announces ambitious climate action to drive significant reduction of greenhouse gas emissions in its supply chain
28 Ottobre 2021 - 10:00AM
Philips announces ambitious climate action to drive significant
reduction of greenhouse gas emissions in its supply chain
October 28, 2021
Aiming for at least 50% of its suppliers (based on spend)
committing to science-based targets for CO₂ emission reduction by
2025, Philips is stepping up its supplier support and
incentivization program Amsterdam, the Netherlands
– Royal Philips (NYSE: PHG, AEX: PHIA), a global leader in
health technology, today announced an additional ambitious action
to combat climate change. The company is stepping up its acclaimed
supplier sustainability program with the goal of at least 50% of
its suppliers (based on spend) committing to science-based targets
(SBTs) [1] for CO₂ emissions reduction by 2025. If successful, this
major push to decarbonize the company’s supply chain – by
supporting its suppliers and incentivizing them to adopt and meet
SBTs – will have an impact seven times greater than the reduction
of CO₂ emissions from Philips’ own operations. Progress updates
will be reported annually in the company’s Annual Report.
“Over the last few years, we have made major progress in
reducing our own greenhouse gas emissions. We have been carbon
neutral in our operations since 2020 and source all of our
electricity from renewable sources,” said Frans van Houten, CEO of
Royal Philips. “We are now using what we have learned to further
build out and scale that success with our partners in the supply
chain, where the overall environmental impact can even be even
greater.”
COP26Philips targets its CO₂ emission reduction
efforts in three key areas. Alongside product and business model
innovation and carbon-neutrality in its own operations, reducing
the CO₂ footprint of its supply chain is key to fulfilling Philips’
commitment to doing business responsibly and sustainably, in line
with the Paris Agreement preferred goal of limiting global warming
to 1.5⁰C. In light of the urgency for agreement at the upcoming
United Nations Framework Convention on Climate Change Conference of
the Parties (COP26), Philips is determined to provide the industry
leadership needed to accelerate climate action and work to create
more resilient and sustainable healthcare together with its
customers and partners across the value chain.
“We are at a critical point of urgency where we need to
accelerate the global transition to climate neutral, circular and
resource-efficient economies and societies,” said Frans van Houten.
“As a purpose-driven company, we are conscious of our
responsibility towards society and have set clear, ambitious
Environmental, Social and corporate Governance (ESG) commitments to
support this major shift. We encourage as many companies, customers
and supply chain partners as possible to commit to climate actions
and science-based targets, deliver on those actions, and provide
proof of progress and delivery through continuous, transparent and
in-depth reporting.”
Building on the company’s existing extensive supplier
sustainability performance program, in which more than 200
suppliers currently participate, Philips will take an active role
in supporting and incentivizing its suppliers to bring about the
changes needed to meet science-based emission reduction targets
within their organizations. This collaborative approach will focus
on structural improvements that maximize the impact of CO₂
reduction activities, as well as offering incentives, such as
direct support for capability building and preferential payment
terms, to accelerate the adoption of SBTs by its suppliers.
By leveraging the latest insights in machine learning and data
science, Philips will iteratively optimize the effectiveness of the
program to extend its reach and impact. Philips will also actively
explore the establishment of Virtual Power Purchase Agreements
(VPPAs) with suppliers, similar to those it already has with
industry consortia, in order to support funding for new renewable
energy projects such as wind farms and solar farms and further
‘green the grid’.
New study on environmental impact of the UK’s health
systemThe global healthcare industry currently accounts
for around 4% of global CO₂ emissions [2]. In the lead up to COP26
Philips, as a key partner to the UK’s National Health System, has
initiated a research project with the University of Exeter, a
globally leading circular economy research institution, to study
the environmental impact of the UK’s health system and evaluate how
Philips’ healthcare products and services can contribute to
reducing the system’s footprint.
Global recognitionPhilips was the first health
technology company to have its CO₂ emission targets for the 2020 -
2040 period assessed and approved by the Science-Based Targets
initiative (STBi). Philips received further recognition for its ESG
performance, achieving top positions in the Dow Jones
Sustainability Index and the Sustainalytics rankings, and eight
consecutive years on the CDP Climate Change A-list. In March
2021, the company was awarded an ESG score of 90 out of 100 by
S&P Global Ratings, the highest score the organization has
awarded to date. Philips also achieved second place in 2020
on Wall Street Journal’s 100 Most Sustainably Managed
Companies in the World.
[1] Science-based targets are a set of goals
developed by a company to provide it with a clear path to reduce
greenhouse gas emissions. Targets are considered ‘science-based’ if
they are in line with what the latest climate science deems
necessary to meet the goals of the Paris Agreement – limiting
global warming to well-below 2°C above pre-industrial levels and
pursuing efforts to limit warming to 1.5°C. More information:
sciencebasedtargets.org[2] European Commission, EDGAR -
Emissions Database for Global Atmospheric Research,
https://edgar.jrc.ec.europa.eu/
For further information, please contact:
Joost MalthaPhilips Global Press OfficeTel: +31 610 558
116Email: joost.maltha@philips.com
Ben ZwirsPhilips Global Press OfficeTel: +31 6 1521 3446Email:
ben.zwirs@philips.com About Royal PhilipsRoyal
Philips (NYSE: PHG, AEX: PHIA) is a leading health technology
company focused on improving people's health and well-being, 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 2020
sales of EUR 17.3 billion and employs approximately 78,000
employees with sales and services in more than 100 countries. News
about Philips can be found at www.philips.com/newscenter.
Forward-looking statements This release contains
certain forward-looking statements with respect to the financial
condition, results of operations and business of Philips and
certain of the plans and objectives of Philips with respect to
these items. Examples of forward-looking statements include
statements made about the strategy, estimates of sales growth,
future EBITA, future developments in Philips’ organic business and
the completion of acquisitions and divestments. By their nature,
these statements involve risk and uncertainty because they relate
to future events and circumstances and there are many factors that
could cause actual results and developments to differ materially
from those expressed or implied by these statements.
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