How do sustainability and innovation fit into a viable strategy?

“Sustainability must be fully integrated into a company’s strategy. CSR (Corporate Social Responsibility) is outdated. Too often, it boils down to enriching yourself first and then giving back a little in hopes of good press. That approach completely ignores the innovation power and societal impact a company can have. For me, sustainable business is about understanding what a company stands for, where society is heading, how the company can serve society, and addressing those needs. Figuring out how to make money while doing that is the strategic challenge. One doesn’t work without the other.”

We only have one planet, and soon we’ll have ten billion people, all of whom will want to live decent lives within the Earth’s limits. Innovation allows us to create solutions that meet these fundamental conditions.

What does Philips stand for in this context?

Metzke explains: “Philips’ ultimate goal is to improve lives. When I joined, I was curious what that truly meant. Whose lives had we improved? And how? Initially, people laughed politely at my questions. But we initiated global research, developed a measurement framework, and set the goal of positively impacting 500 million lives through health technology within five years. We created a program to support this vision. When Frans van Houten became CEO, he presented this to the board, and it became Philips’ company-wide purpose: to improve 2.5 billion lives per year by 2030.”

Decisions to achieve this rely heavily on data. “At Philips, the common thread is: how do we maximize positive impact while minimizing negative environmental effects? First, you need a deep understanding, supported by data, of where your impact lies and how you can influence it. Then, you translate that into strategy and innovation.”

There are companies that have built their organization around their purpose and have also aligned their supply chain to reflect it. Is it harder to pursue your purpose as a publicly traded company rather than as a purpose-built organization?

“That depends on your goals. I’ve asked myself where I could make the most impact and what platform I needed. Joining a start-up or scale-up allows for agility and experimentation, but they’re also small-scale. A sailboat is nimbler than a cargo ship, but if a cargo ship changes course by 2–3 degrees—or even 10–15 degrees over time—it can achieve a larger impact. That’s the trade-off. For me, Philips was a perfect match. As a child, it was already a dream company for me. If we want to address the sweeping changes ahead, we need the industry—including the old industries—on board.”

Philips' focus is becoming increasingly centered on healthcare. Is there room for environmental gains in the healthcare sector?

“For a long time, environmental considerations were entirely absent in healthcare. As a result, the healthcare sector has become one of the most polluting industries. Hospitals are energy-intensive, with an average hospital generating 13 kilograms (29 pounds) of waste per bed per day. Healthcare’s CO2 emissions exceed those of the entire aviation industry. Until recently, this wasn’t widely discussed, let alone acted upon. But in recent years, awareness has grown.”

And not a moment too soon, says Metzke. “Today, half the global population lacks access to healthcare. Four billion people have never seen a doctor. That presents an opportunity. We want to ensure that everyone eventually has access to quality healthcare. Achieving that means considering not only technology but also how to make it usable and how to effectively reduce the ecological footprint per patient.”

“There’s a growing movement of frontrunners aiming to become climate neutral. The intent is there, but hospitals often don’t know where to begin or where their greatest impact lies.”

What steps can Philips take to help the healthcare sector?

“About 70% of the healthcare industry’s impact lies outside hospitals—in procurement, patient movements, and technology. Philips can contribute here. For example, energy-efficient imaging equipment directly reduces both hospital costs and radiology emissions. That’s step one. Step two is considering the indirect energy required to manufacture such equipment. Extending the life of components supports the circular economy. Refurbishment, recycling, and supplier agreements can lead to environmental benefits.”

Anyone aiming to help the healthcare sector become more sustainable must, of course, lead by example, Metzke emphasizes. “Philips' global operations have been carbon neutral since 2020, and we’ve adopted Science Based Targets for scopes 1, 2, and 3. Four years ago, we invited our suppliers to join us in this effort. Today, nearly half of our 15,000 suppliers have committed to this initiative, making our entire supply chain increasingly energy-efficient.

The third lever lies in rethinking how care can be organized more efficiently within hospitals. For instance, by leveraging artificial intelligence to reduce scan times by 50%, we can help twice as many patients with the same resources.”

Have recent global developments impacted Philips’ operations or goals?

“Since the fall of the Berlin Wall, we’ve benefited from relative geopolitical stability, but such periods are historically rare. Since the Yugoslav Wars, we’ve clearly been moving toward a multipolar world. This forces companies to become more resilient—regionalizing operations, shortening supply chains, minimizing CO2 emissions, and reusing materials. These measures strengthen resilience in a volatile world and reduce dependency on external energy sources.

“At Philips, we have our own wind farms in many regions. For me, sustainability is about understanding the trends and developments shaping the medium- and long-term future so we can continue to operate successfully as part of society.”