The circular imperative

Growing demand for healthcare from an expanding population, overconsumption of resources, waste, pollution, climate – all these factors are putting unsustainable pressure on our ecosystems.

At the same time, a number of global trends – e.g. the shift to value-based care, changing consumption patterns and the adoption of digital technology – are supporting the transition to a circular economy.

The circular imperative

Growing demand for healthcare from an expanding population, overconsumption of resources, waste, pollution, climate – all these factors are putting unsustainable pressure on our ecosystems.

At the same time, a number of global trends – e.g. the shift to value-based care, changing consumption patterns and the adoption of digital technology – are supporting the transition to a circular economy.

How we practice circular economy

In a circular economy, products, parts and materials are kept at their highest utility and value at all times, circulating between customers. These productive loops maintain value while minimizing waste and the extraction of finite resource reserves.

For our business, we see the move from the linear model of ‘Take › make › dispose’ to a circular model of ‘Make › use › return’ in five returning loops: dematerialize/optimize, service, refurbish, parts recovery, recycle.

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Our ambitious circular economy objectives for 2025

We have set ourselves a number of challenging targets for 2025

Generate 25% of our revenue from circular products, services and solutions

Close the loop by offering a trade-in on all professional medical equipment, and taking care of responsible repurposing.¹

Further embed circular practices at our sites² and send zero waste to landfill

¹ either refurbished at Philips, or locally recycled in line with Philips policies
² including non-manufacturing sites, such as large offices, warehouses and R&D facilities

Our circular products and services

Circular business models – such as offering customers access to, rather than ownership of, products – open up new opportunities for growth and cost savings, reduce resource risk, and facilitate smart asset management. Addressing this customer need, we offer a wide variety of circular propositions.

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Partnering to drive circularity

We collaborate closely with our customers, (non-) governmental organizations, and other stakeholders, such as the Ellen MacArthur Foundation, to drive the adoption of circular thinking. Our CEO, Frans van Houten, co- chairs PACE, the Platform for Accelerating the Circular Economy.

At the 2018 World Economic Forum, Philips announced the commitment to take back and repurpose all large medical systems that our customers were prepared to return to us by 2020.

To drive this, we started the Capital Equipment Coalition, a group of like-minded organizations, including ASML, Cisco, Dell, KPN, Damen, Lely, Enel and Vanderlande, to develop and share best practices.

In 2020 we delivered on our pledge to ‘close the loop’ on our large medical systems. For 2025, we have extended it to all professional medical equipment.

The circular imperative