Philips, one of the world’s largest producers of respiratory medical devices, today announced that the company’s CEO is set to step away from his role. The news comes after the company issued a CPAP and ventilator machine recall over concerns that a type of foam inside the machines could disintegrate and release hazardous particles. The recall affected between three and four million patients and left Philips scrambling to secure new materials at a time when the global supply chain was already snarled by the pandemic.
After nearly 12 years of leading the company, CEO Frans van Houten will step away from his position, effective October 15, 2022. After an evaluation of external and internal candidates, Philips’ supervisory board has unanimously decided to propose internal candidate Roy Jakobs as the next president and CEO of Royal Philips to its general meeting of shareholders. An extraordinary general meeting of shareholders will be held on September 30, 2022, to appoint Jakobs to the role, effective October 15, 2022. Van Houten will act as advisor to the company—supporting the transition—until April 30, 2023.
“The supervisory board and current Philips CEO Frans van Houten have agreed that with the end of his third term in sight, the time is right for the change in leadership,” says a statement from Philips.
“Roy Jakobs brings a strong international, operational and transformational track record, as well as a deep understanding of Philips, which is critical at this important juncture in the company’s growth journey,” the statement says. “Since taking on responsibility for the voluntary recall notification/field safety notice for specific Respironics devices on behalf of Philips, substantial progress has been made under his leadership in the execution of the comprehensive program aimed at delivering a resolution to affected patients as fast as possible in consultation with the relevant competent authorities.”
In a release, von Houten says, “I have very much enjoyed working with so many talented and committed colleagues and building long-term relationships with our customers and other stakeholders. While I am proud of our many accomplishments, much remains to be done to enhance the resilience of Philips to manage through current setbacks and adverse market conditions. I gladly hand over to my executive committee team member Roy Jakobs in the knowledge that he brings the experience, energy, and commitment to take Philips on the path forward, with continuity for our customers and determination to improve the health and well-being of billions of people in a sustainable and responsible way. I wish Roy every success over the coming years and will support him as much as I can along the way.”
Incoming CEO Jakobs says in a release, “I aim to build on the company’s strong foundation as a purpose-driven health technology leader with deep innovation and clinical expertise, to serve the needs of patients and consumers today and in the future. I look forward to working with Philips’ teams across the world to deliver a strong value creation trajectory for shareholders and all our other stakeholders. I also want to take this opportunity to thank Frans for his trust and the great support he has given me over the years.”
Key priorities are to further deepen the quality and patient safety capability across the company, complete the Respironics field action in consultation with the relevant competent authorities, and lead Philips to resume its profitable growth trajectory by addressing current headwinds, including strengthening supply chain resilience to enable the successful conversion of the all-time-high order book into sales.