Koninklijke Philips Electronics N.V.

Contents

1. HISTORY .................................................................................................................................................. 2 2. ORGA IZATIO AL STRUCTURE OF PHILIPS .................................................................................... 3 2.1 BOARD OF MANAGEMENT ................................................................................................................................... 3 2.2 SUPERVISORY BOARD.......................................................................................................................................... 4 2.3 THE RELATIONSHIP BETWEEN BOARDS ............................................................................................................... 4 3. PHILIPS’ I OVATIO STRATEGY ...................................................................................................... 4

3.1 RESEARCH IN PHILIPS .......................................................................................................................................... 5 3.2 SUSTAINABLE DEVELOPMENT ............................................................................................................................. 6 3.3 ELEMENTS FOR SUCCESSFUL IMPLEMENTATION OF INNOVATION ........................................................................ 6 4. STRUCTURAL FIT BETWEE STRUCTURE A D I OVATIO STRATEGY .................................. 8

4.1 SUPERVISORY BOARD KEEPS THE COMPANY FOCUSED ON INNOVATION ............................................................ 8 4.2 THE POSITION OF NATLAB WITHIN THE ORGANIZATIONAL STRUCTURE .............................................................. 8 4.3 LACK OF COORDINATION BETWEEN NATLAB AND PRODUCT DEVELOPMENT LABORATORIES ............................ 9 5. RECOMME DATIO S .......................................................................................................................... 10 5.1 RESTRUCTURE BOARD MEETINGS FOR...