Pharmactive BioTech Products takes a holistic approach towards sustainability, aiming to support the circular economy in Spain and tackle all pillars of sustainability—environmental, social, and economic.

For this podcast episode, we cover multiple sustainability considerations, lessons learnt and insights from Marguerite Gerritson, managing director Pharmactive BioTech Products. Tune in to hear more about:

• How Pharmactive BioTech Products tackles the 3 pillars of sustainability: people, planet and profit 
• Getting certified on an environmental management system 
• Environmental policy strategies and farming plans in the remote areas of Castille-La-Mancha region of Spain
• The investment needed towards the sustainability practices versus the return of investment

Guest: Marguerite Gerritson, Managing Director, Pharmactive BioTech Products

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Welcome to the Vitafoods Insights Podcast. Join us as we explore the latest science and innovation, helping the global health and nutrition industry, connect, develop, and progress. Today's host is Natalia Franca Rocha, content producer.

Hello, and welcome to another Vitafoods Insights Sustainability Series episode. Today we'll be talking about the sustainability efforts and the programmes carried out by Pharmactive BioTech Products. I'm delighted to be joined today by Marguerite Gerritson, who is the managing director of Pharmactive BioTech Products. Thanks for joining me today, Marguerite.

Thank you very much, Natalia, for your invitation. And I'm happy to be sharing with all of you and our listeners some input about our sustainability efforts.

So, to get us started today, could you please share more with our listeners about Pharmactive BioTech Products, its sustainability programme and how it impacts the three pillars of sustainability, so, the planet, the people, and the profits?

We are a Madrid-based company, and we're designing innovative ingredients for the nutraceutical space. As we have probably have in common with many of the Vitafoods listeners, sustainability, for us, is of crucial importance. So crucial importance because not only our direct customers, all the brands, and also distributors are asking about it, but also more and more our end customers. So we clearly see a pool coming from the market about our sustainability efforts. And it has become almost a must to be able to compete and to differentiate from other players in the market, when you have a well designed sustainability initiative. So if we look at the three pillars of sustainability, people, say the environmental aspect and also the economic aspect, I would like to start first with the people aspect because any company builds up its people, the talent that we have in our organisations. So one of our key ingredients that we promote is our saffron product, as you may be familiar with, this really promotes the Spanish cultural heritage; that is where we focus on and within our sustainability effort. This is an centurie's old tradition within Spain, so our sustainability effort is actually driven to sustain that, to promote it, and also to promote social cohesion within the rural areas in Spain to keep this tradition going. At the second level, also, on the people part, we are really focused on promoting ingredients with a very strong scientific background. So we are focusing on contributing to people's health and well being all across the world. So basically, our DNA of the company is very, very much aligned with our sustainability initiative. So that really drives our R&D activities. So when we ask ourselves, what R&D are we going to focus on? What project, so, what botanicals we'll be focusing on in our pipeline? This is what we take into account: Are we able to bring on differentiating botanicals to the market that promotes the well being and health of people all around the world? So the second pillar within sustainability, of course, environmental, we source our ingredients sustainably, we focus on ingredients that are renewable. And that's the beauty of basically our business, our business is all about renewability. So, our ecological footprint, we try to keep it as small as possible, not only in the extraction for processing plants, but also in ingredients that we source. We work with farmers, the saffron fields are integrated in our supply chain. So we work with farmers to promote sustainability and regeneration of the crop. So when we hear from, for example, from consumers, that there's an increased need for ecological certification, pesticides free, etc. These trends and these things we communicate to them and we work with them to get that implemented. So as of today, from activities able to provide certificates to all our customers, for example, that highlight that we are pesticide free, that we have biological options as well. And that is something that we do with all the farmers that we work with. And lastly, we promote ingredients, in a sense that we support biodiversity. And the third pillar, the economic pillar, because yes, we are also business, it also becomes an economic imperative to focus on sustainability. Every business of course has to watch out for waste and resources, but we focus on reduction of energy and watering the plant and in our offices. We optimise our extraction processes to reduce waste and energy. But also, we try to focus on ingredients that not only offer higher margin product, but that that combined with a sustainability extract. So, if we cannot produce an ingredient in a sustainable way, most likely it's also not economically viable.

It's actually really great to hear that you taking sustainability as this holistic approach, and as a whole system, accounting for all the pillars of sustainability, considering economic, environmental, social aspects. I also know that you have certified your environmental management system. Can you share more about how that came about and the steps and paths that you followed? I mean, how could other companies develop similar roadmap?

In answer to this, I would like to stress two things, right. One is the regulatory aspect. So there are certain things that a company must comply with. But the other part is also the mission and the vision that a company has. Our company's about, today, 12 to 13 years old, so relatively young company. And when we started, it probably wasn't as pronounced as much as it is today about how important having an environmental management system was. So we started gradually, and over time, it became much more implemented in all the processes etc. So we started working with ISO, so ISO is a very common control mechanism within companies. So within ISO 14000, of course, we check for correct waste management, we measure the environmental impact of our activities, we look at the waste in our plant, etc, etc. And work, of course, with compliance about the environmental legislation as well. But that is just the, I would say, the process around it. And I think for most companies, if you want to implement that, that in a way not so hard to do; you get in contact with a consultant, you see what the requirements are, you look at your processes, and you align your activities. It takes time, it takes effort, it takes resources without a doubt. But I feel that if you are a company that wants to do that implementing an ISO certification on environmental aspect is definitely available to the majority of them. Where it becomes a little bit more trickier is the human aspect. So I mentioned to you before, the company's DNA, the company's mission, the company's vision. If not, a management system is just that, it's a paper trail, you have to live it. So I can absolutely with 100% certainty say that we live this within our company. So our team is constantly coming up through our continuous improvement projects, with new ideas to improve sustainability. What can we do? What can we ourselves, people in office, people in the plant, what can we do to make our, let's say, our environmental management system better? not only as a paper tool, but also on a day to day stuff. So if you do that, with initiatives that come from the bottom up, what you ensure is that all these activities become a whole lot more sustainable. Everybody participates, everybody contributes. And that part is a whole lot more difficult to start as a company, especially when you have to start from scratch. So my advice to companies wanting to start that is take small steps, map out where for you are your priorities, start small, and then also make sure you have a bottom up approach so that everybody can contribute.

Well, it's really great to hear about this viability that other companies can take to partake on this environmental management system. We can definitely all do our part in the industry to contribute to sustainability, so thank you so much for sharing more insights on how other companies can start. And now can you talk more about your environmental policy strategies and farming plans in the remote areas of Castille-La-Mancha region of Spain?

Yes, this is, of course, a topic of great pride and joy for us. And maybe for the international listeners who are not familiar with Castille-La-Mancha. Again, Pharmactive is based out of Spain, and Castille-La-Mancha is a region of Spain, very, very famous centuries now for the cultivation of saffron. So this is an area that is very popular for that. And this is also the area where Pharmactive, we have our own fields, we work with cooperatives and where our vertical integration comes from. So in terms of the environmental policy that we have regarding our fields and work with our cooperatives, is that we talk on a regular basis about what do these people need? What do organisations and the cooperatives need from us? especially feedback from the market to deliver a superior product. So I mentioned before in one of your questions, the feedback from the market is, it needs to be, of course, pesticide free, it needs to be ecological, etc. So we tried to be the intermediary in the sense that we translate the strengths and we communicate that to the farmers in the cooperatives in these areas, so that they can take action on that. Another topic, for example, is the reduction of water as well for irrigation purposes. Another part of our environmental policy is what can we actually do to help preserve the cultural heritage that is established there for centuries? There are many botanical species, but also plants that can be farmed industrially. Unfortunately, or maybe fortunately, in this sense, I would say it's fortunate, Saffron is a centuries old plant that is not easily cultivated. So just the fact that we are able to preserve these traditions where bulbs are planted, they're harvested in October, in November. And then mostly women, they are the ones that extract actually the stigma from it, providing this, this social and cultural cohesion. That is what we promote. So we go as a company, we support that not only with resources, but of course, also making sure that our customers sell more of this great spice. So we sustain rural communities. If you know a little bit about Spain, you know that we have a serious problem with de-population. So less and less youngsters are going into agriculture today. There is a big trend of people moving to the cities. So by helping establish a viable job, you know, economic and let's say employment in rural areas, helps to keep people there, helps to keep the young people also interested and helps them to stay within the saffron trade. So we promote the local economy because we sourced locally.

It's really nice to hear about this heritage conservation and the women inclusion promotion, as well as the employability work that you're doing this rural areas. It sounds like you're really taking approach to enhance the circular economy, and that's amazing to hear. I hope other companies listening get inspired by your sustainability work. But what about the investment needed towards the sustainability practices versus the return of investment? Could you comment on that?

Yes, I think this is important that nothing in life unfortunately comes for free, right. So we have to be willing to make an investment in these areas. But again, if that is your mission, and your DNA as a company, you make room for that, you allow for that planning an year's budget rounds to make sure that you have these funds available. So we do not treat sustainability practices as an expense, we see it as an investment. And if you take the other approach, it becomes easier to manage. We know that year over year we have certain expenses to pay or to invest. And we need to recoup that. So if we look at what these expenses are, of course, we pay consultancy fees, we pay certifications, we pay visits to the local areas. And also, of course, it's investment in time, because you're spending the effort as a company as a group of people to talk to farmers and to talk to local communities. In terms of the return of investment, of course, we measure it in additional sales. That's one thing, because we believe it's an indirect driver to be successful. So as long as we see a positive trend, let's say sales, but also in the feedback, we get a lot of feedback from consumers and from people who use our products that are happy. People have said, you know, you've really contributed to a better mental state, I sleep better, etc. Indirectly, that is also return on investment. And ultimately, Natalie, yes, we have to look at the bottom line and see, of course, at the end of the day, whatever that is for your overall business. But I think the key is do not focus on a ROI that is immediately short term. If you start to measure expenses, and then immediately return on investments on let's say on a quarterly basis, then your ROI is definitely going to be negative. However, if you approach it on a longer term, and you allow it to be, let's say, an intrinsic part of the regular annual planning and budget process, you'll see a much more positive return on your percentage.

That's actually really nice and different to hear that you take this human centric approach and consider the end consumers feedback as a measurement to return of investment. And yeah, that's amazing.

We also of course, make investments in the plants right? In a factory. And we have a patented f1 cooltech, where we only extract with water. Now that in in first instance is of course an investment. And this is something if you invest in your plants there, you have a much easier way to measure your return on investment. So there we are able to see, okay, we invested x a few years ago, but we're now able to extract with higher efficiency rate, with less waste, with less water, etc. So on those investments that are directly tied to technical equipment, or it or let's say tangible assets in the factory there, of course, it's very, very easy to measure your return. And that can also be effectively managed by a dedicated team of plant managers.

Amazing. That is definitely a lot of metrics that other companies can use to measure their impact. So thank you so much for sharing with us your insights today. And before we end the show, do you have any other final thoughts that you'd like to share with our listeners?

I would say if people walk away after listening to this podcast and after everything we've talked about, many would like to give us a last message, which I think is the heart of sustainability. If you treat sustainability as something that you intrinsically believe in as a company, or as an organisation, then you will make it happen. If you believe that sustainability, if you only do it because your customers ask for it, or you want to get a certain certification, it will be very difficult to achieve long term and again, sustainable results. So basically, my last piece of feedback to ourselves, even to us as a business, but also to other companies is think about how you feel, how your company feels about sustainability. And if you believe that it can truly benefit your overall customers, your organisation at large, then use that to drive implementation within your business.

I love the end piece of advice, it really links back to the whole idea of leading by example. So that's really great, thank you so much, once again for joining us today, Marguerite.

You're welcome, Natalia.

Thank you also to our listeners for tuning in. And if you're interested in learning more about Pharmactive BioTech Products, make sure to check out their website on the hyperlink that's available on the show notes. Bye for now and see you next time.

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