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His book, Every Purchase Matters, just came out yesterday. We're just about to welcome him on in a minute. But first, speaking of books, as I shared at the start of the year, my 2025 book, Rule Breaker Investing, is available for pre-order now. After 30 years of stock picking, this is my magnum opus, a lifetime of lessons, distilled into one definitive guide, and each week, until the book launches on September 16th, I'm sharing a random excerpt. I break open the book to a random page and read a few sentences. Let's do it. Here's this week's page breaker preview. Three sentences from the first part of the book, and I quote, "Another podcast listener once threw me what I take as a high, high compliment. And he did it in so few words. From you, I learned the difference between trading and investing. Thank you, Art Burke. I hope this book does the same for you." That's this week's page breaker preview. To pre-order my final word on stock picking shaped by three decades of success, just type Rule Breaker Investing into amazon.com, barnesandnoble.com, or wherever you shop for fine books.

Thank you to everyone who's pre-ordered. That means a lot to me. Paul Rice is a pioneer in the global fair trade and sustainability movements. Raised with a deep sense of compassion for the poor, Paul has spent 40 years fighting poverty and environmental destruction. The quintessential social entrepreneur, this passion, led Paul to develop innovative models that harness the power of consumers and business to improve people's lives and protect the planet. Now, Paul launched Fair Trade USA, which was formerly known as TransFair USA. The year was late 1998, in a one room warehouse in downtown Oakland, California. Under his leadership, Fair Trade USA became the leading certifier of fair trade products in North America, enlisting the support of over 1,700 major brands and retailers who sell everything from coffee and chocolate to apparel and seafood. That's right.

It's not just fair trade coffee out there. By 2024, the organization and its partners had generated over $1.2 billion in cumulative financial impact for over one million farmers, workers, and their families in 70 countries worldwide. Now, Paul is the author of the brand new book, just out this week, Every Purchase Matters: How Fair Trade Farmers, Companies, and Consumers Are Changing the World. Paul last appeared on this podcast with me on November 21st, 2018. Paul, welcome back to Rule Breaker Investing.

Paul Rice: David, great to be back. Thanks for that warm introduction.

David Gardner: You bet you. Now, Ralph Waldo Emerson used to hail friends that he'd not seen for a long time with this greeting; he would say, "What's become clear to you since we last met?" So Paul Rice, what's become clear to you since we last met?

Paul Rice: Oh, wow. [laughs] So many things. I mean, one thing that has become clear to me is that this phenomenon that you and I call conscious capitalism is not a fad, and it's not a flash in the pan. It is a macro trend. It is what feels like inexorable rising tide. I see more and more companies joining in whatever way they choose to define conscious capitalism. It might be ethical sourcing, which is my sandbox. It might be how they engage with their teams, with their employees. It might be packaging, it might be energy. In one way or another, I see more and more, not just smaller brands, but big mainstream companies joining the sustainability movement, joining the conscious capitalism movement. That gives me hope for our future, David.

David Gardner: I really appreciate that point, Paul. I, from a separate vantage point, have seen the same thing. I've often said to our listeners that I think that conscious capitalism is not just a movement, it really is table stakes to compete over the next 25 years. I truly believe, I think we're already seeing it, the companies that win for everybody, their customers, of course, their employees, their partners and suppliers, the environment, the world at large. Those companies are very hard to compete with in our for profit competitive capitalistic world. I strongly agree, Paul. You're into this deeper than I have.

You and I first met at a conscious capitalism conference, but you have more experience globally than I do in these things. So I'm just very happy to hear that from you. Let's go to fair trade, obviously, a huge topic for you and for our conversation for your book. For listeners, Paul, who might be new to fair trade, or maybe they've heard the phrase, they're not exactly sure what it is and how it works, could you just briefly summarize what fair trade is and maybe what it isn't?

Paul Rice: Absolutely. I think the headline is fair trade is all about great products that are improving the lives of people and also protecting the planet. It's that simple. If you double click, fair trade is a rigorous set of standards. I mean, you're familiar with organic standards and how that works. Fair trade is a set of 200 criteria, social, labor, and environmental criteria that farms and factories meet. When they pass their annual audit, verifying that they have met those criteria, they're certified. For a year, they get to wear the fair trade certified label, and they get to sell to any one of our now 2,000 market partners, everyone from Whole Foods to Walmart, who agree to pay a premium. At its core, fair trade certified is all about a responsible and sustainable approach to production that is rewarded by the market.

David Gardner: One thing I learned from you, we learned this seven years ago in this podcast, is that it's also looked at from another vantage point, it's a better way to do foreign aid, because when the United States tries to help and that itself is under question in terms of what we're going to do or what our global responsibilities are, and I'm not taking any political sides here, I try to see every side of things. But what we're hearing right now is that foreign aid doesn't always work. Sometimes it gets picked off by the governments themselves, sometimes it goes to NGOs that may not be that efficient. Paul, you've pioneered a model where we're paying the farmers. We're overpaying them directly. That is a much more efficient way to get extra money in their hands to make better decisions for their families and their lives. Am I right?

Paul Rice: Yeah, that's right. As you know, David, my first career, as it were, was as a rural development worker. I lived in the mountains of Nicaragua for 11 years back in the day, in the '80s and '90s. I worked with farmers. I worked on a lot of very well intentioned aid funded projects that were aimed at alleviating poverty, but more often than not, those projects focused on production and productivity, like how to help a farmer double her yields on a given acre of land, which is not a bad thing, but we ignored the market.

We ignored how to help farmers plug into the global market in a way that they could capture the opportunities there. I ended up becoming pretty disappointed with international aid. It didn't feel like the most sustainable approach to alleviating poverty. I heard by accident in the summer of 1990 about fair trade, there were a couple of fair trade companies in the US, like Equal Exchange. Fair trade was really growing as a movement in Europe, and their slogan was trade not aid. Farmers don't need our charity. They just need a fair price for their hard work and their harvest. I ended up starting Nicaragua's first fair trade co-op, a coffee co-op, and we exported coffee to buyers around the world who paid us literally 10 times more. The local price at that time was 10 cents a pound. Our fair trade buyers were paying us over a dollar a pound for our coffee, and that enabled our farmers to put food on the table, to stay home, to stay on the land, to keep their kids in school.

From an international development perspective, to your point, to me, that market-based approach felt far more effective and far more sustainable, and that's what helped me pivot my mentality and my career toward fair trade and toward this notion of market linkage and harnessing the power of markets to support poor people on a journey out of poverty.

David Gardner: I love it, and it was earned, because you were on the ground for 11 years in Nicaragua. You saw through their eyes and you thought about what is a better model. When you were on the podcast seven years ago, Paul, you said a line that stuck with me. In a sense, you've just repeated it. But you said farmers aren't just looking for handouts, they're looking for markets. That trade not aid approach, I think is just brilliant. Now, that prior conversation, we were talking some about adaptation and evolution, about how the world might change, how fair trade might change. I'm curious, Paul, since it has been seven years, there was COVID, by the way, you can go there if you want. But what have you learned or what has changed about the fair trade model over the last seven years-ish?

Paul Rice: That's a great question. I love that question. I have three answers. Number 1, the business world is much more aware today than it was then, about the frailty of supply chains. Supply chain risk is more top of mind today than ever before. We saw supply chain disruption during COVID and how that wrecked havoc on companies' ability to deliver on time and with the right quality and price. When I started this journey 40 years ago, most of corporate America really didn't see supply chain security as a strategic goal. Today they do, more and more. That's really wind in the sales of the ethical sourcing movement, because one of the things we do is we make supply chains more transparent, more traceable, and more secure. I would say that's one thing that's changed significantly in my world and in general in the business world, the realization that supply chains are important and need to be future proofed.

Number 2, this conscious consumer movement, and I know we're going to talk a little bit more about that, but essentially, consumers that are looking for great products that also have social responsibility and environmental sustainability, that movement has grown without a doubt. Not just because the studies and the research shows it, but because the products demonstrated. The performance of social and environmental products or what you might call sustainable products in the market is tremendous. Fair trade products are outperforming the rest of the market in every single product category where we play. That that just speaks to this rising tide of consumer interest in products that deliver more than just product features, that deliver social and environmental. Then finally, what is eminently clear to me is that, and you just spoke to it when you referenced USAID, which is the US government's primary vehicle for supporting poverty alleviation around the world, and the current administration is shuttering that effort. Deregulation is the name of the game right now. That raises really interesting questions and opportunities for business people.

How do we pursue social and environmental value in an environment where the government is pulling back? For me, that's an opportunity for business to step into the breach. I mean, think about it. USAID is about global poverty. Well, so is fair trade. You, as a consumer, can go to the store and buy a fair trade product and through that transaction, send money to Ethiopia and India and Nicaragua and help farmers and workers there through a market-based approach. I actually think, interestingly, especially for those of us that care about the environment and climate and poverty, that this current context could bring new opportunities for business and consumers to step into the void and achieve really positive outcomes for the world.

David Gardner: That is fascinating, and also very promising. I appreciate that. I mean, positivity is something that Rule Breaker Investing feeds on, is born from, and I think is really, I learned it from Henry Ford, whose famously was purported to have said, whether you think you can or whether you think you cannot, you're right. I really appreciate, Paul, that focus on this new world, this deregulated world, in how business, which is, by the way, private sector is always bigger than the public sector, certainly in our country and many others worldwide, so we don't want to forget that, that this is a great opportunity. You threw down the phrase, of course, we're going to talk about it. I know it's in your book.

By the way, your book, Every Purchase Matters, is Just out this week. That means I haven't had a chance to read it yet, but I already know, please share any stories that you want from it, any of your favorite lines. I would love that. But I know that conscious consumerism is part of it, and you just mentioned that phrase. Let's go there for a little while, Paul Rice. You mentioned previously that it's rapidly becoming more the norm than the exception. Now, not everybody listening today has heard the phrase before, conscious consumerism. I know your book is entitled Every Purchase Matters. Paul Rice, what is conscious consumerism?

Paul Rice: It's a clunky term, and I don't know how many of us would walk around saying, Oh, I'm a conscious consumer. [LAUGHTER] But here's how the research defines it, and here's how I think about it. Conscious consumers are people like us who are curious and are increasingly reading the label on the products that we buy and increasingly being thoughtful about the impact of the products, first and foremost, on our health. Like, is this product healthy? Is it safe? But then also, is it environmentally sustainable? Is it socially responsible? Depending on whose research you believe, David, anywhere from a third to two thirds of American consumers are on a regular basis now choosing products that have sustainable attributes that have social or environmental value or impact so those are what I think of as conscious consumers. We're awakening, we're becoming more mindful, and we're awakening to the fact that the products that we choose do have an impact, either positive or negative on the world. I think there's a growing sense, a conscious consumer isn't necessarily an activist, far from it.

A conscious consumer I think of a soccer moms who don't want to do harm and don't love the idea that there may be child labor in her chocolate bar. So many exposes. Here's the thing every developing world farmer and worker has a cellphone. There are no more secrets in the global supply chain. Exposes on child labor in the chocolate industry in the cocoa fields of West Africa, exposes on conditions in apparel factories in Bangladesh. Exposes on the tomato industry in Mexico and deplorable living conditions that farm workers there. These are all mainstream articles and exposes. I think, increasingly, American consumers by the way, of all socioeconomic categories are realizing that every purchase matters that the things that we buy do have an impact. Part of my quest is to help companies make it super easy to communicate with consumers the social value and the environmental value of their products. One way we do that is through the Fair Trade certified label, which you've seen on your favorite coffee. There it is next to organic. We often show up next to organics that's very common, not required. But the groundswell of consumer interest in what we could call sustainable products or sustainability or social responsibility as expressed through products. To me, it's something that I research, it's something that I write about in the book. To me, it is my greatest source of hope for our future because it's the consumer that's rewarding the companies that are putting these products out there and that creates a flywheel of value creation for the farmers, for the environment, for the company, and for the consumer.

David Gardner: It's a win, win, win, a really key phrase for conscious capitalists and certainly for you and for me, Paul, and you've been living it. Let me ask you just practical guidance for consumers. Yeah, we do have some soccer moms listening right now. We got some soccer dads, people don't even like soccer, but they're consumers, too. Actionable advice is often what we're all looking for. I'm not an activist myself, as you appropriately said earlier, but I am somebody who would like to make a good decision. It's not always clear to me when I'm there in the supermarket or if I'm there clicking something online, therefore, resources, platforms that you might recommend or ways that I can dependably make better decisions. Obviously, the fair trade, branding and certification is one such example. Are there others? Help us out. We're just trying to muddle through and make better decisions as we buy.

Paul Rice: There are so many expressions of what I call ethical sourcing. There are so many ways in which companies today are trying to gain greater transparency and visibility into their supply chains in order to channel resources back to those farmers and workers and communities around the world and here in the US. By the way, we certify US farms as well as overseas.

David Gardner: Love it.

Paul Rice: Obviously, fair trade certification is one model of this much bigger movement that we call ethical sourcing. Organics would be another example, non GMO, rainforest alliance in the fishing industry, Marine Stewardship Council. They have a little label MSC. In the timber and paper products industry, Forest Stewardship Council or FSC, and you'll see that label. Starbucks is a great example of a company that is doing it on their own. They have their own in house program. It's called Cafe Practices. A lot of companies choose independent third party certification because that lends credibility. Independent verification is meaningful to discerning consumers, but other companies choose to do it in house, and that's better than nothing, too. I would say, in answer to your question, number one, look for the label as a consumer. I always look for the label. I want to know if any organization has certified that product then, secondly, well, OK, if there's not some independent certification, what does the company say, either on the package or on its website about how they sourced that product.

Listen, Gen Z and Millennial's index really high in this regard, both in terms of their expectations of company's performance on social and environmental attributes. But then also in terms of being willing to choose brands that buy into that and reject brands that don't. I think for me, that gives us a glimpse of our collective future. If the youth are voting with their dollars as it were, for products that resonate with their values, then that to me, gives me a sense that the business community is going to follow. A lot of companies are doing it now. I think a lot more will follow over time because they see the market going in that direction.

David Gardner: Gen Z, millennials, these new generations, the smartest, many ways, the most sensitive and really the most supported in the history of humankind. I'm certainly related to a few younger people in my life. Let's drill down on generational talk briefly, Paul. Because I'm curious, it's often said about Gen Z, millennials their sensitivity around these things. Where did that come from? Part of me says, Hey, who raised them? But we often look at them as if they're their own self created thing. Sometimes we're broad brushing, I'm not even sure if these labels are always accurate, but where do you think that degree of sensitivity came from?

Paul Rice: It's a really interesting question. I don't know the answer. I can tell you from my personal experience, I have a millennial son and a Gen Z daughter, and they are super conscious because my wife and I raised them that way. I'm going to take full credit

David Gardner: Sure. I think these generations are actually more connected than maybe journalists often with their leading headlines around generations and how different they are. I think that we're actually a lot more connected. But it doesn't make as clickable a headline, I guess.

Paul Rice: Here's a little bit more of a serious answer. I think they are growing up in an era where the conversation around climate change is much more front and center so I think there's a level of climate anxiety, as it has been called in their generation that we didn't feel growing up. I think that's part of it. I think also there's a cool factor, quite frankly. I think caring about the world has a level of coolness about it for this younger generation that when we were growing up it was [inaudible].

David Gardner: Hippies. I had a wonderful roommate in prep school, who grew his hair long and thought a lot about what are we doing with the environment? I openly cheesed him, mocked him, had fun. We loved him. He was a great guy, but it was so countercultural in the 1980s.

Paul Rice: That was me.

David Gardner: Wait, you were my roommate? I didn't know that. Paul, let's keep moving here. Well, speaking of conscious capitalism, as you well know, Paul, its first tenet is higher purpose, purpose driven companies, sometimes we might say purpose over profit. The irony, of course, is that the companies that have the most profit in most of these industries are the ones that are purpose driven. But the higher purpose of the Motley Fool, in case you didn't know this is to make the world smarter, happier, and richer. To that end, Paul, I want to ask you three questions about your new book. These questions are designed in order to help you make my listeners smarter than happier than richer. You ready? Alright, good. Let's start with my Smarter question. Paul Rice, your new book, Every Purchase Matters is now out this week. What inspired you to write it now? What's the main idea that you're most excited to share with readers?

Paul Rice: The main idea of this book is that conscious capitalism and a more responsible approach to supply chains is good for business. I don't subscribe to the notion that the business world needs to take a margin hit. They need to sacrifice profits in order to help third world farmers and workers and help protect the environment. I subscribe to Harvard, Michael Porter's theory of shared value, which is that there are models of sustainability that actually make that create new value that is shared by all the stakeholders in a supply chain. We very definitely see that in the fair trade world that companies that bring fair trade into their supply chains, see opportunities for more secure supply chains. They see opportunities to grow sales by tapping into the conscious consumer segment so fair trade is good for business. Really, that's the key insight from the book. We talk a lot about the successes and the failures of companies that are exploring ethical sourcing because it's a journey, and a lot of experiments weren't immediately successful. I think this book will be illuminating for business people and for investors who are trying to get smarter, about this whole phenomenon of global supply chains and future proofing supply chains and how to bring a more responsible approach to sourcing in a way that creates value for the business.

David Gardner: That is such a smart and important point. Obviously, fair trade, your 40 years in this area, your insights coming through. Obviously, part of what we do in books, Paul's, we tell stories. You might tell a story about a farmer, I'm sure you do tell stories about your experience of the world. Could you share with us a story that connects with what you just said? Can you illustrate the point?

Paul Rice: Absolutely. I have the privilege of working with so many amazing companies, and one of them is a tomato company called NatureSweet. You've probably seen this unique packaging at the store.

David Gardner: By the way, Paul, since this is an audio podcast, Paul is holding up a really interesting I have not seen that packaging.

Paul Rice: Where do you shop?

David Gardner: Actually, it's more that my wife shops at Whole Foods. She's a Trader Joe's fiend in the best way.

Paul Rice: Your wife has definitely seen this at Whole Foods.

David Gardner: You bet. We're looking at little cherry tomatoes.

Paul Rice: This company, NatureSweet has farms in Mexico. They grow tomatoes. They're one of the largest brands selling in the US. They sell at Whole Foods, they sell at Walmart, they sell everywhere. NatureSweet joined our cause a few years ago and one of the things that they noted after they joined fair trade was the increase in worker retention on their farms. Now, labor and labor shortages is on everyone's mind in the agricultural sector here in the US and abroad so anything that helps you retain your workers is good for your business. NatureSweet reported that their labor retention last year was eight times the industry average. In other words, workers are not leaving at the end of the harvest they're staying. That means that NatureSweet is spending less money on recruiting new workers. They're spending less money training new workers. They have higher productivity because it's a more experienced workforce so there's real value in fair trade for that farm. Why are the workers staying?

Because they're getting a premium. They're getting better wages. They're getting more dignified treatment. They have better benefits. That is the fair trade standard. One of their buyers was Walmart and Walmart in conversation with them, said we want suppliers that are more reliable. We're looking into the future and the ability of suppliers to meet our growing demand. We want to make sure we are sourcing from farms like NatureSweet that have stable production, access to labor when they need it. There was a beautiful conversation between Walmart, NatureSweet, and Fair Trade USA around the value that's being created not just for those farm workers, but also for the companies. The farm workers, you want to know what they did with the extra money? The flat premium in tomatoes is $0.02 a pound. That's all it is, which doesn't sound like much, but on millions of pounds, we're talking about hundreds of thousands of dollars a year so the workers get to decide how that money is spent. On the NatureSweet Farms, last year, the workers did a participatory needs assessment.

They looked at health, education, all of the different needs. They came up with two key areas where they wanted to invest this premium last year. The first one indoor plumbing. I grew up hearing stories from my mom growing up on a farm in Oklahoma, and when she was a kid, they had an outhouse they did not have indoor plumbing. I'm just two generations away from that reality. In farms in Mexico today, most workers' homes don't have indoor plumbing they use an outhouse. Workers on the NatureSweet farms use the money to build bathrooms, to have toilets in their homes. A dramatic improvement in sanitation and in quality of life. The other thing they did, they bought healthcare insurance for their families. The farm owners were covering healthcare insurance for the workers, but that didn't cover the family. They bought health insurance for the families so that their kids could have access to timely medical treatment when they needed it. Sometimes we take these things for granted access to healthcare, access to a toilet. But in so much of the developing world, these things are still not accessible for people and that's the transformation that you and I can make every time we go to the store and buy this brands tomatoes.

David Gardner: Again, as the person who doesn't do the grocery shopping in my household, I do want to say, underneath that alluring see through zigarot like packaging with little tomatoes inside, who could possibly have understood the real story of what's happening and what that's doing for people. Paul, thank you. That's beautifully illustrated. That was my smarter question. Let's go to my happier question. Paul Rice who would you most want to read your book? This is a two part question. First, who do you most want to read Every Purchase Matters? Then what positive outcome would you love to see as a result of their reading it?

Paul Rice: This book is the untold story of the Fair Trade movement of the ethical sourcing movement as told through the voices of its leaders. I interview Doug McMillon, the CEO of Walmart. I interview John Mackey, the co founder of Whole Foods. I interview luminaries and people that I think of as pioneers in this new chapter of capitalism that some of us are calling conscious capitalism and in this movement of ethical or responsible sourcing.

The book is chock-full of insights from these luminaries, as told by them. It's the story told by the protagonists themselves. I think anyone involved in business, business leaders, and investors will find this book particularly interesting because they're going to learn the views of these leaders about this whole phenomenon of sustainability. I'm sure there are skeptics among our listeners who just think sustainability is a waste of time or who subscribe potentially to the trade-off mentality that dominated business thinking in the past. The trade-off mentality was either as a business, I can be sustainable or I can be profitable and maximize profits, but I can't be both. Many business people felt like their job was to maximize returns for shareholders. That whole social responsibility, sustainability nonsense, maybe a little bit on the side, to look good, but not part of the core business model and I think that is evolving.

I certainly see that in my interactions with, again, everyone from Doug McMillon to John Mackey, Libby Wadle, CEO of J Crew, so many companies have embraced this notion that sustainability can actually be a driver of success of the firm. I think we're in a process of evolution where our readers, whether it's an investor, a business leader, or an everyday consumer will find real insight and joy in the notion that we all can make a difference in terms of how we approach business, how we approach supply chains, and how we approach our everyday purchasing decisions.

David Gardner: Yes, sir. We've done the smarter, we've done the happier, we're about to do the richer question. You're anticipating that a little bit, but I want to stick for one sec with the skeptics and a skeptical point of view, because obviously, they're out there, and I love it when we speak to them. A lot of people are skeptical that they should ever buy stocks directly. That's what the Motley Fool stands for is buying this stock, not that one, not just mailing it in and buying everything, although indexing is perfectly fine, and we've taught a lot of people how to index as well. But there are skeptics that you should actually buy Walmart stock instead of just a fund. Some of the skeptics, Paul, in and around fair trade or as you would say, ethical sourcing, wonder about its scalability. I'm just curious how you think about that. It might be all very well in this country, in this context, but does it really scale beyond where it is today? Offer some thoughts, please.

Paul Rice: Yeah, the scale is there already. If we look at how the organic movement, organic produce has grown over the years, if we look at how fair trade is growing over the years, if we look at sustainable products writ large, it's clear that this is increasingly a mainstream phenomenon. It's not just whole foods anymore. You can get fair-trade chocolate at Walmart. It's actually a private label. Walmart itself is saying, We believe in this so much that our private-label chocolate is going to be fair trade. Sam's Club, 100% of Sam's Club private label coffee members mark is fair trade certified. Costco, biggest fair trade coffee program in the world. We're not talking about food co-ops and whole foods anymore.

We're talking about mainstream retailers buying into fair trade and many other expressions of conscious capitalism or sustainable products. For me, that points to the scalability. Now, is it happening fast enough? Not for me. No. Obviously, you know, what I think about a lot, David, is how do we pick up the pace of change? How do we pick up the pace of this whole movement of products that make a difference? One of the things that Fairtrade is working on is how to bring down the cost so that we can scale, even in an inflationary environment where consumers are rather sensitive. I interviewed John Mackey for the book, and one of the things that John says is, Consumers are willing to pay a little bit more for things like organics and Fairtrade, and they should. That means it's going to be a niche, but it can be a huge niche. That's John's perspective. I share some other perspectives that are quite different. It's a really interesting debate. Like ultimately, who pays for sustainability? Does the consumer pay? Does a company pay and take a margin hit or can a company achieve value creation through sustainability in a way that it can offer sustainable products to a consumer at the same price, but not take a margin hit? That's the sweet spot, when there's enough either volume growth or supply chain value creation that a company can pay a little more to the farmer and not charge the consumer more for the product. That's where we are in the Fairtrade movement right now, really dialing in those kinds of examples. I don't know if you're familiar with E.L.F. Beauty. I hope you pick their stock because.

David Gardner: We are. It is a Motley Fool stock pick. A lot of people listening probably do own some ELF in their portfolio.

Paul Rice: Elf Beauty is the second-largest beauty company in America. They joined our cause two years ago. They're already 85% Fairtrade, and 85% of all their assortment now is Fairtrade certfied.

David Gardner: Great example.

Paul Rice: They're on fire. They chose not to raise the price to the consumer when they went Fairtrade certified. When I asked Taragaman the CEO, who's a dear friend, how do you make that work? You're paying more back to the workers in those factories. Does that mean you're taking a margin? He said, No, absolutely not. Margin is a function of volume. This is helping us grow our volume. We're better off and more profitable for things like Fairtrade. They're also doing cruelty-free. They're doing clean certified, and they feel like these additional attributes are turbocharging their brand and the success of the company.

David Gardner: Really a spade of examples you just gave us around scalability. Thank you, Paul. ELF, eyes, lips, face for those dudes like me who wouldn't have known. It's an acronym. But it is a very successful company. Great to hear of your relationship with them, and I'm sure you've accelerated their growth. Speaking of accelerating, I'm going to accelerate us toward an end for this fantastic conversation. I still have that one more question about Richer. We're going to get there. Then you've graciously consented to play my buy, sell or hold game, so we'll close with that. Let's do it. Paul, let me ask my Richer question. You've spoken to us a little bit already, but there are lessons in your new book, not just for conscious consumers or for people thinking about our world at large, but specifically for business leaders or investors. We have a lot listening right now that we can apply, maybe even today. For those interested in, let's say, sustainable investing or responsible business practices, what lessons one or two of your favorites from your book that we can all put into play in our professional or investing lives right now?

Paul Rice: Brother, I would suggest that if you're smarter and happier, you're already, richer. It's that simple.

David Gardner: That's a mic drop moment, by the way.

Paul Rice: What more do you want? You're smarter and you're happier. What more do you want? I'm already richer. But if we're talking about financial wealth, here's the thing. I've already alluded to it, I believe that responsible business is our future and a lot of companies are experimenting with this, learning and delivering. I think smart investors are already betting on the socially responsible companies. When I say socially responsible, that's Walmart too. We're not just talking about Ben & Jerry's and Patagonia. We're talking about Walmart. We're talking about mainstream industry. That's saying profits and purpose go together. This is a mainstream concept now and if you're not investing in it yet, you will be.

David Gardner: Really well said. You and I talked offline ahead of time, this interview just about how I think conscious capitalism table stakes to be successful over the next 25 years and responsible business. These phrases all mean the same thing in the end, whichever ones we choose to use. I really appreciate that. Paul, you have throughout this conversation, made me and us smarter, happier. Yeah, I agree with your point about richer and thanks. That's like Motley Fool Branding you helped us with a mic drop moment for me on my podcast by Paul Rice. Before continuing my conversation with Paul Rice, I want to put in a quick plug for The Motley Fools Breakfast News, something I wake up to every day. You can start your day too with the Motley Fools free daily market email newsletter, our Breakfast News. Daily expert Market Analysis and company updates sent straight to your inbox every weekday at 7:30 A.M. Eastern. You can sign up for The Motley Fools Breakfast News @www.fool.com/breakfastnews. Now back to my interview with Paul. Let's play buy sell or hold to close, Paul. These are not stocks. These are things happening in our world at large. I'm just asking you in brief, few sentences for each. If they were stocks, would you be buying right now, selling or holding and why? You ready?

Paul Rice: Yeah.

David Gardner: Well, we did some generational talk earlier. Often, when we talk conscious consumers, it's all about the millennials, Gen Z, etc. But I want to ask you, Paul, buy sell or hold your generation, the Baby Boomers.

Paul Rice: That's a hold.

David Gardner: Why?

Paul Rice: Boomers are spending. Gen Z may have the values and the desire, but they're not spending the way boomers are. I think more and more boomers are realizing we screwed up the planet, and we have a chance before we die to help make things right. I think our generation actually has a big role over the next 10 years, over the next 20 years to support this meta movement of sustainability.

David Gardner: Really well said. Thank you. As somebody who is Gen X myself, I won't ask about my generation, but again, I think these divides are overrated. I think there's a lot more consonants and overlap than journalists would allow us to have. My second buy, sell or hold for you, Paul Rice. Amazon's climate pledge friendly badging. Are you buying, selling, or holding?

Paul Rice: Buying. We've done a lot of work with them. I have a lot of inside understanding of that program and how it works and the judgment that they bring to products, to brands, it's very rigorous. It's legit. They are all in promoting that and making it super easy for Amazon shoppers to very quickly find products that are sustainable. That's going to grow. Fairtrade is a small subset of that overall profit pledge friendly program. I would definitely say bet on that because it's got the backing of one of the biggest, most successful companies around.

David Gardner: I'm really happy to hear that. As a mere consumer. I'm never quite sure what to think or who to trust here. It does occur to me, Paul, when we buy things electronically, e-commerce, there's an opportunity to click on something. I can't do that in the grocery store, but I can click on something and right away, see is this a legit certification? What is this thing? I think Amazon could play a great role in simplifying and bringing together multiple, it's complex out there, certifications in a way that could have us understanding. Maybe with a simple letter grade or a number, if you were to blend five different rating systems together, there's an opportunity at a huge scale to make us smarter, happier, and richer and win for everybody and everything. I'm glad to hear. Amazon, by the way, the climate pledge friendly badging is not a stock, but Amazon, by the way, I own some, is a stock, so there is an opportunity there. Let's move to just a few more for you, Paul Rice. This one's I don't know. Let's go with slightly Zany. We're going to get Zanier and a sec, but the return of the shopping mall, we're seeing artisanal market reinventions. There's ethical pop ups. The return of the shopping mall, buy sell or hold.

Paul Rice: Buy. We want a place. We want interaction. We're tired of being stuck at home.

David Gardner: Clicking on things on Amazon. [laughs]

Paul Rice: Again, I look to my kids for insight so often, and my son's 33, my daughter's 25, and they want to get out of the house. They both work remotely, and they're cooped up inside all day, and they they are increasingly looking for places to go, including where to shop. It doesn't mean they're going to stop shopping online, but they enjoy and want explore the world of shopping in person again.

David Gardner: In public places.

Paul Rice: Yes, exactly.

David Gardner: Convening.

Paul Rice: Exactly.

David Gardner: I love it. Just two more for you, Paul. This one is home cooking. One of my Rule Breaker Investing portfolio principles. I put this out there. By the way, you have to say strong buy on this one. I'm just letting you know ahead of time. I put this out there as principle number 1 for anybody building an investment portfolio. This line, make your portfolio reflect your best vision for our future. That's Rule Breaker portfolio principle number 1, if it were a stock, Paul Rice, are you buying, selling or holding?

Paul Rice: I'm buying, are you kidding?

David Gardner: That's a strong buy, my friend. This was the softball.

Paul Rice: [laughs] Of course, I'm going to buy, off course, I'm going to invest in the world that I want to create. Just as every purchase matters, every investment matters. Every vote matters. Everything we do is an opportunity to participate in the creation of the world that we aspire to. Hell, yeah, I'm buying.

David Gardner: I knew you would, and it really is fun. I don't know that we will co-write this book together in future, Paul. But when you say every purchase matters, I, of course, think about purchasing stock. There really is so much overlap between being intentional with the decisions we make with our money. That includes, of course, your portfolio. But the reason that I have to put that one out there is because many people don't think that way. They give their money over to somebody else who's like, Just don't lose it for me, that thing. There's a disconnect for many of us between the dollars we've saved over the course of our lives, which in some ways is sacred. It's like the sum total of everything you built up toward and saved, and then where you would put that or how you would invest that. Of course, you and I see eye to eye. Let me ask you one more. This is the last one. Buy, sell or hold. You ready, Paul? Buy, see or hold if it were farmers' markets as first dates. Buy, sell or hold.

Paul Rice: As a first date?

David Gardner: Yeah.

Paul Rice: No, it's a terrible idea. Unless you're wearing Tie Dye Birkenstock I reckon most of your listeners are not wearing Tie Dye Birkenstock. No, sell that.

David Gardner: Nothing says romance like organic carrots and small batch honey. Come on. We'll leave it right there. Paul Rice, you've been very generous with your time and your insights. A delight to reconnect with you. We're excited about your book. Just out this week, Every Purchase Matters, and I want to thank you for joining us on Rule Breaker Investing and say Fool on, my friend.

Paul Rice: Fool on, David. Thank you so much. It's great to see you again and a big shout out to all of your listeners.

Mary Long: As always, people on this program may have interest in the stocks they talk about. The Motley Fool may have formal recommendations for or against. Don't buy or sell stocks based solely on what you hear. Learn more about Rulebreaker Investing @rbi.fool.com.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. David Gardner has positions in Amazon, Starbucks, and Walmart. Mary Long has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Starbucks, Walmart, and e.l.f. Beauty. The Motley Fool has a disclosure policy.

Every Purchase Matters, With Fair Trade USA's Paul Rice was originally published by The Motley Fool