As told to Lora Kolodny

In 2000, more than a decade after co-founding the New York City emporium ABC Home--the store that gave jumble a good name--Paulette Cole reluctantly left it. She and her husband and partner, Evan Cole, had separated. And they were increasingly at odds over whether to emphasize rapid growth (his choice) or socially responsible sourcing (her passion). She left control of ABC in Evan's hands and returned to the travel that had inspired much of her approach to the store.

Three years later, it was Evan who wanted a change. He went to Los Angeles and opened H.D. Buttercup, a furniture store that leases space to manufacturers and lets them sell directly to the public. Paulette moved back in--literally; she has an apartment on the top floor of the flagship store--as ABC's CEO and creative director.

Today, Paulette Cole wants to transform ABC into a 100% socially responsible world market. The trick, she acknowledges, will be to do it without sacrificing the company's $80 million in annual revenue, its 350 employees, or what more than one New Yorker has called the ABC magic.

My father ran this New York institution, the ABC Carpet Store on 19th and Broadway. It looked exactly the same for 20 years, all broadloom.

When I was young, I really believed the worst was to go work for my family. So I started as a waitress at age 14 and never went without a job from that point on. Instead of going to college, I assisted an established designer in New York for two years. Finally my father convinced me--for a supposed trial period--to see how I liked working at ABC.

He wanted me to understand each aspect of the business: buying, sales, the warehouse. Everything. Right away I went to Europe to visit international markets and a factory in Spain that we worked with. I didn't even speak Spanish, but I could oversee design, and make sure this big order for wool carpet we had placed came through on time.

In the middle of that, the factory workers went on strike. It was like a coup; they were locking out the owner. They wanted to make it into a cooperative. We were determined to make our order happen and keep the factory running--we couldn't lose the business and have them lose their business. It worked. The owners and workers went through mediation and the workers got partial ownership. We placed orders for years for both the workers' looms and the owner's.

I'd witnessed firsthand how you could advance a community and its economics just by doing business.

Traveling also taught me new things about design. In the States, as a people, we're too young to know how to create a home the way they do in Italy, Turkey, or Spain. But cultures of indigenous people who have done design and craft through the generations have made it a part of their whole being. They have incredible ways to create a feeling of home, and I wanted to do this in my own life.

That was my first instinct to begin importing some of this knowledge, and to take back to New York a little piece of each place I fell in love with.

Actually, I met my husband in New York when I sold him carpet! Evan Cole, when I met him, was an agent at William Morris. His side project was an eccentric little Christmas store on 52nd Street. We really hit it off, and after the sale he invited me to visit his store. Once we were married, he came to work at the family business.

Evan was a gambler with a brilliance all his own. He was a perfect balance to my father, who taught me how to be frugal, how to stay grounded, how to make a commitment about things like real estate. Evan was passionate but operational about it all. Working with him, I learned to invest in what I was feeling.

We didn't have a business plan. But around the mid-'80s, the trend of Oriental rugs, as they were called, began. Demand in the States was so strong! We started importing.

We'd be in Europe and Asia buying rugs, and we'd fall in love with other things. That's how we started with ABC Home, just bringing back antiques. If I loved it, Evan and I trusted our customer would love it. We just started to buy things. It wasn't about a plan. Eclectic was the whole thing.

Later, just like with the Oriental rugs, I realized there were no high-thread-count linens, no beautiful jacquard sateens like I found abroad. I brought some back. At first it was like, Linens have nothing to do with anything! Where are you going to put that?

This wrinkle on my forehead--I call it the linens wrinkle because that whole phase really wasn't easy. But when people started buying and kept on buying sheets, Evan and I were fully focused on ABC Home. We incorporated early on and were always separate, financially and creatively, from my father's business.

We went from rugs to antiques to linens, accessories, gifts, furniture, and lighting. The day we moved rugs from the main floor to the upstairs floors, I felt like we had arrived. We weren't a store organized by manufacturer, or pillows in aisle 5. It was a visual experience that told a story. It was more like a museum than a store.

Seeing how you could mix any colors that appeared in nature together in the home, seeing how you could mix things from Uganda, France, and Tibet in one room--that freed people who visited us to be creative, to make their homes a collection, over time, and stop worrying about "decorating," which is all about one pretty moment. The business results were that all those items sold together. It's known as cross-merchandising today, but we were breaking a lot of rules of retail. We brought the company from zero to $80 million in under a decade breaking rules.

I realized ABC's influence when I went to big mills and said, Do you have these organic fabrics? They said no, so I suggested they get informed. All of a sudden, all the mills--and then the department stores--had the fabrics. There would be a ripple effect every time we announced we were doing something. So I wanted to start trends that could make a social impact.

Evan would say, we need to be profitable, we need to grow. Growth was his agenda; it was our agenda at first. I think that's where our visions began to diverge.

"I believe that you cannot replicate the multilayered museum experience of ABC. That's the whole point."

I was all about cultural awakening, and Evan wanted to open outlet stores and create a formula to duplicate ABC elsewhere. I believe that you cannot replicate the multilayered museum experience of ABC. That's the whole point. Still, I knew that our staff needed to be led by one vision, and there were things in the world I wanted to learn and do.

We had our difficulties out of the workplace too, and separated. It was wrenching, but I left ABC Home in Evan's hands in 2000. I was sad about the diffusion of the brand. I wanted to spend a lot of time with our daughter, and to get back to travel.

During that time I joined the Social Ventures Network. They basically exist to teach entrepreneurs to address the social issues--poverty, the environment, and tolerance--through business.

By 2003 I realized that the store and its outlets were not growing in the way Evan had wanted. He had a business idea, called "manutailing," that he wanted to go and start separately. I bought his shares in 2004. I really felt it was my calling to move back to New York and take ABC on to the next level, as I see it.

Today, ABC Home has 350 employees. It isn't like I can just divest from the things that do not align with my vision, like the outlets, or some products that we now carry, overnight. There's the global community, and there's your community at work. You want to keep anyone who wants to stay, and you need to be fiscally responsible.

Nineteen percent of our volume is socially responsible. I'd love to see us at 50% in five years, 100% in a decade. But I don't know how realistic it is. A huge amount of product development needs to be done.

I look at the organic food market, at what's happened with Whole Foods. That's what we're going to bring to the home. In 10 years, you'll be able to buy a desk or a bed made by a women's cooperative in Uganda from salvaged wood as easily as you can buy an organically grown tomato today. If I can start that, and model a way that the industry can be socially responsible, then I think, I'll feel like I've really made this my own.