The Home Depot (NYSE: HD), headquartered in Atlanta, Georgia, is a big-box home improvement retailer that aims for both the do-it-yourself consumer and the professional in home improvement and construction.

It is the largest home improvement retailer in the world, the second largest retailer in the United States, behind Wal-Mart, and the third largest retailer in the world, behind Wal-Mart and French company Carrefour. The Home Depot operates about 2,000 stores across North America. The company operates stores in the United States (including the 50 U.S. states, Puerto Rico, the United States Virgin Islands), Canada, and Mexico. The Home Depot also operates EXPO Design Center stores in select U.S. markets, providing high-end home design products and services, and 10 Crescent Lane, an online home-furnishings store.

History

Home Depot stores are large, averaging 109,000 ft² (10,000 m²) and warehouse-style, stocking a large range of supplies. The company color is a bright orange (PMS 165, CMYK 60M100Y), on signs, equipment and employee aprons.

The company was founded in 1978 in Atlanta, Georgia by Bernie Marcus and Arthur Blank, and grew rapidly, with sales topping $1 billion annually by 1986.

In 2000, Marcus and Blank retired. Robert (Bob) L. Nardelli became chairman, president & chief executive officer of The Home Depot. He had previously spent almost 30 years at General Electric, his career culminating as president and CEO of GE Power Systems.

The Home Depot today

Its 2005 sales totaled US$81.5 billion. Despite the 11% increase in revenue, it dropped one spot to #14 on the 2006 FORTUNE magazine's FORTUNE 500 list (it was #13 in 2005 on $73.1 billion sales in 2004). The Home Depot also owns EXPO Design Center, a chain of higher-end home decorating and appliance stores. and online home-furnishings store 10 Crescent Lane.

Corporate governance

Current members of the board of directors of Home Depot are: Greg Brenneman, Richard H. Brown, John Clendenin, Claudio González, Milledge Hart, Bonnie Hill, Laban Jackson, Lawrence R. Johnston, Ken Langone, Robert Nardelli, and Tom Ridge.

Controversies

Shareholder Controversy

At Home Depot's annual shareholder's conference [1] on May 29, 2006, in Wilmington, Delaware, many of the companies shareholders expressed anger and confusion about CEO Nardelli's pay package of $123.7 million, excluding stock option grants, over the past 5 years. Nardelli was awarded this package while Home Depot's stock sunk about 9%, and competitor Lowe's saw a 185% increase on a split-adjusted basis. While some stockholders were prepared to ask some tough and pointed questions to the board of directors, they were hindered by the fact that only one of the board's members actually showed up to the meeting, Nardelli himself. Their comments were kept to a strict time limit, displayed on a large clock. Nardelli refused to acknowledge any shareholder's comments, answer any questions, and he promptly left after only thirty minutes, causing an uproar of anger and rage. Votes on shareholder proposals afterward showed an unusually high level of dissent, with over one third withholding their support for Nardelli's re-election as CEO.

The company's "official" excuse for the absence of the board on the day of the meeting was that "many" of the directors were at headquarters over the past few days for their quarterly meeting and remain there today on company business. But directors had over a month's notice of the meeting, with the date and location of the meeting being posted on April 14th, 2006. Directors are also paid for travel expenses to and from shareholder meetings by the company, with full access to a corporate jet.

Home Depot stock has sunk further since the debacle, from about $43 a share in April to just under $37 a share in early June.

Illegal Drugs Found in Merchandise

Recently, there have been several cases where illegal drugs were found inside of some Home Depot merchandise from stores in Massachusetts. One customer found two fifty pound bricks of marijuana with a street value of nearly $145,000 inside a bathroom vanity that he had purchased from Home Depot. Another customer found three kilograms of cocaine and about 40 pounds of marijuana inside another vanity he had purchased. In this case the street value of the drugs was nearly $250,000. A third customer also found a large amount of illegal drugs inside merchandise he had purchased from Home Depot as well.

Searches by law enforcement at stores throughout the state of Massachusetts uncovered additional cases where drugs were found in Home Depot merchandise. Law enforcement had found that the merchandise containing the drugs had originated from Texas and were distributed to the stores from a warehouse in Massachusetts. They believed that the merchandise was supposed to be intercepted and the drugs removed beforehand, but either the person was not on duty or the packages had been mislabeled. Home Depot announced its intent to fully cooperate with law enforcement.