Thursday, June 1, 2006
News Home Depot on Air Loaf
Posted by Web Editor on Thu, Jun 1, 2006 at 3:21 PM
Thanks to a great NYT article, Home Depot's Robert Nardelli has become the national poster boy this year for a CEO-bloated salary. The Times story laid out the repulsive web of relationships that makes the Home Depot's board kind of a joke when it comes to watching out for shareholders' rather than corporate execs' interests. Later that week (this past Thursday), the Home Depot board took the unusual step of not even showing up at their shareholders meeting. Very different from the old, open, entrepreneurial culture at Home Depot.
One of the leading commentators on Home Depot has been Kennesaw State University's Paul Lapides, who happens to be an expert on corporate governance. Listen below to his appearance on Saturday's Air Loaf.
May 27 Air Loaf, first hour (10-11 a.m.):
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Home Depot: Calling Off the Dogs In the wake of shareholder outcry at the way Home Depot's annual meeting was handled last week (as I blogged about a few days ago - also see this WSJ editorial), Home Depot issued this press release yesterday noting that next year's shareholder meeting will return to "normal" (ie. shareholders will be permitted to ask questions and directors will attend). In addition, the company announced that it intends to implement "majority vote measures" since a shareholder proposal seeking a majority vote standard received support from 56% of those voting. It will be interesting to see what those "measures" comprise of given that 10 of Home Depot's 11 directors received high levels of withheld votes: over 30% (the only director not receiving a similar level is a brand new director). According to this WSJ article, these high levels are mainly due to anger over CEO pay. Depending on the math, if broker non-votes were not counted and a majority vote standard had been in place, this board might have been gone! Interestingly, Home Depot has landed near the top of the ISS CGQ scoring system in recent years (99.6% right now) - which can be taken one of two ways, either the conduct of this meeting was an aberration or CGQ scores should be taken with a grain of salt... Thanks, Broc Romanek Editor, TheCorporateCounsel.net
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