Edward P. Decker
HOME DEPOTAbout Edward P. Decker
Edward “Ted” P. Decker is Chair, President and CEO of The Home Depot (director since 2022; age 62). He became CEO in March 2022 and was elected Chair effective October 1, 2022, after more than two decades at the company spanning operations, merchandising, finance, and strategy; earlier roles include senior positions at Kimberly‑Clark and Scott Paper . Under his leadership in fiscal 2024 (53 weeks ended Feb. 2, 2025), Home Depot delivered net sales of $159.5B, operating income of $21.5B, and ROIC of 31.3% while returning $8.9B in dividends; 1‑, 3‑ and 5‑year TSR were 18.8%, 21.3% and 103.8% respectively .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| The Home Depot | Chair of the Board | Oct 2022–Present | Combined Chair/CEO structure; Board oversight and strategic alignment . |
| The Home Depot | President & CEO | Mar 2022–Present | Enterprise leadership; capital allocation; Pro ecosystem expansion (e.g., SRS acquisition) . |
| The Home Depot | President & COO | Oct 2020–Feb 2022 | Led global store ops, sourcing, supply chain, outside sales/service, real estate, merchandising, marketing, online . |
| The Home Depot | EVP – Merchandising | Aug 2014–Oct 2020 | Merchandising strategy, vendor management, in‑store environment, marketing . |
| The Home Depot | SVP – Retail Finance, Pricing Analytics, Assortment Planning | Oct 2006–Jul 2014 | Retail finance and analytics capabilities . |
| The Home Depot | VP / SVP – Strategic Business Development | Nov 2002–Sep 2006 | Corporate strategy and asset development . |
| The Home Depot | Director – Business Valuation (joined 2000) | 2000–2002 | Strategic valuation foundation . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Kimberly‑Clark; Scott Paper | Strategy, business development, finance, treasury (various roles) | Pre‑2000 | Pre‑Home Depot career in consumer products . |
| Other U.S. public boards | None | N/A | No other U.S. public company directorships in past five years . |
Fixed Compensation
| Metric (CEO) | FY 2022 | FY 2023 | FY 2024 (53 weeks) |
|---|---|---|---|
| Base salary ($) | 1,369,712 | 1,400,000 | 1,426,923 (includes extra week) |
| Target annual bonus (% of base) | 200% | 200% | 200% |
| Actual annual bonus ($) | 2,848,936 | 2,290,880 | 2,743,532 |
Notes: Mr. Decker requested his base salary be maintained at $1.4M for fiscal 2024; unchanged since his March 2022 CEO appointment .
Performance Compensation
Annual cash incentive (MIP) – Fiscal 2024 design and results (Company-wide)
| Measure (weight) | Threshold | Target | Maximum | Actual used for payout | Payout vs target |
|---|---|---|---|---|---|
| Sales (40%) | $139.39B | $154.88B | $170.37B | $153.37B (MIP basis) | 98% overall (CEO award $2,743,532) |
| Operating Profit (40%) | $19.62B | $21.80B | $23.98B | $21.42B (MIP basis) | 98% overall |
| Inventory Turns (10%) | 4.10x | 4.55x | 5.01x | 4.71x (MIP basis) | 98% overall |
| Pro Strategic Goal (10%) | n/a | Increase managed account sales | n/a | Achieved | 98% overall |
Design notes: Operating profit threshold must be met for any MIP payout; FX/acquisition and other specified adjustments apply; no positive discretion; Pro goal pays 0%/100% subject to OP threshold .
Long-term equity – structure, metrics, grants, and vesting
| Component | Weight | 2024 grant details | Metrics and vesting |
|---|---|---|---|
| Performance Shares | 50% | Target 14,307 sh; threshold 3,576; max 28,614 (granted 3/20/2024) | 3‑yr average ROIC (50%) and Operating Profit (50%): Threshold 85% pays 50%; Max 115% pays 200%; cliff after 3 years; dividend equivalents accrue . |
| Performance‑Based Restricted Stock | 30% | 8,584 sh (granted 3/20/2024) | Forfeitable if FY24 OP < 90% of MIP target (met); then time‑vests 50% at 30 months and 50% at 60 months; dividends accrue until performance met . |
| Stock Options | 20% | 22,976 options @ $384.41 strike (3/20/2024) | Vest 25% on each of the 2nd–5th anniversaries; 10‑year term; no repricing without shareholder approval . |
Performance status: 2024‑2026 PSUs tracked between target and max after year one . The 2022‑2024 PSUs paid at 25.6%; Decker earned 4,414 sh (including dividend equivalents), valued at $1,818,865 at FY end .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Stock ownership guideline | 6x base salary; Decker at 34x as of Mar 7, 2025 (in compliance) . |
| Beneficial ownership | 248,440 sh beneficially owned; 133,023 options exercisable within 60 days . |
| Ownership vs shares outstanding | 993,928,163 sh outstanding (Mar 24, 2025) → Decker’s beneficial ownership ≈ 0.025% (our calc using cited figures) . |
| Vested vs unvested highlights | Multiple unvested PBRS/PSUs/options outstanding (see outstanding awards table); 2024 PBRS vests 50%/50% at 30/60 months; 2024 options vest 25% annually years 2–5 . |
| Hedging/pledging | Prohibited for Section 16 officers and directors; no pledged shares reported . |
Insider selling/vesting flow indicators:
- FY 2024 option exercises: 35,987 sh exercised; value realized $9,085,401 .
- FY 2024 stock vested: 25,085 sh; value realized $9,383,771 (includes tax withholdings on non‑forfeitable restricted stock becoming non‑forfeitable) .
- Scheduled future supply: 2024 PBRS two-tranche time vesting (30/60 months post‑grant), and 2024 options vesting annually in years 2–5 may create periodic liquidity windows .
Employment Terms
- Status and term: At‑will employment (offer letter basis) .
- Severance: No severance entitlement on termination; only vested plan benefits .
- Non‑compete/Non‑solicit: Post‑termination restrictions of 24–36 months apply .
- Change‑in‑control: No CIC agreements; “double‑trigger” equity acceleration (termination without cause within 12 months post‑CIC) for awards since FY2013; no outstanding single‑trigger equity left (legacy awards vested) .
- Retirement eligibility: Age 60+ with 5+ years service → equity becomes non‑forfeitable but remains subject to time‑based vesting/settlement; Decker is retirement‑eligible .
- Clawback: Mandatory restatement recovery plus discretionary recoupment for knowing/intentional misconduct causing financial or reputational harm .
- Perquisites: Required to use company aircraft when practicable, including personal travel; no tax gross‑ups; legacy death‑benefit‑only program provides $400,000 death benefit (for legacy eligible execs) .
Board Governance
- Board/role: Combined Chair and CEO; independent Lead Director (Gregory D. Brenneman) with robust authorities (agenda approval, executive sessions, shareholder liaison, etc.) .
- Committees: All standing committees (Audit, LDC/Compensation, NCG, Finance) are fully independent; Decker does not serve on committees .
- Attendance: Board met 13 times in fiscal 2024; each incumbent director attended ≥75% of Board/committee meetings; all incumbents attended the 2024 annual meeting .
- Independent chair proposal: Shareholders have repeatedly voted down an independent chair proposal; in 2023, 73% voted against; Board argues flexibility and strong Lead Director oversight justify current structure .
- Director independence: All directors independent except Decker .
Compensation Committee Analysis, Peer Benchmarking, and Say‑on‑Pay
- LDC (Compensation) Committee: Independent; members include Chair Wayne M. Hewett, Stephanie C. Linnartz, Caryn Seidman‑Becker .
- Consultant: Pay Governance LLC serves as independent advisor; no conflicts; provides market data and design input .
- Benchmarking: CEO compensation considered vs two references—Fortune 50 and top retail peers (AMZN, COST, WMT, LOW, TJX, TGT, ORLY, AZO, ROST, KR); HD market cap ranked ~80th percentile (Fortune 50) and ~82nd (retail peers); CEO target total comp ranked ~8th percentile (Fortune 50) and ~30th (retail peers) for 2023 benchmarking .
- Say‑on‑Pay: 2024 support ≈93%; committee maintained overall structure and continues shareholder engagement .
Director Service, Roles, and Dual‑Role Implications
- Board service history: Director since 2022; Chair since 2022; President & CEO since 2022 .
- Committees: None (as a management director) .
- Independence: Not independent (as CEO) .
- Dual‑role implications: Combined Chair/CEO structure concentrates authority but is counter‑balanced by a strong Lead Independent Director role, independent committees, and regular executive sessions; investors have repeatedly rejected an independent chair mandate .
Compensation Structure Insights (alignment, risk, and design)
- Mix and at‑risk pay: ~90.8% of CEO target comp variable; 100% of annual cash incentive and 80% of equity tied to pre‑set performance goals .
- Metrics and rigor: Multi‑metric MIP (Sales, Op Profit, Inventory Turns, Pro growth) with threshold and caps; PSUs use multi‑year ROIC and Operating Profit with symmetrical curves and FX/acquisition/pandemic adjustment guardrails; no upward discretion .
- Vesting horizon: PBRS (30/60 months) and options (years 2–5) extend retention horizon; PSUs cliff‑vest after 3 years .
- Risk mitigants: Expanded clawback includes reputational harm; anti‑hedging/pledging; robust ownership and retention guidelines; annual compensation risk assessment .
Related Party Transactions and Red Flags
- Related party transactions: None requiring disclosure since the beginning of fiscal 2024 .
- Red flags observed/mitigants: No tax gross‑ups; no CIC agreements; no hedging/pledging; say‑on‑pay support strong; combined Chair/CEO draws periodic governance scrutiny but counter‑measures in place .
Performance & Track Record
- Fiscal 2024 performance: Net sales $159.5B; operating income $21.5B; net earnings $14.8B; ROIC 31.3%; operating cash flow $19.8B; dividends $8.9B; share repurchases $0.6B (paused in March 2024 for SRS acquisition) .
- Strategic initiatives: Acquisition of SRS Distribution to accelerate Pro growth; continued investments in interconnected retail and new stores .
- TSR: 1‑, 3‑, 5‑year TSR of 18.8%, 21.3%, 103.8% through fiscal 2024 .
Multi‑Year Financial Context
| Metric | FY 2022 | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|---|
| Revenues ($) | 151,157,000,000* | 157,403,000,000* | 152,669,000,000* | 159,514,000,000* |
| EBITDA ($) | 25,902,000,000* | 27,014,000,000* | 24,936,000,000* | 25,287,000,000* |
Values marked with * retrieved from S&P Global.
Director Compensation (for Decker)
Not applicable; Decker is an employee director (non‑employee director compensation is disclosed and paid only to outside directors) .
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑Pay 2024: ~93% approval; ongoing engagement with large holders (~44% of outstanding shares targeted for outreach in fiscal 2024) .
- Response: Enhanced disclosures (e.g., clawback expansion to reputational harm), dedicated sustainability/HCM disclosure page; monitoring evolving practices .
Equity Grant & Vesting Schedule Highlights (Potential Selling Pressure)
- 2024 PBRS: 8,584 sh; vests 50% at 30 months and 50% at 60 months post‑grant (performance condition met) .
- 2024 Options: 22,976 @ $384.41; vest 25% annually on years 2–5 (potential incremental exercise windows) .
- PSU cadence: 2023‑2025 and 2024‑2026 cycles; 2022‑2024 paid 25.6% (4,414 sh earned) .
Investment Implications
- Pay-for-performance alignment is strong: heavy weighting toward performance equity (PSUs) tied to ROIC and operating profit, multi‑metric annual plan (Sales/OP/Turns/Pro), and longer vesting horizons that favor retention and long‑term value creation .
- Governance watchpoint: Combined Chair/CEO persists; however, robust Lead Director role and independent committees plus repeated shareholder rejection of an independent chair proposal mitigate near‑term governance risk .
- Trading signals: Known vesting cadence for PBRS (30/60 months) and options (years 2–5) may create periodic supply; FY 2024 realized exercises/vests were sizable; monitor 30/60‑month PBRS tranches from 2023/2024 grants and option vesting run‑rate for potential selling pressure .
- Retention risk appears low: Retirement‑eligibility makes awards non‑forfeitable, but time‑based vesting/settlement continues; ownership far exceeds guideline (34x vs 6x), and anti‑hedging/pledging plus clawback dampen misalignment risk .
Block quotes of key figures:
- “Approximately 90.8% of our CEO’s target compensation for Fiscal 2024 was at risk” .
- “Our one‑, three‑ and five‑year TSR was 18.8%, 21.3% and 103.8%, respectively” .
- “We do not have any change in control agreements” (double trigger only for equity) .