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Nardelli staying put at Home Depot

ATLANTA - Home Depot Chief Executive Bob Nardelli said Friday he hasn't thought about leaving the nation's largest home improvement store chain amid a firestorm over his hefty pay and the company's lagging stock price, but he acknowledged the critics may be causing a public distraction.

''It's never been my intention to be a distraction for the company,'' Nardelli told The Associated Press in an exclusive interview.

Asked if he views himself as a distraction, Nardelli said, ''Certainly not internally.''

Externally?

''It is what it is,'' Nardelli said.

Asked what he can do to change the public perception of himself and his company among some investors, Nardelli said, ''I think we're doing a lot of things in our efforts to communicate. We're certainly trying to be open, we're trying to be transparent. I don't think we're doing more than we were, but we're going to keep trying to do that.''

He said that on the whole, he doesn't plan to do anything differently.

''I have worked very hard in working with my organization to make sure we stay focused, that we stay on strategy and that we stay focused on our execution,'' Nardelli said.

There has been no push for Nardelli to resign, and he noted that he maintains full support from the board.

Nardelli, who has received $123.7 million in compensation excluding certain stock option grants since becoming CEO nearly six years ago, also said he has no intention of asking his board to withhold further cash bonuses until the company's stock improves, as some critics have suggested he do. The stock is down about 15 percent since he took over as CEO despite record earnings posted by the company.

''I think it's very important that the chairman and CEO does not get involved with his or her compensation,'' Nardelli said. ''I think it's very important the chairman and CEO stays at arms length and doesn't try to influence it in any way.''

He said he thinks it's the board's decision, not his, how much compensation to give him.

''That is what they do,'' Nardelli said.

It's been a rough couple of months for Nardelli and The Home Depot Inc. following the Atlanta-based company's annual meeting in May at which Nardelli was the only member of the board to attend. Nardelli did not allow a general question-and-answer session.

He ended the meeting after only 30 minutes, without addressing concerns some shareholders raised about his compensation. The company was widely criticized afterward. While he was re-elected as chairman at the meeting, nearly a third of voting shareholders withheld their support. Only 5 percent of shareholders had withheld votes from Nardelli at last year's meeting.

A week later, Home Depot said it will return to allowing shareholders to ask general questions at company annual meetings. The company also said it will ensure that all its directors attend future annual meetings.

Nardelli said Friday the criticism, especially in the media, has been difficult at times.

''It is unsettling to get some of the negative broadbrushing that comes with the job,'' Nardelli said. ''It's certainly undeserving for the associates in the company.''

He said he's wary of some of the media coverage of the company.

''The media has certainly talked a lot about some things that certainly put us in a negative light,'' Nardelli said. ''I wish that didn't happen, but it is what it is. I'm more interested in where we're going. This is a company that certainly has a tremendously proud past, but I would like to think an even brighter future.''

Asked if he's thought of hanging up his orange apron and leaving Home Depot, Nardelli said unequivocally that he hasn't. Asked what he thinks he will be doing 10 years from now, Nardelli said, ''Selling hammers.''

For The Home Depot?

''Absolutely,'' he said.

Nardelli said no one is more aligned with the stock price than he, but he said there is not much he can do about it.

''The thing I can control is the performance of the company,'' Nardelli said. ''The stock price has many influences on it, certainly the sector, certainly the economic conditions, certainly

the perception.''

He added, ''Obviously I take the stock price and responsibility for it very seriously, but I believe over time the value of our stock will certainly be commensurate with the performance of the company.''

On other topics, Nardelli said he continues to push for customer service improvements at the company.

''The morale, the momentum, the excitement has never been I think as high as it is today,'' he said of employees.

He said the company's announcement this week that it is cutting 300 jobs at its headquarters was a tough one, but was necessary to help the company prioritize the money it is spending on store improvements.

''We're right in the sweet spot,'' he said of the company's business strategy. ''While others have withdrawn into a fetal position because of the uncertainty in the economy, we're getting more aggressive.''

He also addressed the company's expansion efforts beyond North America. More than two years ago, Home Depot announced plans to expand to China, but to date it has not opened a single store there and has not said when it plans to do so.

Nardelli insisted Friday Home Depot stores will one day be in China, but the company is in no rush.

''We're not going to do a dumb deal for the sake of backing up an announcement,'' Nardelli said.