2018 Responsibility MasterFile - The Home Depot

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2018ResponsibilityReportA YEAR OF PROGRESS2018 Responsibility Report1

Overview2Our People2018 Responsibility ReportOur ProductsOur OperationsOur Business

CONTENTSThis Responsibility Report covers The Home Depot’s year of progress in 2017Overview0608101214CEO Letter: Living Our ValuesOur ApproachDoing Things Better Every Day2017 Highlights2017 RecognitionOur People18242628323435Diversity & InclusionLearning & DevelopmentAssociate EngagementAssociate BenefitsThe Home Depot FoundationTeam DepotThe Homer FundOur Products383944Eco OptionsChemical e PackagingSocial & Environmental ResponsibilitySustainable ForestryConflict MineralsOur Operations6062646870727476Carbon FootprintAssociate SafetySmart Energy UseSupply ChainWaste Management & RecyclingEmergency Preparation & ResponseCanadaMexicoOur Business80828486Code of ConductCorporate GovernanceData SecurityGRI Index2018 Responsibility Report3

OverviewOur PeopleOur ProductsOur OperationsOur BusinessOVERVIEW42018 Responsibility Report

RESOURCESTargets & PerformanceResources & Reports2017 Responsibility ReportCorporate Responsibility2018 Responsibility Report5

OverviewOur PeopleOur ProductsOur OperationsOur BusinessLIVING OUR VALUESThe Home Depot was founded on eight core values and a leadershipconstruct that we call the inverted pyramid, which puts customersand front-line associates first. These symbols guide our actions everyday, from how we treat our associates, customers and communities tohow we run our operations. They are the cornerstones of our uniqueculture.Throughout this Responsibility Report, you’ll see examples of howwe’re living our values by offering innovative and environmentallyfriendly products to our customers. You’ll read about how we’rereducing our energy usage and driving efficiencies throughout oursupply chain. And you’ll learn how we’re continuing our focus ondiversity and inclusion to create a great place to work and shop.A few highlights:Diversity & Inclusion: More than 50% of our new hires wereethnically diverse, and at the time of this report’s publication, weannounced an updated parental leave policy that gives six weeksof 100% paid leave to all parents, plus an additional six weeks of100% paid maternity leave to all birth mothers.Workforce Development: In 2017, we launched a pilot trades trainingprogram for separating military members in partnership with the HomeBuilders Institute (HBI) to help create the next generation of skilledtradespeople. In March of this year, The Home Depot Foundationannounced a 50 million commitment to train 20,000 tradespeopleover the next 10 years.62018 Responsibility ReportCommunity Support: We helped communities and associatesduring an unprecedented year for natural disasters. As part of the 63 million we granted overall to support our communities in 2017,The Home Depot Foundation gave over 4 million and volunteeredthousands of hours to help communities affected by catastrophichurricanes and wildfires. In addition, our employee-relief nonprofit,The Homer Fund, assisted more than 6,000 associates whoexperienced evacuations, as well as damage or loss of their homes.Environmental: In 2017, our stores used 23.5% less electricity thanin 2010. This means we surpassed our goal to reduce store energyuse 20% by 2020 — and did it three years ahead of schedule.As part of our values, we encourage our associates to beentrepreneurial, innovative and creative, and the successes you’llsee in this report are a testament to their talent and dedication.We are proud of their work, even as we look ahead with theunderstanding that there’s much more to do.Thank you for your interest in our progress and our plans forimprovement. I hope you will find this report informative, and,as always, we welcome your feedback.Craig MenearChairman, Chief Executive Officer and President

Lorem ipsum dolor sit amet, consectetuer adipiscing elit, seddiam nonummy nibh euismod tincidunt ut laoreet dolore magnaaliquam erat volutpat. Ut wisi enim ad minim veniam, quisnostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquipex ea commodo consequat. Duis autem vel eum iriure dolor inhendrerit in vulputate velit esse molestie consequat, vel illumdolore eu feugiat nulla facilisis at vero eros et accumsan et iustoodio dignissim qui blandit praesent luptatum zzril delenit augueduis dolore te feugait nulla facilisi.Lorem ipsum dolor sit amet, cons ectetuer adipiscing elit, seddiam nonummy nibh euismod tincidunt ut laoreet dolore magnaaliquam erat volutpat. Ut wisi enim ad minim veniam, quisnostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquipex ea commodo consequat. nostrud exerci tation ullamcorpersuscipit lobortis nisl ut aliquip ex ea commodo consequat.The Home Depot was founded oneight core values that guide oureveryday actions.Lorem ipsum dolor sit amet, cons ectetuer adipiscing elit, seddiam nonummy nibh euismod tincidunt ut laoreet dolore magnaaliquam erat volutpat. Ut wisi enim ad minim veniam, quisnostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquipex ea commodo consequat. nostrud exerci tation ullamcorpersuscipit lobortis nisl ut aliquip ex ea commodo consequat.Lorem ipsum dolor sit amet, cons ectetuer adipiscing elit, seddiam nonummy nibh euismod tincidunt ut laoreet dolore magna2018 Responsibility Report7

OverviewOur PeopleOur ProductsOur OperationsOur BusinessOUR APPROACHAs a retailer, we have relationships with a variety of stakeholdersinterested in how we’re running our business. Customers ask usquestions when they walk into our stores or shop with us online.Citizens contact us with concerns. We meet with shareholders andnon-governmental organizations (NGOs). We take part in industryefforts to raise awareness about the social and environmentalresponsibilities we all share.These formal and informal interactions help shape our priorities. Sodoes our regular materiality assessment, which gauges the impact ofour business. Together, they create a framework that our SustainabilityCouncil uses to measure our progress and design ways to improve.The Council, composed of representatives from different areas of thebusiness, focuses on seven key areas (see right).The Council meets twice a year and its chairman presents oursustainability strategy and activities to the Board of Directors annually.Our priorities and plans are communicated through our companystructure from leaders to associates.The process of evaluating the impact of our business is never complete.Technology, scientific developments, societal shifts and businessinnovations drive constant change. When we hear from concernedstakeholders, we take steps to educate them and monitor the issue or alterour path. We track and report on progress and set goals for improvement.We will continue to rely on our relationships with stakeholders toidentify and meet the challenges and opportunities before us.82018 Responsibility ReportAreas of FocusClimate ChangeFactory AuditsEnergy ReductionNatural ResourcesDiversity & InclusionChemical ConcernsWaste & Recycling

The Home Depot’sregular materialityassessment gaugesthe impact of ourbusiness.2018 Responsibility Report9

OverviewOur PeopleOur ProductsOur OperationsOur BusinessDOING THINGSBETTER EVERY DAYAt The Home Depot, we continually seek ways to alignour operational strategies with technology and productimprovements. It’s a smart way to do business, and it alsocreates a more sustainable world. But our sustainabilityefforts extend beyond our operations and into customers’homes. As the world’s largest home improvement retailer,we are in a unique position to source products and fosterideas that not only reduce our environmental impact, butalso help millions of customers reduce their impact.Our sustainability assessments expand in scope andcomplexity every year, yet we keep showing improvements.Our efforts help customers clean, repair, remodel and buildin ways that are better for their homes and businesses, aswell as for our planet.The Home Depot’s merchant teams work with our suppliers acrossindustries to embrace processes that have positive, lasting effects.We constantly look for ways to:Rely more onsustainable resourcesUse less waterUse less energyCut wasteReduce distributionemissionsJarvis sharesknowledge of allthings orange andgreen on THD’sGive Me an Hpodcast.102018 Responsibility ReportReduce packaging andimprove its sustainability

In 2017, we published a Chemical Strategy detailing our commitmentto reducing the indoor air quality impact of the household cleaning,paint, carpet and insulation products we sell. This year, we askedsuppliers to exclude additional chemicals from household cleaningproducts.We also reviewed our global wood-purchasing policy and addedstricter requirements for wood sourced from the Amazon andCongo basins, Papau New Guinea and the Solomon Islands. Thoserequirements will take effect Sept. 1, 2018.Our store operations team constantly strives for the complementarygoals of improving efficiency and reducing our environmental impact.We seek alternatives such as wind, solar and fuel cells to reduce ouremissions and encourage the continued development of cleanerenergy. We’re closer to our goal of leveraging 135 megawatts ofalternative and renewable energy by 2020.Every day we open our doors determined to do things better — tobuild on our business success as we reduce our company’s and ourindustry’s environmental impact and improve the lives of people in theglobal communities we influence, support and serve.Thank you for your time and interest in The Home Depot.Ron JarvisVice President, Environmental Innovation2018 Responsibility Report11

OverviewOur PeopleOur ProductsOur Operations2017 HIGHLIGHTSOur BusinessOurPEOPLEWe granted 63 millionto support communitiesin 2017Over 50%of our new hires wereethnically diverse, and morethan 34% were women2017HIGHLIGHTSOur core values and orange-bloodedculture go beyond our stores to thecommunities we serve122018 Responsibility ReportAcross the company,our associates speak30 languagesMore than 90%of store leaders beganas hourly associates

OurPRODUCTSOurWe helped customersOPERATIONSsave 79 billion23.5% lessgallons of waterthrough proper use of ourwater-efficient productsWe exceeded 35% of ourgoal to help customers save 2.8 billionin energy costs by 2020through proper use ofour productsWe eliminated enoughexpanded polystyrene (EPS)foam from our packaging to fill355 GreyhoundbusesStores usedelectricity thanin 2010We helpedcustomers recycle1.1 millionrechargeable batteriesWe reduced greenhousegases from U.S. logisticsby 310,680 metric tons, ornearly 8%, equivalent to taking66,500 cars32%of the hazardouswaste we managed wasrecycled or reusedfor energyoff the road for a year2018 Responsibility Report13

OverviewOur PeopleOur ProductsOur OperationsOur Business2017 RECOGNITIONBusinessSustainabilityThe Home Depot’s dedication to our people, customers, communtiesand shareholders earned recognition in 2017. Here are some of theorganizations that noted our progress in sustainablity, diversity andinclusion and business innovation.14ENERGY STARRetail Partner of the Year,Sustained ExcellenceInnovative Retail TechnologiesRetailer Innovation Award2018 Responsibility ReportWaterSensePartner of the Year,Sustained ExcellenceSmartWayExcellence AwardeeFast Company50 Most InnovativeCompaniesNational Retail FederationTop Retailer & Top E-retailerNewsweekGreen Ranking

Community & DiversityNational Coalition for HomelessVeterans Outstanding CorporatePartner AwardLawyers’ Committee forCivil Rights Under LawA. Leon HigginbothamCorporate Leadership AwardOmnikalTop 50 Corporationfor InclusionHuman Rights CampaignCorporate Equality IndexBest Place to Work for LGBTRecruitMilitaryMost Valuable Employerfor MilitaryU.S. Hispanic Chamberof CommerceMillion Dollar ClubMilitary TimesBest for Vets EmployerMilitary FriendlyEmployer & SpouseEmployer AwardMogulDiversity & InclusionInnovator2018 Responsibility Report15

OverviewOur PeopleOur ProductsOur OperationsOur BusinessOURPEOPLE162018 Responsibility Report

RESOURCESDiversity & InclusionMilitary Transition PortalSupplier DiversityRetool Your SchoolAssociate Resource GroupsThe Home Depot Foundation2018 Responsibility Report17

OverviewOur PeopleOur ProductsOur OperationsOur BusinessDIVERSITY &INCLUSIONStrengthening our business by embracingour differencesBy theNUMBERS92% favorablerating on commitment toemploying diverse individualsDiversity is good for our communities, and it’s good for ourbusiness. Differences in thought, style, culture, ethnicity, age,gender orientation and experience are invaluable assets. Havinga wealth of perspectives and experiences helps us make smarterstrategic decisions, connect with our customers and build aworkplace that attracts and retains talented associates.We are committed to a culture that welcomes and acceptsdifferences. For us, diversity reflects our core values. Weembrace it by integrating inclusive practices into our businessprocesses, engaging and developing associates, buildingpartnerships with diverse suppliers and supporting diversity inthe communities we serve.VALUING PEOPLE’S BACKGROUNDS GIVESYOU DIFFERENT POINTS OF VIEW.182018 Responsibility ReportDiverse associates give THD aSmall and diversebusinesses supply100,000 of our SKUsAcross the company, ourassociates speak30 languagesLearn more aboutour inclusivepractices and howthey align withThe Home Depot’score values.

Our inclusive practices —from whom we hire tothe product selection onour shelves — makeThe Home Depot a greatplace to work and agreat place to shop.2018 Responsibility Report19

OverviewOur PeopleOur ProductsOur OperationsOur BusinessDIVERSITY &INCLUSIONHiringWe understand that we succeed through people. Our diverseworkforce of more than 400,000 associates strengthens ourcompetitive advantage, maximizes shareholder investmentand benefits the communities we serve. Our workforce is moreethnically diverse than the U.S. working population, based on acomparison with U.S. Department of Labor data. We continueto make progress in our efforts to increase representationin our executive ranks. Here are some of the ways wefoster an inclusive workplace: Our chief diversity officer providesfocused leadership in developing aworkplace where all associates arevalued, respected and supported indoing their best work. We connect with veterans and their spouses through ourmilitary transition portal. More than 35,000 veteransare employed by The Home Depot. Our University Relations program recruits interns from diversebackgrounds. In 2017, more than 220 students participatedin our summer internship programs across 10 business areas. We use social media, traditional advertising in multiculturalmarkets and other outreach to target prospective associates.202018 Responsibility Report We have a section of our corporate website dedicated todiversity, and we regularly participate in local and nationalcareer fairs that attract diverse job candidates.RetentionAll employees prosper through our robust developmentopportunities and benefits, but we structure some programsspecifically to support workforce diversity. Here are a few examples: Respect training is part of all associates’ curriculum. Our StoreSupport Center leader development curriculum includesinclusion and unconscious bias training. Our Leaders Inclusion Network (Lead-IN) empowers associatesto lead inclusively by engaging and championing diverse talent.Our Women in Leadership curriculum is among the developmentalcontent available to associates under Lead-IN. Our SSC mentoring circles foster inclusion. More than half of theparticipants are female, and more than half are ethnically diverse. Tuition reimbursement includes learning other languages. Medical coverage includes transgender benefits.

DID YOU KNOW?In 2017, over 50% ofour new hires wereethnically diverse, andmore than 34% werewomen.2018 Responsibility Report21

OverviewOur PeopleOur ProductsOur OperationsOur BusinessDIVERSITY &INCLUSIONBy theNUMBERSSupplier DiversityWe provide meaningful business opportunities for minority-,veteran- and female-owned businesses, as well as smallbusinesses. More than 100,000 SKUs are provided by small ordiverse suppliers. They enable us to offer innovative productsand services, meet the needs of our diverse customer base andsupport economic growth in the communities we serve.Spotlight: Family-owned Jelmarfocuses on sustainable productsJelmar, known for brands likethe eco-friendly CLR line, hastransformed under the direction ofthree generations of the Guttermanfamily. Today, the company is a certified womanowned business led by Chief Executive OfficerAlison Gutterman, whose grandfather, father anduncle started the company in 1949.Gutterman said THD is a strong partner because we showcaseJelmar’s environmental focus. “It demonstrates theircommitment to environmental sustainability and concern forthe products they sell that impact consumers’ daily lives.”222018 Responsibility Report 6 billion spent with small and diversesuppliers in 20173,000 small and diversebusinesses amongour suppliers 18 billion spent with these suppliers overthe last three yearsWe maintain memberships, participate in trade shows andprovide sponsorship support to a number of diverse businessorganizations, including: Minority Business Development AgencyNational Center for Indian Enterprise DevelopmentNational Gay and Lesbian Chamber of CommerceNational Minority Suppliers Development CouncilNational Veterans Small Business EngagementU.S. Hispanic Chamber of CommerceU.S. Pan-Asian American Chamber of CommerceWomen’s Business Enterprise National Council

Retool Your SchoolOur hands-on Retool Your School program providescampus improvement grants to historically black collegesand universities (HBCUs) across the United States.Community PartnershipsOur local and national community partners represent thediversity of our associates and customers. To furtherThe Home Depot’s commitment to promote inclusion, developtalent and engage with diverse communities, we strategicallypartner with aligned organizations, including: 100 Black Men of AtlantaAmerican Corporate PartnersCatalystExecutive Leadership CouncilGeorgia Diversity CouncilHispanic Association on Corporate ResponsibilityHuman Rights CampaignNational Association for the Advancement ofColored PeopleNational Association of Asian American ProfessionalsNational Action NetworkNational Association of Chinese AmericansNational Urban LeagueNetwork of Executive WomenRainbow PUSH CoalitionThe Latin American AssociationThe Martin Luther King Center for Non-ViolentSocial ChangeTrumpet Awards FoundationUrban League of Greater AtlantaUnited Negro College Fund 360,00044%490awarded in 2017 for campusimprovement projectsincrease in school participation in 2017—72 HBCUs in allgrants awarded to HBCUs since the program’sinception in 2010, totaling 1.8 millionIT’S A CATALYST FOR RALLYING THE SPIRITOF THE COMMUNITY.Discover howRetool Your Schoolhelped build aneco-classroomat Florida A&MUniversity.2018 Responsibility Report23

OverviewOur PeopleOur ProductsOur OperationsOur BusinessLEARNING &DEVELOPMENTBy theNUMBERSEmpowering associates to grow with our companyMore than90%of store leaders beganas hourly associatesThe Home Depot strives to build a learning-rich workplace whereassociates and leaders are prepared to succeed, motivated toserve our customers well and given opportunities to grow. Ourlearning and development programs expand their skills andcapabilities so associates can master their roles, which ultimatelyleads to great customer experiences.We develop our associates and leaders using:Associates completed nearly E-learning: Media-rich, self-directed learning offers focused,interactive activities and actionable feedback.22 milliontraining courses in 2017T

2018 Responsibility Report 3 CONTENTS Overview 06 CEO Letter: Living Our Values 08 Our Approach 10 Doing Things Better Every Day 12 2017 Highlights 14 2017 Recognition Our People 18 Diversity & Inclusion 24 Learning & Development 26 Associate Engagement 28 Associate Bene ts 32 The Home Depot Foundation 34 Team Depot 35

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