Investors witnessed an awesome display of arrogance, contempt, scorn, and derision at the annual shareholders' meeting of Home Depot (NYSE:HD) last week. The utter lack of respect for the feelings and views of the company's true owners was finally bared for all to see.

The entire meeting lasted only 30 minutes or so, and the board of directors failed to attend. There was virtually no question-and-answer period, and speakers were cut off if they went over their allotted time. Shareholder proposals were dismissed out of hand, the company's financials were not discussed, and the CEO's compensation practices were ignored. As if to twist the knife a little deeper into shareholders' backs, the company issued a memo afterwards saying that if people were offended by the way the meeting was conducted, so sorry, no offense was intended. Our bad.

It's hard to describe the waves of disgust and anger that shareholders felt at their shabby treatment. The depth to which management sunk to express its disdain for stockholders was nearly breathtaking. I don't even own the stock, and I was appalled.

What are investors to do? It was painfully obvious that CEO Bob Nardelli held nothing but contempt for those who attended the meeting. After siphoning off hundreds of millions of dollars in pay, benefits, and perks over the past six years, you would think he could at least justify that expense. He has presided over a declining share price during his tenure, while competitor Lowe's (NYSE:LOW) has tripled in value.

Just last year, Nardelli's pay package earned him $2.2 million in salary, $7 million for a bonus ($3 million of which was guaranteed), $3 million in forgiven loans, $14.7 million in restricted stock awards, $2.4 million in long-term incentive payouts, and a measly $539,000 in "other" compensation, which includes life- and disability-insurance benefits.

It's been said that management chafes at the constant comparison to its better-performing competitor. Home Depot has even announced that it will stop reporting same-store sales, an important retail metric that measures sales improvements at stores open for at least a year, because the company no longer thinks it's a valuable number to report. Could it be that sales are just so bad that Home Depot doesn't think investors need be privy to that information, either? Heck, the company wouldn't even divulge the tallies on the proposals voted on at the annual meeting -- just whether they passed or failed.

In 2002, Motley Fool senior editor Bill Mann railed at the stock options being bestowed at Microsoft (NASDAQ:MSFT), then sold the stock from the real-money portfolio the Fool ran at the time. He didn't sell because he thought the company wouldn't make money for investors. Instead, it was a principled stand against the corporate greed and arrogance involved in diluting the value of current shareholders' stock. Sometimes investors, even small ones, need to take such a stand against arrogant management.

So what should Home Depot shareholders do? Despite its selection for Motley Fool Inside Value, I cannot see why anyone should continue to hold this stock in their portfolio for one minute longer. Management and the board of directors have no use and even less concern for small shareholders. Even large institutional holders of the stock get short shrift. Home Depot has become a company run for its management's benefit, enriching executives at all others' expense. How else can one comprehend Nardelli getting a guaranteed minimum bonus of $3 million every year? How else can one understand the motives of directors who lower Nardelli's performance incentives when the company can't reach its original targets, ensuring that he still gets an additional bonus? Why would you even want to own this stock, anyway?

The only alternative is to try to foment a shareholder revolt. That's a difficult road to take. Even with the millions of shares that institutions held and voted against the current board, its members were all reelected to serve. Unless a share is specifically voted against a board member or proposal, it's often counted as having voted in favor of that measure. Thus, inaction on the part of investors can become an action against their own interests.

It took a protracted power struggle at tiny FlamelTechnologies (NASDAQ:FLML) to oust management. At a multibillion-dollar corporation like Home Depot, the effort would have to be monumental. The board of directors is stacked with Nardelli's friends and compatriots from his days at General Electric (NYSE:GE). His bud Kenneth Langone, who is also at the heart of the generous pay given to former New York Stock Exchange chairman Dick Grasso, brought Nardelli to Home Depot. There's no way these people will change things voluntarily.

When management holds shareholders in contempt, and when directors abdicate their responsibility to manage the finances of a company in a conscientious manner, it then falls to individual investors to take action. Either oust management and the board, or oust the stock from your portfolio. As Nardelli clearly understands, inaction is acquiescence. Investors can no longer afford that.

Microsoft and Home Depot are Inside Value recommendations. Flamel is a small-cap pick from Tom Gardner's Motley Fool Hidden Gems . Try any of the Fool's newsletter services with a free 30-day guest pass.

Fool contributor Rich Duprey does not own any of the stocks mentioned in this article. The Motley Fool has a disclosure policy.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.