Next Thursday, for the seventh time, I am going to Omaha,
Nebraska, for the Berkshire Hathaway annual meeting. But this
is the first time that I find myself respecting
Mr. Buffett a little bit less than the year before.
One of Berkshire Hathaways largest and oldest stock
holdings, Coca-Cola Co., held a proxy vote yesterday, and its
management clearly decided to award itself too much stock.
Warren Buffett acknowledged in an interview that he is against
the plan: We do not believe it would be consistent with
Berkshires long-ingrained culture to support such a plan
at any of your equity holdings.
However, instead of expressing with his proxy ballot what he
really feels, he abstained from voting against the plan, and
explained: I could never vote against
By failing to vote against something that was clearly wrong,
Buffett, who in my mind (until yesterday) used to be a moral
compass for corporate America, became another middling American
politician the common type that all of us respect so
little, the one that votes not for what he believes in but for
what is going to keep him in the good graces of his party or
get him reelected.
When your company owns 10 percent of another company (even
if it is Coke), there is a responsibility that comes with the
investment. But when you are Warren Buffett, who constantly
speaks out against excessive compensation, that responsibility
is even greater.
There should be no double standard for Coca-Cola or for
Buffett. After paying its management millions of dollars to run
a company a monkey could run (Buffetts words,
not mine), shareholders shouldnt have to fork over an
additional 14 to 16 percent over four years to management to
incent them to do their jobs running a company with such
a significant competitive advantage (which was there long
before these executives arrived) that any MBA student with a C-
average could operate.
We dont own Coke and probably wont own it unless
the price gets cut by half, so my tirade here is not as a
wounded shareholder but as an American. Its what Buffett
said in a CNBC interview that bothered me the most:
Its kind of un-American to vote no at a Coke
meeting. I would not want to live in a country where
everyone always agrees with the powers that be, where people
are afraid to speak up. I lived there once in the Soviet