The Norman Transcript

Nation/World

May 4, 2014

Thousands descend on Omaha to hear Buffett speak

OMAHA, Neb. — Warren Buffett shrugged off concerns about his Berkshire Hathaway conglomerate, which has trailed the overall market, and told shareholders Saturday to remain optimistic about his company, as well as the American economy.

More than 30,000 people descended on the annual gathering to listen to Buffett and Berkshire Vice Chairman Charlie Munger, who faced tough questions about Berkshire’s prospects for growth and acquisitions, and also how Buffett came to handle a vote on pay packages crafted for Coca-Cola executives, a company in which Berkshire holds a major stake.

Buffett abstained from voting Berkshire’s 400 million shares against the compensation plan last week, though he has long advocated against exorbitant executive pay, and after he described Coca-Cola’s package as excessive.

“I thought this was the most effective way of behaving at Berkshire,” Buffett said Saturday.

Buffett said he told Coke’s CEO privately that he opposed the compensation plan, but didn’t want to criticize the company publicly or join another Coke investor’s very public campaign to curtail that pay.

“We made a clear statement about the excessiveness of the plan, but we didn’t go to war with Coke in any way,” Buffett said.

Shareholder Jake Kamm said the explanation Buffett offered initially for not voting against the pay package was not convincing.

“It’s a little bit of spin,” said Kamm, who teaches finance at Baldwin Wallace University near Cleveland, Ohio.

Buffett said the true test will come when Coke reveals its pay packages over the next year.

Buffett’s son, Howard Buffett, serves on Coke’s board and supported the compensation plan, which raised some hackles among Berkshire shareholders because he is on the shortlist to take a powerful position at the company on Buffett’s departure. But Buffett said Berkshire shareholders shouldn’t worry about his preference that his son one day become Berkshire’s chairman.

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