May 5 - Warren Buffett's annual Berkshire Hathaway shareholder lovefest was dominated by corporate governance issues but the mood was still as lighthearted as ever. Lily Jamali reports.
It was Woodstock for Capitalists in Omaha, Nebraska. The lines long for the thousand of Berkshire Hathaway investors who flocked to its annual meeting this weekend. CEO Warren Buffett made sure fun with shareholders - not to mention Bill Gates - was on the agenda. But ultimately, the focus was all business. The Oracle of Omaha has made news by choosing not to vote on Coca Cola's executive compensation plan - even thought he thought it was excessive. Buffet holds a 9% stake in the company. With the plan now being revised, Buffett says he has no regrets: SOUNDBITE: WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY (ENGLISH) SAYING: "No, no, no. I think it's worked out perfectly." Over the weekend, though, activist investor Carl Icahn painted Buffett's approach as a blow to U.S. corporate governance. In a Barron's opinion piece, Icahn asked: "If a man of Warren Buffett's stature openly states he abstains from voting on plans he doesn't agree with because he 'loves' management and doesn't want to 'express any disapproval', how can we expect other board members in this country to voice their opinions, especially if they are opposed to the CEO's interest?" At the annual meeting, Buffett said companies prefer dobermans to cocker spaniels for their boards. And he reiterated his confidence in his approach: SOUNDBITE: WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY (ENGLISH) SAYING: "I don't have a consultant come in to tell me how to do it. And I work on arrangements with 70 plus CEOs - they do a good job and feel fairly treated and go on. So it's - you have to be knowledgeable. You have to understand business. You have to understand employing people. And you have to understand something about how be fair to shareholders." Buffett also stood behind Berkshire Hathaway's record. The conglomerate has underperformed the S&P 500 stock index for most of the past 5 years. As for the next five years: SOUNDBITE: WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY (ENGLISH) SAYING: "Depends on what the market does. If the markets flat or down, we'll do much better than the S&P. If the markets up a whole lot, we'll probably fall a little short. We think when we're in the complete cycle, we'll probably do a little better but we don't make any promises." Buffett also said when it comes to long-term bonds, there are few good options: SOUNDBITE: WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY (ENGLISH) SAYING: "If you had to buy anything, I think you'd buy TIPS but the yield there is terrible so I would stay away from long-term dollar investments." ...And then there's succession. His right-hand man has long been Berkshire's Vice Chairman Charlie Munger, who's 90. So does the company have another dynamic duo up its sleeve?: SOUNDBITE: WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY (ENGLISH) SAYING: "There's another dynamic duo but there's not another Charlie Munger." Buffett's son, Howard, is widely expected to take over as non-executive chairman when Warren steps down. But he won't oversee investments or operations. So even after Buffett-palooza, details on Berkshire's succession plan are still up in the air.