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2014 Berkshire Hathaway Annual Q&A With

Warren Buffett and Charlie Munger
It's not an official transcript. But we've captured the essence of the event, and we hope you find this a useful,
enjoyable read.
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Coca-Cola has an excessive compensation plan, but you didn't tell shareholders before the meeting. Had
it been disclosed earlier, we might have voted differently. You abstained, and you must have your
reasons. Why did you engage in this strange and un-Buffett-like behavior?
Warren: Some people think that strange and un-Buffett-like are not different. The proposal was made by a
shareholder opposed to the option program. His calculations of dilution were wildly off, and we didn't care to
get into a discussion of that.
But I did talk to Muhtar Kent, and I told him that we would abstain. I told him that I admired the company, but
the compensation was excessive. Immediately after, we announced that we had abstained and explained why. I
think that is the most effective way of behaving for Berkshire.
We made a very clear statement about the excessiveness of the plan, but without going to war with Coca-Cola.
And, we didn't endorse inaccurate calculations, or join forces with someone that I hadn't interacted with. If
you're going to war, you want to know what that alliance might be. I think the best outcome was achieved by
our abstention.
Charlie: I think you handled the whole situation very well.
Warren: Charlie was the only person that I discussed the vote with beforehand. I told him about the plan, and
we agreed on the course of action.