1 Shareholders as Partners.
“Although our form is corporate, our attitude is partnership.”1
2 Corporate Culture.
“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently.”2
3 Corporate Governance.
“At Berkshire, board members travel the same road as shareholders.”3
4 Berkshire Managers.
“They unfailingly think like owners (the highest compliment we can pay a manager).”4
“As managers, Charlie and I want to give to our owners the financial information and commentary we would wish to receive if our positions were reversed.” 5
6 Acquisition of Nebraska Furniture Mart.
“We gave Mrs. B a check for $55 million and she gave us her word. That made for an even exchange.” 6
7 The Acquisition of Geico.
“The security I like best” 7
8 The Acquisition of General Reinsurance.
“Long ago, Mark Twain said: A man who tries to carry a cat home by its tail will learn a lesson that can be learned in no other way. If Twain were around now, he might try winding up a derivatives business. After a few days, he would opt for cats.” 8
9 The Assessment and Management of Risk.
“Don't think, however, that we have lost our appetitefor risk. We remain prepared to lose $6 billion in a single event, if we have been paid appropriately for assuming that risk. 9
10 Executive Compensation.
“At Berkshire...I am a one man compensation committee who determines the salaries for the CEOs of around 40 significant operating businesses. How much time does this aspect of my job take? Virtually none. How many CEOs have voluntarily left us for other jobs in our 42-year history? Precisely none.” 10
11 Time Management.
“When my mother got to be eighty the most important thing in how long you live is how long your parents live. I got her an exercise bike, put her on a strict diet, and she's just piling up the years for me.” 11
12 How to Manage a Crisis.
“....I will attempt to do it in the manner of a fellow that has never met a lawyer.” 12
13 Management Principles and Practices.
“Simple, old and few” 13
14 Executive Behavior.
“Many CEOs attain their positions because they possess an abundance of animal spirits and egos....When such a CEO is encouraged by his advisors to make deals, he responds such as would a teenage boy who is encouraged by his father to have a normal sex life. It's not a push he needs.” 14
15 Mistakes I've Made.
“I can look back on every year in terms of mistakes I've made. The dumbest mistake I ever made was, will probably be in the future.” 15
16 Personal Investing.
“Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily-understandable business whose earnings are virtually certain to be higher five, ten and fifteen years from now.” 16
17 Buffett the Teacher.
“If I talk to 50 or 60 years old, basically they want to be entertained by my predictions/and if I talk to 20 year olds or even 25 year olds, they ask me the questions on their minds.”…The idea is that they listen and you may change some lives.” 17
18 Humor and Stories.
“ In the words of the prophet May West: too much of a good thing is wonderful.” 18
Appendix A Warren E. Buffett-A Chronological History.
Appendix B Berkshire Hathaway Inc.,An Owner's Manual, Owner Related Business Principles, January 1999.
Appendix C Berkshire Hathaway Inc., Code of Business Conduct and Ethics.
Appendix D July 23, 2008 Memo to Berkshire Hathaway Managers.
Appendix E Berkshire Hathaway Inc.- Corporate Governance Guidelines, As Amended on February 27, 2006.
Appendix F Intrinsic Value.
Appendix G The Superinvestors of Graham-And-Doddsville.
Appendix H Berkshire's Corporate performance vs. S&P 500.
Appendix I Berkshire's Common Stock Year-end Prices.
About the Author.