Berkshire Hathaway 1998 Annual Meeting Transcript

by Edward · Published April 13, 2019 · Updated August 26, 2019

Transcript of the 1998 Berkshire Hathaway Annual Meeting held on May 4, 1998 on Omaha, Nebraska:

(Click here to skip to the Q&A section)

(To see the full transcripts of all Berkshire Hathaway Annual Meetings on record, click here)

Meeting Start – Introduction and Warren explains how the meeting will proceed

Warren Buffett:

Morning. Morning. I’m Warren Buffett, chairman of Berkshire, and… this is my partner. This hyperactive fellow over here is Charlie Munger.

And we’ll do this as we’ve done in the past, following the Saddam Hussein school of management, we’re going to go through the business meeting in a hurry, and then we’re going to do questions.

And we’ll do those until 3:30, with a break at noon, when we’ll take off for 30 minutes or so while you can grab lunch. And those of you… there’s… we’re operating in an overflow room as well… so those of you who are in the overflow room now can join the main floor after the noon break, because we’ll have plenty of room then.

We’ll go until 3:30. We’ll try to get to all the questions we can. We’ve got 11 zones, ten of them in this room, and we’ll just make our way around them. I’ve got a little map here, which I’ll get oriented on here in a second. And let’s see.

And I think we’ll get through the business meeting now. Incidentally, I don’t see that movie before it’s shown, but that was one of our directors singing at that final session there.

We keep costs down at Berkshire.

Introduction of Berkshire’s Board of Directors

Warren Buffett:

OK, the meeting will now come to order. I’m Warren Buffett, chairman of the board of directors of the company and I welcome you to this 1998 annual meeting of shareholders.

I will first introduce the Berkshire Hathaway directors that are present in addition to myself.

So we have… and I can’t see very well with the lights here, but if you’ll stand as I name you.

Susan T. Buffett, the vocalist.

Howard G. Buffett, the non-vocalist.

Malcolm G. Chace.

Charlie, you’ve met. And Ron Olson.

And Walter Scott Junior.

Also with us today are partners in the firm of Deloitte and Touche, our auditors. They are available to respond to appropriate questions you might have concerning their firm’s audit of the accounts of Berkshire.

Mr. Forrest Krutter is secretary of Berkshire. He will make a written record of the proceedings.

Miss Becki Amick has been appointed inspect of elections at this meeting. She will certify to the count of votes cast in the election for directors.

The named proxy owners for this meeting are Walter Scott Junior and Marc D. Hamburg. Proxy cards have been returned through last Friday, representing 1,039,276 Class A Berkshire shares, and 1,080,509 Class B Berkshire shares to be voted by the proxy holders as indicated on the cards.

The number of shares represents a quorum and we will therefore directly proceed with the meeting.

We will conduct the business of the meeting and then adjourn the formal meeting. After that, we will entertain questions that you might have.

Minutes of the Last Meeting of Shareholders and Quorum

Warren Buffett:

First order of business will be a reading of the minutes of the last meeting of shareholders. I recognize Mr. Walter Scott Jr., who will place a motion before the meeting.

Walter Scott Jr.:

I move the minutes… the reading… reading of the minutes of the last stockholders meeting be dispensed with.

Warren Buffett:

Do I hear a second?

A lot of seconds. The motion has been moved and seconded. Are there any comments or questions? We will vote on this motion by voice vote. All those in favor say aye.

Audience:

Aye.

Warren Buffett:

Opposed? Motion’s carried.

Does the secretary… have a report of the number of Berkshire shares outstanding, entitled to vote, and represented at the meeting?

Forrest Krutter:

Yes, I do. As indicated in the proxy statement that accompanied the notice of this meeting that was sent by first-class mail to all shareholders of record on March 6, 1998, the record date for this meeting, there were 1,199,680 shares of Class A Berkshire Hathaway common stock outstanding, with each share entitled to one vote on motions considered at this meeting.

And 1,245,081 shares of Class B Berkshire Hathaway common stock outstanding, with each share entitled to 1/200th of one vote on motions considered at the meeting.

Of that number, 1,039,276 Class A shares and 1,080,509 Class B shares are represented at this meeting by proxies returned through last Friday.

Warren Buffett:

Thank you, Forrest.

If a shareholder is present who wishes to withdraw a proxy previously sent in and vote in person on the election of directors, he or she may do so. Also, if any shareholder that is present has not turned in a proxy and desires a ballot in order to vote in person, you may do so.

If you wish to do this, please identify yourself to meeting officials in the aisles who will furnish a ballot to you. Those persons desiring ballots, please identify themselves so that we may distribute them.

Election of Berkshire’s Board of Directors

Warren Buffett:

The one item of business at this meeting is to elect directors. I now recognize Mr. Walter Scott Junior to place a motion before the meeting with respect to election of directors.

Walter Scott Junior:

I move that Warren E. Buffett, Susan T. Buffett, Howard G. Buffett, Malcolm G. Chace, Charles T. Munger, Ronald L. Olson, and Walter Scott Junior, be elected as directors.

Warren Buffett:

Is there a second? It’s been moved and seconded that Warren E. Buffett, Susan T. Buffett, Howard G. Buffett, Malcolm G. Chace, Charles T. Munger, Ronald L. Olson, and Walter Scott Junior be elected as directors.

Are there any other nominations? Is there any discussion? Nominations are ready to be acted upon.

If there are any shareholders voting in person, they should now mark their ballots on the election of directors and allow the ballots to be delivered to the inspector of elections.

Would the proxy holders please also submit to the inspector of elections a ballot on the election of directors, voting the proxies in accordance with the instructions they have received.

Miss Amick, when you are ready you may give your report.

Becki Amick:

My report is ready. The ballots of the proxy holder, in response to proxies that were received through last Friday, cast not less than 1,039,298 votes for each nominee. That number far exceeds the majority of the number of the total votes related to all Class A and Class B shares outstanding.

The certification required by Delaware law of the precise count of the votes, including the additional votes to be cast by the proxy holders in response to proxies delivered at this meeting, as well as those cast in person at this meeting, if any, will be given to the secretary to be placed with the minutes of this meeting.

Warren Buffett:

Thank you, Miss Amick.

Warren E. Buffett, Susan T. Buffett, Howard G. Buffett, Malcolm G. Chace, Charles T. Munger, Ronald L. Olson, and Walter Scott Junior have been elected as directors.

After adjournment of the business meeting, I will respond to questions that you may have that relate to the businesses of Berkshire that do not call for any action at this meeting.

Does anyone have any further business to come before this meeting before we adjourn?

End of Formal Business Meeting

Warren Buffett:

If not, I recognize Mr. Walter Scott Junior to place a motion before the meeting.

Walter Scott Junior:

I move this meeting be adjourned.

Warren Buffett:

Second?

Motion to adjourn has been made and seconded. We will vote by voice. Is there any discussion? If not, all in favor say aye?

Audience:

Aye.

Warren Buffett:

All opposed say I’m leaving. This meeting is adjourned.

Charlie and I may not get paid much, but we work fast on an hourly basis.

Q&A Guidelines

Warren Buffett:

Now, we’re going to do this by zones, and I think you can see who is manning each… yeah, I see we’ve got a number out there already.

And please ask just one question.

The only thing that I can think of that we won’t discuss is what we’re buying or selling or may be buying or selling, but we’ll be glad to talk about anything that’s on your mind. So let’s go right to zone 1 and start in.