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Warren Buffett won’t 'go to war' with Coca-Cola

Published time: May 05, 2014 13:11
Berkshire Hathaway CEO Warren Buffett (Reuters / Rick Wilking)

Berkshire Hathaway CEO Warren Buffett (Reuters / Rick Wilking)

Warren Buffett defended his decision to abstain from a shareholder vote on Coca-Cola’s new controversial executive compensation scheme at this weekend’s Berkshire Hathaway investor meeting.

The annual meeting, known as the ‘Woodstock for Capitalists’ was held in Omaha, Nebraska from May 4-5, and attendees grilled Buffett on his decision not to vote on restricting compensation packages for top executives at the beverage company. Berkshire Hathaway owns 9.1 percent of Coca-Cola making it the largest single stockholder.

Buffett reaffirmed he thought the plan, which includes long term equity awards and issuing 340 million new shares and options over the next for years, was too much.

"We made a very clear statement about the excessiveness of the plan and, at the same time, we in no way went to war with Coca-Cola," Buffett said. "I don't think going to war is a very good idea in most situations."

Berkshire chose not to vote because they didn’t want to act directly in defiance of Coke’s management. Buffett has been putting pressure on Coca-Cola to cut back on its excessive salary plan, which will bump executives’ pay starting 2015.

The plan, which Buffett denounced as a "lottery" giveaway, included long-term equity awards as well 340 million new shares and options over four years.

Previously Buffett said the plan wasn’t completely "out of whack" as quality executive performance is very valuable to a company.

Buffett, the world’s third-richest man, with a personal fortune estimated at $65.5 billion, said he talked with Coke’s president and CEO, Muhtar Kent at the investor meeting. Buffett has spoken out against the ‘excessive’ compensation scheme for top executives, but believes the decision for Berkshire to abstain from voting sends and even clearer message.

In the US, pay inequality between employees and top bosses has increased dramatically. In 2012, CEO’s of the S&P 500 companies were on average paid 354 times more than their workers.

Comments (11)

 

Delete This Comment 07.05.2014 21:07

SMERSH 06.05.2014 09:49

Is there any way we can just delete you?

  


I once tried changing my user name to: Oompa Loompa
but it still keeps posting under this one instead.


 

DoAskDoTell 07.05.2014 07:16

Weasel Warren Boy is lucky to have a long-standing good-cop great-liar PR team...

His lies are naked now that it is shown that the US does not practice "capitalism&quo t; but a bastardized version of crony "capitalism&quo t;

Sick capital-saint WB is supposed to stand for old american capitalism (like the uk's queen to stand for the "common touch").

The world would be a better place without C-C and its oligarchs (see bromide flame retardants, corn syrup, aspartame...). Boycott them, we win lol




 

Fredrick Da Great 06.05.2014 18:54

Recently, President Obama made a joke saying that his new motto is CTRL-ALT-DEL instead of “Yes, we can”. Regarding the US economy, maybe he mean SHIFT-DELETE. I just wonder if the imminent collapse of dollar will help some how to come closer to the reality. Everything is made in China, except the US Dollar. Or maybe I'm wrong.

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