April 18, 2014 01:00 AM

Christian Brothers doesn't want Buffett on Berkshire Hathaway's board

Barry B. Burr

Photo: Bloomberg

'You only find out who is swimming naked when the tide goes out.'

Photo: Bloomberg

'Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down.'

Photo: Bloomberg

'The stock market is a no-called-strike game. You don't have to swing at everything — you can wait for your pitch. The problem when you're a money manager is that your fans keep yelling, 'Swing, you bum!''

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'Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy when others are fearful.'

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'The most common cause of low prices is pessimism — sometimes pervasive, sometimes specific to a company or industry. We want to do business in such an environment, not because we like pessimism but because we like the prices it produces. It's optimism that is the enemy of the rational buyer.'

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'I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.'

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'We have tried occasionally to buy toads at bargain prices with results that have been chronicled in past reports. Clearly our kisses fell flat. We have done well with a couple of princes — but they were princes when purchased. At least our kisses didn't turn them into toads. And, finally, we have occasionally been quite successful in purchasing fractional interests in easily-identifiable princes at toad-like prices.'

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'We've long felt that the only value of stock forecasters is to make fortune tellers look good. Even now, I continue to believe that short-term market forecasts are poison and should be kept locked up in a safe place, away from children and also from grown-ups who behave in the market like children.'

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'Ben Graham's Mr. Market allegory may seem out-of-date in today's investment world, in which most professionals and academicians talk of efficient markets, dynamic hedging and betas. Their interest in such matters is understandable, since techniques shrouded in mystery clearly have value to the purveyor of investment advice. After all, what witch doctor has ever achieved fame and fortune by simply advising 'Take two aspirins'?'

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'Our favorite holding period is forever.'

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'The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money. Think airlines. Here a durable competitive advantage has proven elusive ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty Hawk, he would have done his successors a huge favor by shooting Orville down.'

Christian Brothers Investment Services is opposing the election of all Berkshire Hathaway Inc. directors, including Warren E. Buffett, chairman and CEO, according to the proxy-voting disclosure of the manager of managers whose clients are Catholic institutions.

CBIS is withholding its votes for the directors “due to a lack of information on diversity of the composition of the board” and insufficient background about the directors, even lacking photographs of them, said Marietta L. Parenti, CBIS spokeswoman.

Berkshire Hathaway's proxy ballot permits shareholders the choice of voting in favor of all directors or withholding the vote for directors.

The $201.5 billion (US$182.9 billion) Canada Pension Plan Investment Board, Toronto, will vote in favor of all directors, according to its proxy-voting disclosure.

Both CBIS and CPPIB oppose Berkshire Hathaway's proposal for a three-year frequency on non-binding say-on-pay voting by shareholders and instead call for annual voting on executive compensation. The two funds plan to vote in support of the current pay package for Mr. Buffett and other top executives.

CPPIB is opposing a shareholder proposal calling for setting quantitative goals for reduction of greenhouse gas and other air emissions at the company's energy-generating holdings. CBIS supports the proposal.

Both CBIS and CPPIB oppose a shareholder proposal calling for Berkshire Hathaway to pay annual dividends. The company hasn't paid a dividend since 1967, according to its 10-K filing.

CPPIB holds 4.2 million Berkshire Hathaway Class B shares, according to CPPIB's filing with the Securities and Exchange Commission. They are valued at $543 million. CBIS' shares weren't available. Berkshire Hathaway has 1.1 billion Class B shares outstanding.

Berkshire Hathaway's annual meeting is May 3.

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