As I noted in this post, it’s annual report season again. I just opened my Berkshire Hathaway annual report and once again was not the least bit disappointed.
The Berkshire report confirms, as it does every year, why I am a card-carrying, stock-owning, unabashed member of the Cult of Warren Buffet.
The report, most of which can be found here, is such a wonderful read. Warren crafts his usual narrative about the state of the company, and it is with out a doubt the most readable annual report I’ve ever seen. Even though his note is long, at over 20 pages, there’s almost no business jargon, there’s no filler, and not a smidge of the spin so many reports are drowning in. I read every word — and every word of all the accompanying documents. All in one sitting on the airplane.
The report confirms again what a really great manager and leader he is. He simply does just about everything right, and does it with such frankness, charm, and sincerity, that I can’t help but gush over the guy.
It’s not that he’s perfect, and not that he’s magic. He’s made mistakes, and rubs a number of people the wrong way. But I think most of those people need to untwist their underwear and take some deep breathes (or a couple Valium).
Just like Warren, I’ll be straight with you: I’m a shareholder in Berkshire, and it’s just hard not to like the guy when the returns are so great. But in reality, that’s just a small part about what I think makes the guy so special.
Reading his report, or even looking at the Berkshire web site (seen at left), the first thing you notice is how upfront and frank the whole operation is. Who else has their link to their SEC filings as the fourth item on their home page, or includes the last 30 years of Chairman’s letters right in plain sight, or has their answer to the most controversial of their shareholder motions posted on the home page?
With most companies, this kind of stuff is buried in the filings, if it is available at all. Nothing is ever said that some spin doctor hasn’t crafted beyond intelligibility. And acknowledging mistakes? Well that just isn’t done, doncha know.
But with Warren, it’s all right there. In plain sight, in plain english, and it’s just the plain truth. After plowing through miles of other poop in other glossy annual reports, this one is like a cool ocean breeze. And there’s not a glossy picture of the CEO, or the Board, or the remarkably (intentionally?) diverse workforce in sight.
So stop reading me, go read Warren’s letter. Here’s the PDF file:
Then come back here, and tell me what you think.