The Hindu Business Line : What a yaaawn, Mr Chairman!

It seems many shareholders complained last year "about the time consumed by two speakers who advocated proposals of limited interest to the majority of the audience - and who were no doubt relishing their chance to talk to a captive group of about 19,500." So, this time around, Q&A is scheduled from 9:30 am to 3 pm, with a lunch break, and the annual meeting itself is slated at 3:15 pm.

"With our new procedure, those shareholders who wish to hear it all can stick around for the formal meeting and those who don't can leave - or better yet shop," writes Buffett, in all candour.

There are more instances of such plainspeak in his communiqué. Such as, promising not to inundate shareholders "with data that has no real value in estimating Berkshire's intrinsic value," for that would "tend to obfuscate the facts that count." Plus, the assurance of never "trading a good night's sleep for a shot at a few extra percentage points of return," because he never believes in risking what his "family and friends have and need in order to pursue what they don't have and don't need."

It's not that the model investor is infallible, and he recognises that fact: "We have disappointments, and we will try to be as candid in informing you about those as we are in describing the happier experiences."

There's a statement of commitment to fair-play: "We have no interest in large salaries or options or other means of gaining an `edge' over you."

A must-read for our helmsmen is the tail of Buffett's letter where he explains to shareholders the succession plan, beginning with the line: "On my death, Berkshire's ownership picture will change but not in a disruptive way: None of my stock will have to be sold to take care of the cash bequests I have made or for taxes."

In contrast, most of us rue sitting through chairman's speech that are ritualistically delivered in company meetings. Playing audience is often an exercise of endurance, because of the added baggage of trying to be polite by not yawning.

Thus, we may not relate to "the backdrop of the global economic environment" that a chairman may paint, even as he imagines that we "will be happy to note that the Company kept up its consistent good performance during the year under review."

Our top men know that numbers can switch off, so after reeling out profit and sales figures, they may add a couple of logic-testers, such as: "The capacity utilisation of all the plants, except Ammonia and Nitro-phosphate, were better than that of last year. Production of Ammonia and Nitro-phosphate were lower due to short supply of Natural Gas," to leave you confused whether `lower' cancelled out `better' and which one won ultimately.

Another honcho tells his shareholders that the increase in profit is "primarily on account of increase in prices and volume" and affirms that the growth was possible "due to your Company's ability to gear up the production level to meet the higher market demand." Well, that's what the managers are paid for.

"Barring unforeseen circumstances, the Company is poised to continue its good performance in the current year," assures the chairman, though members may leave with a nagging thought that any bad news next year may be blamed on things unforeseen.

In a different company, which has grown from "being a single product company to an institution that provides all encompassing financial solutions," the chief announces: "The corporation has been recognised and appreciated for its values, customer centricity, consistent returns to its investors, good governance, social consciousness and employee welfare." Not going the full hog yet, I'd say, because one can fill pages in self-praise.

One last pick: "During the year I have, on several occasions, interacted with groups of business analysts and the media. We have found these interactions useful in communicating effectively with the external environment and in helping them to gain a better understanding about our company's goals, priorities and working."

I think we urgently need succession plans if our companies are to succeed!

E&OE@TheHindu.co.in

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What a yaaawn, Mr Chairman!