03 May 2004

Buffett praises Google corporate governance

Buffett praises Google corporate governance:

By Dan Roberts in Omaha

Warren Buffett has heaped praise on Google for adopting his unconventional corporate governance style but stopped short of recommending the search engine's initial public offering to his own shareholders.

Addressing the annual meeting of his Berkshire Hathaway investment company, the world's second-richest man made little secret of his delight that such a high profile newcomer was endorsing an approach often dismissed as too quirky for other companies to follow.

'I am very pleased that the fellows at Google said they were influenced by the [Berkshire] owners manual,' he told a record crowd of 19,500 shareholders who made the annual pilgrimage to his home town of Omaha, Nebraska.

Larry Page and Sergei Brin, Google's founders, last week outlined plans for an unusual public auction of their shares using a corporate structure which deliberately challenges traditional Wall Street orthodoxy. Like Berkshire Hathaway, they will refuse to give earnings guidance or aim for stable profits growth, and will create two classes of shareholders to protect management independence.

'I liked their prose,' said Mr Buffett. 'It pleases us enormously that other people think it is a good idea to talk to their owners in a very straight-forward manner. I think more companies ought to do it.'"

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