Warren Buffett on Business : Principles from the Sage of Omaha

Appendix D

July 23, 2008, Memo to Berkshire Hathaway Managers

BERKSHIRE HATHAWAY INC.

1440 KIEWIT PLAZA OMAHA. NEBRASKA GB131 TELEPHONE [phone] FAX [phone]

 

WARREN E. BUFFETT, CHAIRMAN

 

 

 

Memo

To: Berkshire Hathaway Managers (“The All-Stars”)

 

cc: Berkshire Directors

 

From: Warren E. Buffett

 

Date: July 23, 2008

 

 

This is my biennial letter to reemphasize Berkshire’s top priority and to get your help on succession planning.

 

The priority is that all of us continue to zealously guard Berkshire’s reputation. We can’t be perfect but we can try to be. As I’ve said in these memos for over 20 years: “We can afford to lose money - even a lot of money, But we can’t afford to lose reputation - even a shred of reputation.” We must continue to measure every act against not only what is legal but also what we would be happy to have written about on the front page of a national newspaper in an article written by an unfriendly but intelligent reporter.

 

Sometimes your associates will say “Everybody else is doing it,” This rationale is almost always a bad one if it is the main justification for a business action. It is totally unacceptable when evaluating a moral decision. Whenever somebody offers that phrase as a rationale, in effect they are saying that they can’t come up with a good reason. If anyone offers this explanation, tell them to try using it with a reporter or a judge and see how far it gets them.

 

If you see anything whose propriety or legality causes you to hesitate, ...