Investors

Our attitude is always partnership. I think of our shareholders and investors as partners, and myself as a managing partner (Because of the size of our shareholdings in various projects either new or established, we are also more often than not controlling partners.)

We do not view the company itself as the ultimate owner of our business assets, instead, view the company as a conduit through which our shareholders own the assets.

To state things simply, we try to give you in the annual report the numbers and other information that really matter. We pay a great deal of attention to how well our businesses are doing, and we also work to understand the environment in which each business is operating. For example, is one of our businesses enjoying an industry tailwind or is it facing a headwind? I need to know exactly which situation prevails and adjust our expectations accordingly. I will also pass along our conclusions to you.

Over time, I hope that a large majority of our businesses have exceeded our expectations. But sometimes we will have disappointments, and I will try to be as candid in informing you about those as we are in describing the happier experiences.

We use debt sparingly and, when we do borrow, we attempt to structure our loans on a long-term fixed-rate basis. We will reject interesting opportunities such as a new business model rather than over-leverage our balance sheet. This conservatism will penalize our results, but it is the only behavior that leaves us comfortable, especially from my experience considering our fiduciary obligations to shareholders, lenders and the many other equity holders who have committed unusually large portions of their net worth to our care.

A managerial "wish list" will not be filled at shareholder expense. I will not diversify by purchasing entire businesses at control prices that ignore long-term economic consequences to our shareholders. I will only do with your money what we would do with our own, weighing fully the values you can obtain by diversifying your own portfolios through direct purchases in the stock market.

Despite our policy of candor, we will discuss our activities in marketable securities only to the extent legally required. Good investment ideas are rare, valuable, and subject to competitive appropriation just as good product or business acquisition ideas are. Therefore, we normally will not talk about our investment ideas. This ban extends even to securities we have sold (because we may purchase them again) and to stocks we are incorrectly rumoured to be buying. If we deny those reports but say "no comment" on other occasions, the no-comments become confirmation. Though we continue to be unwilling to talk about specific stocks, we freely discuss our business and investment philosophy.