Berkshire Hathaway Inc.: From the perspective of the Chairman of Board The narrator of the proxy statement, dated February 2011, was Warren E. Buffet. He was the Chairman of the Board of Berkshire Hathaway Inc. He related the story of the company including its history and operations from 1965 up to 2010 in a more personal and funny tone. He described how the company had grown and most of the challenges that it had surpassed. First, the business started as a textile company and then expanded into other industries, such as market securities, See’s Candies, Business Wire (Buffet 8), insurance, electronics (12), boat manufacturing, farm-equipment, shoes, jet airplanes (13), wines and spirits, construction (14) and into many other firms. There were different advantages of the company that were identified: 1) top caliber managers who were passionate in their work; 2) Capital allocation for business growth, acquisition, expansion to other industries and positive initiatives (7); and 3) Corporate culture, such as treating manager’s (or other’s) money as if they were one’s …show more content…
Under the model of “collect now-pay later” for the insurance sector of Berkshire, property and casualty insurers could receive premiums and would pay the claims at a later date. These payments were called as “float,” which could be used to provide insurance claims to other insurers. This float was also optionally invested to earn substantial profit and credit interests. An underwriting profit was earned when the premiums exceeded the insurance expense and the value of casualty / property losses. Otherwise, an underwriting loss would be reported. On the part of Berkshire and its insurance business, it had reported an underwriting profit that was worth $17 billion for 8 years