The Master Gives It Back
Warren Buffett, the legendary chairman of Berkshire Hathaway, stunned the world this past summer when he announced that he would contribute the bulk of his roughly $40 billion fortune to philanthropy. Even more surprising, the "Oracle of Omaha" committed more than $30 billion to the Bill and Melinda Gates Foundation, to double its efforts to improve global health.
The world's second-wealthiest person, just behind his good friend Gates, Buffett is known for his acumen as an investor, not as a philanthropist. For years, people have quietly wondered when Buffett would start giving away his accumulated wealth, but none suspected he was preparing to make the largest gift in history. Characteristic of Buffett, he directed that $1.5 billion be given away each year but declined even to put his name on the foundation.
Such bold moves are typical of Buffett's leadership. He rarely invests for the short term or changes his mind. But what is less familiar to the public is his generosity of spirit to others, from students contemplating their careers to new CEOs facing difficult challenges. Consider this example from one of my M.B.A. students. Vitaliy Pereverzev of Kazakhstan was part of an investment club that recently traveled to Omaha to meet Buffett and have lunch at Gorat's, his favorite restaurant. When his classmates started having pictures taken with Buffett after lunch, Pereverzev realized he had left his camera back in the Berkshire Hathaway boardroom.
Rather than sending a staff person, Buffett offered to drive Pereverzev himself. And he took the opportunity to provide the young Kazakh with some counsel. "Vitaliy, you have to do what you love. I do not want to live like a king. I just love to invest," Buffett said. "Money aside, there is very little difference between you and me in terms of lifestyle. I eat simple meals. I drive a regular car. I make decisions, and, yes, I, too, make mistakes." Buffett went on to describe his childhood and what he learned working in his grandfather's grocery store.
He asked Pereverzev about his life in Russia and Kazakhstan, eager to learn what people thought about the United States-and American companies. Then Buffett offered the young student advice he won't forget: "Be a nice person, Vitaliy. It's so simple that it's almost too obvious to notice. Look around at the people you like. Isn't it a logical assumption that if you like traits in other people, then other people would like you if you developed those same traits?"
Deceptively simple. That piece of leadership advice reflects Buffett's wisdom: His lessons are often the simplest and the most empowering. Anne Mulcahy of Xerox told me about her encounter with Buffett shortly after becoming CEO in 2001. Facing a liquidity crisis with $18 billion in debt, Mulcahy was under intense pressure to declare bankruptcy. Determined to save the company she loved, she made a "cold call" to Buffett, who invited her to Omaha for a chat.
Mulcahy later confessed that she had hoped Buffett would put money into Xerox, in spite of his well-known aversion to investing in technology companies. But the advice she got proved more valuable. After listening patiently to her problems for two hours, Buffett told her, "You're thinking that the investors, bankers, and regulators are the people you need to survive. Put them all aside, and give priority to talking to your people and your customers about what is wrong and what you have to do."