Coke Shareholders Stage Buffett Protest

April 22, 2004 ( - Coca-Cola Co. shareholders withheld nearly 16% of their votes for the election of investor Warren Buffett as a company director at Wednesday's annual meeting.

Because Buffett and the other 15 directors were running unopposed, they were re-elected to the board, despite the symbolic vote, according to the Chicago Tribune.

While the vote is nowhere near the 43% withheld last month from Walt Disney Co. Chief Executive Michael Eisner’s re-election (See  Eisner Protest Vote Reaches 43% ), it is a dramatic increase from previous votes on Buffett at Coke. The last time he was up for election, in 2002, shareholders withheld only 1.4% of their votes; in 1999, it was just 0.8%. Buffett had by far the largest percentage of withheld votes at Coke this year with the other directors received more than 96%, according to early data.

Citing several business ties between Coke and Buffett’s Berkshire Hathaway Inc. , the proxy advisory service Institutional Shareholder Services recommended that investors withhold votes from Buffett. “Ultimately, people may have decided to give Warren Buffett the benefit of the doubt,” said Patrick McGurn, senior vice president of ISS. “Something below 20% indicates less concern.”

Among those who withheld votes was the California Public Employees’ Retirement System (CalPERS), which is likewise keeping back votes from scores of directors who, like Buffett, sit on audit committees that have authorized independent accountants to provide non-audit services to the company (See  CalPERS Holds Back More Votes ). In all, CalPERS withheld votes from eight Coke directors, six of them for audit committee conflicts.