Yet his own investment choices seem to show little such concern. Among Berkshire's top 100 investments, 74 were evaluated for compensation problems by either KLD Research & Analytics, Institutional Shareholder Services Inc., or Goldman Sachs. Of those, 35 were in companies flagged for overpaying chief executives and 50 in companies flagged for excessive rewards for board members.
Berkshire holdings worth more than $21 billion also fared poorly on overall corporate governance, including accounting procedures; transparency on environmental and social policies; and lawsuits or regulatory problems concerning harm to investors, employees, customers or local communities.
Lapses on such issues tend to undermine Gates Foundation goals supporting human welfare.
But Buffett retains a rare authority, investment experts said, that could shift the debate on these issues, including the violence in Darfur.
"Buffett has tremendous power and influence," said Smith, of the Social Investment Forum. "He has the platform of the Gates Foundation and its incredibly important mission to speak from. His voice would be heeded."
*
charles.piller@latimes.com
Times staff writers Doug Smith and Edmund Sanders and researchers Maloy Moore and Scott Wilson contributed to this report.
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(BEGIN TEXT OF INFOBOX)
Conflicted investments
Berkshire Hathaway invests primarily in companies whose poor social, environmental or governance performance, as rated by investment researchers, tends to contradict the goals of the Bill & Melinda Gates Foundation.
Holdings that contradict the Gates mission (In millions)
*--* Problem area Gates Foundation Berkshire Hathaway Governance $3,072.6 $21,387.6 AIDS drug pricing 1,425.7 63.9 Environmental 3,370.0 28,798.0 Human rights 2,073.8 25,187.1 Sudan operations 22.4 3,315.6
*--*
Dollar amounts include companies that are listed in more than one category; not all problem categories are listed.
*
Percentage of investments getting poor ratings
Gates Foundation
2005*
Total: $21.2 billion
Good performance or unrated - 41%
Poor performance - 59%
Berkshire Hathaway
2006*
Total: $64.6 billion
Good performance or unrated - 13%
Poor performance - 87%
*Latest year available. Excludes loaned investments and government securities.
--
Sources: Bill & Melinda Gates Foundation; Berkshire Hathaway Inc.; Times reporting
Graphics reporting by Doug Smith and Charles Piller
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Warren E. Buffett
He is a trustee of the Bill & Melinda Gates Foundation. Beginning in 2009, Berkshire's wealth is expected to fund about half of the foundation's charitable awards.
Age: 76 (born Aug. 30, 1930)
Position: Chairman and CEO, Berkshire Hathaway Inc.
Education: Bachelor's degree, University of Nebraska; master's, Columbia University in New York
Family: Three children with first wife, Susan, who died in 2004; married Astrid Menks in August 2006
Party affiliation: Democrat
Notable:
* He has pledged $31 billion in Berkshire stock to the Gates Foundation.
* He is a fan of burgers, French fries and Cherry Coke.
* He enjoys bridge, math puzzles and playing the ukulele.
* He still lives in the five-bedroom Omaha home he bought in 1958 for $31,500.
* He also owns a 3,200-square-foot home in Laguna Beach, which he bought in 1971.
Times research by Scott J. Wilson
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About this report
This article is based on more than 35 interviews and hundreds of documents, including thousands of pages of Gates Foundation grant descriptions, tax forms, and lists of endowment holdings as of 2005, the most recent data available. It also included filings to the U.S. Securities and Exchange Commission by the foundation, Berkshire Hathaway Inc. and PetroChina.
Information was used from six leading services that give investors guidance on corporate performance: Calvert Group Ltd., Innovest Strategic Value Advisors, KLD Research & Analytics Inc., the Goldman Sachs Group Inc., Institutional Shareholder Services Inc. and Oekom Research. Ownership analysis was provided by Cary Krosinsky of CapitalBridge, a capital markets intelligence firm. None of the companies was directly involved in The Times' assessment of the Gates Foundation or Berkshire portfolios; they have taken no position on The Times' conclusions. For details, see latimes.com/gates.
