Nebraskan for no

Buffett loses his voice - and maybe some sway

Warren Buffett lost his voice and maybe some sway along with it. The Omaha billionaire said on Wednesday he didn't vote against Coca-Cola's controversial equity pay plan, even though he disagreed with it. Buffett explained that he feared his opposition might be misinterpreted as a lack of support for Chief Executive Muhtar Kent. That's an odd message to convey to his legions of investment acolytes. It doesn't, however, mean Coke shouldn't hear what its largest owner is saying.

Although several shareholders complained of possibly significant dilution from the company's proposal to give thousands of employees stock, 83 per cent of the votes cast approved the plan. Buffett, who owns a nine per cent stake and whose son sits on the board, didn't share his thoughts ahead of time. Instead, he opted to tell CNBC of his abstention after the company's annual meeting.

It's a curious decision for someone who trades on a reputation as a straight shooter and knows full well the weight of his imprimatur. Given his ready access to media outlets, it would have been easy for Buffett to vote against the compensation plan and then publicly extol Kent for any virtues he admires.

What's more, by sitting out the balloting on Coke's reward scheme, Buffett took some sting out of his 2007 proclamation that "compensation reform will only occur if the largest institutional shareholders … demand a fresh look at the whole system." He had a chance to initiate a conversation about that system at a prominent, blue-chip, $180 billion company, but essentially failed to put his mouth where his money is.

The situation at Coke may turn out to be a minor test of Buffett's influence. However belatedly, he did denounce the proposal to issue millions in stock and options. Had his vote been cast, it would have meant over a quarter of the shares opposed the plan. If Buffett had declared his position earlier, the figure probably would have been higher still.

The question is whether Coke will ignore its single largest owner on an important issue like this. Doing so would speak volumes.