The Sudan Issue

By late afternoon, the meeting hall had cleared of about half of its attendees, but that's when the folksy friendliness of the day left the room, and the confrontation seen at many other shareholder meetings took the stage, or the floor, as it were.

The issue: Berkshire Hathaway's ownership of 30 percent of A and B shares in PetroChina, whose controlling shareholder, China National Petroleum Corp., conducts business in Sudan. No fewer than five people (four shareholders, including one pastor who invoked "Jesus" in his speech, and a Sudanese) took the mic to argue that the investment was an endorsement of the genocide taking place in Sudan.

Buffett maintained his support for Berkshire's stake in PetroChina by arguing that a holding cannot dictate policy to its controlling shareholder, although the reverse may be true, noting of Berkshire holding Wesco, "We can tell Wesco what to do, but Wesco cannot tell Berkshire what to do."

"I agree 100 percent with the fact that's what's happening in the Sudan should not be happening," he said. "But i don't think it's worth selling the shares. They would be sold to somebody else. The price of the stock would go down."

He concluded, "It is China that has a policy of being partners with Sudan, and it is not PetroChina at all."

And then Charlie Munger, Buffett's largely silent partner up on the podium, chimed in, "China is a remarkably rising nuclear power. Who should say how the Americans should react to China." Of the Sudan, he said, "There's a lot of cruelty and always has been. Nobody's in favor of cruelty but there's a limit to how much you can fix."