The following core principles are a statement of values we wholeheartedly believe in and strive to practice every day.
**Decentralized Model** We seek out the finest managers to lead our subsidiaries, who in turn guide talented teams. We employ a decentralized structure, granting them autonomy based on well-placed trust. This approach minimizes bureaucracy, providing our managers with the independence to relentlessly focus on their own operations. In return, we expect them to demonstrate accountability and integrity in their performance. This autonomy is a magnet for exceptional talent to join Berkshire Hathaway.
When I transitioned to Vice Chairman of Non-Insurance Operations in 2018, the leaders of our subsidiary companies all asked a similar question: would the decentralized model and their responsibilities change? I assured them that I have always been part of this culture, which combines autonomy with accountability, and have witnessed its results. When decisions are made by those closest to the business and responsible for its outcomes, the decision-making is faster, better informed, and more resolute. This will not change. Our CEOs will never have to navigate layers of bureaucracy or be forced to meet short-term profit expectations that undermine long-term value.
Our decentralized model is a competitive advantage, attracting managers who thrive with autonomy and uphold their responsibilities. Berkshire Hathaway must have leaders who embody its principles, not principles that are adapted to suit individuals.
**Integrity** We uphold Berkshire Hathaway's reputation for integrity, which is reflected in the consistency of our thoughts, words, and actions. The decisions we make preserve our culture, our communications are candid and transparent, and we keep our promises. The result is a reputation, earned—not claimed—through the cumulative effect of principled behavior over time. Every action reflects a thoughtful effort to deepen the trust people place in Berkshire Hathaway.
For over 25 years, we have played a clip at every annual shareholder meeting from Warren Buffett's 1991 testimony before Congress regarding Salomon Brothers: "Lose money for the firm, and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless." Our commitment to integrity is unwavering and uncompromising. We understand that integrity is not a quality to be kept on a shelf for admiration; it is an active quality that must be earned, re-earned, and maintained every single day.
We will experience both business successes and setbacks. When we fail, we acknowledge it openly. Doing the right thing also means correcting our mistakes. A prime example of this is BNSF Railway's resolution in 2025 of a long-standing dispute with the Swinomish Indian Tribal Community regarding the transport of crude oil across tribal land. The BNSF decision that sparked the controversy was made long ago, but the current BNSF leadership built a partnership rooted in communication, understanding, and respect. BNSF acknowledged past mistakes and apologized, paving the way for a mutually beneficial agreement that allows for safe operations on tribal land while meeting customer needs.
In the daily operations of all our businesses, we constantly make choices about how to conduct our work. We have hundreds of thousands of employees who act with good character, honesty, and by doing what is right. However, in any large organization, a very small number of individuals will fail to meet our standards. We have zero tolerance for such behavior. When it occurs, we address it decisively and firmly. Guarding our integrity and reputation is a continuous journey. Be assured that we are unrelenting and fully committed to this endeavor.