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"Character Counts" by Jack Bogle
Taylor Larimore 11-11-2003, 10:00 PM | Post #96899 | 
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Hi Diehards:
Today, the mutual fund industry is going through a crisis of moral laxity. Many mutual funds, their managers and top executives are being charged with unethical and/or unlawful conduct. More indictments and charges are expected.

I believe Vanguard's legacy will prevent it from being involved. For an inside look at Vanguard, here are excerpts from forty-two speeches that Mr. Bogle gave to his 'crew". They are taken from his book, "Character Counts":

"We believe that personal integrity and professional conduct are not only basic standards but, in the long run, they are the only sound basis on which to build a durable business."

"We are engaged in 'The Vanguard Experiment,' to see if our unique form of organization will provide a better way to serve investors' needs, in investment performance, in product quality, in operational efficiency."

"We point to our asset growth as a convenient reference point from which to measure our success. But I want to undersore that asset growth is only one guide among many, and it is by no means the most important one."

"There are today perhaps 1.5 million investors. Down-to-earth, honest-to-God human beings with real needs and aspirations who believe that we offer them sound investment programs, with clearly delineated risks , at fair prices. We must never let them down."

"I do not believe it is hyperbole to say that success in the competitive arena depends, in the final analysis, on character. Our character will shape our future."

"Our purpose has remained singular--to put the interests of our clients first and paramount--no matter what the issue. In an industry that tries to be all things to all people, our steadfaxt course may well be unique."

"We do not have 'customers'. Rather, we have 'clients.'"

"One of our most important values is candor. Tell the whole truth and nothing but the truth, with no strings attached, and let the chips fall where they may."

"What we, all of us together, have built rests on a solid ethical foundation. For me, no other foundation is worthwhile, or even acceptable."

"Character is central to Vanguard's mission."

"We shall manage the Vanguard funds solely in the interests of our shareholders."

"What is important, I remind you, is that history will judge Vanguard not by how many tens of billions of assets we manage but how we played the game."

"We shall insure that the Vanguard Funds are subjected to adequate independent scrutiny."

"But let us never forget this: What defines Vanguard is not our process but our character--our mental and moral constitution."

"It is character, I reemphasize on this wonderful day of celebration, that will assure our continuing leadership in our industry."

"Today, we stand athwart mutual fund history, and surely yell 'stop' to the practices of the past, which have failed to place fund shareholders first."

"Stewardship: The one great idea that explains what Vanguard is, who it is, and what it does. Serving the shareholder first; acting as trustee in a fiduciary capacity."

"Mutual funds of the investor, by the investor, for the investor. -- I know of no other firm in this industry about which that can be said with such crystal clarity."
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Thank you Mr. Bogle for your leadership and character.

Best wishes.
Taylor

Originally posted in thread: 30972
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