The physical proximity of a nine-member Investment Policy Committee that has worked together for decades is the cornerstone of Dodge & Cox Stock’s success; all nine are co-managers of the fund.
“We all operate out of one floor here, the 40th,” says John Gunn, chairman and CEO of Dodge & Cox, which is based in San Francisco. “We feel that having only one office works well for us.”
Each member of the firm’s close-knit investment committee has been with Dodge & Cox for at least 15 years, says Charles Pohl, chief investment officer (he joined the firm in 1984, while Gunn has been with it since 1972). As such, they know each other well and are not afraid to articulate their individual opinions, no matter how contrarian these may be. Each investment recommendation is subjected to intense group scrutiny, the two men report, for both its merits as a specific investment and its role in the overall portfolio, and the debate over each proposed purchase or sale is described as a respectful, if sometimes vigorous, exchange among colleagues. When all voices have been heard, the group takes action or reconvenes if further research is warranted.
“We don’t always agree on what we should do but we are always operating on the same policy,” Gunn says.
Because Dodge & Cox is almost entirely employee-owned, the turnover of investment professionals is almost non-existent, Pohl says. The firm likes to hire people straight out of top business schools like Harvard or Stanford and train them in the Dodge & Cox philosophy, he says.
In addition to Gunn and Pohl, the nine managers of the Dodge & Cox Stock team include: C. Bryan Cameron, director of research; Kenneth E. Olivier, president; Diana S. Strandberg, vice president; Gregory R. Serrurier, vice president; Steven C. Voorhis, vice president; Wendell W. Birkhofer, vice president; and David C. Hoeft, vice president.