Mutual Fund Pioneer, John Bogle, Defines Success At Smeal College Commencement

UNIVERSITY PARK, PA (May 17, 2004)—John Bogle, creator of the first index mutual fund and founder and former CEO of The Vanguard Group, received an honorary degree and offered the commencement address at the May 15 graduation ceremony for Penn State’s Smeal College of Business. More than 980 students graduated from the college.

Bogle was recently recognized by Time magazine as one of the world’s most influential people. He has also been recognized by Fortune magazine as one of four financial “Giants of the 20th Century.” A magna cum laude graduate of Princeton University, Bogle currently serves as president of the Bogle Financial Markets Research Center. He is author of many publications on investing, including the best-selling book “Bogle on Mutual Funds.”

His commencement address, entitled “The Right Kind of Success,” outlined the attributes of success—wealth, fame, and power—as Bogle sees them today.

On Wealth:
“It is not that money doesn't matter. Who among us would not seek resources sufficient to fully enjoy our life and liberty? The security of freedom from want, the ability to pursue our chosen careers, the wherewithal to educate our children? But how much wealth does that require? Indeed, we ought to be wondering whether the super-wealth we observe at the highest reaches of our society – the ability to acquire an infinite number of the ‘things’ of life – is not more bane than blessing.”

On Fame:
“The momentary fame of our sports heroes and the glittering fame of our entertainers give us the joy of seeing human beings at the very peak of their potential, but in the fast-paced world of today, much of that glow rarely lasts more than the metaphorical 15 minutes that Andy Warhol promised each one of us. Fame for real accomplishment is one thing, fame based on self-aggrandizement, fame that is ill-deserved, and fame that is used for base purpose are quite different things. Please never forget that many—indeed most—of those who make the greatest contributions to the daily working of our society never experience even a moment of fame.”

On Power:
“… when power is used capriciously and arbitrarily, when power is reflected in grossly excessive perquisites, and when power is employed to create ego-building and compensation-enhancing mergers and unwise capital expenditures that are more likely to detract from corporate value than increase it, not only the shareholders of the corporation but its loyal employees—indeed society as a whole—are the losers … using Adam Smith’s ancient words, power that is ‘something grand and beautiful and noble, well worth the toil and anxiety, to keep in motion the industry of mankind, to invest and improve the sciences and arts, and to ennoble and embellish human life.' Now that’s power worth seeking."

On Success:
“In today’s business world, I fear, our leaders have sought the wrong kind of success, and indeed too often engaged in over-reaching that is unethical and even illegal. If my generation has taken business and finance down the wrong track—and we have—it is a betrayal of the values of capitalism that have helped create the greatest global prosperity and well-being in all human history.

“For your generation, our failure is your opportunity—the opportunity of a lifetime to restore integrity to capitalism, to replace egotism with idealism. We’re all in the human race together, and those of us who are lucky enough to earn a good living through our business careers must, as we run the long race of a life well lived, do our best to serve our fellow man.”