After 60 years running Berkshire Hathaway, Warren Buffett will step down at the end of the year.
After 60 years at the helm of Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B), legendary investor Warren Buffett announced to shareholders Saturday that he is stepping down as CEO at the end of this year.
“The time has arrived where Greg [Abel] should become the chief executive officer of the company at year end and I want to spring that on the directors and effectively give that as my recommendation,” Buffett said at the annual shareholders meeting Saturday in Omaha during the question-and-answer session.
It comes as no surprise that the 62-year-old Abel, Berkshire Hathaway’s vice chair of non-insurance operations, is succeeding Buffett as CEO, as that was announced back in 2021. The question was: When would Abel take over? Now we know.
Abel named successor
It was made official on Monday, May 5, when the board voted unanimously to appoint Abel as president and CEO of Berkshire Hathaway, effective January 1, 2026. Buffett, age 94, will remain the chairman of the board at Berkshire.
“That would mean at year end, Greg would be the chief executive officer of Berkshire, and I would still hang around and conceivably still be useful in a few cases, but the final word would be what Greg says in operation and capital deployment, or whatever it might be,” Buffett said at the meeting.
Abel, born in Edmonton, has been with Berkshire Hathaway since 1999 when Berkshire acquired a controlling interest in the company he ran, Mid-American Energy, which later became Berkshire Hathaway Energy. He then became vice chair of non-insurance operations in 2018.
“I couldn’t be more … humbled and honored obviously to be in this role,” Abel said at the meeting, “but to actually be part of Berkshire for, Warren, it’s now 25 plus years, and to have the opportunity to be part of Berkshire and to work with you and Ajit [Jain, vice chairman] and our board and the many other people in our company. As you touched on, when you find something like Berkshire that is so special, you fall in love with it because it’s what you want to do every day. It’s just an incredible opportunity, so thank you.”
Find your sound
Warren Buffett acquired a small textile mill in New Bedford, Mass. in 1965 and 60 years later, Berkshire Hathaway is the eighth largest company in the world with a market cap of about $1.1 trillion.
At the meeting, Buffett discussed some important aspects of the company’s success over the years.
“It does take a long, long time and it takes getting around you a small cadre of people which then spreads out somewhat, but you’ve got mutual trust where people do more than their share,” Buffett said. “If you find people that are wonderful to work with, that’s the place to go.”
The Oracle of Omaha also said that he was fortunate to find what interested him at a young age, seven or eight years old. He called it, finding the sound.
“It could have taken a lot longer, but you want to find the sound,” he said. “There’s a movie called The Glenn Miller Story and Glenn Miller went from having a broken-down band for 15 years until he ʻfound the sound,ʻ and created the first gold record.”
That first gold record, Buffett explained, was Chattanooga Choo-Choo in 1941.
“I have told my kids ever since then, and their sound isn’t my sound, that you don’t find it necessarily on the first job you take because you’ve got to eat, but if you get lucky like I did, you find it when you’re very young,” Buffett said.
A wonderful life
On the succession to Abel, Buffett said, “you can’t even dream all the dreams that you could have about a place like Berkshire, but you have to be sure you can play the next day … You don’t want to do anything that risks what’s been created. If very stupid things are happening around you, you do not want to participate.”
While it won’t be the last that we hear from Buffett, as he will stay on as chairman, this marks the last time he’ll be presiding over the annual meeting, making it truly the end of an era.
“Now I’ve come along to do something where I can just play around all day with things I enjoy doing, and its really a pretty wonderful life.”
