For the millions of people who voted for the Berkshire Hathaway Annual Meeting, careful viewers were rewarded with an unexpected news: Who will be the next CEO of the company.
In response to a question Saturday about whether the company would ultimately be too complex to manage, Berkshire Vice President Charlie Munger made a comment that, at least on the surface, was not so surprising.
“Greg wants to preserve the culture,” the 97-year-old Munger said simply, explaining that the decentralized nature of the company would survive him and Warren Buffett.
But that was enough to get hold of some Berkshire overseers who have wondered about succession plans at the conglomerate when 90-year-old chairman and CEO Buffett is no longer in charge. For many, it signaled that the top job would go to Vice President Greg Abel, who runs all the non-insurance activities.
The impression was accurate, CNBC can confirm.
“The directors agree that if anything were to happen to me tonight, it would be Greg who took over tomorrow morning,”
Greg Abel at Berkshire Hathaway’s annual meeting in Los Angeles California. May 1, 2021.
Gerard Miller | CNBC
Both had been considered being over the top job since they were promoted to vice presidents in 2018. “If, heaven forbid, anything happened to Greg tonight, it would be Ajit,” Buffett said, adding that age is a crucial factor for the board. Abel is 59 and Jain is 69. “They are both wonderful guys. However, the likelihood of someone having a 20-year runway makes a real difference.”
The question of who would take over after Buffett has been a source of speculation for over 15 years. For years, it was assumed that Buffett’s successor would be David Sokol, who led MidAmerican Energy, now called Berkshire Hathaway Energy, and NetJets for Berkshire. But Sokol left Berkshire in 2011 after it was revealed he had taken over a $ 10 million stake in the chemical company Lubrizol shortly before recommending Berkshire to buy the company.
From Buffett’s perspective, Munger simply acknowledged what has been common practice for the board. “We at Berkshire have always basically had a unanimous agreement on who should take over the next day,” Buffett said. “The world is putting more emphasis now.”