Billionaire investor Warren Buffett, 94, announced that he would step away from Berkshire Hathaway by 2025-end and named designated-successor Greg Abel, 62, as the next CEO of the $1 trillion company.
The retirement announcement came during the company’s annual general meeting on May 3. It was a surprise move that Warren Buffett said, no one but the board and his children Susie and Howie Buffett knew.
“I think the time has arrived where Greg should become the Chief Executive Officer of the company at year end,” Warren Buffett said, repeating his view from earlier this year, that it is time for him to hand over the reins.
Who is Greg Abel, next CEO of Berkshire Hathaway?
A Canadian, who grew up in Edmonton (Alberta) and played hockey, Greg Abel has long been among Warren Buffett’s close aides at Berkshire Hathaway, according to an AP report. Greg Abel lives two hours away from Warren Buffett in Des Moines Iowa. He is expected to continue living there.
Since 2018 he has held charge of BNSF, Berkshire’s railroad company, food brands Dairy Queen and See’s Candies, and other manufacturing and retail businesses. He has been Warren Buffett and now late Charlie Munger’s designated successor to the CEO role since 2021.
Lowkey and out of the spotlight, Greg Abel interacted with the media when he made appearances at Berkshire annual meetings and interviews alongside Warren Buffett. And while he is Warren Buffett and Charlie Munger’s choice, the board is expected to vote on and confirm his ascent by 2025-end.
In a rare interview in 2018, Greg Abel spoke about his work ethics. “I think hard work leads to good outcomes. In my schooling, in sports, and in my business positions, I learned that if I put in a lot of work and was well-prepared, then success would be more likely,” he said.
The Oracle of Omaha expects the board vote will be unaimous, once stating that the company is “so damn lucky” to have the executive, the report added.
What Challenges Will Greg Abel Face?
Greg Abel will take over the conglomerate’s various businesses which employ 4,00,000 employees and a huge stock portfolio. Warren Buffett and Charlie Munger over the years have indicated they expect him to “preserve” Berkshire’s decentralised culture, with emphasis on “independence, integrity, and trust”, the report noted.
On expectations the report noted that while he has “big shoes to fill”, no one expects the executive to match Warren Buffett’s performance.
Ron Olson, a member of the Berkshire board believes that Greg Abel is ready, stating: “Is he another Warren Buffett? No, there is no other Warren Buffett that I know. But he has so many of the fundamentals of Warren. He is for sure high integrity. He is a hard worker. He is a strategic thinker.”
Dairy Queen CEO Troy Brady told AP that the executive “has high business acumen and really high business instincts”; while executives at Berkshire held shoemaking company Brooks Running said they already rely on Greg Abel when faced with challenges.
Why Warren Buffett’s son won’t be CEO
Notably, in what was among the greatest wealth transfers in modern history, Warren Buffett’s three children — Susie (71), Howard (70), and Peter (66) — were given $140 billion of his Berkshire stocks.
The stakes all three hold are assigned to philanthropic causes, which means Warren Buffett’s children will not inherit most of their father’s fortune. Susie Buffett has been on the board of directors since 2021, Howie has held a position on the board for over 30 years.
The handover plan has been in the works for “decades” and second child Howie is set to take over as non-executive chairman of Berkshire Hathaway from Warren Buffett, according a Wall Street Journal (WSJ) report in January. He has been tasked with “maintaining the culture”, it added.
