Four candidates now on the list to replace Buffett
By Josh Funk |
March 2, 2011, Wednesday
|
Print Edition
Print Edition
THE pool of internal candidates to eventually replace Warren Buffett as Berkshire Hathaway's chief executive has expanded to four, the company said in a regulatory filing on Monday.
The revered 80-year-old investor has said for several years that the Omaha-based company had three internal candidates to replace him as CEO someday, but has refused to name them. The new details about Berkshire's succession plan emerged two days after the company released Buffett's annual letter to shareholders.
Berkshire plans to split Buffett's job into three parts - chief executive officer, chairman and several investment managers.
Buffett remains in good health and has no plans to retire, but he says Berkshire's board regularly discusses succession and knows who it would pick as CEO if the need arises.
Buffett's assistant Carrie Kizer said he was traveling on Monday and would not be immediately available to comment.
The revelation about a fourth candidate reinforces speculation that Burlington Northern Santa Fe CEO Matt Rose became a contender after Berkshire acquired the railroad last year.
The other Berkshire managers believed to be on the short list are David Sokol, chairman of NetJets and MidAmerican Energy; Ajit Jain, who runs Berkshire's reinsurance division; Greg Abel, president and CEO of MidAmerican Energy; and Tony Nicely, chief executive of Geico.
Berkshire shareholder Glenn Tongue, who is a managing partner at the T2Partners investment firm, said he's satisfied with the company's succession planning and the details Buffett has disclosed. He said naming the CEO candidates could actually be counter-productive because executives who were left off the list might be discouraged.
"I think he's walked the line on succession planning exactly appropriately," Tongue said.
Buffett says his primary responsibilities at Berkshire are deciding how best to invest the company's cash and keeping key managers of Berkshire subsidiaries happy. Buffett consults with 87-year-old Vice Chairman Charlie Munger on all major decisions.
But Buffett and Munger employ a remarkably hands-off approach to managing Berkshire's roughly 80 subsidiaries. Berkshire's insurance, furniture, utility, jewelry, clothing, carpet and other companies largely operate independently of Berkshire's 21-person headquarters.
The revered 80-year-old investor has said for several years that the Omaha-based company had three internal candidates to replace him as CEO someday, but has refused to name them. The new details about Berkshire's succession plan emerged two days after the company released Buffett's annual letter to shareholders.
Berkshire plans to split Buffett's job into three parts - chief executive officer, chairman and several investment managers.
Buffett remains in good health and has no plans to retire, but he says Berkshire's board regularly discusses succession and knows who it would pick as CEO if the need arises.
Buffett's assistant Carrie Kizer said he was traveling on Monday and would not be immediately available to comment.
The revelation about a fourth candidate reinforces speculation that Burlington Northern Santa Fe CEO Matt Rose became a contender after Berkshire acquired the railroad last year.
The other Berkshire managers believed to be on the short list are David Sokol, chairman of NetJets and MidAmerican Energy; Ajit Jain, who runs Berkshire's reinsurance division; Greg Abel, president and CEO of MidAmerican Energy; and Tony Nicely, chief executive of Geico.
Berkshire shareholder Glenn Tongue, who is a managing partner at the T2Partners investment firm, said he's satisfied with the company's succession planning and the details Buffett has disclosed. He said naming the CEO candidates could actually be counter-productive because executives who were left off the list might be discouraged.
"I think he's walked the line on succession planning exactly appropriately," Tongue said.
Buffett says his primary responsibilities at Berkshire are deciding how best to invest the company's cash and keeping key managers of Berkshire subsidiaries happy. Buffett consults with 87-year-old Vice Chairman Charlie Munger on all major decisions.
But Buffett and Munger employ a remarkably hands-off approach to managing Berkshire's roughly 80 subsidiaries. Berkshire's insurance, furniture, utility, jewelry, clothing, carpet and other companies largely operate independently of Berkshire's 21-person headquarters.
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