Berkshire Hathaway's board to be requested by Warren Buffett to designate Greg Abel as CEO, effective year-end.
Warren Buffett Stepping Down: Here's What You Need to Know
Get ready for a change at the top! At this year's Berkshire Hathaway shareholder meeting, the legendary investing guru Warren Buffett announced that he will soon step down as CEO.
Despite being 94 and officially designating Greg Abel as his successor in 2021, the announcement still sent shockwaves through the crowd of 40,000 admiring shareholders.
"Tomorrow, we're having a board meeting of Berkshire, and we have 11 directors. Two of the directors, who are my children, Howie and Susie, know of what I'm going to talk about there. The rest of them, this will come as news to, but I think the time has arrived where Greg should become the chief executive officer of the company at year end," said Buffett, who has run the former textiles company since 1965.
While Buffett plans to hang around and help wherever he can, the final word on company operations and capital deployment will be with Abel, who is currently the Vice Chairman of non-insurance operations for Berkshire.
Buffett has high praise for Abel, saying his more hands-on management style is working better for Berkshire's 60-plus subsidiaries. Abel is based in Des Moines, Iowa, and has been with Berkshire for a solid 25 years.
So what's next for Buffett? It's not clear whether he will also assume the Chairman role after stepping down as CEO. In an interview with the Wall Street Journal earlier this year, Buffett hinted that his son, Howie Buffett, would become the nonexecutive Chairman after his death to preserve the company culture. Details
Buffett and Abel told CNBC's Becky Quick after the meeting that they would discuss Buffett's new role at the upcoming board meeting. View the interview
As for Greg Abel, he joined Berkshire in 2000 when the conglomerate bought MidAmerican Energy, where he eventually became the CEO in 2008. Before Berkshire, Abel worked at CalEnergy where he transformed the small geothermal firm into a diversified energy business. More on Abel's career
The final act of the meeting? A standing ovation for Buffett, who showed surprising energy and clarity for his age as he answered questions for four hours. The future may be uncertain, but one thing is clear: Warren Buffett has left an indelible mark on the world of finance. Stay tuned for updates on this developing story!
- The successor to Warren Buffett as CEO of Berkshire Hathaway, Greg Abel, has a background in finance, having previously transformed a small geothermal firm into a diversified energy business.
- Buffett's stepping down as CEO does not necessarily mean he will be leaving the company entirely, as he has hinted that his son, Howie Buffett, may become the nonexecutive Chairman after his death, to preserve the company culture.
- Abel's new role as CEO will involve making decisions on capital deployment and business operations, a responsibility he has been preparing for over his 25-year tenure at Berkshire Hathaway.
