Berkshire Hathaway CEO Warren Buffett on Tuesday donated $866 million in Berkshire stock to four charities, making sure the company has the right CEO and the right board to succeed him. He said there was.
Berkshire has named Berkshire Vice Chairman Greg Abel, who heads the company’s non-insurance business, as a potential successor to Buffett.
Buffett also said his three children, Howard, Susan and Peter Buffett, will be his executors and trustees of a charitable trust that will receive nearly all of his estate. This appears to be a new disclosure by Buffett.
“My three children are my current executors as well as designated trustees of a charitable trust that receives over 99% of my estate pursuant to the provisions of my will.”
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“In 2006 they were not fully prepared for this incredible responsibility, but now they are.” No. Since mortality is random, a successor must always be designated.”
Their three children are between 65 and 70 years old, and Howard and Susan Buffett are on Berkshire’s board of directors. Buffett began giving away his Berkshire stock in 2006 and has donated more than half of his stock since then. The majority of the donations went to the Bill & Melinda Gates Foundation.
Buffett currently owns 15% of Berkshire stock (approximately 216,687 Class A shares and 344 Class B shares), valued at $118 billion. Berkshire’s Class A stock (BRK.A) was little changed on Tuesday at $547,625, while its Class B stock fell 0.1% to $361. With Tuesday’s donation, Buffett converted 1,600 Class A shares into 2.4 million Class B shares.
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Reflecting his business and giving philosophy, Buffett wrote that the trust would self-liquidate and be understaffed in about 10 years. Buffett has no interest in creating a long-term philanthropy like the Ford Foundation. His view is that his wealth should be distributed relatively soon after his death to maximize its impact. Buffett hates bureaucracy and runs Berkshire with a small head office staff in Omaha.
“My children, along with their father, share the belief that dynastic wealth, although legal and common in many parts of the world, including the United States, is undesirable. , we’ve had many opportunities to observe that capitalism doesn’t make you any smarter or worse. I agree that whatever its weaknesses, it has done wonders so far and will continue to do wonders.”
“The Testamentary Trust will be self-liquidating in about 10 years and will be run by a small staff. To the extent possible, it will be funded by Berkshire stock. One of the largest and most diversified companies in the world. At Berkshire, we inevitably encounter human errors in judgment and action. They occur in all large organizations, public or private. is unlikely to be serious and will be recognized and corrected. We have the right CEO to succeed me and we have the right board of directors. We need both.
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“In the short term, Berkshire’s unique characteristics and actions will be supported by my large Berkshire stock. But over time, Berkshire will gain the reputation it deserves. Government Decline can occur in large organizations of all kinds: institutions, charities, for-profits. But it’s not inevitable. Berkshire’s advantage is that it’s built to last. .”
“After my death, the disposition of my assets will be in a public record, not in an ‘imaginary’ trust or foreign corporation to avoid public scrutiny, but in a simple document that can be viewed in the Douglas County Courthouse.” It becomes a will. “
Email Andrew Bary at andrew.bary@barrons.com.
