Buffett successor Abel seen preserving Berkshire’s culture

(Reuters) — When Greg Abel succeeds Warren Buffett at the helm of Berkshire Hathaway, he is expected to preserve the culture at the behemoth even if he does not match the star power of his legendary boss.

A 25-year Berkshire veteran, Vice Chairman Abel, 61, is expected by investors and analysts to uphold the $865 billion conglomerate’s track record of investing in companies for the long haul and eschewing dividend payments to shareholders.

Berkshire, which owns insurance companies, railroads and an ice-cream maker, has been planning for decades for the eventuality when Mr. Buffett, 93, who has run the company since 1965, is no longer there.

Even though Mr. Buffett has shown no signs of wanting to step aside, investor focus on Berkshire’s future came to the fore again after Charlie Munger, Mr. Buffett’s long-time friend and business partner, died in November at age 99. At Berkshire’s annual shareholder meeting in Omaha on Saturday, investors questioned Mr. Buffett and Mr. Abel about succession.

“We have a very special company in Berkshire, but it’s that culture that makes it special, and that’s not going to change,” Mr. Abel, who was designated Mr. Buffett’s successor as CEO in 2021, said at the shareholder meeting.

Mr. Buffett repeatedly assured shareholders that Berkshire is in good hands, saying that Mr. Abel is “in charge of really everything except insurance” these days.

“We (have) got the same feeling in terms of judging the attractiveness of businesses and making capital decision and that sort of thing,” Mr. Buffett said.

That sentiment was echoed by Ronald Olson, a Berkshire director.

“Greg understands the (Berkshire) culture and he will honor that,” Mr. Olson said ahead of the meeting. “Greg doesn’t think of himself as Warren Buffett, but I have no doubt seeing Greg running (Berkshire) the same way.”

Mr. Buffett conceded on Saturday that Mr. Abel is a tougher boss.

“We haven’t had a history of being very tough on people that coasted and we’ve had some that would do that,” Mr. Buffett said. “Greg will do something about it and Charlie and I wouldn’t have.”

According to Berkshire’s succession plan, Mr. Abel will replace Mr. Buffett in making all major investment and capital allocation decisions. Vice Chairman Ajit Jain, who joined Berkshire in 1986 will oversee insurance operations.

Mr. Buffett said Saturday he would want Mr. Abel to have final say on decisions regarding Berkshire’s portfolio of public stocks.

Mr. Buffett indicated Saturday that his subordinates are already taking on much more of the day-to-day responsibility.

“The number of calls I get from managers is essentially awfully close to zero and Greg is handling those,” Mr. Buffett said. “I don’t know quite how he does it, but we’ve got the right person, I can tell you that.”