Berkshire Hathaway 2017 Annual Meeting Audience Question # 24

Less mention of top performing managers by name in the annual report doesn’t mean anything

Warren Buffett:

OK. Jay?

Jay Gelb:

This question is on the topic of succession planning.

Warren, there seem to be fewer mentions, by name, of top-performing Berkshire managers in this year’s annual letter. Does this mean you’re changing your message regarding the succession plan for Berkshire’s next CEO?

Warren Buffett:

Well, the answer to that’s no. And I didn’t realize there were fewer mentions by name.

I write that thing out and send it to Carol, and she tells me, “Go back to work.”

I don’t actually think that much about how many personally get named.

I would say this. And this is absolutely true. We have never had more good managers… now, it’s because we’ve got more good companies… but we have never had more good managers than we have now, so I… but it has nothing to do with succession.

Charlie?

Charlie Munger:

Well, I certainly agree with that. We don’t seem to have a whole lot of 20- year-olds.

Warren Buffett:

Certainly not at the front table.

No, we’ve got an extraordinary group of good managers, which is why we can manage by abdication.

It wouldn’t work if we had a whole bunch of people who were… had come with the idea of getting my job. I mean, if we had 50 people out there, all of who wanted to be running Berkshire Hathaway, it would not work very well. And…

But they have the jobs they want in life. Tony Nicely loves running GEICO. You know, it… then you go down the line. They have jobs they love.

And that’s a lot better, in my view, than having a whole bunch of them out there that are kind of doing their job there kind of hoping the guys competing with them will fail so that, when I’m not around, that they’ll get the nod.

It’s a much different system than exists at most American corporations.

Charlie, got anything?

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