Berkshire's Succession Announcement Is Step One of Five (or More) Steps to Come
by Lawrence Cunningham
On Saturday, Warren Buffett announced that he will retire as CEO of Berkshire Hathaway at year end, formally naming Greg Abel as his successor in that role. Commentators rightly extol Buffett’s unique leadership, investment acumen, and cultural stewardship—qualities that will be missed. But when tributes veer into predictions that Berkshire Hathaway’s best days are behind it, they overlook Buffett’s greatest legacy: an organization designed to outlast him.
This succession plan is not a single move. It’s a multi-step transition of leadership and trust—carefully constructed over decades—to ensure the survival of a distinctive business model. The announcement of Abel’s ascension is only step one.
Step One: Chief Executive Officer — Greg Abel
As CEO, Abel will oversee Berkshire’s sprawling operations, deploy capital, and serve as its public face. He’s already doing much of that. He has earned the respect of Berkshire’s subsidiary managers, navigated acquisition markets, and presented with calm command at several recent shareholder meetings. Abel has overseen billions in investments at Berkshire Hathaway Energy and has taken point on the company’s sizable Japanese holdings.
While Abel shares Buffett’s emphasis on decentralization and autonomy, he is known to be less tolerant of underperformance. He is not a showman—and won’t pretend to be. Instead, Abel may choose new ways to connect with shareholders, perhaps by featuring a rotating cast of Berkshire subsidiary CEOs on stage at the annual meeting.
Step Two: Chief Investment Officers — Todd Combs and Ted Weschler
Buffett will no longer serve as Berkshire’s chief investment officer. In his later years, he increasingly relied on others, including Ted Weschler, who is likely to manage the equity portfolio along with additional like-minded investors. Abel will be accountable for overall results but will rely heavily on on the stock-picking expertise of those Berkshire teammates.
Step Three: Insurance — Ajit Jain and Successors
Abel is not an insurance man—and he knows it. Berkshire’s insurance operations remain under the leadership of Ajit Jain, who serves as vice chairman and head of insurance operations. Jain’s deep experience and bench of internal successors ensure continuity at the company’s core businesses, from GEICO to GenRe and including Alleghany.
Step Four: Board Chair — Warren, Then Howard Buffett
For the first time in Berkshire’s history, the roles of chairman and CEO will be split. Warren Buffett will remain chairman of the board, retaining significant influence while Greg runs the company day to day. Upon Warren’s death, the longstanding plan remains for his son, Howard Buffett, to succeed him as chairman.
That role is widely misunderstood. Howard will not be a shadow CEO or investment chief. Instead, he’ll serve as cultural guardian, with a mandate to preserve the values that make Berkshire unique: permanence, autonomy, and promise-keeping. Unlike many sons of legendary founders, Howard will not try to fill his father’s shoes—but to keep them from being trampled.
Step Five: Controlling Shareholder — Warren Buffett, Then the Shareholder Base
Buffett emphasized Saturday that he will not sell a share of Berkshire stock. His continued ownership gives Abel formidable protection from shareholder activism for as long as Buffett lives. When he dies, his estate plan calls for a gradual transition: his Class A shares—with their high voting power—will be converted into Class B shares and sold into the market over a ten-year period.
The result will be twofold: Buffett’s direct influence will wane, but the relative voting power of other long-term Class A shareholders will rise. That base—known for its loyalty to the Berkshire model—will then play the decisive role in sustaining it.
Of course, nothing is automatic. These structures and safeguards are not self-enforcing. Long-term shareholders will support the model only if its performance justifies continued trust. But that’s as it should be. Berkshire’s durability was never about blind loyalty. It has always rested on mutual respect and earned trust.
The Real Question: Will the Model Endure?
Berkshire’s model challenges conventional corporate practice. It resists short-term pressures, avoids dividends unless reinvestment returns are inferior, and refuses to overpay for buybacks. It operates as a conglomerate while conglomerates fall out of fashion, and piles up cash while others rush to distribute it. Buffett and Berkshire have proven that these features, once seen as eccentric and even now often underappreciated, are icons of a rational, long-term capitalism.
Whether that model survives will not depend on Greg Abel alone—or on Weschler, Jain, or even Howard Buffett. It will depend on shareholders. Do they still believe in a model based on trust? One that says a great business can be owned, not flipped; guided, not gamed?
If they do, Berkshire will continue to thrive—not because of Warren Buffett’s genius, but because of what he built to outlast it. My money is on them.
