Warren Buffett says he stepped down from Berkshire Hathaway because he finally felt old

Warren Buffett told The Wall Street Journal that giving up the CEO role at Berkshire Hathaway wasn’t planned out months in advance or tied to one specific day. He said there was no single moment that triggered the decision.

He just slowly started realizing that Greg Abel, the man he picked to take over, had more energy. Warren said their work rhythms weren’t matching anymore. Greg was going full speed. He wasn’t. That gap kept getting wider until he couldn’t ignore it.

“There was no magic moment,” Warren said. “How do you know the day that you become old?” He’s 94 now, and he said he didn’t even start feeling old until he hit 90. But once that switch flipped, there was no going back.

He mentioned losing his balance sometimes, forgetting names here and there, and noticing that newspapers started looking like they were printed in light gray instead of black. Even reading felt different. He said aging is “irreversible.” Those issues started building up over the past year, and by the time the annual meeting came around, he had made up his mind.

Buffett shocked shareholders by naming Greg Abel as new CEO

On May 3, during the final part of Berkshire’s annual shareholder meeting in Omaha, Warren said he would step down as CEO in December. He announced it casually, right near the end of the Q&A, and the room froze. Then people clapped. Even Greg, who was on stage with him, didn’t know the announcement was coming. It hit everybody at once.

Warren will still stay on as chairman of the board, and he hasn’t set a date to leave that job. He said he still comes into the office every day and enjoys being around the people there. “My health is fine, in the sense that I feel good every day,” he said. “I’m here at the office and I get to work with people I love, that they like me pretty well, and we have a good time.”

Greg, who’s now 62, got to Berkshire when Warren invested in MidAmerican Energy in 1999. The company was based in Des Moines, Iowa, and Greg had a strong track record there. Warren eventually made him vice chairman in 2018, letting him oversee all noninsurance operations.

By 2021, Greg had been selected as Warren’s future replacement, over his own biological children, who, by the way, fully support the decision.

Warren explained the decision by saying, “Really great talent is rare. It’s rare in business. It’s rare in capital allocation. It’s rare in almost every human activity you can name.” He added that Greg just got more done in a single day than he could.

“The difference in energy level and just how much he could accomplish in a 10-hour day compared to what I could accomplish in a 10-hour day—the difference became more and more dramatic,” said Warren. “He just was so much more effective at getting things done, making changes in management where they were needed, helping people that needed help someplace, but just all kinds of ways.”

Buffett says he’ll still be around as Abel prepares to lead

Warren said it felt unfair to delay Greg’s promotion any longer. “It was unfair, really, not to put Greg in the job,” he said. “The more years that Berkshire gets out of Greg, the better.”

Warren first took control of Berkshire in 1965 when it was just a failing textile company. He was 34 at the time. Now, nearly 60 years later, the company owns insurance businesses, utilities, a major railroad, and famous brands like Dairy Queen and Duracell. Its stock portfolio is huge, with major holdings in Apple and American Express. Today, Berkshire has about 400,000 employees.

He said the company has changed, and the job has changed with it. What’s needed now is someone who can move fast, talk to multiple teams, and manage it all at scale. That’s where Greg comes in.

Warren doesn’t think of himself as someone who should lead forever. “I thought I would remain CEO as long as I thought I was more useful than anybody else, in terms of being CEO,” he said. “And it surprised me, you know, how long it went.”

Even now, Warren still feels sharp when it comes to investing. He said, “I don’t have any trouble making decisions about something that I was making decisions on 20 years ago or 40 years ago or 60 years. I will be useful here if there’s a panic in the market because I don’t get fearful when things go down in price or everybody else gets scared. And that really isn’t a function of age.”

Source