(Bloomberg)-Warren Buffett's appointed offspring has built a billion dollars in his time in Berkshire Hathaway Inc., but unlike the legendary investor-apo Early friends and supporters which became a rich spectacular during his six-decade-relevant jogging is a little linked to enterprise actions.
Greg Abel, 62, who will replace Buffett as the Berkshire chief executive at the end of the year, holds shares worth about $ 175 million. This accounts for about 18% of its net worth of $ 1 billion, according to the Bloomberg Billionaire index, which is estimating its wealth for the first time.
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Much of his wealth stems from the revenue of a 2022 stock purchase in which Berkshire bought his $ 870 million in Berkshire Hathaway Energy, a branch of full ownership that Abel ran from 2008 to 2018.
Its Berkshire properties are about one -and -a thousand values of the $ 160 billion Buffett shares. They are also significantly less than that of other non-found CEOs of trillion dollars, including Tim Cook, whose $ 651 million Apple Inc. Shares make up about 38% of its net value, or Sundar Pichai, $ 338 million whose Alphabet Inc. holding 33% of his wealth.
Abel did not respond to a comment request.
Berkshire long observers under the administration of Buffett are wondering whether Abel will make changes when taking over, starting with the expansion of the company's famous C-SUITE to rebuild which businesses are concentrated by Berkshire. The relatively small shares of Abel can also ask whether it will change the structure of the upper berkshire management wages or the double grade stock structure of the company.
Since Abel was promoted in a vice president in Berkshire in 2018, he earned about $ 20 million a year in the form of salary and bonus. Like the rest of Berkshire's upper management, he has never been given any capital as part of his compensation package during that time. He bought his shares in Berkshire with his money in 2022 and 2023, after collecting his energy shares.
'Make questions'
For years, Buffett, 94, has personally imposed the annual compensation of other old leaders and received a $ 100,000 nominal salary for himself. He also owns more than one third of the company's Class A stock, which have 10,000 times the voting power of the most common shares B.
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“When Buffett was running it, some sometimes questioned the double grade structure and little questioned his salary-he was so invested in that thing,” Charles Elson, the founding director of the Weinberg Center for the University of Delaware Corporate Governance in an interview. “Once you bring a new person to it is not the founder, people start asking questions.”
To be sure, Abel's Berkshire actions are not uncommon when looking at the full range of publicly traded companies. A 2018 study Harvard Law School for Corporate Governance Forum revealed that more than half of the Russell Index CEO held less than 1% of their company's unpaid shares, with only 3.6% holding more than 25%. (Abel holds 0.0002% of the excellent Class A and Class B shares of Berkshire.)
Abel can also receive a share of shareholders and the Berkshire Board, which could hesitate to shake a payment structure that constantly gives them unpaid returns for decades.
“Why will they now, simply because Warren is leaving, trying to find a way to extinguish himself in a payment structure that certainly doesn't work so well for other companies?” Said Dan Walter, a compensation adviser at the Alliant Capital Human advisory firm. “If your shareholders are making big returns, they almost never care about how many people who generate those returns are paid.”