Tags: US | Berkshire | Hathaway | Executive | Compensation

Buffett's Salary at $519,490 as Security Costs Rise

Thursday, 11 Mar 2010 10:34 AM

Warren Buffett brought home less pay than Berkshire Hathaway's chief financial officer again last year, but the company is paying more to protect the billionaire these days.

Buffett, chairman and chief executive of the Omaha, Neb.-based company, received $519,490 total compensation in 2009, an increase of 6 percent, according the proxy statement mailed to shareholders this week. The reason Buffett's compensation grew is Berkshire spent $28,781 more on his security.

Berkshire's chief financial officer, Marc Hamburg, saw his compensation grow 11 percent, to $874,750 in 2009, to remain the top earner at the company's 21-person headquarters.

But Hamburg's pay is almost certainly less than the executives at some of Berkshire's subsidiaries, such as Geico and BNSF railroad. The salaries of executives at subsidiaries aren't disclosed.

Last year, Berkshire's net income soared 61 percent to $8.055 billion, or $5,193 per Class A share, on a big swing in the value of its investments and derivatives.

Buffett's company also completed its biggest acquisition ever last month when it bought Burlington Northern Santa Fe Corp.

Buffett's salary remains at the same level it's been at for more than 25 years: $100,000. He also continued to receive $75,000 in director's fees from the Washington Post Co., which Berkshire discloses because it holds a significant stake in the company.

But Berkshire said it spent $344,490 on Buffett's personal and home security in 2009. That's up 9 percent from the $315,709 it spent the previous year.

Buffett favors simple compensation arrangements and incentives tied to things that executives can control, not Berkshire's stock price or profitability.

So most of the things The Associated Press routinely includes in its executive compensation calculations don't exist at Berkshire, including bonuses, performance-related bonuses, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.

Berkshire Vice Chairman Charlie Munger's compensation remained unchanged in 2009. Munger, who runs Berkshire's Wesco Financial subsidiary in Pasadena, Calif., collected only a $100,000 salary.

In 2009, both Buffett and Munger reimbursed Berkshire again to cover any personal costs, such as postage or calls the company may have paid for. Buffett paid the company $50,000, and Munger reimbursed Berkshire $5,500.

Berkshire said the only formal business on the agenda for its annual meeting on May 1 will be the re-election of all 12 directors. There will be no shareholder proposals this year.

So people at the meeting, which attracted about 35,000 last year, will be able to focus on the comments Buffett and Munger make during their annual daylong question-and-answer session.

Berkshire owns roughly 80 subsidiaries, including clothing, furniture, jewelry and corporate jet firms, but its insurance and utility businesses accounted for more than one-third of the company's revenue last year. It also has major investments in such companies as Coca-Cola Co. and Wells Fargo & Co.

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Warren Buffett brought home less pay than Berkshire Hathaway's chief financial officer again last year, but the company is paying more to protect the billionaire these days.Buffett, chairman and chief executive of the Omaha, Neb.-based company, received $519,490 total...
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Thursday, 11 Mar 2010 10:34 AM
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