Tags: Buffett Sees Son Howard as ‘Safety Valve’ If Next CEO Falters

Buffett Sees Son Howard as 'Safety Valve' If Next CEO Falters

Saturday, 28 February 2015 03:47 PM

(Bloomberg) -- Warren Buffett said Berkshire Hathaway Inc. has a plan if his eventual replacement as chief executive officer isn’t up to the job.

Buffett’s son Howard, as non-executive chairman, will be able to deal with an underperformer, the billionaire said in a letter published Saturday for shareholders.

“If elected, Howard will receive no pay and will spend no time at the job other than that required of all directors,” Buffett wrote. “He will simply be a safety valve to whom any director can go if he or she has concerns about the CEO.”

Buffett, 84, used the letter to lay out his vision for Berkshire’s next decades, 50 years after he took over a struggling textile mill that he turned it into one of the world’s largest companies. He’s said the board spends a lot of time considering who the next CEO should be, though he hasn’t publicly named the candidates.

One of Howard Buffett’s roles as non-executive chairman will be to help preserve the company’s culture, the billionaire has said. The son, 60, has been a director since 1993 at Berkshire. Other board members include Microsoft Corp. co- founder Bill Gates and Comcast Corp. executive Stephen Burke.

At one time, Howard was head of investor relations for Archer-Daniels Midland Co. He lives and farms in central Illinois, and also runs the Howard G. Buffett Foundation, which works to improve subsistence agriculture and resolve conflicts tied to food.

Buffett said Saturday that he thinks there’s little chance that Howard will have to dethrone a bad chief executive at Berkshire.

“This problem has a very low probability of arising at Berkshire -- likely as low as at any public company,” Buffett wrote. “In my service on the boards of nineteen public companies, however, I’ve seen how hard it is to replace a mediocre CEO if that person is also chairman.”

--With assistance from Noah Buhayar in Seattle.

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net To contact the editors responsible for this story: Dan Kraut at dkraut2@bloomberg.net Sylvia Wier

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Buffett Sees Son Howard as ‘Safety Valve’ If Next CEO Falters
Buffett Sees Son Howard as ‘Safety Valve’ If Next CEO Falters
Saturday, 28 February 2015 03:47 PM
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