Warren Buffett
About Warren Buffett
Warren E. Buffett, age 94, is Berkshire Hathaway’s Chairman and Chief Executive Officer (since 1970) and its controlling shareholder (director since 1965) . He concurrently serves as Board Chair and CEO—an arrangement the Board supports given his status as an active controlling shareholder; Susan L. Decker serves as Lead Independent Director to bolster independent oversight . Five-year performance context disclosed in Berkshire’s Pay vs. Performance section shows cumulative TSR from 12/31/2019 to 12/31/2024 of 100.5%, while management highlights 164% growth in “net operating earnings” over 2020–2024; Berkshire does not use performance metrics in executive pay decisions . Berkshire’s CEO pay ratio for 2024 was 4.94:1, reflecting Mr. Buffett’s longstanding $100,000 salary and absence of bonuses/equity awards .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Berkshire Hathaway Inc. | Chairman & CEO | 1970–Present | Long-tenured capital allocation and decentralized operating model; combined CEO/Chair with Lead Independent Director structure . |
| The Kraft Heinz Company | Director | Until Apr 2018 | External consumer-staples board perspective (ended 2018) . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| — | — | — | No current external public company directorships disclosed (prior: Kraft Heinz through Apr 2018) . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 100,000 | 100,000 | 100,000 |
| Bonus ($) | — | — | — |
| Stock/Option Awards ($) | None (Company never intends to use Berkshire stock for employee pay) | None | None |
| All Other Compensation ($) | 301,589 (personal/home security costs) | 313,595 (personal/home security costs) | 305,111 (personal/home security costs) |
| Total Compensation ($) | 401,589 | 413,595 | 405,111 |
| Additional Notes | Buffett reimbursed Berkshire $50,000 for minor personal items paid by the Company (e.g., postage/delivery) . He uses Berkshire aircraft only for business; personal travel via NetJets at standard rates . |
Key policy features:
- The Board’s Governance, Compensation and Nominating Committee reviews Buffett’s pay annually; per his request, it has remained $100,000 for 40+ years .
- Committee policy: do not consider Berkshire’s profitability or stock price in executive pay; do not use Berkshire stock for compensation .
Performance Compensation
Berkshire discloses no annual or long-term incentive plans for Mr. Buffett; no performance metrics, equity awards, or options are used in his compensation .
| Metric | Weighting | Target | Actual | Payout | Vesting |
|---|---|---|---|---|---|
| Not applicable (no bonus, no equity, no options) | — | — | — | — | — |
Pay versus performance disclosure notes Berkshire does not use financial performance measures to set CEO or NEO pay .
Equity Ownership & Alignment
| Class | Shares Beneficially Owned | % of Class | Aggregate Voting Power | Aggregate Economic Interest | Notes |
|---|---|---|---|---|---|
| Class A | 206,359 | 37.9% | 30.4% (aggregate voting power from A and B) | 14.4% (aggregate economic interest from A and B) | Voting agreement: if Buffett’s combined voting power exceeds 49.9%, he will vote the excess proportionally with other shareholders . |
| Class B | 951 | <0.1% | Included in above | Included in above |
Additional alignment details:
- No options, RSUs, PSUs, or other equity awards outstanding—Berkshire does not use stock for compensation .
- Pledging/hedging: Berkshire discloses an Insider Trading Policy but does not specify pledging prohibitions in this proxy; no pledges by Mr. Buffett are disclosed here .
- Ownership guidelines: not disclosed (Berkshire generally eschews typical pay/ownership constructs) .
Employment Terms
| Item | Disclosure |
|---|---|
| Employment Agreement | Not disclosed for Mr. Buffett in this proxy . |
| Severance / Change-of-Control | Not disclosed; Berkshire’s materials contain no golden parachute terms for Mr. Buffett . |
| Non-Compete / Non-Solicit | Not disclosed . |
| Clawback Provisions | Not disclosed for executives in this proxy; a Code of Business Conduct and Ethics and Insider Trading Policy are noted . |
Board Governance
- Dual role: Buffett is CEO and Chairman; the Board concurs this is appropriate given his role as active controlling shareholder . Lead Independent Director (Susan L. Decker) supports independent oversight; she also provides succession-related board composition suggestions if Buffett is unable to serve .
- Risk oversight: The full Board oversees risk; Buffett is identified as Berkshire’s “chief risk officer” with the Audit Committee discussing policies for risk assessment/management .
- Board/Committee activity: Board actions occurred at the annual directors’ meeting and two special meetings; each director attended all meetings in 2024. Independent directors held three meetings in 2024 .
- Committees:
- Audit Committee: Decker (Chair), Davis, Weitz, Witmer; all independent and NYSE Rule 10A-3 compliant; six meetings in 2024 .
- Governance, Compensation & Nominating Committee: Burke, Chenault, Guyman, Murphy Jr.; all independent; sets CEO pay and provides broader governance oversight; one meeting in 2024 .
- Director age policy amended: generally ineligible for re-election after age 80, with exceptions for the CEO serving at the Board’s request and for 5%+ voting interest holders .
- D&O insurance: The Company does not provide directors and officers liability insurance to its directors .
Board service specifics for Buffett:
- Years of service on the Board: Director since 1965; Chair/CEO since 1970 .
- Independence status: Not independent (independent directors are explicitly listed and exclude Buffett) .
- Committee roles: Not listed as serving on Audit or Governance/Compensation/Nominating; these committees are composed of independent directors .
- Meeting attendance: 100% for all directors in 2024 .
- Executive sessions: 3 meetings of independent directors during 2024 .
Director Compensation (Context for Dual Role)
- Non-employee directors receive modest meeting-based fees; employees or spouses of employees (including Buffett) do not receive director fees .
- 2024 director fees for non-management directors ranged from $1,500 to $6,700 based on committee roles/meetings .
Performance & Track Record
| Year | Company TSR ($100 initial) | Peer TSR (S&P P&C Index) ($100 initial) | Net Earnings ($B) |
|---|---|---|---|
| 2020 | 102.42 | 106.96 | 43.3 |
| 2021 | 132.71 | 127.58 | 90.9 |
| 2022 | 138.01 | 151.66 | (22.0) |
| 2023 | 159.79 | 168.05 | 97.1 |
| 2024 | 200.51 | 227.67 | 89.6 |
Additional context:
- Management and the Board emphasize “net operating earnings” (net of realized/unrealized investment gains/losses) as more useful given GAAP volatility; disclosed growth to $47.4B in 2024 and 164% over five years .
- Berkshire notes difficulty of identifying a true peer group given its diversified structure; S&P P&C Index is used for Item 201(e) purposes .
Related Party Transactions (Governance Risk Indicators)
- Munger, Tolles & Olson LLP (partner: Berkshire Director Ronald L. Olson) provided legal services; Berkshire and subsidiaries paid $21.2 million in 2024 .
Compensation Committee Analysis (Process Signal)
- Governance, Compensation and Nominating Committee (independent directors) reviews CD&A and recommends inclusion in the proxy; it oversees CEO pay and broader governance .
- Policy emphasizes decentralized, business-specific incentives for subsidiary CEOs set by Vice Chairs (insurance vs. non-insurance), typically tied to controllable operating results; however, Buffett’s own pay remains a flat salary with no incentive plan and no equity .
Additional Governance Structure Notes
- Succession: Discussed at every Board meeting; Buffett states no family involvement in management after his death/incapacity, though a family member may serve as non-executive Chair subject to the then-Board’s decision .
- Communications: Shareholder engagement primarily via the extensive annual Q&A; Berkshire does not routinely conduct selective communications beyond filings and the Q&A forum .
- Insider Trading Policy and Code of Business Conduct and Ethics are posted; detailed pledging/hedging prohibitions not specified in this proxy .
Investment Implications
- Alignment: Buffett’s outsized, long-held ownership (approx. 30.4% voting power; 14.4% economic interest) and refusal of bonuses/equity awards minimize equity-vesting supply overhang and tightly align incentives with long-term value creation .
- Governance trade-offs: Combined CEO/Chair with controlling shareowner is mitigated by a Lead Independent Director, fully independent Audit and Governance/Compensation committees, and independent-only executive sessions (3 in 2024); still, control dynamics and no D&O insurance for directors are notable governance idiosyncrasies to monitor .
- Pay signals: Absence of variable or equity pay removes conventional pay-for-performance levers but also eliminates short-term incentive distortions; decentralized, results-driven incentives operate at the subsidiary level under the Vice Chairs’ oversight .
- Trading pressure: No stock/option grants to Buffett means no scheduled vesting-related selling; with no pledging disclosed here and a voting cap mechanism above 49.9%, forced-liquidity risk from executive compensation is structurally low, though philanthropic or estate-related dispositions are not addressed in this proxy .
- Key monitoring items: Succession execution and any changes to risk oversight structure; related-party legal services (magnitude and ongoing necessity); and Board independence/effectiveness given the unique shareholder-meeting-centric engagement model .