Warren Buffett ends rocky week by announcing heir apparent
As Warren Buffett's public profile took some rare hits, the 'Oracle of Omaha' moved Saturday to shore up Berkshire Hathaway's future by locating a successor.
In announcing, though not naming, a successor at Berkshire Hathaway, US billionaire Warren Buffett moved Saturday to shore up concerns about the future of his investment firm amid rare criticisms of a man seen by many as a model baron of industry.Skip to next paragraph
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Hailed for promoting his Giving Pledge, a promise by the super-rich to donate their wealth to charity after their deaths, and commended more recently by many Democrats for his call for wealthy investors to pay the same tax rate as middle-class Americans, Buffett has become the paragon of a billionaire with a heart.
Buffett's announcement to shareholders on Saturday that he had found a specific successor to run Berkshire Hathaway after his retirement or death came after a fourth quarter that saw Berkshire profits drop by 30 percent, largely because of bets on volatile real estate derivatives.
While the firm, which owns over 70 companies – from railroads to chocolate-makers -- and also invests in Wall Street stocks, outpaced the Standard & Poor's average for the 39th year in a row, uncertainty about succession at the company has, according to some experts, plagued its worth.
Buffett said in a 22-page letter to shareholders on Saturday that he has no plans to leave the company, but that the board of directors has agreed on a specific person to run the firm once Buffett steps down. Buffett wrote that "when a transfer of responsibility is required, it will be seamless, and Berkshire's prospects will remain bright."
Outside of Wall Street, Buffett's public persona has grown over the last year as he's emerged as a key economic adviser to President Obama, who named a plan to raise the tax rate for investment income over $1 million to mirror payroll tax rates for the middle class the “Buffett Rule.” Buffett, who received the Medal of Freedom from Obama last year, famously said he shouldn't pay taxes at a lower rate than his secretary.
The proposal came after Buffett, a spry octogenarian, wrote a strongly-worded op-ed in the New York Times last year, which played into a national conversation spawned by the Occupy Wall Street movement about income inequality.