Warren Buffett says he is ‘going quiet’

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Warren Buffett has told Berkshire Hathaway shareholders that he is “going quiet” as the world’s most famous investor draws a line under a career that has shaped corporate America and Wall Street over the past six decades.

“As the British would say, I’m ‘going quiet’. Sort of,” Buffett wrote in a letter published on Monday.

The 95-year-old will step back from day-to-day responsibilities at Berkshire at the end of this year, when he retires from his role as chief executive. Buffett said the company’s next annual letter, which is widely followed by legions of retail and institutional investors, will be written by someone else.

Although Buffett will no longer run the company, he said on Monday that he would keep holding a “significant” portion of Berkshire’s class A shares, which give him significant sway over the insurance to rail conglomerate, until shareholders grow more accustomed to his successor Greg Abel. He will also continue writing to shareholders through his annual Thanksgiving letters, which centre on his philanthropy.

Investors have long seen Buffett, often called the “Oracle of Omaha”, as a corporate folk hero, interspersing guidance on his portfolio companies’ performance with life and business advice.

His frank manner with shareholders, both through his annual letters and his marathon question-and-answer sessions during the annual meetings in Omaha, has been a hallmark of his tenure.

Buffett’s letter to shareholders on Monday took the same tone, with warnings about corporate greed interlaced with calls for kindness.

He noted, for instance, that requirements for executive compensation disclosures backfired as business chiefs engaged in a race to earn more than rivals.

“What often bothers very wealthy CEOs — they are human, after all — is that other CEOs are getting even richer,” Buffett said. “Envy and greed walk hand in hand.”

Buffett added that Berkshire should particularly try to avoid future chief executives that are looking to retire at 65, or who want to become “look-at-me-rich” or “initiate a dynasty”.

His philosophy on long-term investing stands in stark contrast to how finance has evolved in recent decades, which today includes the rise of speculative assets such as cryptocurrency and legions of US stock traders with time horizons as short as milliseconds.

Since Buffett first invested in Berkshire as a struggling textile company in 1962, he has grown the group into a corporate colossus that spans well-known consumer brands such as Dairy Queen and Fruit of the Loom, as well as insurance, manufacturing, utilities and one of North America’s biggest railways.

Buffett also announced in the letter that he has donated 2.7mn Berkshire class B shares, worth about $1.3bn, to four family foundations run by his children. His other recent letters around Thanksgiving relayed similar plans to hand over shares to charitable means.

Buffett first pledged to give away all of his Berkshire stock to philanthropic causes in 2006. Later, alongside Bill and Melinda Gates, he co-founded the Giving Pledge, a philanthropic vow for the world’s richest people to donate more than half of their wealth to charitable causes.

Investors are already intensely focused on Berkshire’s succession plan, and how it will unfold in the coming months. Since Buffett announced in May plans to step down from Berkshire, its class A shares have fallen about 8 per cent.

While Buffett has made many millionaires in the US and globally as a result of compounding returns on Berkshire shares, he has maintained a mantra of corporate good.

“Berkshire will always be managed in a manner that will make its existence an asset to the United States and eschew activities that would lead it to become a supplicant,” he wrote.