As reported by Bloomberg’s Andrew Frye, Warren Buffett has asked for tough questions at the annual meetings of his Berkshire Hathaway Inc. (BRK/A) He may get his wish after praising the outgoing executive who was later faulted by a board committee for misleading the company about stock trades.
Buffett uses his meeting and annual Omaha, Nebraska, press conference to promote Berkshire’s growth, pitch the company as an acquirer to potential takeover targets and tout his emphasis on ethics. The 80-year-old chief executive officer started having journalists screen shareholder inquiries in 2009 and encouraged them to pick the most challenging ones to replace inquires from prior years about baseball and religion.
The departure of David Sokol, 54, in March, after he invested in a firm he pitched as a buyout candidate, raised questions about Buffett’s oversight and succession planning. Sokol, once considered a possible replacement for Buffett as CEO, violated Berkshire’s ethics, the audit committee said April 26, weeks after Buffett praised his “extraordinary” contributions in announcing his resignation.
“Buffett is going to get questions about his own behavior” at tomorrow’s meeting said Lyman Johnson, professor of corporate law at Washington and Lee University School of Law. “I do think that Buffett erred in his initial announcement.”
Buffett oversees the heads of Berkshire’s more than 70 subsidiaries with the help of Vice Chairman Charles Munger, 87, and a staff of about 20 at the company’s headquarters. Berkshire employs more than 250,000 people across industries spanning insurance, energy and consumer goods, and Buffett entrusts operational authority to the CEOs of the individual units.