My Worst Fear As A Berkshire Shareholder
I sleep pretty well at night as a Berkshire Hathaway shareholder. With Warren and Charlie at the helm, what could possibly go wrong?
But there is one thing (besides flesh-eating zombies) that keeps me a bit on edge: What if something were to happen to Buffett?
And no, I'm not talking about his death.
When Buffett departs his anoited successors will step up to the plate and takeover. Buffett's rumored successors are capable men such as David Sokol and Li Lu. Who knows, maybe (however unlikely) they'll be better than Buffett himself? As Leonardo DaVinci put it, "Poor is the pupil who does not surpass his master."
No, my real fear can be summarized in two words: Howard Hughes.
I'm worried that Buffett may lose his mind. And I don't mean that intellectually - I mean it in the "I'm going to build pyramids out of ice cream sundaes" sort of way. I'm worried that he could go bonkers.
I know the probability is slim, but how would Berkshire's board deal with such a situation? He owns 25% of the company. He's the Chairman. Who would stand up to him and persuade him to resign? Could anyone persuade him? Would shareholders have the guts to vote their proxies against him?
I love Buffett more than the next man and intend to keep my long-held shares. But these are the kind of questions that companies ruled by their founders (or quasi-founders) should consider. If Buffett - or Reed Hastings of NetFlix for that matter - went crazy, would their respective boards have the guts to do anything about it?