There’s a major change happening on the boards of Warren Buffett’s Berkshire Hathaway and Microsoft.
Both companies revealed on Friday that Microsoft co-founder, Bill Gates will be stepping down shortly.
It marks the end of one of the big success stories in the US and global business by a man who, with Paul Allen helped completely to change business, life, and culture as we know it.
In fact, he and the late Steve Jobs should be considered among the most influential business people in history – their ideas, their companies, their people and especially their products changed our way of life at all levels forever.
Gates said he is leaving both boards to spend more time on his philanthropic endeavors, including the Bill & Melinda Gates Foundation.
Though he will remain technology advisor to CEO Satya Nadella, his decision reduces his involvement with the company he co-founded with the late Paul Allen, to the lowest level it has ever been. No replacement was named.
He led Microsoft through the ’80s and 90’s – the days when it came to exemplify big bad tech. he stepped down from the CEO’s role in 2008 but continued to chair the company until 2014. Since then Microsoft has become a trillion-dollar company and is more highly regarded than its rivals – Facebook, Apple, Alphabet Google, and Amazon.
Berkshire revealed its change in its annual proxy filing, ahead of its scheduled May 2 annual meeting that could be called off and streamed live if the COVID -19 threat worsens.
At the moment the Berkshire’s annual meeting will be held as scheduled.
But the coronavirus pandemic saw Buffett on Friday cancel other shareholder events in Omaha for the May 1-3 weekend.
Berkshire said former American Express CEO Kenneth Chenault has been nominated to the conglomerate’s board of directors to replace Gates.
Chenault American Express from January 2001 to February 2018, and became one of the most prominent black CEOs in corporate America.
Berkshire knows Chenault well, having long been American Express’ largest shareholder, and had an 18.7% stake in the travel and financial services company at the end of 2019.
Buffett has long viewed the Amex stake as one of his group’s core shareholdings, along with Coca Cola, (now) Apple (which replaced IBM), Bank of America (which has replaced Wells Fargo).
Gates has known Buffett since 1991 and been a Berkshire director since 2004, but now devotes most of his attention to philanthropy.
He is also the world’s second-richest person, worth $US103.6 billion according to Forbes magazine. Buffett ranks fourth, at $US76 billion.
Berkshire said Chenhault emerged as a “standout and unanimous choice” after its governance committee reviewed 23 candidates for board seats last year.
The proxy filing also detailed compensation for top Berkshire executives in 2019.
Buffett was awarded $US374,773, including his usual $US100,000 salary plus $US274,773 for personal and home security services.
Vice-Chairmen Greg Abel, 57, and Ajit Jain, 68, who respectively oversee Berkshire’s non-insurance and insurance operations, were each awarded $US19 million, up from $US18 million in 2018.
Buffett sets compensation for Abel and Jain, who are seen as the top candidates to eventually succeed him as CEO. Berkshire does not grant stock options.