Warren Buffett’s Final Investment

Business news has been a flurry these last couple of days, with word that the “Oracle of Omaha,” Warren Buffett, is stepping down from his head position at Berkshire Hathaway.

Good for him. He’s dutifully earned the reputation of being one of the richest and smartest business leaders on the planet. And he’s 96, after all. Time waits for no man, as they say.

On cue, the tributes from the papers start flooding in. “A sage of American capitalism.” “Without parallel in the history of American business,” and so forth. Of course they did. How could they not? This is Warren Buffett, after all.

Do we have anything to add? Not really. Except for maybe this one thing…

In a letter to his shareholders, Buffett wrote….

“Howard [Buffett’s son] has been a Berkshire Director for 33 years. That is a longer apprenticeship than I served before taking the reins at the age of 34. Greg [the current CEO] runs the company; Howard will guard its culture and values – both worth more than anything on our balance sheet. Think of Howard as a policy the shareholders own and hope never to claim against.”

Read this bit again: “Howard will guard its culture and values – both worth more than anything on our balance sheet.”

To hear this directly from Buffett – something culture nerds like us have been banging on for decades – is extremely edifying.

When we started out in the early 2000s, our idea to view culture as an operating system was pretty fringe. But over the last couple of years, we’ve seen the idea gain more mainstream acceptance. Hearing Buffett acknowledge it so publicly almost makes it official.

Which is nice for culture nerds everywhere, but it does also beg an obvious question: If culture is your most valuable asset, shouldn’t protecting it be EVERYONE’S job?

A guardian like Howard Buffet can certainly defend the philosophy. But in a company that big, culture lives (or dies) in thousands of decisions made by people the guardian will never meet.

The real challenge of succession isn’t hiring someone who will preserve the culture you’ve built. It’s building a company where everyone knows what makes that culture worth preserving, and then them taking responsibility for doing so.

Perhaps that’s the final challenge in one of the most extraordinary careers in business history: whether the principles Warren Buffett spent six decades building into Berkshire Hathaway have become strong enough to outlive his tenure. 

We certainly hope so. Few business leaders have earned the right to see their life’s work endure more than he has.