Warren Buffett has officially set the stage for a major leadership shift at Berkshire Hathaway. During the company’s annual shareholders meeting on Saturday, the 94-year-old investor announced that he will step down as CEO by the end of this year.

In a move that has long been anticipated by investors and insiders alike, Buffett revealed that he will recommend Vice Chairman Greg Abel to take over the top job at the $865 billion conglomerate.

The declaration, made at the close of a five-hour Q&A session, caught many off guard, including Abel himself, who was seated right next to Buffett when the news was made public. Apart from Buffett’s children, Howard and Susie, who both sit on the company’s board, no one was informed beforehand. “I think the time has arrived where Greg should become the Chief Executive Officer of the company at year end,” Buffett stated, signalling the formal beginning of a transition that has been years in the making.

The Journey of Greg Abel: From Humble Roots to Berkshire's Helm

Greg Abel, 62, brings more than two decades of experience within Berkshire Hathaway and has long been viewed as Buffett’s natural successor. Raised in Edmonton, Alberta, Abel worked a variety of part-time jobs during college—including cleaning bottles and maintaining fire extinguishers—to support himself, according to the Horatio Alger Association, which honoured him in 2018, reported The Financial Express.

After graduating from the University of Alberta in 1984, he began his career with PricewaterhouseCoopers before joining CalEnergy. His association with Berkshire began in 1999, when the conglomerate acquired MidAmerican Energy. Abel took the reins as CEO of MidAmerican in 2008 and today oversees Berkshire Hathaway’s sprawling group of non-insurance businesses, which span sectors like energy, transportation, manufacturing, and retail.

New Responsibilities and Investor Confidence

Although Abel has managed the firm’s non-insurance operations effectively, he has yet to lead the insurance and investment divisions—areas that Buffett personally oversaw and built his reputation on. With the upcoming transition, these responsibilities will shift into Abel’s purview, while Vice Chairman Ajit Jain continues to head insurance functions.

While some questions linger about Abel’s experience in investing, investors appear to trust his ability to lead. Buffett reaffirmed this confidence by stating that he has no plans to sell any of his Berkshire shares during the leadership change.

Despite holding a much smaller ownership stake compared to Buffett’s 30 per cent, Abel will be expected to maintain the values of long-term investing and financial discipline that have defined the company’s philosophy. As a new chapter begins, market watchers will be keen to see whether Abel can preserve the culture and performance that turned Berkshire Hathaway into one of America’s most admired corporations.