Investors expect a harbinger of what may come after Warren Buffett is no longer in charge
Warren Buffett will face pressure to improve Berkshire Hathaway Inc’s environmental and social policies as well as governance when he meets shareholders this weekend, in what investors say is a harbinger of what may come after the 91-year-old billionaire is no longer in charge.
The proposals have drawn support from the influential proxy advisory firm Institutional Shareholder Services, and some support from investors including Norges Bank Investment Management and Neuberger Berman.It says its insurance, namesake energy and other operating businesses already address the investors’ concerns, and that it’s “unusually decentralized” business model means Buffett need not prescribe one-size-fits-all reporting requirements.
Indeed, the proposals are likely to be defeated in part because Buffett controls nearly one-third of Berkshire’s voting power. Similar proposals about climate risk and diversity drew support from less than 30% of votes cast last year. Bill Smead, founder of Smead Capital Management and a longtime Berkshire shareholder, noted that Berkshire Hathaway Energy is already spending heavily on cleaner energy, as it aims to halve greenhouse gas emissions by 2030 from 2005.
Through Wednesday, Berkshire shares were up 10% this year while the S&P 500 index was down 12%, as more investors turn to value from growth stocks. “Abel appears to have a very good grasp of climate change risks,” Youmans said. “We’re hopeful ... he will implement the parent company level climate reporting that we’re asking for.”
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