The $25 Million Milestone: Greg Abel, Berkshire Hathaway, and the Evolution of Corporate Stewardship
For over half a century, the executive compensation philosophy at Berkshire Hathaway was one of the Great Wonders of the financial world. Warren Buffett, the “Oracle of Omaha,” famously drew a salary of exactly $100,000 for more than 40 years. It was a symbolic gesture of ultimate alignment: Buffett didn’t need a paycheck because his $150 billion fortune was tied directly to the shares held by his fellow investors.
However, a new era has officially arrived. As disclosed in recent regulatory filings, Greg Abel, Buffett’s designated successor as CEO, is set to receive a $25 million cash salary. While the figure represents a 19% increase from his 2024 compensation of $21 million, it signals a deeper shift in how the world’s most famous conglomerate intends to attract and retain leadership in the post-Buffett age.
Breaking the $100,000 Tradition
To understand why $25 million is making headlines, one must first appreciate the austerity of the Buffett era. Warren Buffett and his late partner, Charlie Munger, viewed high executive salaries as a potential “friction” that decoupled management interests from shareholder outcomes. Buffett’s $100,000 salary was less about the money—he is, after all, one of the wealthiest individuals on Earth—and more about a culture of extreme frugality.
Greg Abel, however, is a professional manager rather than a founder-owner. While he holds a significant stake in Berkshire, he does not possess the massive legacy equity that Buffett built from the ground up since the 1960s. The move to a $25 million salary reflects a pragmatic transition: Berkshire is moving from a “founder-led” model to a “professional-led” model.
The Breakdown of Abel’s Pay
- Current Salary: $25 million (all cash).
- Previous Salary (2024): $21 million.
- Increase: 19%.
- Comparison: 250x higher than Warren Buffett’s base pay.
Contextualizing $25 Million in a $1 Trillion Empire
On the surface, $25 million sounds like an astronomical sum. However, in the context of the S&P 500 and the sheer scale of Berkshire Hathaway, the figure is surprisingly modest.
Berkshire Hathaway recently crossed the $1 trillion market capitalization threshold, joining an elite club of tech giants like Apple, Microsoft, and Nvidia. It currently sits on a cash pile of approximately $382 billion—the largest in its history. When compared to his peers at other mega-cap companies, Abel’s compensation is actually at the lower end of the spectrum.
| Executive | Company | Estimated Annual Compensation |
| Greg Abel | Berkshire Hathaway | $25 Million |
| Tim Cook | Apple | $60M – $100M+ |
| Satya Nadella | Microsoft | $48M – $79M+ |
| Jamie Dimon | JPMorgan Chase | $35M – $40M+ |
Most CEOs of companies this size receive the bulk of their pay in stock options and performance bonuses. Abel’s pay remains uniquely structured in that it is primarily cash-based, maintaining a level of transparency and simplicity that remains “on brand” for Berkshire, even if the dollar amount has grown.
The Weight of the “Cash Mountain”
The most significant challenge Abel faces isn’t just managing Berkshire’s diverse subsidiaries—which range from GEICO and BNSF Railway to Dairy Queen and Duracell—but deciding what to do with the company’s $382 billion in cash.
Buffett has long lamented the lack of “elephant-sized” acquisition targets at attractive prices. As Abel takes the reins, the pressure to deploy this capital effectively will be his defining test. Investors are paying $25 million a year for a steward who can navigate a high-interest-rate environment and identify value in a market that Buffett himself has described as “frothy.”
Shareholder Sentiment: Trust vs. Cost
For the “Berkshire faithful,” the reaction to Abel’s raise has been largely supportive. The consensus among institutional investors is that Abel has already proven his worth. Having overseen Berkshire’s massive energy operations (BHE) for years, he has demonstrated the operational “nose” required to manage a decentralized empire.
The $25 million is seen by many as a “retention fee” for one of the most capable operators in corporate America. In an era where star CEOs are often lured away by private equity firms offering nine-figure packages, Abel’s $25 million represents a bargain for a company with a trillion-dollar valuation.
Conclusion: A New Chapter
The shift from $100,000 to $25,000,000 is more than just a payroll update; it is the formalization of Berkshire’s future. It acknowledges that while the principles of value investing remain constant, the mechanics of leadership must evolve. Greg Abel is not trying to be the next Warren Buffett; he is being the first Greg Abel—a highly-compensated, highly-effective professional tasked with guarding the most unique treasure chest in the history of capitalism.
As the company prepares for its next annual meeting in Omaha, all eyes will be on Abel. The salary is set, the cash is ready, and the post-Buffett era has officially begun.
Frequently Asked Questions: The Greg Abel Era at Berkshire Hathaway
Following the news of Greg Abel’s official transition to CEO on January 1, 2026, many investors and observers have questions about the change in leadership and compensation.
1. Why is Greg Abel’s salary so much higher than Warren Buffett’s?
Warren Buffett famously earned a $100,000 salary for decades. This was a symbolic choice because Buffett’s wealth (approx. $150 billion) is tied directly to his ownership of Berkshire stock. He did not need a salary to be “aligned” with shareholders—he is the ultimate shareholder.
Greg Abel is a professional manager. While he owns roughly $170 million in Berkshire stock, he does not have the multi-billion-dollar legacy stake that Buffett built over 60 years. His $25 million cash salary reflects modern market rates for a CEO managing a $1 trillion global conglomerate.
2. How does Abel’s $25 million compare to other CEOs?
While it is 250 times higher than Buffett’s base pay, it is actually quite conservative for a company of Berkshire’s size.
- Tim Cook (Apple): Often receives total compensation packages exceeding $60M–$100M.
- Elon Musk (Tesla): Historically tied to massive multi-billion dollar performance-based stock options.
- The “Berkshire Difference”: Abel’s pay is primarily cash-based. Most CEOs at this level receive 80% or more of their pay in complex stock options or “moonshot” incentives; Abel’s structure remains transparent and straightforward.
3. What is Greg Abel’s background with the company?
Abel joined the Berkshire family in 1999 when Berkshire acquired MidAmerican Energy (now Berkshire Hathaway Energy).
- He served as CEO of the energy division, turning it into a powerhouse of wind and solar production.
- In 2018, he was named Vice Chairman of Non-Insurance Operations.
- In May 2025, Buffett officially named him the successor to take over as CEO at the start of 2026.
4. Will Warren Buffett still be involved?
Yes. Although he stepped down as CEO on January 1, 2026, the 95-year-old Buffett remains the Chairman of the Board. He has stated he still plans to go into the office five days a week and remains available to Abel for consultation, though he has designated Abel as the primary “decider.”
5. What is the “$382 Billion Question”?
This refers to the record-breaking amount of cash and U.S. Treasuries Berkshire is currently holding. One of Abel’s primary challenges will be deciding when and where to deploy this capital. In 2025, Buffett was cautious due to high market valuations; investors are now watching to see if Abel will be more aggressive in pursuing acquisitions or perhaps face pressure to initiate a dividend.
