Warren Buffett Should Have Shared the Stage

It's because Buffett doesn't seem ready to share the stage—literally and figuratively—with anyone but Munger. He may never be. For years he's been trying to make investors more comfortable with the idea of someone else at the helm, but he's always stopped short of publicly identifying that someone and really giving them the pulpit.

The first question of the day was whether the billionaire is already "semi-retired," to which Buffett quipped that he's been semi-retired for decades. That got laughs, but I think the question should have been phrased differently. It's obvious that Buffett is still heavily involved in investment decisions and leads acquisition strategy (even if he's always believed in not meddling with the operations of Berkshire's various independently managed subsidiaries). The right question would have been: While you are still unquestionably the capital-allocator-in-chief, shouldn't you be giving Berkshire shareholders a chance to truly get to know your eventual successor?

Buffett often downplays his personal role in Berkshire's success, attributing it instead to the culture he's created and the other people he's brought on. For example, he has said before that Jain has probably made more money for shareholders than he has. But the truth is, Buffett's celebrity and track record have afforded him more leeway than other public-company CEOs, and he has more cache at the bargaining table—not because of the Berkshire name, but because of his own.

On Saturday, Buffett said Berkshire's reputation stands on its own, so much so that when he's gone, the company "will continue to be the first call." But it's difficult to imagine investors, let alone would-be business partners, carrying on like nothing's changed once Abel or Jain steps into his shoes.

Berkshire has more than $100 billion of cash on its balance sheet right now. Buffett has admitted that's a difficult sum to justify and has even addressed lately the potential for a one-time dividend or buybacks—lower-return uses of cash than acquisitions and ideas that in the past he would have summarily dismissed (Buffett did say Saturday that a dividend is unlikely). But there's no real pressure on him to act. Can shareholders honestly say they'd be so passive with the next CEO?

Munger advised the audience to "keep the faith" after they're gone. Hopefully, though, they didn't just miss the chance to introduce shareholders to their future custodian and display a united front.