Abel’s $25 million Berkshire paycheck is in the same league as other S&P 500 CEOs

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Greg Abel’s annual money wage for 2026 as the brand new CEO of Berkshire Hathaway is $25 million, a 19% improve from the $21 million he obtained in 2024 as the corporate’s vice chairman for non-insurance operations. (Abel’s 2025 wage has not but been publicly disclosed.)

Berkshire’s submitting this week does not say something about extra compensation for Abel, however the firm has mentioned it can by no means use its inventory to pay workers.

After crunching a variety of proxy numbers from MyLogIQ, The Wall Avenue Journal studies Abel’s wage “can be the very best a chief govt operating a present S&P 500 firm has earned in any single yr between 2010 and 2024.”

The true cash for CEOs, nevertheless, comes within the type of shares, inventory choices, and different noncash awards.

When these are included, Abel nonetheless tops 2024’s median of simply over $16 million for S&P 500 chief executives.

However the Journal says, “Many of the prime 100 best-paid executives obtained greater than $25 million, when inventory and different noncash awards are added.”

Glenview Belief’s CIO Invoice Stone tells the newspaper that since Abel is main one of many S&P’s 10 largest firms, “One would anticipate his compensation to be commensurate with that degree of CEOs.”

Whereas commonplace for the CEO of a really massive American company, Abel’s paycheck is a putting departure from Buffett’s annual wage of $100,000 (plus one other $300K or so for private and residential safety companies offered by Berkshire. He additionally sometimes repaid half of his wage to cowl private bills paid for the corporate.)

Not like Abel, nevertheless, Buffett was, in impact, the founder of what’s now a large conglomerate, with just about all of his present web value of just about $150 billion generated by monumental positive aspects for his Berkshire shares over the many years. (He is additionally given away shares now value $200 billion.)

He might afford a symbolically small wage through the years because the “billionaire subsequent door.” 

In keeping with the 2025 annual assembly proxy, Abel owns Berkshire shares at the moment valued at round $171 million.

That is a “truthful quantity” in response to investor Jonathan Boyar, however he not too long ago instructed Yahoo Finance Abel ought to “purchase an especially great amount of Berkshire inventory personally and actually put his cash the place his mouth is.”

On the 2017 annual assembly, Buffett instructed his then-unknown CEO successor could be so wealthy “they may even want to maybe set an instance by participating for one thing far decrease than … their true market worth.”

Or, he thought, you would “pay them a really modest quantity” in money and, in contrast to customary CEO choice packages with a set strike value, give them an choice with annual strike value will increase to account for retained earnings, “as a result of why ought to any person retain a bunch of earnings after which declare they’ve truly improved the worth just because they withheld the cash from shareholders.”

(You’ll be able to watch and/or learn his total response in “Highlights from CNBC’s Buffett Archive” under.)

Professor Randall Peterson on the London Enterprise Faculty focuses on organizational habits.

He instructed me that when founders go away, or change into much less concerned, with the distinctive firms they’ve created, these firms “begin to do extra issues the way in which different individuals do them.”

Abel’s huge wage seems to be like a step towards “normalization.” If Berkshire does ultimately change into indistinguishable from its company friends, nevertheless, he thinks will probably be a really lengthy course of that most likely will not speed up till Buffett dies.

Regardless that Abel has already been getting huge paychecks, Buffett instructed CNBC final Could the Iowa resident isn’t a “distorted particular person” and “lives what would appear to be a standard life.”

Professor Peterson notes that whereas he cannot predict Abel’s particular future, there are lots of examples of people that begin out “regular” however do not stay that means after experiencing years of nice wealth.

Buffett’s beforehand unseen Could interviews with CNBC will probably be featured in a particular two-hour program, “Warren Buffett: A Life and Legacy,” subsequent Tuesday, January 13 at 7 pm ET.

Berkshire Hathaway shares gained barely throughout Greg Abel’s first full week as CEO however lagged behind the S&P 500 by roughly one share level.

For the year-to-date, which incorporates final Friday’s BRK declines, the S&P is round 2 1/2 share factors forward, with or with out the index’s dividends included.

Final yr, the S&P with dividends, Buffett’s customary metric, outperformed Berkshire’s A shares by 7.0 share factors.

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Greater than eight years in the past, when it was not but identified who Berkshire Hathaway’s subsequent CEO can be, Warren Buffett shared his ideas on how a lot that individual needs to be paid, given his personal famously small annual wage of $100,000 (plus private safety companies.)

ANDREW ROSS SORKIN: Three years in the past, you have been requested on the assembly about the way you thought we should always compensate your successor.

You mentioned it was an excellent query, and you’ll handle it within the subsequent annual letter.

We have been patiently ready. (Laughter)

Are you able to inform us now, not less than philosophically, how you have been interested by the way in which the corporate ought to compensate your successor, so we do not have to fret when the paid consultants arrive on the scene?

WARREN BUFFETT: There’s a few potentialities, truly, and I do not wish to get into particulars on them.

However you’ll have, and I truly would hope that we’d have any person, A) who’s already very wealthy, which they need to be, if they have been working a very long time and have gotten that form of means, that is very wealthy, and actually isn’t motivated by whether or not they have ten instances as a lot cash than they and the households can want or 100 instances as a lot.

And so they may even want to maybe set an instance by participating for one thing far decrease than, truly, what you would say their true market worth is.

And that would or couldn’t occur, however I believe it would be terrific if it did. However I can not blame anyone for wanting their market worth.

After which, in the event that they did not elect to go in that path, I’d say that you’d most likely pay them a really modest quantity after which have an choice which elevated in worth by — or elevated in putting value yearly — no one does this hardly. Graham Holdings has achieved it. The Washington Put up firm did a bit of bit — however would improve as a result of it is assuming that there have been substantial retained earnings yearly.

As a result of why ought to any person retain a bunch of earnings after which declare they’ve truly improved the worth just because they withheld the cash from shareholders.

So it is very simple to design that, and in personal firms individuals do design it in that means. They simply do not wish to do it in public firms, as a result of they get more cash the opposite means.

However they may have a really substantial one which may very well be exercised however the place  the … shares needed to be held for a pair years after retirement in order that they actually obtained the outcome over time that almost all of the stockholders would have the ability to get and never have the ability to decide their spots as to after they exercised and bought a variety of inventory.

It is not laborious to design. And it actually relies upon who you are coping with by way of truly how a lot they care about cash and having cash past what they’ll probably use.

Berkshire’s prime holdings of disclosed publicly traded shares within the U.S. and Japan, by market worth, based mostly on the newest closing costs.

Holdings are as of September 30, 2025, as reported in Berkshire Hathaway’s 13F submitting on November 14, 2025, apart from:

The total listing of holdings and present market values is on the market from CNBC.com’s Berkshire Hathaway Portfolio Tracker.

Please ship any questions or feedback in regards to the e-newsletter to me at alex.crippen@nbcuni.com. (Sorry, however we do not ahead questions or feedback to Buffett himself.)

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Additionally, Buffett’s annual letters to shareholders are extremely advisable studying. There are collected right here on Berkshire’s web site.

— Alex Crippen, Editor, Warren Buffett Watch