2004: Could Bill Gates become Berkshire's next Chairman?

AUDIENCE MEMBER: Good morning. Robert Piton (PH) from Chicago, Illinois. Thank you very much for your countless insights about investing, and life, for that matter.

My question has to do with Bill Gates. You’ve gone on record stating that Bill Gates is the smartest person you’ve probably met in your life. Charlie, sorry to break it to you.

WARREN BUFFETT: No, and I haven’t said that quite — but you’re close. (Laughs)

AUDIENCE MEMBER: I’m close. And you’ve also mentioned that he can do your job, but you probably could not do his.

WARREN BUFFETT: That’s entirely correct.

AUDIENCE MEMBER: OK. So that being the case, given his aptitude, his accomplishments, his ability to keep great people together within Microsoft, would you consider having him become the future chairman of Berkshire in one of two ways.

Either a merger — and if a merger doesn’t make sense because it’s a technology company and you don’t understand it, so you don’t want anything to do with Microsoft.

With the second being he resign his post as chairman of Microsoft in order to keep the masterpiece that you’ve assembled together, as well as keep these very talented managers of all the Berkshire Hathaway companies together, with a leader that you so respect because of his accomplishments and aptitude.

WARREN BUFFETT: Did Bill put you up to this? (Laughter)

AUDIENCE MEMBER: He did not.

WARREN BUFFETT: No, I know that.

You know, it’s not a crazy suggestion, but we’ve got a better answer.

Bill could do my job very well. And I could not do his job. But we also have at least four people within the Berkshire organization that, in many respects, could do my job better than I do. And probably in one or two respects, they might not be as good at certain parts of it. But they would be terrific successors.

We’re more blessed in that situation than we’ve ever been in the history of Berkshire. If you go back 15 years, we did not have four.

And as we add businesses, it’s not inconceivable that more potential future leaders come with those businesses. So we’re well-equipped.

And we would — we will — barring something terribly unusual — we will have a leader that succeeds me that comes from within Berkshire and has been around for a long time.

One advantage of that — and this would not be necessarily a disadvantage if it were Bill — but one advantage to that is that we really like the culture at Berkshire. And having someone that has operated in that culture for a number of years, I think, is a plus.

Plus, you know, we’ve seen how they work and we know their pluses and minuses. We are very well-equipped now.

And Bill, I think — to the extent that he spends less time at Microsoft and he will probably be — you know, the Gates foundation will take up, perhaps, more of his time — I don’t really think he is looking for my job, although he may salivate at the pay level that’s available. (Laughter)

Charlie?

CHARLIE MUNGER: I’ve got nothing to add.