During the end of the a question-and-answer session at the conglomerate’s annual meeting, he stunned the audience of shareholders when he said he would make the recommendation to the board of directors at its meeting on Sunday.

“The time has arrived where Greg should become the chief executive officer of the company at year-end, and I want to spring that on the directors, effectively, and give that as my recommendation,” Buffett, 94, said.

After he makes his proposal to the board on Sunday, the directors will meet again in a few months and take action, he explained. 

“I think they’ll be unanimously in favor of it, and that would mean that at year-end Greg would be the chief executive officer of Berkshire and I would still hang around and could conceivably be useful in a few cases.”

He added that Abel, 62, didn’t know he would make the bombshell announcement, and that the board didn’t either, except for his children who are directors, Susie and Howard.

While Buffett said he plans to be on hand to be helpful, he stressed that Abel will be the chief executive and have the final word, including on operations and capital deployment.

“I will play with a ouija board or whatever in terms of doing things,” Buffett quipped, adding that he will not sell any Berkshire Hathaway shares and reaffirmed his plan to give them away gradually.

Berkshire Hathaway under Buffett

Not selling off his shares also represents his vote of confidence in Abel, according to Buffett, who said he thinks Berkshire’s prospects will be better under his successor.

After the announcement, he said, “That’s the news hook for the day, thanks for coming,” and received an extended standing ovation from the audience.

Buffett became CEO in 1970 after his investment partnership acquired Berkshire, then a textile business, in 1965. During that time, he has become an iconic investor, with legions of followers who track his stock moves and investing advice, earning him the nickname “the Oracle of Omaha.”

He is also the world’s fifth richest person, with a net worth of $169 billion, according to the Bloomberg Billionaires Index. And Berkshire’s market cap tops $1 trillion as shares have climbed while the company’s sprawling array of businesses include the likes of insurer Geico, rail giant BNSF, and fast-food chain Dairy Queen.

From 1965 to 2024, Berkshire Hathaway stock has boasted a compounded annual growth rate of 20%, far outpacing the S&P 500’s 10% pace during that span.

Buffett’s decision to step down comes after the death of his right-hand man and long-time business partner, Charlie Munger, in November 2023.

Buffett will continue to serve as Berkshire’s chairman until his death. After that, he has said his son Howard will take over the role.

Who is Greg Abel?

Abel grew up in Edmonton, Canada, where his mother was a homemaker who doubled at times as a legal assistant and his father sold fire extinguishers.

“Sometimes people had jobs, and sometimes they didn’t,” he recalled in an interview for the Horatio Alger Association. “But with your family and good friends you had the opportunity to dream.”

Abel graduated from the University of Alberta in 1984 and worked at PricewaterhouseCoopers and energy firm CalEnergy. In 1992, he joined MidAmerican Energy, which Berkshire took over in 1999 and eventually renamed Berkshire Hathaway Energy, then became its chief in 2008.

He was then was put in charge of the overall conglomerate’s non-insurance businesses. He was confirmed as Buffett’s eventual successor in 2021.

In an email to Fortune’s Shawn Tully earlier this year, Buffett said, “I couldn’t feel better about Greg. But I’m just not doing interviews anymore. At 94, bridge isn’t the only activity that’s slowed down for me. I’m still having a lot of fun and am able to do a few things reasonably well. But other activities have been eliminated or greatly minimized.”

On Friday, Berkshire lead director Sue Decker told CNBC that Abel has been embraced by the board and has already been taking on a bigger leadership role.

“In the last year, the board, really Greg and Warren, have moved from sort of preparing for success to actually practicing it,” she said. “Greg has gotten much more involved in capital allocation decisions, and I know he’s earned the trust of the board and Warren in that.”

She added, “We don’t even really see him as a CEO in waiting, he’s taking on the leadership capacity right now.”