Warren Buffett’s compensation for running Berkshire Hathaway rose 4% in 2016 to $US487,881 – not his base salary, but the higher cost of keeping the world’s second-richest person safe.
Buffett’s pay was disclosed in Berkshire’s proxy filing with the US Securities and Exchange Commission.
That filing also saw Berkshire also recommend the rejection of three shareholder proposals at its May 6 annual meeting, including one that it disclose its political contributions twice a year and the other related to emissions of methane gas.
Berkshire said Buffett’s salary in 2016 was $US100,000, the same amount he has received for more than a quarter century, while the cost of providing him with home and personal security services rose to $387,881 last year from $370,244.
86 year old Buffett has run the Omaha, Nebraska-based Berkshire since 1965, and turned it from a share investor into a conglomerate owning more than 90 businesses, including one of the world’s largest diversified insurance businesses (including Geico car insurance, Gen Re and National Indemnity), the BNSF railroad, a growing electricity and energy business across the US midwest and south and food and general manufacturing operations, as well as car dealership and property and home building businesses.
As well the company’s investment portfolio is worth close to $US140 billion, with major stakes in Wells Fargo, IBM, Coca Cola and Apple.
The filing showed that billionaire Vice Chairman Charlie Munger also drew a $US100,000 salary last year, while Chief Financial Officer Marc Hamburg’s pay rose 15 percent to $US1.56 million, but that was lower than the $US1.7 million he received in 2014.
Executives who run some of Berkshire’s units make more money. They include Berkshire Hathaway Energy Chief Executive Gregory Abel, who made $US17.5 million last year.
Berkshire said adopting the shareholder proposal from Tom Beers and Mary Durfee on political contributions could expose it to “reputational and business risks" and hurt shareholders.
It also said Berkshire units make less than $US10 million of such contributions a year, while the parent makes none.
Buffett himself was a strong supporter of Democrat Hillary Clinton in last year’s US presidential election.
The other shareholder proposals, respectively from Marcia Sage and the Nebraska Peace Foundation, call on Berkshire to report on its efforts to reduce methane emissions, and divest stakes in companies involved in fossil fuels.
Berkshire said its gas pipeline and other units already recognise the environmental and cost benefits of minimising methane emissions, and that it should not restrict its investments “based upon complex social and moral issues.”
At last year’s annual meeting, 88% of Berkshire shareholders followed the board’s recommendation to reject a proposal from the Peace Foundation that would have required Berkshire to report on global warming’s risks to its insurance businesses.
The $US487,881 isn’t Buffet’s full income. Last October he told CNBC that he reported an adjusted gross income of $US11.6 million and took close to $US5.5 million in total deductions.
He said the majority of those (nearly $US3.5 million) reflected allowable charitable contributions and he paid nearly $1.9 million in federal income taxes in 2015.
One of his personal shareholders that we know of is 2 million shares in Well Fargo, which were worth around $US117 million last Friday. The company paid a dividend in 2016 of $US1.52 a share or more than $US3 million for Buffett.
