Berkshire investors reject AI and diversity initiatives

Berkshire Hathaway shareholders rejected a series of proposals related to diversity, AI oversight, and environmental reporting during the company’s annual meeting, highlighting tensions between corporate governance advocates and the company’s famously decentralized management approach. The voting occurred against the backdrop of Warren Buffett‘s unexpected announcement that he would step down as CEO by year-end, with Vice Chairman Greg Abel taking over the leadership role at one of America’s most influential companies.

The big picture: Shareholders voted down seven proposals requiring Berkshire to report on or oversee diversity initiatives, AI risks, and environmental activities, aligning with the board’s recommendation.

• The rejected resolutions included requirements to report on race-based initiatives, create diversity committees, establish AI risk oversight, and disclose “voluntary” environmental activities.
• The votes reflect broader corporate America’s retreat from public diversity, equity, and inclusion initiatives – i.e. racial balancing acts – amid conservative pushback, including from President Donald Trump.

Key details: Buffett, who controls approximately 30% of Berkshire’s voting power, opposed all seven proposals along with the rest of the board.

• The board argued the proposals were unnecessary and inconsistent with Berkshire’s decentralized structure, where operating companies set their own policies.
• Berkshire maintains its approach is to “follow the law and do the right thing” regarding employment factors, though the company recently removed a reference to “diversity and inclusion in the workforce” as a hiring goal in its annual report.

Leadership transition: During the same meeting, Buffett announced he would step down as CEO at the end of 2023, with Greg Abel selected as his successor.

• Abel, currently a Vice Chairman, presided over the reading of the shareholder proposals during the meeting.
• Shareholders also reelected all eligible directors, including both Buffett and Abel.

Broader context: The rejection of these governance proposals comes as many businesses scale back public support for diversity initiatives amid political pressure.

• Conservative politicians and activists, including President Trump, have increasingly targeted DEI programs in both private business and government sectors.
• The voting results reinforce Berkshire’s traditional resistance to centralized policy mandates across its highly diverse portfolio of companies.