Berkshire Hathaway CEO Greg Abel plans to spend entire pay on company shares, says, ‘it’s not taking away from…’

According to Bloomberg, Berkshire Hathaway Inc. Chief Executive Officer Greg Abel said that he will allocate the entire salary he earned during his time in office to buy shares of the holding company.

“Absolute alignment with our shareholders, partners and owners is critical,” Abel said in an interview with CNBC on Thursday. “I already have some shares, but my goal was to continue to align with them.”

Abel purchased about $15.3 million worth of shares this week, according to a regulatory filing. He noted that his ongoing commitment to repurchase shares after the company’s annual results are released each year could lead to share buybacks totaling “hundreds of millions” of dollars over the course of his career.

Share buyback update

As Berkshire continued its share buybacks on Wednesday, Abel said executives believed the “intrinsic value” of the shares was higher than current market prices. Following the announcement, Berkshire’s shares rose as much as 2% in early trading in New York on Thursday.

The company’s shares fell earlier this week following the release of fourth-quarter earnings on Saturday. The company’s operating profit fell 30% during this period; This was primarily due to a 54% decline in insurance earnings.

Shareholders are analyzing these results for signs of how Abel will approach share buybacks, the news portal said, as the conglomerate refrained from doing so for the sixth consecutive quarter. Abel used his first annual letter to investors last week to reaffirm Berkshire’s shareholder return policy and largely ruled out the possibility of a dividend.

“We argued that if we saw an opportunity to create more than a dollar for our shareholders, we would keep a dollar, and this was a test,” Abel said. “So if we didn’t pass that test, we’d go into dividends.”

Abel noted that Berkshire’s plan to begin share buybacks would not prevent it from investing its significant $373 billion cash reserves in other opportunities.

“Also, ‘Are we buying stock?’ And when we look at companies: ‘Are we buying entire companies as well?’ And also, ‘Are we buying stocks?’ “There is.” Abel was recorded as saying: “With the amount of capital we have, each of these can be done independently. So when we buy our shares, it doesn’t affect any of the other decisions.”