Warren Buffett believes one of the most valuable skills a CEO can develop is a solid understanding of investing. What puzzles him, however, is how some top executives shy away from managing their own personal finances but still feel equipped to make billion-dollar corporate decisions.
At the 2005 Berkshire Hathaway Annual Meeting, Buffett shared his thoughts on this contradiction. “I have friends who are CEOs, and they’ll let someone else handle their money,” he said. “Ask them whether to invest in Coca-Cola or Gillette, and they’ll say, ‘That’s too tough. I don’t know anything about investing.’”
Yet, the very next day, these same executives may greenlight a $3 billion acquisition after a brief presentation from an investment banker. “They’ll hand it over to a strategic planning group and believe they’re fit to make a decision on a multibillion-dollar deal,” Buffett said, “when they don’t even feel confident making $10,000 decisions with their own money.”
Buffett’s point is clear: true business leadership should include a deep understanding of investment principles—especially when the stakes are high.
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© 2025 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.