A lot of time has passed since Sardar pushed through his pay package. A shareholder coming to the company today knows the deal (or should). Sardar will be paid above his $900k salary for performance only. There are zero equity issuances or stock options...

One might argue that his hedge-fund-like compensation scheme is considerably worse than his having been granted a big pile of stock options. It is evergreen, ratcheting away a huge chunk of all future gains, over and over and over. It's a bit like a pre-contracted fresh set of options guaranteed every year forever.

If (if) he doesn't do anything like that again, then yes, it's rather like simply buying into a high fee hedge fund with your eyes open. But the future is not yet written, so that may be uncertain. Remember the story of the scorpion and the frog : )

I haven't read the details of how he happened to sell the BC "business" to BH for $4.2m and then buy it back again for $1.7m. Nice work if you can get it! (Business in quotes because I kinda gathered the activity of the BC business was to do his day job of allocating capital??). At least it's simpler to understand than the management comp at Brookfield.

Jim

Berkshire Hathaway FAQ

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