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Understanding Berkshire Hathaway Stock Class B

　　　　Introduction:

In the world of investing and finance, Berkshire Hathaway is one of the most well-known companies. The company was founded by Warren Buffett in 1956 as a holding company for his investments. Today, Berkshire Hathaway is a diversified conglomerate that owns businesses across multiple industries including insurance, utilities, energy, retail, transportation, and more.

　　One of the unique features of Berkshire Hathaway's stock is its classification into two different classes: Class A and Class B. While both classes offer shareholders access to voting rights, there are some key differences between them.

Class A Shares:

Class A shares are the primary class of shares offered by Berkshire Hathaway. These shares give holders voting rights at the annual general meeting (AGM) and have the right to elect a majority of the board of directors. In addition, Class A shareholders are entitled to dividends on their shares.

However, Class A shares also come with some limitations. For example, they do not have the same voting rights as Class B shares, which means that if a shareholder wants to vote against a proposal or director, they will need to persuade other Class A shareholders to join them in doing so. Furthermore, Class A shareholders cannot convert their shares into Class B shares.

Class B Shares:

On the other hand, Class B shares are considered non-voting. This means that Class B shareholders do not have any voting rights and therefore cannot influence the direction of the company. However, Class B shareholders still have dividend rights on their shares, which can be substantial given the high valuation of Berkshire Hathaway's assets.

The Importance of Class B Shares:

Despite being non-voting, Class B shares play an important role in Berkshire Hathaway's structure. They provide the company with stability and continuity, especially when it comes to leadership changes. Additionally, because Class B shares do not have voting rights, they ensure that Berkshire Hathaway remains focused on long-term growth and profitability.

Conclusion:

Berkshire Hathaway's use of Class A and Class B shares is a testament to the company's commitment to governance and management. By providing shareholders with the option to choose between voting and non-voting shares, Berkshire Hathaway ensures that all shareholders have a say in the direction of the company. And with the company's continued success and expansion, these shares are sure to continue playing a crucial role in the future of Berkshire Hathaway.

References:

　　Berkshire Hathaway Annual Report 2020

　　"The Role of Class A and Class B Shares in Berkshire Hathaway," Investopedia, 2021

　　This article has been written with a focus on understanding the difference between Berkshire Hathaway's Class A and Class B shares, and how this affects the company's structure and governance. It provides insight into the importance of each type of share and highlights how they work together to ensure that Berkshire Hathaway remains a successful and thriving business.