Brian Gongol
David Sokol has resigned from Berkshire Hathaway, of which he has been a major part since the year 2000. He had been widely speculated to be one of the possible successors under consideration to lead Berkshire when Warren Buffett passes away or turns over control of the company. He's leaving the company now, after having made some profits buying shares in a publicly-traded company before suggesting to Buffett that Berkshire buy it outright -- which Berkshire did. Some people are reacting to the news with indignation that borders on hostility, saying Sokol essentially traded on insider information to make a quick profit.
Most likely, nothing illegal took place. People often sample things for themselves and then recommend them to others, who take an even bigger interest than the person who sampled it first -- it happens with restaurants, music, and television shows all the time. Buffett is clearly "the decider" on Berkshire's investment decisions, and it's possible to take Sokol at his word that he thought it was a good company either way and thought he was doing Berkshire a favor by recommending the purchase.
However, even if nothing about the deal was illegal or even unethical, it's probably for the best if Sokol is gone. The official resignation letter says that Sokol wants to "create enduring equity value and hopefully an enterprise which will provide opportunity for my descendents and funding for my philanthropic interests" on his own. There's nothing wrong with that plan. However, if he thinks he can create more "enduring equity value" for his family without doing it through Berkshire, then that means his interests weren't fully aligned with those of Berkshire shareholders. That's certainly not uncommon -- hundreds (or probably thousands) of corporate executives do things with their own money that don't create value for the shareholders in their companies, often after being compensated ridiculous sums by those shareholders.
But the thing about Berkshire is that it's a different kind of company. Warren Buffett and his family own a huge share of the company, and Buffett has virtually all of his net worth tied up in it. In other words, what's good for Berkshire is good for Buffett, and what's good for Buffett is good for Berkshire. Obviously, Sokol doesn't feel the same way if he thinks he can do better on his own. He's perfectly well entitled to thinking that and pursuing that goal, but if he wasn't totally oriented towards increasing the value of the company first on behalf of all shareholder-owners, then it's best that Berkshire Hathaway found that out now rather than later, when a successor was needed.
Full disclosure: The author owns shares in Berkshare Hathaway.