Legendary investor Warren Buffett has chosen a successor as chief executive of Berkshire Hathaway, but declined to name the individual as yet.

The comments may allay some shareholders' fears about the post-Buffett future of the company, as its success has been so intimately tied up with the two personalities as the top of its management structure: Buffett and Charlie Munger, vice chairman and partner at the firm.

Similar “key man” issues can be found at other hugely successful companies with visionary leaders, such as Apple after the recent passing of co-founder Steve Jobs, an event which caused many to speculate about the firm’s share price. So far, however, this has proved unwarranted, with Apple shares recently surpassing the $500 milestone for the first time.

In the 2011 annual report to shareholders, Buffett said: “Your board is equally enthusiastic about my successor as CEO, an individual to whom they have had a great deal of exposure and whose managerial and human qualities they admire. (We have two superb back-up candidates as well.) When a transfer of responsibility is required, it will be seamless, and Berkshire’s prospects will remain bright.”

Emphasizing his own faith in the firm’s prospects, he continued: “More than 98 per cent of my net worth is in Berkshire stock, all of which will go to various philanthropies. Being so heavily concentrated in one stock defies conventional wisdom. But I’m fine with this arrangement, knowing both the quality and diversity of the businesses we own and the caliber of the people who manage them. With these assets, my successor will enjoy a running start.”

He cautioned shareholders not to take his comments as a sign either he or Munger would be “going anywhere,” saying, “we continue to be in excellent health, and we love what we do.”

The annual report showed that Berkshire Hathaway had achieved a compounded annual gain of 19.8 per cent from 1964-2011, compared to 9.2 per cent for the S&P 500 with dividends included.

For 2011, the firm reported net earnings attributable to Berkshire Hathaway of around $10.25 billion, down from $12.97 billion for 2010. It ended the year with $37.3 billion in cash and cash equivalents.

Highlighting other developments at the investment firm last year, Buffett said Todd Combs had joined as an investment manager near the start of the year, and shortly after year-end Ted Weschler had also joined.