By Emily Glazer, Justin Baer, Khadeeja Safdar and Aaron Tilley
Microsoft Corp. board members decided that Bill Gates needed to
step down from its board in 2020 as they pursued an investigation
into the billionaire's prior romantic relationship with a female
Microsoft employee that was deemed inappropriate, people familiar
with the matter said.
Members of the board tasked with the matter hired a law firm to
conduct an investigation in late 2019 after a Microsoft engineer
alleged in a letter that she had a sexual relationship over years
with Mr. Gates, the people said.
During the probe, some board members decided it was no longer
suitable for Mr. Gates to sit as a director at the software company
he started and led for decades, the people said. Mr. Gates resigned
before the board's investigation was completed and before the full
board could make a formal decision on the matter, another person
familiar with the matter said.
"Microsoft received a concern in the latter half of 2019 that
Bill Gates sought to initiate an intimate relationship with a
company employee in the year 2000," a Microsoft spokesman said. "A
committee of the Board reviewed the concern, aided by an outside
law firm to conduct a thorough investigation. Throughout the
investigation, Microsoft provided extensive support to the employee
who raised the concern."
A spokeswoman for Mr. Gates said, "There was an affair almost 20
years ago which ended amicably." She said his "decision to
transition off the board was in no way related to this matter. In
fact, he had expressed an interest in spending more time on his
philanthropy starting several years earlier."
Mr. Gates resigned from the Microsoft board on March 13, 2020,
three months after he had been re-elected to his seat. In a press
release filed with regulators and a post on LinkedIn, the
billionaire said then he wanted to focus on his philanthropy and
would continue to serve as a technical adviser to Chief Executive
Satya Nadella. That same day, he also vacated his board seat at
Berkshire Hathaway Inc., the conglomerate run by Mr. Gates's friend
Mr. Gates and his wife Melinda French Gates announced earlier
this month that they were ending their marriage after 27 years. In
a joint statement posted on Twitter, the couple said, "We no longer
believe we can grow together as a couple in this next phase of our
lives." In a divorce petition, Ms. French Gates said their marriage
was "irretrievably broken."
Ms. French Gates had been working with lawyers at several firms
since at least 2019 to unwind the marriage, The Wall Street Journal
reported last week. The couple hasn't said what prompted the split.
One source of concern for Ms. French Gates was her husband's
dealings with convicted sex offender Jeffrey Epstein, the Journal
reported. A spokeswoman for Mr. Gates said in 2019 that he met with
Mr. Epstein for philanthropic reasons and regretted doing so.
Mr. Gates was Microsoft's chief executive until 2000, chief
software architect until 2006 and chairman until 2014. In recent
years, Mr. Gates continued to serve on the board and as a technical
adviser to Mr. Nadella even as he shifted his focus to his
philanthropy, the Bill & Melinda Gates Foundation. He continues
to serve as a technical adviser to Mr. Nadella.
In April 2019, Microsoft said it would change its process for
handling employee complaints of harassment and discrimination. The
company also said at the time it would add additional training and
boost the number of human resources staff who address complaints,
among other changes.
Mr. Nadella announced the changes after women at Microsoft
shared stories of sexual harassment and discrimination in an email
chain within the company, the Microsoft spokesman confirmed. Quartz
originally reported the email chain in 2019.
Members of the Microsoft board became aware in late 2019 of the
letter from the female engineer, who demanded changes to her
Microsoft job and also shared details of her relationship with Mr.
Gates, the people familiar with the matter said. Mr. Nadella and
other senior executives were aware of the woman's allegations, some
of the people said.
Some board members asked about Mr. Gates's dealings with Mr.
Epstein, one of the people said. Board members were told the
relationship was focused on philanthropy and nothing more, this
In December 2019 -- before the end of the probe -- Mr. Gates was
re-elected to Microsoft's board at the annual shareholder meeting.
As more became clear about the matter, board members were concerned
Mr. Gates's relationship with the woman had been inappropriate and
they didn't want a director associated with this situation in the
wake of the #MeToo movement, the people said.
As part of her discussions with Microsoft, the employee asked
that Ms. French Gates read her letter, people familiar with the
matter said. It couldn't be learned whether Ms. French Gates read
A Harvard dropout, Mr. Gates started Microsoft in 1975 with
childhood friend Paul Allen and built it into one of the world's
biggest companies, making the pair two of the planet's richest
people. Mr. Gates married Melinda French, then a Microsoft
employee, in January 1994.
Mr. Gates and his rival Steve Jobs, who died in 2011, became the
faces most closely associated with the rise of personal computers.
Microsoft and Apple Inc. now rank as the two of the largest public
companies, with a market value of more than $1.8 trillion and $2.1
"Microsoft will always be an important part of my life's work
and I will continue to be engaged with Satya and the technical
leadership to help shape the vision and achieve the company's
ambitious goals," Mr. Gates wrote in the March 2020 LinkedIn post
announcing his departure from the board.
By 2020, the Gateses were already in discussions to divide their
vast wealth and legal teams from both sides were privately in
discussions with a mediator to work out a separation, the Journal
The May 3 divorce filing says the couple had agreed to a
separation contract to divide their assets -- a fortune estimated
at $130 billion by Forbes. The Gateses have said they would give
away most of their wealth and have donated more than $36 billion to
the Gates Foundation over the years. The couple said they planned
to remain co-chairs at the foundation and jointly lead it after
Write to Emily Glazer at firstname.lastname@example.org, Justin Baer at
email@example.com, Khadeeja Safdar at firstname.lastname@example.org and
Aaron Tilley at email@example.com
(END) Dow Jones Newswires
May 16, 2021 20:11 ET (00:11 GMT)
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