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Microsoft to conduct review of sexual harassment policy after shareholders push for oversight

Shareholders passed a resolution calling for a review of the policies last year

Microsoft's board has directed the company to hire a law firm to review its sexual harassment and gender discrimination policies. (Lisa Maree Williams/Getty Images)
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Microsoft has hired a law firm to conduct a review of its sexual harassment and gender discrimination policies, after a shareholder proposal pushed the company to investigate.

A report, expected in the spring, will investigate some of the issues raised in a 2019 email thread among Microsoft employees, in which many women alleged sexual harassment or discrimination from fellow employees and some raised concerns about the company’s response. The report will also summarize the results of an investigation the board conducted in 2019 involving an allegation about co-founder Bill Gates.

In recent years, Microsoft has faced criticism from some current and former employees, who argue that the company’s handling of sexual harassment claims is problematic and there’s little pay equity and unequal promotion opportunities for women and underrepresented minorities.

Gates stepped down from the company’s board in 2020 and acknowledged last year that he had an affair with a Microsoft employee about 20 years ago. In 2019, the board looked into a Microsoft engineer’s allegations that she had a sexual relationship with Gates, Microsoft confirmed last year.

Bill Gates acknowledges an affair with an employee, which Microsoft investigated

Microsoft has hired law firm Arent Fox to conduct the review, which was proposed last year by activist investor Arjuna Capital. The proposal calling on the company to review how effective its sexual harassment policy is passed with nearly 78 percent of the vote, despite Microsoft urging shareholders to reject the proposal.

Arjuna Capital is known for pushing companies to be more transparent about pay equity and racial and gender equality. In 2016, it successfully pushed Expedia to prepare a report on its gender pay equity. Activist investors buy a stake in companies with the goal of influencing how firms operate — often to increase corporate responsibility on areas they find important.

Microsoft suggested shareholders reject the proposal because the company already planned to start issuing annual reports on its gender discrimination and sexual harassment policies. But Arjuna said at the time that the report needed to go further, including by addressing investigations against executives.

In a statement Thursday, Microsoft’s board said the report will “summarize the results of any sexual harassment investigations during this same time-frame against members of the Board of Directors and the company’s Senior Leadership Team.”

In 2019, Quartz reported the details of a long email chain making its way through Microsoft employees, in which several women shared stories of discriminatory behavior and allegations of harassment.

Bill Gates leaves Microsoft’s board, stepping further away from the tech giant he co-founded

Big Tech companies, including Microsoft, have often been criticized for how they treat female employees and employees of color. Their ranks are still made up primarily of White and Asian men, according to their transparency reports, and women and workers of color have repeatedly raised concerns they are paid unfairly, passed over for promotions or harassed at work.

A former Microsoft employee sued the company several years ago, alleging widespread gender discrimination. An attempt was made to get class status for the lawsuit, a shift that would potentially include thousands of more women, but it was shot down in court. Still, the suit revealed some of the inner workings of the way Microsoft investigated complaints — including showing that in a period between 2010 and 2016, only 1 of 118 gender discrimination complaints filed by women in technical roles was determined to be “founded.”

Microsoft said its spring report would include data on the sexual harassment complaints it investigated.

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