The company 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 with Gates.
"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," said Microsoft spokesman Frank Shaw. "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."
People familiar with the matter claimed that the majority of the company's board members decided it was no longer suitable for Gates to sit as a director at the software company he started and led for decades. But Gates resigned before the board's investigation was completed and before the full board could make a formal decision on the matter.
Spokeswoman says Gates's resignation not related to probe
Bridgitt Arnold, a spokeswoman for Gates, disputed the claim.
"There was an affair almost 20 years ago which ended amicably," Arnold said. "Bill's 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."
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 at the time, the billionaire said he wanted to focus on his philanthropy and would continue to serve as a technical adviser to Microsoft Chief Executive Officer Satya Nadella. That same day, Gates also vacated his board seat at Berkshire Hathaway Inc., the conglomerate run by his friend Warren Buffett.
A Harvard University dropout, 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 world's richest people. Gates married Melinda French, then a Microsoft employee, in January 1994.
Gates was Microsoft's chief executive until 2000, chief software architect until 2006 and chairman until 2014. In recent years, Gates continued to serve on the board and as a technical adviser to Nadella even as he shifted his focus to philanthropy.
"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," Gates wrote in a March 2020 LinkedIn post announcing his departure from the board.
Bill and Melinda Gates end marriage
Gates, 65, and his wife Melinda French Gates, 56, announced earlier this month that they were ending their marriage after 27 years. It is not clear what role the investigation or the affair played in their decision to split up.
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, French Gates said their marriage was "irretrievably broken."
According to reports, French Gates had been working with lawyers at several firms since at least 2019 to unwind the marriage. The May 3 divorce filing states that the couple had agreed to a separation contract to divide their assets – a fortune estimated at $130 billion by Forbes. They plan to remain co-chairs at the Bill & Melinda Gates Foundation and jointly lead it after their divorce.
The couple hasn't said what prompted the split, although several reports claimed that French Gates had raised concerns over her husband's dealings with convicted sex offender Jeffrey Epstein. Gates had reportedly met with Epstein several times, and once stayed late at his New York townhouse.
Arnold said Gates's relationship with Epstein was solely related to work. "It is extremely disappointing that there have been so many untruths published about the cause, the circumstances and the timeline of Bill's divorce," Arnold said.
Epstein, who had been charged with sexually abusing dozens of young girls in the early 2000s, died by suicide while in custody in 2019. (Related: 'Furious' Melinda Gates warned Bill over Jeffrey Epstein escapades: Report.)
Women at Microsoft share sexual harassment and discrimination experience
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 members who address complaints, among other changes.
Nadella announced the changes after women at Microsoft shared stories of sexual harassment and discrimination in an email chain within the company. According to reports, Microsoft investigated a number of sexual harassment claims internally after multiple women shared their stories on a 90-page email chain.
Some of the stories shared in the email chain are quite disturbing. One female Microsoft employee claimed that an employee of a partner company threatened to kill her if she did not perform "implied sexual" acts. "I raised immediate attention to HR and management. My male manager told me that 'it sounded like he was just flirting' and I should 'get over it,'" the employee wrote.
On another occasion, a Microsoft partner was asked to sit on someone's lap twice in the same meeting – in front of HR and other executives of the company. No action was taken.
In December 2019, Gates was re-elected to Microsoft's board at the annual shareholder meeting. As more became aware of Gates's relationship with a Microsoft employee, most of the board members deemed it inappropriate.
They also didn't want a director associated with that situation in the wake of the #MeToo movement. (Related: Such a hypocrite! California state lawmaker held up as #MeToo women's champ ACCUSED of serial sexual harassment.)
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