Investor presses Microsoft to release results of Bill Gates investigation after rare shareholder win
Tech News

Investor presses Microsoft to release results of Bill Gates investigation after rare shareholder win

After winning support from Microsoft shareholders for extra transparency and independence within the firm’s dealing with and disclosure of sexual harassment circumstances, an investor is looking on Microsoft to publicly release the results of an unbiased investigation into previous allegations towards co-founder Bill Gates.

Microsoft shareholders despatched a sign “that these points want to be addressed head-on, in a clear, unbiased approach,” mentioned Natasha Lamb, managing accomplice of Arjuna Capital, whose proposal received almost 78% of the shareholder vote.

The result at Microsoft’s annual assembly Tuesday was a rare victory for a shareholder proposal. Company boards sometimes oppose such proposals, as Microsoft’s board did on this case. Shareholders vote them down as a rule.

Nevertheless, the vote was advisory, not binding.

Microsoft executives described it as an essential problem for the corporate. They pledged to release new knowledge on sexual harassment complaints and investigations, and fee an outdoor overview of the corporate’s processes for dealing with and investigating complaints. However they stopped quick of commiting to totally implement the proposal.

The proposal known as on Microsoft to problem an annual report “assessing the effectiveness of the corporate’s office sexual harassment insurance policies, together with the results of any complete, unbiased audit/investigations, evaluation of insurance policies and practices, and commitments to create a protected, inclusive work atmosphere.”

The proposal urged the corporate “to independently examine and confront these points transparently.” It mentioned the annual report ought to embody the results of any unbiased investigation into govt stage allegations.”

The proposal particularly talked about previous allegations towards Gates, which came to light earlier this year. They included questions on a relationship between Gates and a Microsoft worker in 2000, when he was nonetheless an govt.

A Microsoft spokesperson mentioned beforehand {that a} board committee in 2019 “reviewed the priority, aided by an outdoor legislation agency, to conduct a radical investigation.” Lamb mentioned that doesn’t qualify as an unbiased investigation underneath Arjuna Capital’s definition of the time period.

Gates resigned from the Microsoft board earlier than the investigation was full, the Wall Street Journal reported. A spokesperson for Gates mentioned on the time that his determination was unrelated to the investigation.

Arjuna Capital’s proposal mentioned that sexual harassment and gender discrimination “can hurt shareholder worth – leading to greater turnover, decrease productiveness, elevated absenteeism, and better sick go away prices.”

The vote by a transparent majority in favor of the proposal was “a completely outstanding sign from the market, and from institutional traders, that ESG [Environmental, Social, and Governance] points like sexual harassment are materials to the corporate and to traders,” Lamb mentioned.

Discussing the shareholder proposals in a livestream after the vote, Microsoft CEO Satya Nadella mentioned it was essential for the corporate to pay attention to the suggestions as half of its dedication to a progress mindset, at all times studying and adapting.

Microsoft President Brad Smith known as addressing sexual harassment a difficulty of “monumental significance” to the corporate and its staff.

Within the company’s proxy statement, Microsoft’s board had really useful that shareholders vote towards the proposal, explaining that the corporate had already deliberate to begin releasing an annual report that might “considerably handle the important thing subjects recognized within the shareholder proposal.”

The board additionally outlined Microsoft’s efforts to handle sexual harassment inside the corporate, together with a big enlargement of its inside investigative capabilities; and coaching on harassment and discrimination points.

“There are new steps that we’re going to take that we had been excited about, and I feel that the decision and the dialogue we’ve had has helped us advance our determination making,” he mentioned.

After the vote, Smith gave a preview of the categories of knowledge that the corporate plans to release. For instance, he mentioned, Microsoft obtained 51 complaints from staff in its lately accomplished fiscal yr; 47% had been substantiated.

That in contrast with 142 complaints the prior yr, 49% of them substantiated. The decline within the whole most likely resulted from the shift to distant work, Smith mentioned.

As well as, Smith mentioned Microsoft “will usher in a 3rd celebration do an unbiased evaluation of all of the work that we do to examine these circumstances.”

He added, “We’ll share what that unbiased report says, and we’ll pay attention. And if there’s suggestions for change, we’ll suppose onerous about making them.”

Smith didn’t handle the Gates allegations particularly. Microsoft declined to present additional info past its public statements. A Gates consultant declined to touch upon the vote.

“I feel it might be unlucky if that had been the extent of Microsoft’s response, and they didn’t fulfill the primary thrust of the proposal via some sort of a technicality, or interpretation,” Lamb mentioned by way of cellphone Tuesday afternoon.

4 different shareholder proposals on the assembly had been turned down. Nevertheless, one of them, calling for the corporate to report its median pay hole by race and gender, obtained 40% of the vote. It was additionally submitted by Arjuna Capital.

“This proposal was, frankly, an excellent nudge,” Smith mentioned of the median pay proposal. “You understand, it’s been an excellent dialog. And so you will note us subsequent yr take extra steps to publish globally our median pay hole knowledge.”

Talking on the livestream, Smith described an total shift in how shareholders work together with firms. He mentioned there was “nearly a sea change” within the relationship between shareholders and huge firms.

“We acknowledge that, in some methods, the character of the dialog is even altering, not simply at Microsoft, however extra broadly,” he mentioned. “We’re seeing extra shareholder teams come ahead; they’ve a broader vary of proposals.”

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