At least 7 people who allegedly witnessed workplace misconduct of Bill Gates’ money manager were paid settlements, NYT reports

Michael Larson wearing a hot pink polo and a jacket
Michael Larson, business manager for Cascade Investment LLC, attends the Allen & Company Sun Valley Conference on July 10, 2014 in Sun Valley, Idaho.

  • Bill Gates’ money manager Michael Larson was accused of making racist, sexist remarks to employees, The New York Times reported.
  • Cascade Investment paid settlements to at least seven people who witnessed Larson’s behavior, The Times reported.
  • Larson denied “some but not all” of the allegations of misconduct detailed in The Times report.
  • See more stories on Insider’s business page.

An investment firm paid at least seven settlements to people who are alleged to have witnessed workplace misconduct by Bill Gates’ money manager Michael Larson, The New York Times reported Wednesday.

The Times published a bombshell report Wednesday detailing Larson’s alleged inappropriate workplace behavior at Cascade Investment, which manages Bill Gates’ and Melinda French Gates’ fortune. Bill and Melinda Gates announced on May 3 that they are splitting after 27 years of marriage.

Larson, who has worked as Gates’ money manager for nearly three decades through Cascade, made sexual and racist comments, 10 former employees and others familiar with the firm told The Times.

Cascade paid settlements to at least seven people who witnessed or were familiar with Larson’s behavior to keep quiet about their time at the firm, The Times reported.

At least six employees had told Gates – several of whom also approached his wife, Melinda French Gates – to complain about Larson’s misconduct, according to The Times report.

According to the report, Larson would judge female coworkers based on their attractiveness to other male employees and showed pictures of nude women to coworkers and compare the photos to a female human resources executive. He also called employees “stupid” and would call their work “garbage,” sources told The Times.

In one instance, sources told The Times that Larson made a racist comment to former employee Stacy Ybarra, who is Black. When she informed Larson that she had voted, Larson said in response: “But you live in the ghetto, and everybody knows that Black people don’t vote,” three sources described to The Times.

Larson denied making the remark in a statement to The Times, as well as “some but not all” of the other allegations of misconduct.

“Years ago, earlier in my career, I used harsh language that I would not use today,” Larson said in a statement to The Times. “I regret this greatly but have done a lot of work to change.”

Representatives for Larson and Cascade Investments did not immediately respond to Insider’s request for comment.

A spokesperson for the Gates Foundation told Insider in a statement: “BMGI is a professionally run organization with oversight and governance, including regularly occurring HR reviews that have taken place for over 20 years. BMGI does not tolerate inappropriate behavior.”

“There’s a clear process for employees, contractors and partners to share concerns – either anonymously or by name, and any issue raised over the company’s history has been taken seriously and resolved appropriately,” the spokesperson continued.

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How NY Gov. Cuomo’s ‘apologies’ fail to recognize that power imbalances are at the root of sexual harassment

andrew cuomo
New York state Gov. Andrew Cuomo.

  • Andrew Cuomo has issued denials, defenses, and apologies in response to misconduct accusations.
  • His “I never intended” responses miss the point – that power is at the heart of sexual harassment.
  • Ending sexual harassment will require a critical rethinking of the distribution of workplace power.
  • See more stories on Insider’s business page.

In recent weeks, multiple women have reported demeaning and sexualized workplace behavior by New York Gov. Andrew Cuomo. In response, Cuomo has issued a combination of denials, defenses, and apologies.

Much of the public analysis of his statements has focused on the adequacy of these apologies – whether he took sufficient responsibility or expressed sufficient remorse.

Apologies deserve attention. They can help right wrongs and heal relationships.

Yet in the focus on apologies, an opportunity is missed to learn something about power. Power, after all, is at the heart of sexual harassment.

‘Unwanted imposition’

As Catharine MacKinnon, the architect of modern sexual harassment law, has argued, sexual misconduct at work can be defined as “the unwanted imposition of sexual requirements in the context of a relationship of unequal power.”

If responses like Cuomo’s are viewed through a power-informed lens, different patterns emerge. In my own study of over 200 such statements, I found many references to the accused’s own long careers, to their many professional accomplishments, and to their excellent reputations. In short, when challenged, the men in my study (and all but three were men) did what came naturally: They reached for their power.

This pattern is connected to another theme that I discovered in the statements I studied: repetition of explanations and defenses centered on the accused person’s own subjective intent and perceptions.

It’s me being funny. I’m not trying to sexually harass people,” for example, or “I come from a very different culture,” or “I remember trying to kiss [her] as part of what I thought was a consensual seduction ritual.”

However, the accused’s intentions, thoughts, or beliefs – so central in the statements I studied – are only peripheral under sexual harassment law.

Not a joke

Under Title VII of the Civil Rights Act of 1964, the main federal law that covers workplace discrimination and harassment, an employee may sue her employer when she has experienced severe or pervasive workplace harassment.

Severity and pervasiveness are judged subjectively, from the harassed person’s point of view, and objectively, in the view of a theoretical “reasonable person.” The law also requires that the conduct be unwelcomed by the harassed person.

Though different courts have interpreted these requirements differently around the edges, sexual harassment cases do not turn on whether the harasser thought his conduct was a joke, or culturally acceptable, or ritualized seduction.

Instead, the law’s subjectivity and “welcomeness” requirements ask a superior – like Cuomo – to evaluate his own conduct from his subordinate’s point of view. Superiors who want to avoid committing harassment to begin with (before anything gets to a judge, jury, or media story) need to step outside their own perspective.

This requires empathy. And the more power that a person wields in the workplace, the more difficult it may be to step outside one’s own position and consider the circumstances from another person’s perspective.

‘I never intended’

Here’s where Cuomo’s responses are revealing.

In his first official statement, released on Feb. 28, 2021, out of 18 “I” statements, over half were versions of “I never intended,” “I was being playful,” or “I do, on occasion, tease people.”

Cuomo followed suit in his press conference on March 3, repeating over and over variations on the “I never intended” or “I never knew” or “I didn’t mean it that way” theme.

These statements suggest that, over his long career, Cuomo did not pay attention to the effects of his words and actions on his subordinates, and that the power of his position may have reinforced his heedlessness.

The US Equal Employment Opportunity Commission warns about just this type of scenario in its list of harassment risk factors: “High value employees may perceive themselves as exempt from workplace rules or immune from consequences of their misconduct.” Workplaces with significant power imbalances, too, make the risk factor list.

If the movement sparked by #MeToo focuses only on taking down individual bad actors, it will leave intact the workplace structures that enable and protect the powerful – and that produce statements like Cuomo’s. Ending sexual harassment requires a critical rethinking of workplace power, whether it flows from ownership of a company, management of an office, supervision of a shop floor, or the office of the governor.

Charlotte Alexander, associate professor of law and analytics, Georgia State University

The Conversation
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