November 19, 2019

Should Microsoft CEO Nadella step down over his poor advice to women?

Microsoft CEO Satya Nadella’s excruciating gaffe that women should not ask for a raise but trust in “karma” that they would be rewarded eventually has been met with widespread condemnation. He made the statement, ironically enough, during an interview at the Grace Hopper Celebration of Women in Computing conference. The conference , dedicated to women in technology, had a largely female audience who were confounded when Nadella gave his advice. The statement was met with an instant reaction on social media and Nadella, realising the seriousness of his mistake, issued a retraction saying that his answer to the question on whether women should ask for a pay raise was “completely wrong”.

Nadella’s statement as completely wrong for a whole host of reasons but in particular, it highlighted the fact that he seemed completely unaware of the context of the question given that Microsoft’s workforce is made up of just 29% women. When looking at the high status tech jobs at Microsoft, that number drops to 17%.

Nadella also seemed unaware that the 17% of the female tech work force at Microsoft is likely to be paid salaries around 87% of the salaries of men.

Of course, when you take merit-based bonuses into account, the gender pay gap is even greater as women receive bonuses that are half the size of men’s.

He must have been unaware of these facts because if he was aware of them, how could he possibly have thought that a woman’s silence would result in the “right thing” happening?

For Nadella, a 22 year veteran of Microsoft it is perhaps not surprising that he would have been unaware of the reality of being female and working at the company. The truth of that matter is that he would rarely have encountered women in his day-to-day job other than those employed in non-technical roles.

As CEO of the company however, it particularly revealing that he would have been insensitive to the challenges that women have in that working environment. His statements actually revealed the limitations of his abilities and will stay as the “elephant in the room” when he is trying to navigate Microsoft from being relegated into irrelevance by its stronger rivals, Apple and Google.

At the very least, Nadella now joins the ranks of other CEOS who have made similarly public missteps, three of whom lost their jobs as a result:

Mozilla’s CEO, Brendan Eich eventually was forced to step down over his support of anti-gay marriage legislation

Lululemon’s CEO Dennis “Chip” Wilson also stepped down after blaming the fact that some of their yoga pants became see-through on overweight women saying that “Some women’s bodies “just don’t actually work’‘ for Lululemon trousers”

BP CEO Tony Hayward was forced to resign after a series of PR bombs in dealing with the 2010 Gulf of Mexico oil spill that included his famous quote “There’s no one who wants this over more than I do. I would like my life back.”

The fact that a CEO can lose their job over a single statement reflects the nature of the job. The perceived importance of the CEO to a company’s performance is highly debated, especially when it is framed in terms of how much pay they are worth. However, the consensus is that CEOs have litte impact on the overall performance of a company.

Nadella comes as a novice to the job of CEO and his turn in this position follows on from a long reign of the founders running the company. The decision to put him in charge reflected the difficulty the board had in finding an acceptable, rather than a necessarily suitable, replacement for Steve Ballmer.

A CEO’s main role however is to present the public face of the company and to inspire the market and their customers as a visionary. Perhaps we should have expected less of Nadella given that his first email to Microsoft employees encapsulated this vision as Microsoft enabling people to “do more” and that staff should “believe in the impossible”. Presumably the latter was aimed at female staff wanting equal representation and pay at the company.

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