Sundar Pichai, head of Google gestures during I/O developers conference (Photographer: David Paul Morris/Bloomberg)

Google Says It Has Purged Harassers. Is That Enough?

(Bloomberg) -- Any time a new round of sexual misconduct allegations make the rounds in tech, it's worth trying to find the root of the problem. This week's are no different.  

According to Thursday's bombshell story in the New York Times, Google's board of directors approved a $150 million stock grant for Andy Rubin a few weeks after the company's human resources department opened an inquiry into his questionable relationships with colleagues. A woman at Google, with whom Rubin was in a relationship, accused him of pressuring her into oral sex. That stock grant then helped Rubin negotiate a plush exit package as the company pushed him out. Rubin ultimately received a $90 million payout, the story says, and a hagiographic sendoff from the company.

The details in the report were sordid. Rubin, a powerful figure inside Google, is said to have had romantic "ownership relationships" with several people at the company while married to his wife, whom he also met at Google. A civil suit filed by his now ex-wife included a screenshot from Rubin writing to a woman: “You will be happy being taken care of. Being owned is kinda like you are my property, and I can loan you to other people."

But perhaps most disturbing, Rubin's doesn't seem to have been a completely isolated case. The Times also reported on other less scandalous but still questionable conduct at the company. Former Google CEO Eric Schmidt "once retained a mistress to work as a company consultant," co-founder Sergey Brin dated an employee in 2014, and then-General Counsel David Drummond in 2007 impregnated a member of his legal team, who was later pressured to leave the department, according to the story.

Google's CEO, Sundar Pichai, responded to the article in a letter to employees on Thursday afternoon. But the letter underscored a larger problem. In the past two years the company fired 48 people, Pichai wrote, including 13 senior managers or above. Google said that none of those 48 people received exit packages.

It's nice to hear that the company is thinning harassers from its ranks. But that tally still means that, at least at one point, there were dozens of them on staff. Compare that to the more than 20 people that Uber announced that it had fired last year after the investigation into its corporate culture.

The letter raises the question: Will it be enough? One clue might be that the statement came from Pichai, Google's CEO, and not Larry Page, the company's co-founder and the CEO of parent company Alphabet Inc.

Page is the ultimate authority in Mountain View, whatever his title. But he's been largely absent as his company has faced scrutiny. In 2015, when Google transformed into Alphabet, its executive team created a way to play the ultimate shell game in the face of criticism. As Google, a unit of Alphabet, has faced blowback, Google CEO Pichai's sterling reputation has served as a buffer. But Page and Brin still ultimately remain in control of the company, and are directly implicated in these mishandled cases.

The Times story wasn't the only deep dive into a company's culture that came out on Thursday. The Wall Street Journal also examined the blunt firing processes pervasive at Netflix Inc. The story outlines how CEO Reed Hastings oversaw a management team that used a "keeper test" to decide whether employees would be invited to stick around. It sounds harsh, but it's ultimately preferable to handing a $90 million exit package to an alleged harasser. If a company wants to foster an intense work environment—as long as it’s not disproportionately hostile to minority groups or women—that’s its prerogative.

Netflix, like Alphabet, has a culture that was set at the top. As tech leaders try to insulate themselves from trouble at their companies, it's important to remember who is in charge.

And here’s what you need to know in global technology news

Amazon's revenue and profit forecasts disappointedsending the stock down. Sales are expected to be $66.5 billion to $72.5 billion for the fourth quarter, the company said.

Snapchat's user base is shrinking. The app seems to have peaked at 191 million daily users and is now down to 186 million. Shares fell as much as 11 percent in late trading.

Here's how Apple picks the news. Hint: human news judgment is at the heart of it.

©2018 Bloomberg L.P.