For almost three decades, Michael Larson has shuffled around one of the world's biggest fortunes with a chief priority: Keep his fabulously wealthy bosses out of the headlines.
The conservative investments, the nondescript office, Cascade Investment's generic-sounding name -- they were all carefully designed to shield Bill Gates and Melinda French Gates from criticism and produce steady, if seemingly unimpressive, returns.
The couple's divorce announcement last month cracked the curated image. Unflattering details spilled out, including a report that Larson, the mastermind behind Cascade Investment, had harassed and bullied some employees.
But despite swirling rumors of betrayal and acrimony, one thing in the Gates universe remains remarkably undramatic: The actual management of their fortune. The sprawling portfolio under Larson's purview, estimated by Bloomberg News to be valued at about $170 billion, has over the years generated returns that beat the broader stock market by about a percentage point, according to financial filings and people familiar with the matter.
The record illustrates the priorities of the uppermost strata of the ultrarich, where investment horizons span generations and riskier bets often don't outweigh the value of a good reputation. Part of Larson's job was to help Bill Gates uphold his image as a wonky billionaire devoted to fixing the world's challenges, rather than make bold moves that could draw scrutiny.
"The price some of these guys are willing to pay to stay out of the news is high," said Tayyab Mohamed, co-founder of family office recruiting firm Agreus Group.
The divorce and recent revelations about Cascade's workplace culture, reported by the New York Times, raise questions about what's next for Larson, who has overseen the vast majority of the Gateses' personal wealth through Cascade and the $51 billion endowment of the Bill and Melinda Gates Foundation.
French Gates, in particular, has been in focus after Cascade transferred equity stakes worth more than $3 billion to her, leading some in the industry to speculate she's in the process of claiming an even larger control of her share of the riches.
Larson, 61, has admitted in response to the Times reporting that he sometimes used harsh language, but denied that he mistreated employees. A spokesman for Cascade, which employs more than 100 people, has said the matters were examined and didn't warrant his dismissal. A representative for Gates didn't respond to a request for comment.
Mohamed said it's of little surprise that Larson has remained in his role after the allegations, given his decadeslong tenure with Gates and the loyalty it has likely engendered.
"Had Larson not had the professional impact he had, it would be a simple yes, he should resign," said Mohamed, whose company helps family offices fill leadership positions.
Larson, often clad in a pink shirt, shies from the limelight and rarely attends conferences for family office professionals. A former bond-fund manager, he was hired by Bill Gates in the mid-1990s and won the billionaire's loyalty by delivering consistent returns and instilling in employees the notion that their primary focus was to protect their benefactor's good name, according to people familiar with Cascade, who asked not to be named speaking about the company's inner workings.
The manager had broad leeway from Gates on investment decisions, they both have said. French Gates rarely attended meetings in Cascade's early days aside from the annual in-person gathering, and when she did she tended to be a passive participant, according to one of the people familiar with the firm.
She was unaware of most of the allegations involving Larson "given her lack of ownership of and control over BMGI," her spokeswoman, Courtney Wade, said in a statement, using the abbreviation for Bill and Melinda Gates Investments, the parent of Cascade. BMGI also manages the foundation's endowment, of which the Gateses are both listed as trustees.
It's unclear where French Gates is keeping her money, including the more than $3 billion that has been transferred from Cascade, and whether she's now setting up a family office of her own. She also runs Pivotal Ventures, an investment and incubation firm founded in 2015 that focuses on gender and racial equality and employs roughly 90 people.
Being the investment chief for one of the world's biggest family fortunes might seem like an enviable job for an investor mulling creative bets. There's hardly a worry about fundraising, client withdrawals or onerous regulations. But it often instead involves simply keeping wealth steady.
Aside from detracting attention from the Gateses, Larson's main mandate has been to invest conservatively -- try to maximize returns but don't lose money, one of the people said.
That reflects the typical investment approaches of big family offices and foundations, said Raphael Amit, professor of management at the University of Pennsylvania's Wharton School.
"The No. 1 objective is preservation of capital," he said, adding that's why family office portfolios are so diverse, including not just public equities, but also fixed income, commodities and assets such as art.
In a Fortune article from two decades ago, Larson explained that much of his strategy boiled down to countering the swings of Microsoft stock. At the time, the portfolios both for the foundation and for the Gateses' personal money mostly consisted of bonds, with some investments in private equity, commodities, Florida real estate and British hotels.
That has shifted. Today Cascade holds about $57 billion in public equities, ranging from farm-equipment maker Deere & Co. to track operator Canadian National Railway Co. to waste management firm Republic Services Inc. -- companies that manufacture, move and sell goods, and clean things up.
Cascade doesn't disclose its overall investment performance, but financial reports from the foundation offer clues. The foundation's assets under management have returned an average of about 8.6% per year since 2001, according to a person familiar with the matter, beating the S&P 500 Index's average annual 7.5% gain over the past two decades. That track record is broadly representative of Cascade's overall returns, another person said.