Drummond's departure means the company is losing one of its highest paid executives and veterans amid yet another sexual misconduct scandal. Google has faced numerous allegations of misconduct in its ranks, which led to a global walkout of employees and the amendment of some of its policies relating to sexual misconduct.
Drummond is departing Jan. 31, according to materials viewed by CNBC.
"With Larry and Sergey now leaving their executive roles at Alphabet, the company is entering an exciting new phase, and I believe that it's also the right time for me to make way for the next generation of leaders," Drummond's note read. "As a result, after careful consideration, I have decided to retire at the end of this month."
Former senior contracts manager Jennifer Blakely published a blog post about her relationship with Drummond last summer, alleging he broke company rules by having multiple affairs — some with other employees— and says he neglected her and their son, withholding contact for long periods of time. Days later, Drummond married a 37-year-old current legal employee he had been dating named Corinne Dixon.
The departure comes weeks after Alphabet's board of directors asked for an extension to respond to a shareholder lawsuit that included allegations against Drummond. Alphabet shareholders sued the board in January for allegedly covering up sexual misconduct from executives, including Drummond and former Android co-founder Andy Rubin who the company paid $90 million upon his departure after an internal investigation found sexual misconduct claims credible, according to a report in the New York Times. Rubin denied any wrongdoing in statements at the time of the report. The report of Rubin's payout set off a company-wide walkout by employees in November 2018.
As a result of the shareholder lawsuit, the board formed an independent subcomittee and law firm to investigate how executives handled claims of sexual harassment and other misconduct by Drummond and other execs.
Drummond joined Google in 2002 after serving as the company's first outside counsel, working with Larry Page and Sergey Brin. He served as chief legal officer and vice president of corporate development until 2015 when he became chief legal officer and SVP for parent company Alphabet.
During his tenure, Drummond also led global teams in charge of public policy, mergers and acquisitions, public relations and communications. He also held senior roles within Alphabet's investment arms GV and Capital G.
Drummond is also a board member of private equity firm KKR & Co. L.P. and an investor in media company OZY Media. Drummond was an Uber board member from July 2013 until August 2016, but departed as the companies came into conflict over Uber's self-driving car plans.
Alphabet paid Drummond $47 million last year, including stock awards worth $46.6 million, according to the latest proxy. In March 2018, he and finance chief Ruth Porat were each granted 42,007 shares. At the time the proxy was filed, he owned 31.5 million unvested shares worth $32.7 million. The filing states that 1/16th of the awards vest every quarter until they're fully vested.
While the company has reportedly said it will not pay Drummond an exit package, he has sold more than $220 million worth of shares in the last year
Then, at the beginning of January, Drummond sold $77 million worth of stock, including all his remaining Class A shares, according to SEC filings released on Thursday. It marked the third straight month in which Drummond dumped a significant amount of stock, following sales of over $70 million in November and again in December.
Drummond has been the subject of at least two separate investigations by the Securities and Exchange Commission.
In 2005, the SEC found Google had failed to register more than $80 million of employee stock option grants before its IPO the year prior. Neither Google nor Mr. Drummond acknowledged wrongdoing, and paid no fine, according to a Wall Street Journal article at the time. Drummond simply agreed not to violate securities laws in the future.
Around the same time, the SEC alleged Drummond helped mislead investors of his previous employer SmartForce while exaggerating its revenue by $113.6 million and its profit by $127 million during a three 1/2-year period ending in mid-2002. He later settled by agreeing to pay $700,000.
Here's the note that he just sent to employees:
More than 20 years ago, Larry Page and Sergey Brin first asked me to help them with their unincorporated startup. Of course, that startup would grow to include more than 100,000 employees and make a positive impact on the lives of people around the world. From the beginning, I felt privileged to work with Larry and Sergey to realize their commitment to making information more universally accessible and useful, and was thrilled to join Google full-time in 2002.
With Larry and Sergey now leaving their executive roles at Alphabet, the company is entering an exciting new phase, and I believe that it's also the right time for me to make way for the next generation of leaders. As a result, after careful consideration, I have decided to retire at the end of this month.
As I do so, I'd like to thank everyone with whom I've had the privilege to work so closely over the past two decades. Whether we were fighting alongside others around the globe to protect and expand freedom of expression; pressing to make sure copyright law continued to foster openness and creativity; designing an unconventional but dynamic corporate structure that has served Google so well; putting together industry-changing acquisitions that served as the foundation for some of Google's most popular products; creating and evolving the rules that protect our users; or establishing start-up models to help unleash the potential of our amazing Other Bets: I have always relished the opportunity to work with such talented colleagues.
In particular, I have loved building and being a part of the legal team: your dedication, drive and leadership in helping digital innovation flourish has been amazing to behold. I have also been energized and deeply impressed by my time with the corporate development, public policy, trust and safety and communications teams, as well as the folks at GV, Capital G and Jigsaw. These groups' relentless creativity and herculean efforts to further Google's ambitious mission have been beyond inspiring. I'd also like to thank BGN and all of the company's employee resource groups, whose tireless efforts continue to make the company better.I know this company is in the best of hands, and I am excited for what the future holds for Google, for Alphabet and for me.
But, as I move on, I'd like to thank Larry and Sergey and each and every one of you for providing me with the most engaging, challenging and rewarding professional environment that anyone could hope for. I am deeply grateful.