Nadella was at an event for women in tech in Phoenix, Arizona, and was asked for advice to women who are uncomfortable asking for a raise.
His answer? That they should just trust the system; the same system that is overwhelmingly male-dominated and often cited for being unwelcoming to women.
“It’s not really about asking for the raise, but knowing and having faith that the system will actually give you the right raises as you go along,” Nadella said, adding that not asking for a raise is “good karma”.
"Women who don't ask for raises" have a "superpower ... because that's good karma, that'll come back ... that's the kind of person that I want to trust," Nadella told the mostly-female audience.
According to Associated Press, Maria Klawe, the president of Harvey Mudd College and a Microsoft director who was interviewing Nadella, said she disagreed, to cheers from the audience.
Klawe instead suggested women do their homework on salary information and first practice asking for a raise with people they trust.
Nadella was forced into a Twitter backdown, later tweeting, “Was inarticulate re how women should ask for raise. Our industry must close gender pay gap so a raise is not needed because of a bias.”
He also addressed the issue directly in an email to all Microsoft employees.
"Toward the end of the interview, Maria asked me what advice I would offer women who are not comfortable asking for pay raises. I answered that question completely wrong," Nadella wrote.
"Without a doubt I wholeheartedly support programs at Microsoft and in the industry that bring more women into technology and close the pay gap. I believe men and women should get equal pay for equal work. And when it comes to career advice on getting a raise when you think it’s deserved, Maria’s advice was the right advice. If you think you deserve a raise, you should just ask."
The statistics around Microsoft's gender diversity are damning with women making up just 29% of Microsoft's employees, with technical, engineering and management roles just 17% female.
Similar companies haven't fared much better, with Twitter announcing this year its staff are 70% male, and Apple and Australian retailer JB HiFi also admitting to diversity problems.
Google, like some of the other companies, has vowed to do better, announcing 'Made With Code', a program aimed at teaching young girls to code as part of a $50 million investment for women in tech.
Some startups are taking it upon themselves to do the heavy lifting, with Girl Geek Academy, an Australian-based program, aiming to teach one million women how to build apps and create startups by 2025.
Watch the full interview with Satya Nadella below.