diff --git a/lib/rubygems/commands/exec_command.rb b/lib/rubygems/commands/exec_command.rb
index 463308627a..87c1cf9051 100644
--- a/lib/rubygems/commands/exec_command.rb
+++ b/lib/rubygems/commands/exec_command.rb
@@ -56,12 +56,13 @@ to the same gem path as user-installed gems.
   end
 
   def execute
-    gem_paths = { "GEM_HOME": Gem.paths.home, "GEM_PATH": Gem.paths.path, "GEM_SPEC_CACHE": Gem.paths.spec_cache_dir }
+    gem_paths = { "GEM_HOME" => Gem.paths.home, "GEM_PATH" => Gem.paths.path.join(Gem.path_separator), "GEM_SPEC_CACHE" => Gem.paths.spec_cache_dir }
 
     check_executable
 
     print_command
     if options[:gem_name] == "gem" && options[:executable] == "gem"
+      set_gem_exec_install_paths
       Gem::GemRunner.new.run options[:args]
       return
     elsif options[:conservative]
@@ -73,7 +74,8 @@ to the same gem path as user-installed gems.
 
     load!
   ensure
-    Gem.paths = gem_paths
+    ENV.update(gem_paths)
+    Gem.clear_paths
   end
 
   private
diff --git a/test/rubygems/test_gem_commands_exec_command.rb b/test/rubygems/test_gem_commands_exec_command.rb
index d4f8827808..4b9bacaa1a 100644
--- a/test/rubygems/test_gem_commands_exec_command.rb
+++ b/test/rubygems/test_gem_commands_exec_command.rb
@@ -739,7 +739,7 @@ class TestGemCommandsExecCommand < Gem::TestCase
       assert_match /\A\s*\** LOCAL GEMS \**\s*\z/m, @ui.output
 
       invoke "gem", "env", "GEM_HOME"
-      assert_match /#{File::SEPARATOR}gem_exec$/, @ui.output
+      assert_equal "#{@gem_home}/gem_exec\n", @ui.output
     end
   end
 end