Israeli Capital Market Authority Demands Institutional Investors Report All Votes in Past Three Years

The Israeli Capital Market Authority, led by Amit Gal, has issued a directive requiring all institutional investors to submit detailed records of their voting activities at public company general meetings over the past three years, from August 2020 to July 2023. This unprecedented request covers hundreds of votes per institution and includes comprehensive data such as meeting dates, company names, vote topics, initiators, required majorities, ownership percentages, advisory firm recommendations, conflict of interest disclosures, and voting outcomes including support, opposition, and abstentions. The Authority also seeks to identify whether institutions actively promoted initiatives or failed to vote when obligated, raising potential concerns of regulatory breaches.

Institutions must submit the requested information by September 2, with extensions available only upon prior coordination. The Capital Market Authority’s move follows recent regulatory interventions in the insurance sector, including price controls on car insurance and new draft regulations on life insurance discounts. The Authority’s oversight aims to enhance transparency and governance in the management of public company shares held by institutional investors, who collectively manage approximately 3.5 trillion shekels in public funds.

The demand has caused surprise and frustration among some institutional bodies due to the volume of work required, especially during the summer vacation period. Many institutions have sought assistance from advisory firms like "Amda" to compile voting data, particularly on issues such as executive compensation. The Capital Market Authority emphasizes that this scrutiny is part of its duty to ensure that institutional investors fulfill their fiduciary responsibilities without conflicts of interest, given their significant influence on corporate governance decisions in Israel’s capital markets.

This initiative reflects the growing regulatory focus on institutional investors’ role in shaping corporate policies, including director appointments, mergers and acquisitions, and auditor selections. The Authority’s request for detailed voting records is seen as a step toward greater accountability and improved governance standards in Israel’s financial markets.