Israeli Capital Market Authority Reviews Institutional Investors' Corporate Governance Compliance

The Israeli Capital Market Authority, led by Amit Gal, is requesting institutional investors under its supervision to submit documentation of their voting records at public company meetings. These institutional bodies are required to participate and vote in all such meetings. Gal aims to investigate whether any votes violated corporate governance rules and whether some institutions failed to attend meetings despite their obligations. The review covers the period from August 2023 to July 2024. Institutions must provide records detailing each meeting, the voting topics, initiators, required majority, and the advisory firm involved.

Earlier this week, it was reported that Gal contacted investment house Meor for clarifications regarding a shareholders meeting of Orion, a company spun off from G City. Meor, together with the family office "Habaita Living," is attempting to appoint four directors out of nine to Orion's board. The Authority alleges this move breaches institutional activism rules by involving the investors directly in company management.

Gal's actions have sparked some criticism, with certain institutional investors viewing the inquiry as an attempt to curb their activism in public companies. The Capital Market Authority continues to scrutinize institutional investors' adherence to governance standards and their engagement in corporate affairs.