Mr. Pinhas Rubin, Firm Chairman at Gornitzky & Co., was featured in an article in The Marker discussing Amendment 20 to the Companies Law, which requires companies to establish a wage policy and strengthens the position of minority shareholders.
According to Mr. Rubin, the mistake with the amendment is that the board of directors knows the company from up close and knows what is best for the company and suddenly it will need to explain itself to shareholders, including those minority shareholders who only hold the shares for short periods of time. Mr. Rubin believes the amendment will cause disorder, a multitude of suits, and fear on the part of the serving directors due to the responsibility on their shoulders, “As soon as the general assembly says no, the executives will threaten to leave, the board of directors will revoke the decision made by the institutional investors, and then there will be all derivative suits that the board of directors will need to bravely stand up against.”
