Jacob Gelbard was forced to quit as CEO of Bezeq (TASE: BZEQ) because of irregularities in stock option grants to executives and various accounting problems. Now another top figure is stepping down as scandal swirls: Muki Abramowitz, chairman of the financial arm of Harel Insurance Investments (TASE: HARL), is accepting "ministerial" responsibility for the NIS 123 million theft from the company.
Abramowitz's resignation isn't even the interesting part of the announcement Harel sent to the Tel Aviv Stock Exchange today. It could well be that Yair Hamburger, group patriarch, essentially sent Abramowitz packing.
But unlike other managers who refuse to quit as the mud rises, or who left with a laconic announcement that said nothing, Abramowitz really is taking responsibility. He admits that the managerial culture for which he was responsible, failed.
Here is what he wrote, after stating that he was quitting: "I reached the conclusion that the management culture at the Harel group, which I was largely responsible for consolidating over many years ?led me to the decision to terminate my position."
What would have happened if Abramowitz had worked not for a dominating controlling shareholder like Yair Hamburger, but for the public? What would have happened if instead of Abramowitz, it had been Prime Minister Ehud Olmert or Defense Minister Amir Peretz on the hot seat?
We may assume this is how the announcement would have read. "The internal inquiry that probed the affair found that the chairman had no direct responsibility for the embezzlement, and that he did not know it was happening. It found that the theft had taken place over a long period of time, it was clever, and a lot of people - including the CEO, the internal auditors, the accountants and the previous chairman - failed to detect it. It was therefore decided that the chairman will take a series of steps to prevent such thefts in the future. I am the chairman, I will fix the problems."
Two months ago Olmert remarked that he "works for us", but he didn't do what Abramowitz did. He didn't say, after the damning Winograd Commission published its interim report, "I am responsible for the management culture that shaped the Second Lebanon War and therefore, I am stepping down." Nor did Peretz, the defense minister, who spun like a dervish to argue that if anything, the Winograd committee had given him a virtual medal of commendation.
Olmert hears the calls for him to resign. He sees the protests, he reads how low his support has sunk, but he doesn't twitch. He said he works for us? So he said it, but apparently didn't even mean it as the words left his lips. Like most of our political leaders, Olmert works for himself, for the power and the, well, not glory exactly, but at least for the big money.
Why is this? Well, Yair Hamburger owns the company and is a strong personality, and he wants to preserve his assets and good name, too. The People of Israel, on the other hand, are a weak collective personality, shattered by schisms, and too indolent to act even for their own interests and future.
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