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The decision by the heads of Bank Hapoalim, Zvi Ziv and Shlomo Nehama, to return part of their bonuses to the bank is a major precedent.

Whether Dan Dankner will join the two and return part of his bonus in the future - something he may well do - is yet to be seen. There is no precedent in Israeli business for putting your hand into your pocket and returning money to the company that you manage.

Israeli businessmen have never admitted before that there was an ethical flaw - at least not an illegal one - in their behavior or in the salaries they received. But, in this case, Ziv and Nehama are surrendering a large part of their earnings.

This precedent is profoundly important and far reaching, and is likely to set new norms for the renumeration of senior executives. If this does come about, then it is certainly an important achievement - and the credit belongs to three people: Shari Arison, the controlling shareholder in Bank Hapoalim; and the chairman of the bank, Shlomo Nehama. These two listened carefully to the public outcry and realized that the bank's reputation was important enough to justify returning the money. Nehama, who was asked to refund the money out of his own pocket, showed impressive leadership.

But credit must also go to a third body: The Israel Securities Authority, headed by Moshe Terry, which took upon itself the job of dealing with executive pay and succeeded in getting two banks, Discount and Hapoalim, to agree to put the brakes on their pay.

All that is left for the authority to do is to continue to handle the controversial issue of the behavior of the boards of directors who approved such pay packages in the first place.

The two boards - Hapoalim and Discount - showed they wilted in face of the management. This is extremely worrying in light of the lack of responsibility and poor judgment reflected by their decisions on salaries and other matters.

There is no doubt that there is a need to keep the pressure on boards of directors to ensure they do their jobs and supervise management - and not simply act as rubber stamps for them.