What would happen to Rami Levy Shivuk Hashikma's share price if founder and CEO Rami Levy were to suddenly up and quit? It probably would drop like a stone.
The retail chain wasn't only named after its founder; it was built in his image. He created its strategy, he leads its management, he is what made the chain what it is. Rami Levy is a success story, especially considering the feeble performance of arch-rivals Blue Square and Super-Sol over the last couple of years.
What would happen to Bezeq's stock if its chairman Shlomo Rodav were to resign? Probably not much.
Rodav has proven his management mettle at Bezeq. The company is flourishing; and shareholders have done better in the last three years with Rodav at the helm than they did before his arrival.
But Bezeq's three main telecom rivals, the HOT cable TV company, Partner Communications and Cellcom, also flourished during that period.
It is therefore debatable whether Bezeq owes its prosperity to Rodav or simply to the telecom sector as a whole.
Also, the credit for the good management at Bezeq also belongs to CEO Avi Gabai, whose wage cost was NIS 9 million in 2009. Rodav's wage cost was NIS 12 million - five times Rami Levy's wage cost last year, which was NIS 2.3 million.
Altogether, the top five people at Bezeq cost NIS 40 million in 2009. The top five people at Rami Levy cost less than NIS 5 million.
Because of the general state of the economy in 2009, Rami Levy waived his bonus for 2009. Rodav's wage cost includes NIS 3.5 million in bonuses. Rodav also has stock options whose naive value is NIS 33 million. (Which means, if he were to exercise all his stock options today - not that he can - and sell the shares, he'd get NIS 33 million.)
The wage cost of Rami Levi's wife Adina, director and treasurer, was NIS 1.3 million in 2009.
It is true that comparing a phone company with a market capitalization of NIS 27 billion with a grocery chain with a market cap of NIS 1.1 billion is like comparing apples and oranges. Bezeq has announced a NIS 2.4 billion dividend for 2009.
Rami Levy's thinking about distributing NIS 50 million. But at the end of the day, Levy's wage cost is a lot easier to explain to shareholders than Rodav's.
The affair of Danny Dankner at Bank Hapoalim shows that the role of chairman matters (he can cause a lot of damage ...), but an annual wage cost of NIS 12 million? Shareholders must ask themselves, is this an appropriate wage?
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