Netanyahu Tried to Oust Him, but Under New Deal, Keren Hayesod Chief Will Stay on Even Longer

Sam Grundwerg was originally appointed by the former prime minister, but fell out of favor after he elevated a left-wing activist to a top position in Israel's international fundraising arm

Judy Maltz
Judy Maltz
Consul General of Israel Sam Grundwerg arrives at the Israeli Consulate in LA event to Celebrate the 70th Anniversary of Israel at Universal Studios on Sunday, June 10, 2018, in Los Angeles.
Sam Grundwerg in Los Angeles in 2018.Credit: Willy Sanjuan/Invision/AP
Judy Maltz
Judy Maltz

Sam Grundwerg, chairman of Israel's international fundraising arm Keren Hayesod, will hold onto to his position for another three-and-a-half years as part of a new deal conceived under pressure from the organization's board of trustees.

Former Prime Minister Benjamin Netanyahu had tried but failed to oust Grundwerg after the Keren Hayesod leader recruited a well-known leftist activist for a top position in the organization.

Last month, World Zionist Organization Chairman Yaakov Hagoel agreed to demands from Keren Hayesod’s international trustees that Grundwerg’s appointment be extended until late 2025, when the next World Zionist Congress is scheduled to take place.

The WZO is effectively the parent company of Keren Hayesod, Israel's fundraising arm in all major Jewish communities in the world outside the United States.

Grundwerg’s future at the organization has not been the only source of friction between the WZO and Keren Hayesod in recent years. The two “national institutions,” as they are known, have been embroiled in a dispute for more than a decade now over a block of shares, worth several million dollars, in the Jewish Colonial Trust – a bank set up more than 120 years ago to serve the Zionist cause. The shares, which belong to the WZO, have been held in trust by Keren Hayesod. The fundraising organization has refused to hand them over until the WZO agrees to a list of demands meant to ensure greater transparency in its operations vis-à-vis Keren Hayesod.

A deal on the handover of these shares appears more likely now that the WZO has agreed to let Grundwerg stay on, sources say.

In a letter notifying Keren Hayesod’s world leadership about the extension of Grundwerg’s appointment, World Board of Trustees Chairman Steven Lowy wrote, “I am very pleased that this issue has finally been resolved and this gives Keren Hayesod the much-needed stability and continuity in its senior leadership.”

Lowy was one of two representatives of Keren Hayesod to sit on the 10-person committee tasked with selecting a new chairman of the executive of the Jewish Agency. The committee failed to reach a consensus on any of the candidates that were put forward, resolving last month to begin the search again from scratch.

Hagoel, who serves as acting chairman of the Jewish Agency, headed the selection committee. It had been widely reported that Lowy and David Koschitzky, the other Keren Hayesod representative on the committee, had agreed to support any candidate supported by Hagoel, so long as the WZO chairman agreed to their request to allow Grundwerg to extend his contract. Koschitzky, a former chairman of the World Board of Trustees, recently resigned from his executive roles at Keren Hayesod.

In November 2020, Lowy and Koschitzky were part of a group of Keren Hayesod trustees, representing Jewish communities outside Israel, that sued the WZO, alleging that a deal it had reached to oust Grundwerg, concocted by Netanyahu behind the scenes, violated Keren Hayesod’s bylaws. The then-prime minister had tried but failed to get one of his political loyalists appointed to the high-profile position.

The WZO ultimately agreed to the trustees' demand that Grundwerg remain in his position through April 2022, leading to the case's withdrawal.

Several months ago, a search was conducted to find a replacement for Grundwerg effective this month. When no other candidate was put forward, the trustees recommended that Grundwerg’s appointment be extended until the next World Zionist Congress.

During the World Zionist Congress, which is held every five years, senior positions in the WZO and its affiliate organizations, including Keren Hayesod, are typically divvied up among the various political parties and movements.

Grundwerg, a former Israeli consul general in Los Angeles, was appointed world chairman of Keren Hayesod in late 2018 for a five-year term. As a result of the recent deal, he will get two more years in his contract than originally planned.

Grundwerg replaced Moodi Sandberg, who was forced to step down over his alleged involvement in corruption and bribe-taking in Israel’s purchase of submarines and other naval vessels from Germany.

He had been appointed to the job by Netanyahu upon the recommendation of Ron Dermer, Israel’s then-ambassador to Washington. Grundwerg and Dermer grew up together in Florida.

But Grundwerg fell out of favor with Netanyahu and his close associates when he decided to appoint a well-known critic of the prime minister as chief executive officer of Keren Hayesod. The announcement in March 2020 that Polly Bronstein, a prominent left-wing activist, would assume this top position at Keren Hayesod was met with great surprise in the Jewish organizational world and with concern in right-wing circles.

The day she was supposed to assume her new position in June 2020, Bronstein was notified that the job had been scrapped as part of cost-cutting measures. But sources at Keren Hayesod maintain that the real reason she was fired was due to pressure from Netanyahu. He then attempted to remove Grundwerg from his position.

Since Bronstein’s ouster, Grundwerg has been filling in as chief executive officer of the organization as well.

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