IsraelLawCan the board of an Israeli company delegate its powers to a committee or the CEO?
The Companies Law 5759-1999 gives the board a supervisory role rather than an operational one. Section 92 lists what the board does, including setting policy, supervising the general manager and approving the financial statements, and Section 121 makes the general manager responsible for day-to-day management within the policy the board has set. Section 110 permits board committees, subject to the qualification that a committee containing someone who is not a director may only advise and recommend. Section 112(a) draws the line: certain decisions must be taken by the board sitting as a board, and under established Israeli practice that same protected list constrains what may be pushed down to the general manager.
For a foreign parent running an Israeli subsidiary this shapes how remote governance is built. A standing delegation to the local general manager can cover contracts, hiring, banking and ordinary commercial decisions, and Israeli banks routinely ask to see the board resolution and the signatory rules before opening or amending an account. What cannot be outsourced is the annual approval of the financial statements and any dividend outside a framework the board fixed in advance, so a board that convenes once a year will not be enough. Minute every delegation and its limits, because a counterparty relying in good faith on an officer who acted beyond the delegated scope will often still bind the company.
- Governing law: Sections 92, 110, 112(a), 121 and 288, Companies Law 5759-1999
- Competent authority: Israeli Companies Registrar (Rasham HaChavarot) for filings; the Economic Department of the Tel Aviv District Court (HaMachlaka HaKalkalit) for governance disputes
- Cannot be delegated: setting general company policy, approving the financial statements, appointing directors where the board holds that power, and distributions outside a framework the board itself set
- Fees and timing: a delegation resolution takes effect once passed and minuted, with no Registrar filing and no fee; the company's annual Registrar fee remains approximately NIS 1,500 (2026) at the early-payment rate
- Documentation: banks and counterparties normally require the signed board resolution together with a current signatory-rights certificate before acting on a delegation
From the full guide: Directors & Corporate Governance in Israel: Duties, Liabilities & Best Practices
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