Insights from the 2nd episode of Academia de Guvernață: The Importance of Specialized Education in the Context of the Efforts to Professionalize Board Members
In the second episode, Gabriela Hârțescu, PhD, Dean and Co-founder Envisia - Boards of Elite, and Mihai Precup, State Secretary within the Prime Minister's Office, talked about the importance of specialized education in the context of the efforts to professionalize the role of board members in state owned enterprise and considering Romania's strategic objective of joining the OECD.
The year 2023 has marked a significant milestone in corporate governance, with the Organization for Economic Co-operation and Development (OECD) revising its report and offering clear recommendations for enhancing governance practices. As highlighted in a recent episode of the Governance Academy on Profit News TV, these changes have drastically transformed the legislative framework surrounding corporate governance in Romania. Mihai Precup, President of the Agency for Monitoring and Evaluating the Performance of Public Enterprises (AMEPIP), discussed the critical need for stable governance structures, emphasizing that temporary appointments in boards, or "provisional roles," pose a severe challenge to company performance.
Precup says that these provisional roles are affecting companies, as they prevent the establishment of key performance indicators (KPIs) necessary for holding board members accountable. The lack of continuity and solidarity among board members, due to staggered expiration of mandates, undermines the very principle of collective responsibility. AMEPIP's strategic goal is to eliminate these provisional appointments and ensure a robust, transparent governance framework, which is essential for Romania's aspirations to join the OECD.
In pursuit of this goal, AMEPIP has recently partnered with Envisia – Boards of Elite, the first business school in Central and Eastern Europe dedicated to providing cutting-edge education and consultancy services for board members. This partnership aims to support the principles of corporate governance and continuous learning at the board level. Precup expressed optimism about this collaboration, noting that the OECD has recognized and endorsed the initiative, suggesting that specialized training for public enterprises and governance departments could greatly benefit the sector.
Dr. Gabriela Hârțescu, Dean and Founding Member of Envisia, emphasized the importance of this partnership, highlighting the need for tailored training programs that reflect the specific challenges faced by public enterprises. These programs are designed to be dynamic and applicable, featuring workshops that facilitate the exchange of experience and the incorporation of AMEPIP's feedback on critical issues. This approach ensures that the training remains relevant and immediately useful to participants.
The discussion also touched on the evolving competencies required of board members in today's complex environment. Hârțescu pointed out that board members need a broad range of skills, including macroeconomic and geopolitical knowledge, financial strategy, sustainability, digital transformation, and human resource policy. These competencies are increasingly vital as boards are responsible for shaping organizational strategy and contributing to sustainable development.
As companies face an ever-changing economic climate, with shifting supply chains and the growing importance of sustainability, boards must be equipped to navigate these challenges. Hârțescu noted that new regulations, such as the Corporate Sustainability Reporting Directive (CSRD), require companies to provide both financial and non-financial reports that demonstrate a long-term development trajectory. Additionally, the digital transformation and the rise of artificial intelligence present both opportunities and risks, including heightened cybersecurity threats, which boards must be prepared to address.
Finally, Hârțescu highlighted the critical role of human resources in governance, particularly in attracting and retaining talent within the framework of diversity, equity, and inclusion. She stressed that board members must embody core values such as professional integrity and ethical conduct to effectively fulfill their roles.
This second episode of the Governance Academy underscores the importance of continuous education and the development of new competencies among board members to meet the challenges of modern corporate governance. Through strategic partnerships and a focus on practical, applicable training, institutions like Envisia are playing a crucial role in shaping the future of governance in Romania and beyond. The entire discussion is here.
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