Oana Gheorghiu: The state cannot “play” with its companies. The government is preparing guidelines for ministers
Oana Gheorghiu, at the first Government meeting of his mandate. Photo: Government of Romania
Deputy Prime Minister Oana Gheorghiu said on Saturday evening that the Government is working on the development of guidelines for ministers, which will clearly establish what duties they have in relation to state companies and where the role of the state as a shareholder stops. The statements were made in a program on Antena 3 CNN.
“We are trying to redo some guidelines for the ministers. We are working on them so that a minister and a ministry understand what is allowed and what is not allowed in the relationship with a state company”, said Gheorghiu.
The Deputy Prime Minister explained that the simple fact that the state is the majority or sole shareholder does not mean that it can intervene in a company's activity at its discretion.
“This does not mean that the state can play with this company. The role of the ministry, which represents the state in the company, is the following: to establish very clearly what type of Board of Directors it needs, the profile of the people, if it is, I don't know, a company in the field of transport needs a very good financier, it needs a very good lawyer and a specialist in that field, in transport, let's say. This is the first role of the ministry”, she stated.
The second role is to clearly define the “letter of expectations”, which must include the company's strategy and well-defined indicators. “This must be clear, have the whole strategy in it, include some very clear indicators,” said Gheorghiu.
“The third and most important: performance indicators, because what the Romanian state has done so far, it pretended to put some performance indicators and we have seen and heard of indicators like: to be present every day at work or to meet the council once a month or at a company that is a monopoly to keep its number of customers. For example, this was an indicator at a company that is a monopoly. Obviously the number of customers cannot be an indicator. This is where the role of the ministry stops. So these are the most important things”, explained Deputy Prime Minister Oana Gheorghiu.
Reform of the Boards of Directors in state-owned companies
Gheorghiu also said that the Government has started the reform of the Boards of Directors (CA) in state companies. According to the deputy prime minister, their number will be reduced, and the ministries will be able to appoint only a limited number of members.
“The first step has been taken, you are no longer allowed to be on several boards of directors. The second important step that has been taken is that the ministry can appoint a maximum of one person to the board of directors, if it is a board of three people, or a maximum of two people, if it is a board of five people. So the number of boards of directors has been reduced. We have between 3 and 5 depending on the size of the company, and the ministry can only have one adviser or two, so it must be a minority”, Gheorghiu also said. “The majority of the members of the board of directors are made up of independent people, that is already by law,” stated Gheorghiu.
The Deputy Prime Minister claimed that the reduction in the number of members is already starting to reduce expenses, but the real effects will be seen with the restructuring.
“Part of the losses are beginning to be recovered by reducing the number of members in the Board of Directors, so the expenses with the Board of Directors are reduced, but we will see when the restructuring will really begin. They can begin after we have healthy Boards of Directors, made up of professionals, who in turn have the obligation to select some managers, some directors who will perform”, she continued.
“As a principle, the first condition for a company to have a chance to become successful is to have a Board of Directors made up of professionals, and we look at large companies that operate on these principles. That's why they do well, that's why they perform, because they have a Board of Directors who have an interest in meeting their indicators, and in order to achieve their interest, they must have a good and efficient manager”, concluded Oana Gheorghiu.
