MECHANISMS OF CHANGE RESISTANCE IN CORPORATE GOVERNANCE LEGISLATION
MECHANISMS OF CHANGE RESISTANCE IN CORPORATE GOVERNANCE LEGISLATION

Summary/Abstract: The legislation on corporate governance has been implemented as a result of the acceptance of the obligation of compliance by the Government of Romania and not as an internal emulation, not as a conscious necessity. In this context, Emergency Ordinance 109/2011 on Corporate Governance of Public Enterprises and Subsequent Regulations were a product of tensions between innovative ideas contained in the Corporate Governance Principles stated by the Organization for Economic Cooperation and Development and the old mentality, methods and practices which were used in the management of enterprises in which the state or territorial administrative units had holdings and were in a control position. Starting from the hypothesis of resistance to change, a synthetic examination of the entities and mechanisms was made by which the conception to be removed succeeded in perpetuating its existence.Information needed to know the entities involved and to understand the role they play in applying corporate governance legislation such as tutelage public authorities, corporate governance structures, nomination and remuneration committees, selection boards, and independent experts have been presented. Subsequently I have described the mechanism by which the tutelary public authority preserves its dominant position and imposes its conception on the development and orientation of the action of the public enterprise by exploiting the advantage given by the elaboration and use as reference of the letter of expectation or by the revocation of the members of the administrative or management bodies, without payment of damages, in the event of failure to complete negotiations on performance indicators corresponding to the objectives of the letter of expectation. The paper also describes a punctual situation in the selection process that allows a candidate to be rejected by interpreting the information provided in the application file as inappropriate in contradiction with accepting a candidate by considering the information in the file as inconclusive, but which can be clarified by completing with other data. The analysis was completed by highlighting the complexity of the process of selection of the members of the management and administration bodies and the accentuation of certain factors that may alter the result of the selection. The conclusion drawn from the analysis of the articles in the relevant legislation leads to the need to thoroughly analyze corporate governance legislation and its subsequent regulations with a view to updating, increasing its consistency, simplifying and clarifying it.

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