French Group Renault, for instance, decided to bring to the helm of Automobile Dacia Frenchman Jerome Olive who replaced Francois Fourmont at the beginning of 2010.
In fact, the preliminary results of a survey conducted by Fundatia Noua Europa (New Europe Foundation), set up by Romanian writer and professor Andrei Plesu in partnership with Swiss university St Gallen, reveals that most foreign managers in the board of directors of the top 100 largest companies by turnover are either at their first promotion, or are on the brink of retirement, a sign that foreign shareholders are afraid of leaving their businesses in the hands of Romanian managers.
“Our survey reveals that 70% of the members of the board of foreign companies present on the Romanian market are foreign executives. The nationality of the managers appointed to helm certain multinationals depends on several factors, but the most important one is how international a company is: the larger a company, the more diversified it will be in terms of nationality,” believes economist Liviu Voinea, author of the survey. Voinea also teaches at Bucharest’s Academy of Economic Studies and at the National School of Political and Administrative Studies, and is executive manager of the Group of Applied Economics.
He adds that in private foreign institutions such as Hungarian-held OTP Bank and Turkish-held Azomures, all members of the management team are Hungarians and Turkish, respectively, because they are small companies, for which Romania is one of their expansion markets.
“The appointment of an executive of the same nationality as the shareholders’ is a means of control and of reducing risks on a market such as the Romanian one, which is known to be difficult,” added Voinea.
“It doesn’t matter if a company has been on the market for 15 or for just 2 years, its management structure will be influenced by the same factors: the company’s international presence and the way it entered the market,” he pointed out.
Voinea also highlighted that, if a company enters the Romanian market through a greenfield investment, the management structure by nationality will be similar to that in the country of origin. But if a foreign investor enters the local market through mergers or acquisitions, the management structure will include diverse nationalities.
(English version by Daniela Stoican)