Sorana Baciu is a State Secretary with the Prime Minister Chancellery, where she is responsible for the coordination of the relationships with OECD and development policies for the domestic capital. Mrs. Baciu served as a State Secretary with Ministry of Economy, Commerce and Relations with the Business Environment from January–October 2015. She has extensive expertise in general management, corporate strategy, and corporate finance, with over 20 years of experience in the private and public field in senior positions. Mrs. Baciu had an international career in investment and commercial banking (within ING Bank and Porsche Finance Group Romania), as well as in oil and gas (within OMV Petrom S.A). In October 2014 she established a consultancy practice focusing on business performance improvement, change management and turnaround, and investment advisory. Mrs. Baciu is a committed civic activist and has held different positions within non-profit organizations.
Christopher P. Skroupa: What was your mandate as Secretary of State with the Ministry of Economy in the current technocratic government? How have 20 years in the private sector helped you achieve that mandate?
Sorana Baciu: The main areas I coordinated were state-owned enterprises, mineral resources, industrial policies, competitiveness and innovation. One of the most important objectives of my mandate and also of the current (technocratic) government has been the implementation of corporate governance in state-owned enterprises (SOEs) so they can be managed as private ones, in terms of financial performance and business ethics.
While the legal frame for corporate governance existed, namely Government Emergency Ordinance No. 109/2011 (OUG 109) on corporate governance in state-owned enterprises, its provisions had not been applied consistently and no other document has clearly defined the State’s ownership policy.
In 2016, the Ministry of Economy and the Ministry of Finance produced a comprehensive analysis of the OUG 109 implementation stage in all Romanian ministries. Based on the conclusions of this analysis, the Ministry of Economy drafted a memorandum on state ownership policy that was counter-signed by the Ministry of Finance, Ministry of Transport and Ministry of Energy, as stakeholders of the largest number of SOEs subject to corporate governance principles implementation. The memorandum was approved by the Romanian Government this August.
In addition, in the largest five state-owned enterprises in the Ministry of Economy’s portfolio, selected on criteria such as strategic importance in the economy, along with development and growth potential, a complex recruitment process for Board of Directors members was initiated and finalized in August this year too. We trust the new boards will achieve the performance indicators able to transform the five enterprises in strongly competitive units and raw models for other SOEs.
During my 20 years in the private sector, I would say focus and discipline, team work, SMART objective strategy and, more importantly, rigorous follow-up on each helped me to achieve the mandate I had in the Ministry of Economy.
Skroupa: How do you feel your experience in the private sector has contributed to ensure better governance for the state-owned companies?
Baciu: First, it is important to assess which companies to privatize and what percent. Unfortunately, the privatization of most state-owned companies has not proved entirely successful after the falling of the communist regime in 1989.
I’ve had the chance to work for a company where privatization was successful and transformed it in one of the strongest in Europe, with highly efficient management. It was not an easy process, and it entailed a continuous dialogue between all relevant parties involved (the strategic investor, the state as a minority shareholder, the capital markets, communities, employees). More information can be found in the Harvard Business School Case study on OMV Petrom.
My seven years with the company have taught me what performance means in an organization: a function between clear objectives, capabilities and motivation. Currently, only several large state-owned enterprises can attract investors’ interest and most of them are of strategic importance, therefore the State is willing to privatize just a minority stake.
Last but not least, my experience as an entrepreneur in the field of business performance improvement, change management/turnaround, and investment advisory, has enabled me to have an even more pragmatic approach towards strategy and results.
Skroupa: Recently you have been appointed a State Secretary at the Prime Minister’s Chancellery. What is your mandate in this new position and to what extent does your previous experience at the Ministry of Economy help you achieve it?
Baciu: My new position encompasses two main priorities: strengthening the SMEs sector and development of domestic investments as well as the coordination of relations between Romania and OECD (Organization for Economic Co-operation and Development). SMEs weight in one country’s national economy is one of the most accurate indicators of a healthy economy of that country. In Romania, local SMEs represent over 95% of the total number of active companies. We are looking at the main issues the SMEs are facing on their development path, and try identify the best solutions to help them grow. One important direction is ensuring a conductive legal and fiscal framework that encourages SMEs to extend their business, including abroad, and to become competitive at regional level.
As regards OECD, I run the Interministerial Committee for the Coordination of the Relations with OECD, purposely established by the Chancellery to accomplish one of the strategic objectives of the Romanian foreign policy – the admission of the country to OECD. The benefits of becoming an OECD member are manifold: a) Enhance Romania’s reputation and trust of the wider international community by participating in the preparation of OECD reports and analyses; b) Help in accelerating economic development by identifying good practices, improving competitiveness and coordinating domestic and international policies of its members; c) Participate at the global level in multilateral agreements; d) Adoption of high standards in the fields of corporate governance, quality of public governance, international business, environment, social sector and labor market, as well as nuclear and chemical safety or bribery aspects. I am glad to say the experience at the Ministry of Economy has proved very helpful. Actually I am a part of the same system, I work with people I know and trust, and we all have the same goal: to make Romania a better country to live in.
Skroupa: As one of Romania’s highest ranking women officials, how do you feel gender has played a role in your transition from the private to public sector?
Baciu: I would say gender has not played a significant role in this process. While there are some, let’s say, “cultural differences” regarding the gender diversity approach in the private and public sectors, being an active sustainer of women promotion in my former and current positions in Professional Women’s Network (PWN) association has helped me to understand the perceptions and expectations of professional women in both private and public sectors.
Moreover, being a part of PWN has given me the chance to see and experience a different style of leadership based rather on strong human relationships and common aspirations, than on formal authority and this helped me to build solid communication bridges with the teams I lead at the ministry.
And speaking of PWN, one of its pillars is called Women on Boards and its aim is to help women accede to Board of Directors positions. I am very glad to say the gender diversity rule was applied strictly during the selection of the board members for the five companies mentioned in the answer at question. This represents a major step in acknowledging women’s capacity to be decision makers!
Christopher P. Skroupa is the founder and CEO of Skytop Strategies, a global organizer of conferences.