Performance Improvements for Romanian SMEs and Their Predictors

Sorin-Romulus Berinde and Laura-Maria Herța
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Sorin-Romulus Berinde: Department of Business, Faculty of Business, Babeş-Bolyai University, 7 Horea Street, Cluj-Napoca, 400174 Cluj, Romania
Laura-Maria Herța: Department of International Relations and German Studies, Faculty of European Studies, Babeş-Bolyai University, 1 Emmanuel de Martonne Street, Cluj-Napoca, 400090 Cluj, Romania

Sustainability, 2021, vol. 13, issue 15, 1-13

Abstract: The corporate governance of Romanian SMEs states that these companies have been less and less able to generate performance over the last few years. An average number of 1.273 SMEs per year have been included in the study, coming from all the eight local development regions of Romania. The data covers a period of 14 financial years, between 2005 and 2018. The findings showed, after statistical computations using regression models, that the performance of Romanian SMEs depended on the level of external managerial consultancy that corporate governance received from specialized companies and on the increasing level of wages. Given the high flexibility potential of SMEs, these choices are seen as tailored actions and strategies to compete successfully and support sustainable performance in the local context where its trend is downward. Moreover, the act of achieving performance at present is upheld by the performance attained in previous financial years. The impact of these factors could be established as a matter of priority in a long-term approach, for a time lag of up to 3 years. Moreover, the performance of companies covering all the local development regions is influenced only to a small degree by taxation levels, by the frequency of tax supervision performed by government institutions, by the capacity of corporate governance to be up to date with legislative change or by the self-financing of the activity conducted by the companies.

Keywords: performance; sustainable SMEs; local development; managerial consultancy services; excessive taxation; legislative regulations; self-funding strategies; corporate governance (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
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