Romania is below the EU average according to the Corruption Perceptions Index

Opinion article by Burcin Atakan, Partner, Deloitte Romania, Leader of Fraud Investigation Services, Deloitte Central and Eastern Europe, and Emil Borza-Dediu, Manager, Financial Advisory, Corporate Forensic Services, Deloitte Romania.

In the European Union the average CPI score has also worsened by 2 points as compared to 2023, down to 62/100, with countries such as Germany (CPI score 75/100), Italy (54/100), France (67/100), Spain (56/100), Slovakia (49/100) and Hungary (41/100) recording decreases in their scoring, while others, such as Romania (CPI score 46/100), stagnate below the EU average. 

A global and regional outlook

On February 10th, the US President has paused the enforcement of the Foreign Corrupt Practices Act (FCPA), with the presidential order stating that it had been abused in a manner that harmed the American interests. Prior to this, the Office of the Attorney General had published a memorandum also stating that the Criminal Division's Foreign Corrupt Practices Act Unit would prioritize investigations related to foreign bribery that facilitates the criminal operations of Cartels and Transnational Criminal Organization (TCOs), and shift focus away from investigations and cases that do not involve such a connection. Therefore, following the aforementioned focus shift from the cases that involved corporate entities, the review of the guidelines and policies that governed investigations and enforcement actions under the FPCA is to be performed by the Attorney General.

The FCPA’s noteworthy feature is that it has a transnational dimension, as it applies to regulated entities that promise, offer or pay anything of value to a foreign official, with corrupt intent, for a business purpose, or authorizes the above. The FCPA applies even if the offense was committed outside the US borders, therefore, it has outreach even on European soil and beyond. 

But the FCPA is not the only national legislative act that has transnational applicability, with the UK Bribery Act, which was adopted in 2010, and the French Sapin II Law (Law on Transparency, Fighting Corruption and Modernizing Economic Life), adopted in 2016, having a similar outreach. Actually, the FCPA was a door opener for further regulations and legislations on bribery and corruption at a global level, and the aforementioned transnational legislations coexist with other international instruments, such as the United Nations Convention Against Corruption, regional instruments, such as the EU Convention on the Fight Against Corruption Involving Officials of the European Communities or Officials of Member States, and with the local legislative acts.

The Romanian perspective – a way forward

In 2024, Romania has maintained its CPI score of 46/100, and it ranks at the 65th position out of 180 countries that were included in the study, alongside countries such as Kuwait, Montenegro and Malta, and below the EU average. 

Among Transparency International Romania’s recommendations are improving awareness among citizens about the importance of applying Law no. 361/2022 on the protection of whistleblowers in the public interest – especially in those areas mentioned in Art. 3 as areas where violations of the law can be reported, such as public procurement, prevention of money laundering and terrorist financing, environmental protection, public health –, as well as updating the legislation in the field of public integrity, to remedy the current gaps and inconsistencies, and a Government commitment to an anti-corruption program that will lead Romania to obtain a CPI score of at least 50 points by 2027.

However, the involvement of private entities is also fundamental to strengthen the national ABAC efforts, as corruption and bribery do not solely take place within the public environment, but they also have a private dimension. 

When trying to determine the steps to be taken by a private entity in their ABAC (Anti-Bribery Anti-Corruption) endeavors, it is noteworthy that prevention is often the more cost-effective undertaking in comparison to being exposed to corruption. This is because corruption leads to often irreparable reputational and pecuniary damage. As such, the first preventive step is the determination of the inherent risks to which the entity is subjected, the “as-is”, by considering elements such as the industry, size of the enterprise, level of awareness, existence of any relevant policies and procedures and the existence of an internal reporting channel.

Once inherent risks are identified, entities need to consider certain key elements of compliance:

1. “tone at the top” policy, which implies that management sets in place a “zero-tolerance” approach to any behavior that may be considered as corrupt within its organization and operations;

2. robust procedural framework by developing and implementing clear internal procedures, in accordance with the entity’s actual business profile and activity, and including reporting channels;

3. training and awareness – the personnel should be informed and have the necessary know-how to identify any corrupt behavior, risk, or red flag and to undertake the required mitigation steps.

As a closing note, even though the FCPA was paused in the USA, the global challenge to sustain the enforcement of the ABAC regulations locally persists. More importantly, companies and institutions that are seeking for a longer life span should consider sustaining their continuous preventing efforts and vigilance on the topic. Because corruption may never be fully eradicated; however, through the combined efforts of the public and private entities, it may be significantly reduced, so that countries, societies and economies may generate fairness, prosperity and security.