IMPLEMENTING ESG REPORTING IN PUBLIC INSTITUTIONS: A CASE STUDY OF ROMANIA'S INTERNAL MANAGERIAL CONTROL FRAMEWORK

Abstract

This study investigates the potential integration of Environmental, Social, and Governance (ESG) reporting into the existing Internal Managerial Control System within Romanian public institutions. Currently, these institutions are mandated to submit comprehensive internal control reports annually to maintain transparency, accountability, and efficiency. Given the rising global importance of ESG factors, this paper explores how incorporating ESG metrics can enhance the quality and scope of these reports. The research examines the benefits and challenges of this integration, drawing on best practices from countries like Sweden, where ESG reporting frameworks such as the Global Reporting Initiative (GRI) and the Task Force on Climate-related Financial Disclosures (TCFD) are already well-established. The study highlights that integrating ESG reporting can provide a more holistic view of institutional performance, encompassing financial and non-financial aspects, thereby promoting sustainable practices and aligning with international standards. Challenges such as the need for additional resources and the establishment of dedicated structures are acknowledged, but the long-term benefits—improved governance, enhanced environmental performance, and greater social responsibility—outweigh these initial hurdles. The findings suggest that adopting ESG reporting in Romanian public institutions can significantly contribute to a more transparent, accountable, and sustainable public sector, ultimately benefiting society at large.

Keywords

• esg reporting
• internal managerial control
• public instituions
• accountability