Welcome to the latest issue of the Journal of Financial Studies. In this edition, we present a collection of papers that delve into diverse topics within the realm of finance, shedding light on pressing issues and offering insightful and innovative research themes. These papers encompass a wide range of themes, including tax complexity, corporate social responsibility, energy sector dynamics, the COVID-19 pandemic’s impact, profitability determinants, non-financial reporting, environmental and financial performances, financial stability, and circular economy development. Each contribution brings forth unique perspectives for the Romanian Journal of Financial Studies, contributing to our understanding of the multifaceted nature of finance and its implications for the global economy.
The paper „Elimination of Tax Complexity Issue through Financial Literacy” examines the role of financial literacy in addressing the complexities associated with taxation. By emphasizing the importance of informed decision-making and financial education, this research highlights how enhanced financial literacy can contribute to more efficient and transparent tax systems.
Moving on, „Corporate Social Responsibility and Value Creation in Romania” explores the relationship between corporate social responsibility (CSR) and value creation in the Romanian business context. The paper investigates how CSR initiatives can generate economic, social, and environmental value, and provides valuable insights for companies striving to integrate sustainability into their operations.
Next, „The Impact of the Altman Score on Energy Sector Firms” investigates the applicability and effectiveness of the Altman Score, a well-established bankruptcy prediction model, in assessing the financial health of firms within the energy sector. This study sheds light on the potential implications of financial distress and bankruptcy risk for energy companies and offers guidance for industry practitioners and policymakers.
„COVID-19 Impact on Corporate Sustainability: Bibliometric Analysis” presents a comprehensive analysis of the scholarly literature pertaining to the effects of the COVID-19 pandemic on corporate sustainability practices. By synthesizing existing research, this paper provides valuable insights into the challenges and opportunities faced by businesses in maintaining sustainable practices during times of crisis.
„Analysis of the impact of financial balance indicators on the stock market performance of companies listed on the Bucharest Stock Exchange” examines the impact brought by the factors that contribute to the determination of financial balance indicators on the profitability of Romanian companies. By analyzing the existence of the link, the outcomes of the paper can provide investors, financial analysts and other stakeholders with valuable information on the importance of financial balance in making investment decisions.
The paper „The Contribution of the EU FDIs to the Reduction of Romania’s Manufacturing Production CO2 Emissions: Higher Exports and GDP Growth” aims to assess the impact of rerouting the foreign direct investments made in Romania towards low carbon manufacturing processes. This can help Romanian economy to gain a larger access to the broader European market, which is reflected in a higher GDP growth.
„Internal Determinants of the Profitability of Algerian Public Banks” focuses on exploring the factors influencing the profitability of public banks in Algeria. By examining internal determinants such as risk management, capital adequacy, and operational efficiency, this study aims to enhance our understanding of the drivers of profitability in the Algerian banking sector.
The following paper, „Financial Literacy and Employment: An Overview and Bibliometric Analysis” investigates the scientific literature regarding the relationship between financial education and employment, conducting a bibliometric analysis. The results of the paper highlight the importance of financial literacy for developing countries, entrepreneurial initiatives, decent jobs, investments in the stock market and rational consumption, and also outlies that there should be collaboration networks between authors, organisations or countries for more effectively financial decisions in the long-term.
The paper „From CSR to ESG: Non-Financial Reporting, Its Benefits and Legislative Implications” examines the transition from CSR to Environmental, Social, and Governance (ESG) reporting. The paper analyzes the benefits of non-financial reporting and explores the evolving legislative landscape surrounding ESG disclosures, providing valuable insights into the changing expectations for corporate transparency and accountability.
Shifting the research focus to the environmental dimension, „The Environmental and Financial Performances on the Energy Sector: Case Study in North America” investigates the relationship between environmental performance and financial performance within the energy sector, with a specific focus on North America. This study explores the potential trade-offs and synergies between environmental stewardship and financial outcomes, contributing to the ongoing debate on sustainable business practices.
„K-Means and Agglomerative Hierarchical Clustering Analysis of ESG Scores, Yearly Variations, and Stock Returns: Insights from the Energy Sector in Europe and The United States” examines the potential relationship between Environmental Social and Governance (ESG) scores, their year-over-year variations, and annual stock returns for some companies operating in the energy sector in Europe and the United States. The results could use to investors that need to adhere to specific ESG investment directives.
In the following paper, „Banking Groups and Aggregate Indicators for Financial Stability in the Romanian Banking Market”, the authors delve into the dynamics of banking groups and their implications for financial stability in the Romanian banking market. By examining aggregate indicators of systemic risk, this research enhances our understanding of the interplay between banking groups and financial stability, offering insights for regulators and policymakers.
The paper „Impact of Sustainable Development on Smart Cities” highlights the importance of accessing European funds for the creation of a Smart City urban area. The benefits of implementing such projects with non-reimbursable financing are primarily represented by the achievement of sustainable development and implicitly contribution to the protection of the environment and the reduction of pollution.
Lastly, the opinion, „The Implications of Circular Economy Development at European Level” explores the implications of circular economy development within the European context. By examining the benefits, challenges, and policy implications of the transition to a circular economy, this study contributes to our understanding of the potential economic and environmental gains associated with circularity.
The papers presented in this special number of the Journal of Financial Studies offer a wealth of knowledge and valuable insights into various facets of the financial research. From the elimination of tax complexity through financial literacy to the implications of circular economy development, each paper contributes to our understanding of critical issues in finance. I hope that the research presented in this journal will inspire further inquiry and stimulate meaningful discussions among scholars, practitioners, and policymakers, ultimately leading to advancements in the field of economics and finance.

The evolution of trading prices of stocks is influenced by a multitude of factors, some of which are specific to each company (such as financial results, dividend distribution rate, various events that influence its evolution, etc.), while others are of a macroeconomic nature (global economic or political events, general market trends, etc.) or emotional. The intensity of the influence of these factors differs from one company to another, as well as from one period to another. A lot of uncertainty in financial markets marked the year 2022. The amplification of the inflationary phenomenon, the energy crisis, as well as the risks generated by the conflict in Ukraine, made investors reluctant in the stock market, taking positions of „wait and see”, often avoiding making major decisions. At the same time, numerous companies, especially those in the energy sector, achieved exceptional financial results, far exceeding what they had obtained in previous years. Although, according to financial theory, there is a close relationship between financial results and the evolution of trading prices of stocks, the results of the study carried out for the year 2022, including the companies listed on the main market of the Bucharest Stock Exchange, do not confirm such a relationship. Although net profit increased significantly in 2022 compared to 2021, trading prices did not follow such a trend, being in decline for most of the analyzed companies.

The main aim of this study is to investigate some of the strategies that four companies of different sizes in Durres and Tirana Municipalities use for turning their employees into brand ambassadors. It is inevitable for the success of an organization to be measured by the importance that the organization gives to its employees. Employees are considered a significant asset of the organization: thus, they must be treated accordingly. Organizations must pay attention to the complex and increasing demands of their customers. In this regard, managers have to realize the importance and role of the employees in meeting the customer’s demands. Employees represent the image of an organization, which is why activating new strategies and techniques that optimize the workforce efforts would help achieve the organization’s vision and mission.
Under these considerations, four face-to-face interviews were conducted with the owners or HR Managers, or Marketing Managers of one shipping agency, one medium-sized production company in Durres, one big-sized production company, and one company that offers telecommunications services in Tirana, Albania. This study first underlines the importance of evaluating marketing and brand management objectives, and afterward explores the strategies that these companies use for turning their employees into brand ambassadors. Within the framework of this study, the advantages of turning employees into brand ambassadors and the problems that the companies face have been examined. The research results show that the motivation of companies to turn their employees into brand ambassadors is high, but most companies lack proper strategies. One of the big-sized companies chooses to turn into brand ambassadors only those employees who accept or have an interest in using their personal social media in this regard and/or have a great curiosity in marketing and technology.

In general, sustainable economic growth is highly dependent on technological progress, managerial knowledge, and money supply in the economy. Globally, the COVID-19 pandemic has caused structural shocks to economic systems by increasing high economic uncertainty. For this reason, policymakers are exploring alternative measures to stimulate economic growth. And among these alternative measures we also find foreign direct investment, which represents an instrument widely used worldwide. There is a trend among foreign investors that they increasingly focus on the quality of institutions, especially on FDI policies in domestic countries. For this reason, governments of developing countries are increasingly adopting soft policies to attract FDI. Generally, the policies provide substantial taxation provisions. Thus, by stimulating foreign direct investment in global economic operations, short- and long-term growth is achieved. The beneficial effects of FDI are given by their unprecedented impact on achieving sustainability worldwide. The motivation of this study is to scale the effects of environmental quality and good governance on FDI inflows in European Union member countries for the period 2002-2021. We used the estimation of autoregressive distributed lag and error correction models to investigate the association and elasticity of explanatory variables on FDI inflows in EU member countries. Thus, as independent variables we use CO2 emissions from solid fuel consumption and the sum of exports and imports of goods and services. Environmental degradation comes from the depletion of resources by human activity, and ultimately this leads to increased costs and depletion of capital. As a result, environmental quality is crucial to the health of both people and businesses. In the recent economic booms, international trade needs serious attention to form new policies to invite more foreign investors. And as control variables we introduce Government effectiveness index and Gross capital formation. We introduce these variables because it is believed that weak institutional capacity can have a negative impact on economies. The study results suggest that government efficiency and a less regulated environmentally concerned economy drive capital transfer decisions.

The aim of this paper is to highlight the need for financial education among adults in Romania. For this purpose, we will take as a starting point the current level of financial knowledge that the target group possesses. The research’s central hypothesis is the relationship between our nation’s educational level and the current economic and financial predicament. Therefore, the traditional questionnaire will serve as the primary research method for this study. The information obtained from the questionnaire will be related to statistical data concerning the financial field in Romania, with the main result being the dimension of the impact of the educational element in the financial life of Romanians.

This article examines the rise of digital currencies in the Eurozone. By probing into the National Strategy regarding the Digital Agenda for Romania 2020 (Romanian Government, 2015), we are aiming to present future researchers with a set of propositions to continue the inquiry on possible opportunities derived from emerging opportunities associated with innovation in the Decentralized Financial sector. This exploratory case study is determined to identify a positive and advantageous moment for Romania while planning the governmental digital strategy in the Field of action III – eCommerce, research and development, and innovation in Information Technology & Communication (IT&C). Given the strong influence of a well-executed implementation plan to achieve strategic objectives, we consider it crucial to prioritize this subject. In this exploratory case study, we analyzed the development of centralized digital currencies in some European National Central Banks and examined the impact of blockchain technology on the financial sector. Additionally, we provided a detailed analysis of the advantages and disadvantages associated with the increasing popularity of digital currencies. It was concluded that due to the lack of in-depth empirical studies, and due to a relatively young and highly volatile digital currency market, we cannot ignore the chances Romania has to assimilate and develop the latest technologies in the financial sector or to improve the existing e-commerce framework and promote investment in innovation. The outcome of the case study is that there are specific and unique opportunities to improve the existing traditional financial system, by creating digital solutions, flexible and accessible to all consumers in Romania, and beyond.

According to the latest PIF report on the protection of the financial interests of the European Union, in 2021 Romania reported to the European Commission fraud related to European projects worth 1.4 billion euros. The reported amount is quite impressive as it represents over 80% of the total amounts reported as being fraudulently obtained in 2021 by all member states, making Romania a true performer in this regard at the European level.
Starting from these values, using descriptive statistics, the study analyzes the data reported by Romania in the last ten years, compared to the other EU member states, data extracted from the PIF Reports (2012-2021), trying to verify if Romania’s status as a champion in terms of fraud with European funds is fully deserved or circumstantial.
Although the numbers show that Romania is indeed a performer in this regard, both in terms of value and the number of reported cases, these values must be viewed in context, as they are influenced by a wide series of factors, including reporting errors, the capacity and willingness of member states to detect irregularities, as well as the particularities of the awarding procedures and contracting periods. Also, in the end, the paper presents some recommendations for strengthening efforts to combat the phenomenon of fraud related to EU funds in Romania.

This paper explores the impact of a company’s performance on the economy, with a focus on Albanian insurance companies and their importance in the non-banking financial sector. The paper aims to analyze the profitability of these companies by examining various internal factors such as company size, capital volume, liabilities, liquidity, growth rate, and fixed assets, with a specific focus on their return on assets (ROA). To achieve this objective, the paper uses quantitative methods to study the relationship between these variables. The sample comprises 10 companies in the Albanian insurance market, including both life and non-life insurers, studied between 2014 and 2021. The results show that only company size has a positive impact on profitability, while not all other variables were significant, irrespective of their direction. Ultimately, the paper demonstrates that a company’s good performance can positively affect the economy in which it operates.

The concept of corporate governance of public entities is evolving. Corporate governance in public institutions, as a method of management and control, requires clear rules and principles of integrity, transparency and accountability, well-defined risk management and control mechanisms, elements that are essential for achieving public entities’ goal, which means meeting public needs.
Corporate governance is a process through which management monitors and maintains a corporation’s compliance with laws and regulations. Is it necessary to use corporate governance in public entities? Can it reduce expenditure or budget deficits, ensuring an efficient use of public funds? Can it eliminate corruption and improve the performance of public entities?
The purpose of this study is to carry out an academic analysis of the evolution of the corporate governance in public entities and to highlight its effectiveness, through principles that encourage better decision-making and resource efficiency. The applied methodology involves focusing on the in-depth study of the subject using the analytical method. Moreover, the study draws comparisons of different models on the aspects researched, using comparative analysis. In conclusion, good corporate governance is essential for any organization to ensure the sustainability of its resources and operations, with a direct effect on the entity’s performance.

The importance of knowing the effects resulting from the adoption and implementation of monetary policy decisions on economic variables is a decisive factor of this article, which directed our attention to the issue of monetary policy measures. Taking into account the thematic area, this concept falls, without exception, in the field of the monetary economy, so it allows the author to carry out a rigorous, complex analysis supported by notions found in the field of finance, economic-financial integration, international relations, as well as macroeconomics.
Identifying the behavior of central banks in establishing monetary policy strategies constitutes the fundamental objective of the paper and can provide a conclusive and appropriate picture of both the objectives considered and their prioritization. A standard approach in this context is to estimate a central bank reaction function in the form of a Taylor rule. By using the previously mentioned method, the identification of the final objectives of the monetary policy authorities through the lens of the promoted policy is considered. The analysis will focus on states such as Romania, Hungary, Poland, and the Czech Republic, all committed to adopting a single currency according to the Treaty on the Functioning of the European Union. The present analysis has brought to the fore the monetary policy measures and strategies used mainly by Central and Eastern European central banks.