Transformations in Bank Governance and Auditing: Strategic Responses to the Challenges of the Covid-19 Pandemic

Abstract

Currently, at a global level, corporate governance has become an increasingly prevalent concept in economics. It represents a valuable system for investors, as it supports them by providing more advantageous assurance. This assurance entails greater confidence that the funds invested in organizations are being utilized efficiently. Additionally, corporate governance aids companies in implementing mechanisms to easily achieve their objectives. In Romania, within the banking system, bank auditing and governance are fundamental elements. The crisis triggered by the COVID-19 pandemic is a recent one, and its effects have not been fully quantified. During the period 2020–2022, the crisis significantly impacted various aspects of modern economic and social life. For a thorough analysis, we will evaluate the effects the crisis has had on governance and auditing processes within the five main banks operating in the Romanian market: Banca Transilvania, BCR, BRD, ING Bank, and Raiffeisen Bank. The primary objective of this research is a comparative analysis of the economic and financial situation and the governance and auditing practices within the financial systems of Romania and the United States of America. The analysis of banking institutions revealed significant financial difficulties. The level of banking profit, both in Romania and the USA, decreased significantly in 2020 compared to 2019. To address the challenges and emerging risks in the market, banks implemented governance and auditing systems, which they strengthened during the COVID-19 pandemic. UDC: 005.915:[336.71+657.6+614.4](498+73); JEL: B26, G15.