Transparency Statement

S&P Global Ratings is committed to providing transparency to the market through high-quality independent opinions on creditworthiness. Safeguarding the quality, independence and integrity of our ratings, including by identifying and managing potential conflicts of interest, is embedded in our culture and at the core of everything we do.

Driven by the lessons learned from the financial crisis and new regulations like those introduced by the Dodd-Frank Wall Street Reform and Consumer Protection Act, we have invested heavily to further the quality, transparency and integrity of our ratings. We emerged as a stronger organization. Here, we summarize some of the changes from the last 10+ years.

• We enhanced our criteria and model development processes. Our criteria must undergo an independent review and validation before they are approved for use by our U.S. board of directors. Our validation team also periodically reviews and back-tests existing criteria and models. 
• We publish all our criteria on our website free of charge. We have a formal process to receive and consider investor and other market participant comments on our proposed and in-use criteria. 
• We require mandatory analytical training and certifications. 
• We created cross-functional credit conditions committees, composed of economists and senior analytical staff around the world. The committees review evolving market and macroeconomic developments and publish commentaries on their credit impacts.  
• Our ratings must undergo a formal review by analysts at least annually. Ratings may also be reviewed by our independent Ratings Risk Review function for quality control.
• Our annually published default and transition studies show the performance of our ratings over time. We also increased the information we publish in connection with each rating.

• We fully separated commercial and analytical activities. Analysts cannot engage in sales or marketing activities, commercial staff cannot engage in credit rating activities, and communications between commercial and analytical staff are restricted and, in many cases, monitored by our Compliance department. For example, an analyst may not learn of the commercial aspects of a transaction. 
• Analysts’ compensation does not depend on the volume of ratings they produce or on the rating assigned.
• For each rating decision taken by a rating committee, analysts must disclose any conflict. We also restrict analysts from holding securities in the sectors they rate, and monitor their holdings.
• We periodically rotate the analysts assigned to a particular issuer, and conduct ‘look-back’ reviews of the work performed if an analyst leaves us to take employment with an issuer. 

• In addition to enhancing our various policies and procedures, we built out a Compliance department with approximately 80 staff globally. We embedded Compliance officers in our rating practices to anticipate, identify and address potential issues. Among other activities, Compliance provides training, monitors compliance with regulations and our policies, and reports on significant issues to our regulators.
• We strengthened our approach to identifying, preventing and managing risks. Our Ratings Risk Review and Internal Audit functions provide independent oversight.
• We established an internal control structure with dedicated personnel to strengthen governance and accountability. We file an annual management assessment report to the SEC on the effectiveness of our internal control structure regarding compliance with our policies, procedures and methodologies for determining ratings.

• We are subject to comprehensive regulatory oversight in over 20 countries. Each regulator oversees our compliance with their respective credit rating agency regulations. Common regulatory themes include the mitigation, management and disclosure of conflicts of interest.
• In the U.S., Congress directed the SEC to create an Office of Credit Ratings. OCR conducts on-site examinations at least annually and monitors the activities of the NRSROs throughout the year. The examination includes how we manage conflicts of interest and whether we follow our policies, procedures and methodologies. The SEC summarizes the results of the examination in an annual public report, and submits an annual public report on CRAs to Congress.

S&P Global Ratings is committed to a better public understanding of our ratings processes and the steps we have taken to further ratings quality and manage conflicts of interest. We welcome the everyday scrutiny of our published ratings and underlying methodologies from regulators, academia, the media, and every corner of the capital markets. If you have questions on these topics, please reach out to us: https://www.spglobal.com/ratings/en/contact-us