Enterprise Risk Management (ERM) Analysis for Credit Ratings of Non-financial Companies

Standard & Poor's Request for Comment

Management analysis is arguably the most qualitative and immeasurable among the many considerations of a Standard & Poor's Ratings Services' credit rating. A rating committee's opinion of management's overall capabilities, fidelity to and consistency of a sound strategy, and adaptability to changing circumstances are perhaps the strongest influences on the future direction of a credit rating. Nevertheless, the quality of management judgment is not as easily benchmarked by quantitative metrics in the way that ratios and models of cash flow adequacy, liquidity, earnings capacity, and leverage help shape our views of a company's financial profile.

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