In preparing the response to this questionnaire the ACT has alerted it members to the matter and has explicitly consulted its Credit Rating Working Group consisting of some sixty members and other interested professionals.
Acting in this context as a representative body and not a rated company, it is not appropriate that we seek to answer each of the questions, one by one. We are able to synthesise a response which addresses some of the issues.
The questionnaire is drafted so as to solicit replies instancing examples of noncompliance by rating agencies with the IOSCO Code fundamentals. Perhaps this is inevitable when one is looking at compliance. However we believe that questionnaires are more likely to produce useful results if they are worded in a neutral way – “Have the methodologies used by CRAs been consistently applied (if not, please give examples)?” rather than “Do you know of cases where the methodologies used by CRAs were not consistently applied?”.
It is important that the responses received by CESR are evaluated in the knowledge of this possible bias in some questions.
If the event, we have not received negative feedback about the rating agencies except in one respect with regard to the agencies’ consultations on rating methodology change.
