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Recent Events
Standard & Poor's Contemplates Enterprise Risk Management in All Corporate Credit Ratings
February 4, 2008 3:12 PM
Rating agency Standard & Poor's (S&P) has recently proposed to introduce analysis of Enterprise Risk Management (ERM) into the corporate credit ratings process. Stakeholders are invited to review the proposal, "Request For Comment: Enterprise Risk Management Analysis For Credit Ratings Of Nonfinancial Companies," and provide comments to S&P before March 1, 2008. Click here for a link to the document.
Since 2005, S&P has included ERM analysis in ratings processes within the financial services and insurance industries. A pilot project to include ERM analysis in ratings of energy companies began in April 2006. This new development would significantly augment the importance of ERM for all non-financial companies however.
Lead author of the proposal, Managing Director and S&P Primary Credit Analyst, Steve Dreyer has been a frequent participant in InterCEP National Roundtables and general research efforts. InterCEP's ongoing research in this area suggests that this prospective shift of rating agency policy could provide additional bottom-line rationale for business resilience and preparedness. We encourage recipients of this briefing to review the proposal and forward comments to S&P's before the March 1 deadline.