Rating Agencies Reform

Rating Agencies Reform refers to changes aimed at improving how credit rating agencies assess the creditworthiness of securities and issuers. These agencies, like Moody's and Standard & Poor's, provide ratings that influence investment decisions. During the 2008 financial crisis, their ratings were criticized for being overly optimistic, leading to significant market failures. Reforms typically focus on enhancing transparency, reducing conflicts of interest, and increasing accountability, ensuring that ratings are more reliable and reflective of actual risks. The goal is to protect investors and stabilize financial markets by fostering more accurate and trustworthy assessments.