Credit Rating Agencies' Accountability: Short Notes on a Global Issue
An earlier version of this paper was published in Global Jurist, Vol. 10, No. 1, Advances, p. 1, 2010
16 Pages Posted: 2 Dec 2009 Last revised: 11 Jan 2013
Date Written: August 27, 2011
In the aftermath of the financial crisis Credit Rating Agencies (CRAs) have come under open criticism in the public and legal debates. The picture that has broken surface is one in which CRAs ended up compromising the quality of their activities in order to facilitate the selling of services, and snatch or defend market shares. Nevertheless, in the US and in Europe the regulatory approaches content themselves with focusing on the same administrative tools that have so far proved to be largely ineffective. This is why scholars and opinion-makers have started questioning the current accountability regimes for CRAs, and the reasonableness of keeping the private for-profit nature of the agencies, instead of straightforwardly transforming them into public bodies. But the answers about the optimal nature of, and the most appropriate accountability model for the agencies may only come from considering a different perspective, which puts in place, not a national/regional plan aimed to fence off local misbehavior, but a global strategy to ensure worldwide effective accountability for CRAs. In this direction, the issue can be tackled under either a centralized-political, or a decentralized-judicial point of view.
Keywords: credit rating agencies, financial crisis, regulatory approaches, U.S. law, E.U law, international financial institutions, tort law, public accountability, global law
JEL Classification: K13, K23, K29, K42
Suggested Citation: Suggested Citation