April 2024 - Moody’s Sets New Course to Rigorously Assess Carbon Transition Net-Zero Plans as a Business

The analytics emphasize the nuances of implementation and rely on the expertise of the rating agency staff. [...] Although the tool does not speak to the credit rating implications of the net zero transition, it provides an assessment of the credibility of companies’ transition plans, information that can be used as part of the credit rating analysis. [...] The highest quality of implementation is “Strong.” Other scores run a spectrum of “Solid,” “Moderate,” “Minimal” and “Undeveloped.” Each aspect of the NZA (including implementation) contains detailed discussions of the business and technical dimensions of the plan. [...] The track record of the technologies and the issuers’ involvement with the technologies matter. [...] (Proprietary) 8 The failure of the credit agencies to adequately address the mortgage meltdown created renewed interest in the institutional structure of the credit agencies.