Securities Commission Malaysia revises guidelines to strengthen governance and independence of credit rating agencies

27 February 2023

On 10 January 2023, the Securities Commission Malaysia (“SC”) issued the Guidelines on Credit Rating Agencies (“CRA Guidelines”) which, among other things, seek to enhance and strengthen the role, independence and objectivity of credit rating agencies (“CRAs”) in providing credible credit rating opinions. The enhancement is part of the SC’s continuous efforts to inculcate and promote greater accountability and self-regulation within the capital markets and among the capital market participants.

The key amendments in the CRA Guidelines include enhancements to governance requirements and improvements to integrity of the rating process.

In addition, the enhanced CRA Guidelines also incorporate changes to the SC’s regulatory filings and processes as well as the adoption of regulatory forms for greater operational efficiency.