- BWR shall not forbear or refrain from taking a rating action based on the potential effect (economic, political, or otherwise) of the action on BWR, an issuer, an investor, or other market participant.
- BWR and its analysts shall use care and professional judgment to maintain both the substance and appearance of independence and objectivity.
- The determination of a credit rating should be influenced only by factors relevant to the credit assessment.
- The credit rating BWR assigns to an issuer or security shall not be affected by the existence of or potential for a business relationship between BWR (or its affiliates) and the issuer (or its affiliates) or any other party, or the non-existence of such a relationship.
- BWR shall maintain an arms length relationship between its credit rating activity and any other activity and avoid any conflict of interest. BWR does not have any consulting business that may present a possible conflict of interest. BWR shall ensure that its present ancillary business operations namely Education & Training Services and Research Services, which do not necessarily present conflicts of interest with the rating business, shall have in place procedures and mechanisms, to minimize the likelihood of arise of conflicts.
B. Procedures and Policies
- BWR shall adopt written internal procedures and mechanisms to (1) identify, and (2) eliminate, or manage and disclose, as appropriate, any actual or potential conflicts of interest that may influence the opinions and analyses BWR makes or the judgment and analyses of the individuals BWR employs who have an influence on ratings decisions. BWR shall disclose conflict avoidance and management measures it takes.
- BWR’s disclosures of actual and potential conflicts of interest shall be complete, timely, clear, concise, specific and prominent.
- BWR shall disclose the general nature of its compensation arrangements with rated entities.
a) Where BWR receives from a rated entity compensation unrelated to its ratings service, BWR shall disclose the proportion such non-rating fees constitute against the fees BWR receives from the entity for ratings services。
b) BWR shall disclose if it receives 10 percent or more of its annual revenue from a single issuer, originator, arranger, client or subscriber (including any affiliates of that issuer, originator, arranger, client or subscriber).
c) BWR shall encourage structured finance issuers and originators of structured finance products to publicly disclose all relevant information regarding these products so that investors and other rating agencies can conduct their own analyses independently of BWR contracted by the issuers and/or originators to provide a rating。 BWR shall disclose in its rating announcements whether the issuer of a structured finance product has informed it that it is publicly disclosing all relevant information about the product being rated or if the information remains non-public。
- BWR and its employees shall not engage in any securities or derivatives trading presenting conflicts of interest with BWR’s rating activities.
- In instances where rated entities (e.g., Governments) have, or are simultaneously pursuing, oversight functions related to BWR, BWR shall use different employees to conduct its rating actions than those employees involved in its oversight issues.
C. Analyst and Employee Independence
- BWR shall structure reporting lines for its employees, compensation arrangements and periodic reviews there of to eliminate or effectively manage actual and potential conflicts of interest and to ensure that the policies and practices relating there to do not compromise the objectivity of the rating process.
a) BWR’s code of conduct shall also state that a BWR analyst will not be compensated or evaluated on the basis of the amount of revenue that BWR derives from issuers that the analyst rates or with which the analyst regularly interacts。
b) BWR shall conduct formal and periodic review of compensation policies and practices for analysts and other employees to ensure that the policies and practices do not compromise the objectivity of the rating process.
- BWR shall not have employees who are directly involved in the rating process initiate, or participate in, discussions regarding fees or payments with any entity they rate.
- No employee of BWR shall participate in or otherwise influence the determination of the rating of any particular entity or obligation if the employee:
a) Owns securities or derivatives of the rated entity, other than holdings in diversified collective investment schemes /mutual fund units;
b) Owns securities or derivatives of any entity related to a rated entity, the ownership of which may cause or may be perceived as causing a conflict of interest, other than holdings in diversified collective investment schemes / mutual fund units;
c) Has had a recent employment or other significant business relationship with the rated entity that may cause or may be perceived as causing a conflict of interest;
d) Has an immediate relation (i。e。, a spouse, parent, child, or sibling) who currently works for the rated entity; or
e) Has, or had, any other relationship with the rated entity or any related entity thereof that may cause or may be perceived as causing a conflict of interest.
- BWR’s analysts and anyone involved in the rating process (or their spouse or minor children) shall not buy or sell or engage in any transaction in any security or derivative based on a security issued, guaranteed, or otherwise supported by any entity within such analyst’s area of primary analytical responsibility, other than holdings in diversified collective investment schemes / mutual fund units.
- 2.15 BWR’s employees shall not use the company’s property for personal gain nor will solicit nor accept money, gifts or other benefits which are not customary in the normal social intercourse.
- 2.16 Any analyst of BWR who becomes involved in any personal relationship that creates the potential for any real or apparent conflict of interest (including, for example, any personal relationship with an employee of a rated entity or agent of such entity within his or her area of analytic responsibility), shall be required to disclose such relationship to the Compliance Officer.
- 2.17 If an analyst is leaving BWR, he shall be required to inform whether he is joining a client or any of his allied entities which has been analyzed / rated by him in the last 6 months. In such an event a critical review of the work handled by the analyst would be taken up immediately and findings there of shall be presented to the rating committee.