In the legislative proposal discussed in plenary, Mr. Domenici proposed a model of greater transparency by ensuring more competition and calling for stricter rules on civil liability and conflict of interests.
Mr. Stanishev expressed his full support for the rapporteur’s initiative of creating a European Public Rating Agency. “Since the beginning of the financial and economic crisis, three Credit Rating Agencies (Moody’s, Standard & Poors and Fitch) control 95% of the market, making all the decisions and showing a worrying lack of competition. A European Public Rating Agency would reduce this destructive asymmetry and promote transparency and democratic accountability in the financial market. Only by reforming the current system of credit ratings we will be able to make finance a true contributor to growth and jobs”.
PES President Sergei Stanishev underlined that; “this legislative proposal sends a strong political statement: democracy and transparency must be the benchmark by which we evaluate the Credit Rating Agencies. Nowadays, their biased short-term, profit-led judgement and their excess of power can overly influence the economic policy of the EU Member States. This ends up causing yet further financial instability. This proposal is a crucial opportunity to finally make the agencies accountable to the people and their democratically elected governments”.
The PES has long advocated for increasing competitiveness and reducing the role of credit rating, as stated in the declaration “Taming the Agencies”. The PES is also an active member of the campaign “Stop Rating Agencies”.