Item 1. BUSINESS

BACKGROUND

As used in this report, except where the context indicates otherwise, the terms “Moody’s” or the “Company” refer to Moody’s Corporation, a Delaware corporation, and its subsidiaries. The Company’s executive offices are located at 7 World Trade Center at 250 Greenwich Street, New York, NY 10007 and its telephone number is (212) 553-0300.

THE COMPANY

Company Overview

Moody’s is a global integrated risk assessment firm that empowers organizations and investors to make better decisions. Moody’s reports in two segments: MIS and MA. Financial information and operating results of these segments, including revenue, expenses and Adjusted Operating Income, are included in Part II, Item 8. Financial Statements of this annual report and are herein incorporated by reference.

			Independent provider of credit rating opinions and related information for over 100 years						Global integrated risk assessment firm providing credit rating opinions, analytical solutions and insights that empower organizations to make better, faster decisions						Provider of financial intelligence and analytical tools supporting customers’ growth, efficiency and risk management objectives

Moody's has evolved over the last 15 years as our customers' needs have changed and we expanded our capabilities
									2007 - 2016
						Expanded beyond ratings agency
						•Established Moody’s Analytics •Built the ERS business (e.g., Fermat, B&H) •Expanded ratings to China (i.e., CCXI)
									2017 - 2021
						Built out substantial data and analytics capabilities
						•Complemented ERS business with private company information (i.e., BvD) •Accelerated capability expansion (e.g., company database, CRE data, ESG data) •Invested in insurance data and analytics capabilities, including weather and disaster modeling (i.e., RMS)
									2022 and Beyond
						Positioned to serve a wide range of risk assessment markets
						•Competitive differentiator: integration of data and analytics combined with expertise and technology enablement •Further investment in data and analytics capabilities such as private company, CRE and ESG to serve high growth risk assessment use cases (e.g., KYC and compliance)

Moody's Investors Service Overview

Moody's Investors Service (MIS) publishes credit ratings and provides assessment services on a wide range of debt obligations, programs and facilities, and the entities that issue such obligations in markets worldwide, including various corporate, financial institution and governmental obligations, and structured finance securities. A rating from MIS enables issuers to create timely, go-to-market debt strategies with the ability to capture wider investor focus and deeper liquidity options.

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The Benefits of a Moody's Rating
Investors seek Moody's opinions and particularly value the knowledge of its analysts and the depth of Moody's research
Access to capital						Transparency, credit comparison and market stability						Planning and budgeting						Analytical capabilities
•Moody’s opinions on credit are used by institutional investors throughout the world, making an issuer’s debt potentially more attractive to a wide range of buyers.						•Signals a willingness by issuers to be transparent and provides issuers with an independent assessment against which to compare creditworthiness.						•May help issuers when formulating internal capital plans and funding strategies.						•Among ratings advisors, Moody’s has a strong position and is well-recognized for the depth and breadth of its analytical capabilities.
•A Moody’s rating may facilitate access to both domestic and international debt capital.						•Moody’s ratings and research reports may help to maintain investor confidence, especially during periods of market stress.

Ratings revenue is derived from the originators and issuers of such transactions who use MIS ratings to support the distribution of their debt issues to investors. Ratings are disseminated via press releases to the public primarily through a variety of electronic media, including the internet and real-time information systems widely used by securities traders and investors.

MIS by the Numbers
			35,000+
			Rated Organizations and Structured Deals
						5,300+									3,500+									15,500+
			Rated Non-Financial Corporates						Rated Financial Institutions						Rated Public Finance Issuers
						9,000+									1,000+									445
			Rated Structured Finance Deals						Rated Infrastructure & Project Finance Issuers						Rated Sub-Sovereigns
						145									49									$73 trillion
			Rated Sovereigns						Rated Supranational Institutions						Total rated debt outstanding
						190
			Rating Methodologies

MIS also earns revenue from certain non-ratings-related operations, which primarily consist of financial instruments pricing services in the Asia-Pacific region, revenue from ESG research, data and assessments and revenue from ICRA's non-ratings operations. The revenue from these operations is included in the MIS Other LOB and is not material to the results of the MIS segment.

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Moody's Analytics Overview

Moody's Analytics (MA) is a global provider of: i) data and information; ii) research and insights; and iii) decision solutions, which help companies make better and faster decisions. MA leverages its industry expertise across multiple risks such as credit, market, financial crime, supply chain, catastrophe and climate to deliver integrated risk assessment solutions that enable business leaders to identify, measure and manage the implications of interrelated risks and opportunities. MA’s proprietary data, research and analytics combined with cloud-based software tools deliver solutions to meet customer needs as they arise. MA’s subscription businesses provide a significant base of recurring revenue to mitigate cyclical changes in debt issuance volumes that may result in volatility in MIS’s revenues.

Curated Data Combined with Analytics are the Foundation of MA's Integrated Risk Assessment Strategy
															Domain Expertise
Curated Data																														Best in Class Analytics
Proprietary data assets allow companies to inform and perform many critical business activities with trust and confidence																																										MA's approach to deepening available data sets and ability to combine with research, analytic tools and software is driving a more integrated understanding of risks and opportunities
			Transparency									ç																					è			Benchmarks
			Efficiency									Better Decisions																		Analytics
			Convenience																											Insights

MA Customers by the Numbers
			14,900 +
			Total MA customers
						1,800+									2,300+									3,600+
			Asset Managers						Commercial Banks						Corporations
						200+									900+									5,300+
			Securities Dealers and Investment Banks						Insurance Companies						Government & Other Entities
						800+									165									29,000+
			Real Estate Entities						Countries where MA customers operate						Customer users accessed the Moody's research website in 2021
						244,000+
			Individuals accessed the Moody's research website

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Sustainability

Moody’s manages its business with the goal of delivering value to all of its stakeholders, including its customers, employees, business partners, local communities and stockholders. As part of this effort, Moody’s advances sustainability by considering environmental, social, and governance (“ESG”) factors throughout its operations and products and services. The Company uses its expertise and assets to make a positive difference through technology tools, research and analytical services that help other organizations and the investor community better understand the links between sustainability considerations and the global markets. Moody’s efforts to promote sustainability-related thought leadership, assessments and data to market participants include adhering to the policies of recognized sustainability organizations that develop standards or frameworks and/or evaluate and assess performance, including: the Global Reporting Initiative; Sustainability Accounting Standards Board; and the World Economic Forum’s Stakeholder Capitalism metrics. Moody's also issues an annual report on Stakeholder Sustainability and on how the Company has implemented the Task Force on Climate-related Financial Disclosures (“TCFD”) recommendations. Moody’s sustainability-related achievements in 2021 included the following:

–Established three goals to increase representation of women and employees of racial and ethnic underrepresented groups; published our EEO-1 data;

–Accelerated our net-zero commitment to 2040, a decade earlier than the Paris Agreement goal;

–Received an ‘A’ score from CDP on climate action for the second consecutive year; and

–Became a founding member of the Net Zero Financial Services Provider Alliance, part of the Glasgow Financial Alliance for Net Zero (GFANZ) and joined the Taskforce on Nature-related Financial Disclosures (TNFD).

The Board oversees sustainability matters, with assistance from the Audit, Governance & Nominating and Compensation & Human Resources Committees, as part of its oversight of management and the Company’s overall strategy. The Board also oversees Moody’s policies for assessing and managing our exposure to risk, including climate-related risks such as business continuity disruption or reputational and credibility concerns stemming from incorporation of climate-related risks into the credit methodologies and credit ratings of MIS.

Three Pillars of Moody's Sustainability Strategy
Better Business									Better Lives									Better solutions
For Moody's operations and value chain									For Moody's people and communities									For market transformation
Strive to embed responsible, sustainable decision-making in everything Moody's does.									Aim to create a forward-thinking, inclusive culture across Moody's people and communities.									Build/develop products to help our customers identify risks and opportunities and provide meaningful performance measurements and insights

HUMAN CAPITAL

Moody’s purpose is to bring clarity, knowledge and fairness to an interconnected world. The Company’s success in achieving its purpose is only possible through the collective contributions of its global employee population whose members possess the unique combination of skills, professional experience and diversity of backgrounds needed to advance the Company’s business and contribute to the communities in which it operates. Moody’s believes that it is essential to: i) create a workplace where its employees feel valued and inspired; ii) provide an environment that fosters a culture of independence, inclusion and intellectual leadership; and iii) support peer collaboration and professional growth.

As a global integrated risk assessment firm, attracting, supporting and retaining skilled talent is essential to the Company’s success. Moody’s addresses these goals by:

–championing diversity, equity and inclusion among employees;

–seeking to provide market-competitive compensation and benefits and rewarding employees for their contributions to the Company’s strategic and operational goals;

–offering wellness programs;

–supporting employee learning, development and skills enhancement; and

–advancing employee engagement.

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Diversity, Equity and Inclusion

Moody's believes it is imperative to be visible champions of diversity, equity and inclusion because differing thoughts and perspectives help to enrich the Company’s offerings to its many stakeholders and improve performance. The key objectives for which the Company focuses with respect to these items include:

–incorporating diversity, equity and inclusion into Moody’s business strategy;

–establishing leadership accountability with respect to diversity, including through executive compensation programs;

–working to increase diverse representation (e.g., women and ethnic groups);

–continuing to advance women and ethnically diverse employees in leadership roles;

–enhancing employee training in diversity, equity and inclusion matters;

–promoting equal employment opportunities in all aspects of employment;

–designing the Company’s compensation practices to provide equal pay for equal work; and

–incorporating market standards, role, experience and performance into compensation decisions.

The executive leadership team’s focus on these items is vital to attract, support and retain its skilled talent.

Moody’s has numerous diversity programs and eight active business resource groups (“BRGs”) including:

–EnAble BRG: advocates for an inclusive, accessible and stigma-free workplace in which employees with disabilities are valued for their talents and have the opportunity to advance and thrive professionally

–Generational BRG: seeks to leverage the insights and experiences of our multi-generational workforce in order to cultivate an inclusive work environment that fosters greater connectedness, supports the development of all generational groups and delivers business value to the firm

–Inclusion BRG: supports all areas of diversity and inclusion combining Moody's BRG chapters. Inclusion creates opportunities for all employees regardless of office size to engage with a BRG

–Minds BRG: seeks to foster a culture at Moody’s where all employees are empowered to discuss and manage their mental health

–Multicultural BRG: seeks to leverage diverse talent by promoting recruitment, professional development and networking opportunities for all ethnically diverse employees at Moody's

–Pride BRG: advocates for a work environment that respects, welcomes and supports lesbian, gay, bisexual and transgender professionals, enabling them to perform to their fullest potential and contribute to the greater goals of the Company

–Veterans BRG: recognizes and supports veterans, active-duty military personnel and military families both at Moody's and in our communities

–Women's BRG: seeks to enhance the recruitment, retention, and professional development of female professionals by implementing programs that foster greater interaction among peers as well as the broader community, while acting as a collective voice for raising women's issues to senior management and enhancing the employment brand

The BRGs represent 44 chapters and more than 6,600 memberships globally as of December 31, 2021. An employee can hold membership in multiple BRGs in a single region.

The Company’s diversity programs include its TIDE program (Talent Aspirations & Alignment, Insights, Development & Career Planning and Exposure & Expansion), which is a high potential employee diversity initiative aimed at elevating women and ethnically diverse employees into leadership positions.

The Company provides and periodically updates information on its BRGs and other diversity, inclusion and equity programs in its various sustainability and stakeholder reports and on its Diversity & Inclusion microsite. See moodys.com/sustainability and moodys.com/diversity for these items. The content of those websites is not incorporated by reference herein.

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The charts below present additional information regarding the diversity of the Company's workforce as of December 31, 2021. The percentage for people of color ("POC") includes those who identified as Asian, Hispanic, Black, American Indian/Alaskan Native, Hawaiian/Other Pacific Island or two or more races. Officers and Managers are calculated using the job categories: executives, senior managers, mid-level managers, and first-level managers. The following data is based on Company records and may involve estimates or assumptions.

Total Workforce: Gender									U.S. Workforce: Ethnicity

Total Officers and Managers: Gender (1)									U.S. Officers and Managers: Ethnicity

(1) Total officers and managers by gender represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies for which this data was not available)

Compensation

Moody’s compensation programs are designed to foster and maintain a strong, capable, experienced and motivated global workforce. An important element of the Company’s compensation philosophy is aligning compensation to local market standards so that Moody's can attract and retain the highly-skilled talent needed to thrive. The Company’s compensation packages include market-competitive salaries, annual bonuses and equity grants for certain employees.

Benefits and Wellness Programs

With respect to benefits, the Company views investments in benefits as an investment in its people. Moody’s is committed to providing competitive benefits programs designed to care for all employees and their families. The Company’s comprehensive programs offer resources for physical and mental health that promote preventive care, awareness and support a healthy lifestyle. The Company also promotes financial wellness and provides for flexible work arrangements, which support the Company’s efforts to create a work atmosphere in which people feel valued and inspired to give their best. Beyond delivering health, welfare, retirement benefits, and paid vacation and sick days, Moody’s extends other benefits to support its employees and their families. To provide competitive benefits, the Company periodically adjusts the nature and extent of benefits, such as parental leave, workplace flexibility and educational support.

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Employee Population

As of December 31, 2021 and 2020, the number of Moody’s employees was as follows:

									December 31,																		Change
Global Headcount									2021						2020												%
MIS
			U.S.						1,459						1,518												(4)		%
			Non-U.S.						3,836						3,533												9		%
			Total						5,295						5,051												5		%
MA
			U.S.						2,647						2,012												32		%
			Non-U.S.						3,882						2,996												30		%
			Total						6,529						5,008												30		%
MSS
			U.S.						728						704												3		%
			Non-U.S.						908						724												25		%
			Total						1,636						1,428												15		%
Total MCO
			U.S.						4,834						4,234												14		%
			Non-U.S.						8,626						7,253												19		%
			Total						13,460						11,487												17		%

The MIS employee population primarily consists of credit analysts, data and operations analysts, credit strategy and methodology professionals, software engineers, sales and sales operations, and international strategy teams.

MA’s employee population primarily consists of software engineers, data and operation analysts, advisory and implementation teams and economists, as well as sales and sales support professionals.

The MSS employee population primarily consists of information technology professionals and other professional support staff such as finance, human resources and legal that support both MIS and MA.

Management monitors employee turnover rates as presented in the chart below:

The increase in the Company's voluntary turnover rates in 2021 compared to 2020 are likely due to the effects of COVID-19 on the labor market. Additionally, MSS involuntary turnover figures in 2020 in the chart above includes employees who separated pursuant to a third-party outsourcing arrangement relating to certain back-office functions. A majority of these employees were hired by the third-party outsourcing provider.

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Employee Engagement, Learning and Development

As a result of the COVID-19 pandemic, the Company enhanced its digital communications with its employees beginning in 2020. These enhanced communications have allowed senior management to continue to interact with employees regarding evolving priorities and its focus on the health, safety and well-being of Moody’s employees during this challenging time.

Learning & Development is one element of Moody’s talent management framework, which includes talent acquisition, performance management, total rewards, succession planning and leadership development. Each of these areas supports the Company’s business strategy and Moody’s culture as a diverse, equitable and inclusive place to work. Moody's views learning and education as an investment in its people that aligns their professional goals and interests with the success of the Company, and helps to retain talent over the longer-term. A number of training programs are available, including leadership development, professional skills development, technical skills, as well as compliance training.

CLIMATE CHANGE

Climate change is a defining issue of our time, and while Moody’s operations have a limited direct environmental impact and we are not considered a major emitter of greenhouse gas (GHG) emissions, we do nonetheless have an important role to play in demonstrating proactive corporate responsibility, setting industry standards and demonstrating best practices when it comes to climate change mitigation. As such, the Company is taking steps to advance climate action by publishing its TCFD report on an annual basis, issuing its decarbonization plan with science-based targets and a comprehensive roadmap and accelerating its commitment to achieve net-zero emissions across its operations and value chain by 2040.

Moody’s Decarbonization Plan outlines tangible strategies for realizing its climate ambitions, including the procurement of 100% of renewable electricity in the Company’s office spaces and optimizing efficiencies in its operations through a “Workplace of the Future” program. The Decarbonization Plan was subject to a vote at Moody’s 2021 Annual Meeting of Stockholders with 93% of votes in favor of the proposal, which underscored that climate considerations and action are now an integral part of the Company’s business strategy, governance, and corporate performance. The costs associated with the implementation of the Decarbonization Plan are not expected to be material.

Furthermore, Moody’s has invested in acquisitions that expand its climate capabilities further, including RMS, Four Twenty Seven and Vigeo Eiris. To integrate these capabilities into our existing offerings, Moody’s is enhancing its technology infrastructure to provide our analysts and researchers with streamlined access to consistent and high-quality ESG and climate insights. These enhancements will allow Moody’s to seamlessly integrate climate considerations into our products and solutions for the benefit of our customers and the capital markets at large.

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MOODY’S STRATEGY

Moody’s corporate mission is to provide trusted insights and standards that help decision-makers act with confidence. Moody’s will continue to invest with intent to defend and enhance its core businesses and expand into strategic adjacencies and new geographies.

Vision			To promote progress through better decisions
Objective			Deliver global integrated risk assessment platform and solutions
Growth Strategy			Invest with intent to grow and scale
Invest with intent to grow and strengthen our core business with a foundation of credibility, transparency, technology, data and analytics						Invest in integrated solutions to allow customers to manage multiple risks, bringing the best of Moody's capabilities									Invest to successfully scale in priority growth markets with highly differentiated products and services
Investment in high growth markets
Execution Priorities			How we will get it done
Sharpen focus on customers						Develop our people and culture									Collaborate, modernize and innovate

Moody’s invests in initiatives to implement the Company’s strategy, including internally led organic development and targeted acquisitions. Illustrative examples include:

Enhancements to ratings quality and product extensions			Investments that extend ownership and participation in joint ventures and strategic alliances			Expansion in emerging markets			New products, services, content and technology capabilities to meet customer demands			Selective bolt-on acquisitions that accelerate the ability to scale and grow Moody’s businesses

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During 2021, Moody’s continued to invest in and acquire complementary businesses as further described below:

Date			Business			Company			Stake			Strategic Commentary
November 2021			KYC			PassFort			100%			A U.K. SaaS-based workflow platform for identity verification, customer onboarding, and risk analysis. The integration of PassFort’s platform into Moody’s suite of KYC and compliance offerings will create a more holistic workflow solution, allowing customers to incorporate Moody’s data, including credit, cyber, ESG, and climate analytics, directly into their proprietary processes.
November 2021			KYC			Bogard AB			100%			A provider of data and information on politically exposed persons (PEPs) in the Nordic region. The acquisition advances Moody’s ability to help customers perform KYC screening and research to address financial crime.
October 2021			Cyber			BitSight			Minority			A provider of cybersecurity ratings, analytics, and performance management tools. In 2021, BitSight acquired VisibleRisk, a cyber risk ratings joint venture created by Moody’s and Team8, a global venture group. The investment enhances BitSight’s offerings and capabilities, to create a comprehensive, integrated, industry-leading cybersecurity risk platform. Moody’s will leverage BitSight’s extensive cyber risk data and research across its growing suite of integrated risk assessment product offerings.
September 2021			Insurance			Risk Management Solutions (RMS)			100%			A global provider of climate and natural disaster risk modeling and analytics. The acquisition expands Moody’s insurance data and analytics business and accelerates the development of the Company’s global integrated risk capabilities to address the next generation of risk assessment.
September 2021			Commercial Real Estate			RealXData			100%			A provider of CRE lease-level portfolio management with benchmarking and rent forecasting capabilities. The acquisition advances Moody's ability to help customers manage their real estate portfolio, analyze performance, and define a strategy in one platform.
March 2021			KYC			Cortera			100%			A provider of North American credit data and workflow solutions. The acquisition enhances Moody’s integrated risk assessment capabilities and significantly extends its coverage in the small and medium enterprise segment. Cortera augments Moody’s extensive Orbis database of private company information and enhances its know-your-customer, commercial lending, and supply chain solutions.

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PROSPECTS FOR GROWTH

Moody’s believes that the overall long-term outlook remains favorable for continued growth of the global fixed-income market and related financial information market, which includes information such as credit opinions, research, data, analytics, risk management tools and related services.

Moody’s growth is influenced by a number of trends that impact financial information markets including:

Health of the world’s major economies						Debt capital markets activity						Disintermediation of credit markets						Fiscal and monetary policy of governments						Expansion of market for integrated data and analytics solutions						Business investment spending, including mergers and acquisitions

In an environment of increasing financial complexity and heightened attention to credit analysis and risk management, Moody’s is well positioned to benefit from continued growth in global fixed-income market activity and more widespread use of credit ratings, research and related analytical products. Moody’s expects that these developments will support continued long-term demand for high quality, independent credit opinions, research, data, analytics, risk management tools and related services. Moreover, pricing opportunities aligned with customer value creation and advances in information technology present growth opportunities for Moody’s.

Moody’s operations are subject to various risks, as more fully described in Part I, Item 1A “Risk Factors,” inherent in conducting business on a global basis. Such risks include currency fluctuations and possible nationalization, expropriation, exchange and price controls, changes in the availability of data from public sector sources, limits on providing information across borders and other restrictive governmental actions.

Environmental, Social and Governance Data and Solutions

ESG data and solutions are expected to play an increasingly important role across both MIS and MA as market participants seek trusted insights and standards to make better decisions.

ESG Integrated Across All Platforms
			Credit Impact									Risk Quantification									ESG Domain
			ESG Classification			ESG Credit Impact Scores						Real Estate Solutions			Risk Analytics & Reporting						ESG Measures						Climate Solutions
																								Index Solutions
			Credit Ratings & Research			Heat Maps						Lending Solutions and Tools			Catastrophe Models						SME Solutions						Sustainable Finance

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Impact of Technology

The pace of change in technology and communication over the past two decades makes information about investment alternatives and risk management solutions widely available. This increase in the availability of information and solutions promotes the ongoing integration and expansion of financial markets worldwide, giving market participants access to a wider range of both established and newer capital markets as well as data and solutions to manage risk. As technology provides broader access to worldwide markets, it also results in a greater need for credible, globally comparable opinions about credit risk, data, analytics and related services and solutions.

MIS Prospects for Growth

Strong secular trends should continue to provide long-term growth opportunities in MIS. Key growth drivers include:

• Debt market issuance driven by global GDP growth;

• Continued onboarding of first time rating mandates;

• Developing a comprehensive sustainable finance offering, including credit impact scores, second party opinions, assessment of net zero and sustainable growth, which is supported by data and research offerings to meet the market’s evolving needs;

• Growth in domestic capital markets through investments in Moody’s Local and affiliates in key markets; and

• Bank disintermediation and the expansion of private credit.

In addition to the factors noted above, growth in global fixed income markets in a given year is dependent on many macroeconomic and capital market factors including:

Interest rates			Business investment spending			Corporate refinancing needs			Merger and acquisition activity			Issuer financial health			Consumer borrowing levels			Securitization activity			Expansion of ratings coverage			Expansion into emerging markets

Rating fees paid by debt issuers account for most of the revenue of MIS. Therefore, a substantial portion of MIS’s revenue is dependent upon the dollar-equivalent volume and number of ratable debt securities issued in the global capital markets.

MIS’s results can also be affected by factors such as:

• Performance and prospects for growth of the major world economies;

• Fiscal and monetary policies pursued by their governments; and

• Whether issuers request MIS ratings to aid investors in making their investment decisions.

However, annual fee arrangements with frequent debt issuers, annual debt monitoring fees and annual fees from commercial paper and medium-term note programs, bank deposit ratings, insurance company financial strength ratings, mutual fund ratings, and other areas partially mitigate MIS’s dependence on the volume or number of new debt securities issued in the global fixed-income markets. MIS’s global coverage positions it well to serve the needs of the global fixed income markets.

While already common in U.S. and Western European markets, an ongoing trend in the world’s capital markets is the disintermediation of financial systems. Issuers increasingly raise capital in the global public capital markets, in addition to, or in substitution for, traditional financial intermediaries. Moreover, financial intermediaries have sold assets in the global public capital markets, in addition to, or instead of, retaining those assets. Moody’s believes that issuer use of global debt capital markets offer advantages in capacity and efficiency compared to traditional banking systems and that the trend of increased disintermediation will continue. Further, disintermediation has continued because of the historically low interest rate environment and bank deleveraging, which has encouraged a number of corporations and other entities to seek alternative funding in the bond markets.

Moody’s also observes disintermediation in key emerging markets where economic growth may outpace internal banking system capacity. Thus, disintermediation is expected to continue over the longer-term, with Moody’s targeting investment and resources to those markets where disintermediation and bond issuance is expected to remain robust.

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MA Prospects for Growth

As an integrated risk assessment business, MA helps customers build resilience by providing tools to measure the financial implications of risk and capitalize on related opportunities. Growth in MA is likely to be driven by expansion across customer sectors fostered by broadening MA's data and analytics solutions to meet an expanded set of customer use cases.

MA’s business growth is influenced by a number of factors, including:

Growth from data and analytics in adjacent markets, including KYC, CRE and ESG			Expansion of data sets and delivery options establishing a gateway that supports multiple stakeholders			Alignment of product strategy to develop and deliver integrated risk solutions			Enhancement of architecture for engineering and data strategies (e.g., SaaS, API, data infrastructure, operational resilience and IT controls)			Geographic expansion of actuarial and asset management solutions and continued investment in predictive analytics franchise			Expanded sales capacity to drive new initiatives and continue to deliver on targets			Enhancement of customer engagement and innovation through understanding the customers' view on value

Moody’s expects that MA products and services that improve efficiencies, provide business insights, and enable compliance with financial regulation, including AML, KYC, and accounting standards, will continue to be in demand from institutions worldwide. To respond to other sources of demand and drive growth, MA is actively investing in new products, enhanced data sets and improved delivery services (e.g., software-as-a-service). These efforts should support broader distribution of MA’s capabilities, deepen relationships with existing customers and drive new customer acquisition.

COMPETITION

MIS competes with other CRAs and with investment banks and brokerage firms that offer credit opinions and research. Many users of MIS’s ratings also have in-house credit research capabilities. There are also some rating markets, based on industry, geography and/or instrument type, in which Moody’s has made investments and obtained market positions superior to its competitors, while in other markets, the reverse is true.

MA competes broadly in the financial information industry against various diversified competitors. MA’s main competitors within RD&A are providers of fixed income analytics, valuations, economic data and research as well as a host of financial training and education firms. In ERS, MA faces competition from both large software providers and various other vendors as well as in-house solutions.

REGULATION

MIS, certain of the Company's credit rating affiliates and many of the issuers and/or securities that MIS and the affiliates rate, are subject to extensive regulation in the U.S., EU and in other countries (including by state and local authorities). In addition, some of the services offered by MA and its affiliates are subject to regulation in a number of countries. MA also derives a significant amount of its sales from banks and other financial services providers who are subject to regulatory oversight and who are required to pass through certain regulatory requirements to key suppliers such as MA. Existing and proposed laws and regulations can impact the Company’s operations, products and the markets in which the Company operates. Additional laws and regulations have been proposed or are being considered. Each of the existing, adopted, proposed and potential laws and regulations can increase the costs and legal risk associated with the Company’s operations, including the issuance of credit ratings, and may negatively impact the Company’s profitability and ability to compete, or result in changes in the demand for the Company's products and services, in the manner in which the Company's products and services are utilized and in the manner in which the Company operates.

The regulatory landscape continues to evolve. In the U.S., CRAs are subject to extensive regulation primarily pursuant to the Reform Act and the Dodd-Frank Act. The Reform Act added Section 15E to the Exchange Act and provided the SEC with the authority to establish a registration and oversight program for CRAs registered as NRSROs. The Dodd-Frank Act added additional provisions to Section 15E. The transitions of the Presidential administration, Congress and SEC, in the U.S., as with any such government transition, could bring potential changes in the laws affecting CRAs and/or the enforcement of any new or existing legislation, regulation or directives by government authorities.

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In the EU, the CRA industry is registered and supervised through a pan-EU regulatory framework. ESMA has direct supervisory responsibility for registered CRAs throughout the EU. MIS’s EU CRA subsidiaries are registered and are subject to formal regulation and periodic inspection. From time to time, ESMA publishes interpretive guidance, or thematic reports regarding various aspects of the CRA regulation and, annually, sets out its work program for the forthcoming year. In July 2021, the Commission announced further measures in respect of its sustainable finance strategy. These include further assessments in respect of both CRAs and sustainability ratings and research, which might lead to legislative action.

On December 31, 2020, the MIS U.K. registered CRA ceased to be registered with and regulated by ESMA and became subject to regulation by the U.K. Financial Conduct Authority (FCA). Regulatory arrangements also came into effect in both the U.K. and the EU to allow credit ratings to be available for regulatory use in both the EU and the U.K. MIS has put arrangements in place to endorse its U.K. credit ratings into the EU and its EU credit ratings into the U.K. The U.K. Government is considering bringing ESG data and ratings firms within the scope of FCA authorization and regulation.

In light of the regulations that have gone into effect in both the EU and the U.S. (as well as many other countries), periodically and as a matter of course pursuant to their enabling legislation, regulatory authorities have, and will continue to, publish reports that describe their oversight activities. In addition, other legislation, regulation and/or interpretation of existing regulation relating to the Company’s operations, including credit rating, ancillary and research services has been or is being considered by local, national and multinational bodies and this type of activity is likely to continue in the future. Finally, in certain countries, governments may provide financial or other support to locally-based CRAs. If enacted, any such legislation and regulation could change the competitive landscape in which the Company operates. The legal status of CRAs has been addressed by courts in various jurisdictions and is likely to be considered and addressed in legal proceedings from time to time in the future. Management of the Company cannot predict whether these or any other proposals will be enacted, the outcome of any pending or possible future legal proceedings, or regulatory or legislative actions, or the ultimate impact of any such matters on the competitive position, financial position or results of operations of the Company.

INTELLECTUAL PROPERTY

Moody’s and its affiliates own and control a variety of intellectual property, including but not limited to:

						Proprietary information									Publications									Databases
						Trademarks									Software tools and applications									Domain names
						Research									Models and methodologies									Other proprietary materials that, in the aggregate, are of material importance to Moody’s business

Management of Moody’s believes that each of the trademarks and related corporate names, marks and logos relating to its businesses, including those containing the term “Moody’s”, are of material importance to the Company.

The Company, primarily through MA and its subsidiaries, licenses certain of its databases, software applications, credit risk models, training courses in credit risk and capital markets, research and other publications and services that contain intellectual property to its customers. In addition, the Company licenses certain databases, software applications, assessments, research and other publications and services relating to ESG and climate risks that contain intellectual property to its customers. These licenses are provided pursuant to standard agreements containing customary restrictions and intellectual property protections.

In addition, Moody’s licenses from third parties certain technology, data and other intellectual property rights. Specifically, Moody’s obtains licenses from third parties to use financial information (such as market and index data, financial statement data, research data, default data, and security identifiers) as well as software development tools and libraries. In addition, certain of the Company’s subsidiaries obtain from third party information providers certain financial, credit risk, compliance, management, ownership, news and/or other data worldwide, which are distributed through certain of Moody's information products. The Company obtains such technology and intellectual property rights from generally available commercial sources. The Company also utilizes generally available open source software and libraries for internal use and subject to appropriately permissive open source licenses, to carry out routine functions in certain of the Company’s software products. Most of such technology and intellectual property is available from a variety of sources. Although certain financial information (particularly security identifiers, certain pricing or index data, and certain company financial data in selected geographic markets) is available from a limited number of sources, Moody’s does not believe it is dependent on any one data source for a material aspect of its business.

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The names of Moody’s products and services referred to herein are trademarks, service marks or registered trademarks or service marks owned by or licensed to Moody’s or one or more of its affiliates. The Company owns seventy-five patents (including granted, allowed and pending patents). None of the Company's intellectual property is subject to a specific expiration date, except to the extent that the patents and the copyright in items that the Company creates (such as credit reports, research, software, and other written opinions) expire pursuant to relevant law.

The Company considers its intellectual property to be proprietary, and Moody’s relies on a combination of copyright, trademark, trade secret, patent, non-disclosure and other contractual and technological safeguards for protection. Moody’s also pursues instances of third-party infringement of its intellectual property in order to protect the Company’s rights.

AVAILABLE INFORMATION

Moody’s investor relations internet website is https://ir.moodys.com/. Under the “SEC Filings” tab at this website, the Company makes available free of charge its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports as soon as reasonably practicable after they are filed with, or furnished to, the SEC.

The SEC maintains an internet site that contains annual, quarterly and current reports, proxy and other information statements that the Company files electronically with the SEC. The SEC’s internet site is https://www.sec.gov/.

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

						Name, Age, Position and Biographical Data
						Robert Fauber, 51 President and Chief Executive Officer Mr. Fauber has served as the Company’s President and Chief Executive Officer since January 2021. Mr. Fauber joined the Board of Directors in October 2020 and he currently serves on the Executive Committee of the Board of Directors. Prior to serving as CEO, Mr. Fauber served as Chief Operating Officer from November 2019 to December 2020, as President of Moody’s Investors Service, Inc. from June 2016 to October 2019, as Senior Vice President—Corporate & Commercial Development of Moody’s Corporation from April 2014 to May 2016, and was Head of the MIS Commercial Group from January 2013 to May 2016. From April 2009 through April 2014, he served as Senior Vice President—Corporate Development of Moody’s Corporation. Mr. Fauber served as Vice President—Corporate Development from September 2005 to April 2009. Prior to joining Moody’s, Mr. Fauber served in several roles at Citigroup and its investment banking subsidiary.
						John J. Goggins, 61 Executive Vice President and General Counsel Mr. Goggins has served as the Company’s Executive Vice President and General Counsel since April 2011 and the Company’s Senior Vice President and General Counsel from October 2000 until April 2011. Mr. Goggins joined Moody’s Investors Service, Inc. in February 1999 as Vice President and Associate General Counsel.
						Mark Kaye, 42 Executive Vice President and Chief Financial Officer Mr. Kaye has served as the Company’s Executive Vice President—Chief Financial Officer since April 2021 and as Senior Vice President—Chief Financial Officer from August 2018 to April 2021. Prior to joining the Company, Mr. Kaye was Senior Vice President and Head of Financial Planning and Analysis at Massachusetts Mutual Life Insurance Company (MassMutual) since February 2016, and Chief Financial Officer of MassMutual U.S. since July 2015. Prior to that, Mr. Kaye served as Chief Financial Officer and Senior Vice President, Retirement Solutions, at Voya Financial from 2011 to 2015. Mr. Kaye previously held various senior financial and risk reporting positions at ING U.S. and ING Group, and was in the investment banking division of Credit Suisse First Boston.

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						Name, Age, Position and Biographical Data
						Caroline Sullivan, 53 Senior Vice President and Corporate Controller Ms. Sullivan has served as the Company’s Senior Vice President and Corporate Controller since December 2018. Prior to joining the Company, Ms. Sullivan served in several roles at Bank of America from 2011 to 2018, where her last position held was Managing Director and Global Banking Controller. Prior to that role, Ms. Sullivan supported the Global Wealth & Investment Management business from 2015 to 2017 in a variety of positions including Controller. Ms. Sullivan, a CPA, previously held various senior positions at several banks and a major accounting firm, and is a member of the Board of Directors of Financial Executives International.
						Stephen Tulenko, 54 President, Moody’s Analytics Mr. Tulenko has served as President of Moody’s Analytics since November 2019. Mr. Tulenko served as Executive Director of Enterprise Risk Solutions from 2013 to October 2019 and as Executive Director of Global Sales, Customer Service and Marketing from 2008 to 2013. Prior to the formation of Moody’s Analytics, he held various sales, product development and product strategy roles at Moody’s Investors Service, Inc. Mr. Tulenko joined Moody’s in 1990.
						Michael West, 53 President, Moody’s Investors Service Mr. West has served as President of Moody’s Investors Service, Inc. since November 2019. Mr. West served as Managing Director—Head of MIS Ratings and Research from June 2016 to October 2019. Previously, Mr. West served as Managing Director—Head of Global Structured Finance from February 2014 to May 2016 and Managing Director—Head of Global Corporate Finance from January 2010 to January 2014. Earlier in his career, he was also responsible for the research strategy for the ratings businesses and before that led Corporate Finance for the EMEA Region, European Corporates and the EMEA leveraged finance business. Prior to joining Moody’s in 1998, Mr. West worked at Bank of America and HSBC in various credit roles.

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