Disclosure and transparency, the quest of accuracy in the sovereign ratings

One solution for agencies to dissipate part of the criticism they are subjected to is by being more transparent. Transparency of the sovereign credit rating system is the way to foster a culture of trust between sovereign issuers and CRAs. When kept in the loop and understanding how their ratings are produced, sovereign issuers are more likely to put their trust in agencies. Conversely, those kept in the dark may feel suspicious about agencies and their ratings and will find it difficult to trust them, as a lack of transparency is likely to lead to a lack of trust. Previous chapters have shown a number of limitations in agencies’ process of assessing sovereign creditworthiness.