UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(MARK ONE)

☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED December 31, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM            TO            .

COMMISSION FILE NUMBER 1-14037

MOODY’S CORPORATION

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

Delaware	13-3998945
(STATE OF INCORPORATION)	(I.R.S. EMPLOYER IDENTIFICATION NO.)

7 World Trade Center at 250 Greenwich Street, New York, New York 10007

(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

(ZIP CODE)

REGISTRANT’S TELEPHONE NUMBER, INCLUDING AREA CODE: (212) 553-0300.

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

TITLE OF EACH CLASS	TRADING SYMBOL(S)	NAME OF EACH EXCHANGE ON WHICH REGISTERED
Common Stock, par value $0.01 per share	MCO	New York Stock Exchange
1.75% Senior Notes Due 2027	MCO 27	New York Stock Exchange
0.950% Senior Notes Due 2030	MCO 30	New York Stock Exchange

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

NONE

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☑ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ☐  No ☑

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ☑  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes ☑  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer  ☑ Accelerated Filer ☐ Non-accelerated Filer ☐ Smaller reporting company ☐ Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes ☐  No ☑

The aggregate market value of Moody’s Corporation Common Stock held by nonaffiliates* on June 30, 2021 (based upon its closing transaction price on the New York Stock Exchange on such date) was approximately $68 billion.

As of January 31, 2022, 185.2 million shares of Common Stock of Moody’s Corporation were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant’s definitive proxy statement for use in connection with its annual meeting of stockholders scheduled to be held on April 26, 2022, are incorporated by reference into Part III of this Form 10-K.

The Index to Exhibits is included as Part IV, Item 15(3) of this Form 10-K.

*Calculated by excluding all shares held by executive officers and directors of the Registrant without conceding that all such persons are “affiliates” of the Registrant for purposes of federal securities laws.

*

Auditor Name: KPMG LLP Auditor Location: New York, NY Auditor Firm ID: 185

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MOODY’S CORPORATION

INDEX TO FORM 10-K

		Page(s)
	Glossary of Terms and Abbreviations	4-10
PART I.
Item 1.	BUSINESS	11
	Background	11
	The Company	11-14
	Human Capital	14-18
	Climate	18
	Moody’s Strategy	19-20
	Prospects for Growth	21-23
	Competition	23
	Regulation	23-24
	Intellectual Property	24-25
	Available Information	25
	Executive Officers of the Registrant	25-26
Item 1A.	RISK FACTORS	27-37
Item 1B.	UNRESOLVED STAFF COMMENTS	38
Item 2.	PROPERTIES	38
Item 3.	LEGAL PROCEEDINGS	38
Item 4.	MINE SAFETY DISCLOSURES	38
PART II.
Item 5.	MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	39
	Moody’s Purchases of Equity Securities	39
	Common Stock Information	39
	Equity Compensation Plan Information	39
	Performance Graph	40
Item 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	41
	The Company	41
	Critical Accounting Estimates	41-46
	Reportable Segments	46
	Results of Operations	46-59
	Market Risk	60-61
	Liquidity and Capital Resources	61-66
	Recently Issued Accounting Pronouncements	66
	Contingencies	66
	Forward-Looking Statements	66-67
Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	67
Item 8.	FINANCIAL STATEMENTS	68-129
Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	130

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		Page(s)
Item 9A.	CONTROLS AND PROCEDURES	130
Item 9B.	OTHER INFORMATION	130
Item 9C.	DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS	130
PART III.
Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	131
Item 11.	EXECUTIVE COMPENSATION	131
Item 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	131
Item 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	131
Item 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES	131
PART IV.
Item 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	132
INDEX TO EXHIBITS		132-135
Item 16.	FORM 10-K SUMMARY	135
SIGNATURES		136

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GLOSSARY OF TERMS AND ABBREVIATIONS

The following terms, abbreviations and acronyms are used to identify frequently used terms in this report:

TERM	DEFINITION
Acquire Media (AM)	An aggregator and distributor of curated real-time news, multimedia, data, and alerts; acquired by the Company on October 21, 2020
Acquisition-Related Amortization	Amortization of definite-lived intangible assets acquired by the Company from all business combination transactions
Acquisition-Related Expenses	Consists of expenses incurred over a multi-year period to complete and integrate the acquisition of Bureau van Dijk
Adjusted Diluted EPS	Diluted EPS excluding the impact of certain items as detailed in the section entitled “Non-GAAP Financial Measures”
Adjusted Net Income	Net Income excluding the impact of certain items as detailed in the section entitled “Non-GAAP Financial Measures”
Adjusted Operating Income	Operating income excluding the impact of certain items as detailed in the section entitled "Non-GAAP Financial Measures"
Adjusted Operating Margin	Adjusted Operating Income divided by revenue
Americas	Represents countries within North and South America, excluding the U.S.
AML	Anti-money laundering
AOCI(L)	Accumulated other comprehensive income (loss); a separate component of shareholders’ equity
ASC	The FASB Accounting Standards Codification; the sole source of authoritative GAAP as of July 1, 2009 except for rules and interpretive releases of the SEC, which are also sources of authoritative GAAP for SEC registrants
Asia-Pacific	Represents Australia and countries in Asia including but not limited to: China, India, Indonesia, Japan, Korea, Malaysia, Singapore, Sri Lanka and Thailand
ASR	Accelerated Share Repurchase
ASU	The FASB Accounting Standards Update to the ASC. It also provides background information for accounting guidance and the bases for conclusions on the changes in the ASC. ASUs are not considered authoritative until codified into the ASC
B&H	Barrie & Hibbert Limited, an acquisition completed in December 2011; part of the MA segment, a leading provider of risk management modeling tools for insurance companies worldwide
Board	The board of directors of the Company
BPS	Basis points
Brexit	The withdrawal of the United Kingdom from the European Union
Bureau van Dijk	Bureau van Dijk Electronic Publishing, B.V.; a global provider of business intelligence and company information; acquired by the Company on August 10, 2017 via the acquisition of Yellow Maple I B.V., an indirect parent of Bureau van Dijk; part of the RD&A LOB
BitSight	A provider of cybersecurity ratings, analytics, and performance management tools; Moody's acquired a minority investment in BitSight in 2021
Catylist	A provider of commercial real estate (CRE) solutions for brokers; acquired by the Company on December 30, 2020
CCXI	China Cheng Xin International Credit Rating Co. Ltd.; China’s first and largest domestic credit rating agency approved by the People’s Bank of China; the Company acquired a 49% interest in 2006; currently Moody’s owns 30% of CCXI
CDP	A not-for-profit charity that runs the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts

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TERM	DEFINITION
CFG	Corporate finance group; an LOB of MIS
CLO	Collateralized loan obligation
CMBS	Commercial mortgage-backed securities; an asset class within SFG
COLI	Corporate-Owned Life Insurance
Commission	European Commission
Common Stock	The Company’s common stock
Company	Moody’s Corporation and its subsidiaries; MCO; Moody’s
Content	Prior to the second quarter of 2021, was a reporting unit within the MA segment that offered subscription-based research, data and analytical products, including credit ratings produced by MIS, credit research, quantitative credit scores and other analytical tools, economic research and forecasts
Cortera	A provider of North American credit data and workflow solutions; acquired by the Company in March 2021
COVID-19	An outbreak of a novel strain of coronavirus resulting in an international public health crisis and a global pandemic
CP	Commercial Paper
CP Notes	Unsecured commercial paper issued under the CP Program
CP Program	A program entered into on August 3, 2016 allowing the Company to privately place CP up to a maximum of $1 billion for which the maturity may not exceed 397 days from the date of issue, and which is backstopped by the 2021 Facility.
CRAs	Credit rating agencies
CRE	Commercial Real Estate
DBPPs	Defined benefit pension plans
Dodd-Frank Act	Dodd-Frank Wall Street Reform and Consumer Protection Act
EBITDA	Earnings before interest, taxes, depreciation and amortization
EEO-1	Data filing required by the U.S. Equal Employment Opportunity Commission that requires all private sector employers with 100 or more employees, and federal contractors with 50 or more employees meeting certain criteria, to submit demographic workforce data, including data by race/ethnicity, sex and job categories
EMEA	Represents countries within Europe, the Middle East and Africa
EPS	Earnings per share
ERS	Enterprise Risk Solutions; an LOB within MA, which offers risk management software solutions as well as related risk management advisory engagements services
ESA	Economics and Structured Analytics; part of the RD&A line of business within MA
ESG	Environmental, Social and Governance
ESMA	European Securities and Markets Authority
ESPP	Employee stock purchase plan
ETR	Effective tax rate
EU	European Union
EUR	Euros
EURIBOR	The Euro Interbank Offered Rate
Eurozone	Monetary union of the EU member states which have adopted the euro as their common currency

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TERM	DEFINITION
Excess Tax Benefits	The difference between the tax benefit realized at exercise of an option or delivery of a restricted share and the tax benefit recorded at the time the option or restricted share is expensed under GAAP
Exchange Act	The Securities Exchange Act of 1934, as amended
External Revenue	Revenue excluding any intersegment amounts
FASB	Financial Accounting Standards Board
Fermat	Fermat International; an acquisition completed in October 2008; part of the MA segment; a provider of risk and performance management software to the global banking industry
FIG	Financial institutions group; an LOB of MIS
Four Twenty Seven	A provider of data, intelligence, and analysis related to physical climate risks; acquired by the Company in July 2019
Free Cash Flow	Net cash provided by operating activities less cash paid for capital additions
FTSE	Financial Times Stock Exchange
FX	Foreign exchange
GAAP	U.S. Generally Accepted Accounting Principles
GBP	British pounds
GDP	Gross domestic product
GDPR	European Union’s General Data Protection Regulation
ICRA	ICRA Limited; a provider of credit ratings and research in India.
INR	Indian National Rupee
IRS	Internal Revenue Service
KIS	Korea Investors Service, Inc.; a Korean rating agency and consolidated subsidiary of the Company
KIS Pricing	Korea Investors Service Pricing, Inc.; a Korean provider of fixed income securities pricing and consolidated subsidiary of the Company
KIS Research	Korea Investors Service Research; a Korean provider of financial research and consolidated subsidiary of the Company
Korea	Republic of South Korea
KYC	Know-your-customer
LIBOR	London Interbank Offered Rate
LOB	Line of business
MA	Moody’s Analytics—a reportable segment of MCO; a global provider of: i) data and information; ii) research and insights; and iii) decision solutions, which help companies make better and faster decisions; consists of two LOBs—RD&A and ERS
Make Whole Amount	The prepayment penalty amount relating to certain Senior Notes, which is a premium based on the excess, if any, of the discounted value of the remaining scheduled payments over the prepaid principal
MAKS	Moody’s Analytics Knowledge Services; formerly known as Copal Amba; provided offshore research and analytic services to the global financial and corporate sectors; business was divested in the fourth quarter of 2019 and was formerly part of the PS LOB and a reporting unit within the MA reportable segment.
MALS	Moody’s Analytics Learning Solutions; prior to the second quarter of 2021, was a reporting unit within the MA segment that offered on-line and classroom-based training services as well as credentialing and certification services
MCO	Moody’s; Moody’s Corporation and its subsidiaries; the Company

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TERM	DEFINITION
MD&A	Management’s Discussion and Analysis of Financial Condition and Results of Operations
MIS	Moody’s Investors Service—a reportable segment of MCO; consists of five LOBs—SFG, CFG, FIG, PPIF and MIS Other
MIS Other	Consists of non-ratings revenue from ICRA, KIS Pricing and KIS Research revenue as well as revenue from providing ESG research, data and assessments. These businesses are components of MIS; MIS Other is an LOB of MIS
Moody’s	Moody’s Corporation and its subsidiaries; MCO; the Company
Moody's Local	A ratings platform focused on providing credit rating services in local capital markets
MSS	Moody's Shared Services; primarily consists of information technology and support staff such as finance, human resources and legal that support both MIS and MA.
NAV	Net asset value
Net Income	Net income attributable to Moody’s Corporation, which excludes net income from consolidated noncontrolling interests belonging to the minority interest holder
New Credit Losses Accounting Standard	Updates to the ASC pursuant to ASU No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. This new accounting guidance requires the use of an “expected credit loss” impairment model for most financial assets reported at amortized cost, which requires entities to estimate expected credit losses over the lifetime of the instrument.
New Lease Accounting Standard	Updates to the ASC pursuant to ASU No. 2016-02, “Leases (ASC Topic 842)”. This new accounting guidance requires lessees to recognize a right-of-use asset and lease liability on the balance sheet for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses and cash flows depend on classification as either a finance or operating lease
NM	Percentage change is not meaningful
Non-GAAP	A financial measure not in accordance with GAAP; these measures, when read in conjunction with the Company’s reported results, can provide useful supplemental information for investors analyzing period-to-period comparisons of the Company’s performance, facilitate comparisons to competitors’ operating results and to provide greater transparency to investors of supplemental information used by management in its financial and operational decision making
NRSRO	Nationally Recognized Statistical Rating Organization, which is a credit rating agency registered with the SEC.
OCI	Other comprehensive income (loss); includes gains and losses on cash flow and net investment hedges, certain gains and losses relating to pension and other retirement benefit obligations and foreign currency translation adjustments
Operating segment	Term defined in the ASC relating to segment reporting; the ASC defines an operating segment as a component of a business entity that has each of the three following characteristics: i) the component engages in business activities from which it may recognize revenue and incur expenses; ii) the operating results of the component are regularly reviewed by the entity’s chief operating decision maker; and iii) discrete financial information about the component is available.
Other Retirement Plans	The U.S. retirement healthcare and U.S. retirement life insurance plans
PassFort	A U.K. SaaS-based workflow platform for identity verification, customer onboarding, and risk analysis; acquired by the Company on November 30, 2021.
PCS	Post-Contract Customer Support
PPIF	Public, project and infrastructure finance; an LOB of MIS
Profit Participation Plan	Defined contribution profit participation plan that covers substantially all U.S. employees of the Company

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TERM	DEFINITION
PS	Professional Services, a former LOB within MA which consisted of MAKS and MALS that provided offshore analytical and research services as well as learning solutions and certification programs. Subsequent to the divestiture of MAKS in 2019, revenue from the MALS reporting unit, which previous to 2020 was reported in the PS LOB, is now reported as part of the RD&A LOB. Prior periods have not been reclassified as the amounts were not material.
RealXData	A provider of CRE lease-level portfolio management with benchmarking and rent forecasting capabilities; acquired by the Company in September 2021
RD&A	Research, Data and Analytics; an LOB within MA that offers: subscription based research, data and analytical products, including credit ratings produced by MIS; credit research; quantitative credit scores and other analytical tools; economic research and forecasts; business intelligence and company information products; commercial real estate data and analytical tools; and on-line and classroom-based training services as well as credentialing and certification services
Recurring Revenue	For MIS, represents recurring monitoring fees of a rated debt obligation and/or entities that issue such obligations, as well as revenue from programs such as commercial paper, medium-term notes and shelf registrations. For MIS Other represents subscription-based revenue. For MA, represents subscription-based revenue and software maintenance revenue
Reform Act	Credit Rating Agency Reform Act of 2006
Regulatory Data Corporation (RDC)	A provider of anti-money laundering (AML) and know-your-customer (KYC) data and due diligence services; the Company acquired RDC in February 2020
REIT	Real Estate Investment Trust
Reis, Inc. (Reis)	A provider of U.S. commercial real estate (CRE) data; acquired by the Company in October 2018; part of the RD&A LOB and prior to the second quarter of 2021 a reporting unit within the MA reportable segment.
Reporting unit	The level at which Moody’s evaluates its goodwill for impairment under U.S. GAAP; defined as an operating segment or one level below an operating segment
Retirement Plans	Moody’s funded and unfunded pension plans, the healthcare plans and life insurance plans
Revenue Accounting Standard	Updates to the ASC pursuant to ASU No. 2014-09, “Revenue from Contracts with Customers (ASC Topic 606)”. This accounting guidance significantly changed the accounting framework under U.S. GAAP relating to revenue recognition and to the accounting for the deferral of incremental costs of obtaining or fulfilling a contract with a customer
RMBS	Residential mortgage-backed securities; an asset class within SFG
RMS	A global provider of climate and natural disaster risk modeling and analytics; acquired by the Company in September 2021
ROU Asset	Assets recorded pursuant to the New Lease Accounting Standard which represent the Company’s right to use an underlying asset for the term of a lease
SaaS	Software-as-a-Service
SEC	U.S. Securities and Exchange Commission
Securities Act	Securities Act of 1933, as amended
SFG	Structured finance group; an LOB of MIS
SG&A	Selling, general and administrative expenses
SOFR	Secured Overnight Financing Rate
SSP	Standalone selling price
T&M	Time-and-Material
Tax Act	The “Tax Cuts and Jobs Act” enacted into U.S. law on December 22, 2017, which significantly amends the tax code in the U.S.
TCFD	Task Force on Climate-Related Financial Disclosures

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TERM	DEFINITION
Total Debt	All indebtedness of the Company as reflected on the consolidated balance sheets
Transaction Revenue	For MIS, represents the initial rating of a new debt issuance as well as other one-time fees. For MIS Other, represents revenue from professional services as well as data services, research and analytical engagements. For MA, represents perpetual software license fees and revenue from software implementation services, risk management advisory projects, training and certification services, and research and analytical engagements
U.K.	United Kingdom
U.S.	United States
USD	U.S. dollar
UTPs	Uncertain tax positions
Vigeo Eiris (VE)	A provider of ESG research, data and assessments; acquired by the Company in April 2019
VisibleRisk	A cyber risk ratings joint venture created by Moody’s and Team8, a global venture group
WACC	Weighted Average Cost of Capital
ZM Financial Systems (ZMFS)	A provider of risk and financial management software for the U.S. banking sector; acquired by the Company in December 2020
2018 Restructuring Program	Restructuring program approved by the chief executive officer of Moody’s on October 26, 2018. This program included relocation of certain functions from high-cost to lower-cost jurisdictions, a reduction of staff, including from acquisitions and pursuant to a review of the business criticality of certain positions, and the rationalization and exit of certain real estate leases due to consolidation of various business activities.
2020 MA Strategic Reorganization Restructuring Program	Restructuring program approved by the chief executive officer of Moody’s on December 22, 2020, relating to a strategic reorganization in the MA reportable segment.
2020 Real Estate Rationalization Restructuring Program	Restructuring program approved by the chief executive officer of Moody’s on July 29, 2020, primarily in response to the COVID-19 pandemic which revolves around the rationalization and exit of certain real estate leases.
2012 Senior Notes Due 2022	Principal amount of $500 million, 4.50% senior unsecured notes due in September 2022, but early repaid by the Company in 2021
2013 Senior Notes Due 2024	Principal amount of $500 million, 4.875% senior unsecured notes due in February 2024
2014 Senior Notes Due 2044	Principal amount of $600 million, 5.25% senior unsecured notes due in July 2044
2015 Senior Notes Due 2027	Principal amount of €500 million, 1.75% senior unsecured notes due in March 2027
2017 Senior Notes Due 2023	Principal amount of $500 million, 2.625% senior unsecured notes due January 15, 2023
2017 Senior Notes Due 2028	Principal amount of $500 million, 3.25% senior unsecured notes due January 15, 2028
2018 Facility	Five-year unsecured revolving credit facility, with capacity to borrow up to $1 billion; backstops CP issued under the CP Program. The 2021 Facility replaces the Company's $1 billion 2018 Credit Facility.
2018 Senior Notes Due 2029	Principal amount of $400 million, 4.25% senior unsecured notes due February 1, 2029
2018 Senior Notes Due 2048	Principal amount of $400 million, 4.875% senior unsecured notes due December 17, 2048
2019 Senior Notes Due 2030	Principal amount of €750 million, 0.950% senior unsecured notes due February 25, 2030

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TERM	DEFINITION
2020 Senior Notes Due 2025	Principal amount of $700 million, 3.75% senior unsecured notes due March 24, 2025
2020 Senior Notes Due 2050	Principal amount of $300 million, 3.25% senior unsecured notes due May 20, 2050
2020 Senior Notes Due 2060	Principal amount of $500 million, 2.55% senior unsecured notes due August 18, 2060
2021 Facility	Five-year unsecured revolving credit facility, with capacity to borrow up to $1.25 billion; backstops CP issued under the CP Program.
2021 Senior Notes Due 2031	Principal amount of $600 million, 2.00% senior unsecured notes due August 19, 2031
2021 Senior Notes Due 2041	Principal amount of $600 million, 2.75% senior unsecured notes due August 19, 2041
2021 Senior Notes Due 2061	Principal amount of $500 million, 3.10% senior unsecured notes due November 15, 2061
7WTC	The Company’s corporate headquarters located at 7 World Trade Center in New York, NY

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PART I

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