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ESG disclosures
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Our Board of Directors oversees the company's management, strategy, and sustainability efforts. They set ethical standards for employees and leaders, regularly review sustainability initiatives, and adapt their approach as new sustainability risks and opportunities arise.
Together, the Board and its three committees oversee sustainability matters, including the incorporation of our sustainability strategy and approach to sustainability-related risks and opportunities.
Oversees sustainability-related disclosures made in Moody’s annual and quarterly reports. The committee also reviews reports by management regarding the adequacy and effectiveness of our internal controls and procedures related to sustainability disclosures.
Oversees sustainability matters as they pertain to Moody’s business and long-term value creation for our company and stockholders. The committee also makes recommendations to the Board regarding these issues.
Oversees the inclusion of sustainability-related performance goals for determining compensation of certain senior executives (including the Company’s Named Executive Officers).
Senior Management, which is composed of the Executive Leadership Team’s direct reports, is responsible for identifying and addressing risks and opportunities relating to sustainability and incorporating those items into their respective strategies.
Our Executive Leadership Team is accountable for achieving Moody’s sustainability goals. Therefore, sustainability-related performance metrics have been included as factors in certain senior executives' compensation since 2020. In 2021, these metrics were integrated into Moody’s Strategic and Operational (S&O) metrics which are used to determine annual cash incentive payments for senior executives. Since 2022, sustainability has been a core S&O focus for all eligible employees.
The Board is comprised of individuals with diverse expertise. Our Directors enhance their sustainability knowledge through continuous learning efforts and regular updates from the CEO and senior management. These include updates on the progress of our sustainability S&O metrics and various sustainability-related topics.
Gender diversity
Racial / ethnic diversity
All Directors, with the exception of the CEO, Rob Fauber, have been determined to be independent under the criteria defined in the New York Stock Exchange listing standards. For more information about the composition of our Board, see Moody’s 2024 Proxy Statement.
The Board oversees the implementation of risk management policies and processes. The Audit Committee supports our company in overseeing risk assessment and management processes. Our Enterprise Risk Management (ERM) function manages risk exposures and establishes a standard, organization-wide understanding of risk management based on the 2017 COSO framework. Our Managing Director of Risk Management is responsible for the ERM program, including management of risk exposure.
The Board provides oversight of management’s efforts to assess and manage cybersecurity risks and respond to cybersecurity incidents and threats. In addition, the Audit Committee regularly receives reports from management regarding Moody’s financial and compliance risks, including, but not limited to, risks relating to internal controls and cybersecurity risks. Moody’s has protocols by which certain cybersecurity concerns, incidents and threats are escalated within the company and, where appropriate, reported in a timely manner to the Board.
The Board annually reviews Moody’s risks and long-term strategic plan, both of which include climate-related matters, including business continuity disruptions and reputational risks. This involves the Board’s approval of Moody's Environmental Sustainability Policy and Decarbonization Plan.