The U.S. Securities Industry and Financial Markets Association Credit Rating Agency Task Force issued its recommendations for credit rating agency reform today.

The task force, comprised of 37 individuals from the United States, Europe, and Asia, including asset managers, underwriters, and issuers, focused on identifying the credit-rating-related causal variables that played a significant role in triggering the credit crisis of the past year. It notes that 16 key issues were identified, and ranked in order of importance. The recommendations address those issues that topped the list, including transparency, model quality, and surveillance.

In addition to enhancing disclosure of rating methodologies, due diligence information, surveillance procedures, credit rating agency performance, and fees, the recommendations also encourage a more harmonized and convergent global regulatory framework, and independent risk analyses by investors.

The task force also calls for industry members to assemble a group to provide expert input and advice on issues related to credit ratings to regulators, lawmakers, and other market participants. It recommends the creation of a global, independent industry Credit Ratings Advisory Board, under the auspices of SIFMA.

“The recommendations issued today endorse the development of a far more transparent credit rating system,” said Boyce Greer, president, Fixed Income and Asset Allocation at Fidelity and co-chair of the task force. “Specifically, these recommendations offer investors greater disclosure of the ratings process itself, and spur credit rating agencies to share more fully information they use in determining credit ratings. Investors’ ability to better understand the credit rating agency inputs and methodology will allow investors to incorporate ratings appropriately in their own internal risk assessments and investment decision analytics. This, in turn, is a key element of strengthening the securitized credit markets.”