Credit rating of the company
The main elements of the methodology for assigning credit rating of RA RFCA are:
- Industry Analysis
- Business analysis
- Financial analysis
- Management analysis
The credit rating of the company is a combination of qualitative (industry and business risks) and quantitative (financial risk) analyses. Both analyses are equally important.
In rating assignment RA RFCA applies macro to micro approach. It means that at first there is analyzed the industry, in which the company operates, then – the business, which company leads in this industry, and after that – the analysis of financial indicators and of the company’s management is performed. Thus, a clear understanding of business risks of the company provides a platform for understanding of financial risks, i.e. to understand how high are the indicators, it is necessary to understand the nature of business.
Corporate Governance Rating
Corporate Governance rating is a holistic assessment, consisting of the following categories:
- Ownership structure and influence of shareholders – shareholders’ rights, implying the realization of the voting right, right to receive dividends, to receive and evaluate information; general meeting of shareholders: its organization, functioning and conduction of post – organizational measures.
- Disclosure and transparency – disclosure methods including Web site and annual report; the procedure of information disclosure, describing company’s information policy in terms of accessibility and quality of information.
- Financial stakeholders – employee participation in company management; the company’s policy in terms of relationships with financial stakeholders; company employees and social responsibility of the business.
- Board of Directors – the activities and functioning of the Board of Directors, Committees of the Board of Directors, management system of internal control and risk management.
- The executive body – the basics of activities, structure and remuneration system of the executive body.