All rating decisions are taken by Committees and not by individuals. Rating Committees are forums where the rating analysts present their study of the case with relevant facts and figures in support of the rating recommended by them. The Committee then critically evaluates the rating proposal and arrives at an unbiased and independent rating decision either by unanimous agreement of all members present or by way of majority members agreeing to the rating decision.
BWR has multiple Rating Committees to deal with debts of different types, size and complexity
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Eligibility for becoming Committee members
Senior finance professionals working in the rating division of Brickwork Ratings (BWR) with a minimum of 5 years’ experience in domains of banking / finance / industry or company analysis with high analytical skills are eligible to be a member of the Rating Committee.
BWR has independent members, who are eminent persons having high level of experience in the fields of Finance, Banking, Management, etc. as part of the Appeal Committee. These members shall not derive any pecuniary interest from the Rating Agency.
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Composition of Committee/Other Committee
The composition of the BWR’s Rating Committee is available here The members of a particular Committee are drawn from the Rating Committee members in consultation with the CRO. The composition of BWR’s Rating Committee may be revised from time to time in consultation with the CRO
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Minimum quorum required
All Committees, except those that deal with financial instruments of high complexity, have a minimum quorum of three members. Committees that deal with financial instruments of high complexity have a minimum quorum of 4 members.
The Rating Committee dealing with appeals by issuers shall consist of minimum quorum of 3 members, out of whom one will be an independent member, and two of the members (majority) should not have been part of the previous rating decision, in line with the requirements of SEBI circular SEBI/HO/MIRSD/DOS3/CIR/P/2018/130.
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Duties of Committee Members
The Rating Committee members are expected to critically evaluate the rating proposal, be unbiased, exercise appropriate judgement and take an independent view to arrive at an appropriate and deserving rating to the financial instrument being evaluated.
During the rating process, each Rating Committee member shall:
- Keep himself / herself informed of the rating criteria, policies, regulatory guidelines, prevailing financial market environment.
- Point out deficiencies, if any, in the presentation of the case and may seek additional information and ensure a well informed decision is taken by the Committee.
- Ensure that the rating process adopted is in line with the internal operations manual of BWR.
- Disclose if he/she has any conflict of interest in respect of any case being taken up for discussion in the Committee’s agenda. The member must recuse from participating in the meeting relating to that case.
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System of voting and recording of dissent.
Before commencing the agenda in the Rating Committee, the Chairperson of the committee will record the attendance of eligible members and ensure requirement of quorum is met. The Chairperson shall ensure compliance with aspects of conflict of interest before taking up the subject.
- Each member of the rating committee including the Chairperson has a vote.
- The rating committee decisions are recorded either after arriving at them unanimously or by majority votes being cast in favour of the decision taken. In the event of there being an equal division when members vote, the Chairman shall exercise casting vote.
- The dissent, if any, expressed by any member/members shall be recorded along with the names of the dissenting member/s and the reasons for dissent.
The Chairman shall ensure that proceedings in the meeting are appropriately captured in the minutes.
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Managing conflict of interest in the Rating Committee/Other Committee.
The Chairperson will call the meeting to order and confirm if any one present has conflict of interest before taking up any agenda in the rating committee.
Any member / participant who has any conflict of interest in the subject to be taken up, shall disclose the nature of his interest and recuse himself from participating in the meeting.
Accordingly, the Chairman shall ensure that conflict of interest, if any, is appropriately captured in the minutes.