Stanford University’s law and business schools just completed a review of the various corporate governance rating firms, “which include the Corporate Library and RiskMetrics Group’s ISS Governance Services”, and conclude that their ratings on corporate governance have little to do with whether a company is actually well run.

This is not surprising. When we look at the credit rating firms such as S&P, Moody’s, etc. we see a very similar pattern.

A private ratings agency is always at risk from conflicts of interest.

^*Most commonly translated from the Latin as “Who Watches the Watchmen”.