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Proposals by the International Organization of Securities Commission (IOSCO) to introduce a code of conduct for credit rating agencies (CRAs) are being welcomed by companies and professional associations alike, though with some reservations. The code of conduct comes in response to the major credit defaults of the last few years ? the most notable being Enron ? which have switched the governance spotlight on those rating agencies that failed to predict the defaults.

Three further banks have recently joined IBOS as associate members to offer services in their respective countries and to bring the IBOS service to their clients.

Over one third (38%) of British companies that have tried outsourcing claim it has been a complete failure or delivered fewer benefits than expected, reports a Gallup survey of 150 British businesses released today by Proudfoot Consulting.

Business conditions are set to improve over the next 12 months although the cost of borrowing and issuing debt will also rise, according to a survey carried out at the Association of Financial Professionals (AFP) annual conference in San Diego, US. Over 50% of finance professionals believe the re-election of George W. Bush will have a positive impact on business conditions in the US, 17% foresee a detrimental impact while 29% predict little change.

The Bond Market Association has welcomed the International Organisation of Securities Commissions' (IOSCO) initiative to develop code of conduct fundamentals for credit rating agencies, and has emphasised its support for self-regulatory measures, rather than detailed regulation, for these agencies.

The four corporate bond defaults during October were all US-based and amounted to $2.3 billion, the largest being the $1.3 billion default by Trump Atlantic City Associates. It is also the largest default this year and trumps the $1.25 billion default from the RCN Corporation. As a result, the global speculative-grade default rate for corporates has risen to 2.4% in November, its first rise since October 2003, according to Moody's. But not to worry, says the rating agency, which predicts it will fall back again to 2.3% by the end of the year before rising again in 2005.

Short-term rating downgrades to upgrades by commercial paper (CP) issuers have improved to 11 to one in 2003 from the historic peak reached in 2002 of 15 to one, the first year of improvement in the downgrade to upgrade ratio seen since 1999. What's more, the improving trend has continued through 2004 with only three downgrades for every upgrade registered from January to August in 2004. CP is popular with large corporates with high credit ratings to finance daily working capital management requirements with a typical maturity range from two to 270 days. Money market funds, banks, institutional investors and corporates are typical buyers of CP

The pre-eminence of the CFO in the company tax department is coming under threat as CEOs begin to take a keener interest in tax affairs due to corporate governance pressures, according to a survey by Ernst & Young. Of the 354 tax directors interviewed, more than half say they are seeing more direction coming from the CEO. And, while 62% of tax directors say their CFO is still responsible for tax decisions, 31% say that final policy and procedure approval are now in the hands, not of the CFO, but of the CEO and board.

Three-quarters of US and European multinationals use outsourcing or shared services to support their financial functions although less than half of them consider outsourcing to be cost effective, according to a recent PricewaterhouseCoopers' Management Barometer Survey. US corporates lie marginally ahead of their European counterparts in their willingness to outsource, with 77% compared to 72% outsourcing some portion of the finance function in the past two years. Outsourcing providers will also be cheered by news that 29% of US and European corporates expect to increase the level of outsourcing in their finance functions, with a concomitant rise in spending expected to be 16% above today's levels.

In a recent report that compares the quality of corporate ratings given in continental Europe and the US by Moody's, the rating agency, it is shown that ratings in continental Europe were found to be more accurate than their north American counterparts. The European ratings, according to the report, are more efficient in ranking default risk in absolute terms and relative to market-based credit measures, specifically in the one-year and three-year horizons.

Barclays Capital has appointed Christoph Cleve as a managing director and member of its board in Frankfurt, reporting to Rainer Stephan, chairman of the German board. Cleve joins a BarCap team that is expanding in an effort to increase its corporate finance coverage in the German market.

The planned reshuffle of the management structure at Royal Dutch/Shell, the multinational oil group which had until recently operated a dual management structure for the past century, has been hailed a success by S&P's Governance Services. Instead of two management entities ? one based in the UK, the other in the Netherlands ? Shell will create an ultimate parent company which will be incorporated in the UK and headquartered with tax residence in the Netherlands.