Over the next decade, the probability and materiality of climate-related risks is set to increase. Due to the short time scales on which MIS assesses risk, this climate reality is largely missing from its credit ratings. Of 8700 ratings actions taken last year, environmental, social and governance (ESG) risks were considered material in 85%; however, only 13% cited environmental factors.1 Presently MIS views credit ratings and ESG scores (Credit Impact Score and Issuer Profile Scores) as not necessarily linked,2 despite climate risks posing clear threats to issuer creditworthiness. In 2019 Moody’s downgraded PG&E unit Pacific Gas & Electric Co only after the wildfire that raged through California and led to the utility’s bankruptcy.3 Far from being a black swan event, PG&E’s exposure to wildfire risk had been increasing for 20 plus years due to climate conditions.4 This focus on ex-post ratings action (including issuing a ratings upgrade prior to 201T’s wildfire season) exposes the flaws of MIS’s approach to climate risk. Time horizons for climate-change stress testing need to cover a longer time duration to reflect the horizons over which climate change risk factors are expected to fully materialize. Moody’s acquisition of RMS and other such platforms gives it industry-leading capability to undertake such assessments. A 2017 UN Principles for Responsible Investment report recommends that rating agencies include scenario analysis to address long-term [ESG] trends and risk trajectories.5 It’s now 2021, and Moody’s is still not addressing long term trends and risk trajectories in issuer ratings. The Bank of International Settlements states that the materialisation of increasingly severe physical risks and/ or of transition risk is currently advancing into the typical window of bank and supervisory risk measurement and, notably, is already likely to occur within the maturities of longer-dated positions.6 The Task Force on ClimateRelated Financial Disclosures also recommended that investors reconsider their short-term outlook, and other experts warn limiting risk analysis to shorter timeframes may underestimate the exposure.7 Moody’s Analytics already implements current best practices to discretize the continuous distribution of possible economic and climate futures into representative climate scenarios, representing a long period of time (typically, to the year 2100). Therefore, we ask the Board to report on the feasibility of increasing the period of assessment to greater than five years when considering climate risk in issuer credit ratings.