S&P's CEO Sharma: 'We support these calls for accountability'

In a letter received by DailyFinance, Deven Sharma, president of Standard & Poor's, outlined how the ratings agency plans to change its practices in the wake of the massive global credit meltdown. Along with Moody's (MCO), S&P, a division of McGraw-Hill (MHP), has been blamed for enabling the housing boom and subsequent bust through lax ratings criteria, which led to many structured financial products receiving top-tier AAA ratings.

The S&P and Moody's traditionally reserved the AAA rating for companies with unparalleled financial strength. Many institutional investors are restricted from purchasing debt that does not receive the rating. The ratings agencies' granting the status to securitized mortgages created a huge pool of investor demand, because the AAA securities still carried higher yields than similar corporate bonds.