#12021 Stakeholder Sustainability Report Better decisions for a more resilient future MOODY'S#2A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report Table of Contents 03 A Message from Our President & CEO, Robert Fauber 04 05 20 39 2021 Sustainability Highlights About Moody's Moody's at a Glance About This Report Our Commitment to Sustainability Better Business Corporate Governance Ethics & Integrity Risk Management Climate Better Lives 74 Better Solutions 84 Appendix Diversity, Equity & Inclusion Employee Training & Upskilling Employee Health & Well-being ESG Solutions ESG Integration Communities Metric Summary Framework Index Glossary Additional Resources unding new CIANCE Stakeholder Sustainability Microsite 2021 TCFD Report MOODY'S Responsible Sourcing Cybersecurity & Data Privacy 2021 TCFD Report This is Moody's 2021 Stakeholder Sustainability Report, which covers the period from January 1 to December 31, 2021, except as noted otherwise. This report has been prepared in accordance with the Global Reporting Initiative (GRI) Standards: Core option, Value Reporting Foundation's Sustainability Accounting Standards Board (SASB) Standard for Professional and Commercial Services, and the World Economic Forum (WEF) International Business Council's Stakeholder Capitalism Metrics. Like the Moody's Annual Report, much of this document describes matters relating to Moody's Corporation and its consolidated subsidiaries. When referring to "we" or "Moody's," except where otherwise noted, this report refers to Moody's Corporation and its consolidated subsidiaries. Specific references to "Moody's Investors Service" and "Moody's Analytics" are examples of instances where the coverage diverges. In addition: (i) references to "the Board" refer to the Moody's Corporation Board of Directors, (ii) information and descriptions regarding Executive Compensation and Corporate Governance, like in the 2022 Proxy Statement, refer to Moody's Corporation and its executive officers, and (iii) information and descriptions relating to Ethics & Integrity, Risk Management, Climate, Responsible Sourcing, Cybersecurity & Data Privacy, Employee Training & Upskilling, Diversity, Equity & Inclusion, Employee Health & Well-being, Communities, ESG Solutions and ESG Integration, as well as our Sustainability Goals, are for Moody's Corporation and its consolidated subsidiaries, except where otherwise noted. All references to dollars are to U.S. dollars, unless otherwise stated, and "tonnes" refers to metric tons. Certain statements in this report are aspirational or otherwise forward-looking, and company goals are not guarantees or promises that all goals will be met. Actual results may differ materially from the company's expectations or predictions expressed in this report. Statistics, metrics and other performance measurements included in this report are estimates and may be based on assumptions or developing standards. Consistent with our holistic approach to sustainability, examples of products and services mentioned in this report include instances in which they have been provided for free, at a reduced cost and/or for a fee or cost. We welcome feedback and questions about this report. Please email us your queries at [email protected]. 2#3A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 3 A Message from Our President & CEO, Robert Fauber Our planet and society are at a pivotal moment. While climate change remains an existential risk, we face growing uncertainty from conflicts that may have seemed unimaginable not long ago. As the world grapples with these challenges, we at Moody's re-emphasize our commitment to supporting inclusive and sustainable economies and communities. As leaders in global integrated risk assessment, we are uniquely positioned to help the market make sense of sustainability. Our solutions help companies incorporate sustainability into their decisions and empower our customers to decode risk and unlock opportunities. Our new suite of climate solutions, for example, provides comprehensive measurement and evaluation tools that allow market participants to better understand, quantify and manage climate risks and opportunities. Sustainability is not only a value driver for Moody's. We strive to lead by example and are embedding responsible and sustainable decision-making across our firm. Last year, we accelerated our commitment to reach net-zero by 2040 - a decade earlier than the Paris Agreement goals. We are also working with our suppliers to help them advance their own sustainability targets. Most importantly, we're deeply invested in our people. We are proud to be widely recognized as a great place to work, and we continue to push ourselves to build a diverse workforce, compensate our employees equitably and fairly and support the well-being and professional development of our people through a wide range of impactful workplace programs. In our communities, we're engaged through employee-driven giving and volunteer programs, and we support our partners with grants and charitable contributions, including a recent initiative that double- matched employee donations to support Ukraine relief efforts. While we're proud of the achievements laid out in this report, we know we have to continue the momentum and do much more. Earlier this year we introduced sustainability as a core pillar of our corporate strategy. Other advances in 2022 include further strengthening our global employee benefits, offering Sustainability and ESG training to all of our employees and continuing to integrate and enhance our ESG solutions. We also look forward to working with the Net Zero Financial Services Provider Alliance as part of the Glasgow Financial Alliance for Net Zero (GFANZ) as we take the next steps towards aligning all our relevant products and services to achieve net-zero greenhouse gas emissions. I thank all of our employees, partners and customers for everything they do with us to build a Better Business, support Better Lives, and deliver Better Solutions. We look forward to continuing our work to make our business, financial markets and global communities more sustainable, inclusive and resilient. 队 Robert Fauber President & CEO, Moody's Corporation "As leaders in global integrated risk assessments, we are uniquely positioned to help the market make sense of sustainability."#4A MESSAGE FROM OUR 2021 SUSTAINABILITY PRESIDENT & CEO HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 2021 Sustainability Highlights BETTER BUSINESS We accelerated our work to embed responsible and sustainable decision-making into our business by: » Exceeding and progressing on our science-based targets: 92% reduction in absolute Scope 1 and Scope 2 GHG emissions from 2019 base year, compared with our target of 50% by 2030 » >>> » - 95% reduction in Scope 3 GHG emissions from fuel and energy-related activities, business travel and employee commuting from 2019 base year, compared with our target of 15% by 2025 28% of suppliers by spend covering purchased goods and services and capital goods have science-based targets, progressing to our target of 60% by 2025 Entering sustainability alliances, such as the Glasgow Financial Alliance for Net Zero (GFANZ) and the Taskforce on Nature-related Financial Disclosures (TNFD); More fully integrating sustainability-related performance metrics into annual compensation determination for all senior executives; and Updating our Environmental Sustainability and Privacy policies to reflect best practices. (888) BETTER LIVES We took steps to care for and equip our employees and to advance diversity, equity and inclusion (DE&I) in our business and our communities by: » >>> >>> >>> Committing to dedicating the resources necessary to maintain pay equity and to drive pay decisions based on legitimate factors. Our results show women earning $0.99 for every $1 earned by comparable men globally and non-white' employees earning $1.01 for every $1 earned by comparable white employees in the U.S.²; Evolving how we engage, empower and invest in diverse customers and underserved communities through our Creating Opportunities for Racial Equity (CORE) program; Aligning to a single performance management approach globally to empower employees to manage their professional development; and Engaging our communities through the donation of more than $6 million in Moody's Foundation grants, corporate charitable contributions, value of volunteer hours and employee-driven giving³. BETTER SOLUTIONS We continued to apply ESG best practices to the development of new solutions and the evolution of our legacy platforms and offerings by: » >>> Launching several new solutions that provide greater transparency into ESG-related risks or assist in aligning investments more closely with regulatory and disclosure frameworks, including: Expansion of our Issuer Profile Scores (IPS) and Credit Impact Scores (CIS) The launch of the ESG Score Predictor and Temperature Alignment Data Establishment of normative screenings for alignment with the UN Sustainable Development Goals (SDG) and Global Compact principles Acquiring RMS, a leading global provider of climate and natural disaster risk modeling and analytics. 1 Defined as LatinX, Black and Asian. 2 As of April 1, 2022. The population studied includes employees eligible for Moody's compensation programs and excludes limited duration employees, non-employees, temporary workers and employees from companies acquired in 2H 2021. Employees from V.E and Four Twenty Seven were excluded from the analysis due to not being integrated into Moody's compensation programs at the time of the analysis. This exclusion is non-material and represents 3% of employees. 3 Employee-driven giving includes grants paid from Moody's Foundation toward the Matching Gifts and Dollars for Doers programs. 4 Represents approximate revenue in (i) stand-alone ESG products and services, including our Climate Solutions, sustainable finance, research and insights products; and (ii) MA and MIS ESG-focused product enhancements. 92% Reduction in absolute Scope 1 and Scope 2 GHG emissions from 2019 base year $0.99 Earned by women globally for every $1 earned by comparable men² +36% Year-over-year increase in ESG-related revenue (excl. RMS)4#5A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 5 ABOUT MOODY'S Moody's at a Glance About This Report Our Commitment to Sustainability#6A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 6 Moody's at a Glance WHO WE ARE Moody's (NYSE: MCO) is a global integrated risk assessment firm that empowers organizations to identify, manage and measure risk and unlock opportunity. As financial markets become more sophisticated and interconnected, we believe that greater transparency, more informed decisions and fair access to information open the door to shared progress. With over 13,000 employees and operations in more than 40 countries, we combine global perspective with local expertise and over a century of experience in financial markets. WHAT WE DO Our organization comprises two primary business segments: » Moody's Investors Service (MIS) provides investors with a comprehensive view of global debt markets through credit ratings and research. MIS's trusted insights help equip decision-makers with information that will assist them in navigating turmoil and market volatility. >>> Moody's Analytics (MA) provides data, analytics and insights to equip leaders of financial, non-financial and government organizations with effective tools to understand a range of risks to make better, faster decisions. MA uses analytic models, industry insights, software tools and proprietary data assets to allow companies to inform and perform critical business activities. Customers make better decisions about risk and opportunities by using MA's integrated, efficient approach to aggregating, broadening and deepening available data, research and analytical tools and software solutions. 39% 2021 Revenue $6.2 BILLION FY 2021 REVENUE 40+ 13,000+ EMPLOYEES 100+ COUNTRIES YEARS 61% 1 MISSION MA MIS#7A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 7 HIGHLIGHTS WHAT WE BELIEVE Our values guide our progress in a complex and evolving environment. In all we do, we aim to act in a principled, inclusive, collaborative, forward-thinking and rigorous manner. We believe that quality information and financial knowledge is empowering and that our core values ensure better decision-making that promotes growth, sustainability and transparency. ба s's PRINCIPLED INCLUSIVE COLLABORATIVE FORWARD-THINKING RIGOROUS#8A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 8 Moo CONTINUING OUR SUPPORT THROUGHOUT THE COVID-19 PANDEMIC¹ We remain committed as ever to supporting our employees, customers, partners and communities through the ongoing challenges of the COVID-19 pandemic. Some examples include: » Providing complimentary access to our products and services valued at $22,500,000 since 2020 to help businesses, nonprofits and policymakers assess the risks and financial implications of COVID-19²; >>> >>> Offering employees flexibility to navigate the pandemic while working from home or the office through our Workplace of the Future initiative; Expanding our Moody's Moments that Matter wellness series, with virtual sessions aimed at helping employees adapt to hybrid work; and Extending Aid in Ukraine As the Ukraine-Russia crisis evolves, we are helping provide transparency to the marketplace by sharing research, outlook reports and other materials through our dedicated microsite, and donating an initial $250,000 through the Moody's Foundation to the International Rescue Committee (IRC), in addition to double-matching employee donations to other Ukraine relief efforts. $22,500,000 IN COVID-19-RELATED COMPLIMENTARY PRODUCTS AND SERVICES >>> Allocating additional PTO for employees and their families in all markets to get vaccinated. In certain geographies where new variants posed extreme challenges in 2021, such as the Delta variant surge in India, we provided our employees with a cash allowance, vaccination reimbursement, emergency medical support and/or outpatient coverage extension to ensure they had the resources they needed. To read more about our ongoing COVID-19 support, see Employee Health & Well-being, and Communities. 1 Refers to employees in Moody's payroll. ² Value of complimentary content, trials of MA products, new and pro bono products and services made available to the public. Cumulative number includes calendar years 2020 and 2021.#9A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 9 About This Report Our 2021 Stakeholder Sustainability Report builds on our inaugural 2020 report and highlights our progress toward incorporating sustainability into both our corporate performance and our products and solutions. For the purposes of this report, "sustainability" encompasses our ability to manage key risks and opportunities while also positively impacting our people, society and the financial markets. As such, this report covers everything from our Decarbonization Plan to our diversity, equity and inclusion efforts, the protection of our customers' data, as well as the continued integration of ESG considerations into our products and solutions. These strategies and select initiatives from 2021 are highlighted in three main sections, each focused on a different aspect of our global community: Better Business, Better Lives and Better Solutions. We support global efforts toward more consistent and comparable disclosures, and our reporting is in line with globally recognized and relevant ESG reporting frameworks. The metrics in this report cover calendar year 2021, unless stated otherwise, with qualitative discussions also representing early 2022 and future outlooks. The contents of our 2021 report are informed by an independent, comprehensive non-financial materiality assessment and by various leading ESG disclosure standards, including the Sustainability Accounting Standards Board (SASB), the Global Reporting Initiative Standards (GRI) and the World Economic Forum's International Business Council's Stakeholder Capitalism Metrics (WEF). PROGRESSING OUR REPORTING Our SASB 2020 report was made available for download in SASB XBRL Taxonomy. We have participated in the XBRL tagging pilot program in an effort to help advance more standards-based and comparable disclosure. In 2022, we are looking forward to furthering corporate transparency by joining the United Nations Global Compact's (UNGC) Early Adopters Program and being one of the first companies to disclose using the enhanced Communication on Progress (COP) questionnaire. » Hear more from Mark Kaye, CFO#10A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 10 110 Our Commitment to Sustainability NOTABLE AWARDS Today, our world is experiencing rapid, system-wide change largely driven by critical ESG factors. Important issues ranging from a warming planet to racial inequity in the workplace require concerted action by both the public and private sectors to create sustainable change. Our objective in this transformation is to help equip organizations and investors with the tools and insights that will empower them to make better decisions for a more resilient future. This starts with promoting responsibility and inclusivity across our workforce and operations. Outside our four walls, we are focused on leveraging our deep expertise, data and legacy solutions to integrate ESG across all of our platforms in order to meet the growing demand for ESG, including climate, insights. By making sustainability foundational to our business, we are contributing to this collective effort focused on more sustainable and inclusive financial markets. BETTER BUSINESS Member of ☆ America's Most Responsible Companies, Newsweek Dow Jones Sustainability Indices Powered by the S&P Global CSA A LIST 2021 Dow Jones Sustainability Index BETTER LIVES BEST Bloomberg CDP CDP A List for Climate Action; Supplier Engagement Leader CDP ENGAGEMENT CLIMATE DiversityInc TOP 50 2021 COMPANIES FOR DIVERSITY* BETTER SOLUTIONS Best Places to Work for LGBTQ+ Equality, Human Rights Campaign Foundation Buy-Side Technology Awards Winner 2021 Moody's Solutions Best ESG Data Provider, Waterstechnology Buy-Side Technology Awards 2021 Bloomberg Gender Equality Index DiversityInc 2021 Top 50 Regulation Asia 2021 Beds Winner Moody's Best Solution ESG Provider Best Solution in ESG Data Provider Category, Regulation Asia Awards for Excellence 2021 Seramount 100 Sustainable Investment Awards 2021 Winner Climate Risk Solution of the Year, Environmental Finance Sustainable Investment Awards 2021 FOR ENVIRONMENT IN CONSUMER JUST #1 for Environment in Consumer and Diversified SERAMOUNT 100BEST COMMNY Best Companies Finance, JUST Capital of the pr For a list of all of our awards and rankings, please see https://awards.moodys.io/. *Icon is not an actual award logo.#11A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 11 SUSTAINABILITY AT MOODY'S » Established Moody's Foundation Launched employee-led Business Resource Groups 2002 2008 Published our inaugural TCFD Report Joined the UN Global Compact, including becoming a founding member of its CFO Taskforce for the Sustainable Development Goals (SDGs) and signing its Business Ambition for 1.5°C pledge Became a signatory of the Principles for Responsible Investment >>> Published General Principles for Assessing Environmental, Social and Governance Risks, detailing our approach for incorporating ESG in credit ratings Acquired majority stake in V.E, global provider of ESG research, and in Four Twenty Seven, leading provider of climate risk tools Set science-based targets for reducing GHG emissions, published Decarbonization Plan and joined the Say on Climate campaign Appointed our first Chief Diversity Officer, with the DE&I function established in 2007 Committed $1 million to equal justice and support of the Black community, and committed to achieve Management Leadership for Tomorrow's Black Equity at Work Certification >>> Launched a comprehensive ESG Solutions unit to serve the growing demand for ESG insights >>> Published first Stakeholder Sustainability Report and launched sustainability website >>> Published inaugural DE&I >>> >>> >>> » >>> Updated MIS's ESG cross-sector methodology, published >>> in 2019, providing greater transparency on how ESG » considerations are incorporated into credit ratings Report and established tangible commitments to advance DE&I Implemented a new software to streamline our global pay equity analysis Committed to achieve net-zero across our operations and value chain by 2040 Became a founding member of the Net Zero Financial Services Provider Alliance Joined the Taskforce on Nature-related Financial Disclosures (TNFD) Updated our Environmental Sustainability Policy Published our EEO-1 data publicly for the first time Acquired RMS, a leader in climate and natural disaster risk modeling and analytics 2017 2019 2020 2021#12A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 12 SUSTAINABILITY STRATEGY Our sustainability framework is guided by the United Nations Sustainable Development Goals (SDGs) and based on our non-financial material topics. The framework connects our sustainability strategy to our business purpose and leverages our expertise, resources and values to drive positive, system-wide change through three areas: BETTER BUSINESS (888) BETTER LIVES We strive to embed responsible, sustainable decision-making in everything we do. More on page 20 We aim to create a forward-thinking, inclusive culture for our people and communities. More on page 39 C EBETTER SOLUTIONS We build products and services that companies can use to help mitigate emerging risks and accelerate market transformation. More on page 74 Hear more from Andrew Berenblum, Head of Stakeholder Sustainability#13A MESSAGE FROM OUR 2021 SUSTAINABILITY PRESIDENT & CEO HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 13 CONTRIBUTING TO UNITED NATIONS SDGS We are committed to responsibly managing our business and operations to further advance all of the global SDGs. We have identified the following five goals where we have opportunity to make the greatest impact given the nature of our business. 5 GENDER EQUALITY 9 INDUSTRY, INNOVATION AND INFRASTRUCTURE 10 REDUCED INEQUALITIES SDG 5 | Gender Equality: Achieve gender equality and empower all women and girls 9| Industry, Innovation and Infrastructure: Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation OUR CONTRIBUTION HOW WE MAKE PROGRESS Met and, in some cases, exceeded our diversity goals to increase the number of women at officer and entry levels globally; >>> Responsible sourcing » Diversity, equity and inclusion » Advance our ambition to achieve global gender pay equity; and Employee training » Expand our paid return-to-work program, RE-IGNITE, to the U.K. for mid-to-senior level individuals who are restarting their careers after at least a two-year hiatus. and upskilling » Communities >> Develop products and services to drive innovation, such as our suite of ESG and Climate Solutions, including the expansion of Issuer Profile Scores (IPS) and Credit Impact Scores (CIS) from sovereigns to corporations; and ESG solutions ESG integration such as » Diversity, equity and inclusion Communities » Help small- and medium-sized enterprises scale their business through our empowerment programs, Reshape Tomorrow™ and our investment in Trident, a private equity firm focused on small business investments to spark positive social and economic change in minority communities, as part of our CORE program. 13 CLIMATE ACTION 17 PARTNERSHIPS FOR THE GOALS 10 | Reduced Inequalities: Met our diversity goal to increase the number of Black and LatinX leaders at senior levels in the U.S.; » Advance our ambition to achieve pay equity for racial/ethnic underrepresented groups in the U.S.; and Propel diverse talent forward through our dedicated talent accelerator programs, such as TIDE, Conecta Mos mentorship initiative and the Asian Leadership Initiative (ALI). Reduce inequality within and among countries >>> >>> Responsible sourcing » Diversity, equity and inclusion » Employee training and upskilling 13 | Climate Action: Take urgent action to combat climate change and its impacts 17 | Partnerships for the Goals: Strengthen the means of implementation and revitalize the global partnership for sustainable development >>> Decarbonize our operations and value chain: - achieve net-zero by 2040; - reduce our absolute Scope 1 and Scope 2 greenhouse gas (GHG) emissions 50% by 2030 from 2019 levels; - reduce by 15% our Scope 3 emissions from fuel and energy-related activities, employee commuting and business travel by 15% by 2025 from 2019 levels; and - have 60% of our suppliers by spend covering purchased goods and services and capital goods set science-based targets by 2025. » Align and partner with like-minded organizations and campaigns driving impact across our sustainability pillars, including the UNGC Say on Climate, WeConnect International and Accounting for Sustainability (A4S); and » Continue to create new partnerships with other leading climate groups like GFANZ and TNFD. >>> Climate » Responsible sourcing » Our commitment to sustainability Climate Diversity, equity and inclusion Communities#14A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX MATERIALITY ASSESSMENT We completed a non-financial materiality assessment that identifies the sustainability topics most relevant to our internal and external stakeholders and most influential to our business. Materiality assessment inputs: » >>> Industry trends, social listening research and international sustainability frameworks (e.g., SASB, GRI, TCFD, WEF and SDGs). Interviews and surveys collected from over 2,000 internal and external stakeholders - including our executive leadership team and the global workforce, customers, shareholders and NGO / advocacy groups. Throughout this report, we discuss our ongoing progress and forward-looking goals for each of these material topics. In addition to the topics discussed in the materiality assessment, this report also addresses other topics material to our business, including cybersecurity and data privacy. MATERIALITY TOPICS (AS OF Q3 2020) M Moody's role in the market E Environment H Human capital S Social capital Governance LOW IMPORTANCE TO STAKEHOLDERS MEDIUM HIGH H Employee health and well-being M Enhancing capital allocation decisions E Climate S Education S Support for small-and-medium-sized enterprises (SME) M ESG integration M Process transparency and disclosure G Transparency and reporting G Human rights G Board diversity G Executive compensation E Responsible sourcing S Supplier diversity S Philanthropy and employee engagement Moody's 2021 Stakeholder Sustainability Report 14 H Diversity, equity and inclusion H Employee training and upskilling H Employee incentives and risk culture LOW MEDIUM HIGH INFLUENCE ON BUSINESS SUCCESS#15A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 15 BETTER BUSINESS DEFINITION RELATED SECTIONS IN REPORT TRANSPARENCY AND REPORTING Publicly accessible information pertaining to our governance, stakeholders (including employees), environmental performance and supply chain >>> All CLIMATE How we analyze our climate risk exposure and minimize our greenhouse gas emissions >>> Climate >>> Responsible sourcing RESPONSIBLE SOURCING Our ability to maintain a secure, environmentally sustainable and fair supply chain for our assets and services and ensure the humane treatment of workers employed within our supply chain >>> Responsible sourcing HUMAN RIGHTS The maintenance and implementation of human rights policies for our company >>> Ethics and integrity >>> Responsible sourcing EMPLOYEE INCENTIVES AND RISK CULTURE How we promote an effective risk culture throughout the organization, including appropriate incentives, risk management training and leadership enforcement » Ethics and integrity >>> Risk management >>> Cybersecurity and data privacy EXECUTIVE COMPENSATION BOARD DIVERSITY SUPPLIER DIVERSITY Our ability to provide fair and transparent compensation of executives >>> Corporate governance How the board maintains its diverse composition according to gender, ethnicity and skills criteria How we promote a diverse range of suppliers, to include more small and medium enterprises (SMEs) and companies led by individuals from underrepresented ethnicity or gender >>> Corporate governance >>> Responsible sourcing#16A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 16 BETTER LIVES DIVERSITY, EQUITY AND INCLUSION EMPLOYEE HEALTH AND WELL-BEING EMPLOYEE TRAINING AND UPSKILLING DEFINITION RELATED SECTIONS IN REPORT Our ability to ensure employees from diverse backgrounds, genders and ethnicities are offered equal opportunities at all levels >>> Diversity, equity and inclusion The efficacy of policies and practices to maintain a healthy and safe work environment, as well as our success in ensuring the physical and mental well-being of our employees » Employee health and well-being How we provide employees with access to training and education in skills that improve employability in the future >>> Employee training and upskilling EMPLOYEE INCENTIVES AND RISK CULTURE How we promote an effective risk culture throughout the organization, including appropriate incentives, risk management training and leadership enforcement >>> Diversity, equity and inclusion » Employee training and upskilling >>> Employee health and well-being EDUCATION PHILANTHROPY AND EMPLOYEE ENGAGEMENT How we support the advancement of education in technology, finance and sustainability in the communities where we operate How we contribute to social and environmental causes through grants, gifts in-kind and related charitable activities, and how those contributions, in turn, make employees feel about working at the company SUPPORT FOR SMES How the company maximizes engagement, training and education opportunities for SMEs >>> Communities >>> Diversity, equity and inclusion >>> Communities >>> Diversity, equity and inclusion >>> Communities#17A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 17 BETTER SOLUTIONS DEFINITION ESG INTEGRATION Enhancing systematic integration of ESG considerations in our products and solutions PROCESS TRANSPARENCY AND DISCLOSURE ENHANCING CAPITAL ALLOCATION DECISIONS Contributing to better alignment of key stakeholders through consistent transparency and enhanced disclosures of ESG considerations, how these are integrated, and the extent to which they are deemed financially material in credit assessments Our ability to enable financial, non-financial and government organizations to make more informed decisions in relation to capital allocation reflecting ESG risks and opportunities through the provision of high-quality data, analytics and insights RELATED SECTIONS IN REPORT » ESG integration » ESG solutions >>> ESG integration >>> ESG solutions ESG integration#18A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 18 STAKEHOLDER ENGAGEMENT Our ability to execute on our sustainability strategy in a meaningful way requires input from all our stakeholders. We actively and regularly engage with a diverse set of internal and external stakeholders, including customers, employees, investors, suppliers, communities, government regulators and policy influencers. Input from these engagements helps us shape, advance and implement our sustainability strategy and is reflected in how we are striving to build a more resilient future. We engage with these groups to keep them informed of our efforts through a variety of channels, including in-person or virtual meetings, internal employee engagement such as well-being surveys and team conversations, annual perception studies, customer satisfaction surveys, social media accounts and community events. OUR EXTERNAL INITIATIVES External initiatives are one of the critical avenues through which we engage our stakeholders. We incorporate best practices and guidance from the following organizations: » Accounting for Sustainability (A4S) Ceres Company and Investor Network Chief Executives for Corporate Purpose Global Reporting Initiative >>> Principles for Responsible Investment >>> UN Global Compact >>> Value Reporting Foundation (International Integrated Reporting Council and SASB) >>> CDP "We are proud to have Moody's Chief Financial Officer, Mark Kaye, on our CFO Leadership Network, and to see the progress the team is making on its climate, diversity and reporting efforts each year. Moody's plays an essential leadership role in advancing environmental, social and governance standards, providing thought leadership on these topics and factoring the associated risks and opportunities into its business, processes and actions. We are delighted to continue to work together and enable more resilient business models and sustainable economies for market participants. 11 - Jessica Fries, Executive Chairman, A4S#19A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 19 19 Below are select examples of how we addressed stakeholder feedback in 2021. Customers Investors Communities » Continued to invest in our ESG capabilities and best practices by enhancing and launching a wide range ESG and climate solutions; >>> Published our EEO-1 data publicly for the first time; >>> of Worked with eight Reshape Tomorrow™ partners in communities around the world; >>> >>> » Submitted our Decarbonization Plan to a stockholder advisory vote at the 2021 Annual Meeting of Stockholders; » Supported the education of and investment in people of color, women and members of under- resourced groups; and >>> >>> Produced a first-of-its-kind report incorporating insights from across the enterprise, Ready or Not?: Sector Performance in a Zero-Carbon World; Acquired RMS, a leader in climate and natural disaster risk modeling and analytics; and >>> Held calls with investors on ESG and sustainability, including our environmental commitments and disclosure of DE&I data; and Significantly enhanced our sustainability and ESG content in our investor relations materials, including our website, disclosures and presentations. » >>> Expanded our Creating Opportunities for Racial Equity (CORE) program, which has deposited a cumulative $10 million in Black-owned banks as of 2021. Employees¹ >>> Expanded the Moody's Moments that Matter virtual work wellness series; Launched a new global performance management system in response to feedback from our employee survey and pulse assessments; and Established our employee learning and development program, Moody's University (Moody's U), to provide more accessible training for employees seeking career advancement and development opportunities. >>> For more, see Moody's Investor Relations website. Suppliers » Engaged nearly 500 of our top suppliers and requested they participate in the annual CDP disclosure; » Increased percentage of suppliers by spend who have science-based targets to 28%; and » Continued to encourage diverse supplier spend through our Supplier Diversity Program. Awarded over $3 million in Moody's Foundation grants. Policy influencers » » >>> Participated in road-testing the Science Based Targets initiative (SBTI) Net-Zero Standard and contributed to the SBTI Net-Zero Foundations for Financial Institutions Draft for public consultation; Launched, as a founding member, the Net Zero Financial Services Provider Alliance as part of the GFANZ; Joined the TNFD to help develop a reporting framework; and Contributed to COP26 discussions on the challenges faced by companies and investors on adoption and acceleration of net-zero targets. Government and regulators Proposed public funding programs for increased access to capital and greater financial independence for women in a joint Women Empowerment Manifesto signed by the G20 Business Advisory Council; and Engaged with regulators on issues of public policy affecting Moody's globally, including capital markets, data and technology, economic recovery and ESG and climate risk policy. To dive into our latest insights and analysis on the key trends shaping ESG, climate risk and sustainable finance globally, visit our Insights & Analysis hub. 1 Refers to employees on Moody's payroll.#20A MESSAGE FROM OUR 2021 SUSTAINABILITY PRESIDENT & CEO HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 20 BETTER BUSINESS Corporate Governance Ethics and Integrity Risk Management Climate Responsible Sourcing Cybersecurity and Data Privacy#21A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report Better Business 21 21 We are working toward building a better business by embedding responsible, sustainable decision-making into everything we do. Our corporate governance, high standards for ethics and integrity and rigorous risk management enable us to identify and prioritize actions that advance positive change and address issues like climate change, responsible sourcing and cybersecurity - the three main components of our Better Business framework. LEADING ON CLIMATE ACTION We are transforming how we work in response to the climate crisis. Our Decarbonization Plan sets out our commitments on the path to net-zero emissions by 2040. MANAGING OUR SUPPLY CHAIN RESPONSIBLY We are working to build a supply chain that upholds the same standards we do by championing climate action, diversity and ethical codes of conduct. STRENGTHENING CYBERSECURITY AND DATA PRIVACY We are committed to developing our robust technology infrastructure and security-first philosophy to protect against cyber threats and safeguard the privacy and data of our stakeholders.#22A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 22 22 Corporate Governance Strong leadership and governance start at the top of the organization. Our Board of Directors sets high standards for our employees, officers and directors. The Board oversees the management and overall strategy of Moody's - including the advancement of our sustainability strategy. The Board's oversight extends throughout the year, as management continually adjusts its approach in response to emerging sustainability-related risks and opportunities. OUR ACTIONS We continue to improve our corporate governance to further integrate sustainability into our business strategy. This includes: Expanded voluntary sustainability disclosure in the Form 10-K and 10-Q More fully integrated sustainability-related performance metrics into the Strategic & Operational compensation metric of all senior executives The Executive Leadership team, which is composed of the CEO and his direct reports, serves as the decision-making body for key strategic sustainability efforts, with oversight from three committees of the Board of Directors. These committees include: » Audit Committee: Oversees financial, risk, accounting and other disclosures made in our annual and quarterly reports related to sustainability and supports the Board in its duties related to the oversight of risk assessment and risk management processes » >>> Governance & Nominating Committee: Oversees sustainability matters related to the business and to long-term value creation and makes recommendations to the Board regarding these issues Compensation & Human Resources Committee: Reviews introduction of sustainability-related performance goals for determining compensation of certain senior executives Senior Management, composed of the Executive Leadership team's direct reports, is responsible for identifying and implementing sustainability and ESG-related risks and opportunities into their respective strategies. 1 Dual reporting line to the CEO and Chief Strategy Officer. 2 Dual reporting line to the CEO and Chief People Officer. BOARD OF DIRECTORS AUDIT COMMITTEE GOVERNANCE & NOMINATING COMMITTEE CHIEF FINANCIAL OFFICER CHIEF INFORMATION OFFICER GENERAL COUNSEL COMPENSATION & HUMAN RESOURCES COMMITTEE HEAD OF STAKEHOLDER SUSTAINABILITY HEAD OF MOODY'S ESG SOLUTIONS CHIEF PEOPLE OFFICER CHIEF DE&I OFFICER² PRESIDENT & CEO HEAD OF GLOBAL CORPORATE AFFAIRS¹ CHIEF RISK MANAGEMENT & AUDIT EXECUTIVE CHIEF STRATEGY OFFICER PRESIDENT OF MOODY'S ANALYTICS PRESIDENT OF MOODY'S INVESTORS SERVICE CHIEF OF STAFF HEAD OF CSR GENERAL MANAGER OF RMS#23A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 23 BOARD EXPERTISE AND EDUCATION Our Board of Directors is comprised of individuals with wide-ranging experience in ESG, cybersecurity and risk management topics. The chairman of the Audit Committee, Leslie F. Seidman, who also serves as a member of our Governance & Nominating and Compensation & HR Committees, was recently certified in ESG oversight (GCB.D, 2021) and is also certified in cybersecurity oversight (2018). Lloyd W. Howell Jr., a member of our Governance & Nominating and Compensation & HR Committees, brings a strong background in information systems and cyber-related matters. The Board continues to enhance its collective knowledge of sustainability topics through ongoing education. The Board and its committees receive regular presentations from management on various environmental and social issues such as climate; diversity, equity and inclusion; pay equity; and the integration of ESG factors into our products and solutions. The Board received training from a third party in 2021 regarding oversight considerations with respect to ESG trends and developments. Additionally, management performed a cybersecurity tabletop exercise with the Board to inform the members of their role with respect to response capabilities. BOARD DEMOGRAPHICS All directors, with the exceptions of Robert Fauber and Raymond W. McDaniel Jr., are independent under the independence criteria defined in the New York Stock Exchange listing standards. For more information about the composition of our Board of Directors, see our 2022 Proxy Statement, page 3. 70% Gender Diversity¹ 30% 20% 10% Racial/Ethnic Diversity¹ 70% Female Male White Underrepresented groups² Not disclosed 1 Data as of 2022 Annual Shareholder meeting in April 2022. ² Underrepresented groups include those who identified as Asian, LatinX, Black, Native American/Alaskan Native, Hawaiian / Other Pacific Island or two or more races.#24A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 24 EMBEDDING SUSTAINABILITY METRICS INTO EXECUTIVE COMPENSATION We hold our executive leadership accountable for the achievement of our sustainability goals. In 2020, our management team introduced sustainability-related performance metrics for determining compensation of certain senior executives, including the CFO. In 2021, these efforts were expanded with sustainability-related performance metrics, including pre-existing diversity, equity and inclusion targets, being more fully integrated into the Strategic & Operational metrics used to determine annual cash incentive payments for all senior executives. Further, the CFO had his pay tied to the advancement of the company's sustainability programs, including progress on our Decarbonization Plan and best-in-class sustainability-related disclosures and reporting. For more information on our climate targets, see our Decarbonization Plan. Remuneration policies for our highest governance body and senior executives can be found in our 2022 Proxy Statement, pages 22-26, 38-59. For more information on our policies regarding corporate governance, see Additional Resources. KL#25A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report Ethics and Integrity' 25 25 Our commitment to operating in an ethical and lawful manner, including to help protect human rights, serves as the foundation for our relationships with employees, customers and suppliers, as well as the people in the countries and communities in which we operate. OUR CODE OF CONDUCT We require all employees and directors to abide by our Code of Business Conduct, which outlines the principles and policies they are expected to uphold to achieve the highest standard of integrity and ethics in all business practices. The Code of Business Conduct is revised and republished at least every two years and is available in 11 languages. In addition, MIS has a Code of Professional Conduct that governs its credit ratings activities. All employees must complete compliance and ethics training as an integral part of their professional development. Upon hiring and periodically thereafter, our employees receive mandatory training on the Code of Business Conduct and other company policies, which set forth our expectation that employees comply with all applicable laws and address various topics including health and safety and human rights content. In addition to complying with all relevant codes, laws and regulations, employees are expected to display the highest standards of professionalism and appropriate judgment in their decision-making. Our performance evaluations include criteria such as "Exhibits highest standards of professionalism, ethics and credibility," "Behaves responsibly and takes accountability for actions" and "Is transparent in words, actions and intentions." HUMAN RIGHTS Our commitment to operating in an ethical and lawful manner includes protecting the basic dignity and human rights of our employees and the people in our supply chain. Our Human Rights Statement provides an overview of how we endeavor to meet the responsibility with respect to human rights, in addition to the principles and requirements within our Code of Business Conduct. We also issue a Modern Slavery and Human Trafficking Statement annually that sets out our approach to preventing human rights violations in our workforce and supply chain. ANTI-CORRUPTION AND ANTI-MONEY LAUNDERING Our employees receive training upon hiring and periodically thereafter on our Anti-Bribery and Anti-Corruption Policy, which sets forth the expectation that employees comply with all applicable anti-bribery and anti-corruption laws. Additionally, we offer guidance through our internal Anti-Bribery Resource Center. For more information, see Moody's Anti-Bribery and Anti-Corruption Policy. We comply with all applicable anti-money laundering (AML) laws and related know Your Customer (KYC) and Enhanced Due Diligence (EDD) requirements wherever we operate. Although our business activities generally do not expose us to the risk of being a conduit for money laundering activity, in certain jurisdictions, our role in the financial transactions of others may subject our activity to locally applicable AML laws or regulations and require the establishment of an AML program. In such jurisdictions, we have implemented appropriate AML policies and programs, including annual policy certification for all applicable employees. 1 Refers to Moody's Corporation and its wholly-owned subsidiaries.#26A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 26 REPORTING MECHANISMS The Integrity Hotline, which allows employees, suppliers and members of the public to report any suspected wrongdoing anonymously, is staffed by a third party and is available at all times and in multiple languages. Reports made via the Integrity Hotline are forwarded to our Legal and Compliance departments for follow-up, and all reports of suspected violations are promptly investigated and remediated. We take appropriate disciplinary action, up to and including termination of employment, against those who violate the law, regulations, our Code of Business Conduct or other company policies. We prohibit, and do not tolerate, any form of retaliation against those who raise issues or report concerns in good faith. In addition, our employees have a number of other channels to report concerns, including via our Open Door Policy, or directly to Human Resources, Compliance or the Legal department. PUBLIC POLICY We believe that greater transparency, more informed decisions and equity around information access open the door to shared progress. Consequently, public policy is an integral part of our engagement strategy and core to our business. We regularly engage with policymakers and regulators globally on issues that are important to us and our stakeholders. We provide insights to governments on a host of market issues, principally those relating to capital markets, macroeconomics, ESG and sustainable finance, trade and economic recovery. Our lobbying positions support our purpose, policies and positions. In 2021, we published our Political Engagement & Public Policy Statement, outlining our governance and approach to advocacy, lobbying, political contributions and employees' political activities. Moody's does not maintain a political action committee (PAC) or make any political contributions, including in-kind contributions. We do not currently engage in grassroots lobbying. In the United States, federal lobbying expenses are reported in compliance with the U.S. Lobbying Disclosure Act. In the fourth quarter of 2021, we registered as a lobbying entity for the first time and reported $520,000 in lobbying expenses for that quarter. For the first three quarters of 2021, external lobbyists reported $180,000 in lobbying expenses on behalf of Moody's. We also reported $284,000 in lobbying expenses at the state level in the U.S. In line with European law, Moody's Shared Services U.K. Ltd is registered on the EU's transparency register and, for 2021, has reported €500,000 €599,000 in activities related to engaging with E.U. institutions. We are also a member of various interest groups and engage with think tanks globally. These organizations provide venues for policy discussions and opportunities for advocacy on common areas of interest, including COVID-19 and economic recovery, capital markets, sustainability and credit rating agencies. Total fees paid to principal U.S. trade organizations in the fiscal year 2021 were approximately $855,000. For more information on our policies regarding ethics and integrity, see Additional Resources.#27A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 27 22 Risk Management' We strive to create confidence in thousands of organizations worldwide through our ability to help others better understand, measure and manage risk. We strive to approach our own risk management with the same level of rigor and continue to mature our risk management practices and capabilities to better serve our stakeholders. ENTERPRISE RISK MANAGEMENT Our Board of Directors oversees management's implementation of policies and processes to manage our company's exposure to risk. The Audit Committee supports the Board to oversee the company's risk assessment and risk management processes. Our Enterprise Risk Management (ERM) function is designed to establish a standard, organization-wide understanding of risk management and define roles and responsibilities based on the 2017 Committee of Sponsoring Organizations (COSO) framework. Our Chief Risk Officer (CRO) is responsible for the full ERM program, which consists of business-focused risk functions that coordinate with a central independent group. We continue to integrate ESG considerations into our ERM processes. For more information about our risk factors, see our 2021 Annual Report, pages 27-37. BUSINESS CONTINUITY MANAGEMENT We recognize our responsibility to our customers to continue critical operations during disruptive events. Our Business Continuity plans are reviewed by Internal Audit in conjunction with their annual audit plan. The plans include local crisis management teams and risk assessments for every office location. We continually update these plans and assessments in response to changes in external risks and internal business processes, and we have integrated lessons learned from the ongoing COVID-19 pandemic. Additionally, we conduct annual third-party risk assessments of key vendors and run a risk-based testing program that includes tabletop scenario exercises related to cybersecurity. RISK EDUCATION AND AWARENESS We have taken steps to improve our risk education and culture, with the goal of cultivating a robust understanding and awareness of risk among employees. As a company in the business of assessing risk, this concept is deeply important to and understood by our employees. On the ground level, we work to foster a culture and work environment in which all employees feel comfortable asking questions, seeking advice and raising issues that are important to them, including reporting allegations of non-compliance with laws, regulations and policies. For more information on compliance training and reporting mechanisms, see Ethics and Integrity. For more information on our policies regarding risk management, see Additional Resources. 1 Refers to Moody's Corporation and its wholly-owned subsidiaries.#28A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 28 Climate Climate change is one of the defining issues of our time. While our business is not a major emitter of greenhouse gas (GHG) emissions and has a limited direct environmental impact, we have an important role to play in modeling proactive corporate responsibility, setting industry standards and demonstrating best practices. We are taking significant steps to advance climate action by publishing our TCFD report on an annual basis, issuing our Decarbonization Plan with science-based targets and a comprehensive road map, as well as accelerating our commitment to achieve net-zero emissions across our operations and value chain by 2040. CLIMATE RISKS AND OPPORTUNITIES We assess climate-related risks and opportunities through a multidisciplinary risk management process and have implemented the 11 TCFD recommendations. Our 2021 TCFD report introduces: » » >>> The assessment of physical risk based on employee addresses to capture the real risk of business continuity from a climate event due to remote work; An advanced physical risk analysis powered by RMS, a Moody's 2021 acquisition; An evolved financial risk profile in the face of climate considerations; The incorporation of costs from renewable electricity in the transition risk scenario analysis; and The assessment of resiliency and climate maturity for critical suppliers. LINKING FINANCIALS TO OUR CLIMATE STRATEGY In 2021, we established our first sustainability-linked credit facility to advance our climate targets, specifically 60% of our vendors by spend to have science-based targets by 2025. The $1.25 billion senior unsecured revolving credit facility includes a sustainability-linked pricing adjustment to support the global transition to the net-zero economy.#29A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 29 PARTNERING FOR CLIMATE IMPACT CDP ALIST 2021 CLIMATE CDP: In 2021 we received an 'A' score from CDP on climate action for the second consecutive year and were featured in CDP's 2021 Stories of Change. The top score recognizes us as one of a small number of high- performing companies out of nearly 12,000 that are leading actions to cut emissions, mitigate climate risks and develop the low-carbon economy. GFANZ Glasgow Financial Alliance for Net Zero Glasgow Financial Alliance for Net Zero (GFANZ): As part of GFANZ, we are a founding member of the Net Zero Financial Services Provider Alliance - a global group of 23 financial service providers committed to supporting the goal of global net-zero greenhouse emissions by 2050 or sooner. We are committed to aligning our relevant products and services to this goal, in addition to reducing our own operational emissions. SCIENCE BASED TARGETS Science Based Targets initiative (SBTI): In 2021, we participated in the road test for SBTi's Net-Zero Standard, the objective of which is to provide a standardized and robust approach for corporates to set net-zero target that are aligned with climate science. Our near-term targets and long-term net-zero target have been validated by the SBTI. TCFD TASK FORCE CLIMATE-RELATED FINANCIAL DISCLOSURES Task Force on Climate-related Financial Disclosures (TCFD): We were one of the first financial firms to endorse and report based on recommendations from the TCFD, and our Chief Credit Officer has supported the development of these decision-useful recommendations for investors as a TCFD Task Force Member since 2016. TN FD Taskforce on Nature-related Financial Disclosures Taskforce on Nature-related Financial Disclosures (TNFD): We joined the TNFD, a new industry-led initiative working to significantly shift global financial flows from nature-negative to nature-positive outcomes. As a TNFD member, we will join leading organizations across key sectors and geographies to develop a reporting framework and act on evolving nature-related risks. WE SUPPORT GLOBAL COMPACT United Nations Global Compact (UNGC): We are a member of the UNGC's CFO Taskforce for the Sustainable Development Goals, which aims to advance the SDGS through corporate strategy and investments. In 2021, we joined the UNGC's Action Platform on Climate Ambition and will become sponsors of UNGC Climate in 2022. As an active UNGC participant and a signatory to UNGC's Business Ambition for 1.5°C, we affirm our support annually for Principle 7: "Businesses should support a precautionary approach to environmental challenges."#30A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 30 CLIMATE METRICS AND TARGETS In 2021, we accelerated our ambition to reach net-zero emissions by 2040, a decade earlier than our previous commitment to the UNGC Business Ambition for 1.5 °C. We took significant steps towards this goal - of note, we set a long-term net-zero target, progressed on our near- term net-zero targets to reduce GHG emissions, continued to procure 100% renewable electricity and to offset the remainder of our emissions from our operations, business travel and employee commuting. ACHIEVING OUR SCIENCE-BASED TARGETS Our science-based targets are focused on three critical aspects of reducing our GHG emissions. In 2021, we exceeded our GHG emissions reductions targets and made strong progress toward our supplier engagement target, with 28% of suppliers by spend now committed to science-based targets. Near-term net-zero targets² 50% reduction in absolute Scope 1 and Scope 2 GHG emissions by 2030¹ Progress against our targets Exceeding target 76% 92% 15% reduction in Scope 3 GHG emissions from fuel and energy-related activities, business travel and employee commuting by 20251 Exceeding target 81% 95% 60% of our suppliers by spend covering purchased goods and services and capital goods to have science-based targets by 2025 In progress 2040 Net-zero target In addition to this progress, we are announcing our long-term net-zero SBTi-validated target of 90% emissions reductions in Scope 1, 2 and 3 emissions by 2040¹. 2020 2021 1 From a 2019 base year. 2 Our progress on science-based targets was retroactively recalculated due to improved access to vendor spend data and M&A activity. Consequently, our targets were re-submitted to the Science Based Targets initiative (SBTI) and coverage was re-validated. Renewable electricity percentage is reported based on originally verified electricity consumption values because it is not possible to buy renewable electricity retroactively due to M&A activity; therefore, the 2020 restated verification opinion shows a decrease in percentage renewable electricity. 100% renewable electricity³ Achieving target 2030 Target 28% 2025 Target 24% Carbon emissions offset 100% target Achieving target 2000 2021 2025 Target#31A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 31 OFFSETTING OUR CARBON EMISSIONS In addition to the reported emissions reductions, we are committed to offsetting our emissions from operations, business travel and employee commuting on an annual basis. In 2021, we continued to offset our carbon footprint since 2000, when we became a public company. Our carbon offset projects are selected based on the geographies where we operate and alignment with SDGs and co-benefits; projects are also listed on reputable registries that guarantee third-party verifications. In 2021, we continued our climate project engagements with VERRA and Gold Standard to support our emissions offsets. These global engagements included wind, forestation, clean cookstove and borehole-related initiatives. CONSIDERATIONS FOR NEW OFFICE LOCATIONS Environmental considerations help to guide our selection of office locations. This includes leasing space in energy- efficient buildings that are Leadership in Energy and Environmental Design (LEED) certified (or a local equivalent outside the U.S.). Currently, approximately 58% of our employees are working in such buildings - a decrease compared with the previous year due to significant merger and acquisition (M&A) activity. We also evaluate whether a location has convenient access to public transportation, includes bicycle storage and shower facilities to promote exercise and greener commuting, and uses energy-efficient, recycled and sustainable materials, fixtures and control systems. In addition, we consider the cost of carbon when selecting new office spaces. Certified climate projects supporting our 2021 emissions offsets VERRA Standards for a Sustainable Future Gold Standard® ADVANCING OUR DECARBONIZATION PLAN IN 2021 » Procured 100% renewable electricity. » >>> Implemented various projects to promote energy efficiency, including: Increased temperature set-point in technology rooms; » » Continued to implement an Internal Carbon Fee of USD $50 per metric ton (mtCO2e) on business travel emissions. Continued to apply a shadow price on carbon to evaluate new office leases. » Promoted participation in the Daylight Hour campaign, organized by the Building Energy Exchange to raise awareness about using natural light instead of electric light; and Launched an updated company-wide environmental sustainability policy. » - Installed light saving mechanisms in some offices, such as sensor motion lights and energy saving LED lights. Maintained business travel and employee commuting low in light of COVID-19. >>> » Implemented quarterly meetings among our global office representatives to share best practices on reducing emissions from our operations. Prioritized sustainable construction and furnishing materials' in new real estate projects. Continued to engage with our stakeholders on climate-related issues. For more information, see Stakeholder engagement. >>> Wind project (Costa Rica) » Clean cookstoves project (Kenya) Wind project (India) >>> Boreholes (Malawi) » Forestation (Canada) » Clean cookstoves project (India) In 2021, we became the first S&P 500 company to ask its stockholders to vote on its Decarbonization Plan, which seeks to implement sustainable business plans and advocate corporate climate action while giving stockholders a meaningful voice. The Plan received 93% of votes in support. 1 Materials manufactured with recycled content or third-party certified for complying with recognized sustainability standards.#32A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 32 GHG emissions mtCO2e 187,695 1,744 13,591 122,563 116,032 919 2,745 172,360 112,368 20191 20201 Scope 1 Scope 2 (market-based) 121,280 Scope 3² 2021 851 432 Data governance and climate-related reporting We are committed to the highest standards of data integrity and continually seek to elevate its rigor. In 2021, we implemented the following improvements to our data governance: » Developed and enhanced our data governance methodologies for environmental metrics; » >>> Operationalized the use of an environmental management system that has become our single source of truth for all climate data; and Improved the way we collect, store and transmit our sustainability data by leveraging a digital platform that centralizes and streamlines our reporting efforts and mitigates data integrity risk. We verify data quality and performance on an ongoing basis, and we annually engage third- party verifiers to review our GHG inventory. For more information, see Moody's Environmental Assurance Statement in our 2021 TCFD Report. 1 Our 2019 and 2020 GHG emissions were retroactively recalculated due to improved access to vendor spend data and M&A activity. Consequently, our science-based targets for reducing our GHG emissions were re-submitted to the Science Based Targets initiative (SBTI) and coverage was re-validated. ² Business travel and employee commuting emissions were restated to include well-to-wheel emissions to ensure alignment to the SBTI Target Validation Protocol and Transport Guidance.#33A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 33 ENVIRONMENT AND NATURAL RESOURCES We are committed to reducing our environmental impact by embedding responsible, sustainable processes across our global operations and value chain. Updating Our Environmental Sustainability Policy In 2021, we updated our Environmental Sustainability Policy to reflect our latest efforts to enhance our environmental performance and reach net-zero by 2040. The updated policy describes our goals and initiatives to reduce emissions and other environmental impacts, including the introduction of waste targets, and was reviewed and approved by our Board of Directors. In addition to our corporate commitments, the policy outlines ways in which we endeavor to empower our employees to be catalysts of environmental and social change, support environmental projects through the Moody's Foundation and provide market participants with products and solutions that help mitigate ESG-related, including climate, risks. Reducing the environmental impact of our offices We are making our offices more environmentally friendly by purchasing sustainable materials, improving waste management, leveraging renewable electricity, limiting business travel and promoting sustainable commuting options. As we return to our offices, we are implementing a number of changes to encourage our employees to reduce, reuse and recycle waste. By 2025, we aim to: » >>> >>> Reduce office paper by 50% from 2019 levels through initiatives such as reduction of individual printers and digitization of daily business activities; Implement centralized waste collection in offices with more than 50 full-time employees; and Phase out single-use plastics from our global operations, where possible. For more information on our policies regarding climate mitigation and natural resource management, see Additional Resources. Waste from office operations metric tons 241 39 149 Reduction of office paper from 2019 levels¹ 99% 79% 50% target 2020 2021 Landfill Recycled goods Recycled paper Energy intensity ratio kWh/sq ft 19.8 13.0 11.9 2019 2020 2021 1 Represents our offices in the U.S. We are working to collect actual data globally.#34A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 34 Responsible Sourcing We are working to build a sustainable supply chain that upholds our rigorous standards and champions climate action, diversity and ethical codes of conduct. In addition to engaging our suppliers on climate and increasing our supplier diversity, we have enhanced our due diligence assessments to quantify and monitor potential ESG risks in our supply chain. ENGAGING SUPPLIERS ON CLIMATE Engaging suppliers to reduce their own emissions is a key element in our strategy to achieve net-zero emissions. In our Decarbonization Plan, we set a target for 60% of our suppliers by spend covering purchased goods and services and capital goods to have science-based targets by 2025. As of year-end 2021, we increased our spend to 28%. We continue to seek opportunities to engage with and encourage existing suppliers to set science-based targets. Our updated Supplier Code of Conduct encourages suppliers to disclose their carbon footprint and set science- based targets, and we are working to update key supplier contracts with the requirement to disclose such targets. In addition, we engage suppliers through multiple channels to emphasize the importance of carbon disclosures and transparency. In 2021, we hosted webinars for nearly 500 of our top suppliers, requesting that they participate in the annual CDP Climate Change disclosure and set their own science-based targets. With our executive leadership team, as well as through a partnership with CDP, we followed up directly with a number of our priority suppliers and reinforced our commitment to climate action and our expectations of key suppliers. All of our sourcing managers receive training on responsible sourcing. This training is designed to educate our buyers on social and environmental issues within the supply chain, with a focus on factoring responsible sourcing - including science-based targets and supplier diversity - into award decisions. In recognition of these efforts, we were named a 2021 Supplier Engagement Leader by CDP for the second consecutive year, placing us among the top 8% of companies assessed for supplier engagement on climate. CDP SUPPLIER ENGAGEMENT LEADER 2021 Among the top 8% of companies assessed by CDP for supplier engagement on climate#35A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 35 INCREASING SUPPLIER DIVERSITY¹ We are committed to providing our suppliers with equal access to business opportunities. Our supplier diversity efforts focus on encouraging diverse suppliers to bid on projects and submit proposals, selecting qualified diverse suppliers when awarding contracts, and enhancing our relationships by offering networking and mentorship opportunities. Our Supplier Diversity Program aims to increase our partnerships with small business enterprises and businesses owned by people of underrepresented racial and ethnic groups, women, people with disabilities, veterans and members of the LGBTQ+ community. We also work with our suppliers to encourage diverse spend within their own supply chains. We recently formally launched our Tier II Supplier Diversity Program, which aims to identify, track and manage the diverse spend of our top 50 suppliers. In 2021, we added over 30 certified diverse suppliers to our network and increased our diverse supplier spend by 15% from 2020. For women-owned business, we increased our spend by 52% from 2020. However, 3% of addressable spend went to women-owned businesses, short of our 5% goal. In 2022, we are redoubling our efforts to increase supplier diversity. Diverse supplier spend As a percentage of total addressable spend with suppliers that we do business with directly (Tier 1). Diverse supplier spend Women-owned Small businesses 1 Refers to Moody's Corporation and its wholly-owned subsidiaries. 2019 2020 2021 10% 8% 7% 0.3% 4% 3% 1% 1% 2%#36A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 36 CREATING AN ETHICAL SUPPLY CHAIN¹ We expect our vendors, suppliers, contractors and consultants to share our commitment to the highest ethical standards and operate in compliance with applicable laws, rules and regulations, including all anti-bribery and anti- corruption laws. All suppliers are asked to adhere to the standards set forth in our Supplier Code of Conduct, which was expanded in 2020 to reflect new social and environmental considerations and describes our expectations of suppliers in the areas of business integrity, labor practices, employee health and safety, diversity and inclusion and environmental stewardship. Our suppliers and other external stakeholders are encouraged to raise concerns or suspicions of violation of the Supplier Code of Conduct by contacting Moody's directly or via Moody's Integrity Hotline. For more on our reporting mechanisms, see Ethics and Integrity. In addition to these policies, our Modern Slavery and Human Trafficking Statement is updated annually and describes our approach to preventing human rights violations in our workforce and supply chain. Our supplier agreements include language that requires suppliers to ensure there are no human rights violations in their supply chains. As part of our due diligence process, we evaluate and segment all new suppliers based on criticality and risk, and we screen all key suppliers² with Compliance Catalyst, a Moody's Analytics tool powered by the Orbis and Grid databases on private companies. We assess a broad spectrum of risks, including U.S. sanctions, modern slavery, human rights violations and environmental crimes. In addition, we have put in place a clear escalation pathway to ensure we can address any major risks in an immediate and appropriate manner. Where possible, we quantify ESG risks - such as supplier diversity, science-based targets, cybersecurity and compliance with global ethical standards - and aggregate this data into an overall scorecard to track our priority vendors. To date, we have assessed 100% of our key suppliers and have not identified any high-risk suppliers. For more information on our policies regarding responsible sourcing, see Additional Resources. 1 Refers to Moody's Corporation and its wholly-owned subsidiaries. 2 Key suppliers are those deemed highest criticality by Moody's in terms of regulatory impact as well as high priority software suppliers.#37A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 37 Cybersecurity and Data Privacy' We are committed to developing and maintaining a best-in-class information security program that addresses cybersecurity and data privacy, including for our customers' data. We continuously work to enhance our policies, processes and technology to strengthen our cyber resilience and protect the data and security of our stakeholders. CYBERSECURITY GOVERNANCE AND RISK CULTURE Chaired by the Chief Information Security Officer (CISO), our Cyber Enterprise Risk Management Committee is responsible for identifying cyber risks and threats, recommending mitigating actions to strengthen cyber resilience and meeting risk tolerance thresholds established by executive leadership. The full Board of Directors and the Audit Committee receive regular updates from the CISO and Chief Information Officer (CIO), with escalations to the Board handled through the executive leadership team. EMPLOYEE TRAINING AND AWARENESS Cyber resilience starts with our people and our culture. In 2015, we enhanced our information security training and awareness program by launching InfoSafe for all employees, vendors and wholly-owned affiliates that are fully integrated with Moody's systems. The program aims to prevent, detect and respond to cyber threats and incidents, and consists of a number of initiatives, including: » Recertification of our IT Use Policy; » Continuing education on phishing awareness; » » Regular communications about cybersecurity best practices; and Annual events, like Cybersecurity Awareness Month. Our employees are required to complete annual cybersecurity training, and compliance is monitored. We use general and targeted phishing simulations to help our employees better recognize and respond to potential threats. The training program is further enhanced by inviting cybersecurity experts to scheduled educational events. We also offer specialized training modules on emerging cyber threats for our software development teams. Our IT Use Policy outlines a clear escalation process that requires employees to immediately report any suspected cybersecurity incident to the IT Help Desk. CYBERSECURITY MONITORING AND ASSESSMENTS Our cyber environment is continuously monitored by automated tools and an expert team that reviews alerts and incidents. Our Information Security Incident Response Plan provides governance and guidance in responding to information security incidents and is reviewed at least annually to ensure optimal calibration against existing and emerging threats. In 2021, we completed the implementation of the Security Operations Center, which was previously identified as an opportunity for improvement. We have a mature cybersecurity program internal review strategy. In addition to the annual assessment of the program and its components, robust vulnerability assessment processes are in place, as well as penetration testing, red teaming, tabletop exercises and phishing drills conducted by internal and external teams. Results are continuously measured and assessed for possible improvements. We contract reputable third parties to conduct annual external assessments of the cybersecurity program and its components. In 2021, these independent assessments included CoalFire and Trace3. Similarly, governmental agencies and their contracted agents conduct regular reviews in jurisdictions where we operate. Furthermore, insurance agents, clients and other market participants continually assess our security posture for their own needs. There were no material incidents² related to data and cybersecurity breaches across our global operations in 2021. Please see our Privacy Policy to learn more about our approach to customer privacy. 1 Refers to Moody's Corporation and its wholly-owned subsidiaries. ² A material incident is defined as "affecting critical systems or information with potential or confirmed significant impact to revenue, reputation or customers."#38A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 38 DATA PRIVACY AND PROTECTION We are improving our organizational and technical policies to ensure that we comply with changing data privacy laws and protect personal information. For example, we implemented Single Sign-On across multiple platforms to give us more control and visibility into potential threats. We updated our Privacy Policy to highlight existing protections, including how we would handle requests for personal data from domestic or foreign government or public authorities. The policy explains how we collect personal information; how we use, disclose and protect such information; and the choices our customers have concerning use of such data. We have a dedicated data subject rights process, and all data is safeguarded based on requirements and controls determined by our Information Risk & Security team. We require key vendors to complete security assessments and execute appropriate terms to their vendor agreements if they process personal data controlled by Moody's. Security controls, including access and right- of-use controls, are periodically evaluated by Internal Audit and external auditors on a product-specific basis. All employees must protect confidential information they receive in the course of performing their job responsibilities. Protecting confidential information helps us to fulfill our legal obligations and helps to encourage customers' good faith disclosures. Data privacy training is mandatory for all of our employees at onboarding and periodically thereafter, and we also offer additional role-based training and guidance for teams that regularly handle personal data. Employees who inappropriately disclose or otherwise misuse confidential information may be subject to disciplinary action up to and including termination. For more information, see our Code of Business Conduct. For more information on our policies regarding cybersecurity and data privacy, see Additional Resources.#39A MESSAGE FROM OUR 2021 SUSTAINABILITY PRESIDENT & CEO HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 39 BETTER 888 LIVES Diversity, Equity and Inclusion Employee Training and Upskilling Employee Health and Well-being Communities#40A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 40 40 Better Lives We aim to create a forward-thinking, inclusive culture for our people and communities. We strive to foster a diverse, equitable and inclusive workplace where every individual can thrive, and we empower the communities we serve with financial knowledge, educational opportunities and the skills of tomorrow. In 2021, we continued to take concrete steps to further strengthen our approach to diversity, equity and inclusion (DE&I) at every stage of our employee lifecycle, while also extending this philosophy to our community engagement initiatives. For more than a decade, it's been clear to me that Moody's is a special place. Even as the world navigates through an era of uncertainty, at Moody's we know who we are and what we stand for, and we have a clear path for the journey ahead. I am honored to work here, particularly after witnessing Moody's growth as a company and the company's continued commitment to our core values. Our people are crucial to our business, and we are committed to offering our employees opportunities to learn, grow and bring their whole selves to work. In 2021, we affirmed our commitment to thrive by moving to a single performance management approach - Grow, Perform, Succeed (GPS) — that enables our employees and leaders to own their professional development and navigate their careers at Moody's. We also launched Moody's University, a new unified framework for delivering learning and development across the organization. I'm excited to watch these initiatives expand and evolve over the coming months and years. This past year we took concrete steps to enhance our diversity, equity and inclusion practices, both within our organization and in our broader communities. We continue to tie DE&I priorities to our business strategy and define its importance to our collective success — including equitable and fair compensation for our workforce. Our eight business resource groups offer employees with like backgrounds a chance to connect and participate in robust programming. Moody's people are smart, resilient and passionate — and with their partnership, we can build a diverse, equitable and inclusive workplace where every individual can thrive. There is still work to do, and I am excited to see where the organization can go from here by harnessing the incredible momentum we've built. We understand our responsibility outside the four walls of our business to empower our communities by doing what we know best and working together toward a healthier future. This commitment is woven into the fabric of the company and its culture. Thank you, Maky Maral Kazanjian Chief People Officer#41A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 41 Diversity, Equity and Inclusion We believe a workforce that represents an array of backgrounds and experiences helps create an environment that maximizes every employee's contribution, widens the leadership pipeline and enhances our work, including the quality of our opinions, products and services. We aspire to be a place where everyone feels comfortable bringing their authentic self to work, where we demonstrate empathy and civility and where we celebrate the differences that make us stronger. >>> Hear more from DK Bartley, Chief DE&I Officer miT 76W 160 آن#42A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 42 OUR DE&I STRATEGY IN ACTION Our global DE&l strategy aims to drive a culture of diversity, equity and inclusion across four key areas: our workforce, workplace, customers and communities. The framework aligns to our company's business priorities, talent strategy, culture and long-term value proposition, and provides a structured approach to advance our DE&I strategy and goals. In 2021, we advanced our ambition by more deeply integrating DE&I into our business strategy and defining its importance to our collective success by developing and tracking specific KPIs. We are holding our leaders accountable for communicating and progressing on our DE&I goals. We aim to be an organization that demonstrates leading corporate citizenship at every level, challenges the status quo and is fair to all. We announced public diversity goals in 2021 to increase the number of women at officer and entry levels globally, and Black and LatinX leaders at senior levels in the U.S. We met and, in some cases, exceeded these diversity goals and are examining additional steps we can take to continue to increase diversity in our company. Global diversity strategic framework Structured approach to drive a culture of diversity, equity and inclusion Workforce |||||| MOODY'S Americas - U.S. – EMEA – APAC Workplace блюб Do Customers Community Business Resource Diversity Council Diversity Training Partnerships Supplier Diversity Groups Talent Acquisition - Performance Management - Retention#43A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 43 Setting our direction: DE&I governance Our employees actively participate at every step of shaping and implementing our DE&I strategy. Our global Executive Diversity Council (the Council) is tasked with overseeing the implementation and progression of our DE&I strategy and goals across our business. Chaired by our CEO and composed of senior leaders who are committed to DE&I best practices, the members of the Council meet quarterly so that DE&I policies are an ongoing focus throughout the company. Council members typically have a personal connection to DE&I or have been involved with one or more of our Business Resource Groups (BRG). Our Regional Diversity Councils in EMEA and APAC provide valuable guidance and ensure our strategy is effectively adapted and implemented in ways that are authentic and resonate with local policies and customs. In addition, our Regional Advisory Committees, made up of BRG co-chairs, serve an important role by facilitating rich discussions, seeking employee feedback and providing inputs to inform DE&I programming. At the center are our BRGs, tasked with implementing and advancing our DE&I agenda with active participation across the organization. Over the past few years, the Council has helped us make significant progress: » Developing and implementing workplace flexibility; » Broadening diversity and inclusion education programs; » Championing and expanding our BRGs; and >>> Establishing the Women in Leadership programs. EMEA COUNCIL Diversity Strategy Executive Diversity Council E G P MOODY'S ENABLE BRG MOODY'S MOODY'S MOODY'S MOODY'S MOODY'S MOODY'S MOODY'S GENERATIONAL INCLUSION MINDS MULTICULTURAL PRIDE VETERANS WOMEN'S BRG BRG BRG BRG BRG BRG BRG Wellness Regional Advisory Committee Belonging Regional Advisory Committee Communications Regional Advisory Committee Benefits Regional Advisory Committee Talent Acquisition Regional Advisory Committee ERGs to BRGS APAC COUNCIL Regional Advisory Committee#44A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 44 Empowering our people: Business Resource Groups Our BRGs help create a meaningful space for employees to express their values, shape business initiatives and programs and bring their authentic selves to work. Each of our eight BRGS works closely with our Diversity Council and plays a role in advancing DE&I at Moody's. Our 44 regional chapters across the Americas, EMEA and APAC represent the many diverse talents within the company and help make our workplace representative of the communities in which we operate. With more than 6,600 BRG members globally', each group is led by a chair, who is nominated by the group and ultimately appointed by our Chief DE&I Officer. Due to the strategic role our BRGs have in our decision- making process for recruitment, retention and professional development, we are now in the process of transforming three of our inclusion groups - Asian Leadership Initiative (ALI), Black Inclusion Group (BIG), and ConectaMos (our Latinx group) - into stand-alone BRGs. This transition will help bring diverse perspectives in shaping our business initiatives and programs. For more information on how the work of our BRGs is integral to activating better lives for our employees and communities, see pg 49, 52, 54 and 64. 1 Data as of December 31, 2021. An employee can hold membership in multiple BRGs in a single region. Our BRGs E MOODY'S ENABLE: advocates for an inclusive, accessible and stigma-free workplace in which employees with disabilities are valued for their talents and have the opportunity to advance and thrive professionally. MOODY'S MINDS: seeks to foster a culture where all employees are empowered to discuss and manage their mental health. MOODY'S VETERANS: recognizes and supports veterans, active-duty military personnel and military families both within our company and in our communities. Members primarily focus on outreach efforts, including workforce integration and raising awareness around issues that affect veterans. G MOODY'S GENERATIONAL: seeks to leverage the insights and experiences of our multi-generational workforce in order to cultivate an inclusive work environment that fosters greater connectedness, supports the development of all generational groups and delivers business value to the firm. MOODY'S MULTICULTURAL: seeks to leverage diverse talent by promoting recruitment, professional development and networking opportunities for all ethnically diverse employees at Moody's. MOODY'S WOMEN: seeks to enhance the recruitment, retention, promotion and professional development of female professionals by implementing programs that foster greater interaction among peers, as well as the broader community, while acting as a collective voice for raising women's issues to senior management and enhancing the employment brand. Y'S DIVER MOODY'S INCLUSION: supports all areas of diversity and inclusion combining Moody's BRG chapters. Inclusion creates opportunities for all employees regardless of office size to engage with a BRG. MOODY'S PRIDE: advocates for a work environment that respects, welcomes and supports lesbian, gay, bisexual and transgender professionals and enables them to perform to their fullest potential and contribute to the greater goals of the firm.#45A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 45 INSIDE MOODY'S: OUR WORKFORCE AND WORKPLACE We believe that an inclusive, equitable and diverse workplace that draws on the experiences, backgrounds and opinions of all its people is fundamental to our success. Our business benefits from having many different perspectives. That is why we actively promote diversity at every level of Moody's. We work hard so that all employees, from senior leaders to new hires, feel respected and are included and empowered. Global employee breakdown by region Number of employees 764 679 4,197 3,429 4,234 3,665 3,145 Americas (excl. U.S.) APAC EMEA U.S. 2020 2021 4,834 Full-time 13,202 | Part-time 258#46A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 46 Who we are: race, ethnicity and gender data Disclosing our diversity data is critical to holding our organization accountable in the efforts to build an inclusive workforce. We are continually challenging ourselves to provide transparent reporting and look forward to identifying ways to enhance our disclosure practices. We made our 2020 consolidated U.S. Equal Employment Opportunity (EEO-1) data available to the public for the first time. In addition, we are disclosing our EEO-1 data for the second consecutive year, which can be found in the Appendix. While we recognize that EEO-1 data is not a perfect measure of diversity, it is a step towards our efforts to increase transparency and foster an inclusive workplace. Global gender diversity 1.2 % female of global workforce population 41% 33% 33% 37% 48% 30% 2019 41% 33% 33% 33% 2020 37% 49% 41% 39% 49% Race and Ethnicity of U.S. Employees % of employees 32% 32% 31% 45% 2021 Executive Mid Level Manager Senior Manager First Level Manager Non Manager Overall 1 The data by seniority represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies for which this data was not available). The total breakdown by gender represents the full employee population. Headcount as of December 31 of the respective year. 2 Executives represent CEO, CEO-Direct, Exec Directors, GMD, SMD and MD level; senior managers represent AMD, Country Head, SVP and Senior Director level; mid-level managers represent VP-SCO, VP-SA, VP and Director level; first-level managers represent AVP-Analyst, AVP, Associate Director and Assistant Director level; non-managers represent Analyst, Assoc Analyst, Assoc and Associate level. 3 Officers and Managers are calculated using the job categories: executives, senior managers, mid-level managers and first-level managers. 4 Underrepresented groups include employees who identified as Asian, LatinX, Black, Native American / Alaskan Native, Hawaiian / Other Pacific Island or two or more races. 43% 2021 6% U.S. Workforce 4% U.S. Officers and Managers³ 49% 53% White Underrepresented groups4 Not disclosed#47A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 47 Advocating for equal pay We are committed to paying all of our employees equitably and fairly. We study pay equity annually to identify any areas in the company where women or, in the U.S., racial/ethnic underrepresented groups, are not paid comparably to their peers. While no statistical analysis can account for all things that influence an employee's pay, we consider meaningful factors such as job family, location, educational level and seniority. When we find inequities in our pay practices, we make the requisite adjustments. Each year we report our findings to our Board of Directors. We are proud to share the progress that we have made. While we are proud of this relative parity, we are by no means satisfied. We know that pay gaps constantly fluctuate for many reasons including changes to our business and employee movement in and out of the organization. Therefore, we are committed to dedicating the resources necessary to maintain pay equity and to drive pay decisions based on legitimate factors. To date, we have progressed on our pay equity efforts for women globally and for Black and LatinX employees in the U.S. 1 As of April 1, 2022. The population studied includes employees eligible for Moody's compensation programs and excludes limited duration employees, non-employees, temporary workers and employees from companies acquired in 2H 2021. Employees from V.E and Four Twenty Seven were excluded from the analysis due to not being integrated into Moody's compensation programs at the time of the analysis. This exclusion is non-material and represents 3% of employees. 2 For every $1 earned by comparable men. 3 Defined as LatinX, Black and Asian. 4 For every $1 earned by comparable white employees. Pay equity by the numbers¹ $0.99 $1.01 earned by women globally² earned by non-white³ employees in the U.S.4 $0.99 $1.00 earned by Latinx employees in the U.S.4 earned by Black employees in the U.S.4 $1.02 earned by Asian employees in the U.S.4#48A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 48 Attracting diverse talent through inclusive recruiting¹ Our talent acquisition process embeds DE&I best practices at all stages through close collaboration with the hiring managers. We take a structured, objective approach to the interview process and employ the following practices: » >>> >>> Selecting a diverse interview panel to provide varied points of view during evaluation; Leveraging diverse recruiting tools and job boards to build a robust talent pipeline; Presenting diverse slates of qualified candidates for our open positions; >>> >>> » Establishing consistent interviewing practices, including the use of behavioral-based interviewing techniques, to reduce the possibility of unconscious interviewer bias; Formalizing feedback collection by using consistent rating scales to promote objective feedback on candidates, while reducing the possibility of unconscious interviewer bias; and Holding debrief meetings where the most junior interviewer on the panel provides candidate feedback first and the hiring manager last, to ensure an inclusive process where all voices are heard. In 2021, we implemented several new recruiting technologies, such as an augmented writing tool that helps our recruiters create job postings that use inclusive language to enhance our diverse candidate pipeline. We also partnered with PowerToFly and Fairygodboss to host a series of opportunities for our women employees to share their experiences in virtual career fairs, provide career advice and network with other women in technology. We welcomed 119 summer interns from around the world in 2021. some of whom connected with us through organizations we partner with, including Girls Who Code, ELC Scholars and Bridging the Gap. Below is the geographical breakdown of our 2021 summer intern class. AMERICAS 63 APAC EMEA 26 30 RE-IGNITE RE-IGNITE is our 16-week paid return-to-work opportunity for mid-to-senior-level individuals who are restarting their careers after a minimum two-year hiatus. Professionals who wish to return to the workforce after time away have access to hands-on project work, leadership development and networking opportunities, as well as visibility into our unique culture. Together, these components can help prepare individuals for a successful return to the workforce. In 2021, we expanded the program to the U.K. and transitioned from annual to year-round admissions. Since the RE-IGNITE program began in 2017, 80% of participants have become Moody's employees. 1 Refers to employees hired to be on Moody's payroll.#49A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 49 Bolstering our employee inclusion training¹ Creating a culture of inclusion and belonging is expected of all leaders at our company — and that was the driving force behind our Inclusion Evolution employee training program. In 2021, people managers attended the 3.5-hour instructor- led classroom experience that focused on two critical components: Understanding ourselves and the social context that creates our identity; and Building a culture of inclusion by exploring unconscious bias, empathy and belonging and by advocating for others. After the program, participants were given additional access to eLearning courses and toolkits to build a culture of inclusion in their own teams. We also offered an abbreviated virtual program to all employees starting in 2021. COURAGEOUS CONVERSATIONS We encourage all employees to be upstanders, not bystanders, when they see or hear someone being treated differently based on their race, gender identity, ethnicity, sexual orientation or any other protected characteristic. To aid in these efforts, we created Courageous Conversations, a series of discussions hosted by our BRGs. What began as a dialogue on racial unrest has evolved to include discussions about inclusion, mental health and other topics that may be sensitive but are long overdue. This series aims to facilitate discussions on difficult topics and provide employees with the tools necessary to talk to and learn from each other. » >>> CONFRONTING ANTI-ASIAN BIAS: In partnership with the Multicultural BRG and Asian Leadership Initiative, we created the Moody's Courageous Conversations Upstander Toolkit: United Against Anti-Asian Bias. It contains information on how to support members of the Asian and Pacific Islander communities in the face of racism by actively confronting racial bias and prejudice. The toolkit also serves as a guide for fostering productive conversations and allyship in the workplace, with resources that focus on the lived experiences of Asian-Americans to foster better understanding of anti-Asian and Pacific Islander racism. SUPPORTING WOMEN THROUGH LIFE'S MILESTONES: We also piloted a "Menopause in the Workplace" program to support our female employees and equip colleagues with information on this life milestone. We expect to roll out the program globally in 2022. "When I first saw that Moody's was doing a pilot on menopause in the workplace, I was delighted that this was being recognized - having worked in Moody's for almost 25 years and having gone through several phases of life while being a part of the company, including menopause. As a manager of 10 people, I am quite open with my team about my symptoms and feelings in the hope that they feel comfortable to talk about it if they choose to, so I can give them the support they need." - Jenny Lacey, Associate Director, Resourcing & Operations 1 Refers to employees on Moody's payroll.#50A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 50 Working toward Black equity We were one of the first companies to commit to achieving the new Management Leadership for Tomorrow (MLT) Black Equity at Work Certification in 2020. Since then, we have been taking concrete steps to accelerate Black representation across our business and create new and innovative ways to invest in and contribute to racial justice efforts. MLT In early 2022, we announced our participation in MLT's "All In" campaign, an initiative that provides industry-leading employers with a platform to articulate their commitment to a rigorous approach to Black equity while encouraging others to sign on to the MLT Black Equity at Work Certification. Through our participation, we hope to inspire our peers and others to implement the demands of the certification in order to meaningfully progress on racial equity issues in the workplace and in our communities.#51A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 51 Supporting Black equity in our communities We are proud to continue our five-year commitment to provide $1 million to non- profits advancing Black equity. With five U.S. organizations and seven international organizations slated to receive these funds, we hope to improve equity and inclusion for Black communities around the world in several ways: » Supporting groups that advocate for social justice; » Supporting Black and Brown entrepreneurs; INVESTING $1 MILLION IN BLACK EQUITY We committed $1 million to advance equity and inclusion for Black communities around the world through these organizations: U.S. ORGANIZATIONS >>> Big Brothers Big Sisters of America Eagle Academy Foundation INTERNATIONAL ORGANIZATIONS >>> Black Business and Professional Association >> Black Women in Motion >>> Blueprint for All >>> National Association for the Advancement of Colored People (NAACP) >>> Education Africa >>> European Network Against Racism >>> Harambee >>> Equal Justice Initiative >>> >>> Creating new internship opportunities, including for Black and Brown students; Pushing initiatives to improve inclusion in company operations; and >>> Advancing opportunities for Black and Brown professionals to obtain C-level positions. Our own employees - the members and leaders of the Black Inclusion Group - are involved in the distribution of these funds, making our commitment to improving social justice, equity and opportunities for Black people all the more personal. The United Negro College Fund (UNCF) is one of the organizations we support. In our efforts to make education more accessible to underrepresented communities, we work with UNCF to sponsor eight college students over three years, helping more Black students obtain their college degrees. To read more about our community support to other minority groups, see Communities. >>> United Negro College Fund (UNCF) DK Bartley, Moody's Chief DE&I Officer, and Patrick Hutchinson, co-founder of UTCAI, during UK Black Business Week >> United To Change and Inspire (UTCAI) "UNCF is grateful to have corporate partners like Moody's that are helping us uplift Historically Black Colleges and Universities and ensure that more young people of color can reach their fullest potential... With such partnerships, we can work together to realize UNCF's vision of a nation where all Americans have equal access to a college education." - Diego Aviles, Vice President, Northeast, UNCF#52A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 52 Building the pipeline of diverse talent We are committed to building an inclusive pipeline of diverse leaders and empowering them to make impactful contributions to the markets and communities they serve. Ray McDaniel Scholarship The Ray McDaniel Scholarship is a five-year, $1.2 million program to provide 30 three-year scholarships to high- achieving undergraduate Black students. In summer 2021, the first cohort of Ray McDaniel scholars joined us for a virtual internship in which they completed a case study and presented their findings to our senior leaders. After the students graduate, they receive job opportunities with Moody's. Moody's Veterans Program Moody's Veterans Program is a partnership between our Veterans Business Resource Group (VBRG) and Columbia University to prepare veterans for careers in finance, technology and economics. In 2021, five scholars joined the program and each received $10,000 to support their studies during the 2020-21 academic year. Scholars also had the opportunity to participate in our summer internship program, as well as a mentorship program involving our VBRG. Queer Coders program Through our partnership with Hetrick-Martin Institute we support Queer Coders - a program that provides professional development and technical training to lesbian, gay, bisexual, transgender and queer or questioning (LGBTQ+) youth aged 18-24. In 2021, Queer Coders expanded outside of New York City to offer a second national cohort in the U.S. Members of Moody's New York Pride BRG provided mentoring to the 2021 Queer Coders cohort to help the students develop their interviewing skills. "Moody's is committed to recognizing and supporting veterans, active-duty military personnel and military families both at Moody's and in our communities. We are thrilled to welcome our 2021 cohort of scholars through MVP, which helps student veterans reach their potential and drives a diverse talent pipeline." - Helene Gurian, Chief Compliance Officer & executive sponsor of the VBRG#53A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 53 Propelling diverse talent forward Our dedicated talent accelerator programs aim to foster an equitable, inclusive environment. TIDE In 2020, we launched TIDE (Talent Aspirations & Alignment, Insights, Development & Career Planning and Exposure & Expansion), a nine-month career-development program aimed at advancing the careers of women, LGBTQ+ employees, people of color, veterans and neuro-diverse employees. Through TIDE, our diverse, talented individuals gain greater visibility across the organization and cultivate relationships with leaders who provide support and mentorship during their career journey, in addition to robust and individualized professional development resources. "As a member of the first TIDE cohort, I became more deliberate about mapping out the next chapter of my career, and it solidified my commitment to Moody's, helping the company grow and continue to be an employer of choice." The first cohort of 25 TIDE participants graduated from the program in 2021. The outcomes of our pilot program highlight the impact of TIDE for individuals and the organization as a whole. The second TIDE cohort will convene in spring 2022. 96% retention rate of TIDE participants as of the publication of this report. 90% of participants agree or strongly agree their career ambitions can be fulfilled at Moody's. 90% of participants agree or strongly agree that TIDE is a key part of our commitment to DE&I. - Alicia Gordon, VP, Senior Compliance Officer 80% of participants agree or strongly agree they are more aware and vocal about their career ambitions. 80% of participants agree or strongly agree they have expanded their internal networks.#54A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 54 Senior Women's Leadership Development Program Our Senior Women's Leadership Development Program - which was founded in 2014 to bring together senior female employees for mentorship, coaching, training and networking opportunities - was transformed and expanded in 2021. The latest cohort comprised 37 senior women who participated in sessions designed to enhance their leadership presence and build influence with key stakeholders, among other objectives. The next cohort will launch in spring 2022 under a new name, RISE. The Senior Women's Leadership Development Program 2021 graduates saw 90% retention, and 26% of participants received promotions. 100% of survey respondents would recommend the program to other women at Moody's. BRG-led mentorship programs We are extremely proud of our BRG-led mentorship programs, where peers can gather to engage with leaders and one another to further their professional development. » >>> » The Asian Leadership Initiative (ALI) mentoring program celebrated its fifth year in 2021 - and saw a 50% increase in participation over 2020, with 27 mentor pairings finishing out the program. In an end-of-program survey, 72% of respondents said they found the monthly topics useful for sparking discussions in pairing, and 100% of respondents would like to return to the mentoring program next year. In 2021, the Women's BRG (WBRG) mentorship program celebrated 10 years of mentorship and career growth. Since the launch of the initiative, the program has reached over 700 mentees, 116 mentors and 14 mentor advisors. Conecta Mos, an initiative of the Multicultural BRG that focuses on LatinX leadership, offers a mentorship program that pairs mentors and mentees to discuss career goals and advancement strategies. SUPPORTING OUR LGBTQ+ COLLEAGUES AND COMMUNITY BE COUNTED As we continue to expand our data disclosure practices, we launched the Be Counted initiative in 2020 in the U.S. This initiative asked U.S. employees to voluntarily self-identify as members of the LGBTQ+ community. Our senior management and Board of Directors received the data in an aggregated and anonymized form. We are using the data to review and boost leadership development programs, recruitment, employee benefits and more. L'AUTRE CERCLE CHARTER In January 2022, we took another step toward formalizing our support of the LGBTQ+ community in France and on a global scale by signing the L'Autre Cercle Charter. The charter focuses on creating an inclusive environment, ensuring equal rights and treatment for employees, supporting employees who are targets of discrimination and measuring progress and sharing best practices to enact change in the workplace. We are excited to join the other signatories in a shared commitment to support all employees, regardless of sexual orientation or gender identity. 1 As of June 2021. MOODY'S INVESTORS SERVICE Signing of the L'Autre Cercle Charter To read more about our workplace DE&I programs, visit our DE&I microsite. To learn more about benefits to support our workforce, including parents, military service members and young professionals, see Employee Health and Well-being.#55A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 55 OUR CUSTOMERS Through our products and research, we give confidence to decision-makers across financial markets worldwide. We are harnessing the trust that we have built for over 100 years to provide valuable insights into ESG, of which DE&I is an important component. Creating Opportunities for Racial Equity Our DE&I initiatives encompass our entire value chain of customers and institutions. That's why in 2021, we laid the groundwork to transition the Moody's Multicultural Customer Initiative (MMCI) into our Creating Opportunities for Racial Equity (CORE) program. MMCI, and now CORE, aim to develop partnerships, share expertise, invest capital and utilize software and services to assist community development financial institutions (CDFIs), minority depository institutions (MDIs), diverse finance companies and diverse asset managers. Progress on our customer initiatives 969 DIVERSIFIED DEPOSITS We have deposited a cumulative $10 million in treasury deposits in Black-owned banks as of December 31, 2021. DEVELOPED PARTNERSHIPS Our scaling efforts have included multiple meetings, conversations and webinars with multicultural stakeholders such as banks, asset managers and potential partners. SHARED EXPERTISE From regional economic reports to our research on racial integration, we have shared reports, authored articles, briefed boards and executives and provided critical business data. INVESTED CAPITAL Moody's has invested $5 million in Trident's fund - focused on equity investments in small / minority- owned businesses - and became a member of its advisory board.#56A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Equity opportunities in action. CORE began with deposits in four CDFIs in fall 2020. Since that time we have expanded the program's scope by developing partnerships and sharing expertise with multicultural stakeholders. In addition, we invested in Trident, an institutional asset manager that supports underserved small businesses in the U.S., particularly in Black communities. We intend to continue expanding the program over the coming years and look forward to taking specific measures to engage, empower and invest in underserved communities. Our CORE roadmap PILLAR 1. ENGAGE Moody's 2021 Stakeholder Sustainability Report 56 "Having the right partnerships with organizations like Moody's allows Trident to identify and invest in Main Street small businesses, where other firms may not believe opportunities exist. The result is better returns for investors, better outcomes for underserved communities, and better chances for overlooked entrepreneurs to achieve the American Dream." 品 2. EMPOWER Strategic Themes Broaden CORE's outreach, both internally and externally, and communicate Strategic education on Moody's capabilities, portfolio and overall products Long-term global growth and scale - Eric Taylor, Founder, CEO & CIO, Trident 3. INVEST A Leverage a streamlined and efficient cross- company approach Provide more access to and understanding of how to leverage capital#57A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 57 Gender and Finance Research Hub During Women's History Month in February 2021, we launched the Gender & Finance Research Hub with research collected from across the different business segments at Moody's. Our research shows and reinforces the impact of gender equality across sectors and countries globally. For example, in celebration of International Women's Day, we published our Breaking the Bias report in March 2022. This report highlights why narrowing global gender gaps helps create a more sustainable, inclusive workplace and is an economic, business and financial imperative. For more information on our policies regarding diversity, equity and inclusion, see Additional Resources. Key findings from the 2022 report include: >>> ECONOMY: Implementation of family-friendly policies, such as those in other developed countries, could boost U.S. GDP growth by almost $1 trillion in the next 10 years. >>> CORPORATE ACTION: No corporate sectors achieved management-level gender parity in 2020 and almost half of all sectors have management teams averaging less than 25% female. >>> >>> CREDIT RISK: Board-level gender diversity is correlated with higher credit ratings. Our data shows that women represent 35% of the boards of the companies with positive governance characteristics, while women hold only 21% of board seats at companies with highly negative governance features. SUSTAINABLE FINANCE: Debt instruments earmarked for financing of projects tied to the advancement of gender equality have grown steadily, with about $22 billion issued in 2021 and a cumulative $70 billion since 2016.#58A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 58 Employee Training and Upskilling Attracting and retaining the right talent is paramount to our success. As a global integrated risk assessment firm, a critical component of our talent attraction and retention strategy is to invest in our people at every stage of the employee life cycle to build an adaptive, engaged, diverse and inclusive workforce. In 2021, we moved to a single performance management approach - Grow, Perform, Succeed (GPS) — that enables our employees to more effectively own their professional development and navigate their careers at Moody's. We also created Moody's University (Moody's U) — a new unified framework for delivering learning and development across the organization, which launched in 2022. TRAINING THE WORKFORCE OF THE FUTURE We are committed to helping our employees and leaders develop the skills they need to thrive — both today and in the future. We provide employees with ongoing learning and development opportunities that begin with onboarding and continue throughout their careers. In 2021, we made numerous acquisitions, restructured our business units and redefined our working norms and assumptions through our Workplace of the Future initiative. These developments call for re-skilling and upskilling our workforce — all in the midst of challenging external currents that are shaping today's talent landscape. Therefore, led by our newly appointed Chief Learning Officer, we are transforming our learning and development function to align more closely to our business objectives and the continuously evolving needs of our customers, employees and stakeholders. 1 Refers to employees on Moody's payroll. Isotypes#59A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 59 MOODY'S U Moody's U offers employees and leaders training on enterprise-wide skills, leadership development, business-specific technical skills and core capability development. Moody's U is expanding its training programs to the following areas: » » » » Enterprise Skills Academy is responsible for developing essential professional skills for all employees; Leadership Academy develops manager and leader learning solutions that focus on supporting our leaders to be more change-ready, resilient and agile in an increasingly complex environment; MA Academy, with its dual focus on people and products, helps drive the establishment of "vocation" by aligning learning to job families; and MIS Academy rolled out global support of Lean Six Sigma literacy, ESG training and certification. Our training in practice MOODY'S-WIDE LEARNING LEADERSHIP ACADEMY BUSINESS-SPECIFIC LEARNING ENTERPRISE SKILLS MA ACADEMY ACADEMY CAPABILITY DEVELOPMENT GPS & organizational effectiveness Onboarding ESG Compliance DE&I MIS ACADEMY Technology Change management Well-being GOVERNANCE, MEASUREMENT, DESIGN AND DEVELOPMENT LEARNING TECHNOLOGY & INNOVATION#60A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 60 Business Learning Councils align learning priorities across Moody's To operationalize our learning and development strategy and identify priorities aligned to business objectives, we launched Business Learning Councils (BLCs). BLCS are chaired by learning leaders and council membership comprises business unit leaders. BLCs serve as a crucial two-way communication channel between the centralized learning function and each business unit. The BLC leadership team is responsible for: » » Driving the learning and development strategy and facilitating Moody's U; Developing and implementing operational plans; Recommending buy vs. build options for learning and development programs; and Driving reporting and metrics methodology » and infrastructure. Leadership development programs Building a strong leadership pipeline is paramount to our company's continued success. Key elements include: >>> » » >>> » Strategic Alignment - Addressing business-driven needs, aligning learning and development solutions to advance our strategy as an integrated risk assessment organization and building the skills of the future; Performance Management: Grow, Perform, Succeed - Aims to build a culture of growth by evolving career and growth conversations to cover not only what can be done to be successful, but also how to do it; Career Journey - Concentrating on growth and defining developmental pathways within the organization; Talent Acceleration - Building a strong talent pipeline, from early career opportunities to accelerating the development of high-performing diverse talent across Moody's; and Learning Culture - Driven by innovation and growth, to build a learning culture through content creation, delivery and measurement. 2021 LEADERSHIP PROGRAM HIGHLIGHTS >>> Virtual Leadership Essentials: Over 300 managers learned fundamental management skills and how to lead with self-awareness and personal effectiveness. >>> Leadership Insights: This program provided over 200 leaders with 360-degree feedback, development planning and optional virtual coaching. >>> Inclusion Evolution: People managers attended a 3.5-hour instructor-led classroom experience to focus on creating a more inclusive culture, where every employee feels like they belong. For more on our training and mentorship opportunities for specific employee demographic groups, see Diversity, Equity and Inclusion.#61A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 61 Business and skills-specific programs >>> » >>> » Cornell FinTech & Innovation Program: Our first cohort of 40 employees successfully completed this five-month program, developed in partnership with Cornell University, to further their understanding of fintech and develop leading innovation and ideation skills. Credit Academy: In 2021, over 250 junior MIS employees signed on to jump-start their skill development through Credit Academy, which includes onboarding, job readiness and career progression training across the full set of skills required of analysts. Sales training: We launched a comprehensive sales training program to support more than 1,200 sales professionals in developing industry, customer and product knowledge (including technical and security matters). Rotational programs: We launched a new rotational Data Science Development Program, and we are going to expand the two-year early-career MA Technical Rotation Program (MATR) to include opportunities for employees across Moody's. Employees pursuing higher education can also take advantage of educational assistance that reimburses them for job-related educational costs. See the Compensation & Benefits section for more information. ESG training To continue helping our customers solve the most complex problems of our time, we are training our employees with deep domain expertise in ESG in subjects like climate risk and new ESG developments in our solutions. In 2021, we published live and recorded trainings that covered risk assessments, EU Taxonomy, UN SDGS, ESG financial markets, green bonds, climate-risk scenarios and many more. In 2022, we rolled out an all-employee modular training on sustainability and ESG. Continuous improvement of our learning programs We evaluate the effectiveness of our learning programs through a number of approaches, including skills assessment tools, focus groups, surveys and needs assessments deployed at the individual, team and business- unit levels. The findings from these assessments help make the initiatives more useful and actionable. The needs assessments ask employees and their managers to evaluate: » The effectiveness of training for a variety of skill areas; Training by numbers The continued impact of the pandemic affected training activity. For example, average hours decreased, in part, due to non-essential training being paused or reduced to align with business objectives and prioritize employee well-being. Total number of training hours¹ 251,109 218,816 205,419 » The importance of a particular skill area in helping the individual or the business meet their objectives; and 2019 » Individuals' training modality preferences. For example, a new survey in 2021 gauged how often participants applied their learning from Leadership Essentials to their day-to-day work as managers. According to the survey results, 92% of graduates agreed the program was effective in providing them with tools and techniques they applied to their roles as leaders, and 97% of graduates' managers agreed the program effectively enhanced the graduates' leadership skills. 2020 2021 Average training hours¹ 28 21 21 21 20 17 2019 2020 2021 Officer Non-officer Training and development expenditure per employee $717 $676 2020 2021 1 Data includes hours captured in Moody's University and online training programs related to topics such as compliance, professional development and diversity, equity and inclusion. In addition, leadership development hours are included in 2020 onwards.#62A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 62 22 PERFORMANCE MANAGEMENT: GROW, PERFORM, SUCCEED In 2021, we adopted a single performance management approach - termed Grow, Perform, Succeed (GPS) - that emphasizes our commitment to employee growth and development. GPS encompasses all aspects of performance management—including dynamic objective setting, performance evaluations and continuous feedback. It allows employees to navigate their Moody's careers with a set of shared success factors and a qualitative rating scale that measures both business outcomes and behaviors. This drives business results and builds a culture of growth. As part of this effort, we have refreshed our core success factors - behaviors that are expected of all employees and leaders - and put in place clear and common definitions for evaluating business outcomes and behaviors. We delivered eight separate GPS training programs on the new GPS behaviors and approach, totaling 41 individual trainings globally. How it works Employees collaborate with their managers to set clear, measurable objectives that align with department and company objectives, and employees receive continuous feedback. At the end of the performance review cycle, managers and employees have a conversation focused on two key dimensions - both what the employees are expected to achieve and how they are expected to achieve it. Each dimension is given equal weight when determining the employee's overall performance rating. In 2021, 92% of employees received a performance and career development review via GPS. Incorporating diversity, equity and inclusion Our employees are expected to demonstrate a shared set of behaviors that contribute to a culture of growth and inclusion. As part of the GPS review, all applicable employees are evaluated on our Core Success Factors ― including "Authentic and Aware" (e.g., "Listens with empathy and genuinely cares for others") and "Collaborate with Purpose” (e.g., "Fosters an exchange of perspectives in an open-minded and inclusive manner" and "Listens effectively to hear and value different perspectives and viewpoints"). There are additional expectations and measures for managers. Managers are evaluated on the Leadership Success Profile- which includes "Empower and Develop Talent" (e.g., "Fosters an inclusive workplace that values diversity and promotes belonging and well-being"). In addition to being embedded in performance evaluations, these behaviors are also incorporated into our employee and manager development programs. For more on our DE&I programs, see Diversity, Equity and Inclusion. For more information on our policies regarding employee training and upskilling, see Additional Resources. SUCCEED OBJECTIVE Dynamic wo ONGOING DIALOGUE PERFORM DISCUSSION Evaluate, measure and reward GROW. ADJUST YEAR-END GPS SUCCEED CONTINUOUS FEEDBACK MID-YEAR CHECK-IN Connect, monitor and grow DEVELOP SETTING 1 Employees in a probation period or who joined Moody's from newly acquired companies do not participate in the GPS performance review process. Certain non-wholly-owned subsidiaries for which this data was not available are excluded from the analysis, therefore the data represents 76% of the total employee population. EXECUTE#63A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 63 Employee Health and Well-being We are committed to protecting the safety, health and well-being of all employees and individuals in our workplace, and expect our employees to take reasonable care to further those efforts. To this end, we offer our employees a comprehensive range of programs with resources and support for physical, mental and financial well-being, as well as support for flexible work arrangements. Our approach to employee health and well-being aims to: » >>> Create a workplace where employees feel valued and inspired; Provide an environment that fosters a culture of independence, inclusion and intellectual leadership; and Support peer collaboration and professional growth. We began developing a comprehensive, enterprise-wide well-being strategy, which will be implemented in 2022. The strategy places an even greater emphasis on holistic wellness and support as employees continue to operate in a hybrid work environment. We also continued our work to ensure the physical and financial health and safety of our employees and differentiate our compensation and benefits offerings to accommodate our changing environment. PLACING EMPLOYEE WELL- BEING AT THE CENTER OF HOW WE WORK As the COVID-19 pandemic continued to shape the lives of our employees in 2021, our wellness programs and initiatives aimed to address the psychosocial and mental health risks associated with lockdowns and the isolation that may result from working from home. Targeted support also aimed to meet employees where they are on their wellness journey and encourage greater work- life balance: » » No-Meeting Fridays: a number of teams participated in this program, which included coordinated holiday weeks or time off; Well-being allowance: received by all employees at year-end to use at their discretion to support mental or physical wellness; and Office equipment stipend: available to employees at the Assistant Vice President (AVP) level or below for furniture or peripherals to help improve their ability to work remotely. We continue to monitor the risk presented by the pandemic and emerging variants, and we remain ready to respond to protect the health and safety of employees. We supported global vaccination efforts by providing employees with time off to get themselves and their children vaccinated. OUR KEY 2021 WELLNESS SUPPORT INITIATIVES » >>> » Coronavirus intranet site: offers a wide variety of information to support employees, from access to employee assistance programs to tips for remote working. Global ergonomics program: online assessments and guidance helps employees set up their in-office and at-home workstations, including through our Moody's Moments that Matter series. International wellness days: we marked days such as World Mental Health Day on October 10 by providing a series of discussions, employee stories and information about accessing support. 1 Refers to employees on Moody's payroll.#64A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 64 Our global well-being strategy In fall 2021, we began work on a comprehensive global well- being strategy. The strategy is informed by an evaluation of the current state of wellness at our company through a combination of focus groups, stakeholder meetings, employee survey data and existing quantitative data. As a critical input into the creation and evolution of our strategy, several questions in our Business Engagement Survey of employees focus exclusively on evaluating individual well-being, including the ability to have work-life balance, understand priorities, feel a sense of belonging and perceive that Moody's cares about their wellness. Answers to these questions help further guide us in our strategy to protect employee well-being. In 2021, 76% of employees agreed Moody's took a genuine interest in their well-being. Moody's Moments that Matter A total of 26 sessions in 2021 attracted more than 8,500 views. In 2021, our virtual well-being series, Moody's Moments that Matter, continued providing employees with education and empowerment on mental health, resilience and thriving in an increasingly virtual world through articles, videos and weekly live webinars. Sessions are developed in close partnership with our BRGs to ensure topics resonate across employee groups. Webinar topics from 2021 included resilience, financial literacy, mental well-being and bullying, among others. Additionally, some BRGs hosted voluntary engagement events, such as online yoga and meditation classes, as well as health information webinars throughout the year.#65A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 65 80 76 16 MAKING CONFIDENT DECISIONS TO IMPROVE EMPLOYEE EXPERIENCE AND ENGAGEMENT Each year, we encourage our employees to provide anonymous and candid feedback through our Business Engagement Survey (BES). This survey helps us to: » » » Understand our employees' level of engagement at periodic intervals throughout the year (for example, through shorter, more frequent pulse surveys); Inform our actions through the use of a validated measure of engagement; Reinforce managers' roles to take action by dedicating specific resources to address opportunity areas identified by the survey results; and Assess employee sentiment around longevity and intent to stay, which helps us to frame actions that drive talent retention. Our 2021 employee engagement survey score was 73, compared to a global benchmark of 75 - measured by employees reporting how happy they are at Moody's and whether they would recommend working here. We use the feedback we received through the BES as a vital input into making decisions to improve our employee experience. At the same time, we are constantly looking to improve our employee experience and recognize that we can do more. While our employees are highly engaged, many are looking for better communication and transparency around change. The BES found that our employees appreciate the continuous performance review approach and regular check-ins, and some also expressed a desire for better infrastructure and more support to improve job effectiveness. Additionally, with continued business growth, employees are also seeking more career advancement and development opportunities - which we expect Moody's U to help us improve. Business engagement survey¹ Employee perceptions of the company's culture are mostly positive, as are their views on the company's approach to inclusion and well-being. 76 73 71 Employee engagement score² 75 75 Well-being favorability score³ Global benchmark5 2019 2020 2021 74 74 71 Inclusion score4 70 70 1 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies which are not integrated in Moody's IT systems and therefore the survey was not distributed to them). In addition, RMS is in the process of integration and will be reported in these metrics next year. Employees participating in employee engagement surveys in 2021 - 84%, 2020 - 86%, 2019 - 87%. 2 Employee engagement score is an average of two items: "How happy are you at Moody's?" and "Would you recommend Moody's?" 3 The favorability score is the average percentage of employees who agree Moody's takes a genuine interest in their well-being. Global benchmark for the well-being favorability score is not available. 4 Inclusion score is an average of item: "leaders in my line of business value different perspectives." 5 Survey third-party service provider's global benchmark is based on cross-client, cross-industry and cross-country company data from well over 700 organizations and over 150 countries.#66A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 66 Employee turnover, new hires and open positions Like most other companies, we experienced an increase in voluntary turnover, likely due to the effects of the COVID-19 pandemic on the labor market. Additionally, we saw an increase in unfilled skilled positions due to intensified hiring to support growth in key areas. As the competition for talent intensifies, we continue to invest in employee engagement and well-being as key elements of our talent retention strategy. Employee turnover rate 7% 4% 2020 13% Voluntary turnover Involuntary turnover 2021 New employee hires 2,728 1,432 2,707 2019 2020 2021 Talent Attraction¹ 2020 2021 Number of unfilled skilled positions (rounded)² 40 320 3% Open positions filled by internal candidates in calendar year 20% 28% Average hiring cost/FTE (USD, rounded) $7,000 $5,500 1 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies not integrated in Moody's IT systems). In addition, RMS is in the process of integration and will be reported in these metrics next year. 2 Positions that had been open for 90 days or longer as of December 31 of each respective year. -Log#67A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report Independent third-party office health and safety inspections' As part of our return-to-office strategy, we worked with leading global firms who specialize in environmental health and safety inspection, verification and testing to certify that each workplace was prepared for re-occupancy. These firms provided an independent audit to inform best-in- class recommendations in facility services areas such as cleaning, water and air testing and response planning. This audit also provided us an opportunity, where reasonable, to benchmark inspection results against peer companies. Ensuring the health and safety of employees We are committed to protecting the safety, health and well-being of all employees and individuals in our workplace. As a result, we are committed to complying with all health and safety laws and regulations, including laws and regulations relating to COVID-19 and / or other public health emergencies, in all countries and localities in which we do business. Occupational health and safety measures and programs, such as communications, trainings and policies, are managed at either the local or regional level. In addition, third-party providers in the global real estate group also track information relating to health and safety items, such as workplace injuries, and report such information where required (such as to the Occupational Safety and Health Administration in the U.S.). Site-based inspections of workspaces are also performed at offices, in accordance with local requirements. All applicable inspections, which may include such items as safety and fire inspections, are reported and filed with the authority having jurisdiction for those offices with the endorsement of any relevant work councils. Employees are also encouraged to report work-related hazards in the workplace. For more information on our reporting mechanisms, please see Ethics and Integrity. WORKPLACE OF THE FUTURE As we continue to monitor the risk presented by the pandemic, we are also re-assessing and evolving the ways we work. Initiated in 2020, our Workplace of the Future (WoF) program is focused on enabling a robust hybrid work model. As vaccination rates increased and local rules and regulations eased during 2021, we took a phased approach to reopening our offices for employees who wanted to return in person at least part of the time. By year end, approximately 90% of our office footprint was open for business. Employees had broad flexibility around when to work from the office and when to work from home, taking into account their individual well-being availability of child and elder care, and local infrastructure enabling them to travel safely to work. In addition to carefully following local rules and regulations, many locations implemented rotations to allow for physical distancing and provided mandatory training on protocols and employee expectations. MOODY'S 1 Refers to Moody's Corporation and its wholly-owned subsidiaries. 440 67#68A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 68 COMPENSATION AND BENEFITS' We believe our investments in compensation and benefits are an investment in our people. We strive for our compensation to be structured fairly, aligned to local markets, driven and differentiated by performance and understood and valued by all. Equal compensation An important part of our compensation philosophy is aligning compensation to local markets. We participate in salary surveys in each of our markets (a market can be considered a country, or a region or industry within a country). Each year, we anonymously submit compensation data for each job, based on job descriptions. An independent consulting firm aggregates and scrutinizes this information to ensure compliance with all data privacy regulations. We receive the aggregated data and analyze our pay rates in comparison with those of the local market. We review our pay structures every year before the annual salary review process, building a range for each salary band in each market. For information on pay equity, see Advocating for equal pay. Benefits We are committed to providing our employees a competitive benefits program designed to care for them and their families - including support for physical, mental and financial well-being. We promote preventive care and awareness and support a healthy lifestyle. Promoting financial wellness and supporting flexible work arrangements are critical to creating a work atmosphere in which people feel valued and inspired to give their best. Our benefits are benchmarked routinely against the market, using industry-specific data. Beyond delivering health, welfare, and retirement benefits and paid vacation and sick days, our benefits are extensive and inclusive, including a flexible work model and work-from-home arrangements. Benefits governance We have three benefits-related committees at the management level: » The Management Benefits and Compensation Committee regularly reviews global benefit plans and proposals; The Appeals Committee has final authority and responsibility for reconsidering benefit determinations when plan participants make a claim; and The Asset Management Committee is responsible for controlling, managing and investing the assets of the U.S. retirement plans. For more information on our policies regarding employee health and well-being, see Additional Resources. OUR EMPLOYEE BENEFITS Benefits offered to employees differ by work location; however, a benefits package can include: >>> Medical >>> Adoption assistance Dental >>> Surrogacy assistance >>> Vision >>> Back-up child and elder care >>> Flexible spending account >>> Commuter benefit plan >>> Health savings account » Club memberships >>> Employee assistance program >>> Parking and transportation allowances Retirement savings / pension termination indemnities >>> Car allowances >>> Meal benefits >>> Life insurance >>> Child care support Short-term and long-term disability insurance >>> Business travel accident coverage Employee referral program >>> Flexible work arrangements Financial planning Paid time off (vacation, personal days, sick leave, marriage leave, child care leave, compassionate leave, study leave, military leave, jury duty leave and holidays) Maternity leave >>> Parental leave Educational assistance >>> Discounted employee stock purchase plan Matching gifts program for charitable contributions >>> Auto and property insurance coverage discounts >>> Long-service awards >>> Free or discounted cultural memberships 1 Refers to employees on Moody's payroll.#69A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Our assistance programs Assistance programs are an important way we support our employees—whether through confidential legal, mental health or housing support or continuing education and transition assistance. Employee Assistance Program All employees and their dependents have access to our Employee Assistance Program (EAP), which is a confidential service to help employees and their immediate family members address personal concerns that affect their well-being. Although providers vary across the regions, all EAPS provide support with practical issues such as legal, housing and other queries, along with mental health support. Notable examples of times when our EAP has supported employees include the COVID-19 pandemic, the racial justice movement in the U.S. and the unfolding geopolitical conflict in Ukraine. Employees can contact the EAP confidentially and free of charge. Education Assistance Program We provide a global Education Assistance Program that enables employees to obtain tuition reimbursement to enhance skills that can improve job performance and further career development. Reimbursement amounts vary by location. Transition Assistance Programs Our transition assistance programs support employees who are retiring or whose employment has been terminated. These programs can include pre-retirement planning for intended retirees, severance pay and job placement services. We also offer outplacement services in certain circumstances. Our benefit updates In January 2021, we added our first ESG fund investment option to U.S. employees' Profit Participation Plan (401(k) plan). This provides employees the opportunity to invest retirement savings in a fund that takes a long-term approach aligned with and informed by the UN SDGs. Paid time off during COVID-19 We understand the importance of taking time away from our work lives to rest and rejuvenate. Unfortunately, with the ongoing pandemic, many employees did not take their fully allotted vacation time. In response, our leadership regularly encouraged employees to use PTO to relax and recharge. Some business unit leaders identified suitable periods for all their employees to take leave concurrently, enabling employees to relax without the pressure of returning to emails and work done by others in their absence. While these periods were not mandatory, employees were strongly encouraged to make full use of their vacation to rest and avoid burnout and fatigue. Enhancing support for vets and student loan borrowers » Military leave: To better support our U.S. military service members, all our eligible full-time and part- time employees can now receive up to six months of their regular salary and benefits while on military leave. This is a five-month increase from our previous policy. Concern about financial well-being is not a problem our military service members should have; this updated policy will do more to keep Moody's an attractive place to work and shows that our DE&I commitment extends to each segment of our workforce. Student loan payoff program: Student loan debt remains one of the largest sources of consumer debt in the United States, disproportionately affecting Black and LatinX borrowers and holding borrowers back from financial peace of mind for years. Through our Student Loan Payoff Program, we now offer contributions toward the principal balance of the student loans for our eligible employees. Looking forward, this program will help to contribute to lower barriers for young professionals. Moody's 2021 Stakeholder Sustainability Report 69#70A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 70 Communities WILL NOT BE END ACIS Our approach to community engagement and corporate social responsibility (CSR) is rooted in our purpose: to bring clarity, fairness and knowledge to an interconnected world. We bring together various elements of our business - employees, products and services and social capital - to empower people with the knowledge, resources and confidence they need to create better lives. Investment in our communities $6,904,600 $6,430,400 $5,584,300 $555,300 $581,400 $667,000 $532,500 $789,900 $874,300 $1,935,500 $1,859,600 $1,078,000 Through our CSR programs, employee engagement activities and Moody's Foundation' grants, and in alignment with the UN SDGs, we are helping to build toward a world where more people have access to opportunity and where everyone has the resources to grow and thrive. $3,832,400 $3,100,000 $3,113,900 SUPPORTING CAUSES WE CARE ABOUT Giving is a critical component to advancing our ambition. Following a hallmark year for giving in 2020, our corporate, foundation and employee-driven philanthropy efforts culminated in a total of more than $6 million donated in 2021. 2019 Moody's Foundation grants² Value of volunteer hours4 2020 Moody's charitable contributions³ Employee-driven giving5 2021 1 Moody's Foundation is a separate legal entity and is governed by its own Board of Directors composed of members of management. This board approves social investments and all grants that the Foundation makes. 2 Grants paid from the Foundation toward projects aligned with its strategic focus areas. 3 Payments made by MIS, MA and MSS that have been classified as charitable contributions. Includes charitable contributions to volunteering vendors (nonprofits and social enterprises that coordinate volunteer experiences), previously reported separately. 4 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies not integrated in Moody's IT systems). In addition, RMS is in the process of integration and will be reported in this metric next year. 5 Grants paid from Moody's Foundation toward the Matching Gifts and Dollars for Doers programs.#71A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 71 BUILDING MORE RESILIENT COMMUNITIES Across our three focus areas, DE&I serves as a lens through which to guide and evaluate our CSR efforts. Empowering people with financial knowledge Our signature financial inclusion initiative, Reshape Tomorrow™, helps entrepreneurs - particularly women and other under-resourced groups - by empowering them with the financial tools and knowledge to navigate the lending process, grow their businesses and stimulate entrepreneurship. In 2021, we worked with eight Reshape Tomorrow™ partners around the world. 2021 focus area summary¹ Key impact metrics: ($) $1.6 million invested 29 countries served Beneficiaries: 96% efficacy rate 4,900 total reach 65% female WEConnect International In partnership with WEConnect International, our "Financing Your Growing Business" program supports women business owners through interactive boot camps and online training modules that focus on credit training and accessing markets and capital. WEConnect International connects more than 13,000 women-owned businesses based in over 125 countries to qualified buyers. In 2021, we expanded this program into new markets, offering the trainings in 11 countries, including Costa Rica, Japan, Mexico, U.K. and South Africa. We look forward to continuing this expansion in 2022. 1 Measured using Mission Measurement's Impact Genome Project methodology. Data is reflective of programming that was active in the calendar year and is not reflective of all Moody's grant partners. After participating in a boot camp in Singapore, attendee Dr. Alison Eyring shared how her experience helped lead to the creation of Produgie, a technology company and spin-off of Singapore- based Organisation Solutions focused on democratizing business growth enablement. "Moody's Boot Camp challenged my beliefs about the benefits of borrowing and of raising capital. My experience bolstered my confidence when I spun off a technology company from my existing business and raised a seed round. We are on a path to raise Series A this year. 11 - Dr. Alison Eyring, CEO & Founder, Produgie#72A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 72 Helping young people reach their potential We are helping young people from under-resourced communities pursue careers in finance, technology and economics - and build brighter futures as the leaders of tomorrow. Moody's HerCapital Program Moody's HerCapital Program launched in 2021 in partnership with Sponsors of Educational Opportunity (SEO). The six-month program aims to build the confidence of women leaders entering finance, tech and economics by focusing on various soft, technical and professional skills. The current cohort of more than 160 female students — most of whom are from historically underrepresented groups-attend 51 universities in Belgium, the U.K. and Germany. In addition to authentic exposure to the financial services industry, the program offers opportunities for internships with Moody's. 2021 focus area summary¹ Key impact metrics: $1.1 million invested 7 countries served 100% efficacy rate Beneficiaries: 10,000 total reach 75% female Supporting social equality and the environment When distributing our grants, we support social equality and the environment in our communities, prioritizing local organizations that build inclusive and resilient communities, particularly in emerging economies. Fundación MarViva By partnering with Fundación MarViva, we worked to elevate sustainable fishing practices and provide e-commerce tools for environmentally responsible artisanal fishermen in Latin America to grow their businesses. The promotion of marine sustainability and the support of coastal families, many of whom are living in extreme poverty, help to build more inclusive and resilient communities at the local level. Additionally, Moody's employees engaged in skill-based volunteering events aimed at helping MarViva tackle some of its organizational strengthening needs through, for example, virtual training sessions. 2021 focus area summary¹ Key impact metrics: $ $308,000 invested 37 countries served 100% efficacy rate Beneficiaries: 62,000 total reach 57% female 1 Measured using Mission Measurement's Impact Genome Project methodology. Data is reflective of programming that was active in the calendar year and is not reflective of all Moody's grant partners. More information about our grant-giving guidelines and each of our beneficiary organizations can be found on the Moody's Foundation webpage.#73A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 73 VOLUNTEERING OUR EXPERTISE We encourage employees to apply their knowledge and expertise to help strengthen their communities through company-wide volunteer initiatives, such as: » » Moody's TeamUp®, which unites people in local offices and across business groups to complete service projects in their local communities; Moody's Future Solutions™, our pro bono volunteer program, uses the professional skills of our employees to help nonprofits build capacity and solve pressing challenges; Moody's Impact Leaders program, a global network of employees playing leadership roles in shaping our strategy and initiatives in their local offices; and Moody's Up2You, which encourages collaboration among Moody's colleagues to host events and activities that support eligible nonprofits. Our employees contributed 11,238 volunteer hours to their communities in 2021. Following a successful global immersive Moody's Future Solutions™ program, Moody's and SynTao Green Finance (a Moody's minority affiliate based in China providing ESG data and analytics services) supported the Institute for Sustainable Development Goals of Tsinghua University to establish the assessment framework for ESG / sustainability development of regional and local governments in China. Additionally, a number of our employees and leaders sit on the advisory and governing boards of the organizations we support and provide strategic guidance. Some of these organizations include Asian Venture Philanthropy Network, Asociación Conciencia, Girls Inc., Hetrick-Martin Institute, Prep for Prep, Village Capital, Youth About Business and WEConnect International. For more information on our policies regarding communities, see Additional Resources. 1.8 BI PRODUCE OF LA OPI#74A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 74 C= BETTER SOLUTIONS ESG Solutions A ESG Integration#75A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 75 Better Solutions As a global integrated risk assessment firm, we play a pivotal role in driving the transformation of financial markets to advance strategic resilience, responsible capitalism and the greening of the economy. Our ESG offering delivers the highest standard of data quality, transparency and adaptability. Complemented by a longstanding record in financial risk modeling, we provide trusted ESG data, insights and analytic capabilities to present an all-encompassing view of ESG risks and opportunities. We help debt issuers and other companies, investors and financial institutions address an unrivaled range of ESG challenges and opportunities, championing meaningful change and preventing greenwashing. These capabilities include sustainable debt issuance, climate risk management, public and private company analysis, financial and sustainability impact and regulatory considerations. Throughout 2021, we continued to expand our ESG offering and integrate ESG into existing capabilities. We also continued to make strategic investments so that our offering provides the depth and breadth necessary to respond to the diverse and evolving requirements of ESG market participants. OUR COMPREHENSIVE OFFERING We meet the needs of our customers and the financial markets through our holistic view of risk and impact. Our offering consists of ESG domain expertise, risk quantification capabilities and credit impact measures - all channeled through intuitive platforms to provide our customers with integrated risk assessments. Our Product Vitality Index Our Product Vitality Index demonstrates how the growth of ESG solutions and integration drive innovation at our company. New products and products from acquisitions' in the last five years contributed to approximately 15% of the total Moody's revenue in 2021 and our legacy products contributed 85%. For more information about Moody's ESG products and solutions, visit our dedicated ESG website. Customers 1 New products include revenue from product expansion to new markets. The metric does not consider revenue from joint ventures. ESG Domain Climate Solutions » » ESG Measures » Sustainable Finance » 0.0 Risk Quantification Catastrophe Models Integrated Risk Assessment » Lending Solutions & Tools » Credit Impact >>> Credit Ratings & Research ESG Credit Impact Scores » Risk Analytics & Reporting >>> ESG Classification » Real Estate Solutions >>> Heat Maps Asset Managers 0000 Banks & Insurers & Asset Owners Companies & Organizations Governments & Academia Professional Services#76A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 76 ESG Solutions We help to empower market participants to make better, more sustainable decisions. Our solutions provide the tools to enable our customers - including companies, banks, insurers, governments, asset managers and asset owners — to identify and manage ESG risks and opportunities, strengthen sustainability action plans and communicate with their key stakeholders. Our mission is to provide clear, traceable and defensible intelligence that instills confidence throughout our customers' decision-making processes. Over the past three years, ESG has been a strategic growth driver for Moody's. ESG-related revenue in 2021 increased 36% year-over-year to $29 million, with $22 million in stand-alone ESG revenue and $7 million from integrating our ESG-related solutions into MIS and MA products. The acquisition of RMS, a leading global provider of climate and natural disaster risk modeling and analytics, further demonstrates the strategic importance of ESG to Moody's business. This acquisition builds on our strategy to invest in companies focused on providing ESG data, research or services for market participants, which began in 2019 with our investments in V.E and Four Twenty Seven, Inc. GROWTH OF ESG AT MOODY'S IN 2021 +36% Year-over-year increase in ESG-related revenue (excl. RMS)¹ $81 million RMS post-acquisition revenue, from September 15-December 31, 20212 Andrea Blackman MD-Clobal Head of ESG Moody's ESG Solutions Hear more from Andrea Blackman, Head of ESG Solutions 1 Represents approximate revenue in (i) stand-alone ESG products and services, including our Climate Solutions, sustainable finance, research and insights products; and (ii) MA and MIS ESG-focused product enhancements. 2 Net of an $18 million deferred revenue adjustment.#77A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX ESG DOMAIN OFFERING We aim to provide comprehensive coverage in the form of granular and clearly defined ESG metrics spanning every major asset class and industry. The following table outlines our capabilities and related impact. CAPABILITY WHAT WE PROVIDE¹ » Фо Analyst-validated ESG data, scores and assessments for global public and private companies; OUR IMPACT Moody's 2021 Stakeholder Sustainability Report 77 Enables organizations to: >>> Seize opportunities for sustainable value creation; >>> Identify and manage material ESG factors affecting portfolio and supply-chain performance for more than 140 million companies through analyst-validated and model-driven ESG assessments; and Identify best-in-class performers to build innovative, labelled products. >>> Notable Second Party Opinions (SPOs) in 2021 included: >>> Republic of Benin's SDG Bond >>> » Framework, first-ever SDG bond issuance in Africa and one of the first in the world; IDB Invest's Sustainable Debt Framework, first ICMA-aligned Sustainability Debt Framework from a high-grade multilateral development bank; European Commission's NextGenerationEU Green Bond Framework, with the NextGenerationEU green bond program of up to €250 billion, the EU will become the largest green bond issuer worldwide; and » Ford's Sustainable Financing Framework, North America auto industry's first sustainable financing framework. ESG >>> Modelled ESG data and scores for global public and private companies; Controversy monitoring and portfolio management tools for >>> MEASURES over 10,000 entities; and ESG data powering more than 100 ESG indices. CLIMATE SOLUTIONS » Climate Risk Identification: >>> >>> Forward-looking data capturing exposure to climate hazards for thousands of listed companies with global corporate facilities, millions of U.S. commercial real estate properties, as well as global sovereigns and sub-sovereigns; and Assessments of thousands of companies to identify transition risk exposure from different fossil fuel resource types and power-generation technologies. Climate Risk Quantification: » >>> Climate-adjusted Macroeconomic Scenarios; Climate-adjusted Probability of Default (PD); and >>> Climate Pathway Scenarios. » » >>> SPOs of green, social and sustainability bonds and loans for corporates and sovereign customers, with more than 450 SPOs to-date in over 30 countries Sustainability Ratings and benchmarks; and >>> Green Verifications (including the CBI verification scheme, Nasdaq Green Equity and Nasdaq Green Equity Transition designations). >>> SUSTAINABLE FINANCE » Empowers market participants to identify, quantify and manage their climate-related risks and opportunities. Brings clarity to a company or transaction's sustainability impact and/or alignment to strategic frameworks and market standards; Helps organizations to maximize their sustainability performance and stakeholder value; and Supports organizations' access to capital and their communication of sustainability performance to key stakeholders. 1 Data as of December 31, 2021.#78A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 78 EXPANDING OUR ESG CAPABILITIES Throughout 2021, we achieved significant milestones in the expansion of our ESG capabilities, including: » >>> The launch of Climate Solutions, our comprehensive product suite dedicated to the identification, quantification and monitoring of climate risks. In 2021, we expanded our data coverage of the physical risks posed by climate change with new sub-sovereign climate risk scores that quantify population-weighted exposure to floods, heat stress, hurricanes and typhoons, sea level rise, water stress and wildfires. The scores complement our expanding coverage of forward- looking physical risk data for locations globally, including scores for 200 sovereigns. In December, we announced the launch of Temperature Alignment Data, a net-zero solution that assesses how companies' emissions targets align with global temperature benchmarks and tracks their progress toward meeting those targets. As part of our ESG Measures offering, focused on ESG data, scores and assessments, we announced: The introduction of ESG Score Predictor, a first- of-its-kind tool to generate real-time predicted ESG scores for millions of public and private SMEs worldwide. Based on a model derived from our proprietary ESG scoring methodology for - large-cap corporates, the ESG Score Predictor provides financial institutions with essential quantitative data for portfolio and risk management, and helps companies monitor ESG risk across their global supply chains. The expansion of regulatory data solutions, such as Sustainable Finance Disclosure Regulation Principal Adverse Impact (SFDR PAI) Data covering thousands of entities, a bespoke ESG data solution aimed at helping market participants meet European Union SFDR requirements. In October, we launched EU Taxonomy Alignment Screening, a new data solution that helps market participants, including asset managers, banks and insurance companies, respond to disclosure requirements under the evolving EU Taxonomy regulation. The establishment of two normative standard screening solutions, Sustainable Development Goals (SDG) Alignment Screening and Global Compact Screening, that help enable investors and other market participants to integrate the SDGS into their strategies and evaluate the alignment of approximately 5,000 listed companies with the sustainability-focused principles of the United Nations Global Compact respectively. In 2022, we launched Moody's ESG360-an easy-to-use platform delivering transparent ESG and climate data and insights through an intuitive interface. Throughout the year, we will also enhance Moody's ESG assessments methodology based on our double materiality approach.#79A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 79 EDUCATING MARKETS THROUGH OUTREACH AND RESEARCH We engage with the global stakeholder community and produce relevant thought leadership to help translate our cutting-edge analytics into actionable insights. For example, during COP26 in Glasgow in November 2021, we engaged in a wide range of discussions to share our insights and expertise on the challenges faced by companies and investors as they seek to adopt and accelerate net-zero targets. ENGAGING THROUGH PARTNERSHIPS Industry partnerships are a critical pillar to our engagement activities. Through our affiliation with leading market organizations, we foster opportunities to gain first-hand and valuable insight from market participants which, in turn, inspire our continual development of ESG and climate risk products and solutions. Below are a representative selection of our partners. CSR யது FINANCE Throughout 2021, we coordinated a number of events and published thought leadership on high-interest topics, including: 49 thought leadership papers published on the ESG Insights and Analysis hub 13 hosted events and 38 sponsored events on topics such as biodiversity, water stress and net-zero (with an 88% average satisfaction score in hosted events, above the global average) FUTURE OF FOSDA SUSTAINABLE DATA ALLIANCE ICMA 23 Capital Markel Action total consultations submitted to standard setters, regulators and ESG influencers in Europe, North America and APAC#80A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 80 ESG Integration Beyond our comprehensive suite of ESG solutions, we continue to integrate ESG considerations across our portfolio — from credit ratings to risk management insights and analytics. We aim to provide easily accessible, high-quality ESG data to our analysts and customers. To achieve this, we are expanding our ESG capabilities through targeted investments and acquisitions and developing a robust data infrastructure that streamlines access to ESG, climate risk and sustainable finance data. ESG INTEGRATION INTO CREDIT RATINGS Moody's Investors Service (MIS) systematically incorporates material ESG and climate considerations into its credit analysis and credit ratings to help market participants understand how ESG issues affect their fixed income decisions. In January 2021, MIS launched ESG Issuer Profile and Credit Impact Scores to provide greater transparency into how ESG considerations are incorporated into credit ratings. While initially focused on sovereign issuers, MIS expanded its coverage in 2021 to include more than 1,700 governments, financial institutions and corporations across a wide range of sectors. By the end of 2022, MIS intends to publish ESG scores for thousands of additional rated issuers. Assessing exposure with Issuer Profile Scores Issuer Profile Scores (IPSS) are assessments of the exposure to environmental, social and governance risks or benefits, based on the general ESG principles that have a material impact on credit quality. Based on a five-point scale ranging from positive (E-1, S-1 or G-1) to very highly negative (E-5, S-5 or G-5), these scores provide a consistent way to express this assessment. IPS Scoring Scale E-1 S-1 G-1 Positive E-2 S-2 G-2 Neutral-to-low E-3 S-3 G-3 Moderately negative E-4 S-4 G-4 Highly negative E-5 S-5 G-5 Very highly negative#81A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 81 Measuring impact with ESG Credit Impact Scores Credit Impact Scores (CISS) are an output of the credit rating process that indicate the extent, if any, to which ESG factors impact the credit rating of an issuer or transaction. Similar to IPS, these scores are attributed on a five-point scale from very highly negative (5) to positive (1). For example, the CIS score of the issuer in Figure 1 is highly negative (CIS-4), reflecting high exposure to social risks and moderately negative exposure to environment risks, combined with relatively low resilience as weakening public finances and relatively low-income levels constrain the issuer's capacity to respond to environmental and social shocks. Figure 1 On the other hand, the CIS score of the issuer in Figure 2 is positive (CIS-1), reflecting low exposure to environmental risks, limited social risks and very strong governance and forward-looking policymaking. Figure 2 CIS-1 Positive Sector median Issuer CIS score Negative impact Positive impact CIS-4 Highly Negative Negative impact Positive impact Sector median Issuer CIS score ADDITIONAL COMPONENTS OF MIS INTEGRATION In addition to ESG scores, MIS publishes Carbon Transition Assessment scores (CTAS), which provide a consistent and verifiable means to analyze carbon transition risk for 380¹ rated issuers in the most exposed sectors, such as oil and gas and automobile manufacturers, among others. For each of the sectors MIS rates globally, MIS also publishes Environmental and Social Risk Heat Maps that visualize the relative ranking of various sectors along the E and S classification of risks. As the CTAs demonstrate, MIS is committed to creating tools that help the financial system assess transition risk and readiness for a low-carbon world. 1 Cumulative data as of December 31, 2021.#82A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 82 ESG INTEGRATION FOR RISK QUANTIFICATION By integrating ESG considerations into our Moody's Analytics (MA) risk management scoring and data products, we are providing global markets with critical financial risk information. We have taken steps to further incorporate ESG considerations into a number of our risk assessment products and tools, including: » Moody's CreditView: We are integrating our ESG and Climate Scores and Assessments into Moody's CreditView―our flagship research, data and analytics platform that features MIS credit ratings and analysis along with MA research and data. >>> Climate Pathway Scenario Service: Built on our award-winning scenario generation software, this service helps insurers meet Own Risk and Solvency Assessment (ORSA) and Task Force on Climate- Related Financial Disclosures (TCFD) requirements by quantifying the financial impact from physical and transition risk. It can also support the integration of climate risk into strategic asset allocation (SAA) and investment screening processes. The Climate Pathway Scenario Service won the Climate Risk Initiative of the Year in the 2021 Insurance Asset Risk Awards in North America. » Commercial Lending Operating Unit: In October 2021, we made proprietary climate risk scores available on our leading commercial real estate (CRE) analytics platform. These climate risk scores quantify the exposure of commercial properties and geographies to the physical impacts of climate change, providing investors, brokers and lenders a more holistic view of risk exposure. >>> Orbis: The world's most powerful comparable data resource on private companies, Orbis has information on over 400 million global entities. We are incorporating additional ESG data sources into our existing database and standardizing it to make it richer, more powerful and easier to integrate into our customers' workflows. For the third straight year, Orbis won the Best Data Solution for Know Your Customer (KYC) category in the RegTech Insight Awards 2021 in Europe. In 2022, we will launch our ESG Premium offering, which will include interactive peer comparison and screening tools to provide deeper insights into a company's ESG performance. Hear more from Juan Licari, MD-Analytics & Modeling#83A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 83 Strategic acquisitions and investments We continue to make strategic acquisitions and investments that build on our ESG risk monitoring and assessment capabilities. In 2021, our acquisitions focused on cyber and supply chain risk, enhancing our integrated risk capabilities and recognizing ESG considerations are increasingly relevant to issuers, investors and other market participants. Cortera We completed our acquisition of Cortera in March 2021. Cortera, a leading provider of North American credit and data workflow solutions, enhances our risk assessment capabilities and extends our coverage in the SME segment. Cortera augments our extensive database of private company information and enhances our KYC, commercial lending and supply chain solutions. BitSight In September 2021, we invested $250 million in BitSight, a cybersecurity risk ratings and assessments company, to enhance BitSight's capabilities and create a comprehensive, integrated, industry-leading cybersecurity risk platform to help market participants understand cyber risks. RealXData In September 2021, we acquired RealXData, a provider of CRE lease-level portfolio management with benchmarking and forecasting capabilities. The acquisition advances our ability to help customers manage their real estate portfolios, analyze performance and define strategy on one platform. RMS We acquired RMS in September 2021. With over 400 risk models covering 120 countries, RMS provides extensive and quantitative climate and catastrophe risk modeling solutions for P&C insurers and reinsurers, enabling them to better understand, measure and manage risk. Bogard In November 2021, we acquired Bogard, a leading provider of data and information on politically exposed persons in the Nordic region. The acquisition advances our ability to help customers perform KYC screening and research to address financial crime. PassFort In December 2021, we acquired PassFort, a SaaS-based workflow platform for identity verification, customer onboarding and risk analysis. The integration of PassFort's platform into our suite of KYC and compliance solutions will create a more holistic workflow solution, allowing customers to incorporate our data, including credit, cyber, ESG and climate analytics, directly into their proprietary processes. 360kompany AG In February 2022, we completed the acquisition of 360kompany AG (kompany), a platform for audit-proof business verification and KYC, operating a network of primary source information on more than 115 million companies across 200 jurisdictions. The platform's API enables our customers to complete shareholder analysis and entity verification in real time, as well as retrieve original company filings and documents to meet their regulatory demands. "Today's leaders face a complex, interlinked world of risks and stakeholders. In the context of a global pandemic, the climate crisis and increasing cyberattacks, our customers must manage a wider range of risks than ever before. We are excited to add RMS and its team of world-class data scientists, modelers and software engineers to the Moody's family to help accelerate solutions that enable customers to build resilience and make better decisions." - Robert Fauber, President & CEO#84A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 84 APPENDIX Metric Summary Framework Index Glossary Additional Resources#85A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 85 Metric Summary The following metric summary contains the data and metrics referenced in our 2021 Stakeholder Sustainability Report. In addition, our report is accompanied by a Methodology Note for the first time, which aims to increase transparency on methodologies used in our sustainability accounting to accurately measure and report our ESG progress and impacts. Unless otherwise noted, this document covers all of Moody's Corporation (NYSE: MCO) and its subsidiaries, and all quantitative data covers the period from January 1 to December 31, 2021. BETTER BUSINESS CLIMATE¹ Total absolute GHG emissions 2019 2020 2021 mtCO2e % actual data* mtCO2e % actual data* mtCO2e % actual data* Scope 1 GRI 305-1 WEF Planet: greenhouse gas (GHG) emissions Scope 2 market-based 1,744 46% 919 75% 851 76% GRI 305-2 WEF Planet: greenhouse gas (GHG) emissions Scope 2 location-based 13,591 77% 2,745 82% 432 86% GRI 305-2 WEF Planet: greenhouse gas (GHG) emissions Scope 3 14,035 77% 8,767 82% 6,878 86% 172,360 27% 112,368 26% 121,280 10% GRI 305-3 WEF Planet: greenhouse gas (GHG) emissions Purchased goods and services 123,000 17% 88,700 25% 105,500 10% Capital goods Fuel and energy-related activities Business travel² Employee commuting² Waste generated in operations Investments Total Scope 1, Scope 2 market-based, Scope 3 GHG intensity (Scope 1 and Scope 2 mtCO2e/sq ft)³ 4,700 17% 9,500 25% 5,300 10% 4,600 74% 800 87% 220 89% 23,100 85% 3,300 91% 1,480 93% 10,400 18% 3,100 26% 208 31% 460 29% 68 31% 72 31% 6,100 0% 6,900 0% 8,500 0% 187,695 31% 116,032 27% 122,563 11% 0.006 Not available 0.001 Not available 0.001 Not available GRI 305-4 GHG intensity (Scope 1 and Scope 2 mtCO2e/$ million of revenue) 3 GRI 305-4 Not available 1 Not available 0.2 1 Our 2019 and 2020 GHG emissions were retroactively recalculated due to improved access to vendor spend data and M&A activity. Consequently, our science-based targets for reducing our GHG emissions were re-submitted to the Science Based Targets initiative (SBTI) and coverage was re-validated. 2 Business travel and employee commuting emissions were restated to include well-to-wheel emissions to ensure alignment to the SBTI Target Validation Protocol and Transport Guidance. 3 Emissions include all offices under financial control. Square footage includes Moody's managed offices and excludes shared-space offices due to data limitations. The impact is expected to be not material, with emissions in shared-space offices accounting for approximately 0.6% of total GHG inventory in 2021. Not available * Figures have been updated since original publication#86A MESSAGE FROM OUR 2021 SUSTAINABILITY PRESIDENT & CEO HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX CLIMATE (continued) Energy consumption GRI 302-1 Total energy (MWh) Energy intensity ratio per sq ft (kWh/sq ft) GRI 302-3 Scope 1 - direct Natural gas (MWh) Other direct (diesel, liquefied petroleum gas) (MWh) Scope 2-indirect Total electricity consumption from operations (MWh) Renewable electricity use² Out of which covered by Energy Attribute Certificates purchased by Moody's directly Other indirect (purchased steam and cooling) (MWh) Decarbonization plan indicators Reduction of Scope 1 and Scope 2 from 2019 base year Target: 50% (by 2030) GRI 305-5 WEF Planet: Paris-aligned GHG emissions targets Reduction of Scope 3 fuel and energy-related activities, business travel and employee commuting from 2019 base Target: 15% (by 2025) year GRI 305-5 WEF Planet: Paris-aligned GHG emissions targets Supplier spend covered by science-based targets Target: 60% (by 2025) WEF Planet: Paris-aligned GHG emissions targets Renewable electricity use (property portfolio)² Target: 100% GRI 302-1 Offsetting our carbon emissions from operations, employee commuting and business travel since year 2000 Target: 100% 2019 2020 48,251 32,166 19.8 13.0 Moody's 2021 Stakeholder Sustainability Report 86 2021 27,969 11.9 5,211 2,886 4,299 918 466 75 36,477 24,377 20,619 11% 100% 100% 0% 84% 87% 5,645 4,437 2,976 76% 92% 81% 95% 25% 24% 28% 11% 100% 100% 100% 1 Our 2019 and 2020 GHG emissions were retroactively recalculated due to improved access to vendor spend data and M&A activity. Consequently, our science-based targets for reducing our GHG emissions were re-submitted to the Science Based Targets initiative (SBTI) and coverage was re-validated. 2 Renewable electricity percentage is reported based on originally verified electricity consumption values because it is not possible to buy renewable electricity retroactively due to M&A activity; therefore, the 2020 restated verification opinion shows a decrease in percentage renewable electricity. 100% 100%#87A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX ENVIRONMENT AND NATURAL RESOURCES Waste (metric tons)¹ Total waste from office operations GRI 306-3 Landfill GRI 306-5 Recycled goods GRI 306-4 Recycled paper GRI 306-4 Percentage of our employees in offices that implemented sustainable practices Phased out single use plastics Implemented centralized waste collection² Eliminated coffee machines with capsules/sachets Recycle coffee capsules/sachets Percentage spend on sustainable materials3.4 Eco-friendly office paper Eco-friendly stationery and office supplies Office paper use Reduction of office paper from 2019 baseline4 Target: 50% RESPONSIBLE SOURCING Supplier diversity Diverse supplier spend Women-owned Small businesses 1 Actual waste represented 31% of reported volume in 2021. The reported figure represents an extrapolation to cover the full property portfolio. 2 Includes offices that have more than 50 full-time employees, covering approximately 89% of operations based on employee number. 2019 2020 Moody's 2021 Stakeholder Sustainability Report 2021 3,922 601 429 667 132 149 1,697 198 241 1,558 272 39 75% 68% 35% 83% 68% 46% 36% 37% 79% 99% 2019 2020 2021 10% 8% 7% 0.3% 4% 3% 1% 1% 2% 3 Office paper, stationery and office supplies qualify as eco-friendly when they meet one of the more than 45 environmental attributes that are reported by suppliers, see the full definition in the Methodology Note. The decrease in eco-friendly office paper in 2021 is due, in part, to supply chain issues and the limited selection of eco-friendly paper for orders for remote work. 4 Represents our offices in the U.S. We are working to collect actual data globally. 5 Data includes addressable spend with suppliers that we do business with directly (Tier 1). 87#88A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 88 (888) BETTER LIVES 2019 2020 2021 Female Not Disclosed Male Female Not Disclosed Male Female Not Disclosed DIVERSITY, EQUITY & INCLUSION Male Global gender diversity1,2 GRI 405-1 SASB SV-PS-330a.1 WEF People: diversity and inclusion (%) Executive 70% 30% Senior Manager 67% 33% Mid-level Manager 67% 33% First-level Manager 63% 37% Non-manager 51% 48% TOTAL 58% ༄ ༅ །། | │ │ 41% 1% Race/Ethnicity: United States GRI 405-1 SASB SV-PS-330a.1 U.S. Officers and Managers4 U.S. Workforce White WEF People: diversity and inclusion (%) Global employee breakdown by region 53% 49% GRI 102-8, 405-1 WEF People: diversity and inclusion (%) Americas (excluding U.S.) Asia-Pacific EMEA U.S. 67% 33% 69% 31% 67% 33% 68% 32% 67% 33% 68% 32% 63% 37% 61% 39% 1% 50% 49% 1% 50% 49% 1% 59% 41% 59% 41% 2020 Underrepresented groups³ Other White 2021 Underrepresented groups³ Other 43% 4% 53% 43% 4% 45% 6% 49% 45% 6% 2020 2021 679 764 3,429 4,197 3,145 3,665 4,234 4,834 1 Executives represent CEO, CEO-Direct, Exec Directors, GMD, SMD and MD level; senior managers represent AMD, Country Head, SVP and Senior Director level; mid-level managers represent VP-SCO, VP-SA, VP and Director level; first-level managers represent AVP-Analyst, AVP, Associate Director and Assistant Director level; non-managers represent Analyst, Assoc Analyst, Assoc and Associate level. 2 The data by seniority represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies for which this data was not available). The total breakdown by gender represents the full employee population. 3 Underrepresented groups include employees who identified as Asian, LatinX, Black, Native American/Alaskan Native, Hawaiian/Other Pacific Island or two or more races. 4 Officers and Managers are calculated using the job categories: executives, senior managers, mid-level managers and first-level managers.#89A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 89 DIVERSITY, EQUITY & INCLUSION (continued) Pay equity¹ Global gender pay equity GRI 405-2 Women's WEF People: pay equality WEF People: pay gap pay compared to men U.S. Ethnicity pay equity WEF People: pay equality WEF People: pay gap Non-white² employees' pay compared to white employees Black employees' pay compared to white employees LatinX employees' pay compared to white employees Asian employees' pay compared to white employees Board demographics: gender (as of respective annual stockholder meeting) GRI 102-22, 405-1 WEF Principles of governance: governance body composition Male Female Not disclosed Board demographics: race/ethnicity (as of respective annual stockholder meeting) GRI 102-22, 405-1 WEF Principles of governance: governance body composition White Underrepresented groups³ Not disclosed 2022 $0.99 $1.01 $1.00 $0.99 $1.02 2020 2021 2022 7 6 7 3 3 3 0 0 0 8 7 7 1 2 2 1 0 1 1 As of April 1, 2022. The population studied includes employees eligible for Moody's compensation programs and excludes limited duration employees, non-employees, temporary workers and employees from companies acquired in 2H 2021. Employees from V.E and Four Twenty Seven were excluded from the analysis due to not being integrated into Moody's compensation programs at the time of the analysis. This exclusion is non-material and represents 3% of employees. 2 Defined as Latinx, Black and Asian. 3 Underrepresented groups include employees who identified as Asian, LatinX, Black, Native American/Alaskan Native, Hawaiian / Other Pacific Island or two or more races.#90A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX HUMAN CAPITAL New employee hires New employee hires GRI 401-1 SASB SV-PS-330a.2 WEF Prosperity: absolute number and rate of employment Employee turnover rate GRI 401-1 SASB SV-PS-330a.2 WEF Prosperity: absolute number and rate of employment Voluntary turnover Involuntary turnover Full-time/Part-time employees GRI 102-8 Full-time Part-time SASB SV-PS-000.A Employees by business segment Moody's Analytics (MA) Moody's Investors Service (MIS) Moody's Shared Services (MSS) 2019 2020 Moody's 2021 Stakeholder Sustainability Report 90 2021 2,728 1,432 2,707 7% 13% 4% 3% 11,234 253 13,202 258 5,008 6,529 5,051 5,295 1,428 1,636#91A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX HUMAN CAPITAL (continued) Collective bargaining agreements Employees covered by collective bargaining agreements¹ GRI 102-41 WEF People: freedom of association and collective bargaining at risk (%) Employee engagement²,3 Employee engagement score+ SASB SV-PS-330a.3 Global benchmark5 Well-being favorability score Global benchmark5 Inclusion score Global benchmark5 Performance review Employees who received performance and career development reviews via Grow, Perform, Succeed (GPS) GRI 404-3 2019 2020 Moody's 2021 Stakeholder Sustainability Report 91 2021 10% 10% 9% 71 76 73 72 74 75 80% 76% Not available 71 74 74 68 69 70 1 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies not integrated in Moody's IT systems). In addition, RMS is in the process of integration and will be reported in this metric next year. 2 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies which are not integrated in Moody's IT systems and therefore the survey was not distributed to them). In addition, RMS is in the process of integration and will be reported in these metrics next year. 3 Employees participating in employee engagement surveys in 2021 - 84%, 2020 - 86%, 2019 - 87%. 4 Employee engagement score is an average of two items: "How happy are you at Moody's?" and "Would you recommend Moody's?" 5 The global benchmark provided by the survey third-party service provider is based on cross-client, cross-industry and cross-country company data from well over 700 organizations and over 150 countries. 6 The favorability score is the average percentage of employees that agree Moody's takes a genuine interest in their well-being. 7 Inclusion score is an average of item: "leaders in my line of business value different perspectives." 8 Employees in a probation period or who joined Moody's from newly acquired companies do not participate in the GPS performance review process. Certain non-wholly-owned subsidiaries for which this data was not available are excluded from the analysis, therefore the data represents 76% of the total employee population. 92%#92A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX TRAINING AND UPSKILLING¹ Training hours² Absolute number of training hours Average training hours per employee GRI 404-1 WEF People: training provided (#) Officer³ Non-officer Training expenditure Average training and development expenditure per employee WEF People: training provided ($) Training and development expenditure as a percentage of payroll WEF People: monetized impacts of training TALENT ATTRACTION¹ Number of unfilled skilled positions (rounded)4 WEF People: number of unfilled skilled positions (#) Open positions filled by internal candidates in calendar year Average hiring cost/FTE (USD, rounded) 2019 2020 Moody's 2021 Stakeholder Sustainability Report 2021 251,109 205,419 218,816 24 21 18 28 21 17 21 21 20 1 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies not integrated in Moody's IT systems). In addition, RMS is in the process of integration and will be reported in these metrics next year. 2 Data includes hours captured in the Moody's Knowledge Portal and online training programs, related to topics such as compliance, professional development and diversity, equity and inclusion. In addition, leadership development hours are included in 2020 onwards. 3 Officer-level data is calculated using the job categories: executives, senior managers, mid-level managers and first-level managers. 4 Positions that had been open for 90 days or longer as of December 31st of respective year. $676 Approximately 1% 2020 40 $717 Approximately 1% 2021 320 20% 28% $7,000 $5,500 22 92#93A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX COMMUNITIES Social investment Moody's Foundation grants¹ Moody's charitable contributions² Value of volunteer hours³ Number of employee volunteer hours Employee-driven giving4 Total social investment WEF Prosperity: total social investment ($) Moody's Foundation Programs GRI 413-2 Empowering people with financial knowledge Invested $ Number of countries served Median efficacy rate Total beneficiaries Female beneficiaries Supporting social equality and climate action Invested $ Number of countries served Median efficacy rate Total beneficiaries Female beneficiaries 2019 2020 $3,100,000 $3,832,400 $1,077,500 $1,935,500 $874,300 $581,400 7,842 $532,500 $555,300 $5,584,300 $6,904,600 Moody's 2021 Stakeholder Sustainability Report 93 2021 $3,113,900 $1,859,600 $789,900 11,238 $667,000 $6,430,400 $1.4 million $1.2 million $1.6 million 35 22 29 95% 88% 96% 8,700 2,500 4,900 79% 64% 65% $355,000 40 100% 108,000 53% $352,000 30 100% 60,000 68% 1 Grants paid from the Foundation toward projects aligned with its strategic focus areas. 2 Payments made by MIS, MA and MSS that have been classified as charitable contributions. Includes charitable contributions to volunteering vendors (nonprofits and social enterprises that coordinate volunteer experiences), previously reported separately. 3 The data represents approximately 90% of employees (excludes certain non-wholly-owned subsidiaries and newly acquired companies not integrated in Moody's IT systems). In addition, RMS is in the process of integration and will be reported in this metric next year. 4 Grants paid from Moody's Foundation toward the Matching Gifts and Dollars for Doers programs. 5 Measured using Mission Measurement's Impact Genome Project methodology. Data is reflective of programming that was active in the calendar year and is not reflective of all Moody's grant partners. $308,000 37 100% 62,000 57%#94A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX COMMUNITIES (continued) Moody's Foundation Programs¹ (continued) GRI 413-2 Helping young people reach their potential Invested $ Number of countries served Median efficacy rate Total beneficiaries Female beneficiaries All programs Invested $ Number of countries served Median efficacy rate Total beneficiaries Female beneficiaries Low-income beneficiaries Improved general employability & soft skills outcome (previously "Job readiness") COVID-19 RESPONSE In-kind: products and services² 1 Measured using Mission Measurement's Impact Genome Project methodology. Data is reflective of programming that was active in the calendar year and is not reflective of all Moody's grant partners. 2 Value of complimentary content, trials of MA products, new and pro bono products and services made available to the public. Cumulative number includes calendar years 2020 and 2021. 2019 2020 Moody's 2021 Stakeholder Sustainability Report 94 2021 $1.2 million $1.1 million $1.1 million 63 49 7 94% 96% 100% 96,000 17,000 10,000 54% 66% 75% $3 million $2.7 million $3 million 99 72 54 99% 100% 100% 212,700 79,500 76,900 54% 68% 60% 30% 84% 62% 52% 96% 85% 2020 2021 $22,500,000#95A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX EEO-1 REPORT The information below mirrors the anticipated annual submission of Moody's EEO-1 Report to the U.S. Equal Opportunity Commission and reflects demographics in the United States as of December 31, 2021. The EEO-1 Report is reflective of a specific point in time and requires the use of specific job classifications, which do not necessarily reflect how Moody's Corporation organizes its workforce. Moody's purpose is to bring clarity, knowledge and fairness to an interconnected world. Moody's success in achieving its purpose is only possible through the collective contributions of its global employee population whose members possess the unique combination of skills, professional experience and diversity of backgrounds needed to advance Moody's business and contribute to the communities in which it operates. Moody's believes that it is essential to: i) create a workplace where its employees feel valued and inspired; ii) to provide an environment that fosters a culture of independence, inclusion and intellectual leadership; and iii) to support peer collaboration and professional growth. To learn more about Moody's DE&I strategy and initiatives, please visit about.moodys.io/diversity. HISPANIC OR LATINO NOT-HISPANIC OR LATINO Moody's 2021 Stakeholder Sustainability Report 95 Male Female JOB CATEGORIES Male Female White Black or African American Native Hawaiian or Pacific Islander Asian American Indian or Alaskan Native Two or More White Races Black or African American Native Hawaiian or Pacific Islander Asian American Indian or Alaskan Native OVERALL TOTALS Two or More Races Executive / Sr Officials & MGRS 0 1 21 1 0 3 0 0 10 0 0 0 0 1 37 First / Mid Officials & MGRS 44 40 455 27 2 205 0 11 238 21 0 114 0 6 1,163 Professionals 102 83 883 81 1 618 0 36 484 71 1 521 1 26 2,908 Technicians 4 0 7 4 0 3 0 0 0 0 0 0 0 0 18 Sales Workers 18 10 179 23 2 12 0 8 64 10 0 8 4 338 Administrative Support 15 44 73 24 0 9 0 4 111 58 1 19 0 11 369 Craft Workers 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Operatives 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Laborers & Helpers 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Service Workers 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL¹ 183 178 1,618 160 5 850 0 59 907 160 2 662 1 48 4,833 PREVIOUS REPORT TOTAL 153 148 1,448 133 6 736 1 48 782 132 2 611 1 38 4,239 Moody's is an equal opportunity employer. For Moody's full policy, see Moody's Affirmative Action and Equal Employment Opportunity Policy Statement. 1 This representation data is collected from all U.S. employees of Moody's Corporation and its subsidiaries and does not include information regarding the Company's international employees.#96A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 96 CE BETTER SOLUTIONS L ESG SOLUTIONS AND ESG INTEGRATION Moody's Product Vitality index' WEF Prosperity: vitality index New products² Acquired products Legacy products 1 The revenue breakdown from new products and products from acquisitions in the last five years, excluding joint ventures. 2 New products include revenue from product expansion to new markets. 2020 2021 2% 2% 12% 13% 86% 85%#97A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 97 Framework Index Our Report has been prepared in accordance with the following voluntary frameworks and initiatives: Value Reporting Foundation's Sustainability Accounting Standards Board (SASB) Standard for Professional and Commercial Services, the Global Reporting Initiative (GRI) Standards Core option, and the World Economic Forum (WEF) International Business Council's Stakeholder Capitalism Metrics. These disclosures are meant to assist our investors, customers, business partners and other stakeholders in obtaining standardized disclosure. Additionally, we have mapped our sustainability progress to the United Nations (UN) Sustainable Development Goals (SDGs) as indicated by icons listed beneath framework descriptions. The following key shows the icons used in this Index wherever it maps with an SDG: 1 NO POVERTY 2 3 HUNGER GOOD HEALTH AND WELL-BEING 4 QUALITY EDUCATION 5 EQUALITY 6 CLEAN WATER AND SANITATION 7 AFFORDABLE AND CLEAN ENERGY 8 DECENT WORK AND ECONOMIC GROWTH 9 INDUSTRY, INNOVATION SSS W 1 2 3 4 LO 5 6 7 8 9 10 REDUCED INEQUALITIES 11 SUSUUNABLE CITIES AND COMMUNITIES 12 RESPONSIBLE CONSUMPTION AND PRODUCTION 13 ACTION 14 BELOW MATER 15 LIFE ONLAND 16 PEACE JUSTICE AND STRONG 17 PARTNERSHIPS FOR THE GOALS 10 11 12 13 14 15 16 17 Unless otherwise noted, this document covers all of Moody's Corporation (NYSE: MCO) and its subsidiaries, and all quantitative data covers the period from January 1 to December 31, 2021.#98A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Organizational profile Organization name Activities, brands, products, and services Location of headquarters Location of operations Ownership and legal form Markets served and scale of the organization Information on employees and other workers MOODY'S RESPONSE Moody's Corporation (Moody's) Moody's at a glance, pg 6-7 Our commitment to sustainability, pg 10-13 Better solutions, pg 74-83 2021 Form 10-K, pg 11-14 7 World Trade Center in New York, New York, USA. 2021 Form 10-K, exhibit 21 Moody's is a public corporation. 2021 Form 10-K, pg 1 Moody's at a glance, pg 6 2021 Form 10-K, pg 11-14; pg 16-17; pg 72-78 Inside Moody's: our workforce and workplace, pg 45-46 GRI SASB WEF 102-1 102-2 102-3 102-4 102-5 102-6, 102-7 102-8 Supply chain Responsible sourcing, pg 34-36 102-9 Supplier Code of Conduct Human Rights Statement Modern Slavery and Human Trafficking Statement Significant changes to the organization and its supply chain 2021 Form 10-K, pg 11-14; pg 20 About this report, pg 9 102-10 Responsible sourcing, pg 34-36 Precautionary principle or approach 2022 Proxy Statement, pg 3-4; pg 36-37 Risk management, pg 27 Climate, pg 28-33 2021 TCFD Report 102-11 Moody's 2021 Stakeholder Sustainability Report 98 Principles of governance: setting purpose#99A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Organizational profile (continued) External initiatives and membership of associations MOODY'S RESPONSE Contributing to United Nations SDGs, pg 13 Stakeholder engagement, pg 18 Partnering for climate impact, pg 29 Creating opportunities for racial equity, pg 55-56 Communities, pg 70-73 Educating markets through outreach, pg 79 Strategy Statement from senior decision-maker Key impacts, risks and opportunities President and CEO Message, pg 3 Materiality assessment, pg 14 Corporate governance, pg 22 Risk management, pg 27 Better solutions, pg 74-83 2021 TCFD Report 2021 Form 10-K, pg 21-24; pg 27-37 2022 Proxy Statement, pg 14-15 Ethics and integrity Values, norms and reporting mechanisms 15 Moody's at a glance, pg 6-7 Ethics and integrity, pg 25-26 Code of Business Conduct MIS Code of Professional Conduct Supplier Code of Conduct Human Rights Statement GRI 102-12, 102-13 SASB WEF Moody's 2021 Stakeholder Sustainability Report 99 102-14 Principles of governance: purpose-led management 102-15 Principles of governance: integrating risk and opportunity into business process 102-16, 102-17 SV-PS-510a.1 Principles of governance: protected ethics advice and reporting mechanisms#100A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Governance Governance structure and executive oversight Composition and diversity of the highest governance body Chair of the highest governance body Nominating and selecting the highest governance body 5 16 Conflicts of interest 13 MOODY'S RESPONSE Corporate governance, pg 22 2022 Proxy Statement, pg 6; pg 9-10; pg 14-15; pg 17-21 Charter Documents 2022 Proxy Statement, pg 3 Director and Shareholder Affiliation Policy 2022 Proxy Statement, pg 11 2022 Proxy Statement, pg 9-10; pg 27-28 2022 Proxy Statement, pg 12-13; pg 22-23; pg 27 Role and performance of highest governance body in setting purpose, managing impacts and risks 14 Collective knowledge of the highest governance body Evaluating the highest governance body's performance ESG in capital allocation framework Code of Ethics for Chief Executive and Senior Financial Officers Director and Shareholder Affiliation Policy Corporate governance, pg 22-24 Sustainability strategy, pg 12 Risk management, pg 27 2022 Proxy Statement, pg 6; pg 14-15; pg 17-21 Audit Committee Charter 2021 TCFD Report Board expertise and education, pg 23 2022 Proxy Statement, pg 10-11 2022 Proxy Statement, pg 14 Better solutions, pg 74-83 2021 TCFD Report GRI 102-18, 102-19, 102-20, 102-21 102-22, 405-1 102-23 102-24 102-25 SASB WEF Moody's 2021 Stakeholder Sustainability Report 100 Principles of governance: governance body composition 102-26, 102-29, 102-30 Principles of governance: purpose-led management Principles of governance: setting purpose 102-27 102-28 Principles of governance: ESG in capital allocation framework#101A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Governance (continued) Review of economic, environmental, and social topics Highest governance body's role in sustainability reporting Communicating critical concerns MOODY'S RESPONSE Corporate governance, pg 22-24 Audit Committee Charter The CFO formally reviews Moody's Stakeholder Sustainability Report. Code of Business Conduct pg 11-13 2022 Proxy Statement, pg 15-16 GRI SASB WEF 102-31 102-32 102-33 Nature and total number of critical concerns All material legal matters are disclosed in Moody's 2021 Form 10-K, Note 21 "Contingencies," pg 126 102-34 Remuneration policies 13 Embedding sustainability metrics into executive compensation, pg 24 2022 Proxy Statement, pg 22-26; 38-59 102-35, 102-36, 102-37 Annual total compensation ratio Stakeholder engagement Approach to stakeholder engagement and key topics Compensation and Human Resources Committee Charter 2022 Proxy Statement, pg 74 102-38, 102-39 Moody's key stakeholders are entities or individuals who are involved in its business, can be directly affected by its business and/or whose actions can directly affect its business. 102-40, 102-42, 102-43, 102-44 Materiality assessment, pg 14-17 Collective bargaining agreements Reporting practice Entities included in the consolidated financial statements Report boundaries Material topics Stakeholder engagement, pg 18 Approximately 9% of employees are covered by a collective bargaining agreement. 2021 Form 10-K, exhibit 21 About this report, pg 9 Restatement of information Changes in reporting Materiality assessment, pg 14-17 Methodology Note Methodology Note About this report, pg 9 102-41 102-45 102-46 102-47 102-48 102-49 Moody's 2021 Stakeholder Sustainability Report 101 SV-PS-510a.2 Principles of governance: monetary losses from unethical behavior Principles of governance: remuneration People: wage level (%) People: pay gap (%, #) Principles of governance: material Issues impacting stakeholders People: freedom of association and collective bargaining at risk (%) Principles of governance: material issues impacting stakeholders#102A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION MOODY'S RESPONSE GRI SASB WEF Date of most recent report Reporting practice (continued) Reporting period About this report, pg 9 102-50 Our most recent report, the 2020 Stakeholder Sustainability Report, was released in June 2021. Annual 102-51 102-52 [email protected] 102-53 Reporting cycle Contact point for questions regarding the report Claims of reporting in accordance with the GRI Standards GRI content index External assurance Economic performance Management approach to economic performance Direct economic value generated and distributed 8 This report has been prepared in accordance with the GRI Standards: Core option. Moody's 2021 Stakeholder Sustainability report framework index, pg 97-107 2021 TCFD Report, pg 34-36 2021 Form 10-K, pg 41-67 Better solutions, pg 74-83 2021 Form 10-K, pg 72-75; pg 118-120 102-54 102-55 102-56 Financial implications and other risks and opportunities due to climate change 13 Innovation Materiality assessment, pg 14 Risk management, pg 27 Better solutions, pg 74-83 2021 TCFD Report 2021 Form 10-K, pg 18; pg 32 Better solutions, pg 74-83 Moody's 2021 Stakeholder Sustainability Report 102 GRI 201: 103-1, 103-2, 103-3 Prosperity: social value generated (%) 201-1 201-2 Prosperity: total tax paid Prosperity: additional tax remitted Prosperity: total tax paid by country for significant locations Prosperity: financial investment contribution Prosperity: economic contribution Principles of governance: integrating risk and opportunity into business process Planet: TCFD implementation Planet: impact of GHG emissions Prosperity: total R&D expenses ($) Prosperity: vitality index Principles of governance: progress against strategic milestones#103A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Professional integrity Management approach to ethics, integrity and anti-corruption MOODY'S RESPONSE Ethics and integrity, pg 25-26 Code of Business Conduct MIS Code of Professional Conduct Anti-Bribery and Anti-Corruption Policy Human Rights Statement Supplier Code of Conduct GRI SASB WEF Moody's 2021 Stakeholder Sustainability Report 103 GRI 205: 103-1, 103-2, 103-3 SV-PS-510a.1 Principles of governance: anti-corruption Principles of governance: protected ethics advice and reporting mechanisms Communication and training about anti-corruption policies and procedures Public policy Modern Slavery and Human Trafficking Statement Ethics and integrity, pg 25 Reporting mechanisms, pg 26 Code of Business Conduct, pg 11-12 Management approach to public policy Public policy, pg 26 engagement Lobbying and political contributions 18 Human rights Management approach to human rights Employee training on human rights policies or procedures Political Engagement and Public Policy Statement Public policy, pg 26 Political Engagement and Public Policy Statement Human rights, pg 25 Responsible sourcing, pg 34-36 Human Rights Statement Code of Business Conduct, pg 15 Supplier Code of Conduct Modern Slavery and Human Trafficking Statement Ethics and integrity, pg 25-26 Responsible sourcing, pg 34-36 Human Rights Statement Modern Slavery and Human Trafficking Statement 205-2 SV-PS-510a.1 Principles of governance: anti-corruption GRI 415: 103-1, 103-2, 103-3 415-1 Principles of governance: alignment of strategy and policies to lobbying GRI 412: 103-1, 103-2, 103-3 People: risk for incidents of child, forced or compulsory labor People: human rights review, grievance impact and modern slavery (#, %) 412-2#104A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 104 DESCRIPTION Climate and the environment Management approach to energy and emissions Energy consumption and GHG emissions Waste 8 12 13 14 15 Supplier environmental assessment Management approach to supplier environmental standards and evaluation New suppliers that were screened using environmental criteria Supplier social assessment Management approach to supplier social standards and evaluation New suppliers that were screened using social criteria 5 8 16 MOODY'S RESPONSE Climate, pg 28-33 2021 TCFD Report Decarbonization Plan Environmental Sustainability Policy Climate metrics and targets, pg 30 2021 Stakeholder Sustainability metric summary, pg 85-86 2021 TCFD Report, pg 28-31 Environment and natural resources, pg 33 Environmental Sustainability Policy Responsible sourcing, pg 34-36 Decarbonization Plan Supplier Code of Conduct Responsible sourcing, pg 34-36 Responsible sourcing, pg 34-36 Supplier Code of Conduct Human Rights Statement Modern Slavery and Human Trafficking Statement Responsible sourcing, pg 34-36 GRI GRI 302 and 305: 103-1, 103-2, 103-3 302-1, 302-3, 302-4, 305-1, 305-2, 305-3, 305-4, 305-5 306-3, 306-4, 306-5 GRI 308: 103-1, 103-2, 103-3 308-1 SASB WEF Planet: TCFD implementation Planet: impact of GHG emissions Principles of governance: progress against strategic milestones Planet: greenhouse gas (GHG) emissions Planet: Paris-aligned GHG emissions targets Principles of governance: progress against strategic milestones GRI 414: 103-1, 103-2, 103-3 People: risk for incidents of child, forced or compulsory labor 414-1 People: human rights review, grievance impact and modern slavery (#, %)#105A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Data security and customer privacy Management approach to data security and customer privacy Incidents related to customer data and cybersecurity breaches Diversity, equity and inclusion Management approach to diversity, equity, and inclusion 8 Diversity of the governance body and employees 5 8 MOODY'S RESPONSE Cybersecurity and data privacy, pg 37-38 Moody's privacy notices are publicly available online and listed under Additional Resources, pg 109 There were no material incidents related to data and cybersecurity breaches across our global operations in 2021.1 Cybersecurity monitoring and assessments, pg 37 Diversity, equity and inclusion, pg 41-57 Equal Employment Opportunity Policy Code of Business Conduct, pg 15-17 Human Rights Statement Board demographics, pg 23 Inside Moody's: our workforce and workplace, pg 45-46 GRI SASB WEF GRI 418: 103-1, 103-2, 103-3 SV-PS-230a.1 SV-PS-230a.2 SV-PS-230a.3 418-1 GRI 405 and 406: 103-1, 103-2, 103-3 405-1 SV-PS-330a.1 SV-PS-000.A Ratio of basic salary and remuneration of women to men Advocating for pay equity, pg 47 Equal compensation, pg 68 1 A material incident is defined as "affecting critical systems or information with potential or confirmed significant impact to revenue, reputation or customers." 405-2 Moody's 2021 Stakeholder Sustainability Report 105 Principles of governance: progress against strategic milestones People: discrimination and harassment incidents (#) and the total amount of monetary losses ($) People: diversity and inclusion (%) Principles of governance: governance body composition Principles of governance: progress against strategic milestones People: pay equality (%) Prosperity: pay gap (%, #) People: wage level (%)#106A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Talent attraction and development MOODY'S RESPONSE Management approach to talent attraction, education and development Employee training and upskilling, pg 58-62 Employee training and upskilling 4 5 8 10 Training by numbers, pg 61 Performance review Unfilled positions Employment GRI GRI 404: 103-1, 103-2, 103-3, 404-1, 404-2 Performance management: Grow, Perform, Succeed, pg 62 404-3 As of December 31, 2021, approximately 320 positions had been open with offers not accepted yet for 90 days or longer. Management approach to employment Better lives, pg 39-73 Benefits Benefits, pg 68-69 3 5 8 New employees and turnover 5 8 10 Employee turnover, new hires and open positions, pg 66 GRI 401: 103-1, 103-2, 103-3 401-2, 401-3, 403-6 401-1 SASB WEF Moody's 2021 Stakeholder Sustainability Report 106 People: monetized impacts of training – Increased earning capacity as a result of training intervention (%, $) People: training provided (#, $) People: number of unfilled skilled positions (#, %) Prosperity: absolute number and rate of employment SV-PS-330a.2 Prosperity: absolute number and rate of employment#107A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX DESCRIPTION Health and well-being Management approach to employee health and well-being 3 8 16 MOODY'S RESPONSE Continuing our support throughout the COVID-19 pandemic, pg 8 Employee health and well-being, pg 63-69 Empowering our people: Business Resource Groups, pg 44 Code of Business Conduct, pg 18 Worker training on occupational health and safety Our Code of Conduct, pg 25 Empowering our people: Business Resource Groups, pg 44 Placing employee well-being at the center of how we work, pg 63-64 Code of Business Conduct, pg 18 Work-related injuries and ill-health 3 8 16 Ensuring health and safety of employees, pg 67 Local communities Management approach to community engagement and social impact Operations with local community engagement, impact assessments, and development programs Operations with significant actual and potential negative impacts on local communities Communities, pg 70-73 Communities, pg 70-73 Since we do not have factories or large operating facilities, and our operations do not require large amounts of land or resources from the communities in which we operate, our local community impacts are limited. Read more on our community engagement initiatives (in our workplace and externally through our business and philanthropy) in Communities, pg 70-73. GRI SASB WEF Moody's 2021 Stakeholder Sustainability Report 107 GRI 403: 103-1, 103-2, 103-3; 403-1, 403-2, 403-3, 403-4, 403-6, 403-7, 403-8 SV-PS-330a.3 People: health and safety (%) People: employee well-being (%) 403-5 403-9, 403-10 GRI 413: 103-1, 103-2, 103-3 413-1 413-2 People: health and safety (%) People: monetized impacts of work-related incidents on organization (#, $) People: employee well-being (%) Prosperity: total social investment ($) Prosperity: significant indirect economic impacts#108A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 108 Glossary GRI- Global Reporting Initiative M&A - Mergers & acquisitions MA - Moody's Analytics MCO - Moody's Corporation MIS - Moody's Investors Service SASB - Sustainability Accounting Standards Board SDG - Sustainable Development Goals UNGC United Nations Global Compact WEF - World Economic Forum BETTER BUSINESS A4S - Accounting for Sustainability AML - Anti-Money Laundering CIO - Chief Information Office CISO - Chief Information Security Officer COSO - Committee of Sponsoring Organizations CRO-Chief Risk Officer EDD Enhanced Due Diligence NZFSPA - Net Zero Financial Service Providers Alliance GFANZ - Glasgow Financial Alliance for Net Zero LEED - Leadership in Energy and Environmental Design PAC - Political Action Committee SBTI - Science-Based Targets initiative TCFD - Task Force on Climate-related Financial Disclosures TNFD-Taskforce on Nature-related Financial Disclosures (888) BETTER LIVES ALI - Asian Leadership Initiative BES - Business Engagement Survey BIG Black Inclusion Group - BLC - Business Learning Councils BRG - Business Resource Group (previously Employee Resource Group) CDFI - Community Development Financial Institution CPO-Chief People Officer CSR - Corporate Social Responsibility CORE - Creating Opportunities for Racial Equity EEO-1-U.S. Equal Employment Opportunity report ERG - Employee Resource Group (now Business Resource Group) GPS Grow, Perform, Succeed MATR - Moody's Analytics Technical Rotation program MDI - Minority Depository Institution MLT - Management Leadership for Tomorrow MMCI - Moody's Multicultural Customer Initiative TIDE - Talent Aspirations & Alignment, Insights, Development & Career Planning and Exposure & Expansion UNCF - The United Negro College Fund WBRG Women Business Resource Group BETTER SOLUTIONS CBI - Climate Bonds Initiative CIS - Credit Impact Score CRE - Commercial Real Estate CTA Carbon Transition Assessment = IPS - Issuer Profile Score KYC - Know Your Customer PD - Probability of Default SFDR PAI - Sustainable Finance Disclosure Regulation Principal Adverse Impact SME-Small-and-Medium-sized Enterprise SPO-Second Party Opinion#109A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX Moody's 2021 Stakeholder Sustainability Report 109 Additional Resources 2021 Annual Report 2021 Form 10-K 2020 Stakeholder Sustainability Report Investor Relations website Methodology Note Stakeholder Sustainability microsite BETTER BUSINESS 2022 Proxy Statement 2021 TCFD Report Anti-Bribery and Anti-Corruption Policy Code of Business Conduct Code of Ethics for Chief Executive and Senior Financial Officers Corporate Governance Charter Documents Decarbonization Plan Director and Shareholder Affiliation Policy Environmental Sustainability Policy Human Rights Statement MIS Code of Professional Conduct Modern Slavery and Human Trafficking Statement Political Engagement & Public Policy Statement Privacy Policy >>> Bureau van Dijk Privacy Policy >>> Bureau van Dijk Product Privacy Notice >>> Bureau van Dijk RDC Product Privacy Notice » Canadian Securities Institute Cookies Notice (888) BETTER LIVES 2020 Diversity, Equity and Inclusion Report 2020 EEO-1 Report Affirmative Action and Equal Employment Opportunity Policy Corporate Social Responsibility microsite Diversity, Equity & Inclusion microsite Gender & Finance Research Hub Moody's Careers website Moody's Foundation website >>> Canadian Securities Institute Privacy Policy >>> Catylist Privacy Policy MA Pulse Privacy Policy » MA NewsEdge Privacy Policy >>> Moody's Cookies Notice » Moody's Talent Community Privacy Notice >>> PassFort Privacy Policy >>> RealXData Privacy Policy >>> RealXData Cookies Notice RMS Privacy Policy Supplier Code of Conduct BETTER SOLUTIONS ESG & Climate Solutions microsite ESG Insights & Analysis hub#110A MESSAGE FROM OUR PRESIDENT & CEO 2021 SUSTAINABILITY HIGHLIGHTS ABOUT MOODY'S BETTER BUSINESS BETTER LIVES BETTER SOLUTIONS APPENDIX 2021 Assurance Statement: Human Capital Data LRQA LRQA Table 1. Summary of Moody's Key Data for CY 2021: LRQA Independent Assurance Statement Relating to Moody's Assertion for the Calendar Year 2021 This Assurance Statement has been prepared for Moody's Corporation (Moody's) in accordance with our contract. Terms of Engagement LRQA was commissioned by Moody's to provide independent assurance of its social metrics for the calendar year 2021 (CY 2021) against the assurance criteria below to a limited level of assurance and materiality of the professional judgement of the verifier using LRQA's verification procedure. LRQA's verification procedure is based on current best practise and is in accordance with ISAE 3000. Our assurance engagement covered Moody's employees under its operational control and specifically the following requirements: • Verifying conformance with: Moody's reporting methodologies for the selected datasets. Evaluating the accuracy and reliability of data and information for only the selected indicators listed below: Global gender data as reported within Moody's CY 2021 10-K, specifically female officers and managers; and U.S race and ethnicity data stated within Moody's CY 2021 EEO-1 Report as published in Moody's Stakeholder Sustainability Report, specifically Black or African American employees. LRQA's responsibility is only to Moody's. LRQA disclaims any liability or responsibility to others as explained in the end footnote. Moody's responsibility is for collecting, aggregating, analysing and presenting all the data and information within the Assertion and for maintaining effective internal controls over the systems from which the Assertion is derived. Ultimately, the Assertion has been approved by, and remains the responsibility of Moody's. LRQA's Opinion Based on LRQA's approach nothing has come to our attention that would cause us to believe that Moody's has not, in all material respects: . • Met the requirements of the criteria listed above; and Disclosed accurate and reliable demographic data and information as summarized in Table 1 below. The opinion expressed is formed on the basis of a limited level of assurance¹ and at the materiality of the professional judgement of the verifier. 1. The extent of evidence-gathering for a limited assurance engagement is less than for a reasonable assurance engagement. Limited assurance engagements focus on aggregated data rather than physically checking source data at sites. Consequently, the level of assurance obtained in a limited assurance engagement is lower than the assurance that would have been obtained had a reasonable assurance engagement been performed. Metric Black or African American employees²,3 Female officers or managers Absolute Boundary Count¹ Total Absolute Count¹ Percent of Employees U.S. 320 4,833 6.6% Global 2,041 5,678 36% Note 1: Absolute counts are derived from the number of active employees on December 31, 2021. Note 2: As defined in 2021 U.S. EEO-1 Component Booklet, Appendix D. Note 3: Percent of employees was calculated using absolute total count of employees in the U.S. Note 4: Percent of employees is calculated using absolute total count of global employees in officer and manager roles: executives, senior managers, mid-level managers and first-level managers. LRQA's Approach LRQA's assurance engagements are carried out in accordance with our verification procedure. The following tasks were undertaken as part of the evidence gathering process for this assurance engagement: • • interviewing relevant employees of the organization responsible for managing social data and records; and assessing Moody's data management systems to confirm they are designed to prevent significant errors, omissions or mis-statements. LRQA's Standards, Competence, and Independence LRQA implements and maintains a comprehensive management system that meets accreditation requirements for ISO/IEC 17021 Conformity assessment - Requirements for bodies providing audit and certification of management systems that are at least as demanding as the requirements of the International Standard on Quality Control 1 and comply with the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants. LRQA ensures the selection of appropriately qualified individuals based on their qualifications, training and experience. The outcome of all verification and certification assessments is then internally reviewed by senior management to ensure that the approach applied is rigorous and transparent. Signed Kate Pagan Kate Pagan LRQA Lead Verifier On behalf of LRQA, 1330 Enclave Parkway, Suite 200 Houston, TX 77077 LRQA reference: UQA00002158/5401274 Dated: 08 September 2022 LRQA Group Limited, its affiliates and subsidiaries, and their respective officers, employees or agents are, individually and collectively, referred to in this clause as 'LRQA'. LRQA assumes no responsibility and shall not be liable to any person for any loss, damage or expense caused by reliance on the information or advice in this document or howsoever provided, unless that person has signed a contract with the relevant LRQA entity for the provision of this information or advice and in that case any responsibility or liability is exclusively on the terms and conditions set out in that contract. The English version of this Assurance Statement is the only valid version. LRQA assumes no responsibility for versions translated into other languages. This Assurance Statement is only valid when published with the Assertion to which it refers. It may only be reproduced in its entirety. Copyright © LRQA, 2022. Page 1 of 2 See the assurance statement for 2021 environmental data in Moody's 2021 TCFD report, p. 34 Page 2 of 2 Moody's 2021 Stakeholder Sustainability Report 110#111MOODY'S To learn more, please visit moodys.com/sustainability or contact us at [email protected] Certain statements in this report are aspirational or otherwise forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. These statements, including statements regarding the goals of Moody's Corporation and its subsidiaries (the "Company"), are not guarantees of future results or occurrences. Actual results and financial condition may differ materially from the Company's expectations or predictions expressed in this report due to a variety of factors, including, among others, global socio-demographic, political and economic trends, technological innovations, climate-related conditions and weather events, legislative and regulatory changes and other unforeseen events or conditions, and the factors discussed in the precautionary statements included in this report and those contained in the Company's filings with the Securities and Exchange Commission. The forward-looking statements are made as of the date of this report, and the Company undertakes no obligation to publicly supplement, update or revise such statements on a going-forward basis, whether as a result of subsequent developments, changed expectations or otherwise, except as required by law. In addition, while this report describes potential future events that may be significant, the significance of those potential events should not be read as equating to materiality as the concept is used in the Company's filings with the Securities and Exchange Commission. Forward-looking and other statements in this report may also address our corporate responsibility progress, plans, and goals (including sustainability and environmental matters), and the inclusion of such statements is not an indication that these contents are necessarily material to investors or required to be disclosed in the Company's filings with the Securities and Exchange Commission. In addition, historical, current, and forward-looking sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future. BX13289