Rob Fauber : Yes. So Craig, we always kind of target across the company kind of a 3% to 4% kind of annual price increase. And I think we talked about a little bit on the last call, but what we do in MIS, every year, we do a very detailed review of pricing across sectors and regions. And based on that, we come out with our list prices for the following year. And I think you can expect our list prices for 2023 are going to be a little bit higher than the rate of increase, a little bit higher than maybe it has been historically. But the realization of that will depend on mix, right, where the issuance actually comes from.
Craig Huber : And the MA side, what’s the pricing there, you think, on average for this year?
Rob Fauber : I’d say it’s within that range.
Operator: And we have a follow-up question from the line of Kevin McVeigh from Credit Suisse.
Kevin McVeigh : Hey, Rob, you’ve done a really nice job remixing the business and MA has kind of crossed the 50% threshold. If you look out three to five years, how should we think about what the business looks like? And I don’t know if there’s a way to maybe frame that organically versus inorganic? I mean, start to kind of parse deals and things, but maybe give us an organic view of kind of where the business sits three to five years from now?
Rob Fauber : Yes. Kevin, that’s an interesting question. And I guess I might start by saying when we think about integrated risk assessment, it’s not just MA. It’s all of Moody’s. The rating agency is a really important contributor to, but also beneficiary of, this integrated risk assessment strategy that we have. But maybe a few things, Kevin. First, I think you’re seeing us develop scale in a few areas beyond our ratings business. And we obviously have a world-class fixed income research business in Digital Insights that serves investors. We’ve got, in Decision Solutions, I mean, you’ve heard me talk about a little bit meaningful businesses that are supporting both banking and insurance different really critical risk workflows, origination, underwriting, portfolio and risk management and capital planning and reporting.
And then, of course, we’ve got a rapidly growing KYC business that we think has some really industry-leading capabilities. We’re really well positioned there. I think that’s where you’re going to see us continue to invest and really drive growth because those are very important delivery platforms for a range of content across all of Moody’s. And you heard me talk about kind of what’s driving ARR. And so all this fits together. When I think about that content, I mean, think about it, $70 trillion of debt rated by MIS. It’s data ownership and credit scores from 425 million companies. It’s massive economic data sets and ESG and physical risk scores on hundreds of millions of companies and locations. And we think of that as kind of our risk operating system, and we are increasingly threading that content through those scaled platforms.
And you’ve heard us talk about it but our commercial real estate lending module for banking. That takes a lot of that property and economic and climate content, and we’ve got KYC integrations that are on the way into our banking solutions. You’ve got ESG and climate integration into ratings, banking, insurance and research and so on. So I think ultimately, complementing our ratings business, we’re going to have scaled platforms with a suite of cloud-based solutions that serve key customer sets. And they’re differentiated by being able to draw on all this proprietary data and analytics that we’ve got, where and when customers need it, so that they can better identify, measure and manage risk. That’s where I think we’re going to be three to five years from now.
Operator: And there are no further questions at this time. Mr. Rob Fauber, I’d turn the call back over to you for some closing remarks.
Rob Fauber : Okay. Thanks, everybody, for joining. Appreciate the questions, and we look forward to speaking with you on the next call. Have a good day.
Operator: This concludes Moody’s Fourth Quarter and Full Year 2022 Earnings Call. As a reminder, immediately following this call, the company will post the MIS revenue breakdown under the Investor Resources section of the Moody’s IR homepage. Additionally, a replay will be made available immediately after the call on the Moody’s IR website. Thank you.
