As the government has determined that the corporate bond market will have to become the main medium and long-term capital channel for the economy, to achieve that goal, the current shortcomings in the market need to be resolved with fundamental measures such as promoting the role of domestic credit ratings among bond issuers. 

Any corporate bond market needs three key groups of factors for sustainable development, according to Mr. Matthew Batrouney, Managing Director and Head of South & South East Asia and APAC Sustainable Finance and ESG Coverage at S&P Global Ratings.

The first is on the supply side, which is to standardize issuance conditions so that large enterprises with high capital mobilization demand can diversify capital mobilization channels for development. The second is on the demand side, which is to develop a diversified and well-informed investor base. And the third is about the role of intermediary institutions as well as the hard and soft infrastructure for that market to develop.

In addition to regulations on issuance, the government should also consider encouraging institutional investors such as banks, insurance companies, investment funds, pension funds, financial companies, and others to gradually apply credit rating results in investment allocation activities and select products suitable to the operating model and appropriate risk management standards towards good practice in the world. These are two factors that create a premise for the market to accept credit rating activities and build a healthy credit rating culture.