As the federal government crafts landmark financial reform, the debt rating agencies–especially Moody's Investors Service, Standard & Poor's and Fitch–have targets pinned to their chests. For corporate treasurers, what happens to the agencies they rely on to rate their public debt and provide recognized standards for investment policies is a big deal. For better or worse, both market pressures and legislative mandates are forcing reform. So how do forward-looking treasury staffs react?

They decrease their reliance on agency ratings for investment policies. For too long, treasury staffs have neglected credit analysis for their cash investments and relied almost exclusively on agency ratings, says David Stowe, a director and practice leader for financial risk management at Strategic Treasurer in Atlanta.

"A rating is no longer sufficient," Stowe says. "We know that the agencies can get it wrong, that their ratings are sometimes out of date, and that they are not always given the proper incentives to get it right."