[Updated Thursday with comments from Fitch] Credit ratings agencies reacted favorably to rules proposed by the Securities and Exchange Commission that would fundamentally change how the firms manage internal controls and public disclosures on securities ratings. The SEC is giving the agencies 60 days to comment on guidelines that would require companies, like Standard and Poor’s, Fitch Ratings and Moody’s Investors Service, to add more internal ratings oversight, while also eliminating conflicts of interest between their sales and ratings departments. Among a series of other reforms, the proposed rules would require agencies to file annual reports disclosing the effectiveness of their internal ratings controls and the overall effectiveness of issued ratings. They also call for standards of professional training for analysts. “S&P supports the SEC’s efforts to increase accountability, transparency and oversight of credit rating firms while maintaining analytical independence,” the agency said in a statement. “As for today’s proposed rules, S&P already has taken many steps such as ‘look back’ reviews, an analyst certification program and publicly available criteria and default studies.” Look-back reviews are a major part of the SEC’s proposal since the reviews force agencies to analyze any ratings issued by employees who leave the firm to work for an issuer of the rating within a 12-month period. Moody’s Investors Service responded to the guidelines saying it believes “regulatory change is healthy for the market.” The firm added, “We are committed to embracing that change to implementing provisions specific to our industry as effectively as possible.” Fitch responded, saying,”We look forward to reviewing the details of the proposed rules and to sharing our feedback with the SEC and the market. Based on what was discussed at today’s open meeting, the proposed rules seem consistent with Dodd-Frank and largely reflect constructive changes already in place at Fitch.” The agency added, “The markets must have clear and consistent rules for credit rating agencies, and a proper regulatory framework will ensure investors have confidence in the rating process.” The SEC ratings agency rules will impact more than the big three ratings agencies. The guidelines mandate that all firms classified as “nationally recognized statistical rating organizations” comply with the reforms. At the moment, there are 10 companies registered as such with the SEC. Write to: Kerri Panchuk.