Powering
Global Markets
Annual Report 2022
Financial Highlights
Years ended December 31
(in millions, except per share data)
2022
2021
% Change
Non-GAAP pro forma adjusted revenue*
$11,842
$12,382
Non-GAAP pro forma adjusted net income (attributable to the Company’s
common shareholders)*
$3,765
$4,137
Non-GAAP pro forma adjusted diluted earnings per common share*
$11.19
$11.63
Dividends per common share (a)
Total assets
Capital expenditures (b)
Total debt
$3.32
$3.08
$61,784
$15,026
$89
$35
$10,956
$4,114
(4)
(9)
(4)
8
N/M
N/M
N/M
Equity (including redeemable noncontrolling interest)
$39,744
$5,536
N/M
N/M - Represents a change equal to or in excess of 100% or not meaningful
*Refer to “Reconciliation of Non-GAAP Financial Information” on pages 10-11 of this report for a discussion of the Company’s non-GAAP financial measures.
(a) Dividends paid were $0.77 per share in the first quarter of 2022 and increased to $0.85 per share beginning in the second quarter of 2022. In 2021 dividends paid
were $0.77 per quarter.
(b) Includes purchases of property and equipment and additions to technology projects.
Powering Global Markets
Powering Global Markets is our vision and a strategic framework we use to allocate capital,
channel innovation, inspire our people, and capitalize on growth opportunities. By Powering
Global Markets, we Accelerate Progress for our customers, and for the world.
Year-End Share Price
Dividends Per Share
$471.93
$328.73
$334.94
$273.05
$169.94
$3.32
$3.08
$2.68
$2.28
$2.00
Revenue/Non-GAAP
Pro Forma Adjusted
Revenue (in millions)
$12,382*
$11,842*
$7,442
$6,699
$6,258
’18
’19
’20
’21
’22
’18
’19
’20
’21
’22
’18
’19
’20
’21
’22
Cumulative Total Shareholder Return (c)
350
300
250
200
150
100
SPGI
Peer Group (d)
S&P 500
$207
$179
$157
’17
’18
’19
’20
’21
’22
(c) Assumes $100 invested on December 31, 2017 and total return includes reinvestment of dividends through December 31, 2022.
(d) The peer group consists of the following companies: Moody’s Corporation, CME Group Inc., MSCI Inc., FactSet Research Systems Inc., Verisk Analytics, Inc., and
Intercontinental Exchange, Inc.
To experience an
enriched version of this
Annual Report, with
expanded content, visit
spglobal.com/annualreport.
S&P Global 2022 Annual Report 1
Chairman’s Letter
S&P Global’s Board of Directors
and Executive Committee in
London in 2022 for the Board’s
annual strategy review session.
Dear Fellow Shareholder:
The pivotal role Europe plays on the world stage was reinforced last year as we
watched Russia’s invasion of Ukraine, related disruptions to natural gas supplies, and
a series of changes in the UK’s political landscape.
The region’s importance to S&P Global was confirmed as well. After completing
our merger with IHS Markit in early 2022, we began the critical task of integrating
teams across the continent, where we have more people than anywhere outside the
U.S. and India.
To provide the Board of Directors with a first-hand look at our European operations
and capabilities, last year we visited five European cities over the course of a week to
see our offices up close and meet employees.
Directors joined the Executive Committee in Frankfurt, London, Madrid, Milan,
and Paris. Our offices in these cities represent strategic hubs in the most important
financial markets across Europe. At each stop, the Board got to walk the floors, talk
with teams, hear their perspectives, and see new products.
We had great sessions and came away impressed with everything we saw.
As part of our visit and our responsibility providing oversight of S&P Global’s
strategic direction, the Board also met in London with the Executive Committee to
review the company’s long-term business strategy.
We discussed the many attractive opportunities for growth we have across
S&P Global. We heard about how our company is well positioned to benefit from
growing global markets and powerful secular trends. We learned about strategic
investments in innovation and technology. And we reviewed the talent, skills, and
expertise of S&P Global’s employees.
The conclusion from our visit: We are operating from a position of strength and the
Board is looking to the future with a great deal of excitement. Our opportunities are
built on the central idea that S&P Global is Powering Global Markets. This idea is
the foundation of the company’s strategy, which you will learn about throughout the
pages of this annual report.
The Board functions at maximum effectiveness when we maintain an open dialogue
not just among ourselves and with employees, but with shareholders as well. We
value our shareholders’ feedback and are committed to engaging in constructive and
meaningful dialogue with them regarding our business, governance practices, and
other areas of shareholder focus.
2 S&P Global 2022 Annual Report
We have achieved so much,
and can achieve much more in
the years ahead, because of the
contributions of many people.
This past year we continued to have productive conversations with our shareholders.
I thank them for their continued support.
We have achieved so much, and can achieve much more in the years ahead, because
of the contributions of many people.
Over the past year I’ve had the privilege to get to know the Directors who joined us
from IHS Markit. They’ve been fantastic additions. All our Directors have continued
to have substantive discussions about how to enhance the effectiveness of the Board,
and have taken steps to do so where appropriate. For example, we have added more
Board sessions on technology, cybersecurity, and ESG factors to further augment
Directors’ expertise in these areas.
I thank our Board for their effective leadership. I especially want to express my
gratitude to Bill Amelio, Monique Leroux, Kurt Schmoke, and Ed Rust,
who retired from the Board within the last year.
I also want to thank Doug and the Executive Committee for their
exceptional work managing S&P Global during another period of
extraordinary disruption around the world. The team has been,
and continues to be, adept at navigating the twists and turns of a
challenging macroeconomic environment.
The Board and I are especially grateful to everyone we met
during our trip to Europe. They exemplify many of the best
characteristics of S&P Global. They are leaders. They are experts.
They are creative. They are passionate and they are dedicated.
The way they conduct themselves is representative of people
across the organization. Thanks to all the people of our great
company, I’m as confident as ever about its future.
Sincerely,
Richard E. Thornburgh
Chairman of the Board
CEO’s Letter
To read more about
our technology-
enabled products
and innovations
visit spglobal.com/
ProductShowcase
Dear Fellow Shareholder:
In a year characterized by challenging macroeconomic conditions and a host of
geopolitical risks, S&P Global once again proved its resilience in 2022:
– We made considerable progress on our most important strategic initiative—the
transformative merger with IHS Markit. Since we closed the transaction early last
year, integration teams have been doing tremendous work aligning processes and
bringing people together, which has helped put us ahead of schedule on achieving
our synergy targets.
– Four of our six divisions produced Non-GAAP pro forma adjusted revenue growth
as we managed through difficult debt issuance and IPO markets.
– And we never stopped investing in organic growth, technology, and innovation to
deliver the next generation of exciting new products.
While our diversified business portfolio helped counterbalance a steep decline in
revenue from S&P Global Ratings, our financial performance in 2022 did not match
the previous year. And although our Non-GAAP pro forma adjusted revenue and
Non-GAAP pro forma adjusted diluted earnings per share declined year-over-
year, our disciplined approach to cost management and capital allocation, active
engagement in our markets, and strategic investments have positioned us to return
to growth in 2023.
We are also benefiting from a strong brand, which is a key differentiator in a
dynamic business environment. At S&P Global, we have leading positions that power
global markets. Our brand is trusted and reliable. We’re known for independence,
integrity, transparency, and consistency.
In early 2023, Brand Finance, a leading independent brand valuation and strategy
consultancy, noted a 31% increase in our brand’s value during 2022.
Customers and market participants in financial institutions, businesses, and
governments use or interact with our brand every day.
Anyone who watches TV news or opens any app to check how U.S. stocks are doing
will see the benchmarks S&P 500 and Dow Jones Industrial Average, and to track
global bond markets, there is our family of iBoxx™ indices.
Chief financial officers, treasurers, and others apply our credit ratings and research
to evaluate the creditworthiness of a bond or loan.
4 S&P Global 2022 Annual Report
We made considerable progress
on our most important strategic
initiative—the transformative
merger with IHS Markit.
Investors use our data and analytics to build, manage, and analyze their portfolios.
Business leaders, policy makers, and finance professionals turn to our economists or
our Purchasing Managers’ Index, or PMI™, to understand the outlook for the global
economy and business conditions.
Traders, risk managers, and a range of buyers and sellers want to know our
benchmark prices for commodities such as Dubai or Dated Brent crude oil or for
liquified natural gas.
Customers across the automotive value chain use our insights to learn about the
future of the auto sector and make critical capital investment decisions.
And leaders in the private and public sectors rely on our ESG scores, evaluations, and
indices; carbon pricing scenario analysis; and second-party opinions to
navigate the transition to a sustainable future.
S&P Global’s products and services are embedded in our
customers’ workflows. By helping our customers manage risk and
uncover opportunities, we’re driving markets forward.
It is this strong brand combined with a great team, a high level
of recurring revenue, technology, and a clear strategy that gives
us an incredibly strong foundation on which to grow.
Our Vision: Powering Global Markets
Closing the merger with IHS Markit in February of last year
presented a chance to reflect on our vision for S&P Global and
refresh our strategic framework. We define our strategic focus as
Powering Global Markets.
We realize our vision through a strategic framework with five
pillars: customer at the core, grow and innovate, expand the power
of data and technology, lead and inspire, and execute and deliver.
These elements guide how we allocate capital, channel innovation,
inspire our people, and ultimately, capitalize on the fantastic
long-term growth opportunities in each of our businesses.
Customer at the Core
I’ve been meeting with customers frequently over the past year. It’s been a
fabulous opportunity to listen to their feedback. During my visits I’ve heard three
consistent messages.
The first is that our customers are excited about the merger. Some of our best ideas
for new or enhanced product features are coming from our customers.
The second message is about data. Every company is going through a digital
transformation. Digital transformations require companies to connect their data
so it becomes more relevant. That’s something we’re doing really well. They want
to learn from us.
And the third message is about sustainability, energy transition, and climate.
Customers tell me they want new data sets, new products, and new intelligence about
sustainability issues.
We’ve been investing in innovation across the company to identify new ways of
serving customers, and it’s exciting to see those investments starting to pay off.
Grow and Innovate
In late 2022 we introduced a new level of disclosure to our organic growth initiatives:
the Vitality Index. It measures the revenue impact of innovation, including product
enhancements and new offerings, as a proportion of total revenue.
Our target is to increase the Vitality Index on an ongoing basis to more than 10% of
total revenue from 8% in 2021. I’m pleased to report we achieved that goal in 2022,
and our focus will remain on innovations with key products like thematic indices,
bond valuations, aftermarket research, mobility forecasts, and solutions for the
energy transition.
Another part of our growth story is a focus on transformational areas—areas that
are rapidly expanding. Two of the most promising business opportunities are private
markets and sustainability. We have distinct advantages in these areas because we
have assets that nobody else has, we have the technology base, we have the scale, and
we have a global sales force.
Today we generate approximately $400 million in revenue annually from
products serving private markets. We offer solutions to private equity customers,
private company data, private asset data, as well as ratings, bank loan ratings
and assessments for private entities, portfolio monitoring, fund-level data,
and benchmarking. By 2026, we expect private markets to become a $600
million business.
In the sustainability space, we have unique capabilities, particularly in climate.
Our business, branded Sustainable1, includes products that cover electric vehicles
and some energy transition products, sustainability scores on more than 10,000
companies, and sustainable versions of the S&P 400, 500, and 600 indices, among
many others. We expect this business to grow at a compounded annual growth rate
of 34% to $800 million by 2026.
Expand the Power of Data and Technology
Differentiated data and leading technology enable us to serve the evolving needs of
6 S&P Global 2022 Annual Report
We have a proven record of
execution, and I am confident our
experienced team will deliver great
results going forward.
our customers. They’re critical to our future success and that’s why we’re investing in
two categories.
First, we continue to ensure we have the highest quality approach to our own digital
infrastructure. That means putting resources behind the cloud, cybersecurity, and
data governance.
Second, we are applying more resources to help our developers and other teams with
the latest agile tools in artificial intelligence and machine learning.
We spent approximately $2 billion on technology last year. Seventy-three percent
of that was invested in infrastructure and foundational systems and the remaining
27% was invested in R&D and new technologies. To increase the value proposition
for our customers and succeed in the future, we’re shifting that mix. By 2026, we
are targeting to invest 60% of annual technology spend in infrastructure and 40%
in technology innovations focused on speeding time to market and improving the
customer experience.
Our commitment to technology and the capabilities that result from the IHS Markit
merger offer exciting opportunities to lead in the digital economy.
Lead and Inspire
There’s been no more important priority for us than creating a sense of belonging
where our people feel engaged, inspired to do great things, and are connected to our
purpose, which we express as Accelerate Progress. Over the past year we’ve invested
in making S&P Global a top place to work with career training programs, new
benefits, and a global flexible time-off approach.
Offering our people volunteer opportunities and matching gift programs to support
the causes they care about, endowing the S&P Global Foundation, the keystone of
our philanthropic initiatives, and updating our environmental goals to reduce water,
waste, and energy consumption are also critical components of S&P Global’s culture.
All these initiatives allow us to attract, retain, develop, and care for our people.
Execute and Deliver
Our teams continue to be disciplined in their approach to executing our strategy.
That means running the company efficiently, making strategic investments in high-
growth areas, pursuing a disciplined capital allocation approach, and creating an
excellent culture.
We have a proven record of execution, and I am confident our experienced team will
deliver great results going forward.
S&P Global 2022 Annual Report 7
Integration Progress
We are making substantial progress on our integration with IHS Markit.
The merger, which we detailed in last year’s annual report, is generating encouraging
conversations with our customers about the increased value we offer as a combined
company. As an example, we’ve generated 6,700 cross-sell referrals since the merger
closed, and the conversion rates are strong.
Additionally, we have standardized business practices and we’re moving fast on our
office integration plan. As of the end of last year, we’ve consolidated office space in
approximately two dozen locations. We continue to be fully focused on the execution
of our synergies. As previously disclosed, by 2026 we expect to generate $600 million
in cost synergies and $350 million in revenue synergies.
The merger has been an extraordinary opportunity for me to get on the road to
meet new teams and learn about the products they’re creating. I call it a “Day in
the Life” program. Over the past year I’ve spent time with people where they work,
getting to analyze different industries, companies, and markets, and understanding
their workflows.
As part of our disciplined approach to integration, late last year we also announced
our intent to sell the Engineer Solutions business. This is an excellent business with
strong growth prospects; however, it proved not to be the right fit for our long-term
strategy. Earlier this year, we signed an agreement to sell the business to investment
funds managed by KKR for $975 million in cash. We expect the transaction to close
by the end of the second quarter of 2023.
Positioned for Growth in the Years Ahead
We’re very confident about capturing growth opportunities in our markets. We
expressed that confidence with the mid-term financial targets we announced during
our Investor Day in December last year. We expect to achieve by 2025-2026:
– 7% to 9% organic annual revenue growth;
– An adjusted operating margin in the range of 48% to 50%;
– Low- to mid-teens annual adjusted diluted earnings per share growth; and
– Continued return of capital of at least 85% of free cash flow.
A Word of Thanks
Our people have been through a lot of change not just in 2022, but over the last
several years. I thank them for the excellent work they continue to do handling a
complex merger, market uncertainty, and the evolving dynamics of Covid. Amid
so much disruption in the world, they are a steady and resilient presence working
alongside our customers.
I especially want to express my gratitude to John Berisford, who left the company at
the end of last year. John embodied the very best in S&P Global’s values. He played
a central role in transforming our company and his leadership made so much of our
success possible.
8 S&P Global 2022 Annual Report
We are well positioned for profitable
growth in the future because of our
strong brand, powerful data and
technology, resilient business model,
trusted products, clear growth
strategy, and the talents of our
people around the globe.
I also want to recognize our Board of Directors. We have an all-star Board whose
diverse expertise, perspectives, and backgrounds are of incredible value to me
and our company.
I extend my heartfelt thanks to Ed Rust, Monique Leroux, Kurt Schmoke, and Bill
Amelio, who retired last year, for everything they’ve done to provide oversight and for
their commitment to building long-term shareholder value. It is a testament to their
contributions that our record of growth has been so consistent over many years.
Looking Ahead
Even with an uncertain global economy this year, we are well positioned for
profitable growth in the future because of our strong brand, powerful data and
technology, resilient business model, trusted products, clear growth strategy, and the
talents of our people around the globe.
For generations, the people of our company have adapted to serve the changing needs
of markets. Through every imaginable economic condition and business cycle, they
have been there for our customers. The high quality of our people will always be a
hallmark of S&P Global. It is their expertise, dedication, and enthusiasm for Powering
Global Markets that give me complete confidence our company will produce valuable
benefits for all our stakeholders in the years ahead.
Thank you for your support.
Sincerely,
Douglas L. Peterson
President and CEO
S&P Global 2022 Annual Report 9
Reconciliation of Non-GAAP Financial Information
The Company reports its financial results in accordance with accounting principles generally accepted in the United States
(“GAAP”). The following is provided to supplement certain non-GAAP pro forma adjusted financial measures discussed in the letter
to shareholders and the financial highlights section of this report (IFC-page 9) and includes financial information on an as-reported
basis, and on a pro forma basis as if the merger with IHS Markit had closed on January 1, 2021, for the twelve months ended
December 31, 2022 and 2021; the pro forma basis agrees to the Company’s previously filed unaudited pro forma combined condensed
financial information presented in accordance with Article 11 of Regulation S-X. The Company’s non-GAAP measures include
adjustments that reflect how management views our businesses. The Company believes these non-GAAP financial measures provide
useful supplemental information that, in the case of non-GAAP financial measures other than free cash flow, enables investors to
better compare the Company’s performance across periods, and management also uses these measures internally to assess the
operating performance of its business, to assess performance for employee compensation purposes and to decide how to allocate
resources. However, investors should not consider any of these non-GAAP measures in isolation from, or as a substitute for, the
financial information that the Company reports.
Operating Results - Non-GAAP Financial Information
Twelve months ended December 31, 2022 and 2021
(dollars in millions, except per share amounts)
Non-GAAP Pro Forma Adjusted Revenue
The following four of our six divisions produced Non-GAAP pro forma adjusted revenue growth:
(unaudited)
Market
Pro forma revenue *
Pro forma non-GAAP adjustments
Intelligence
Fiscal period alignment adjustment
Divestitures
2022
$4,102
—
—
(9)
$3,976
(73)
(13)
—
2021 % Change
3%
5%
8%
6%
12%
8%
8%
8%
Non-GAAP pro forma adjusted revenue *
$4,093
$3,890
Pro forma revenue *
$1,788
$1,652
Commodity
Pro forma non-GAAP adjustments
Insights
Fiscal period alignment adjustment
Divestitures
—
—
(12)
16
1
—
Non-GAAP pro forma adjusted revenue *
$1,776
$1,669
Mobility
Pro forma revenue *
Pro forma non-GAAP adjustments
Fiscal period alignment adjustment
$1,351
$1,209
—
—
26
11
Non-GAAP pro forma adjusted revenue *
$1,351
$1,246
Indices
Pro forma revenue *
Divestitures
Non-GAAP pro forma adjusted revenue *
$1,356
(1)
$1,355
$1,253
—
$1,253
10 S&P Global 2022 Annual Report
(unaudited)
Total SPGI
Pro forma revenue *
Pro forma non-GAAP adjustments
Divestitures
2022
2021 % Change
$11,864
—
(22)
$12,403
(21)
—
(4)%
Non-GAAP pro forma adjusted revenue *
$11,842
$12,382
(4)%
Non-GAAP Pro Forma Adjusted Net Income attributable to SPGI and Diluted EPS
(unaudited)
2022
2021
% Change
Pro forma *
$3,543
$10.53
$3,383
$9.51
5%
11%
Net Income
attributable
to SPGI
Diluted
EPS
Net Income
attributable
to SPGI
Diluted
EPS
Net Income
attributable to
SPGI
Diluted
EPS
Pro forma non-GAAP adjustments (a)
Pro forma deal-related amortization
Fiscal period alignment adjustment
Divestitures
(507)
740
—
(9)
(1.51)
2.20
—
(0.03)
796
73
(115)
—
2.24
0.21
(0.33)
—
Non-GAAP pro forma adjusted *
$3,765
$11.19
$4,137
$11.63
(9)%
(4)%
* - The twelve months ended December 31, 2022 and 2021 include pro forma and non-GAAP pro forma adjusted measures. For pro forma to Non-GAAP pro forma
adjusted reconciliations refer to Exhibit 99.2 of the current report on Form 8-K furnished on February 9, 2023.
Note - Totals presented may not sum due to rounding.
(a)
The twelve months ended December 31, 2022 include a gain on dispositions of $1.9 billion, IHS Markit merger costs of $619 million, employee severance charges
of $289 million, a S&P Foundation grant of $200 million, disposition related costs of $24 million, a gain on acquisition of $10 million, an asset impairment of
$9 million, lease impairments of $5 million, legal costs of $5 million and an asset write-off of $4 million and an acquisition-related benefit of $4 million. The
twelve months ended December 31, 2022 also include a loss on extinguishment of debt of $8 million and tax expense of $157 million associated with a gain on
dispositions. The twelve months ended December 31, 2022 also includes an adjustment related to the JV Partner’s portion of the gain on the disposition of the
L100 Index as part of the sale of LCD to Morningstar.
S&P Global 2022 Annual Report 11
14
48
49
50
51
52
53
94
95
99
Management’s Discussion and Analysis
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income
Consolidated Balance Sheets
Consolidated Statements of Cash Flows
Consolidated Statements of Equity
Notes to the Consolidated Financial Statements
Report of Management
Report of Independent Registered Public Accounting Firm
Shareholder Information
100
Board of Directors
101
Executive Committee
12 S&P Global 2022 Annual Report
2022
Financial
Performance
Management’s Discussion and Analysis of Financial
Condition and Results of Operations
The following Management’s Discussion and Analysis (“MD&A”)
provides a narrative of the results of operations and financial
condition of S&P Global Inc. (together with its consolidated
subsidiaries, “S&P Global,” the “Company,” “we,” “us” or “our”)
for the years ended December 31, 2022 and 2021, respectively.
The MD&A provides information on factors that we believe
are important in understanding our results of operations and
comparability and certain other factors that may affect our
future results. The MD&A should be read in conjunction with
the consolidated financial statements and accompanying notes
included in our Annual Report on Form 10-K for the year ended
December 31, 2022, which have been prepared in accordance
with accounting principles generally accepted in the U.S.
(“U.S. GAAP”).
The MD&A includes the following sections:
– Overview
– Results of Operations
– Liquidity and Capital Resources
– Reconciliation of Non-GAAP Financial Information
– Critical Accounting Estimates
– Recent Accounting Standards
Certain of the statements below are forward-looking statements
within the meaning of the Private Securities Litigation Reform
Act of 1995. In addition, any projections of future results of
operations and cash flows are subject to substantial uncertainty.
See Forward-Looking Statements on page 46 of this report.
Overview
We are a provider of credit ratings, benchmarks, analytics and
workflow solutions in the global capital, commodity, automotive
and engineering markets. The capital markets include asset
managers, investment banks, commercial banks, insurance
companies, exchanges, trading firms and issuers; the commodity
markets include producers, traders and intermediaries within
energy, petrochemicals, metals & steel and agriculture;
the automotive markets include manufacturers, suppliers,
dealerships and service shops; and the engineering markets
include engineers, builders, and architects.
During 2022, following the completion of our merger with IHS
Markit, we reorganized our reportable segments increasing from
four reportable segments to six reportable segments consisting
of: S&P Global Market Intelligence (“Market Intelligence”),
S&P Global Ratings (“Ratings”), S&P Global Commodity Insights
(“Commodity Insights”), S&P Global Mobility (“Mobility”), S&P
Dow Jones Indices (“Indices”) and S&P Global Engineering
Solutions (“Engineering Solutions”). The creation of the two
additional segments in 2022 did not materially impact prior
years’ reportable segments.
– Market Intelligence is a global provider of multi-asset-
class data and analytics integrated with purpose-built
workflow solutions.
– Ratings is an independent provider of credit ratings,
research and analytics, offering investors and other market
participants information, ratings and benchmarks.
– Commodity Insights is a leading independent provider of
information and benchmark prices for the commodity and
energy markets.
– Mobility is a leading provider of solutions serving the full
automotive value chain including vehicle manufacturers
(OEMs), automotive suppliers, mobility service providers,
retailers, consumers, and finance and insurance companies.
– Indices is a global index provider maintaining a wide variety
of valuation and index benchmarks for investment advisors,
wealth managers and institutional investors.
– Engineering Solutions is a leading provider of engineering
standards and related technical knowledge.
On February 28, 2022, we completed the merger with IHS
Markit Ltd (“IHS Markit”) by acquiring 100% of the IHS Markit
common stock that was issued and outstanding as of the date
of acquisition, and as a result, IHS Markit and its subsidiaries
became wholly owned consolidated subsidiaries of S&P Global,
and the consolidated financial statements as of and for the
year ended December 31, 2022 include the financial results
of IHS Markit from the date of acquisition. The merger with
IHS Markit, a world leader in critical information, analytics,
and solutions for the major industries and markets that drive
economies, brings together two world-class organizations with
leading brands and capabilities across information services that
will be uniquely positioned to serve, facilitate and power the
markets of the future.
On January 14, 2023, we entered into a securities and asset
purchase agreement with Allium Buyer LLC, a Delaware limited
liability company controlled by funds affiliated with Kohlberg
Kravis Roberts & Co. L.P. (“KKR”) to sell our Engineering Solutions
business for $975 million in cash, subject to customary purchase
price adjustments. We currently anticipate the divestiture to
result in after-tax proceeds of approximately $750 million, which
proceeds are expected to be used for share repurchases. The
agreement follows our announced intent in November of 2022 to
divest the business. Engineering Solutions became part of the
Company following our merger with IHS Markit. The transaction,
which is subject to receipt of required regulatory approvals and
satisfying other customary closing conditions, is expected to
close by the end of the second quarter of 2023.
14 S&P Global 2022 Annual Report
Shareholder Return
During the three years ended December 31, 2022, we have
returned approximately $15.6 billion to our shareholders
through a combination of share repurchases and our quarterly
dividends: we completed share repurchases of approximately
$13.2 billion and distributed regular quarterly dividends totaling
approximately $2.4 billion. Also, on January 25, 2023, the Board
of Directors approved a quarterly common stock dividend of
$0.90 per share.
Key Results
(in millions)
Revenue
Operating profit 2
% Operating margin
Diluted earnings per share from net income
Year ended December 31,
% Change 1
2022
$11,181
$4,944
44%
$10.20
2021
$8,297
$4,221
51%
$12.51
2020
’22 vs ’21
21 vs ’20
$7,442
3,617
49%
$9.66
35%
17%
(18)%
11%
17%
29%
1 % changes in the tables throughout the MD&A are calculated off of the actual number, not the rounded number presented.
2
Operating profit for the year ended December 31, 2022 includes a gain on dispositions of $1.9 billion, IHS Markit merger costs of $619 million, employee severance
charges of $289 million, a S&P Foundation grant of $200 million, disposition-related costs of $24 million, a gain on acquisition of $10 million, an asset impairment
of $9 million, lease impairments of $5 million, legal costs of $5 million, an asset write-off of $4 million and an acquisition-related benefit of $4 million. 2021
includes IHS Markit merger costs of $249 million, employee severance charges of $19 million, gain on dispositions of $11 million, a lease impairment of $3 million,
Kensho retention related expense of $2 million, acquisition-related costs of $4 million and recovery of lease-related costs of $2 million. 2020 includes lease
impairments of $120 million, employee severance charges of $66 million, IHS Markit merger costs of $24 million, a gain on dispositions $16 million, a technology-
related impairment charge of $12 million, lease-related costs of $11 million and Kensho retention related expense of $11 million. 2022, 2021 and 2020 also
includes amortization of intangibles from acquisitions of $905 million, $96 million and $123 million, respectively.
2022
Revenue increased 35% primarily due to the impact of the
merger with IHS Markit; subscription revenue growth for certain
Desktop products, RatingsXpress®, RatingsDirect®, and certain
data feed products within Data & Advisory Solutions at Market
Intelligence; continued demand for market data and market
insights products and higher conference revenue at Commodity
Insights; higher exchange-traded derivative revenue, higher
average levels of assets under management for mutual funds
and higher data subscription revenue at Indices. These increases
were partially offset by a decrease in revenue at Ratings due
to lower corporate bond ratings revenue driven by a decrease
in high-yield and investment-grade issuance volumes, lower
bank loan ratings revenue and a decrease in structured finance
revenue. Foreign exchange rates had an unfavorable impact of 2
percentage points.
Operating profit increased 17%. Excluding the favorable
impact of a higher gain on dispositions of 57 percentage points,
partially offset by the impact of higher IHS Markit merger costs
in 2022 of 11 percentage points, a S&P Foundation grant in
2022 of 6 percentage points, higher amortization of intangibles
from acquisitions in 2022 of 26 percentage points and higher
employee severance charges in 2022 of 8 percentage points
and disposition-related costs of 1 percentage point, operating
profit increased 12%. The increase was primarily due to revenue
growth, lower incentive costs and lower occupancy costs from
reduced real estate footprint, partially offset by expenses
associated with the merger with IHS Markit, an increase in
compensation costs driven by additional headcount and annual
merit and promotion increases, the resumption of business
travel from the lifting of COVID restrictions, higher outside
services expenses and an increase in technology expenses.
Foreign exchange rates had an unfavorable impact of less than 1
percentage point.
2021
Revenue increased 11% with an unfavorable impact of 1
percentage point from the net impact of recent acquisitions
and dispositions, driven by increases at all of our reportable
segments. Revenue growth at Ratings was driven by an increase
in both transaction revenue and non-transaction revenue.
Transaction revenue increased due to higher bank loan ratings
revenue and structured finance revenue. Non-transaction
revenue increased primarily due to an increase in surveillance,
entity credit ratings, an increase in revenue at our CRISIL
subsidiary and higher Ratings Evaluation Service (“RES”)
revenue. Revenue growth at Market Intelligence was driven by
subscription revenue growth in Market Intelligence Desktop
products, Credit Risk Solutions and Data Management Solutions.
Revenue growth at Indices was due to higher average levels of
assets under management for exchange traded funds (“ETFs”)
and mutual funds and higher data subscription revenue, partially
offset by lower exchange-traded derivative revenue. The revenue
increase at Platts was primarily due to continued demand for
market data and market insights products. Foreign exchange
rates had a favorable impact of less than 1 percentage point.
Operating profit increased 17%, with a favorable impact from
foreign exchange rates of 1 percentage point. Excluding the
unfavorable impact of IHS Markit merger costs in 2021 of 31
percentage points, partially offset by higher lease impairment
charges in 2020 of 16 percentage points, higher employee
severance charges in 2020 of 7 percentage points, higher
S&P Global 2022 Annual Report 15
amortization of intangibles from acquisitions in 2020 of 4
percentage points and higher technology-related impairment
charges in 2020 of 2 percentage points, operating profit
increased 15%. The increase was primarily due to revenue
growth at all of our reportable segments combined with a
decrease in occupancy costs, partially offset by higher incentive
costs and an increase in compensation costs driven by additional
headcount and annual merit increases.
Our Strategy
We are a provider of credit ratings, benchmarks, analytics and
workflow solutions in the global capital, commodity, automotive
and engineering markets. Our purpose is to accelerate progress.
We seek to deliver on this purpose in line with our core values of
discovery, partnership and integrity.
In 2018, we announced the launch of Powering the Markets
of the Future to provide a framework for our forward-looking
business strategy. Through this framework, we seek to deliver an
exceptional, differentiated customer experience by enhancing
our foundational capabilities, evolving and growing our core
businesses, and pursuing growth via adjacencies. In 2023,
we are striving to deliver on our strategic priorities in the
following key areas:
Data and Technology
– Efficient integration, accessibility and governance of
enterprise data assets, with initial focus on sustainability
data, data science and enterprise-wide data management
through the formation of a data council to drive enterprise
value creation;
– Advancing transition to optimize tech spend practice
i.e., shifting the balance towards funding higher growth
innovation, establishing key spend benchmarks and 3-year
transition plan; and
– Continuing momentum in transitioning all products and
services to a cloud-based ecosystem while implementing
technologies that align to our customer needs and unlock
new opportunities.
Lead and Inspire
– Continuing to improve diverse representation through
hiring, advancement and retention, while continuing
to raise awareness through Diversity, Equity, and
Inclusion education; and
– Ensuring our people are engaged with a particular focus on
learning, development and career opportunities, and continue
to embed our purpose and values throughout the Company.
Finance
– Meeting or exceeding our organic revenue growth and EBITA
margin targets;
– Realizing our merger/integration commitments - cost and
Execute and Deliver
– Driving continuous commitment to risk management,
compliance, and control across S&P Global; and
revenue synergy targets; and
– Creating a more sustainable impact.
There can be no assurance that we will achieve success in
implementing any one or more of these strategies as a variety
of factors could unfavorably impact operating results, including
prolonged difficulties in the global credit markets and a change
in the regulatory environment affecting our businesses. See Item
1A, Risk Factors in our Annual Report on Form 10-K.
Further projections and discussion on our 2023 outlook for our
segments can be found within “ – Results of Operations”.
– Driving growth and superior shareholder returns through
effective execution, active portfolio management and prudent
capital allocation.
Customer at the Core
– Enhancing customer support and seamless user experience
with a focus on ease of discoverability, distribution, and
delivery of our products and services and integrated
capabilities; and
– Continuing to invest in customer facing
solutions and processes.
Grow and Innovate
– Continuing to fund and accelerate key growth areas and
transformational adjacencies;
– Exercising disciplined organic capital allocation, inorganic
and partnership strategies; and
– Growing the value of S&P Global’s brand through an
integrated marketing and communication strategy; driving
awareness and consideration across the product offering
16 S&P Global 2022 Annual Report
Results of Operations
CONSOLIDATED REVIEW
Year ended December 31,
% Change
(in millions)
Revenue
Expenses:
Operating-related expenses
Selling and general expenses
Depreciation and amortization
Total expenses
Gain on dispositions
Equity in Income on Unconsolidated
Subsidiaries
Operating profit
Other income, net
Interest expense, net
Loss on extinguishment of debt
Provision for taxes on income
Net income
Less: net income attributable to
noncontrolling interests
2022
$11,181
2021
$8,297
2020
$7,442
3,766
3,383
1,013
8,162
(1,898)
(27)
4,944
(70)
304
8
1,180
3,522
(274)
2,195
1,714
178
4,087
(11)
—
4,221
(62)
119
—
901
3,263
(239)
2,094
1,541
206
3,841
(16)
—
3,617
(31)
141
279
694
2,534
(195)
Net income attributable to S&P Global Inc.
$3,248
$3,024
$2,339
’22 vs ’21
’21 vs ’20
35%
72%
97%
N/M
N/M
N/M
N/M
17%
(14)%
N/M
N/M
31%
8%
(15)%
7%
11%
5%
11%
(13)%
6%
(30)%
N/M
17%
(96)%
(16)%
N/M
30%
29%
(22)%
29%
Revenue
(in millions)
Revenue
Subscription revenue
Non-subscription / transaction revenue
Non-transaction revenue
Asset-linked fees
Sales usage-based royalties
Recurring variable
% of total revenue:
Subscription revenue
Non-subscription / transaction revenue
Non-transaction revenue
Asset-linked fees
Sales usage-based royalties
Recurring variable
U.S. revenue
International revenue:
European region
Asia
Rest of the world
Total international revenue
% of total revenue:
U.S. revenue
International revenue
Year ended December 31,
% Change
2022
$11,181
6,201
1,807
1,640
862
286
385
55%
16%
15%
8%
3%
3%
2021
$8,297
3,255
2,320
1,698
800
224
—
39%
28%
20%
10%
3%
—
2020
$7,442
3,037
2,030
1,500
648
227
—
41%
27%
20%
9%
3%
—
$6,653
$5,012
$4,504
2,597
1,246
685
$4,528
60%
40%
1,995
874
416
$3,285
60%
40%
1,769
782
387
$2,938
61%
39%
’22 vs ’21
’21 vs ’20
35%
90%
(22)%
(3)%
8%
28%
N/M
33%
30%
43%
65%
38%
11%
7%
14%
13%
23%
(1)%
N/M
11%
13%
12%
7%
12%
N/M- Represents a change equal to or in excess of 100% or not meaningful
S&P Global 2022 Annual Report 17
2022 Revenue by Type
2022 Revenue by Geographic Area
Non-subscription /
Transaction
16%
Non-transaction
15%
Subscription
55%
Asset-linked fees
8%
Sales usage-based
royalties
3%
Recurring variable
3%
Rest of the
World
6%
Asia
11%
U.S.
60%
European Region
23%
2021
Revenue increased 11% as compared to 2020. Subscription
revenue increased primarily from growth in Market Intelligence’s
average contract values and continued demand for Commodity
Insights market data and market insights products. Higher data
subscription revenue at Indices also contributed to subscription
revenue growth. Non-subscription / transaction revenue
increased due to an increase in bank loan ratings revenue and
higher structured finance revenue at Ratings. Non-transaction
revenue increased primarily due to an increase in surveillance,
entity credit ratings, an increase in revenue at our CRISIL
subsidiary and higher RES revenue at Ratings. Asset linked
fees increased reflecting higher average levels of assets under
management for ETFs and mutual funds at Indices. The decrease
in sales usage-based royalties was primarily driven by lower
exchange-traded derivative revenue at Indices. See “Segment
Review” below for further information.
The favorable impact of foreign exchange rates increased
revenue by less than 1 percentage point. This impact refers to
constant currency comparisons estimated by recalculating
current year results of foreign operations using the average
exchange rate from the prior year.
2022
Revenue increased 35% as compared to 2021. Subscription
revenue increased primarily due to the impact of the merger with
IHS Markit. Subscription revenue growth in Desktop products,
Credit & Risk Solutions and Data & Advisory Solutions at Market
Intelligence, continued demand for Commodity Insights market
data and market insights products and higher data subscription
revenue at Indices also contributed to the increase. Non-
subscription / transaction revenue decreased due to a decrease
in corporate bond ratings revenue, bank loan ratings revenue
and structured finance revenue at Ratings, partially offset by
the impact of the merger with IHS Markit and an increase in
conference revenue at Commodity Insights. Non-transaction
revenue decreased primarily due to the unfavorable impact
of foreign exchange rates, a decrease in entity credit ratings
revenue and lower RES revenue, partially offset by an increase in
revenue at our CRISIL subsidiary and an increase in surveillance
revenue at Ratings. Asset linked fees increased primarily due to
higher average levels of assets under management for mutual
funds at Indices. The increase in sales-usage based royalties was
primarily driven by higher exchange-traded derivative revenue
at Indices. Recurring variable revenue at Market Intelligence
represents revenue from contracts for services that specify a fee
based on, among other factors, the number of trades processed,
assets under management, or the number of positions valued.
See “Segment Review” below for further information.
The unfavorable impact of foreign exchange rates reduced
revenue by 2 percentage points. This impact refers to constant
currency comparisons estimated by recalculating current year
results of foreign operations using the average exchange rate
from the prior year.
18 S&P Global 2022 Annual Report
Total Expenses
The following tables provide an analysis by segment of our operating-related expenses and selling and general expenses for the
years ended December 31, 2022 and 2021:
(in millions)
2022
2021
% Change
Market Intelligence 1
Ratings 2
Commodity Insights 3
Mobility 4
Indices 5
Engineering Solutions 6
Intersegment eliminations 7
Total segments
Corporate Unallocated expense 8
Operating-
related
expenses
Selling and
general
expenses
Operating-
related
expenses
Selling and
general
expenses
Operating-
related
expenses
Selling and
general
expenses
$1,677
$983
$922
$499
940
513
296
207
197
(169)
3,661
105
392
466
385
218
76
—
2,520
863
995
214
—
173
—
(146)
2,158
37
$3,766
$3,383
$2,195
433
242
—
168
—
—
1,342
372
$1,714
82%
(5)%
N/M
N/M
20%
N/M
(16)%
70%
N/M
72%
97%
(9)%
93%
N/M
30%
N/M
N/M
88%
N/M
97%
N/M - Represents a change equal to or in excess of 100% or not meaningful
1
2
3
4
In 2022, selling and general expenses include employee severance charges of $90 million, IHS Markit merger costs of $35 million and acquisition-related costs
of $2 million. In 2021, selling and general expenses include employee severance charges of $3 million, acquisition-related costs of $2 million and lease-related
costs of $1 million.
In 2022, selling and general expenses include employee severance charges of $24 million, legal costs of $5 million and an asset write-off of $1 million. In 2021,
selling and general expenses include employee severance charges of $3 million and recovery of lease-related costs of $4 million.
In 2022, selling and general expenses include employee severance charges of $45 million and IHS Markit merger costs of $26 million. In 2021, selling and general
expenses include recovery of lease-related costs of $2 million.
In 2022, selling and general expenses include acquisition-related benefit of $14 million, employee severance charges of $4 million and IHS Markit merger
costs of $3 million.
5
In 2022, selling and general expenses include employee severance charges of $14 million and IHS Markit merger costs of $2 million. In 2021, selling and general
expenses include recovery of lease-related costs of $1 million.
6
In 2022, selling and general expenses include employee severance charges of $4 million.
7
Intersegment eliminations primarily relate to a royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.
8
In 2022, selling and general expenses include IHS Markit merger costs of $553 million, a S&P Foundation grant of $200 million, employee severance charges
of $107 million, an asset impairment of $9 million, a gain on acquisition of $10 million, acquisition-related costs of $8 million, disposition-related costs of $24
million, lease impairments of $5 million and an asset write-off of $3 million. In 2021, selling and general expenses include IHS Markit merger costs of $249 million,
employee severance charges of $13 million, lease-related costs of $4 million, a lease impairment of $3 million, Kensho retention related expenses of $2 million
and acquisition-related costs of $2 million.
Operating-Related Expenses
Operating-related expenses increased 72% as compared to
2021, primarily driven by expenses associated with the merger
with IHS Markit and higher compensation costs, partially offset
by lower incentive costs.
points and higher employee severance charges of 13 percentage
points, selling and general expenses increased 56%. The
increase was primarily driven by expenses associated with the
merger with IHS Markit and higher compensation costs, partially
offset by lower incentive costs.
Intersegment eliminations primarily relate to a royalty charged
to Market Intelligence for the rights to use and distribute content
and data developed by Ratings.
Selling and General Expenses
Selling and general expenses increased 97%. Excluding the
unfavorable impact of higher IHS Markit merger costs in 2022 of
18 percentage points, a S&P Foundation grant of 10 percentage
Depreciation and Amortization
Depreciation and amortization was $1,013 million in 2022
compared to $178 million in 2021, primarily due to higher
intangible asset amortization driven by the impact of the merger
with IHS Markit.
S&P Global 2022 Annual Report 19
The following tables provide an analysis by segment of our operating-related expenses and selling and general expenses for the years
ended December 31, 2021 and 2020:
(in millions)
2021
2020
% Change
Market Intelligence 1
Ratings 2
Commodity Insights 3
Indices 4
Intersegment eliminations 5
Total segments
Corporate Unallocated expense 6
Operating-
related
expenses
Selling and
general
expenses
Operating-
related
expenses
Selling and
general
expenses
Operating-
related
expenses
Selling and
general
expenses
$922
995
214
173
(146)
2,158
37
$2,195
$499
433
242
168
—
1,342
372
$1,714
$905
950
196
146
(137)
2,060
34
$483
393
247
168
—
1,291
250
$2,094
$1,541
2%
5%
9%
18%
(6)%
5%
7%
5%
3%
10%
(2)%
—%
N/M
4%
49%
11%
N/M - Represents a change equal to or in excess of 100% or not meaningful
1
2
3
4
In 2021, selling and general expenses include employee severance charges of $3 million, acquisition-related costs of $2 million and lease-related costs of $1
million. In 2020, selling and general expenses include employee severance charges of $27 million and lease-related costs of $3 million.
In 2021, selling and general expenses include employee severance charges of $3 million and recovery of lease-related costs of $4 million. In 2020, selling and
general expenses include a technology-related impairment charge of $11 million, lease-related costs of $5 million and employee severance charges of $4 million.
In 2021, selling and general expenses include recovery of lease-related costs of $2 million. In 2020, selling and general expenses include employee severance
charges of $11 million and lease-related costs of $2 million.
In 2021, selling and general expenses include recovery of lease-related costs of $1 million. In 2020, selling and general expenses include employee severance
charges of $5 million, a lease impairment charge of $4 million, a technology-related impairment charge of $2 million and lease-related costs of $1 million.
5
Intersegment eliminations primarily relate to a royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.
6
In 2021, selling and general expenses include IHS Markit merger costs of $249 million, employee severance charges of $13 million, lease-related costs of $4
million, a lease impairment of $3 million, Kensho retention related expenses of $2 million and acquisition-related costs of $2 million. In 2020, selling and general
expenses include lease impairments of $116 million, IHS Markit merger costs of $24 million, employee severance charges of $19 million, Kensho retention related
expense of $12 million and a gain related to an acquisition of $1 million.
Operating-Related Expenses
Operating-related expenses increased by 5% as compared to
2020. Increases at Ratings, Indices and Commodity Insights
were primarily driven by higher incentive costs and an increase
in compensation costs due to additional headcount and annual
merit increases. The increase at Market Intelligence was
primarily due to an increase in intersegment royalties tied to
annualized contract value growth and higher incentive costs.
Intersegment eliminations primarily relate to a royalty charged
to Market Intelligence for the rights to use and distribute content
and data developed by Ratings.
Selling and General Expenses
Selling and general expenses increased 11%. Excluding the
unfavorable impact of IHS Markit merger costs in 2021 of 2
percentage points, offset by higher lease impairments in 2020
of 1 percentage point, higher employee severance charges in
2020 of less than 1 percentage point and higher lease-related
costs in 2020 of less than 1 percentage point, selling and general
expenses increased 11%. Increases at Ratings, Commodity
Insights and Indices were primarily driven by higher incentive
costs and an increase in compensation costs due to additional
headcount and annual merit increases. The increase at Market
Intelligence was primarily due to an increase in technology costs
and higher incentive costs, partially offset by a decrease in
compensation costs due to reduced headcount. These increases
were partially offset by lower occupancy costs and a decrease in
legal related costs at Indices.
Depreciation and Amortization
Depreciation and amortization decreased $28 million, or 13%,
compared to 2020 primarily due to a decrease in intangible
asset amortization related to assets that became fully
amortized, partially offset by an increase in amortization
expense driven by the acquisitions of RobecoSAM and
Greenwich Associates LLC in January 2020 and February
2020, respectively.
20 S&P Global 2022 Annual Report
(in millions)
Market Intelligence 1
Commodity Insights 3
Ratings 2
Indices 4
Intersegment eliminations 5
Total segments
Corporate Unallocated expense 6
Operating-
Selling and
Operating-
Selling and
Operating-
Selling and
related
expenses
general
expenses
related
expenses
general
expenses
related
expenses
general
expenses
$922
995
214
173
(146)
2,158
37
$2,195
$499
433
242
168
—
1,342
372
$1,714
$905
950
196
146
(137)
2,060
34
$483
393
247
168
—
1,291
250
$2,094
$1,541
2%
5%
9%
18%
(6)%
5%
7%
5%
3%
10%
(2)%
—%
N/M
4%
49%
11%
Gain on Dispositions
During the year ended December 31, 2022, we completed
the following dispositions that resulted in a pre-tax gain of
$1.9 billion, which was included in Gain on dispositions in the
consolidated statement of income:
– In June of 2022, we completed the previously announced
sale of Leveraged Commentary and Data (“LCD”) along
with a related family of leveraged loan indices, within our
Market Intelligence and Indices segments, respectively, to
Morningstar for a purchase price of $600 million in cash,
subject to customary adjustments, and a contingent payment
of up to $50 million which is payable six months following the
closing upon the achievement of certain conditions related to
the transition of LCD customer relationships. The contingent
payment is expected to be received in the first quarter of
2023. During the year ended December 31, 2022, we recorded
a pre-tax gain of $505 million ($378 million after tax) for the
sale of LCD. During the year ended December 31, 2022, we
recorded a pre-tax gain of $52 million ($43 million after-tax)
for the sale of a family of leveraged loan indices in Gain on
dispositions in the consolidated statements of income.
– In June of 2022, we completed the previously announced sale
of the Base Chemicals business to News Corp for $295 million
in cash. We did not recognize a gain on the sale of the Base
Chemicals business.
– In March of 2022, we completed the previously announced
sale of CUSIP Global Services (“CGS”), a business within our
Market Intelligence segment, to FactSet Research Systems
Inc. for a purchase price of $1.925 billion in cash, subject to
customary adjustments. During the year ended December
31, 2022, we recorded a pre-tax gain of $1.342 billion ($1.005
billion after tax) in Gain on dispositions in the consolidated
statements of income related to the sale of CGS.
– In February of 2022, we completed the previously announced
sale of OPIS to News Corp for $1.150 billion in cash. We did
not recognize a gain on the sale of OPIS.
During the year ended December 31, 2021, we completed the
following dispositions that resulted in a pre-tax gain of $11
million, which was included in Gain on dispositions in the
consolidated statements of income:
– During the year ended December 31, 2021, we recorded
a pre-tax gain of $8 million ($6 million after-tax) in Gain
on dispositions in the consolidated statements of income
related to the sale of office facilities in India.
– During the year ended December 31, 2021, we recorded a
pre-tax gain of $3 million ($3 million after-tax) in Gain on
dispositions in the consolidated statements of income related
to the sale of Standard & Poor’s Investment Advisory Services
LLC (“SPIAS”), a business within our Market Intelligence
segment, that occurred in July of 2019.
During the year ended December 31, 2020, we completed the
following dispositions that resulted in a pre-tax gain of $16
million, which was included in Gain on dispositions in the
consolidated statements of income:
– In January of 2020, Market Intelligence entered into
a strategic alliance to transition S&P Global Market
Intelligence’s Investor Relations (“IR”) webhosting business
to Q4 Inc. (“Q4”). This alliance integrated Market Intelligence’s
proprietary data into Q4’s portfolio of solutions, enabling
further opportunities for commercial collaboration. In
connection with transitioning its IR webhosting business to
Q4, Market Intelligence received a minority investment in Q4.
During the year ended December 31, 2020, we recorded a pre-
tax gain of $11 million ($6 million after-tax), respectively, in
Gain on dispositions in the consolidated statement of income
related to the sale of IR.
– In September of 2020, we sold our facility at East Windsor,
New Jersey. During the year ended December 31, 2020, we
recorded a pre-tax gain of $4 million ($3 million after-tax)
in Gain on dispositions in the consolidated statements of
income related to the sale of East Windsor.
– During the year ended December 31, 2020, we recorded
a pre-tax gain of $1 million ($1 million after-tax) in Gain
on dispositions in the consolidated statements of income
related to the sale of SPIAS, a business within our Market
Intelligence segment, in July of 2019.
Operating Profit
We consider operating profit to be an important measure
for evaluating our operating performance and we evaluate
operating profit for each of the reportable business segments in
which we operate.
We internally manage our operations by reference to operating
profit with economic resources allocated primarily based on each
segment’s contribution to operating profit. Segment operating
profit is defined as operating profit before Corporate Unallocated
expense and Equity in Income on Unconsolidated Subsidiaries.
Segment operating profit is not, however, a measure of financial
performance under U.S. GAAP, and may not be defined and
calculated by other companies in the same manner.
S&P Global 2022 Annual Report 21
The table below reconciles segment operating profit to total operating profit:
(in millions)
Market Intelligence 1
Ratings 2
Commodity Insights 3
Mobility 4
Indices 5
Engineering Solutions 6
Total segment operating profit
Corporate Unallocated expense 7
Equity in Income on Unconsolidated Subsidiaries 8
Total operating profit
Year ended December 31,
% Change
2022
$2,488
1,672
591
213
927
15
5,906
(989)
27
$4,944
2021
$676
2,629
544
—
798
—
4,647
(426)
—
2020
$569
2,223
478
—
666
—
3,936
(319)
—
$4,221
$3,617
’22 vs ’21
’21 vs ’20
N/M
(36)%
9%
N/M
16%
N/M
27%
N/M
N/M
17%
19%
18%
14%
N/M
20%
N/M
18%
(33)%
N/M
17%
N/M - Represents a change equal to or in excess of 100% or not meaningful
1
2
3
4
5
2022 includes a gain on disposition of $1.8 billion, employee severance charges of $90 million, IHS Markit merger costs of $35 million and acquisition-related
costs of $2 million. 2021 includes acquisition-related costs of $2 million. 2021 and 2020 include employee severance charges of $3 million and $27 million,
respectively, a gain on dispositions of $3 million and $12 million, respectively, and lease-related costs of $1 million and $3 million, respectively. 2022, 2021, and
2020 includes amortization of intangibles from acquisitions of $474 million, $65 million and $76 million, respectively.
2022 includes employee severance charges of $24 million, legal costs of $5 million and an asset write-off of $1 million. 2021 includes a gain on disposition of
$6 million, employee severance charges of $3 million and recovery of lease-related costs of $4 million. 2020 includes a technology-related impairment charge
of $11 million, lease-related costs of $5 million and employee severance charges of $4 million. 2022, 2021, and 2020, include amortization of intangibles from
acquisitions of $7 million, $10 million and $7 million, respectively.
2022 includes employee severance charges of $45 million and IHS Markit merger costs of $26 million. 2021 includes recovery of lease-related costs of $2 million.
2020 includes employee severance charges of $11 million and lease-related costs of $2 million. 2022, 2021 and 2020 includes amortization of intangibles from
acquisitions of $111 million, $8 million, and $9 million.
2022 includes an acquisition-related benefit of $14 million, employee severance charges of $4 million, IHS Markit merger costs of $3 million and amortization of
intangibles from acquisitions of $241 million.
2022 includes a gain on disposition of $52 million, employee severance charges of $14 million and IHS Markit merger costs of $2 million. 2021 includes recovery
of lease-related costs of $1 million. 2020 includes employee severance charges of $5 million, a lease impairment charge of $4 million, a technology-related
impairment charge of $2 million and lease-related costs of $1 million. 2022, 2021 and 2020 includes amortization of intangibles from acquisitions of $31 million,
$6 million and $6 million, respectively.
6
2022 includes employee severance charges of 4 million and amortization of intangibles from acquisitions of $35 million.
7
2022 includes IHS Markit merger costs of $553 million, a S&P Foundation grant of $200 million, employee severance charges of $107 million, a gain on acquisition
of $10 million, an asset impairment of $9 million, acquisition-related costs of $8 million, disposition-related costs of $24 million, lease impairments of $5
million and an asset write-off of $3 million. 2021 and 2020 includes IHS Markit merger costs of $249 million and $24 million, respectively. 2021 and 2020 include
employee severance charges of $13 million and $19 million, respectively, lease impairments of $3 million and $116 million, respectively, and Kensho retention
related expenses of $2 million, and $12 million, respectively. 2021 includes lease-related costs of $4 million, acquisition-related costs of $2 million and a gain on
disposition of $2 million. 2020 includes a gain related to an acquisition of $1 million. Additionally, 2022, 2021 and 2020 include amortization of intangibles from
acquisitions of $4 million, $7 million, and $26 million.
8
2022 includes amortization of intangibles from acquisitions of $55 million.
2022
Segment Operating Profit
Increased 27% as compared to 2021. Excluding the favorable
impact of a higher gain on dispositions in 2022 of 41 percentage
points, partially offset by higher amortization of intangibles from
acquisitions in 2022 of 18 percentage points, higher employee
severance charges in 2022 of 4 percentage points and IHS Markit
merger related costs in 2022 of 1 percentage point, segment
operating profit increased 9%. The increase was primarily due
to revenue growth primarily due to the impact of the merger with
IHS Markit, lower incentive costs and lower occupancy costs
from reduced real estate footprint, partially offset by a decrease
in revenue at Ratings, expenses associated with the merger
with IHS Markit, an increase in compensation costs driven by
additional headcount and annual merit and promotion increases,
the resumption of business travel from the lifting of COVID
restrictions and an increase in technology expenses. See
“Segment Review” below for further information.
Corporate Unallocated Expense
Corporate Unallocated expense includes costs for corporate
functions, select initiatives, unoccupied office space and Kensho,
included in selling and general expenses. Corporate Unallocated
expense increased 132% compared to 2021. Excluding higher
IHS Markit merger costs in 2022 of 85 percentage points, a
S&P Foundation grant in 2022 of 56 percentage points, higher
employee severance charges in 2022 of 26 percentage points,
disposition-related costs in 2022 of 7 percentage points, an
22 S&P Global 2022 Annual Report
asset impairment in 2022 of 2 percentage points and higher
acquisition-related costs in 2022 of 1 percentage point, partially
offset by a gain on acquisition in 2022 of 3 percentage points and
lower amortization of intangibles from acquisitions in 2022 of
1 percentage point, Corporate Unallocated expense decreased
41% primarily due to cost synergies and lower incentive costs
Equity in Income on Unconsolidated Subsidiaries
The Company holds an investment in a 50/50 joint venture
arrangement with shared control with CME Group that combined
each of the company’s post-trade services into a new joint
venture, OSTTRA. The joint venture provides trade processing
and risk mitigation operations and incorporates CME Group’s
optimization businesses (Traiana, TriOptima, and Reset) and the
Company’s MarkitSERV business. The combination is intended to
increase operating efficiencies of both the company’s business
to more effectively service clients with enhanced platforms
and services for OTC markets across interest rate, FX, equity,
and credit asset classes. Equity in Income on Unconsolidated
Subsidiaries includes the OSTTRA joint venture acquired in
connection with the merger with IHS Markit. Equity in Income on
Unconsolidated Subsidiaries was $27 million for the year ended
December 31, 2022.
Foreign exchange rates had an unfavorable impact on operating
profit of less than 1 percentage point. This impact refers to
constant currency comparisons and the remeasurement of
monetary assets and liabilities. Constant currency impacts
are estimated by re-calculating current year results of foreign
operations using the average exchange rate from the prior year.
Remeasurement impacts are based on the variance between
current-year and prior-year foreign exchange rate fluctuations
on assets and liabilities denominated in currencies other than
the individual businesses functional currency.
2021
Segment Operating Profit
Increased $711 million or 18% as compared to 2020. Excluding
the impact of higher employee severance charges in 2020
of 2 percentage points and higher lease-related costs of 1
percentage point in 2020, segment operating profit increased
15%. The increase was primarily due to an increase in revenue
at all of our reportable segments combined with a decrease in
occupancy costs, partially offset by higher incentive costs and an
increase in compensation costs driven by additional headcount
and annual merit increases. See “Segment Review” below for
further information.
Corporate Unallocated Expense
Corporate Unallocated expense includes costs for corporate
functions, select initiatives, unoccupied office space and
Kensho, included in selling and general expenses. Corporate
Unallocated expense increased 33% compared to 2020.
Excluding the unfavorable impact of IHS Markit merger costs
in 2021 of 45 percentage points, higher lease-related costs
in 2021 of 1 percentage point and higher acquisition-related
costs in 2021 of 1 percentage point, partially offset by higher
lease impairments in 2020 of 23 percentage points, higher
amortization of intangibles in 2020 of 4 percentage points, higher
Kensho retention related expense in 2020 of 2 percentage points
and higher employee severance charges in 2020 of 1 percentage
point, Corporate Unallocated expense increased 16% primarily
due to higher incentive costs.
Foreign exchange rates had a favorable impact on operating
profit of 1 percentage point. This impact refers to constant
currency comparisons and the remeasurement of monetary
assets and liabilities. Constant currency impacts are estimated
by re-calculating current year results of foreign operations using
the average exchange rate from the prior year. Remeasurement
impacts are based on the variance between current-year and
prior-year foreign exchange rate fluctuations on assets and
liabilities denominated in currencies other than the individual
businesses functional currency.
Other Income, net
Other income, net primarily includes the net periodic benefit cost
for our retirement and post retirement plans. Other income, net
for 2022, 2021 and 2020 was $70 million, $62 million, $31 million
respectively. During 2022 and 2020, lump sum withdrawals
exceeded the combined total anticipated annual service and
interest cost of our U.K. pension plan, triggering the recognition
of a non-cash pre-tax settlement charges of $13 million and $3
million, respectively. Excluding these pre-tax settlement charges,
other income, net was $83 million, $62 million, and $34 million
for 2022, 2021, 2020, respectively. The increase in other income,
net in 2022 compared to 2021 and in 2021 compared to 2020
was primarily due to a higher gain on investments.
Interest Expense, net
Net interest expense for 2022 increased $185 million compared
to 2021 primarily due to higher debt balances. Net interest
expense for 2021 decreased $22 million or 16% compared to
2020, primarily due to lower interest expense resulting from the
refinancing of a series of our senior notes in August of 2020. See
Note 4 - Debt to the consolidated financial statements under
Item 8, Consolidated Financial Statements and Supplementary
Data, in our Annual Report on Form 10-K for further discussion.
Loss on Extinguishment of Debt, net
In 2022, we recognized an $8 million loss on extinguishment of
debt which includes a tender premium paid to tendering note
holders in accordance with the terms of the tender offer of $142
million, partially offset by a $134 million non-cash write-off
related to the fair market value step up premium on extinguished
debt. 2020 includes $279 million related to the redemption fee
on the early retirement of our 4.4% senior notes due in 2026 and
a portion of the 6.55% senior notes due in 2037 and 4.5% senior
notes due in 2048 in the third quarter of 2020.
Provision for Income Taxes
Our effective tax rate was 25.1%, 21.6% and 21.5% for 2022,
2021 and 2020, respectively. The increase in 2022 was primarily
due to the tax charge on merger related divestitures. The
increase in 2021 was primarily due to a change in the mix of
income by jurisdiction.
S&P Global 2022 Annual Report 23
Segment Review
MARKET INTELLIGENCE
Market Intelligence is a global provider of multi-asset-class data
and analytics integrated with purpose-built workflow solutions.
Market Intelligence’s portfolio of capabilities are designed to
help trading and investment professionals, government agencies,
corporations and universities track performance, generate alpha,
identify investment ideas, understand competitive and industry
dynamics, perform valuations and manage credit risk.
In June of 2022, we completed the previously announced sale of
Leveraged Commentary and Data (“LCD”), a business within our
Market Intelligence segment, to Morningstar. During the year
ended December 31, 2022, we recorded a pre-tax gain of $505
million ($378 million after-tax) in Gain on dispositions in the
consolidated statements of income for the sale of LCD.
In March of 2022, we completed the previously announced sale
of CUSIP Global Services (“CGS”), a business within our Market
Intelligence segment, to FactSet Research Systems Inc. for a
purchase price of $1.925 billion in cash, subject to customary
adjustments. During the year ended December 31, 2022, we
recorded a pre-tax gain of $1.342 billion ($1.005 billion after-tax)
in Gain on dispositions in the consolidated statements of income
related to the sale of CGS.
In January of 2020, Market Intelligence entered into a strategic
alliance to transition S&P Global Market Intelligence’s Investor
Relations (“IR”) webhosting business to Q4 Inc. (“Q4”), a third
party provider of investor relations related services. This
alliance integrated Market Intelligence’s proprietary data into
Q4’s portfolio of solutions, enabling further opportunities for
commercial collaboration. In connection with transitioning its
IR webhosting business to Q4, Market Intelligence received a
minority investment in Q4. During the year ended December 31,
2020, we recorded a pre-tax gain of $11 million ($6 million after-
tax) in Gain on dispositions in the consolidated statement of
income related to the sale of IR.
During the years ended December 31, 2021 and 2020, we
recorded a pre-tax gain of $3 million ($3 million after-tax) and $1
million ($1 million after-tax), respectively, in Gain on dispositions
in the consolidated statement of income related to the sale of
Standard & Poor’s Investment Advisory Services LLC (“SPIAS”), a
business within our Market Intelligence segment, that occurred
in July of 2019.
See Note 2 - Acquisitions and Divestitures to the consolidated
financial statements under Item 8, Consolidated Financial
Statements and Supplementary Data, in our Annual Report on
Form 10-K for further discussion including information on the
merger with IHS Markit.
Market Intelligence includes the following business lines:
– Desktop — a product suite that provides data, analytics
and third-party research for global finance and corporate
professionals, which includes the Capital IQ platforms (which
are inclusive of S&P Capital IQ Pro, Capital IQ, Office and
Mobile products);
– Data & Advisory Solutions — a broad range of research,
reference data, market data, derived analytics and valuation
services covering both the public and private capital markets,
delivered through flexible feed-based or API delivery
mechanisms. This also includes issuer solutions for public
companies, a range of products for the maritime & trade
market, data and insight into Financial Institutions, the
telecoms, technology and media space as well as ESG and
supply chain data analytics;
– Enterprise Solutions — software and workflow solutions
that help our customers manage and analyze data; identify
risk; reduce costs; and meet global regulatory requirements.
The portfolio includes industry leading financial technology
solutions like Wall Street Office, Enterprise Data Manager,
Information Mosaic, and iLevel. Our Global Markets
Group offering delivers bookbuilding platforms across
multiple assets including municipal bonds, equities and
fixed income; and
– Credit & Risk Solutions — commercial arm that sells Ratings’
credit ratings and related data and research, advanced
analytics, and financial risk solutions which includes
subscription-based offerings, RatingsXpress®, RatingsDirect®
and Credit Analytics.
Subscription revenue at Market Intelligence is primarily derived
from distribution of data, valuation services, analytics, third
party research, and credit ratings-related information through
both feed and web-based channels. Subscription revenue also
includes software and hosted product offerings which provide
maintenance and continuous access to our platforms over the
contract term. Recurring variable revenue at Market Intelligence
represents revenue from contracts for services that specify a fee
based on, among other factors, the number of trades processed,
assets under management, or the number of positions valued.
Non-subscription revenue at Market Intelligence is primarily
related to certain advisory, pricing conferences and events, and
analytical services.
24 S&P Global 2022 Annual Report
The following table provides revenue and segment operating profit information for the years ended December 31:
Year ended December 31,
% Change
(in millions)
Revenue
Subscription revenue
Recurring variable revenue
Non-subscription revenue
Asset-linked fees
% of total revenue:
Subscription revenue
Recurring variable revenue
Non-subscription revenue
Asset-linked fees
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
% Operating margin
2022
$3,811
$3,263
$385
$163
$—
86%
10%
4%
—%
$2,231
$1,580
59%
41%
$2,488
65%
2021
$2,185
$2,131
$—
$54
$—
98 %
— %
2 %
— %
$1,374
$811
63 %
37 %
$676
31%
2020
2,046
$1,991
$—
$54
$1
97%
—%
3%
—%
$1,316
$730
64%
36%
$569
28%
’22 vs ’21
’21 vs ’20
74%
53%
N/M
N/M
N/M
7%
7%
N/M
(2)%
(94)%
62%
95%
4%
11%
N/M
19%
N/M – Represents a change equal to or in excess of 100% or not meaningful
Note – In the first quarter of 2022, the Market Intelligence Commodities business was transferred to the Commodity Insights segment and prior-year amounts have
been reclassified to conform with current presentation.
1
2022 includes a gain on dispositions of $1.8 billion, employee severance charges of $90 million, IHS Markit merger costs of $35 million, and acquisition-related
costs of $2 million. 2021 includes employee severance charges of $3 million, a gain on disposition of $3 million, acquisition-related costs of $2 million and lease-
related costs of $1 million. 2020 includes employee severance charges of $27 million, a gain on dispositions of $12 million and lease-related costs of $3 million.
2022, 2021 and 2020 includes amortization of intangibles from acquisitions of $474 million, $65 million and $76 million, respectively.
S&P Global 2022 Annual Report 25
2022
Revenue increased 74% primarily due to the impact of the
merger with IHS Markit. Subscription revenue growth for
certain Market Intelligence Desktop products, RatingsXpress®,
RatingsDirect®, and certain data feed products within Data
and Advisory Solutions also contributed to revenue growth.
Foreign exchange rates had an unfavorable impact of 2
percentage points.
Operating profit increased 268%. Excluding the impact of a
gain on dispositions of 282 percentage points, partially offset
by higher amortization of intangibles of 63 percentage points,
employee severance charges in 2022 of 13 percentage points
and IHS Markit merger costs in 2022 of 5 percentage points,
operating profit increased 67% primarily due to revenue growth
and lower incentive costs, partially offset by expenses associated
with the merger with IHS Markit, an increase in technology
expenses and higher compensation costs. Foreign exchange
rates had a favorable impact of 4 percentage points.
2021
Revenue increased 7% driven by subscription revenue growth
for RatingsXpress®, RatingsDirect®, certain Market Intelligence
Desktop products, and certain data feed products within Data
and Advisory Solutions. Both U.S. revenue and international
revenue increased compared to 2021. Foreign exchange rates
had a favorable impact of less than 1 percentage point.
Operating profit increased 19%, with an unfavorable impact from
foreign exchange rates of less than 1 percentage point. Excluding
the impact from higher employee severance charges in 2020 of 6
percentage points and higher amortization of intangibles in 2020
of 3 percentage points, partially offset by the impact of a higher
gain on the dispositions in 2020 of 2 percentage points, operating
profit increased 12%. The impact of revenue growth and lower
compensation costs due to reduced headcount was partially
offset by an increase in cost of sales and intersegment royalties
tied to annualized contract value growth, increased technology
costs and higher incentive costs.
Industry Highlights and Outlook
Market Intelligence continues to focus on developing key
product offerings in growth areas such as Environmental,
Social and Governance (“ESG”) and growing new products and
product features by leveraging technology investments. Product
launches and innovation continued at Market Intelligence
in 2022 with the introduction of several new ESG related
products and new products and product features leveraging
technology investments.
Legal and Regulatory Environment
The market for data, analytical capabilities and research services
is intensely competitive, ranging from established firms to
market disruptors. Market Intelligence competes domestically
and internationally based on a number of factors, including the
quality and range of its data, analytical capabilities, research
services, client service, reputation, price, geographic scope, and
technological innovation.
Market Intelligence is subject to global regulation, particularly
in the European Union, the U.K. and the U.S. Several laws
and regulations in the European Union, the U.K. and the U.S.
have been adopted but not yet implemented, or have been
proposed or are being considered, to which Market Intelligence,
or its clients, will or may become subject, including laws and
regulations related to pricing providers, sustainability, credit
rating data, data privacy and cyber security. For example, the
EU passed the Digital Operational Resilience Act in December
2022 (“DORA”), which is expected to take effect by the end of
January 2025. DORA will impose operational resilience and
cyber security standards and obligations, including technical
and organizational standards and responsibilities which may
require technology and/or organizational investment, upon (i)
many Market Intelligence financial market clients, who may look
to pass such obligations onto vendors like Market Intelligence,
and (ii) information and communications technology providers
designated by the EU as “Critical Third Party Providers,” which
may, or may not, include Market Intelligence. In addition, the U.K.
Financial Conduct Authority has announced that it will conduct a
market study into how competition is working in the markets for
credit rating data and market data generally, which is expected to
commence at the start of 2023.
At this time, the impact on Market Intelligence of any such
recently adopted or proposed laws or regulations, or market
studies, remains uncertain, but they could increase the
regulatory exposure of Market Intelligence or the costs and
legal risks relating to Market Intelligence’s activities, adversely
affect the ability of Market Intelligence to provide its products
and services, or result in changes in the demand for its products
and services. If Market Intelligence fails to comply with any such
laws or regulations, it could be subject to significant litigation,
civil or criminal penalties, monetary damages, regulatory
enforcement actions or fines. Regulatory developments may
also present commercial opportunities to Market Intelligence to
develop further or different services to enable better compliance
by its clients.
For a further discussion of competitive and other risks inherent
in our Market Intelligence business, see Item 1A, Risk Factors,
in our Annual Report on Form 10-K. For a further discussion of
the legal and regulatory environment in our Market Intelligence
business, see Note 13 - Commitments and Contingencies to the
consolidated financial statements under Item 8, Consolidated
Financial Statements and Supplementary Data, in our Annual
Report on Form 10-K.
26 S&P Global 2022 Annual Report
RATINGS
Ratings is an independent provider of credit ratings, research,
and analytics, offering investors and other market participants
information, ratings and benchmarks. Credit ratings are one of
several tools investors can use when making decisions about
purchasing bonds and other fixed income investments. They
are opinions about credit risk and our ratings express our
opinion about the ability and willingness of an issuer, such as
a corporation or state or city government, to meet its financial
obligations in full and on time. Our credit ratings can also
relate to the credit quality of an individual debt issue, such as a
corporate or municipal bond, and the relative likelihood that the
issue may default.
Ratings disaggregates its revenue between transaction and
non-transaction. Transaction revenue primarily includes fees
associated with:
– ratings related to new issuance of corporate and government
debt instruments, as well as structured finance debt
instruments; and
– bank loan ratings.
Non-transaction revenue primarily includes fees for surveillance
of a credit rating, annual fees for customer relationship-based
pricing programs, fees for entity credit ratings and global
research and analytics at CRISIL. Non-transaction revenue also
includes an intersegment royalty charged to Market Intelligence
for the rights to use and distribute content and data developed
by Ratings. Royalty revenue for 2022, 2021 and 2020 was $143
million, $136 million and $128 million, respectively.
The following table provides revenue and segment operating profit information for the years ended December 31:
Year ended December 31,
% Change
(in millions)
Revenue
Transaction revenue
Non-transaction revenue
% of total revenue:
Transaction revenue
Non-transaction revenue
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
% Operating margin
2022
$3,050
$1,241
$1,809
41%
59%
$1,652
$1,398
54%
46%
$1,672
55%
2021
$4,097
$2,253
$1,844
55%
45%
$2,398
$1,699
59%
41%
$2,629
64%
2020
$3,606
$1,969
$1,637
55%
45%
$2,110
$1,496
59%
41%
$2,223
62%
’22 vs ’21
’21 vs ’20
(26)%
(45)%
(2)%
(31)%
(18)%
14%
14%
13%
14%
14%
(36)%
18%
1
2022 includes employee severance charges of $24 million, legal costs of $5 million and an asset write-off of $1 million. 2021 includes a gain on disposition of
$6 million, recovery of lease-related costs of $4 million, and employee severance charges of $3 million. 2020 includes a technology-related impairment charge
of $11 million, lease-related costs of $5 million and employee severance charges of $4 million. 2022, 2021 and 2020 include amortization of intangibles from
acquisitions of $7 million, $10 million and $7 million, respectively.
2022
Revenue decreased 26% with an unfavorable impact from foreign
exchange rates of 3 percentage points. Transaction revenue
decreased due to lower corporate bond ratings revenue driven by
a decrease in high-yield and investment-grade issuance volumes
and lower bank loan ratings revenue. A decrease in structured
finance revenues primarily driven by decreased issuance of U.S.
collateralized loan obligations (“CLOs”) also contributed to the
decrease in transaction revenue. Reduced issuance volumes
mainly resulted from unfavorable macroeconomic conditions
in 2022 compared to strong issuance levels in the prior year
period. Non-transaction revenue decreased 2% primarily due
to the unfavorable impact of foreign exchange rates, a decrease
in entity credit ratings revenue and lower Ratings Evaluation
Service (“RES”) revenue driven by decreased M&A activity,
partially offset by an increase in revenue at our CRISIL subsidiary
and an increase in surveillance revenue. Excluding the
unfavorable impact of foreign exchange rates of 3 percentage
points, non-transaction revenue increased 1%. Transaction and
non-transaction revenue also benefited from improved contract
terms across product categories.
Operating profit decreased 36%, with an unfavorable impact
from foreign exchange rates of 1 percentage point. Excluding the
impact of employee severance charges in 2022 of 1 percentage
point, operating profit decreased 35% primarily due to a decline
in revenue partially offset by decrease in expenses. The decrease
in expenses was driven by lower incentive costs due to weaker
financial performance, lower outside services expenses, lower
occupancy costs from reduced real estate footprint, partially
offset by higher compensation costs driven by targeted
investments into key areas of the business, and the resumption
of business travel from the lifting of COVID restrictions.
S&P Global 2022 Annual Report 27
2021
Revenue increased 14%, with a favorable impact from foreign
exchange rates of 1 percentage point. Transaction revenue
increased due to higher bank loan ratings revenue driven by
increased M&A activity and an increase in structured finance
revenue primarily driven by increased issuance of U.S. CLOs.
Non-transaction revenue increased primarily due to an increase
in surveillance, entity credit ratings, an increase in revenue
at our CRISIL subsidiary and higher RES revenue driven by
increased M&A activity. Transaction and non-transaction
revenue also benefited from improved contract terms across
product categories.
Operating profit increased 18%, with a favorable impact from
foreign exchange rates of 1 percentage point. The impact of
revenue growth and lower occupancy costs was partially offset
by an increase in incentive costs and higher compensation costs
due to annual merit increases, additional headcount and human
capital investments, as well as the ramp up of technology and
strategic initiatives.
– ABS issuance decreased in the U.S. and Europe
driven by a decline in Autos, Student Loans, and Non-
Traditional / Esoterics.
– CLO issuance was down in the U.S. and European structured
credit markets due to unfavorable market conditions and
widening spreads slowing down new issues and eliminating
refinancing and resets.
– CMBS issuance was down in the U.S. reflecting unfavorable
market conditions. CMBS issuance was also down in Europe,
although from a low 2021 base.
– RMBS issuance was down in the U.S. reflecting decreased
market volume due to unfavorable market conditions. RMBS
issuance increased in Europe reflecting an increase in
large jumbo deals.
– Covered bond (debt securities backed by mortgages or other
high-quality assets that remain on the issuer’s balance
sheet) issuance in Europe increased from a low 2021 base as
cheaper government programs slowed down.
Market Issuance Volumes
We monitor market issuance volumes regularly within Ratings.
Market issuance volumes noted within the discussion that
follows are based on where an issuer is located or where the
assets associated with an issue are located. Structured Finance
issuance includes amounts when a transaction closes, not
when initially priced, and excludes domestically-rated Chinese
issuance. The following tables depict changes in issuance
levels as compared to the prior year based on data from SDC
Platinum for Corporate bond issuance and based on a composite
of external data feeds and Ratings’ internal estimates for
Structured Finance issuance.
2022 Compared to 2021
Corporate Bond Issuance *
U.S.
Europe
Global
High-yield issuance
Investment-grade issuance
Total issuance**
(79)%
(20)%
(39)%
(70)%
(12)%
(28)%
(77)%
(18)%
(24)%
*
Includes Industrials and Financial Services.
**
Includes rated and non-rated issuance.
– Corporate issuance was down in the U.S. and Europe
reflecting unfavorable macroeconomic conditions in 2022
compared to strong issuance levels in 2021.
2022 Compared to 2021
Structured Finance
U.S.
Europe
Global
Asset-backed securities (“ABS”)
Structured credit (primarily
CLOs)
Commercial mortgage-backed
securities (“CMBS”)
Residential mortgage-backed
securities (“RMBS”)
Covered bonds
Total issuance
(11)%
(43)%
(13)%
(68)%
(70)%
(68)%
(5)%
(86)%
(11)%
(29)%
**
(38)%
25%
68%
(1)%
(21)%
72%
(23)%
** Represents no activity in 2022 or 2021.
28 S&P Global 2022 Annual Report
Industry Highlights and Outlook
Revenue decreased in 2022 primarily driven by declines in
corporate bond ratings revenue, bank loan ratings revenue,
structured finance transaction revenues, partially offset by an
increase in revenue at our CRISIL subsidiary. CRISIL revenue
increased across all segments, primarily driven by Global
Research & Risk Solutions. In 2022, Ratings continued to focus
on developing key product offerings in ESG and launched
new sustainability products. ESG initiatives and international
expansion in China continue to be areas of focus for Ratings.
Legal and Regulatory Environment
General
Ratings and many of the securities that it rates are subject to
extensive regulation in both the U.S. and in other countries, and
therefore existing and proposed laws and regulations can impact
the Company’s operations and the markets in which it operates.
Additional laws and regulations have been adopted but not yet
implemented or have been proposed or are being considered. In
addition, in certain countries, governments may provide financial
or other support to locally-based rating agencies. For example,
governments may from time to time establish official rating
agencies or credit ratings criteria or procedures for evaluating
local issuers. We have reviewed the new laws, regulations and
rules which have been adopted and we have implemented, or
are planning to implement, changes as required. We do not
believe that such new laws, regulations or rules will have a
material adverse effect on our financial condition or results
of operations. Other laws, regulations and rules relating to
credit rating agencies are being considered by local, national,
foreign and multinational bodies and are likely to continue to be
considered in the future, including provisions seeking to reduce
regulatory and investor reliance on credit ratings or to increase
competition among credit rating agencies, and regarding
remuneration and rotation of credit rating agencies, and liability
standards applicable to credit rating agencies. The impact on us
of the adoption of any such laws, regulations or rules remains
Markets Authority (“ESMA”), which, among other things, has
direct supervisory responsibility for the registered credit rating
industry throughout the EU.
Additional rules augmenting the supervisory framework for
credit rating agencies went into effect in 2013. Commonly
referred to as CRA3, these rules, among other things:
– impose various additional procedural requirements with
respect to ratings of sovereign issuers;
– require member states to adopt laws imposing liability on
credit rating agencies for an intentional or grossly negligent
failure to abide by the applicable regulations;
– impose mandatory rotation requirements on credit rating
agencies hired by issuers of securities for ratings of
resecuritizations, which may limit the number of years a
credit rating agency can issue ratings for such securities of a
particular issuer;
– impose restrictions on credit rating agencies or
their shareholders if certain ownership thresholds
are crossed; and
– impose additional procedural and substantive requirements
on the pricing of services.
The financial services industry is subject to the potential for
increased regulation in the EU.
Other Jurisdictions
Outside of the U.S. and the EU, regulators and government
officials have also been implementing formal oversight of credit
rating agencies. Ratings is subject to regulations in most of
the foreign jurisdictions in which it operates and continues
to work closely with regulators globally to promote the global
consistency of regulatory requirements. This includes the UK,
which has established a credit rating agencies oversight regime
similar to that in place in the EU, and where Ratings was granted
registration with the Financial Conduct Authority on January
1, 2021. Regulators in additional countries may introduce new
regulations in the future.
For a further discussion of competitive and other risks inherent
in our Ratings business, see Item 1A, Risk Factors, in our Annual
Report on Form 10-K. For a further discussion of the legal and
regulatory environment in our Ratings business, see Note 13 -
Commitments and Contingencies to the consolidated financial
statements under Item 8, Consolidated Financial Statements
and Supplementary Data, in our Annual Report on Form 10-K.
uncertain, but could increase the costs and legal risks relating
to Ratings’ rating activities, or adversely affect our ability to
compete and/or our remuneration, or result in changes in the
demand for credit ratings.
In the normal course of business both in the U.S. and abroad,
Ratings (or the legal entities comprising Ratings) are defendants
in numerous legal proceedings and are often the subject of
government and regulatory proceedings, investigations and
inquiries. Many of these proceedings, investigations and
inquiries relate to the ratings activity of Ratings and are or have
been brought by purchasers of rated securities. In addition,
various government and self-regulatory agencies frequently
make inquiries and conduct investigations into Ratings’
compliance with applicable laws and regulations. Any of these
proceedings, investigations or inquiries could ultimately result
in adverse judgments, damages, fines, penalties or activity
restrictions, which could adversely impact our consolidated
financial condition, cash flows, business or competitive position.
U.S.
The businesses conducted by our Ratings segment are, in certain
cases, regulated under the Credit Rating Agency Reform Act of
2006 (the “Reform Act”), the Dodd-Frank Wall Street Reform and
Consumer Protection Act (the “Dodd Frank Act”), the Securities
Exchange Act of 1934 (the “Exchange Act”) and/or the laws of
the states or other jurisdictions in which they conduct business.
The financial services industry is subject to the potential for
increased regulation in the U.S.
S&P Global Ratings is a credit rating agency that is registered
with the SEC as a Nationally Recognized Statistical Rating
Organization (“NRSRO”). The SEC first began informally
designating NRSROs in 1975 for use of their credit ratings in
the determination of capital charges for registered brokers and
dealers under the SEC’s Net Capital Rule. The Reform Act created
a new SEC registration system for rating agencies that choose
to register as NRSROs. Under the Reform Act, the SEC is given
authority and oversight of NRSROs and can censure NRSROs,
revoke their registration or limit or suspend their registration
in certain cases. The rules implemented by the SEC pursuant
to the Reform Act, the Dodd Frank Act and the Exchange Act
address, among other things, prevention or misuse of material
non-public information, conflicts of interest, documentation and
assessment of internal controls, and improving transparency
of ratings performance and methodologies. The public portions
of the current version of S&P Global Ratings’ Form NRSRO are
available on S&P Global Ratings’ website.
European Union
In the European Union (“EU”), the credit rating industry is
registered and supervised through a pan-European regulatory
framework which is a compilation of three sets of legislative
actions. In 2009, the European Parliament passed a regulation
(“CRA1”) that established an oversight regime for the credit
rating industry in the EU, which became effective in 2010.
CRA1 requires the registration, formal regulation and periodic
inspection of credit rating agencies operating in the EU.
Ratings was granted registration in October of 2011. In January
of 2011, the EU established the European Securities and
S&P Global 2022 Annual Report 29
COMMODITY INSIGHTS
Commodity Insights is a leading independent provider of
information and benchmark prices for the commodity and energy
markets. Commodity Insights provides essential price data,
analytics, industry insights and software & services, enabling
the commodity and energy markets to perform with greater
transparency and efficiency.
Commodity Insights includes the following business lines:
– Energy & Resources Data & Insights — includes data,
news, insights, and analytics for petroleum, gas, power &
renewables, petrochemicals, metals & steel, agriculture, and
other commodities;
– Price Assessments — includes price assessments and
benchmarks, and forward curves;
– Upstream Data & Insights — includes exploration &
production data and insights, software and analytics; and
– Advisory & Transactional Services — includes consulting
services, conferences, events and global trading services.
Commodity Insights’ revenue is generated primarily through the
following sources:
– Subscription revenue — primarily from subscriptions to our
market data and market insights (price assessments, market
reports and commentary and analytics) along with other
information products and software term licenses;
– Sales usage-based royalties — primarily from licensing our
proprietary market price data and price assessments to
commodity exchanges; and
– Non-subscription revenue — conference sponsorship,
consulting engagements, events, and perpetual
software licenses.
See Note 2 - Acquisitions and Divestitures to the consolidated
financial statements under Item 8, Consolidated Financial
Statements and Supplementary Data, in our Annual Report on
Form 10-K for further discussion including information on the
merger with IHS Markit.
The following table provides revenue and segment operating profit information for the years ended December 31:
Year ended December 31,
% Change
(in millions)
Revenue
Subscription revenue
Sales usage-based royalties
Non-subscription revenue
% of total revenue:
Subscription revenue
Sales usage-based royalties
Non-subscription revenue
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
% Operating margin
2022
$1,685
$1,492
$67
$126
89%
4%
7%
$673
$1,012
40%
60%
$591
35%
2021
$1,012
$933
$66
$13
92%
7%
1%
$356
$656
35%
65%
$544
54%
2020
$938
$869
$62
$7
93%
6%
1%
$322
$616
34%
66%
$478
51%
’22 vs ’21
’21 vs ’20
66%
60%
2%
N/M
89%
54%
8%
7%
7%
N/M
11%
6%
9%
14%
N/M Represents a change equal to or in excess of 100% or not meaningful
Note In the first quarter of 2022, the Market Intelligence Commodities business was transferred to the Commodity Insights segment and prior-year amounts have been
reclassified to conform with current presentation.
1
2022 includes employee severance charges of $45 million and IHS Markit merger costs of $26 million. 2021 includes recovery of lease-related costs of $2 million.
2020 includes employee severance charges of $11 million and lease-related costs of $2 million. 2022, 2021, and 2020 includes amortization of intangibles from
acquisitions of $111 million, $8 million, and $9 million, respectively.
30 S&P Global 2022 Annual Report
2022
Revenue increased 66% primarily due to the impact of the
merger with IHS Markit, continued demand for market data and
market insights products driven by expanded product offerings
to our existing customers under enterprise use contracts and
higher conference revenue driven by the return of in-person
attendance at Commodity Insights conferences in 2022
compared to virtual events in 2021. The Energy & Resources
Data & Insights, Price Assessments and Upstream Data &
Insights businesses continue to be the most significant revenue
drivers, followed by the Advisory & Transactional Services
business, which contributed large growth in the first quarter of
2022. Foreign exchange rates had an unfavorable impact of 1
percentage point.
Operating profit increased 9%. Excluding the impact of higher
amortization of intangibles from acquisitions of 19 percentage
points, employee severance charges in 2022 of 8 percentage
points and IHS Markit merger costs in 2022 of 5 percentage
points, operating profit increased 41%. The increase was
primarily due to revenue growth partially offset by expenses
associated with the merger with IHS Markit, an increase in costs
related to the Commodity Insights conferences in 2022, higher
compensation costs, the resumption of business travel from the
lifting of COVID restrictions and an increase in operating costs
to support business initiatives at Commodity Insights. Foreign
exchange rates had a favorable impact of 1 percentage point.
2021
Revenue increased 8% primarily due to continued demand for
market data and market insights products driven by expanded
product offerings to our existing customers under enterprise
use contracts. An increase in sales usage-based royalties from
the licensing of our proprietary market price data and price
assessments to commodity exchanges mainly due to increased
trading volumes in Petroleum and LNG also contributed to
revenue growth. Both U.S. revenue and international revenue
grew compared to 2021.
Operating profit increased 14% with an unfavorable impact from
foreign exchange rates of less than 1 percentage point. Excluding
the impact of higher employee severance charges in 2020 of 3
percentage points and higher lease-related costs in 2020 of 1%,
operating profit increased 10%. The increase was primarily due
to revenue growth partially offset by an increase in operating
costs to support business initiatives at Commodity Insights and
an increase in incentive costs.
Industry Highlights and Outlook
In 2022, the impact of the merger with IHS Markit, sustained
demand for market data and market insights products, new and
enhanced products & services, and higher conference revenue
driven by the return of in-person attendance at Commodity
Insights conferences in 2022 compared to virtual events in 2021
contributed to revenue growth. Commodity Insights continues
to focus on developing new products and product features
leveraging technology investments and developing key product
offerings in ESG, including energy transition.
Legal and Regulatory Environment
Commodity Insights’ price assessment business is subject
to increasing regulatory scrutiny. As discussed below under
the heading “Indices-Legal and Regulatory Environment”,
the benchmarks industry is subject to the new regulation in
the EU (the “EU Benchmark Regulation”) as well as potential
increased regulation in other jurisdictions. Commodity Insights
has obtained authorization and is now supervised by the Dutch
Authority for the Financial Markets in the Netherlands under the
EU Benchmark Regulation, and it will likely need to take similar
steps in other jurisdictions including the United Kingdom when
the transitional period under the EU Benchmark Regulation (and
its UK equivalent) ends, as well as in jurisdictions outside of
Europe if they pass similar legislation.
The EU has enacted MiFID II, which revise and update the
existing EU Markets in Financial Instruments Directive and the
substantive provisions became applicable in all EU Member
States as of January 3, 2018. MiFID II includes provisions
that, among other things: (i) impose new conditions and
requirements on the licensing of benchmarks and provide for
non-discriminatory access to exchanges and clearing houses;
(ii) modify the categorization and treatment of certain classes of
derivatives; (iii) expand the categories of trading venue that are
subject to regulation; (iv) require the unbundling of investment
research and direct how asset managers pay for research either
out of a research payment account or from a firm’s profits; and
(v) provide for the mandatory trading of certain derivatives on
exchanges (complementing the mandatory derivative clearing
requirements in the E.U. Market Infrastructure Regulation of
2011). MiFID II and potential subsequent amendments may
result in changes to the manner in which the Commodity
Insights business licenses its price assessments. MiFID II and
the Market Abuse Regulation (“MAR”) may impose additional
regulatory burdens on Commodity Insights activities in the EU
over time, but they have not yet resulted in increased substantive
impact or costs.
In October of 2012, IOSCO issued its Principles for Oil Price
Reporting Agencies (“PRA Principles”), which are intended to
enhance the reliability of oil price assessments referenced in
derivative contracts subject to regulation by IOSCO members.
Commodity Insights has aligned its operations with the PRA
Principles and, as recommended by IOSCO in its final report on
the PRA Principles, has aligned to the PRA Principles for other
commodities for which it publishes benchmarks.
For a further discussion of competitive and other risks inherent
in our Commodity Insights business, see Item 1A, Risk Factors,
in our Annual Report on Form 10-K. For a further discussion of
the legal and regulatory environment in our Commodity Insights
business, see Note 13 - Commitments and Contingencies to the
consolidated financial statements under Item 8, Consolidated
Financial Statements and Supplementary Data, in our Annual
Report on Form 10-K.
S&P Global 2022 Annual Report 31
MOBILITY
Mobility is a leading provider of solutions serving the full
automotive value chain including vehicle manufacturers (OEMs),
automotive suppliers, mobility service providers, retailers,
consumers, and finance and insurance companies. Mobility
operates globally, with staff located in over 17 countries.
Mobility’s revenue is generated primarily through the
following sources:
– Subscription revenue — Mobility’s core information products
provide critical information and insights to all global OEMs,
most of the world’s leading suppliers, and the majority of
North American dealerships. Mobility operates across both
the new and used car markets. Mobility provides data and
insight on future vehicles sales and production, including
detailed forecasts on technology and vehicle components;
supplies car makers and dealers with market reporting
products, predictive analytics and marketing automation
software; and supports dealers with vehicle history reports,
used car listings and service retention solutions. Mobility
also sells a range of services to financial institutions, to
support their marketing, insurance underwriting and claims
management activities; and
– Non-subscription revenue — One-time transactional sales
of data that are non-cyclical in nature – and that are usually
tied to underlying business metrics such as OEM marketing
spend or safety recall activity – as well as consulting and
advisory services.
The Mobility business was acquired in connection with the
merger with IHS Markit on February 28, 2022 and financial
results are included since the date of acquisition.
The following table provides revenue and segment operating profit information for the years ended December 31:
Year ended December 31,
% Change
(in millions)
Revenue
Subscription revenue
Non-subscription revenue
% of total revenue:
Subscription revenue
Non-subscription revenue
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
% Operating margin
2022
$1,142
$888
$254
78%
22%
$932
$210
82%
18%
$213
19%
2021
$—
$—
$—
—%
—%
$—
$—
—%
—%
$—
—%
2020
’22 vs ’21
’21 vs ’20
$—
$—
$—
—%
—%
$—
$—
—%
—%
$—
—%
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M- Represents a change equal to or in excess of 100% or not meaningful
1
2022 includes an acquisition-related benefit of $14 million, employee severance charges of $4 million and IHS Markit merger costs of $3 million. 2022 also
includes amortization of intangibles from acquisitions of $241 million.
32 S&P Global 2022 Annual Report
Industry Highlights and Outlook
In 2022, Mobility’s revenue was underpinned by strong and
broad-based performance across its businesses. Specifically,
we saw strong new business growth and high retention rates.
Mobility continued to focus on multiple growth opportunities
including: evolving our forecasting business to encompass
new technologies and new forms of mobility; supporting the
industry in its transformation to hybrid and digital retail;
enabling consumers to shop, buy, service and sell used cars;
and, leveraging the power of S&P Global to develop products
for financial markets and to facilitate the industry’s transition
towards sustainable mobility.
Legal and Regulatory Environment
Certain types of information that our Mobility business collects,
compiles, stores, uses, transfers, publishes and/or sells is
subject to laws and regulations in various jurisdictions in which
it operates. There is an increasing public concern regarding, and
resulting regulations of, privacy, data, and consumer protection
issues. Laws and regulations to which our Mobility business is
subject pertain primarily to personally identifiable information
relating to individuals. Such laws and regulations constrain the
collection, use, storage, and transfer of personally identifiable
information, and impose other obligations with which we must
comply. If our Mobility business fails to comply with these laws or
regulations, we could be subject to significant litigation and civil
or criminal penalties (including monetary damages, regulatory
enforcement actions or fines) in one or more jurisdictions and
reputational damage resulting in the loss of data, brand equity
and business. To conduct our operations, our Mobility business
also moves data across national borders and consequently
can be subject to a variety of evolving and developing laws and
regulations regarding privacy, data protection, and data security
in an increasing number of jurisdictions. Many jurisdictions
have passed laws in this area, such as the European Union
General Data Protection Regulation (the “GDPR”), the cyber-
security law adopted by China in 2017, and the 2020 California
Privacy Act, and other jurisdictions are considering imposing
additional restrictions. These laws and regulations are increasing
in complexity and number, change frequently, and increasingly
conflict among the various countries in which our Mobility
business operates, which has resulted in greater compliance risk
and cost for us. It is possible that our Mobility business could
be prohibited or constrained from collecting or disseminating
certain types of data or from providing certain products or
services. If our Mobility business fails to comply with these
laws or regulations, we could be subject to significant litigation,
civil or criminal penalties, monetary damages, regulatory
enforcement actions or fines in one or more jurisdictions. For
example, a failure to comply with the GDPR could result in fines
up to the greater of €20 million or 4% of annual global revenues.
Additional risks are presented by the evolving landscape related
to sanctions and export control laws. The landscape related
to these laws is evolving rapidly and presents compliance
challenges to all businesses covered by these laws.
For a further discussion of competitive and other risks inherent
in our Mobility business, see Item 1A, Risk Factors, in our Annual
Report on Form 10-K. For a further discussion of the legal and
regulatory environment in our Mobility business, see Note 13 -
Commitments and Contingencies to the consolidated financial
statements under Item 8, Consolidated Financial Statements
and Supplementary Data, in our Annual Report on Form 10-K.
S&P Global 2022 Annual Report 33
INDICES
Indices is a global index provider that maintains a wide variety
of valuation and index benchmarks for investment advisors,
wealth managers and institutional investors. Indices’ mission
is to provide transparent benchmarks to help with decision
making, collaborate with the financial community to create
innovative products, and provide investors with tools to
monitor world markets.
During the year ended December 31, 2022, we recorded a pre-
tax gain of $52 million ($43 million after-tax) for the sale of a
family of leveraged loan indices in Gain on dispositions in the
consolidated statements of income.
Indices derives revenue from asset-linked fees when investors
direct funds into its proprietary designed or owned indexes, sales
usage-based royalties of its indices, as well as data subscription
arrangements. Specifically, Indices generates revenue from the
following sources:
– Investment vehicles — asset-linked fees such as ETFs and
mutual funds, that are based on the S&P Dow Jones Indices’
benchmarks that generate revenue through fees based on
assets and underlying funds;
– Exchange traded derivatives — generate sales usage-based
royalties based on trading volumes of derivatives contracts
listed on various exchanges;
– Index-related licensing fees — fixed or variable annual and
per-issue asset-linked fees for over-the-counter derivatives
and retail-structured products; and
– Data and customized index subscription fees — fees
from supporting index fund management, portfolio
analytics and research.
The following table provides revenue and segment operating profit information for the years ended December 31:
Year ended December 31,
% Change
(in millions)
Revenue
Asset-linked fees
Subscription revenue
Sales usage-based royalties
% of total revenue:
Asset-linked fees
Subscription revenue
Sales usage-based royalties
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
Less: net income attributable
to noncontrolling interests
Net operating profit
% Operating margin
% Net operating margin
2022
$1,339
$862
$258
$219
65%
19%
16%
$1,088
$251
81%
19%
$927
$249
$678
69%
51%
2021
$1,149
$800
$191
$158
69%
17%
14%
$959
$190
83%
17%
$798
$215
$583
70%
51%
’22 vs ’21
’21 vs ’20
17%
8%
35%
38%
14%
30%
16%
16%
16%
16%
24%
7%
(4)%
16%
17%
20%
19%
20%
2020
$989
$647
$177
$165
65%
18%
17%
$826
$163
84%
16%
$666
$181
$485
67%
49%
1
2022 includes a gain on disposition of $52 million, employee severance charges of $14 million and IHS Markit merger costs of $2 million. 2021 includes recovery
of lease-related costs of $1 million. 2020 includes employee severance charges of $5 million, a lease impairment charge of $4 million, a technology-related
impairment charge of $2 million and lease-related costs of $1 million. 2022 includes amortization of intangibles from acquisitions of $31 million and 2021 and
2020 includes amortization of intangibles from acquisitions of $6 million.
34 S&P Global 2022 Annual Report
(in millions)
Revenue
Asset-linked fees
Subscription revenue
Sales usage-based royalties
% of total revenue:
Asset-linked fees
Subscription revenue
Sales usage-based royalties
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
Less: net income attributable
to noncontrolling interests
Net operating profit
% Operating margin
% Net operating margin
Year ended December 31,
% Change
’22 vs ’21
’21 vs ’20
2022
$1,339
$862
$258
$219
65%
19%
16%
$1,088
$251
81%
19%
$927
$249
$678
69%
51%
2021
$1,149
$800
$191
$158
69%
17%
14%
$959
$190
83%
17%
$798
$215
$583
70%
51%
2020
$989
$647
$177
$165
65%
18%
17%
$826
$163
84%
16%
$666
$181
$485
67%
49%
17%
8%
35%
38%
14%
30%
16%
16%
16%
16%
24%
7%
(4)%
16%
17%
20%
19%
20%
2022
Revenue at Indices increased 17% primarily due to higher
exchange-traded derivative revenue driven by higher average
trading volume from increased volatility, higher average levels
of assets under management (“AUM”) for mutual funds, higher
data subscription revenue and the impact of the merger with
IHS Markit. Ending AUM for ETFs in 2022 was $2.601 trillion.
Excluding AUM related to the merger with IHS Markit, ending
AUM for ETFs decreased 12% to $2.466 trillion and average
levels of AUM for ETFs increased 5% to $2.526 trillion compared
to 2021. Foreign exchange rates had an unfavorable impact of
less than 1 percentage point.
Operating profit increased 16%. Excluding the impact of a gain
on disposition of 7 percentage points, partially offset by higher
amortization of intangibles from acquisitions of 4 percentage
points and employee severance charges in 2022 of 2 percentage
points, operating profit increased 15%. The impact of revenue
growth and lower incentive costs were partially offset by an
increase in outside services expenses, strategic investments,
higher compensation costs driven by annual merit increases,
higher data costs, the resumption of business travel from the
lifting of COVID restrictions and the impact of the merger with
IHS Markit. Foreign exchange rates had an unfavorable impact
of 1 percentage point.
2021
Revenue at Indices increased 16% primarily due to higher
average levels of AUM for ETFs and mutual funds and higher data
subscription revenue, partially offset by lower exchange-traded
derivative revenue. Average levels of AUM for ETFs increased
44% to $2.419 trillion and ending AUM for ETFs increased
40% to $2.796 trillion compared to 2020 while exchange-
traded derivative activity was impacted by both lower average
daily trading volume from reduced volatility and lower rates
per trade from a shift in product mix in the first half of 2021.
Foreign exchange rates had a favorable impact of less than 1
percentage point.
Operating profit increased 20%. Excluding the impact of
employee severance charges in 2020 of 1 percentage point,
a lease impairment charge in 2020 of 1 percentage point and
higher lease-related costs in 2020 of less than 1 percentage
point, operating profit increased 17%. The impact of revenue
growth and lower legal related costs was partially offset by
higher cost of sales, higher incentive costs and an increase in
compensation costs driven by additional headcount and annual
merit increases. Foreign exchange rates had an unfavorable
impact of less than 1 percentage point.
Industry Highlights and Outlook
Revenue increased in 2022 primarily due to higher exchange-
traded derivative revenue driven by higher average trading
volume from increased volatility, higher average levels of AUM
for mutual funds, higher data subscription revenue and the
impact of the merger with IHS Markit. Indices continues to be
a leading index provider for the ETF market space. In 2022,
Indices continued to launch new Sustainability ETFs and expand
innovative index offerings with index product launches in high
growth areas such as factor and thematic indices and multi-
asset-class indices. Indices continues to focus on developing
new indices and product features leveraging investments in
technology and research and development, as well as close
collaboration with its customers.
Legal and Regulatory Environment
The financial benchmarks industry is subject to specific
benchmark regulation in the European Union (the “EU
Benchmark Regulation”), the United Kingdom (the “UK
Benchmark Regulation”), and Australia (the “Australia
Benchmark Regulation”). Various other jurisdictions, including
the United States, are also considering the regulation of financial
benchmarks through new or existing regimes.
Although they vary in scope, the requirements of the EU
Benchmark Regulation, the UK Benchmark Regulation and the
Australian Benchmark Regulation are similar. Indices currently
maintains a benchmark administrator in both the Netherlands
(authorized by the Dutch Authority for Financial Markets (AFM))
for its benchmark activities in the European Union and in the
United Kingdom (authorized by the Financial Conduct Authority)
for its benchmark activities in the United Kingdom. The EU
Benchmark Regulation and the UK Benchmark Regulation have
and may continue to cause operating obligations, increased
compliance risk and additional costs for Indices. The Australian
Benchmark Regulation requires a license from the Australian
Securities and Investment Commission (“ASIC”), which Indices
has obtained. The Australian Benchmark Regulation has and
may continue to cause increased compliance risk and additional
costs for Indices.
In July of 2013, the IOSCO issued its Principles for Financial
Benchmarks (the “Financial Benchmark Principles”), intended
to promote the reliability of financial benchmarks. The Financial
Benchmark Principles address governance, benchmark quality
and accountability mechanisms, including with regard to the
indices published by Indices. Indices has taken steps to align its
governance regime, control framework and operations with the
Financial Benchmark Principles and engages an independent
auditor to perform an annual reasonable assurance review of its
adherence to the Financial Benchmark Principles.
The markets for index providers are very competitive. Indices
competes domestically and internationally on the basis of a
number of factors, including the quality of its indices, client
service, reputation, price, range of products and services
(including geographic coverage) and technological innovation.
Indices also faces challenges from various disrupters and
attempts to circumvent its licensing regime. Our Indices business
is impacted by market volatility, asset levels or notional values of
investment products based on our indices, and trading volumes
of certain exchange traded derivatives. Volatile capital markets,
as well as changing investment styles, among other factors, may
influence an investor’s decision to invest in and maintain an
investment in an index-linked investment product.
For a further discussion of competitive and other risks inherent
in our Indices business, see Item 1A, Risk Factors, in our Annual
Report on Form 10-K. For a further discussion of the legal and
regulatory environment in our Indices business, see Note 13 -
Commitments and Contingencies to the consolidated financial
statements under Item 8, Consolidated Financial Statements
and Supplementary Data, in our Annual Report on Form 10-K.
S&P Global 2022 Annual Report 35
ENGINEERING SOLUTIONS
Engineering Solutions is a leading provider of engineering
standards and related technical knowledge. Engineering
Solutions includes our Product Design offerings that provide
technical professionals with the information and insight required
to more effectively design products, optimize engineering
projects and outcomes, solve technical problems and address
complex supply chain issues. Our offerings utilize advanced
knowledge discovery technologies, research tools, and software-
based engineering decision engines to advance innovation,
maximize productivity, improve quality and reduce risk.
Engineering Solutions’ revenue is generated primarily through
the following sources:
– Subscription revenue — primarily from subscriptions to our
Product Design offerings providing standards, codes and
specifications; applied technical reference; engineering
journals, reports, best practices, and other vetted technical
reference; and patents and patent applications, which
includes Engineering Workbench; Goldfire’s cognitive search
and other advanced knowledge discovery capabilities
that help pinpoint answers buried in enterprise systems
and unstructured data enabling engineers and technical
professionals to accelerate problem solving; and
– Non-subscription revenue — primarily from retail transaction
and consulting services.
The Engineering Solutions business was acquired in connection
with the merger with IHS Markit on February 28, 2022 and
financial results are included since the date of acquisition.
The following table provides revenue and segment operating profit information for the years ended December 31:
Year ended December 31,
% Change
(in millions)
Revenue
Subscription revenue
Non-subscription revenue
% of total revenue:
Subscription revenue
Non-subscription revenue
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
% Operating margin
2022
$323
$300
$23
93%
7%
$179
$144
55%
45%
$15
5%
2021
$—
$—
$—
—%
—%
$—
$—
—%
—%
$—
—%
2020
’22 vs ’21
’21 vs ’20
$—
$—
$—
—%
—%
$—
$—
—%
—%
$—
—%
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M- Represents a change equal to or in excess of 100% or not meaningful
1
2022 includes employee severance charges of $4 million and amortization of intangibles from acquisitions of $35 million.
Industry Highlights and Outlook
On January 14, 2023, we entered into a securities and asset
purchase agreement with Allium Buyer LLC, a Delaware limited
liability company controlled by funds affiliated with Kohlberg
Kravis Roberts & Co. L.P. (“KKR”) to sell our Engineering Solutions
business for $975 million in cash, subject to customary purchase
price adjustments. We currently anticipate the divestiture to
result in after-tax proceeds of approximately $750 million, which
proceeds are expected to be used for share repurchases. The
agreement follows our announced intent in November of 2022 to
divest the business. Engineering Solutions became part of the
Company following our merger with IHS Markit. The transaction,
which is subject to receipt of required regulatory approvals and
satisfying other customary closing conditions, is expected to
close by the end of the second quarter of 2023.
Legal and Regulatory Environment
The legal and regulatory environment for our Engineering
Solutions business is similar to our Mobility Business. See
“Mobility-Legal and Regulatory Environment” above for
additional details about the legal and regulatory environment for
our Engineering Solutions business.
For a further discussion of competitive and other risks inherent
in our Engineering Solutions business, see Item 1A, Risk
Factors, in our Annual Report on Form 10-K. For a further
discussion of the legal and regulatory environment in our
Engineering Solutions business, see Note 13 - Commitments and
Contingencies to the consolidated financial statements under
Item 8, Consolidated Financial Statements and Supplementary
Data, in our Annual Report on Form 10-K.
36 S&P Global 2022 Annual Report
Liquidity and Capital Resources
We continue to maintain a strong financial position. Our primary
source of funds for operations is cash from our businesses
and our core businesses have been strong cash generators. In
2023, cash on hand, cash flows from operations and availability
under our existing credit facility are expected to be sufficient
to meet any additional operating and recurring cash needs
in the short term and into the foreseeable future. We use our
cash for a variety of needs, including but not limited to: ongoing
investments in our businesses, strategic acquisitions, share
repurchases, dividends, repayment of debt, capital expenditures
and investment in our infrastructure.
in 2021, primarily due to cash received from the dispositions
of CUSIP Global Services, Oil Price Information Services, the
Leveraged Commentary and Data business and a related
family of leveraged loan indices, and the Base Chemicals
business in 2022.
Cash used for investing activities decreased to $0.1 billion for
2021 as compared to $0.2 billion in 2020, primarily due to higher
cash paid for acquisitions in 2020 for the ESG Ratings Business
from RobecoSAM and Greenwich Associates LLC.
Refer to Note 2 – Acquisitions and Divestitures to the
Consolidated Financial Statements and Supplementary Data, in
the Annual Report on Form 10-K for further information.
(in millions)
Revenue
Subscription revenue
Non-subscription revenue
% of total revenue:
Subscription revenue
Non-subscription revenue
U.S. revenue
International revenue
% of total revenue:
U.S. revenue
International revenue
Operating profit 1
% Operating margin
2022
$323
$300
$23
93%
7%
$179
$144
55%
45%
$15
5%
2021
$—
$—
$—
—%
—%
$—
$—
—%
—%
$—
—%
$—
$—
$—
—%
—%
$—
$—
—%
—%
$—
—%
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
N/M
Year ended December 31,
% Change
(in millions)
2022
2021
2020
2020
’22 vs ’21
’21 vs ’20
Net cash provided by (used for):
Cash Flow Overview
Cash, cash equivalents, and restricted cash were $1.3 billion as
of December 31, 2022, a decrease of $5.2 billion as compared to
December 31, 2021.
Year ended December 31,
Operating activities
Investing activities
Financing activities
$2,603
$3,598
$3,567
3,628
(11,326)
(120)
(1,013)
(240)
(2,166)
In 2022 free cash flow decreased to $2.2 billion compared to
2021 primarily due to a decrease in cash provided by operating
activities as discussed below. Free cash flow is a non-GAAP
financial measure and reflects our cash flow provided by
operating activities less capital expenditures and distributions
to noncontrolling interest holders. Capital expenditures
include purchases of property and equipment and additions to
technology projects. See “Reconciliation of Non-GAAP Financial
Information” below for a reconciliation of cash flow provided by
operating activities, the most directly comparable U.S. GAAP
financial measure, to free cash flow.
Operating activities
Cash provided by operating activities decreased to $2.6 billion
compared to 2021. The decrease is mainly due to a decrease in
operating results, an increase in IHS Markit merger costs, higher
taxes paid on divestitures and a grant payment to the S&P Global
Foundation in 2022.
Cash provided by operating activities remained unchanged
at $3.6 billion as compared to 2020 as higher operating
results in 2021 were offset by the acceleration of payments to
vendors, higher incentive compensation payments and higher
income tax payments.
Investing activities
Our cash outflows from investing activities are primarily for
acquisitions and capital expenditures, while cash inflows are
primarily proceeds from dispositions.
Cash provided for investing activities was $3.6 billion for 2022
as compared to cash used for investing activities of $0.1 billion
Financing activities
Our cash outflows from financing activities consist primarily of
share repurchases, dividends and repayment of short-term and
long-term debt, while cash inflows are primarily inflows from
long-term and short-term debt borrowings and proceeds from
the exercise of stock options.
Cash used for financing activities increased to $11.3
billion in 2022 from $1.0 billion in 2021. The increase is
primarily attributable to an increase in cash used for share
repurchases in 2022.
Cash used for financing activities decreased to $1.0
billion in 2021 from $2.2 billion in 2020. The decrease is
primarily attributable to a decrease in cash used for share
repurchases in 2021.
During the year ended December 31, 2022, we purchased a total
of 33.5 million shares for $12.0 billion of cash. During the year
ended December 31, 2021, we did not use cash to purchase any
shares. During the year ended December 31, 2020, we purchased
a total of 4.0 million shares for $1,161 million of cash. During the
fourth quarter of 2019, we repurchased shares for $3 million,
which settled in the first quarter of 2020, resulting in $1,164
million of cash used to repurchase shares. See Note 9 — Equity
to the Consolidated Financial Statements and Supplementary
Data, in the Annual Report on Form 10-K for information related
to our accelerated share repurchase (“ASR”) agreements.
On June 22, 2022, the Board of Directors approved a share
repurchase program authorizing the purchase of 30 million
shares (the “2022 Repurchase Program”), which was
approximately 9% of the total shares of our outstanding common
stock at that time. On January 29, 2020, the Board of Directors
approved a share repurchase program authorizing the purchase
of 30 million shares (the “2020 Repurchase Program”), which
was approximately 12% of the total shares of our outstanding
common stock at that time. On December 4, 2013, the Board
of Directors approved a share repurchase program authorizing
the purchase of 50 million shares (the “2013 Repurchase
Program”), which was approximately 18% of the total shares of
our outstanding common stock at that time. As of December
31, 2022, 27.2 million shares remained available under the
2022 Repurchase Program and the 2020 and 2013 repurchase
programs were completed.
S&P Global 2022 Annual Report 37
Additional Financing
We have the ability to borrow a total of $2.0 billion through our
commercial paper program, which is supported by our $2.0
billion five-year credit agreement (our “credit facility”) that will
terminate on April 26, 2026. On April 26, 2021, we entered into
a revolving $1.5 billion five-year credit agreement that included
an accordion feature which allowed the Company to increase
the total commitments thereunder by up to an additional $500
million, subject to certain customary terms and conditions. On
February 25, 2022, we exercised the accordion feature which
increased the total commitments available under our credit
facility from $1.5 billion to $2.0 billion. As of December 31, 2022
there was $188 million of commercial paper outstanding.
Commitment fees for the unutilized commitments under the
credit facility and applicable margins for borrowings thereunder
are linked to the Company achieving three environmental
sustainability performance indicators related to emissions,
tested annually. We currently pay a commitment fee of 8 basis
points. The credit facility contains customary affirmative and
negative covenants and customary events of default. The
occurrence of an event of default could result in an acceleration
of the obligations under the credit facility.
The only financial covenant required under our credit facility is
that our indebtedness to cash flow ratio, as defined in our credit
facility, was not greater than 4 to 1, and this covenant level has
never been exceeded.
Dividends
On January 25, 2023, the Board of Directors approved a quarterly
common stock dividend of $0.90 per share
Supplemental Guarantor Financial Information
The senior notes described below were issued by S&P Global
Inc. and are fully and unconditionally guaranteed by Standard &
Poor’s Financial Services LLC, a 100% owned subsidiary of the
Company. Issuances of all senior notes described below have
been registered with the SEC.
– On August 13, 2020, we issued $600 million of 1.25%
senior notes due in 2030 and $700 million of 2.3% senior
notes due in 2060.
– On November 26, 2019, we issued $500 million of 2.5%
senior notes due in 2029 and $600 million of 3.25% senior
notes due in 2049.
– On May 17, 2018, we issued $500 million of 4.5% senior
notes due in 2048.
– On September 22, 2016, we issued $500 million of 2.95%
senior notes due in 2027.
– On May 26, 2015, we issued $700 million of 4.0% senior
notes due in 2025.
– On November 2, 2007 we issued $400 million of 6.55% Senior
Notes due 2037.
– On January 31, 2023, S&P Global Inc. launched an offer to
exchange the following series of unregistered new senior
notes for senior notes of like principal amount and terms
that have been registered with the SEC and will be issued
by S&P Global Inc. and guaranteed by Standard & Poor’s
Financial Services LLC:
– Up to $701 million of 4.75% Senior Notes due 2028 that
were issued on March 2, 2022;
– Up to $930 million of 4.25% Senior Notes due 2029 that
were issued on March 2, 2022;
– Up to $1,250 million of 2.45% Senior Notes due 2027 that
were issued on March 18, 2022;
– Up to $1,250 million of 2.70% Sustainability-Linked Senior
Notes due 2029 that were issued on March 18, 2022;
– Up to $1,500 million of 2.90% Senior Notes due 2032 that
were issued on March 18, 2022;
– Up to $1,000 million of 3.7% Senior Notes due 2052 that
were issued on March 18, 2022; and
– Up to $500 million of 3.9% Senior Notes due 2062 that
were issued on March 18, 2022.
The notes above are unsecured and unsubordinated and rank
equally and ratably with all of our existing and future unsecured
and unsubordinated debt. The guarantees are the subsidiary
guarantor’s unsecured and unsubordinated debt and rank
equally and ratably with all of the subsidiary guarantor’s existing
and future unsecured and unsubordinated debt.
The guarantees of the subsidiary guarantor may be released
and discharged upon (i) a sale or other disposition (including by
way of consolidation or merger) of the subsidiary guarantor or
the sale or disposition of all or substantially all the assets of the
subsidiary guarantor (in each case other than to the Company
or a person who, prior to such sale or other disposition, is an
affiliate of the Company); (ii) upon defeasance or discharge of
any applicable series of the notes, as described above; or (iii)
at such time as the subsidiary guarantor ceases to guarantee
indebtedness for borrowed money, other than a discharge
through payment thereon, under any Credit Facility of the
Company, other than any such Credit Facility of the Company the
guarantee of which by the subsidiary guarantor will be released
concurrently with the release of the subsidiary guarantor’s
guarantees of the notes.
Other subsidiaries of the Company do not guarantee the
registered debt securities of either S&P Global Inc. or Standard
& Poor’s Financial Services LLC (the “Obligor Group”) which are
referred to as the “Non-Obligor Group”.
The following tables set forth the summarized financial
information of the Obligor Group on a combined basis. This
summarized financial information excludes the Non-Obligor
Group. Intercompany balances and transactions between
members of the Obligor Group have been eliminated. This
information is not intended to present the financial position
or results of operations of the Obligor Group in accordance
with U.S. GAAP.
38 S&P Global 2022 Annual Report
Summarized results of operations for the year ended December
31 is as follows:
(in millions)
Revenue
Operating Profit
Net Income
Net income attributable to S&P Global Inc.
2022
$2,752
1,496
1,227
1,227
Summarized balance sheet information as of
December 31 is as follows:
(in millions)
Current assets (excluding intercompany
from Non-Obligor Group)
Noncurrent assets
Current liabilities (excluding
intercompany to Non-Obligor Group)
Noncurrent liabilities
Intercompany payables to
Non-Obligor Group
2022
2021
$699
$6,124
1,410
846
1,046
1,307
11,172
5,242
11,926
4,851
S&P Global 2022 Annual Report 39
CONTRACTUAL OBLIGATIONS
We typically have various contractual obligations, which are
recorded as liabilities in our consolidated balance sheets, while
other items, such as certain purchase commitments and other
executory contracts, are not recognized, but are disclosed herein.
For example, we are contractually committed to contracts for
information-technology outsourcing, certain enterprise-wide
information-technology software licensing and maintenance.
We believe that the amount of cash and cash equivalents on
hand, cash flows expected from operations and availability
under our credit facility will be adequate for us to execute our
business strategy and meet anticipated requirements for lease
obligations, capital expenditures, working capital and debt
service for 2023.
The following table summarizes our significant contractual
obligations and commercial commitments as of December 31,
2022, over the next several years. Additional details regarding
these obligations are provided in the notes to our consolidated
financial statements, as referenced in the footnotes to the table:
(in millions)
Debt: 1
Principal payments
Interest payments
Operating leases 2
Purchase obligations and other 3
Less than
1 Year
1-3
Years
3-5
Years
More than
5 Years
Total
$226
339
138
398
$52
679
216
388
$1,736
$8,942
$10,956
640
170
106
3,305
261
5
4,963
785
897
Total contractual cash obligations
$1,101
$1,335
$2,652
$12,513
$17,601
1
2
3
Our debt obligations are described in Note 5 – Debt to our consolidated financial statement.
See Note 13 – Commitments and Contingencies to our consolidated financial statements for further discussion on our operating lease obligations.
Other consists primarily of commitments for unconditional purchase obligations in contracts for information-technology outsourcing and certain enterprise-wide
information-technology software licensing and maintenance.
As of December 31, 2022, we had $223 million of liabilities for
unrecognized tax benefits. We have excluded the liabilities for
unrecognized tax benefits from our contractual obligations
table because, until formal resolutions are reached, reasonable
estimates of the timing of cash settlements with the respective
taxing authorities are not practicable.
As of December 31, 2022, we have recorded $3,267 million for
our redeemable noncontrolling interest in our S&P Dow Jones
Indices LLC partnership discussed in Note 9 – Equity to our
consolidated financial statements. Specifically, this amount
relates to the put option under the terms of the operating
agreement of S&P Dow Jones Indices LLC, whereby, after
December 31, 2017, CME Group and CME Group Index Services
LLC (“CGIS”) has the right at any time to sell, and we are obligated
to buy, at least 20% of their share in S&P Dow Jones Indices LLC.
We have excluded this amount from our contractual obligations
table because we are uncertain as to the timing and the ultimate
amount of the potential payment we may be required to make.
We make contributions to our pension and postretirement plans
in order to satisfy minimum funding requirements as well as
additional contributions that we consider appropriate to improve
the funded status of our plans. During 2022, we contributed $11
million to our retirement plans. Expected employer contributions
in 2023 are $10 million and $3 million for our retirement and
postretirement plans, respectively. In 2023, we may elect to
make additional non-required contributions depending on
investment performance and the pension plan status. See Note
7 – Employee Benefits to our consolidated financial statements
for further discussion.
40 S&P Global 2022 Annual Report
(in millions)
Debt: 1
Principal payments
Interest payments
Operating leases 2
Purchase obligations and other 3
Less than
1 Year
1-3
Years
3-5
More than
Years
5 Years
Total
$226
339
138
398
$52
679
216
388
$1,736
640
170
106
$8,942
3,305
261
5
$10,956
4,963
785
897
Total contractual cash obligations
$1,101
$1,335
$2,652
$12,513
$17,601
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S&P Global 2022 Annual Report 41
Reconciliation of Non-GAAP
Financial Information
Free cash flow is a non-GAAP financial measure and reflects
our cash flow provided by operating activities less capital
expenditures and distributions to noncontrolling interest
holders. Capital expenditures include purchases of property and
equipment and additions to technology projects. Our cash flow
provided by operating activities is the most directly comparable
U.S. GAAP financial measure to free cash flow.
We believe the presentation of free cash flow allows our investors
to evaluate the cash generated from our underlying operations
in a manner similar to the method used by management. We use
free cash flow to conduct and evaluate our business because
we believe it typically presents a more conservative measure
of cash flows since capital expenditures and distributions to
noncontrolling interest holders are considered a necessary
component of ongoing operations. Free cash flow is useful for
management and investors because it allows management
and investors to evaluate the cash available to us to prepay
debt, make strategic acquisitions and investments and
repurchase stock.
The presentation of free cash flow is not intended to be
considered in isolation or as a substitute for the financial
information prepared and presented in accordance with U.S.
GAAP. Free cash flow, as we calculate it, may not be comparable
to similarly titled measures employed by other companies.
The following table presents a reconciliation of our cash flow
provided by operating activities to free cash flow:
(in millions)
Cash provided by operating activities
Capital expenditures
Distributions to noncontrolling
interest holders
Free cash flow
(in millions)
Cash provided by (used for) investing activities
Cash used for financing activities
Year ended December 31,
% Change
2022
$2,603
(89)
(270)
$2,244
2022
3,628
(11,326)
2021
$3,598
(35)
(227)
$3,336
2021
(120)
(1,013)
2020
$3,567
(76)
(194)
$3,297
’22 vs ’21
’21 vs ’20
(28)%
1%
(33)%
1%
2020
(240)
(2,166)
’22 vs ’21
’21 vs ’20
N/M
N/M
(50)%
(53)%
N/M – Represents a change equal to or in excess of 100% or not meaningful
42 S&P Global 2022 Annual Report
(in millions)
Cash provided by operating activities
Capital expenditures
Distributions to noncontrolling
interest holders
Free cash flow
Year ended December 31,
% Change
2020
$3,567
(76)
(194)
$3,297
’22 vs ’21
’21 vs ’20
(28)%
1%
(33)%
1%
(in millions)
Cash provided by (used for) investing activities
Cash used for financing activities
2020
(240)
(2,166)
’22 vs ’21
’21 vs ’20
N/M
N/M
(50)%
(53)%
2022
$2,603
(89)
(270)
$2,244
2022
3,628
(11,326)
2021
$3,598
(35)
(227)
$3,336
2021
(120)
(1,013)
Critical Accounting Estimates
Our discussion and analysis of our financial condition and
results of operations is based upon our consolidated financial
statements, which have been prepared in accordance with U.S.
GAAP. The preparation of these financial statements requires
us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses and related
disclosure of contingent assets and liabilities.
On an ongoing basis, we evaluate our estimates and
assumptions, including those related to revenue recognition,
business combinations, allowance for doubtful accounts,
valuation of long-lived assets, goodwill and other intangible
assets, pension plans, incentive compensation and stock-based
compensation, income taxes, contingencies and redeemable
noncontrolling interests. We base our estimates on historical
experience, current developments and on various other
assumptions that we believe to be reasonable under these
circumstances, the results of which form the basis for making
judgments about carrying values of assets and liabilities
that cannot readily be determined from other sources. There
can be no assurance that actual results will not differ from
those estimates.
Management considers an accounting estimate to be critical if
it required assumptions to be made that were uncertain at the
time the estimate was made and changes in the estimate or
different estimates could have a material effect on our results
of operations. Management has discussed the development
and selection of our critical accounting estimates with the Audit
Committee of our Board of Directors. The Audit Committee has
reviewed our disclosure relating to them in this MD&A.
We believe the following critical accounting policies require us to
make significant judgments and estimates in the preparation of
our consolidated financial statements:
Revenue recognition
Under ASC 606, revenue is recognized when a customer obtains
control of promised goods or services in an amount that reflects
the consideration the entity expects to receive in exchange for
those goods or services. See Note 1 - Accounting Policies to our
consolidated financial statements for further information.
Business combinations
We apply the purchase method of accounting to our business
combinations. All of the assets acquired, liabilities assumed,
and contingent consideration are allocated based on their
estimated fair values. Fair value determinations involve
significant estimates and assumptions about several highly
subjective variables, including future cash flows, discount rates,
and expected business performance. There are also different
valuation models and inputs for each component, the selection
of which requires considerable judgment. Our estimates and
assumptions may be based, in part, on the availability of
listed market prices or other transparent market data. These
determinations will affect the amount of amortization expense
recognized in future periods. We base our fair value estimates
on assumptions we believe are reasonable, but recognize that
the assumptions are inherently uncertain. Depending on the
size of the purchase price of a particular acquisition, the mix of
intangible assets acquired, and expected business performance,
the purchase price allocation could be materially impacted by
applying a different set of assumptions and estimates.
Allowance for doubtful accounts
The allowance for doubtful accounts reserve methodology
is based on historical analysis, a review of outstanding
balances and current conditions, and by incorporating data
points that provide indicators of future economic conditions
including forecasted industry default rates and industry index
benchmarks. In determining these reserves, we consider,
amongst other factors, the financial condition and risk profile
of our customers, areas of specific or concentrated risk as well
as applicable industry trends or market indicators. The impact
on operating profit for a one percentage point change in the
allowance for doubtful accounts is approximately $25 million.
We incorporate the forecasted impact of future economic
conditions into our allowance for doubtful accounts
measurement process. In times of economic turmoil, including
COVID-19, our estimates and judgments with respect to the
collectability of our receivables are subject to greater uncertainty
than in more stable periods. Based on our current outlook these
assumptions are not expected to significantly change in 2023.
Accounting for the impairment of long-lived
assets (including other intangible assets)
We evaluate long-lived assets for impairment whenever events
or changes in circumstances indicate that the carrying amount
of an asset may not be recoverable. Upon such an occurrence,
recoverability of assets to be held and used is measured by
comparing the carrying amount of an asset to current forecasts
of undiscounted future net cash flows expected to be generated
by the asset. If the carrying amount of the asset exceeds its
estimated future cash flows, an impairment charge is recognized
equal to the amount by which the carrying amount of the asset
exceeds the fair value of the asset. For long-lived assets held for
sale, assets are written down to fair value, less cost to sell. Fair
value is determined based on market evidence, discounted cash
flows, appraised values or management’s estimates, depending
upon the nature of the assets.
Goodwill and indefinite-lived intangible assets
Goodwill represents the excess of purchase price and related
costs over the value assigned to the net tangible and identifiable
intangible assets of businesses acquired. As of December
31, 2022 and 2021, the carrying value of goodwill and other
indefinite-lived intangible assets was $35.4 billion and $4.4
billion, respectively. Goodwill and other intangible assets with
indefinite lives are not amortized, but instead are tested for
impairment annually during the fourth quarter each year or more
frequently if events or changes in circumstances indicate that
the asset might be impaired.
S&P Global 2022 Annual Report 43
Goodwill
As part of our annual impairment test of our six reporting units,
we initially perform a qualitative analysis evaluating whether
any events and circumstances occurred that provide evidence
that it is more likely than not that the fair value of any of our
reporting units is less than its carrying amount. Reporting
units are generally an operating segment or one level below an
operating segment. Our qualitative assessment included, but
was not limited to, consideration of macroeconomic conditions,
industry and market conditions, cost factors, cash flows,
changes in key Company personnel and our share price. If, based
on our evaluation of the events and circumstances that occurred
during the year we do not believe that it is more likely than not
that the fair value of any of our reporting units is less than its
carrying amount, no quantitative impairment test is performed.
Conversely, if the results of our qualitative assessment
determine that it is more likely than not that the fair value of any
of our reporting units is less than its respective carrying amount
we perform a quantitative impairment test. If the fair value of
the reporting unit is less than the carrying value, the difference
is recognized as an impairment charge. For 2022, based on our
qualitative assessments, we determined that it is more likely
than not that our reporting units’ fair values were greater than
their respective carrying amounts.
Indefinite-Lived Intangible Assets
We evaluate the recoverability of indefinite-lived intangible
assets by first performing a qualitative analysis evaluating
whether any events and circumstances occurred that provide
evidence that it is more likely than not that the indefinite-lived
asset is impaired. If, based on our evaluation of the events and
circumstances that occurred during the year we do not believe
that it is more likely than not that the indefinite-lived asset
is impaired, no quantitative impairment test is performed.
Conversely, if the results of our qualitative assessment
determine that it is more likely than not that the indefinite-lived
asset is impaired, a quantitative impairment test is performed.
If necessary, an impairment analysis is performed using the
income approach to estimate the fair value of the indefinite-lived
intangible asset. If the intangible asset carrying value exceeds
its fair value, an impairment charge is recognized in an amount
equal to that excess. Significant judgments inherent in these
analyses include estimating the amount and timing of future
cash flows and the selection of appropriate discount rates,
royalty rates and long-term growth rate assumptions. Changes
in these estimates and assumptions could materially affect the
determination of fair value for this indefinite-lived intangible
asset and could result in an impairment charge, which could be
material to our financial position and results of operations.
We performed our impairment assessment of goodwill and
indefinite-lived intangible assets and concluded that no
impairment existed for the years ended December 31, 2022,
2021, and 2020.
Retirement plans and postretirement
healthcare and other benefits
Our employee pension and other postretirement benefit costs
and obligations are dependent on assumptions concerning
the outcome of future events and circumstances, including
compensation increases, long-term return on pension plan
assets, discount rates and other factors. In determining such
assumptions, we consult with outside actuaries and other
advisors where deemed appropriate. In accordance with
relevant accounting standards, if actual results differ from our
assumptions, such differences are deferred and amortized over
the estimated remaining lifetime of the plan participants. While
we believe that the assumptions used in these calculations
are reasonable, differences in actual experience or changes in
assumptions could affect the expense and liabilities related to
our pension and other postretirement benefits.
The following is a discussion of some significant assumptions
that we make in determining costs and obligations for pension
and other postretirement benefits:
– Discount rate assumptions are based on current yields on
high-grade corporate long-term bonds.
– The expected return on assets assumption is calculated
based on the plan’s asset allocation strategy and projected
market returns over the long-term.
Our discount rate and return on asset assumptions used to determine the net periodic pension and postretirement benefit cost on
our U.S. retirement plans are as follows:
January 1
Discount rate
Return on assets
Retirement Plans
Postretirement Plans
2023
2022
2021
2023
2022
2021
5.63%
6.00%
3.05%
4.00%
2.75%
5.00%
5.52%
2.72%
2.20%
44 S&P Global 2022 Annual Report
As of December 31, 2022, the Company had $1.1 billion in
pension benefit obligation for our U.S. retirement plans. A 0.25
percentage point increase or decrease in the discount rate would
result in an estimated decrease or increase to the accumulated
benefit obligation of approximately $30 million and an increase
or decrease in 2023 pension expense of approximately $1 million.
An increase or decrease of 1 percentage point in the expected
rate of return on plan assets would result in a decrease or
increase of approximately $14 million to 2023 pension expense.
Stock-based compensation
Stock-based compensation expense is measured at the grant
date based on the fair value of the award and is recognized over
the requisite service period, which typically is the vesting period.
Stock-based compensation is classified as both operating-
related expense and selling and general expense in our
consolidated statements of income.
Income taxes
Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between financial
statement carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets and liabilities
are measured using enacted tax rates expected to be applied to
taxable income in the years in which those temporary differences
are expected to be recovered or settled. We recognize liabilities
for uncertain tax positions taken or expected to be taken in
income tax returns. Accrued interest and penalties related to
unrecognized tax benefits are recognized in interest expense and
operating expense, respectively.
Judgment is required in determining our provision for income
taxes, deferred tax assets and liabilities and unrecognized tax
benefits. In determining the need for a valuation allowance, the
historical and projected financial performance of the operation
that is recording a net deferred tax asset is considered along
with any other pertinent information.
We file income tax returns in the U.S. federal jurisdiction and
various state and foreign jurisdictions, and we are routinely
under audit by many different tax authorities. We believe that
our accrual for tax liabilities is adequate for all open audit
years based on an assessment of many factors including past
experience and interpretations of tax law. This assessment
relies on estimates and assumptions and may involve a series
of complex judgments about future events. It is possible that
tax examinations will be settled prior to December 31, 2023. If
any of these tax audit settlements do occur within that period,
we would make any necessary adjustments to the accrual for
unrecognized tax benefits.
As of December 31, 2022, we have approximately $10.1 billion of
undistributed earnings of our foreign subsidiaries, of which $4.1
billion is reinvested indefinitely in our foreign operations.
Contingencies
We are subject to a number of lawsuits and claims that arise
in the ordinary course of business. We recognize a liability for
such contingencies when both (a) information available prior to
issuance of the financial statements indicates that it is probable
that a liability had been incurred at the date of the financial
statements and (b) the amount of loss can reasonably be
estimated. We continually assess the likelihood of any adverse
judgments or outcomes to our contingencies, as well as potential
amounts or ranges of probable losses, and recognize a liability, if
any, for these contingencies based on an analysis of each matter
with the assistance of outside legal counsel and, if applicable,
other experts. Because many of these matters are resolved
over long periods of time, our estimate of liabilities may change
due to new developments, changes in assumptions or changes
in our strategy related to the matter. When we accrue for loss
contingencies and the reasonable estimate of the loss is within a
range, we record its best estimate within the range. We disclose
an estimated possible loss or a range of loss when it is at least
reasonably possible that a loss may have been incurred.
Redeemable Noncontrolling Interest
The fair value component of the redeemable noncontrolling
interest in Indices business is based on a combination of
an income and market valuation approach. Our income and
market valuation approaches may incorporate Level 3 fair
value measures for instances when observable inputs are
not available. The more significant judgmental assumptions
used to estimate the value of the S&P Dow Jones Indices LLC
joint venture include an estimated discount rate, a range of
assumptions that form the basis of the expected future net cash
flows (e.g., the revenue growth rates and operating margins),
and a company specific beta. The significant judgmental
assumptions used that incorporate market data, including the
relative weighting of market observable information and the
comparability of that information in our valuation models, are
forward-looking and could be affected by future economic and
market conditions.
As of December 31, 2022, the Company had $3.3 billion in
redeemable noncontrolling interest on the Consolidated
Balance Sheet. The ultimate amount paid for the redeemable
noncontrolling interest in Indices business could be significantly
different because the redemption amount depends on the future
results of operations of the business.
As of December 31, 2022, the weighted average cost of capital
used in the Company’s income analysis to estimate the fair
value of the redeemable noncontrolling interest was 11%. A 0.25
percentage point increase or decrease in the weighted average
cost of capital would decrease or increase the redemption value
by approximately $81 million. As of December 31, 2022, the
terminal growth rate used in the Company’s income analysis to
estimate the fair value of the redeemable noncontrolling interest
was 2.2%. A 0.25 percentage point increase or decrease in the
terminal growth rate would increase or decrease the redemption
value by approximately $27 million.
Recent Accounting Standards
See Note 1 – Accounting Policies to our consolidated financial
statements for a detailed description of recent accounting
standards. We do not expect these recent accounting standards
to have a material impact on our results of operations, financial
condition, or liquidity in future periods.
S&P Global 2022 Annual Report 45
Forward-Looking Statements
This report contains “forward-looking statements,” as defined
in the Private Securities Litigation Reform Act of 1995. These
statements, including statements about the completed merger
(the “Merger”) between a subsidiary of the Company and IHS
Markit Ltd. (“IHS Markit”), which express management’s current
views concerning future events, trends, contingencies or results,
appear at various places in this report and use words like
“anticipate,” “assume,” “believe,” “continue,” “estimate,” “expect,”
“forecast,” “future,” “intend,” “plan,” “potential,” “predict,” “project,”
“strategy,” “target” and similar terms, and future or conditional
tense verbs like “could,” “may,” “might,” “should,” “will” and “would.”
For example, management may use forward-looking statements
when addressing topics such as: the outcome of contingencies;
future actions by regulators; changes in the Company’s business
strategies and methods of generating revenue; the development
and performance of the Company’s services and products; the
expected impact of acquisitions and dispositions; the Company’s
effective tax rates; and the Company’s cost structure, dividend
policy, cash flows or liquidity.
Forward-looking statements are subject to inherent risks and
uncertainties. Factors that could cause actual results to differ
materially from those expressed or implied in forward-looking
statements include, among other things:
– worldwide economic, financial, political, and regulatory
conditions, and factors that contribute to uncertainty and
volatility, natural and man-made disasters, civil unrest,
pandemics (e.g., COVID-19), geopolitical uncertainty
(including military conflict), and conditions that may result
from legislative, regulatory, trade and policy changes;
– the volatility and health of debt, equity, commodities and
energy markets, including credit quality and spreads, the level
of liquidity and future debt issuances, demand for investment
products that track indices and assessments and trading
volumes of certain exchange traded derivatives;
– the demand and market for credit ratings in and across the
sectors and geographies where the Company operates;
– the Company’s exposure to potential criminal sanctions
or civil penalties for noncompliance with foreign and U.S.
laws and regulations that are applicable in the jurisdictions
in which it operates, including sanctions laws relating to
countries such as Iran, Russia, Sudan, Syria and Venezuela,
anti-corruption laws such as the U.S. Foreign Corrupt
Practices Act and the U.K. Bribery Act of 2010, and local laws
prohibiting corrupt payments to government officials, as well
as import and export restrictions;
– the continuously evolving regulatory environment in Europe,
the United States and elsewhere around the globe affecting
each of our business divisions and the products our business
divisions offer, and our compliance therewith;
– the ability of the Company to implement its plans, forecasts
and other expectations with respect to IHS Markit’s business
and realize expected synergies;
– business disruption following the Merger;
– the Company’s ability to meet expectations regarding the
accounting and tax treatments of the Merger;
– the Company’s ability to make acquisitions and dispositions
and successfully integrate the businesses we acquire;
– consolidation of the Company’s customers, suppliers
or competitors;
– the introduction of competing products or technologies by
other companies;
– the effect of competitive products and pricing, including
the level of success of new product developments and
global expansion;
– the impact of customer cost-cutting pressures;
– a decline in the demand for our products and services by our
customers and other market participants;
– the ability of the Company, and its third-party service
providers, to maintain adequate physical and technological
infrastructure;
– the Company’s ability to maintain adequate physical,
– the Company’s ability to successfully recover from a
technical and administrative safeguards to protect the
security of confidential information and data, and the
potential for a system or network disruption that results
in regulatory penalties and remedial costs or improper
disclosure of confidential information or data;
– the outcome of litigation, government and regulatory
proceedings, investigations and inquiries;
– concerns in the marketplace affecting the Company’s
credibility or otherwise affecting market perceptions of the
integrity or utility of independent credit ratings, benchmarks,
indices and other services;
– our ability to attract, incentivize and retain key employees,
especially in a competitive business environment;
disaster or other business continuity problem, such as an
earthquake, hurricane, flood, civil unrest, protests, military
conflict, terrorist attack, outbreak of pandemic or contagious
diseases, security breach, cyber attack, data breach,
power loss, telecommunications failure or other natural or
man-made event;
– the level of merger and acquisition activity in the United
States and abroad;
– the level of the Company’s future cash flows and
capital investments;
– the impact on the Company’s revenue and net income caused
by fluctuations in foreign currency exchange rates; and
– the impact of changes in applicable tax or accounting
requirements on the Company.
46 S&P Global 2022 Annual Report
The factors noted above are not exhaustive. The Company and
its subsidiaries operate in a dynamic business environment in
which new risks emerge frequently. Accordingly, the Company
cautions readers not to place undue reliance on any forward-
looking statements, which speak only as of the dates on
which they are made. The Company undertakes no obligation
to update or revise any forward-looking statement to reflect
events or circumstances arising after the date on which
it is made, except as required by applicable law. Further
information about the Company’s businesses, including
information about factors that could materially affect its
results of operations and financial condition, is contained in
the Company’s filings with the SEC, including Item 1A, Risk
Factors, in our Annual Report on Form 10-K.
S&P Global 2022 Annual Report 47
Consolidated Statements of Income
(in millions, except per share data)
Revenue
Expenses:
Operating-related expenses
Selling and general expenses
Depreciation
Amortization of intangibles
Total expenses
Gain on dispositions
Equity in income on unconsolidated subsidiaries
Operating profit
Other income, net
Interest expense, net
Loss on extinguishment of debt
Income before taxes on income
Provision for taxes on income
Net income
Less: net income attributable to noncontrolling interests
Year Ended December 31,
2022
$11,181
3,766
3,383
108
905
8,162
(1,898)
(27)
4,944
(70)
304
8
4,702
1,180
3,522
(274)
2021
$8,297
2020
$7,442
2,195
1,714
82
96
4,087
(11)
—
4,221
(62)
119
—
4,164
901
3,263
(239)
2,094
1,541
83
123
3,841
(16)
—
3,617
(31)
141
279
3,228
694
2,534
(195)
Net income attributable to S&P Global Inc.
$3,248
$3,024
$2,339
Earnings per share attributable to S&P Global Inc. common shareholders:
Net income:
Basic
Diluted
Weighted-average number of common shares outstanding:
Basic
Diluted
Actual shares outstanding at year end
See accompanying notes to the consolidated financial statements.
$10.25
$10.20
316.9
318.5
321.9
$12.56
$12.51
240.8
241.8
241.0
$9.71
$9.66
241.0
242.1
240.6
48 S&P Global 2022 Annual Report
(in millions, except per share data)
Revenue
Expenses:
Operating-related expenses
Selling and general expenses
Depreciation
Amortization of intangibles
Total expenses
Gain on dispositions
Operating profit
Other income, net
Interest expense, net
Loss on extinguishment of debt
Income before taxes on income
Provision for taxes on income
Net income
Equity in income on unconsolidated subsidiaries
Net income:
Basic
Diluted
Basic
Diluted
Weighted-average number of common shares outstanding:
Actual shares outstanding at year end
Year Ended December 31,
2022
$11,181
2021
$8,297
2020
$7,442
3,766
3,383
108
905
8,162
(1,898)
(27)
4,944
(70)
304
8
4,702
1,180
3,522
(274)
$10.25
$10.20
316.9
318.5
321.9
2,195
1,714
82
96
4,087
4,221
(11)
—
(62)
119
—
4,164
901
3,263
(239)
$12.56
$12.51
240.8
241.8
241.0
2,094
1,541
3,841
83
123
(16)
—
3,617
(31)
141
279
3,228
694
2,534
(195)
$9.71
$9.66
241.0
242.1
240.6
Less: net income attributable to noncontrolling interests
Net income attributable to S&P Global Inc.
$3,248
$3,024
$2,339
Earnings per share attributable to S&P Global Inc. common shareholders:
Consolidated Statements of Comprehensive Income
(in millions)
Net income
Other comprehensive income:
Foreign currency translation adjustments
Income tax effect
Pension and other postretirement benefit plans
Income tax effect
Unrealized gain (loss) on cash flow hedges
Income tax effect
Comprehensive income
Less: comprehensive income attributable to
nonredeemable noncontrolling interests
Less: comprehensive income attributable to
redeemable noncontrolling interests
Year Ended December 31,
2022
$3,522
2021
$3,263
2020
$2,534
(224)
(22)
(246)
(60)
16
(44)
325
(80)
245
3,477
(25)
11
(24)
(13)
33
(10)
23
(282)
68
(214)
3,059
(24)
(24)
22
(2)
(31)
8
(23)
17
(5)
12
2,521
(14)
(249)
(215)
(181)
Comprehensive income attributable to S&P Global Inc.
$3,203
$2,820
$2,326
See accompanying notes to the consolidated financial statements.
S&P Global 2022 Annual Report 49
Consolidated Balance Sheets
(in millions)
ASSETS
Current assets:
Cash and cash equivalents
Restricted cash
Short-term investments
Accounts receivable, net of allowance for doubtful accounts: 2022- $48 ; 2021 - $26
Prepaid and other current assets
Assets of business held for sale
Total current assets
Property and equipment:
Buildings and leasehold improvements
Equipment and furniture
Total property and equipment
Less: accumulated depreciation
Property and equipment, net
Right of use assets
Goodwill
Other intangible assets, net
Equity investments in unconsolidated subsidiaries
Asset for pension benefits
Other non-current assets
Total assets
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
Accrued compensation and contributions to retirement plans
Short-term debt
Income taxes currently payable
Unearned revenue
Other current liabilities
Liabilities of business held for sale
Total current liabilities
Long-term debt
Lease liabilities – non-current
Pension and other postretirement benefits
Deferred tax liability – non-current
Other non-current liabilities
Total liabilities
Redeemable noncontrolling interest
Commitments and contingencies (Note 13)
Equity:
Common stock, $1 par value: authorized - 600 million shares; issued:
2022 - 415 million shares; 2021 - 294 million shares
Additional paid-in capital
Retained income
Accumulated other comprehensive loss
Less: common stock in treasury - at cost: 2022 - 86 million shares; 2021 - 53 million shares
Total equity – controlling interests
Total equity – noncontrolling interests
Total equity
Total liabilities and equity
50 S&P Global 2022 Annual Report
December 31,
2022
2021
$1,286
1
14
2,494
574
1,298
5,667
468
688
1,156
(859)
297
423
34,545
18,306
1,752
232
562
$61,784
$450
753
226
116
3,126
1,094
234
5,999
10,730
577
180
4,065
489
22,040
3,267
$6,497
8
11
1,650
323
321
8,810
346
515
861
(620)
241
426
3,506
1,285
165
359
234
$15,026
$205
607
—
90
2,217
547
149
3,815
4,114
492
262
147
660
9,490
3,429
415
294
44,422
17,784
(886)
(25,347)
36,388
89
36,477
$61,784
1,031
15,017
(841)
(13,469)
2,032
75
2,107
$15,026
See accompanying notes to the consolidated financial statements.
Consolidated Statements of Cash Flows
(in millions)
Operating Activities:
Net income
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation
Amortization of intangibles
Provision for losses on accounts receivable
Deferred income taxes
Stock-based compensation
Gain on dispositions
Loss on extinguishment of debt, net
Lease impairment charges
Other
Changes in operating assets and liabilities, net of effect of acquisitions and dispositions:
Accounts receivable
Prepaid and other current assets
Accounts payable and accrued expenses
Unearned revenue
Other current liabilities
Net change in prepaid/accrued income taxes
Net change in other assets and liabilities
Cash provided by operating activities
Investing Activities:
Capital expenditures
Acquisitions, net of cash acquired
Proceeds from dispositions
Changes in short-term investments
Cash provided by (used for) investing activities
Financing Activities:
Payments on short-term debt, net
Proceeds from issuance of senior notes, net
Payments on senior notes
Dividends paid to shareholders
Distributions to noncontrolling interest holders
Proceeds from noncontrolling interest holders
Repurchase of treasury shares
Exercise of stock options
Employee withholding tax on share-based payments
Cash used for financing activities
Effect of exchange rate changes on cash
Net change in cash, cash equivalents, and restricted cash
Cash, cash equivalents, and restricted cash at beginning of year
Cash, cash equivalents, and restricted cash at end of year
Cash paid during the year for:
Interest
Income taxes
See accompanying notes to the consolidated financial statements.
Year Ended December 31,
2022
2021
2020
$3,522
$3,263
$2,534
108
905
24
(353)
214
(1,898)
8
132
15
36
(123)
43
37
(2)
(135)
70
82
96
14
13
122
(11)
—
31
58
(144)
(86)
38
198
(45)
(36)
5
83
123
17
(31)
90
(16)
279
120
121
18
(85)
132
220
(15)
(2)
(21)
2,603
3,598
3,567
(89)
210
3,509
(2)
3,628
(32)
5,395
(3,698)
(1,024)
(270)
410
(12,004)
7
(110)
(11,326)
(123)
(5,218)
6,505
$1,287
$240
$1,555
(35)
(99)
16
(2)
(120)
—
—
—
(743)
(227)
—
—
13
(56)
(1,013)
(82)
2,383
4,122
$6,505
$130
$883
(76)
(201)
18
19
(240)
—
1,276
(1,394)
(645)
(194)
—
(1,164)
16
(61)
(2,166)
75
1,236
2,886
$4,122
$159
$683
S&P Global 2022 Annual Report 51
Consolidated Statements of Equity
(in millions)
Common
Stock
$1 par
Additional
Paid-in
Capital
Retained
Income
Accumulated
Other
Comprehensive
Loss
Less:
Treasury
Stock
Total
SPGI
Equity
Non-
controlling
Interests
Balance as of December 31, 2019
$294
$903
$12,205
$(624)
$12,299
Comprehensive income ¹
Dividends (Dividend declared per
common share — $2.68 per share)
Share repurchases
Employee stock plans
Change in redemption value of
redeemable noncontrolling interest
Other
2,339
(645)
(532)
43
(13)
1,164
(2)
Balance as of December 31, 2020
$294
$946
$13,367
$(637)
$13,461
Comprehensive income 1
Dividends (Dividend declared per
common share — $3.08 per share)
Employee stock plans
Change in redemption value of
redeemable noncontrolling interest
Other
3,024
(743)
(631)
85
(204)
8
$479
2,326
(645)
(1,164)
45
(532)
—
$509
2,820
(743)
77
(631)
—
$57
14
(11)
2
$62
24
(13)
Total
Equity
$536
2,340
(656)
(1,164)
45
(532)
2
$571
2,844
(756)
77
(631)
2
2
Balance as of December 31, 2021
$294
$1,031
$15,017
(841)
$13,469
$2,032
$75
$2,107
Comprehensive income 1
Dividends (Dividend declared per
common share — $3.32 per share)
3,248
(1,024)
(45)
Acquisition of IHS Markit
121
43,415
Share repurchases
Employee stock plans
Change in redemption value of
redeemable noncontrolling interest
Adjustment to noncontrolling
interest
Other
(125)
114
(13)
545
(2)
3,203
(1,024)
43,536
11,878
(12,003)
114
545
(13)
(2)
25
3,228
(15)
(1,039)
43,536
(12,003)
114
545
(13)
2
4
Balance as of December 31, 2022
$415
$44,422
$17,784
(886)
$25,347
$36,388
$89
$36,477
1
Excludes $249 million, $215 million and $181 million in 2022, 2021 and 2020, respectively, attributable to redeemable noncontrolling interest.
See accompanying notes to the consolidated financial statements.
52 S&P Global 2022 Annual Report
Notes to the Consolidated Financial Statements
1. Accounting Policies
Nature of operations
S&P Global Inc. (together with its consolidated subsidiaries, the
“Company,” the “Registrant,” “we,” “us” or “our”) is a provider of
credit ratings, benchmarks, analytics and workflow solutions
in the global capital, commodity, automotive and engineering
markets. The capital markets include asset managers,
investment banks, commercial banks, insurance companies,
exchanges, trading firms and issuers; the commodity markets
include producers, traders and intermediaries within energy,
petrochemicals, metals & steel and agriculture; the automotive
markets include manufacturers, suppliers, dealerships and
service shops; and the engineering markets include engineers,
builders, and architects.
Our operations consist of six reportable segments: S&P Global
Market Intelligence (“Market Intelligence”), S&P Global Ratings
(“Ratings”), S&P Global Commodity Insights (“Commodity
Insights”), S&P Global Mobility (“Mobility”), S&P Dow Jones
Indices (“Indices”) and S&P Global Engineering Solutions
(“Engineering Solutions”).
– Market Intelligence is a global provider of multi-asset-
class data and analytics integrated with purpose-built
workflow solutions.
– Ratings is an independent provider of credit ratings,
research, and analytics, offering investors and other market
participants information, ratings and benchmarks.
– Commodity Insights is a leading independent provider of
information and benchmark prices for the commodity and
energy markets.
– Mobility is a leading provider of solutions serving the full
automotive value chain including vehicle manufacturers
(OEMs), automotive suppliers, mobility service providers,
retailers, consumers, and finance and insurance companies.
– Indices is a global index provider that maintains a wide variety
of valuation and index benchmarks for investment advisors,
wealth managers and institutional investors.
– Engineering Solutions is a leading provider of engineering
standards and related technical knowledge.
On February 28, 2022, we completed the merger with IHS
Markit Ltd (“IHS Markit”) by acquiring 100% of the IHS Markit
common stock that was issued and outstanding as of the date
of acquisition, and as a result, IHS Markit and its subsidiaries
became wholly owned consolidated subsidiaries of S&P Global,
and the consolidated financial statements as of and for the
year ended December 31, 2022 include the financial results
of IHS Markit from the date of acquisition. The merger with
IHS Markit, a world leader in critical information, analytics,
and solutions for the major industries and markets that drive
economies, brings together two world-class organizations with
leading brands and capabilities across information services that
will be uniquely positioned to serve, facilitate and power the
markets of the future.
Revenue Recognition
Under ASC 606, revenue is recognized when a customer obtains
control of promised goods or services in an amount that reflects
the consideration the entity expects to receive in exchange for
those goods or services.
Subscription revenue
Subscription revenue at Market Intelligence is primarily derived
from distribution of data, valuation services, analytics, third
party research, and credit ratings-related information through
both feed and web-based channels. Subscription revenue at
Market Intelligence also includes software and hosted product
offerings which provide maintenance and continuous access to
our platforms over the contract term. Subscription revenue at
Commodity Insights is primarily from subscriptions to our market
data and market insights (price assessments, market reports
and commentary and analytics) along with other information
products and software term licenses. Subscription revenue at
Mobility is primarily derived from products that provide data
and insight on future vehicles sales and production, including
detailed forecasts on technology and vehicle components;
supply car makers and dealers with market reporting products,
predictive analytics and marketing automation software; and
support dealers with vehicle history reports, used car listings
and service retention solutions. Subscription revenue at Mobility
also include a range of services to financial institutions, to
support their marketing, insurance underwriting and claims
management activities. Subscription revenue at Indices is
derived from the contracts for underlying data of our indexes to
support our customers’ management of index funds, portfolio
analytics, and research. Subscription revenue at Engineering
Solutions is primarily from subscriptions to our Product Design
offerings providing standards, codes and specifications;
applied technical reference; engineering journals, reports, best
practices, and other vetted technical reference; and patents and
patent applications.
For subscription products and services, we generally provide
continuous access to dynamic data sets and analytics for
a defined period, with revenue recognized ratably as our
performance obligation to provide access to our data and
analytics is progressively fulfilled over the stated term
of the contract.
Non-transaction revenue
Non-transaction revenue at Ratings primarily includes fees
for surveillance of a credit rating, annual fees for customer
relationship-based pricing programs, fees for entity credit
ratings and global research and analytics at CRISIL. Non-
transaction revenue also includes an intersegment revenue
elimination of $169 million, $146 million and $137 million
for the years ended December 31, 2022, 2021, and 2020
respectively, mainly consisting of the royalty charged to Market
Intelligence for the rights to use and distribute content and data
developed by Ratings.
For non-transaction revenue related to Rating’s surveillance
services, we continuously monitor factors that impact the
S&P Global 2022 Annual Report 53
creditworthiness of an issuer over the contractual term with
revenue recognized to the extent that our performance obligation
is progressively fulfilled over the term contract. Because
surveillance services are continuously provided throughout
the term of the contract, our measure of progress towards
fulfillment of our obligation to monitor a rating is a time-based
output measure with revenue recognized ratably over the term
of the contract.
Non-subscription / Transaction revenue
Transaction revenue at our Ratings segment primarily includes
fees associated with:
– ratings related to new issuance of corporate and
government debt instruments; as well as structured finance
instruments; and
– bank loan ratings.
Transaction revenue is recognized at the point in time when our
performance obligation is satisfied by issuing a rating on our
customer’s instruments and when we have a right to payment
and the customer can benefit from the significant risks and
rewards of ownership.
Non-subscription revenue at Market Intelligence is primarily
related to certain advisory, pricing conferences and events, and
analytical services. Non-subscription revenue at Mobility include
one-time transactional sales of data that are non-cyclical
in nature — and that are usually tied to underlying business
metrics such as vehicle manufacturers marketing spend or
safety recall activity — as well as consulting and advisory
services. Non-subscription revenue at Commodity Insights
is primarily related to conference sponsorship, consulting
engagements, events, and perpetual software licenses. Non-
subscription revenue at Engineering Solutions is primarily from
retail transaction and consulting services.
Asset-linked fees
Asset-linked fees at Indices are primarily related to royalties
payments based on the value of assets under management in
our customers exchange-traded funds and mutual funds.
For asset-linked products and services, we provide licenses
conveying continuous access to our index and benchmark-
related intellectual property during a specified contract term.
Revenue is recognized when the extent that our customers
have used our licensed intellectual property can be quantified.
Recognition of revenue for our asset-linked fee arrangements is
subject to the “recognition constraint” for usage-based royalty
payments because we cannot reasonably predict the value of
the assets that will be invested in index funds structured using
our intellectual property until it is either publicly available or
when we are notified by our customers. Revenue derived from an
asset-linked fee arrangement is measured and recognized when
the certainty of the extent of its utilization of our index products
by our customers is known.
Sales usage-based royalties
Sales usage-based royalty revenue at our Indices segment is
primarily related to trading based fees from exchange-traded
derivatives. Sales and usage-based royalty revenue at our
Commodity Insights segment is primarily related to licensing
of its proprietary market price data and price assessments to
commodity exchanges.
For sales usage-based royalty products and services, we
provide licenses conveying the right to continuous access to
our intellectual property over the contract term, with revenue
recognized when the extent of our license’s utilization can be
quantified, or more specifically, when trading volumes are known
and publicly available to us or when we are notified by our
customers. Recognition of revenue of fees tied to trading volumes
is subject to the recognition constraint for a usage-based royalty
promised by our customers in exchange for the license of our
intellectual property, with revenue recognized when trading
volumes are known.
Recurring variable revenue
Recurring variable revenue at Market Intelligence represents
revenue from contracts for services that specify a fee based on,
among other factors, the number of trades processed, assets
under management, or the number of positions valued.
Arrangements with Multiple Performance Obligations
Our contracts with customers may include multiple performance
obligations. Revenue relating to agreements that provide for
more than one performance obligation is recognized based upon
the relative fair value to the customer of each service component
as each component is earned. The fair value of the service
components are determined using an analysis that considers
cash consideration that would be received for instances when
the service components are sold separately. If the fair value to
the customer for each service is not objectively determinable, we
make our best estimate of the services’ stand-alone selling price
and record revenue as it is earned over the service period.
Receivables
We record a receivable when a customer is billed or when
revenue is recognized prior to billing a customer. For multi-year
agreements, we generally invoice customers annually at the
beginning of each annual period.
Contract Assets
Contract assets include unbilled amounts from when the
Company transfers service to a customer before a customer
pays consideration or before payment is due. As of December 31,
2022 and 2021, contract assets were $60 million and $9 million,
respectively, and are included in accounts receivable in our
consolidated balance sheets.
Unearned Revenue
We record unearned revenue when cash payments are received
in advance of our performance. The increase in the unearned
revenue balance for the year ended December 31, 2022 is
primarily driven by cash payments received in advance of
satisfying our performance obligations, offset by $1.5 billion of
revenues recognized that were included in the unearned revenue
balance at the beginning of the period.
54 S&P Global 2022 Annual Report
Remaining Performance Obligations
Remaining performance obligations represent the transaction
price of contracts for work that has not yet been performed. As
of December 31, 2022, the aggregate amount of the transaction
price allocated to remaining performance obligations was $4.2
billion. We expect to recognize revenue on approximately half
and three-quarters of the remaining performance obligations
over the next 12 and 24 months, respectively, with the remainder
recognized thereafter.
We do not disclose the value of unfulfilled performance
obligations for (i) contracts with an original expected length
of one year or less and (ii) contracts where revenue is a
usage-based royalty promised in exchange for a license of
intellectual property.
Costs to Obtain a Contract
We recognize an asset for the incremental costs of obtaining
a contract with a customer if we expect the benefit of those
costs to be longer than one year. We have determined that the
costs associated with certain sales commission programs are
incremental to the costs to obtain contracts with customers and
therefore meet the criteria to be capitalized. Total capitalized
costs to obtain a contract were $175 million and $137 million
as of December 31, 2022 and December 31, 2021, respectively,
and are included in prepaid and other current assets and other
non-current assets on our consolidated balance sheets. The
capitalized asset will be amortized over a period consistent
with the transfer to the customer of the goods or services to
which the asset relates, calculated based on the customer term
and the average life of the products and services underlying
the contracts which has been determined to be approximately
5 years. The expense is recorded within selling and general
expenses in the consolidated statements of income.
We expense sales commissions when incurred if the
amortization period would have been one year or less. These
costs are recorded within selling and general expenses.
Equity in Income on Unconsolidated Subsidiaries
The Company holds an investment in a 50/50 joint venture
arrangement with shared control with CME Group that combined
each of the company’s post-trade services into a new joint
venture, OSTTRA. The joint venture provides trade processing
and risk mitigation operations and incorporates CME Group’s
optimization businesses (Traiana, TriOptima, and Reset) and the
Company’s MarkitSERV business. The combination is intended to
increase operating efficiencies of both the company’s business
to more effectively service clients with enhanced platforms and
services for OTC markets across interest rate, FX, equity, and
credit asset classes.
Other Income, net
The components of other income, net for the years ended
December 31 are as follows:
(in millions)
2022
2021
2020
Other components of net
periodic benefit cost
Net (gain) loss from
investments
Other income, net
$(11)
$(45)
$(32)
(59)
(17)
1
$(70)
$(62)
$(31)
Assets and Liabilities Held for Sale
and Discontinued Operations
Assets and Liabilities Held for Sale
We classify a disposal group to be sold as held for sale in the
period in which all of the following criteria are met: management,
having the authority to approve the action, commits to a plan
to sell the disposal group; the disposal group is available for
immediate sale in its present condition subject only to terms
that are usual and customary for sales of such disposal group;
an active program to locate a buyer and other actions required
to complete the plan to sell the disposal group have been
initiated; the sale of the disposal group is probable, and transfer
of the disposal group is expected to qualify for recognition as a
completed sale within one year, except if events or circumstances
beyond our control extend the period of time required to sell
the disposal group beyond one year; the disposal group is being
actively marketed for sale at a price that is reasonable in relation
to its current fair value; and actions required to complete the
plan indicate that it is unlikely that significant changes to the
plan will be made or that the plan will be withdrawn.
A disposal group that is classified as held for sale is initially
measured at the lower of its carrying value or fair value less
any costs to sell. Any loss resulting from this measurement
is recognized in the period in which the held for sale criteria
are met. Conversely, gains are not recognized on the sale of a
disposal group until the date of sale.
The fair value of a disposal group less any costs to sell is
assessed each reporting period it remains classified as held for
sale and any subsequent changes are reported as an adjustment
to the carrying value of the disposal group, as long as the new
carrying value does not exceed the carrying value of the disposal
group at the time it was initially classified as held for sale.
Upon determining that a disposal group meets the criteria to be
classified as held for sale, the Company reports the assets and
liabilities of the disposal group as held for sale in the current
period in our consolidated balance sheets.
S&P Global 2022 Annual Report 55
Discontinued Operations
In determining whether a disposal of a component of an entity or
a group of components of an entity is required to be presented
as a discontinued operation, we make a determination whether
the disposal represents a strategic shift that had, or will
have, a major effect on our operations and financial results. A
component of an entity comprises operations and cash flows
that can be clearly distinguished both operationally and for
financial reporting purposes. If we conclude that the disposal
represents a strategic shift, then the results of operations of
the group of assets being disposed of (as well as any gain or
loss on the disposal transaction) are aggregated for separate
presentation apart from our continuing operating results in the
consolidated financial statements.
Principles of consolidation
The consolidated financial statements include the accounts
of all subsidiaries and our share of earnings or losses of joint
ventures and affiliated companies under the equity method
of accounting. All significant intercompany accounts and
transactions have been eliminated.
Use of estimates
The preparation of financial statements in conformity with
generally accepted accounting principles in the United States
of America requires management to make estimates and
assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ
from those estimates.
Cash and cash equivalents
Cash and cash equivalents include ordinary bank deposits
and highly liquid investments with original maturities of three
months or less that consist primarily of money market funds
with unrestricted daily liquidity and fixed term time deposits.
Such investments and bank deposits are stated at cost, which
approximates market value, and were $1.3 billion and $6.5
billion as of December 31, 2022 and 2021, respectively. These
investments are not subject to significant market risk.
Restricted cash
Cash that is subject to legal restrictions or is unavailable for
general operating purposes is classified as restricted cash.
Restricted cash included in our consolidated balance sheets was
$1 million and $8 million as of December 31, 2022 and December
31, 2021, respectively.
Short-term investments
Short-term investments are securities with original maturities
greater than 90 days that are available for use in our operations
in the next twelve months. The short-term investments, primarily
consisting of certificates of deposit and mutual funds, are
carried at fair value, which is estimated based on the net asset
value of these investments. Interest and dividends are recorded
in income when earned.
Accounts receivable
Credit is extended to customers based upon an evaluation
of the customer’s financial condition. Accounts receivable,
which include billings consistent with terms of contractual
arrangements, are recorded at net realizable value
Allowance for doubtful accounts
The allowance for doubtful accounts reserve methodology
is based on historical analysis, a review of outstanding
balances and current conditions, and by incorporating data
points that provide indicators of future economic conditions
including forecasted industry default rates and industry index
benchmarks. In determining these reserves, we consider,
amongst other factors, the financial condition and risk profile of
our customers, areas of specific or concentrated risk as well as
applicable industry trends or market indicators.
Capitalized technology costs
We capitalize certain software development and website
implementation costs. Capitalized costs only include
incremental, direct costs of materials and services incurred
to develop the software after the preliminary project stage is
completed, funding has been committed and it is probable that
the project will be completed and used to perform the function
intended. Incremental costs are expenditures that are out-of-
pocket to us and are not part of an allocation or existing expense
base. Software development and website implementation costs
are expensed as incurred during the preliminary project stage.
Capitalized costs are amortized from the year the software is
ready for its intended use over its estimated useful life, three
to seven years, using the straight-line method. Periodically,
we evaluate the amortization methods, remaining lives and
recoverability of such costs. Capitalized software development
and website implementation costs are included in other
non-current assets and are presented net of accumulated
amortization. Gross capitalized technology costs were $259
million and $216 million as of December 31, 2022 and 2021,
respectively. Accumulated amortization of capitalized technology
costs was $190 million and $173 million as of December 31, 2022
and 2021, respectively.
56 S&P Global 2022 Annual Report
Fair Value
Certain assets and liabilities are required to be recorded at fair
value and classified within a fair value hierarchy based on inputs
used when measuring fair value. We have foreign exchange
forward contracts, cross currency and interest rate swaps that
are adjusted to fair value on a recurring basis.
Other financial instruments, including cash and cash equivalents
and short-term investments, are recorded at cost, which
approximates fair value because of the short-term maturity and
highly liquid nature of these instruments. The fair value of our
long-term debt borrowings were $9.3 billion and $4.4 billion as
of December 31, 2022 and 2021, respectively, and was estimated
based on quoted market prices.
Accounting for the impairment of long-lived
assets (including other intangible assets)
We evaluate long-lived assets for impairment whenever events
or changes in circumstances indicate that the carrying amount
of an asset may not be recoverable. Upon such an occurrence,
recoverability of assets to be held and used is measured by
comparing the carrying amount of an asset to current forecasts
of undiscounted future net cash flows expected to be generated
by the asset. If the carrying amount of the asset exceeds its
estimated future cash flows, an impairment charge is recognized
equal to the amount by which the carrying amount of the asset
exceeds the fair value of the asset. For long-lived assets held for
sale, assets are written down to fair value, less cost to sell. Fair
value is determined based on market evidence, discounted cash
flows, appraised values or management’s estimates, depending
upon the nature of the assets.
Leases
We determine whether an arrangement meets the criteria for
an operating lease or a finance lease at the inception of the
arrangement. We have operating leases for office space and
equipment. Our leases have remaining lease terms of 1 year to 11
years, some of which include options to extend the leases for up
to 14 years, and some of which include options to terminate the
leases within 1 year. We consider these options in determining
the lease term used to establish our right-of use (“ROU”) assets
and associated lease liabilities. We sublease certain real estate
leases to third parties which mainly consist of operating leases
for space within our offices.
Leases with an initial term of 12 months or less are not recorded
on the balance sheet; we recognize lease expenses for these
leases on a straight line-basis over the lease term in operating-
related expenses and selling and general expenses.
payments over the lease term at commencement date. Our future
minimum based payments used to determine our lease liabilities
include minimum based rent payments and escalations. As
most of our leases do not provide an implicit rate, we use our
estimated incremental borrowing rate based on the information
available at commencement date in determining the present
value of lease payments.
Goodwill and other indefinite-lived intangible assets
Goodwill represents the excess of purchase price and related
costs over the value assigned to the net tangible and identifiable
intangible assets of businesses acquired. Goodwill and other
intangible assets with indefinite lives are not amortized, but
instead are tested for impairment annually during the fourth
quarter each year, or more frequently if events or changes
in circumstances indicate that the asset might be impaired.
We have six reporting units with goodwill that are evaluated
for impairment.
We initially perform a qualitative analysis evaluating whether
any events and circumstances occurred or exist that provide
evidence that it is more likely than not that the fair value of any
of our reporting units is less than its carrying amount. If, based
on our evaluation we do not believe that it is more likely than not
that the fair value of any of our reporting units is less than its
carrying amount, no quantitative impairment test is performed.
Conversely, if the results of our qualitative assessment
determine that it is more likely than not that the fair value of
any of our reporting units is less than their respective carrying
amounts we perform a quantitative impairment test.
When conducting our impairment test to evaluate the
recoverability of goodwill at the reporting unit level, the
estimated fair value of the reporting unit is compared to its
carrying value including goodwill. Fair value of the reporting units
are estimated using the income approach, which incorporates
the use of the discounted free cash flow (“DCF”) analyses and are
corroborated using the market approach, which incorporates the
use of revenue and earnings multiples based on market data. The
DCF analyses are based on the current operating budgets and
estimated long-term growth projections for each reporting unit.
Future cash flows are discounted based on a market comparable
weighted average cost of capital rate for each reporting unit,
adjusted for market and other risks where appropriate. In
addition, we analyze any difference between the sum of the fair
values of the reporting units and our total market capitalization
for reasonableness, taking into account certain factors including
control premiums. If the fair value of the reporting unit is less
than the carrying value, the difference is recognized as an
impairment charge.
Operating lease ROU assets and operating lease liabilities are
recognized based on the present value of future minimum lease
We evaluate the recoverability of indefinite-lived intangible
assets by first performing a qualitative analysis evaluating
S&P Global 2022 Annual Report 57
whether any events and circumstances occurred that provide
evidence that it is more likely than not that the indefinite-lived
asset is impaired. If, based on our evaluation of the events and
circumstances that occurred during the year we do not believe
that it is more likely than not that the indefinite-lived asset
is impaired, no quantitative impairment test is performed.
Conversely, if the results of our qualitative assessment
determine that it is more likely than not that the indefinite-lived
asset is impaired, a quantitative impairment test is performed.
If necessary, an impairment analysis is performed using the
income approach to estimate the fair value of the indefinite-lived
intangible asset. If the intangible asset carrying value exceeds
its fair value, an impairment charge is recognized in an amount
equal to that excess.
Significant judgments inherent in these analyses include
estimating the amount and timing of future cash flows and
the selection of appropriate discount rates, royalty rates and
long-term growth rate assumptions. Changes in these estimates
and assumptions could materially affect the determination of
fair value for each reporting unit and indefinite-lived intangible
asset and could result in an impairment charge, which could be
material to our financial position and results of operations.
We performed our impairment assessment of goodwill
and indefinite-lived intangible assets and concluded that
no impairment existed for the years ended December 31,
2022, 2021 and 2020.
Foreign currency translation
We have operations in many foreign countries. For most
international operations, the local currency is the functional
currency. For international operations that are determined to
be extensions of the parent company, the United States (“U.S.”)
dollar is the functional currency. For local currency operations,
assets and liabilities are translated into U.S. dollars using end of
period exchange rates, and revenue and expenses are translated
into U.S. dollars using weighted-average exchange rates. Foreign
currency translation adjustments are accumulated in a separate
component of equity.
Depreciation
The costs of property and equipment are depreciated using
the straight-line method based upon the following estimated
useful lives: buildings and improvements from 15 to 40 years
and equipment and furniture from 2 to 10 years. The costs of
leasehold improvements are amortized over the lesser of the
useful lives or the terms of the respective leases.
Advertising expense
The cost of advertising is expensed as incurred. We incurred
$177 million, $39 million and $29 million in advertising costs for
the years ended December 31, 2022, 2021 and 2020, respectively.
Stock-based compensation
Stock-based compensation expense is measured at the grant
date based on the fair value of the award and is recognized over
the requisite service period, which typically is the vesting period.
Stock-based compensation is classified as both operating-
related expense and selling and general expense in the
consolidated statements of income.
Income taxes
Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between financial
statement carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets and liabilities
are measured using enacted tax rates expected to be applied to
taxable income in the years in which those temporary differences
are expected to be recovered or settled. We recognize liabilities
for uncertain tax positions taken or expected to be taken in
income tax returns. Accrued interest and penalties related to
unrecognized tax benefits are recognized in interest expense and
operating expense, respectively.
Judgment is required in determining our provision for income
taxes, deferred tax assets and liabilities and unrecognized tax
benefits. In determining the need for a valuation allowance, the
historical and projected financial performance of the operation
that is recording a net deferred tax asset is considered along
with any other pertinent information.
We file income tax returns in the U.S. federal jurisdiction and
various state and foreign jurisdictions, and we are routinely
under audit by many different tax authorities. We believe that
our accrual for tax liabilities is adequate for all open audit
years based on an assessment of many factors including past
experience and interpretations of tax law. This assessment
relies on estimates and assumptions and may involve a series
of complex judgments about future events. It is possible that
tax examinations will be settled prior to December 31, 2023. If
any of these tax audit settlements do occur within that period
we would make any necessary adjustments to the accrual for
unrecognized tax benefits.
As of December 31, 2022, we have approximately $10.1 billion of
undistributed earnings of our foreign subsidiaries, of which $4.1
billion is reinvested indefinitely in our foreign operations.
Redeemable Noncontrolling Interest
The agreement with the minority partners of our S&P Dow Jones
Indices LLC joint venture contains redemption features whereby
interests held by our minority partners are redeemable either (i)
at the option of the holder or (ii) upon the occurrence of an event
that is not solely within our control. Since redemption of the
noncontrolling interest is outside of our control, this interest is
presented on our consolidated balance sheets under the caption
“Redeemable noncontrolling interest.” If the interest were to
be redeemed, we would generally be required to purchase the
interest at fair value on the date of redemption. We adjust the
redeemable noncontrolling interest each reporting period to its
estimated redemption value, but never less than its initial fair
value, using both income and market valuation approaches.
Our income and market valuation approaches incorporate
Level 3 measures for instances when observable inputs are
not available. The more significant judgmental assumptions
58 S&P Global 2022 Annual Report
used to estimate the value of the S&P Dow Jones Indices LLC
joint venture include an estimated discount rate, a range of
assumptions that form the basis of the expected future net cash
flows (e.g., the revenue growth rates and operating margins),
and a company specific beta. The significant judgmental
assumptions used that incorporate market data, including the
relative weighting of market observable information and the
comparability of that information in our valuation models, are
forward-looking and could be affected by future economic and
market conditions. Any adjustments to the redemption value will
impact retained income. See Note 9 – Equity for further detail.
Contingencies
We accrue for loss contingencies when both (a) information
available prior to issuance of the consolidated financial
statements indicates that it is probable that a liability had been
incurred at the date of the financial statements and (b) the
amount of loss can reasonably be estimated. We continually
assess the likelihood of any adverse judgments or outcomes
to our contingencies, as well as potential amounts or ranges
of probable losses, and recognize a liability, if any, for these
contingencies based on an analysis of each matter with the
assistance of outside legal counsel and, if applicable, other
experts. Because many of these matters are resolved over long
periods of time, our estimate of liabilities may change due to
new developments, changes in assumptions or changes in
our strategy related to the matter. When we accrue for loss
contingencies and the reasonable estimate of the loss is within a
range, we record our best estimate within the range. We disclose
an estimated possible loss or a range of loss when it is at least
reasonably possible that a loss may be incurred.
Recent Accounting Standards
In March of 2020, the Financial Accounting Standards Board
(“FASB”) issued accounting guidance to provide temporary
optional expedients and exceptions to the current contract
modifications and hedge accounting guidance in light of the
expected market transition from London Interbank Offered
Rate (“LIBOR”) to alternative rates. The new guidance provides
optional expedients and exceptions to transactions affected
by reference rate reform if certain criteria are met. The
transactions primarily include (1) contract modifications, (2)
hedging relationships, and (3) sale or transfer of debt securities
classified as held-to-maturity. In December of 2022, the FASB
amended its guidance to defer the sunset date from December
31, 2022 to December 31, 2024. The Company may elect to adopt
the amendments prospectively to transactions existing as of or
entered into from the date of adoption through December 31,
2024. We do not expect this guidance to have a significant impact
on our consolidated financial statements.
Reclassification
Certain prior year amounts have been reclassified for
comparability purposes.
S&P Global 2022 Annual Report 59
2. Acquisitions and Divestitures
ACQUISITIONS
2023
On January 3, 2023, we completed the acquisition of ChartIQ,
a premier charting provider for the financial services industry.
ChartIQ is a professional grade charting solution that allows
users to visualize data with a fully interactive web-based
library that works seamlessly across web, mobile and desktop.
It provides advanced capabilities including trade visualization,
options analytics, technical analysis and more. Additionally,
ChartIQ allows clients to visualize vendor-supplied data
combined with their own proprietary content, alternative
datasets or analytics. The acquisition will be part of our Market
Intelligence segment and further enhance our S&P Capital IQ
Pro platform, our digital investment solutions provider Markit
Digital and other workflow solutions to provide the industry with
leading visualization capabilities. The acquisition of ChartIQ is
not material to our consolidated financial statements.
On January 4, 2023, we completed the acquisition of TruSight
Solutions LLC (“TruSight”) a provider of third-party vendor
risk assessments. The acquisition will be integrated into our
Market Intelligence segment and further expand the breadth
and depth of S&P Global’s third party vendor risk management
solutions by offering high-quality validated assessment data
to clients designed to reduce further the vendor due diligence
burden on service providers to the financial services industry.
The acquisition of TruSight is not material to our consolidated
financial statements.
2022
On December 1, 2022, we completed the acquisition of the
Shades of Green business from the Center for International
Climate Research (“CICERO”), Norway’s foremost institute
for interdisciplinary climate research. The acquisition will be
integrated into S&P Global Ratings and further expand the
breadth and depth of its second party opinions (SPOs) offering.
SPOs are independent assessments of a company’s financing
or framework’s alignment with market standards and typically
provided before any borrowing is raised. The acquisition of the
Shades of Green business is not material to our consolidated
financial statements.
Merger with IHS Markit
On February 28, 2022, we completed the merger with IHS Markit
by acquiring 100% of the IHS Markit common stock that was
issued and outstanding as of the date of acquisition, and as a
result, IHS Markit and its subsidiaries became wholly owned
consolidated subsidiaries of S&P Global.
Upon completion of the merger with IHS Markit, IHS Markit
stockholders received 113.8 million shares of S&P Global’s
common stock, at an exchange ratio of 0.2838 S&P Global shares
for each share of IHS Markit common stock, with cash paid in lieu
of fractional shares. The Company also issued approximately 0.9
million replacement equity award shares for IHS Markit equity
awards that were assumed pursuant to the merger agreement.
The estimated fair value of the consideration transferred for IHS
Markit was approximately $43.5 billion as of the merger date,
which consisted of the following:
(in millions, except for share and per
share data)
February 28, 2022
Number of shares IHS Markit issued
and outstanding*
Exchange ratio
Number of S&P Global common stock
transferred to IHS Markit stockholders
Closing price per share of S&P Global
common stock**
Fair value of S&P Global common stock
transferred IHS Markit stockholders
Fair value of S&P Global replacement equity
awards attributable to pre-combination
service
Total equity consideration
400,988,207
0.2838
113,800,453
$380.89
$43,345
$191
$43,536
*
Excludes 25,219,470 IHS Markit shares held by the Markit Group Holdings
Limited Employee Benefit Trust (“EBT”). The shares held by the EBT were
converted in the merger into S&P Global shares at the exchange ratio of
0.2838 and will continue to be held by the trustee in the EBT.
** Based on S&P Global’s closing stock price on February 25, 2022.
60 S&P Global 2022 Annual Report
Preliminary Allocation of Purchase Price
The merger with IHS Markit was accounted for as a business
combination using the acquisition method of accounting in
accordance with ASC 805, Business Combinations (“ASC 805”).
The purchase price was allocated to the assets acquired and
liabilities assumed based on the estimated fair values at the
date of acquisition. The excess of the purchase price over the
fair value of the net assets acquired was allocated to goodwill, of
which $699 million is expected to be deductible for tax purposes.
Goodwill is primarily attributed to synergies from future expected
economic benefits, including enhanced revenue growth from
expanded capabilities and geographic presence as well as
substantial cost savings from duplicative overhead, streamlined
operations and enhanced operational efficiency. The December
31, 2022 consolidated balance sheet includes the assets and
liabilities of IHS Markit, which have been measured at fair value
as of the acquisition date. The preliminary allocation of purchase
price recorded for IHS Markit is as follows:
(in millions)
Assets acquired
Cash and cash equivalents
Accounts receivable, net
Prepaid and other current assets
Assets of businesses held for sale
Property and equipment
Right of use assets
Goodwill
Other intangible assets
Equity investments in unconsolidated
subsidiaries
Other non-current assets
Total assets acquired
Liabilities assumed
Accounts payable
Accrued compensation
Short-term debt
Unearned revenue
Other current liabilities
Liabilities of businesses held for sale
Long-term debt
Lease liabilities - non-current
Deferred tax liability - non-current
Other non-current liabilities
Total liabilities assumed
Total consideration transferred
February 28, 2022
$310
968
224
1,519
118
240
31,451
18,620
1,644
The above fair values of assets acquired and liabilities assumed
are preliminary and are based on the information that was
available as of the reporting date. The fair values of the assets
acquired and liabilities assumed, including the identifiable
assets acquired, have been preliminarily determined using
the income and cost approaches, and are partially based on
inputs that are unobservable. For intangible assets, these
inputs include forecasted future cash flows, revenue growth
rates, customer attrition rates and discount rates that
require judgement and are subject to change. Differences
between the preliminary estimates and final accounting
could occur, and those differences could be material.
The Company believes that the information provides a
reasonable basis for estimating the fair values of the
acquired assets and assumed liabilities, but the potential for
additional measurement period adjustments exists based
on the Company’s continuing review of matters related to the
acquisition. The primary areas that remain preliminary relate
to the fair values of intangible assets acquired, deferred
taxes and residual goodwill. The Company will complete the
purchase price allocation in the first quarter of 2023.
Acquired Identifiable Intangible Assets
The following table sets forth preliminary estimated fair values
of the components of the identifiable intangible assets acquired
and their estimated useful lives:
(in millions)
Customer relationships
Trade names and trademarks
Developed technology
54
Databases
Fair
Value
Weighted
Average
Useful Lives
$13,596
1,469
1,043
2,512
25 years
14 years
10 years
12 years
$55,148
Total Identified Intangible Assets
$18,620
21 years
$174
90
968
1,053
579
72
4,191
231
4,198
56
$11,612
$43,536
S&P Global 2022 Annual Report 61
Acquisition-Related Expensess
The Company incurred acquisition-related costs of $619 million
related to the IHS Markit merger for the year ended December
31, 2022, and $249 million for the year ended December 31, 2021,
respectively. These costs were included in selling and general
expenses within the Company’s consolidated statements of
income for the years ended December 31, 2022, and December
31, 2021, respectively.
Pro forma information
Since the acquisition date, the results of operations for IHS
Markit of $3.799 billion of revenue and $659 million of operating
profit for the year ended December 31, 2022, have been included
within the accompanying consolidated statements of income.
The following unaudited supplemental pro forma combined
financial information presents the Company’s results of
operations for the years ended December 31, 2022 and
December 31, 2021 as if the acquisition of IHS Markit had
occurred on January 1, 2021. The pro forma financial information
is presented for comparative purposes only and is not
necessarily indicative of the Company’s operating results that
may have actually occurred had the acquisition of IHS Markit
been completed on January 1, 2021. The pro forma results do
not include anticipated synergies or other expected benefits of
the acquisition.
(in millions)
Revenue
Net Income
Year ended December 31,
2022
2021
$11,842
$12,382
$3,533
$4,137
The unaudited pro forma financial information reflects pro
forma adjustments to present the combined pro forma results
of operations as if the acquisition had occurred on January 1,
2021 to give effect to certain events the Company believes to be
directly attributable to the acquisition.
2021
For the year ended December 31, 2021, we paid cash for
acquisitions of $210 million, net of cash acquired, funded with
cash from operations. None of our acquisitions were material
either individually or in the aggregate, including the pro forma
impact on earnings. Acquisitions completed during the year
ended December 31, 2021 included:
– In December of 2021, as part of our Sustainable1
investments, we completed the acquisition of The Climate
Service, Inc. (“TCS”), which has developed a climate risk
analytics platform assisting corporates, investors and
governments with assessing physical climate risks.
Sustainable1 is S&P Global’s single source of essential
sustainability intelligence, bringing together S&P Global’s
resources and full product suite of data, benchmarking,
analytics, evaluations and indices that provide customers
with a 360-degree view to help achieve their sustainability
goals. The acquisition added capabilities to S&P Global’s
leading portfolio of essential environmental, social, and
governance (“ESG”) insights and solutions for its customers.
Through this acquisition, S&P Global is able to offer its clients
even more transparent, robust and comprehensive climate
data, models and analytics. We accounted for the acquisition
using the purchase method of accounting. The acquisition of
The Climate Service, Inc. is not material to our consolidated
financial statements.
For acquisitions during 2021 that were accounted for using the
purchase method, the excess of the purchase price over the fair
value of the net assets acquired is allocated to goodwill and
other intangibles. The goodwill recognized on our acquisitions
is largely attributable to anticipated operational synergies and
growth opportunities as a result of the acquisition. The intangible
assets, excluding goodwill and indefinite-lived intangibles, are
being amortized over their anticipated useful lives between
3 and 5 years.
2020
For the year ended December 31, 2020, we paid cash for
acquisitions of $201 million, net of cash acquired, funded with
cash from operations. None of our acquisitions were material
either individually or in the aggregate, including the pro forma
impact on earnings. Acquisitions completed during the year
ended December 31, 2020 included:
– In February of 2020, CRISIL, included within our Ratings
segment, completed the acquisition of Greenwich Associates
LLC (“Greenwich”), a leading provider of proprietary
benchmarking data, analytics and qualitative, actionable
insights that helps financial services firms worldwide
measure and improve business performance. The acquisition
complemented CRISIL’s existing portfolio of products and
expanded offerings to new segments across financial
services including commercial banks and asset and wealth
managers. We accounted for this acquisition using the
purchase method of accounting. The acquisition of Greenwich
is not material to our consolidated financial statements.
– In January of 2020, we completed the acquisition of the
ESG Ratings Business from RobecoSAM, which includes the
widely followed SAM* Corporate Sustainability Assessment,
an annual evaluation of companies’ sustainability practices.
The acquisition bolstered our position as the premier
resource for ESG insights and product solutions for our
customers. Through this acquisition, we are able to offer our
customers even more transparent, robust and comprehensive
ESG solutions. We accounted for this acquisition using
the purchase method of accounting. The acquisition of the
ESG Ratings Business is not material to our consolidated
financial statements.
For acquisitions during 2020 that were accounted for using the
purchase method, the excess of the purchase price over the fair
62 S&P Global 2022 Annual Report
value of the net assets acquired is allocated to goodwill and
other intangibles. The goodwill recognized on our acquisitions
is largely attributable to anticipated operational synergies and
growth opportunities as a result of the acquisition. The intangible
assets, excluding goodwill and indefinite-lived intangibles, are
being amortized over their anticipated useful lives between 3 and
10 years. The goodwill for Greenwich and ESG Ratings Business
is deductible for tax purposes.
Non-cash investing activities
Liabilities assumed in conjunction with our acquisitions
are as follows:
Year ended December 31,
(in millions)
2022
Fair value of assets acquired
$54,944
Equity transferred
Cash acquired (paid), net
Liabilities assumed
(43,536)
210
$11,618
2021
$110
—
(99)
$11
2020
$219
—
(201)
$18
DIVESTITURES
2023
On January 14, 2023, we entered into a securities and asset
purchase agreement with Allium Buyer LLC, a Delaware limited
liability company controlled by funds affiliated with Kohlberg
Kravis Roberts & Co. L.P. (“KKR”) to sell our Engineering Solutions
business for $975 million in cash, subject to customary purchase
price adjustments. We currently anticipate the divestiture to
result in after-tax proceeds of approximately $750 million, which
proceeds are expected to be used for share repurchases. The
agreement follows our announced intent in November of 2022 to
divest the business. Engineering Solutions became part of the
Company following our merger with IHS Markit. The transaction,
which is subject to receipt of required regulatory approvals and
satisfying other customary closing conditions, is expected to
close by the end of the second quarter of 2023.
2022
As a condition of securing regulatory approval for the merger,
S&P Global and IHS Markit agreed to divest of certain of their
businesses. S&P Global’s divestitures include CUSIP Global
Services, its Leveraged Commentary and Data (“LCD”) business
and a related family of leveraged loan indices while IHS Markit’s
divestitures include Oil Price Information Services (“OPIS”); Coal,
Metals and Mining; and PetroChem Wire businesses and its Base
Chemicals business.
During the year ended December 31, 2022, we completed
the following dispositions that resulted in a pre-tax gain of
$1.9 billion, which was included in Gain on dispositions in the
consolidated statement of income:
– In June of 2022, we completed the previously announced
sale of Leveraged Commentary and Data (“LCD”) along
with a related family of leveraged loan indices, within our
Market Intelligence and Indices segments, respectively, to
Morningstar for a purchase price of $600 million in cash,
subject to customary adjustments, and a contingent payment
of up to $50 million which is payable six months following the
closing upon the achievement of certain conditions related to
the transition of LCD customer relationships. The contingent
payment is expected to be received in the first quarter of
2023. During the year ended December 31, 2022, we recorded
a pre-tax gain of $505 million ($378 million after-tax) for the
sale of LCD. During the year ended December 31, 2022, we
recorded a pre-tax gain of $52 million ($43 million after-tax)
for the sale of a family of leveraged loan indices in Gain on
dispositions in the consolidated statements of income.
– In June of 2022, we completed the previously announced sale
of the Base Chemicals business to News Corp for $295 million
in cash. We did not recognize a gain on the sale of the Base
Chemicals business.
– In March of 2022, we completed the previously announced
sale of CUSIP Global Services (“CGS”), a business within our
Market Intelligence segment, to FactSet Research Systems
Inc. for a purchase price of $1.925 billion in cash, subject to
customary adjustments. During the year ended December
31, 2022, we recorded a pre-tax gain of $1.342 billion ($1.005
billion after-tax) in Gain on dispositions in the consolidated
statements of income related to the sale of CGS.
– In February of 2022, we completed the previously announced
sale of OPIS to News Corp for $1.150 billion in cash. We did
not recognize a gain on the sale of OPIS.
2021
During the year ended December 31, 2021, we completed the
following dispositions that resulted in a pre-tax gain of $11
million, which was included in Gain on dispositions in the
consolidated statement of income:
– During the year ended December 31, 2021, we recorded
a pre-tax gain of $8 million ($6 million after-tax) in Gain
on dispositions in the consolidated statements of income
related to the sale of office facilities in India.
– During the year ended December 31, 2021, we recorded a
pre-tax gain of $3 million ($3 million after-tax) in Gain on
dispositions in the consolidated statements of income related
to the sale of Standard & Poor’s Investment Advisory Services
LLC (“SPIAS”), a business within our Market Intelligence
segment, that occurred in July of 2019.
S&P Global 2022 Annual Report 63
2020
During the year ended December 31, 2020, we completed the
following dispositions that resulted in a pre-tax gain of $16
million, which was included in Gain on dispositions in the
consolidated statement of income:
– In January of 2020, Market Intelligence entered into
a strategic alliance to transition S&P Global Market
Intelligence’s Investor Relations (“IR”) webhosting business
to Q4 Inc. (“Q4”). This alliance integrated Market Intelligence’s
proprietary data into Q4’s portfolio of solutions, enabling
further opportunities for commercial collaboration. In
connection with transitioning its IR webhosting business to
Q4, Market Intelligence received a minority investment in
Q4. During the year ended December 31, 2020, we recorded
a pre-tax gain of $11 million ($6 million after-tax) in Gain
on dispositions in the consolidated statements of income
related to the sale of IR.
– In September of 2020, we sold our facility at East Windsor,
New Jersey. During the year ended December 31, 2020, we
recorded a pre-tax gain of $4 million ($3 million after-tax)
in Gain on dispositions in the consolidated statements of
income related to the sale of East Windsor.
– During the year ended December 31, 2020, we recorded a
pre-tax gain of $1 million ($1 million after-tax) in Gain on
dispositions in the consolidated statements of income related
to the sale of Standard & Poor’s Investment Advisory Services
LLC (“SPIAS”), a business within our Market Intelligence
segment, in July of 2019.
The components of assets and liabilities held for sale in the
consolidated balance sheet consist of the following:
(in millions)
Accounts Receivable, net
Goodwill
Other intangible assets, net
Other assets
Year ended December 31,
20221
20212
$88
437
697
76
$59
255
—
7
Assets of businesses held for sale
$1,298
$321
Accounts payable and accrued expenses
Deferred tax liability
Unearned revenue
$59
27
148
$11
—
138
Liabilities of businesses held for sale
$234
$149
1
2
Assets and liabilities held for sale as of December 31, 2022 relate to
Engineering Solutions.
Assets and liabilities held for sale as of December 31, 2021 relate
to CGS and LCD.
The operating profit of our businesses that were held for sale or
disposed of for the years ending December 31, 2022, 2021, and
2020 is as follows:
(in millions)
Operating profit 1
Year ended December 31,
2022
$71
2021
$172
2020
$162
1
The operating profit presented includes the revenue and recurring direct
expenses associated with businesses held for sale. The year ended
December 31, 2022 excludes pre-tax gains related to the sale LCD and a
related family of leveraged loan indices of $505 million and $52 million,
respectively. The year ended December 31, 2022 also excludes a a pre-tax
gain of $1.3 billion related to the sale of CGS. The year ended December 31,
2021 excludes a pre-tax gain on the sale of SPIAS of $3 million. The year
ended December 31, 2020 excludes a pre-tax gain on the sale of the IR
webhosting business of $11 million.
64 S&P Global 2022 Annual Report
3. Goodwill and Other
Intangible Assets
GOODWILL
Goodwill represents the excess of purchase price and related
costs over the value assigned to the net tangible and identifiable
intangible assets of businesses acquired.
The change in the carrying amount of goodwill by segment is shown below:
(in millions)
Market
Intelligence
Ratings
Commodity
Insights
Mobility
Indices
Engineering
Solutions
Corporate
Total
Balance as of December 31, 2020
Acquisitions
Reclassifications 1
Other 2
Balance as of December 31, 2021
Acquisitions
Dispositions
Reclassifications 3
Other 2
$2,071
—
(255)
(8)
1,808
16,556
(246)
—
(8)
$263
—
—
(18)
245
22
—
—
(10)
$527
—
—
(2)
525
5,009
—
—
(12)
$—
—
—
—
—
8,695
—
—
—
$376
—
—
—
376
1,023
—
—
—
Balance as of December 31, 2022
$18,110
$257
$5,522
$8,695
$1,399
$—
—
—
—
—
437
—
(437)
—
$—
$498
54
—
—
552
—
—
—
10
$3,735
54
(255)
(28)
3,506
31,742
(246)
(437)
(20)
$562
$34,545
1
2
3
Relates to CGS and LCD, which are classified as assets held for sale in our consolidated balance sheet as of December 31, 2021.
Primarily relates to the impact of foreign exchange and valuation adjustments for prior period acquisitions. 2021 includes adjustments related to RobecoSAM.
Relates to Engineering Solutions, which is classified as assets held for sale in our consolidated balance sheet as of December 31, 2022.
Goodwill additions and dispositions in the table above relate to
transactions discussed in Note 2 – Acquisitions and Divestitures.
– 2022 and 2021 both include $185 million within our Market
Intelligence segment for the SNL tradename.
OTHER INTANGIBLE ASSETS
Other intangible assets include both indefinite-lived assets
not subject to amortization and definite-lived assets subject
to amortization. We have indefinite-lived assets with a carrying
value of $846 million as of December 31, 2022 and 2021.
– 2022 and 2021 both include $380 million and $90 million for
Dow Jones Indices intellectual property and the Dow Jones
tradename, respectively, that we recorded as part of the
transaction to form S&P Dow Jones Indices LLC in 2012.
– 2022 and 2021 both include $132 million within our Indices
segment for the balance of the IP rights in a family of indices
derived from the S&P 500, solidifying Indices IP in and to the
S&P 500 index family.
– 2022 and 2021 both include $59 million within our Indices
segment for the Goldman Sachs Commodity Index intellectual
property and the Broad Market Indices intellectual property.
S&P Global 2022 Annual Report 65
The following table summarizes our definite-lived intangible assets:
(in millions)
COST
Balance as of December 31, 2020
Acquisitions
Other 1
Balance as of December 31, 2021
Acquisitions
Dispositions
Reclassifications 2
Other 1
Databases
and software
Content
Customer
relationships
Tradenames
Other
intangibles
$645
—
—
645
3,774
—
(476)
(2)
$139
—
—
139
—
—
—
—
$356
—
(1)
355
$55
—
—
55
13,377
1,469
—
(257)
(8)
—
—
—
$177
18
11
206
17
(5)
—
(4)
Total
$1,372
18
10
1,400
18,637
(5)
(733)
(14)
Balance as of December 31, 2022
$3,941
$139
$13,467
$1,524
$214
$19,285
ACCUMULATED AMORTIZATION
Balance as of December 31, 2020
$406
$139
$175
$50
Current year amortization
Reclassifications 3
Other 1
Balance as of December 31, 2021
Current year amortization
Reclassifications 2
Other 1
52
8
1
467
313
(13)
(2)
—
—
—
139
—
—
—
21
—
—
196
482
(22)
—
2
—
—
52
91
—
(1)
$96
21
(8)
(2)
107
19
—
(3)
$866
96
—
(1)
961
905
(35)
(6)
Balance as of December 31, 2022
$765
$139
$656
$142
$123
$1,825
NET DEFINITE-LIVED INTANGIBLES:
December 31, 2021
December 31, 2022
$178
$3,176
—
—
$159
$12,811
$3
$1,382
$99
$91
$439
$17,460
1
2
3
Primarily relates to the impact of foreign exchange and valuation adjustments for prior period acquisitions. 2021 includes adjustments related to RobecoSAM.
Relates to Engineering Solutions, which is classified as assets held for sale in our consolidated balance sheet as of December 31, 2022.
The reclassification in 2021 is related to RobecoSAM.
Definite-lived intangible assets are being amortized on a
straight-line basis over periods of up to 25 years. The weighted-
average life of the intangible assets as of December 31, 2022 is
approximately 21 years.
Amortization expense was $905 million, $96 million and $123
million for the years ended December 31, 2022, 2021 and 2020,
respectively. Expected amortization expense for intangible
assets over the next five years for the years ended December 31,
assuming no further acquisitions or dispositions, is as follows:
(in millions)
Amortization expense
2023
2024
2025
$1,029
$1,023
$1,007
2026
$976
2027
$960
66 S&P Global 2022 Annual Report
4. Taxes on Income
Income before taxes on income resulting from domestic and
foreign operations is as follows:
The increase in the effective income tax rate in 2022 was
primarily due to the tax charge on merger related divestitures.
The increase in the effective income tax rate in 2021 was
primarily due to a change in the mix of income by jurisdiction.
Year ended December 31,
(in millions)
2022
2021
2020
Domestic operations
Foreign operations
$3,426
1,276
$2,874
1,290
$2,226
1,002
Total income before taxes
$4,702
$4,164
$3,228
The provision for taxes on income consists of the following:
We have elected to recognize the tax on Global Intangible Low
Taxed Income (“GILTI”) as a period expense in the year the tax is
incurred. GILTI expense is included in Other, net above.
The principal temporary differences between the accounting
for income and expenses for financial reporting and income tax
purposes are as follows:
(in millions)
Federal:
Current
Deferred
Total federal
Foreign:
Current
Deferred
Total foreign
State and local:
Current
Deferred
Total state and local
(in millions)
Deferred tax assets:
Employee compensation
Year ended December 31,
Accrued expenses
2022
2021
2020
Postretirement benefits
$928
(185)
743
322
(98)
224
265
(52)
213
Unearned revenue
$438
$349
Forward exchange contracts
(9)
429
295
23
318
153
1
154
$901
1
350
246
(9)
237
111
(4)
107
Fixed Assets
Loss carryforwards
Lease liabilities
Other
Total deferred tax assets
Deferred tax liabilities:
Goodwill and intangible assets
Right of use asset
Postretirement benefits
Forward exchange contracts
$694
Fixed assets
Total provision for taxes
$1,180
A reconciliation of the U.S. federal statutory income tax
rate to our effective income tax rate for financial reporting
purposes is as follows:
Year ended December 31,
2022
2021
2020
Total deferred tax liabilities
Net deferred income tax asset
before valuation allowance
Valuation allowance
Net deferred income tax liability
Reported as:
Non-current deferred tax assets
Non-current deferred tax liabilities
U.S. federal statutory income
tax rate
State and local income taxes
Divestitures
Foreign operations
Stock-based compensation
S&P Dow Jones Indices LLC
joint venture
Tax credits and incentives
Other, net
21.0% 21.0% 21.0%
Net deferred income tax liability
3.9
2.9
3.3
—
(2.8)
(0.2)
— (0.8)
(1.1)
(1.3)
2.5
(1.1)
(2.3)
1.7
3.0
—
(0.3)
(0.7)
(1.2)
(2.2)
1.9
Effective income tax rate
25.1% 21.6% 21.5%
December 31,
2022
2021
$100
179
27
67
—
49
537
170
126
1,255
(4,791)
(100)
(33)
(41)
—
(4,965)
(3,710)
(274)
$(3,984)
$81
(4,065)
$(3,984)
$57
54
28
74
71
—
204
142
32
662
(394)
(101)
(46)
—
(6)
(547)
115
(206)
$(91)
$56
(147)
$(91)
S&P Global 2022 Annual Report 67
We record valuation allowances against deferred income tax
assets when we determine that it is more likely than not that
such deferred income tax assets will not be realized based upon
all the available evidence. The valuation allowance is primarily
related to operating losses.
As of December 31, 2022, we have approximately $10.1 billion
of undistributed earnings of our foreign subsidiaries, of which
$4.1 billion is reinvested indefinitely in our foreign operations.
We have not recorded deferred income taxes applicable
to undistributed earnings of foreign subsidiaries that are
indefinitely reinvested in foreign operations. Quantification
of the deferred tax liability, if any, associated with indefinitely
reinvested earnings is not practicable.
We made net income tax payments totaling $1,555 million
in 2022, $883 million in 2021, and $683 million in 2020. As of
December 31, 2022, we had net operating loss carryforwards of
$1,301 million, of which a significant portion has an unlimited
carryover period under current law.
A reconciliation of the beginning and ending amount of
unrecognized tax benefits is as follows:
Year ended December 31,
(in millions)
2022
2021
2020
Balance at beginning of year
$147
$121
$124
Additions based on tax positions
related to the current year
Additions for tax positions of prior
years
Reduction for tax positions of prior
years
Reduction for settlements
Expiration of applicable
statutes of limitations
28
62
—
—
35
9
—
(8)
(14)
(10)
24
1
(13)
(4)
(11)
Balance at end of year
$223
$147
$121
The total amount of federal, state and local, and foreign
unrecognized tax benefits as of December 31, 2022, 2021
and 2020 was $223 million, $147 million and $121 million,
respectively, exclusive of interest and penalties. During the
year ended December 31, 2022, the change in unrecognized tax
benefits resulted in a net increase of tax expense of $52 million.
We recognize accrued interest and penalties related to
unrecognized tax benefits in interest expense and operating-
related expense, respectively. Based on the current status
of income tax audits, we believe that the total amount of
unrecognized tax benefits on the balance sheet may be reduced
by up to approximately $20 million in the next twelve months
as a result of the resolution of local tax examinations and
expiration of applicable statutes of limitations. In addition to the
unrecognized tax benefits, we had accrued interest and penalties
associated with unrecognized tax benefits of $38 million and $24
million as of December 31, 2022 and 2021, respectively.
The U.S. federal income tax audits for 2018 through 2022 are in
process. During 2022, we completed state and foreign tax audits
and, with few exceptions, we are no longer subject to federal,
state, or foreign income tax examinations by tax authorities for
the years before 2014. The impact to tax expense in 2022, 2021
and 2020 was not material.
We file income tax returns in the U.S. federal jurisdiction and
various state and foreign jurisdictions, and we are routinely
under audit by many different tax authorities. We believe that
our accrual for tax liabilities is adequate for all open audit
years based on an assessment of many factors including past
experience and interpretations of tax law. This assessment
relies on estimates and assumptions and may involve a series
of complex judgments about future events. It is possible that
tax examinations will be settled prior to December 31, 2023. If
any of these tax audit settlements do occur within that period,
we would make any necessary adjustments to the accrual for
unrecognized tax benefits.
68 S&P Global 2022 Annual Report
5. Debt
A summary of long-term debt outstanding is as follows:
December 31,
(in millions)
4.125% Senior Notes, due 2023 1
3.625% Senior Notes, due 2024 2
4.75% Senior Notes, due 2025 3
4.0% Senior Notes, due 2025 4
4.0% Senior Notes, due 2026 5
2.95% Senior Notes, due 2027 6
2.45% Senior Notes, due 2027 7
4.75% Senior Notes, due 2028 8
4.25% Senior Notes, due 2029 9
2.5% Senior Notes, due 2029 10
2.70% Sustainability-Linked
Senior Notes, due 2029 11
1.25% Senior Notes, due 2030 12
2.90% Senior Notes, due 2032 13
6.55% Senior Notes, due 2037 14
4.5% Senior Notes, due 2048 15
3.25% Senior Notes, due 2049 16
3.7% Senior Notes, due 2052 17
2.3% Senior Notes, due 2060 18
3.9% Senior Notes, due 2062 19
Commercial paper
Total debt
Less: short-term debt including
current maturities
2022
$38
48
4
—
3
496
1,237
823
1,029
497
1,233
594
1,472
290
272
590
974
682
486
188
2021
$—
—
—
696
—
496
—
—
—
496
593
—
290
273
589
—
681
—
—
12
13
14
15
16
17
18
Interest payments are due semiannually on February 15 and August 15, and
as of December 31, 2022, the unamortized debt discount and issuance costs
total $6 million.
Interest payments are due semiannually on March 1 and September
1, beginning on September 1, 2022, and as of December 31, 2022, the
unamortized debt discount and issuance costs total $28 million.
Interest payments are due semiannually on May 15 and November 15, and
as of December 31, 2022, the unamortized debt discount and issuance costs
total $3 million.
Interest payments are due semiannually on May 15 and November 15, and
as of December 31, 2022, the unamortized debt discount and issuance costs
total $11 million.
Interest payments are due semiannually on June 1 and December 1, and as
of December 31, 2022, the unamortized debt discount and issuance costs
total $10 million.
Interest payments are due semiannually on March 1 and September
1, beginning on September 1, 2022, and as of December 31, 2022, the
unamortized debt discount and issuance costs total $26 million.
Interest payments are due semiannually on February 15 and August 15, and
as of December 31, 2022, the unamortized debt discount and issuance costs
total $18 million.
Interest payments are due semiannually on March 1 and September
1, beginning on September 1, 2022, and as of December 31, 2022, the
unamortized debt discount and issuance costs total $14 million.
—
19
Annual long-term debt maturities are scheduled as follows
based on book values as of December 31, 2022: $38 million due in
2023, $48 million due in 2024, $4 million due in 2025; $3 million
due in 2026; $1.7 billion amounts due in 2027; and $8.9 billion
due thereafter.
The fair value of our total debt borrowings was $9.3 billion and
$4.4 billion as of December 31, 2022 and December 31, 2021,
respectively, and was estimated based on quoted market prices.
On February 28, 2022, we completed the merger with IHS Markit
in an all-stock transaction. In the transaction, we assumed IHS
Markit’s publicly traded debt, with an outstanding principal
balance of $4.6 billion, which was recorded at fair value of
$4.9 billion on the acquisition date. Debt assumed consisted
of the following:
Long-term debt
$10,730
$4,114
10,956
4,114
226
—
1
2
3
4
5
6
7
8
9
10
11
Interest payments are due semiannually on February 1 and August 1.
Interest payments are due semiannually on May 1 and November 1.
– 5.00% Senior Notes due November 1, 2022 with an
outstanding principal balance of $748 million.
Interest payments are due semiannually on February 15 and August 15.
– 4.125% Senior Notes due August 1, 2023 with an outstanding
We made a $287 million payment on the early retirement of our 4.0% senior
notes in the second quarter of 2022.
principal balance of $500 million.
– 3.625% Senior Notes due May 1, 2024 with an outstanding
Interest payments are due semiannually on March 1 and September 1.
principal balance of $400 million.
Interest payments are due semiannually on January 22 and July 22, and as
of December 31, 2022, the unamortized debt discount and issuance costs
total $4 million.
– 4.75% Senior Notes due February 15, 2025 with an
outstanding principal balance of $800 million.
Interest payments are due semiannually on March 1 and September
1, beginning on September 30, 2022, and as of December 31, 2022, the
unamortized debt discount and issuance costs total $13 million.
Interest payments are due semiannually on February 1 and August 1.
Interest payments are due semiannually on May 1 and November 1.
Interest payments are due semiannually on June 1 and December 1, and as
of December 31, 2022, the unamortized debt discount and issuance costs
total $3 million.
Interest payments are due semiannually on March 1 and September
1, beginning on September 1, 2022, and as of December 31, 2022, the
unamortized debt discount and issuance costs total $17 million.
– 4.00% Senior Notes due March 1, 2026 with an outstanding
principal balance of $500 million.
– 4.75% Senior Notes due August 1, 2028 with an outstanding
principal balance of $750 million.
– 4.25% Senior Notes due May 1, 2029 with an outstanding
principal balance of $950 million.
S&P Global 2022 Annual Report 69
The adjustment to fair value of the Senior Notes of approximately
$292 million on the acquisition date will be amortized as an
adjustment to interest expense over the remaining contractual
terms of the Senior Notes.
On March 2, 2022, we completed the offer (the “Exchange Offer”)
to exchange outstanding notes issued by IHS Markit for new
notes issued by us and fully and unconditionally guaranteed by
Standard & Poor’s Financial Services LLC with the same interest
rate, interest payment dates, maturity date and redemption
terms as each corresponding series of exchange IHS Markit
notes and cash. Of the approximately $4.6 billion in aggregate
principal amount of IHS Markit’s Senior Notes offered in the
exchange, 96%, or approximately $4.5 billion, were tendered
and accepted. The portion not exchanged, approximately $175
million, remains outstanding across seven series of Senior Notes
issued by IHS Markit. The Exchange Offer was treated as a debt
modification for accounting purposes resulting in a portion of
the unamortized fair value adjustment of the IHS Markit Senior
Notes allocated to the new debt issued by S&P Global on the
settlement date of the exchange. See Note 2 — Acquisitions and
Divestitures for additional information on the merger.
On March 18, 2022, we issued $1,250 million of 2.45% Senior
Notes due 2027, $1,250 million of 2.7% Sustainability-Linked
Senior Notes due 2029, $1,500 million of 2.9% Senior Notes due
2032, $1,000 million of 3.7% Senior Notes due 2052, and $500
million of 3.9% Senior Notes due 2062. The Notes are fully and
unconditionally guaranteed by our wholly-owned subsidiary,
Standard & Poor’s Financial Services LLC. In the first quarter
of 2022, we used a portion of the net proceeds from the new
debt issuance to fund the redemption and extinguishment of
the outstanding principal amount of our 4.125% Senior Notes
due 2023, 3.625% Senior Notes due 2024, and our 4.0% Senior
Notes due 2026 which were former IHS Markit Notes that were
exchanged to SPGI Notes as part of the Exchange Offer. In
addition, we also used part of the net proceeds from the new
debt issuance noted above to fund the early tender as well as a
subsequent full redemption of our 5.0% Senior Notes due 2022
and the 4.750% Senior Notes due 2025, both of which were
former IHS Markit Notes that were exchanged to SPGI Notes
as part of the Exchange Offer, as well as our 4.0% Senior Notes
due 2025. The majority of these transactions settled within
the first quarter of 2022, however, given the timing of certain
redemptions, a lesser portion of these settled in the second
quarter of 2022, including the redemption and extinguishment
of the $287 million outstanding principal amount on our 4.0%
senior notes due in 2025, and a portion of the outstanding
principal amounts of our 5.0% senior notes due in 2022 and our
4.75% senior notes due in 2025, of approximately $52 million and
$247 million, respectively.
During the year ended December 31, 2022, we recognized an
$8 million loss on extinguishment of debt. The year ended
December 31, 2022 includes a $142 million tender premium
paid to tendering note holders in accordance with the terms
of the tender offer, partially offset by a $134 million non-cash
write-off related to the fair market value step up premium on
extinguished debt.
On August 13, 2020, we issued $600 million of 1.25% senior
notes due in 2030 and $700 million of 2.3% senior notes due in
2060. The notes are fully and unconditionally guaranteed by our
wholly-owned subsidiary, Standard & Poor’s Financial Services
LLC. In the third quarter of 2020, we used the net proceeds to
fund the redemption and extinguishment of the $900 million
outstanding principal amount of our 4.4% senior notes due
in 2026 and a portion of the outstanding principal amount
of our 6.55% senior notes due in 2037 and our 4.5% senior
notes due in 2048.
We have the ability to borrow a total of $2.0 billion through our
commercial paper program, which is supported by our $2.0
billion five-year credit agreement (our “credit facility”) that will
terminate on April 26, 2026. On April 26, 2021, we entered into
a revolving $1.5 billion five-year credit agreement that included
an accordion feature which allowed the Company to increase
the total commitments thereunder by up to an additional $500
million, subject to certain customary terms and conditions. On
February 25, 2022, we exercised the accordion feature which
increased the total commitments available under our credit
facility from $1.5 billion to $2.0 billion. As of December 31, 2022
there was $188 million of commercial paper outstanding.
Commitment fees for the unutilized commitments under the
credit facility and applicable margins for borrowings thereunder
are linked to the Company achieving three environmental
sustainability performance indicators related to emissions,
tested annually. We currently pay a commitment fee of 8 basis
points. The credit facility contains customary affirmative and
negative covenants and customary events of default. The
occurrence of an event of default could result in an acceleration
of the obligations under the credit facility.
The only financial covenant required under our credit facility is
that our indebtedness to cash flow ratio, as defined in our credit
facility, was not greater than 4 to 1, and this covenant level has
never been exceeded.
70 S&P Global 2022 Annual Report
6. Derivative Instruments
Our exposure to market risk includes changes in foreign
exchange rates and interest rates. We have operations in foreign
countries where the functional currency is primarily the local
currency. For international operations that are determined
to be extensions of the parent company, the U.S. dollar is
the functional currency. We typically have naturally hedged
positions in most countries from a local currency perspective
with offsetting assets and liabilities. As of December 31, 2022
and December 31, 2021, we have entered into foreign exchange
forward contracts to mitigate or hedge the effect of adverse
fluctuations in foreign exchange rates and cross currency swap
contracts to hedge a portion of our net investment in a foreign
subsidiary against volatility in foreign exchange rates. As of
December 31, 2022 and December 31, 2021, we entered into a
series of interest rate swaps to mitigate or hedge the adverse
fluctuations in interest rates on our future debt refinancing.
These contracts are recorded at fair value that is based on
foreign currency exchange rates and interest rates in active
markets; therefore, we classify these derivative contracts within
Level 2 of the fair value hierarchy. We do not enter into any
derivative financial instruments for speculative purposes.
Undesignated Derivative Instruments
During the twelve months ended December 31, 2022, 2021
and 2020 we entered into foreign exchange forward contracts
in order to mitigate the change in fair value of specific assets
and liabilities in the consolidated balance sheet. These forward
contracts do not qualify for hedge accounting. As of December
31, 2022 and 2021, the aggregate notional value of these
outstanding forward contracts was $1.8 billion and $376
million, respectively. The changes in fair value of these forward
contracts are recorded in prepaid and other assets or other
current liabilities in the consolidated balance sheet with their
corresponding change in fair value recognized in selling and
general expenses in the consolidated statement of income. The
amount recorded in prepaid and other current assets was $5
million as of December 31, 2022 and 2021. The amount recorded
in other current liabilities was $37 million as of December
31, 2022 and less than $1 million as of December 31, 2021.
The amount recorded in selling and general expense for the
twelve months ended December 31, 2022 and 2021 related to
these contracts was a net loss $45 million and a net gain of $9
million, respectively.
Net Investment Hedges
During the twelve months ended December 31, 2021, we entered
into cross currency swaps to hedge a portion of our net investment
in one of our European subsidiaries against volatility in the
Euro/U.S. dollar exchange rate. These swaps are designated and
qualify as a hedge of a net investment in a foreign subsidiary and
are scheduled to mature in 2024, 2029 and 2030. The notional
value of our outstanding cross currency swaps designated as a
net investment hedge was $1 billion as of December 31, 2022 and
2021. The changes in the fair value of swaps are recognized in
foreign currency translation adjustments, a component of other
comprehensive income (loss), and reported in accumulated other
comprehensive loss in our consolidated balance sheet. The gain or
loss will be subsequently reclassified into net earnings when the
hedged net investment is either sold or substantially liquidated.
We have elected to assess the effectiveness of our net investment
hedges based on changes in spot exchange rates. Accordingly,
amounts related to the cross currency swaps recognized directly
in net income represent net periodic interest settlements and
accruals, which are recognized in interest expense, net. We
recognized net interest expense of $31 million and net interest
income of $20 million during the twelve months ended December
31, 2022 and 2021, respectively.
Cash Flow Hedges
Foreign Exchange Forward Contracts
During the twelve months ended December 31, 2022, 2021
and 2020, we entered into a series of foreign exchange forward
contracts to hedge a portion of the Indian rupee, British pound,
and Euro exposures through the fourth quarter of 2024, 2023
and 2022, respectively. These contracts are intended to offset
the impact of movement of exchange rates on future revenue
and operating costs and are scheduled to mature within twenty-
four months. The changes in the fair value of these contracts are
initially reported in accumulated other comprehensive loss in our
consolidated balance sheet and are subsequently reclassified
into revenue and selling and general expenses in the same period
that the hedged transaction affects earnings.
As of December 31, 2022, we estimate that $1 million of pre-tax
gain related to foreign exchange forward contracts designated
as cash flow hedges recorded in other comprehensive
income is expected to be reclassified into earnings within the
next twelve months.
As of December 31, 2022 and December 31, 2021, the aggregate
notional value of our outstanding foreign exchange forward
contracts designated as cash flow hedges was $529 million and
$498 million, respectively.
Interest Rate Swaps
During the twelve months ended December 31, 2021, we entered
into a series of interest rate swaps. These contracts are intended
to mitigate or hedge the adverse fluctuations in interest rates
on our future debt refinancing and are scheduled to mature
beginning in the first quarter of 2027. These interest rate swaps
are designated as cash flow hedges. The changes in the fair value
of these contracts are initially reported in accumulated other
comprehensive loss in our consolidated balance sheet and will
be subsequently reclassified into interest expense, net in the
same period that the hedged transaction affects earnings.
As of December 31, 2022 and December 31, 2021, the aggregate
notional value of our outstanding interest rate swaps designated
as cash flow hedges was $1.4 billion and $2.3 billion.
S&P Global 2022 Annual Report 71
The following table provides information on the location and fair value amounts of our cash flow hedges and net investment hedges
as of December 31, 2022 and December 31, 2021:
(in millions)
Balance Sheet Location
Derivatives designated as cash flow hedges:
Prepaid and other current assets
Foreign exchange forward contracts
Other current liabilities
Other non-current assets
Other non-current liabilities
Foreign exchange forward contracts
Interest rate swap contracts
Interest rate swap contracts
Derivatives designated as net investment hedges:
Other non-current assets
Other non-current liabilities
Cross currency swaps
Cross currency swaps
December 31,
2022
2021
$3
$7
$145
$7
$—
$—
$— $270
$84
$—
$—
$17
72 S&P Global 2022 Annual Report
The following table provides information on the location and amounts of pre-tax gains (losses) on our cash flow hedges and net
investment hedges for the years ended December 31:
Gain (Loss) Recognized
in Accumulated Other
Comprehensive Loss
(effective portion)
Location of Gain (Loss)
Reclassified from
Accumulated Other
Comprehensive Loss into
Income (effective portion)
Gain (Loss) Reclassified
from Accumulated
Other Comprehensive
Loss into Income
(effective portion)
(in millions)
2022
2021
2020
2022
2021
2020
Cash flow hedges - designated as
hedging instruments
Foreign exchange forward contracts
$(8)
$(11)
$17
Revenue, Selling and
general expenses
Interest rate swap contracts
$333
$(270)
$—
Interest expense, net
$(6)
$(4)
$19
$2
$—
$—
Net investment hedges - designated as
hedging instruments
Cross currency swaps
$98
$84
$(97)
Interest expense, net
$(4)
$(5)
$—
The activity related to the change in unrealized gains (losses) in accumulated other comprehensive loss was as follows for the years
ended December 31:
(in millions)
Cash Flow Hedges
Foreign exchange forward contracts
Net unrealized gains on cash flow hedges, net of taxes, beginning of period
Change in fair value, net of tax
Reclassification into earnings, net of tax
Net unrealized gains on cash flow hedges, net of taxes, end of period
Interest rate swap contracts
Net unrealized losses on cash flow hedges, net of taxes, beginning of period
Change in fair value, net of tax
Reclassification into earnings, net of tax
Net unrealized gains (losses) on cash flow hedges, net of taxes, end of period
Net Investment Hedges
Year ended December 31,
2022
2021
2020
$6
(11)
5
$—
$14
11
(19)
$6
$(203)
$—
247
(203)
4
—
$48
$(203)
$2
14
(2)
$14
$—
—
—
$—
$(8)
(73)
—
Net unrealized losses on net investment hedges, net of taxes, beginning of period
$(17)
$(81)
Change in fair value, net of tax
Reclassification into earnings, net of tax
69
4
59
5
Net unrealized gains (losses) on net investment hedges, net of taxes, end of period
$56
$(17)
$(81)
S&P Global 2022 Annual Report 73
7. Employee Benefits
We maintain a number of active defined contribution retirement
plans for our employees. The majority of our defined benefit
plans are frozen. As a result, no new employees will be permitted
to enter these plans and no additional benefits for current
participants in the frozen plans will be accrued.
We also have supplemental benefit plans that provide senior
management with supplemental retirement, disability and death
benefits. Certain supplemental retirement benefits are based on
final monthly earnings. In addition, we sponsor a voluntary 401(k)
plan under which we may match employee contributions up to
certain levels of compensation as well as profit-sharing plans
under which we contribute a percentage of eligible employees’
compensation to the employees’ accounts.
We also provide certain medical, dental and life insurance
benefits for active and retired employees and eligible
dependents. The medical and dental plans and supplemental life
insurance plan are contributory, while the basic life insurance
plan is noncontributory. We currently do not prefund any
of these plans.
We recognize the funded status of our retirement and
postretirement plans in the consolidated balance sheets, with a
corresponding adjustment to accumulated other comprehensive
loss, net of taxes. The amounts in accumulated other
comprehensive loss represent net unrecognized actuarial losses
and unrecognized prior service costs. These amounts will be
subsequently recognized as net periodic pension cost pursuant
to our accounting policy for amortizing such amounts.
Net periodic benefit cost for our retirement and postretirement
plans other than the service cost component are included in
other income, net in our consolidated statements of income.
74 S&P Global 2022 Annual Report
Benefit Obligation
A summary of the benefit obligation and the fair value of plan
assets, as well as the funded status for the retirement and
postretirement plans as of December 31, 2022 and
2021, is as follows (benefits paid in the table below include
only those amounts contributed directly to or paid directly
from plan assets):
RETIREMENT PLANS
POSTRETIREMENT PLANS
(in millions)
Net benefit obligation at beginning of year
Service cost
Interest cost
Plan participants’ contributions
Actuarial gain 1
Gross benefits paid
Foreign currency effect
Other adjustments 2
Net benefit obligation at end of year
Fair value of plan assets at beginning of year
Actual return on plan assets
Employer contributions
Plan participants’ contributions
Gross benefits paid
Foreign currency effect
Fair value of plan assets at end of year
Funded status
Amounts recognized in consolidated balance sheets:
Non-current assets
Current liabilities
Non-current liabilities
2022
$2,122
3
48
—
(636)
(86)
(44)
—
1,407
2,231
(647)
11
—
(86)
(45)
1,464
$57
$232
(10)
(165)
$57
2021
$2,220
4
2022
$28
—
2021
$36
—
40
—
(55)
(77)
(10)
—
2,122
2,243
58
11
—
(77)
(4)
2,231
$109
$359
(10)
(240)
$109
1
—
(6)
(3)
—
—
20
6
1
—
—
(2)
—
5
1
2
(2)
(5)
—
(4)
28
9
—
—
2
(5)
—
6
$(15)
$(22)
$—
—
(15)
$(15)
$—
—
(22)
$(22)
Accumulated benefit obligation
$1,401
$2,110
Plans with accumulated benefit obligation in excess of the
fair value of plan assets:
Projected benefit obligation
Accumulated benefit obligation
Fair value of plan assets
Amounts recognized in accumulated other comprehensive loss,
net of tax:
Net actuarial loss (gain)
Prior service credit
Total recognized
$175
$168
$—
$400
—
$400
$250
$238
$—
$350
2
$352
$(39)
(12)
$(51)
$(36)
(14)
$(50)
1
2
The increase in actuarial gain in 2022 compared to 2021 was primarily due to an increase in the discount rate.
Relates to the impact of a plan amendment in 2021.
S&P Global 2022 Annual Report 75
Net Periodic Benefit Cost
For purposes of determining annual pension cost, prior service
costs are being amortized straight-line over the average
expected remaining lifetime of plan participants expected to
receive benefits.
(in millions)
Service cost
Interest cost
Expected return on assets
Amortization of:
Actuarial loss (gain)
Prior service credit
Net periodic benefit cost
Settlement charge 1
Total net periodic benefit cost
A summary of net periodic benefit cost for our retirement
and postretirement plans for the years ended December
31, is as follows:
RETIREMENT PLANS
POSTRETIREMENT PLANS
2022
2021
2020
2022
2021
2020
$3
48
(87)
15
—
(21)
13
$(8)
$4
40
$4
52
(104)
(102)
21
—
(39)
3
17
—
(29)
3
$—
1
—
(2)
(2)
(3)
—
$—
1
—
(2)
(1)
(2)
—
$—
1
—
(2)
(1)
(2)
—
$(36)
$(26)
$(3)
$(2)
$(2)
1
During the years ended December 31, 2022, 2021, and 2020, lump sum withdrawals exceeded the combined total anticipated annual service and interest cost of
our U.K. pension plan, triggering the recognition of non-cash pre-tax settlement charges of $13 million for 2022 and $3 million for 2021 and 2020.
Our U.K. retirement plan accounted for a benefit of $6 million
in 2022, $22 million in 2021 and $17 million in 2020 of the net
periodic benefit cost attributable to the funded plans.
Other changes in plan assets and benefit obligations recognized
in other comprehensive income, net of tax for the years ended
December 31, are as follows:
(in millions)
Net actuarial loss (gain)
Recognized actuarial (gain) loss
Prior service cost
Settlement charge 1
Total recognized
RETIREMENT PLANS
POSTRETIREMENT PLANS
2022
2021
2020
2022
2021
2020
$67
(12)
—
(10)
$45
$(6)
(15)
—
(2)
$(23)
$28
(9)
—
(2)
$17
$(3)
1
1
—
$(1)
$(1)
1
(1)
—
$(1)
$1
2
1
—
$4
1
During the years ended December 31, 2022, 2021, and 2020, lump sum withdrawals exceeded the combined total anticipated annual service and interest cost of
our U.K. pension plan, triggering the recognition of non-cash pre-tax settlement charges of $13 million for 2022 and $3 million for 2021 and 2020.
76 S&P Global 2022 Annual Report
The total cost for our retirement plans was $124 million for
2022, $93 million for 2021 and $91 million for 2020. Included
in the total retirement plans cost are defined contribution
plans cost of $88 million for 2022, $86 million for 2021 and $80
million for 2020.
Assumptions
Benefit obligation:
Discount rate 2
Net periodic cost:
Weighted-average healthcare cost rate 1
Discount rate - U.S. plan 2
Discount rate - U.K. plan 2
Return on assets 3
RETIREMENT PLANS
POSTRETIREMENT PLANS
2022
2021
2020
2022
2021
2020
5.63%
3.05%
2.75%
5.52% 2.72% 2.20%
3.05%
1.87%
4.00%
2.75%
1.36%
5.00%
3.45%
1.92%
5.50%
N/A
6.00%
2.72% 2.20% 3.08%
N/A
1
2
3
The health care cost trend rate no longer applies since all subsidized benefits subject to trend were eliminated in 2021.
Effective January 1, 2022, we changed our discount rate assumption on our U.S. retirement plans to 3.05% from 2.75% in 2021 and changed our discount rate
assumption on our U.K. plan to 1.87% from 1.36% in 2021.
The expected return on assets assumption is calculated based on the plan’s asset allocation strategy and projected market returns over the long-term. Effective
January 1, 2023, our return on assets assumption for the U.S. plan was increased to 6.00% from 4.00% and the U.K. plan was increased to 5.50% from 5.00%.
Cash Flows
In December of 2003, the Medicare Prescription Drug,
Improvement and Modernization Act of 2003 (the “Act”) was
enacted. The Act established a prescription drug benefit under
Medicare, known as “Medicare Part D”, and a federal subsidy
to sponsors of retiree healthcare benefit plans that provide a
benefit that is at least actuarially equivalent to Medicare Part
D. Our benefits provided to certain participants are at least
actuarially equivalent to Medicare Part D, and, accordingly, we
are entitled to a subsidy. Effective January 1, 2021, we elected to
no longer file for Medicare Part D subsidy.
Expected employer contributions in 2023 are $10 million
and $3 million for our retirement and postretirement plans,
respectively. In 2023, we may elect to make non-required
contributions depending on investment performance and the
pension plan status.
Information about the expected cash flows for our retirement
and postretirement plans is as follows:
(in millions)
2023
2024
2025
2026
2027
2028-2032
Retirement
Plans 1
Postretirement
Plans 2
$71
74
77
80
83
453
3
3
2
2
2
7
1
Reflects the total benefits expected to be paid from the plans or from our
assets including both our share of the benefit cost and the participants’
share of the cost.
2
Reflects the total benefits expected to be paid from our assets.
S&P Global 2022 Annual Report 77
Fair Value of Plan Assets
In accordance with authoritative guidance for fair value
measurements certain assets and liabilities are required to
be recorded at fair value. Fair value is defined as the amount
that would be received for selling an asset or paid to transfer a
liability in an orderly transaction between market participants.
A fair value hierarchy has been established which requires us to
maximize the use of observable inputs and minimize the use of
unobservable inputs when measuring fair value. The three levels
of inputs used to measure fair value are as follows:
– Level 1 - Unadjusted quoted prices in active markets for
identical assets or liabilities.
– Level 2 - Observable inputs other than Level 1 prices, such
as quoted prices for similar assets or liabilities; quoted
prices in markets that are not active; or other inputs that are
observable or can be corroborated by observable market data
for substantially the full term of the assets or liabilities.
– Level 3 - Unobservable inputs that are supported by little or
no market activity and that are significant to the fair value of
the assets or liabilities.
The fair value of our defined benefit plans assets as of December
31, 2022 and 2021, by asset class is as follows:
(in millions)
Cash and short-term investments
Equities:
U.S. indexes 1
Fixed income:
Long duration strategy 2
Intermediate duration securities
Real Estate:
U.K. 3
Infrastructure:
U.K. 4
Total
Common collective trust funds measured at net asset value
as a practical expedient
Collective investment funds 5
Total
December 31, 2022
Total
Level 1
Level 2
$5
6
—
—
—
—
$11
$—
—
1,007
38
—
81
$1,126
$5
6
1,007
38
34
81
$1,171
$293
$1,464
Level 3
$—
—
—
—
34
—
$34
78 S&P Global 2022 Annual Report
(in millions)
Cash and short-term investments
Equities:
U.S. indexes 1
Fixed income:
Long duration strategy 2
Intermediate duration securities
Real Estate:
U.K. 3
Infrastructure:
U.K. 4
Total
Common collective trust funds measured at net asset value
as a practical expedient:
Collective investment funds 5
Total
December 31, 2021
Total
Level 1
Level 2
$6
6
—
—
—
—
$12
$—
—
1,376
59
—
81
$1,516
$6
6
1,376
59
44
81
$1,572
$659
$2,231
Level 3
$—
—
—
—
44
—
$44
1
2
3
4
5
Includes securities that are tracked in the S&P Smallcap 600 index.
Includes securities that are mainly investment grade obligations of issuers in the U.S.
Includes a fund which holds real estate properties in the U.K.
Includes funds that invest in global infrastructure for the UK Pension.
Includes the Standard & Poor’s 500 Composite Stock Index, the Standard & Poor’s MidCap 400 Composite Stock Index, a short-term investment fund which is a
common collective trust vehicle, and other various asset classes.
S&P Global 2022 Annual Report 79
For securities that are quoted in active markets, the trustee/
custodian determines fair value by applying securities’ prices
obtained from its pricing vendors. For commingled funds that
are not actively traded, the trustee applies pricing information
provided by investment management firms to the unit quantities
of such funds. Investment management firms employ their
own pricing vendors to value the securities underlying each
commingled fund. Underlying securities that are not actively
traded derive their prices from investment managers, which in
turn, employ vendors that use pricing models (e.g., discounted
cash flow, comparables). The domestic defined benefit plans
have no investment in our stock, except through the S&P 500
commingled trust index fund.
The trustee obtains estimated prices from vendors for securities
that are not easily quotable and they are categorized accordingly
as Level 3. The following table details further information on our
plan assets where we have used significant unobservable inputs:
(in millions)
Balance as of December 31, 2021
Distributions
Gain (loss)
Balance as of December 31, 2022
Level 3
$44
(2)
(8)
$34
Pension Trusts’ Asset Allocations
There are two pension trusts, one in the U.S. and one in the U.K.
– The U.S. pension trust had assets of $1,185 million
and $1,600 million as of December 31, 2022 and 2021
respectively, and the target allocations in 2022 include 90%
fixed income, 5% domestic equities, 3% international equities
and 2% cash and cash equivalents. The year-on-year decline
in U.S. pension trust assets is primarily attributable to lower
valuations on the plan’s U.S. long duration fixed income
securities largely driven by increases to the U.S. Central
Bank’s interest rates.
– The U.K. pension trust had assets of $279 million and $631
million as of December 31, 2022 and 2021, respectively, and
the target allocations in 2022 include 39% fixed income,
29% infrastructure, 14% equities, 13% real estate and 5%
diversified growth funds. The year-over-year reduction in
U.K. plan assets is primarily driven by lower valuation of the
investment portfolio including a mix of fixed income and
growth assets driven by higher interest rates and challenging
U.K. economic environment for growth assets.
The pension assets are invested with the goal of producing a
combination of capital growth, income and a liability hedge. The
mix of assets is established after consideration of the long-
term performance and risk characteristics of asset classes.
Investments are selected based on their potential to enhance
returns, preserve capital and reduce overall volatility. Holdings
are diversified within each asset class. The portfolios employ
a mix of index and actively managed equity strategies by
market capitalization, style, geographic regions and economic
sectors. The fixed income strategies include U.S. long duration
securities, opportunistic fixed income securities and U.K. debt
instruments. The short-term portfolio, whose primary goal
is capital preservation for liquidity purposes, is composed of
government and government-agency securities, uninvested
cash, receivables and payables. The portfolios do not employ any
financial leverage.
U.S. Defined Contribution Plan
Assets of the defined contribution plan in the U.S. consist
primarily of investment options, which include actively managed
equity, indexed equity, actively managed equity/bond funds,
target date funds, S&P Global Inc. common stock, stable value
and money market strategies. There is also a self-directed
mutual fund investment option. The plan purchased 67,248
shares and sold 60,473 shares of S&P Global Inc. common
stock in 2022 and purchased 107,651 shares and sold 160,415
shares of S&P Global Inc. common stock in 2021. The plan held
approximately 1.2 million shares of S&P Global Inc. common
stock as of December 31, 2022 and 2021, respectively, with
market values of $402 million and $567 million, respectively. The
plan received dividends on S&P Global Inc. common stock of $4.0
million and $3.8 million during the years ended December 31,
2022 and December 31, 2021, respectively.
80 S&P Global 2022 Annual Report
The number of common shares reserved for issuance under the
2019 Plan are as follows:
(in millions)
Shares available for granting 1
Options outstanding
Total shares reserved for issuance
December 31,
2022
2021
19.3
0.2
19.5
19.5
0.3
19.8
1
Shares reserved for issuance under the Director Plan are less than 1.0
million at both December 31, 2022 and 2021.
We issue treasury shares upon exercise of stock options and
the issuance of restricted stock other stock-based awards.
To offset the dilutive effect of our equity compensation plans,
we periodically repurchase shares. See Note 9 – Equity for
further discussion.
Stock-based compensation expense and the corresponding tax
benefit are as follows:
Year ended December 31,
(in millions)
2022
2021
2020
Stock option expense
Restricted stock and other
stock-based awards expense
Total stock-based
compensation expense
Tax benefit
$—
214
$214
$38
$—
122
$122
$20
$—
90
$90
$15
8. Stock-Based Compensation
We issue stock-based incentive awards to our eligible employees
under the 2019 Employee Stock Incentive Plan and to our
eligible non-employee members of the Board of Directors under
a Director Deferred Stock Ownership Plan. No further awards
may be granted under the 2002 Employee Stock Incentive Plan
(the “2002 Plan”), although awards granted under the 2002 Plan
prior to the adoption of the new 2019 Plan in June of 2019 remain
outstanding in accordance with their terms.
– 2019 Employee Stock Incentive Plan (the “2019 Plan”)
The 2019 Plan permits the granting of stock options, stock
appreciation rights, restricted stock awards, performance
awards, and other stock-based awards.
– Director Deferred Stock Ownership Plan (the
“Director Plan”)
Under the Director Plan, common stock reserved may be
credited to deferred stock accounts for eligible non-employee
members of the Board of Directors. In general, the plan
requires that 50% of eligible Directors’ annual compensation
and dividend equivalents be credited to deferred stock
accounts. Each Director may also elect to defer all or a portion
of the remaining compensation and have an equivalent
number of shares credited to their deferred stock account.
Recipients under this plan are not required to provide
consideration to us other than rendering service. Shares will
be delivered as of the date a recipient ceases to be a member
of the Board of Directors or within five years thereafter, if so
elected. The plan will remain in effect until terminated by the
Board of Directors or until no shares of stock remain available
under the plan.
– 2014 Equity Incentive Award Plan and the Amended and
Restated IHS Inc. 2004 Long-Term Incentive Plan (the “IHS
Markit’s equity plans”)
In connection with the merger with IHS Markit, we assumed
the outstanding restricted stock units, performance-based
restricted stock units, deferred stock units, and stock options
granted under IHS Markit’s equity plans, converted using
the 0.2838 merger exchange ratio. From the merger date,
no additional awards under these plans may be granted;
however, the outstanding awards that were converted at the
merger date continue to vest in accordance with the terms of
the merger agreement.
S&P Global 2022 Annual Report 81
Stock Options
Stock options may not be granted at a price less than the fair
market value of our common stock on the date of grant. Stock
options granted vest over a four-year service period and have a
maximum term of 10 years. Stock option compensation costs are
recognized from the date of grant, utilizing a four-year graded
vesting method. Under this method, more than half of the costs
are recognized over the first twelve months, approximately one-
quarter of the costs are recognized over a twenty-four
month period starting from the date of grant, approximately
one-tenth of the costs are recognized over a thirty-six month
period starting from the date of grant, and the remaining costs
are recognized over a forty-eight month period starting from the
date of grant.
There were no stock options granted in 2022, 2021, and 2020.
Weighted-
average
exercise price
Weighted-average
remaining years of
contractual term
Aggregate
intrinsic value
$67.14
$97.29
$80.88
$68.02
$68.02
2022
$7
$13
$4
1.01
1.01
$67
$67
Year ended December 31,
2021
$13
$41
$11
2020
$16
$60
$13
Stock option activity is as follows:
(in millions, except per award amounts)
Shares
Options outstanding as of December 31, 2021
Assumed 1
Exercised
Options outstanding as of December 31, 2022
Options exercisable as of December 31, 2022
0.3
—
(0.1)
0.2
0.2
1
There are less than 0.1 million options that were assumed as part of the merger with IHS Markit.
Information regarding our stock option exercises is as follows:
(in millions)
Net cash proceeds from the exercise of stock options
Total intrinsic value of stock option exercises
Income tax benefit realized from stock option exercises
82 S&P Global 2022 Annual Report
Restricted Stock and Other Stock-Based Awards
Restricted stock and other stock-based awards (performance
and non-performance) have been granted under the 2002 Plan
and 2019 Plan. Performance unit awards only vest if we achieve
certain financial goals over the performance period. Restricted
stock non-performance awards have various vesting periods
(generally three years). Recipients of restricted stock and unit
awards are not required to provide consideration to us other than
rendering service.
The stock-based compensation expense for restricted stock
and other stock-based awards is determined based on the
market price of our stock at the grant date of the award applied
to the total number of awards that are anticipated to fully vest.
For performance awards, adjustments are made to expense
consistent with the expected percent achievement of the
performance goals.
Restricted stock and other stock-based award activity
is as follows:
(in millions, except per award
amounts)
Shares
Weighted-
average grant-
date fair value
Balance as of
December 31, 2021
Assumed
Granted
Vested
Forfeited
Balance as of
December 31, 2022
Total unrecognized
compensation expense
related to restricted awards
Weighted-average years
to be recognized over
0.5
0.9
0.7
(0.4)
(0.1)
1.6
$132
1.5
$299.28
$380.89
$384.65
$355.82
$372.36
$364.50
Weighted-average grant-
date fair value per award
Total fair value of restricted
stock and other stock-
based awards vested
Tax benefit relating to
restricted stock activity
Year ended December 31,
2022
2021
2020
$384.65
$296.49
$232.92
$146
$243
$134
$30
$48
$26
9. Equity
Capital Stock
Two million shares of preferred stock, par value $1 per share, are
authorized; none have been issued.
On January 25, 2023, the Board of Directors approved an
increase in the dividends for 2023 to a quarterly common stock
dividend of $0.90 per share.
Annualized dividend rate 1
Dividends paid (in millions)
Year ended December 31,
2022
$3.32
$1,024
2021
$3.08
$743
2020
$2.68
$645
1
The quarterly dividend rate was $0.77 per share in the first quarter of 2022
and increased to $0.85 per share beginning in the second quarter of 2022.
The quarterly dividend rate was $0.77 per share and $0.67 per share for the
years ended December 31, 2021 and 2020, respectively.
Stock Repurchases
On June 22, 2022, the Board of Directors approved a share
repurchase program authorizing the purchase of 30 million
shares (the “2022 Repurchase Program”), which was
approximately 9% of the total shares of our outstanding common
stock at that time. On January 29, 2020, the Board of Directors
approved a share repurchase program authorizing the purchase
of 30 million shares (the “2020 Repurchase Program”), which
was approximately 12% of the total shares of our outstanding
common stock at that time. On December 4, 2013, the Board of
Directors approved a share repurchase program authorizing the
purchase of 50 million shares (the “2013 Repurchase Program”),
which was approximately 18% of the total shares of our
outstanding common stock at that time.
Our purchased shares may be used for general corporate
purposes, including the issuance of shares for stock
compensation plans and to offset the dilutive effect of the
exercise of employee stock options. As of December 31,
2022, 27.2 million shares remained available under the 2022
Repurchase Program and the 2020 and 2013 repurchase
programs were completed. Our 2022 Repurchase Program has no
expiration date and purchases under this program may be made
from time to time on the open market and in private transactions,
depending on market conditions.
We have entered into accelerated share repurchase (“ASR”)
agreements with financial institutions to initiate share
repurchases of our common stock. Under an ASR agreement, we
pay a specified amount to the financial institution and receive an
initial delivery of shares. This initial delivery of shares represents
the minimum number of shares that we may receive under the
agreement. Upon settlement of the ASR agreement, the financial
institution delivers additional shares. The total number of shares
S&P Global 2022 Annual Report 83
ultimately delivered, and therefore the average price paid per
share, is determined at the end of the applicable purchase period
of each ASR agreement based on the volume weighted-average
share price, less a discount. We account for our ASR agreements
as two transactions: a stock purchase transaction and a forward
stock purchase contract. The shares delivered under the ASR
agreements resulted in a reduction of outstanding shares used
to determine our weighted average common shares outstanding
(in millions, except average price)
for purposes of calculating basic and diluted earnings per share.
The repurchased shares are held in Treasury. The forward stock
purchase contracts were classified as equity instruments.
The terms of each ASR agreement entered into for the years
ended December 31, 2022, 2021 and 2020, structured as outlined
above, are as follows:
ASR Agreement
Initiation
Date
ASR Agreement
Completion
Date
Initial
Shares
Delivered
Additional
Shares
Delivered
Total Number
of Shares
Purchased
Average
Price Paid
Per Share
December 2, 2022 1
August 9, 2022 2
October 25, 2022
May 13, 2022 3
March 1, 2022 4
February 11, 2020 5
February 11, 2020 6
August 2, 2022
August 9, 2022
July 27, 2020
July 27, 2020
2.4
5.8
3.8
15.2
1.3
1.4
—
1.6
0.6
4.1
0.4
0.3
2.4
7.4
4.4
19.3
1.7
1.7
$—
$337.94
$343.85
$362.03
$292.13
$292.13
Total
Cash
Utilized
$1,000
$2,500
$1,500
$7,000
$500
$500
1
2
3
4
5
6
The ASR agreement was structured as an uncapped ASR agreement in which we paid $1 billion and initially received shares valued at 87.5% of the $1 billion at a
price equal to the market price of the Company’s common stock on December 2, 2022 when the Company received an initial delivery of 2.4 million shares from the
ASR program. We completed the ASR agreement on February 3, 2023 and received an additional 0.4 million shares. We repurchased a total of 2.8 million shares
under the ASR agreement for an average purchase price $350.74 per share. The ASR agreement was executed under our 2022 Repurchase Program.
The ASR agreement was structured as an uncapped ASR agreement in which we paid $2.5 billion and initially received shares valued at 87.5% of the $2.5 billion
at a price equal to the market price of the Company’s common stock on August 9, 2022 when the Company received an initial delivery of 5.8 million shares from the
ASR program. We completed the ASR agreement on October 25, 2022 and received an additional 1.6 million shares. The ASR agreement was executed under our
2022 and 2020 Repurchase Program.
The ASR agreement was structured as an uncapped ASR agreement in which we paid $1.5 billion and initially received shares valued at 85% of the $1.5 billion at
a share price equal to the market price of the Company’s common stock on May 13, 2022 when the Company received an initial delivery of 3.8 million shares from
the ASR program. We completed the ASR agreement on August 2, 2022 and received an additional 0.6 million shares. The ASR agreement was executed under our
2020 Repurchase Program.
The ASR agreement was structured as an uncapped ASR agreement in which we paid $7 billion and initially received shares valued at 85% of the $7 billion at a
share equal to the then market price of the Company’s common stock on March 1, 2022 when the company received an initial delivery of 15.2 million shares from
the ASR program. We completed the ASR agreement on August 9, 2022 and received an additional 4.1 million shares. The ASR agreement was executed under our
2020 Repurchase Program.
The ASR agreement was structured as a capped ASR agreement in which we paid $500 million and received an initial delivery of 1.3 million shares and an
additional amount of 0.2 million in February 2020, representing a minimum number of shares of our common stock to be repurchased based on a calculation using
a specified capped price per share. We completed the ASR agreement on July 27, 2020 and received an additional 0.2 million shares. The ASR agreement was
executed under our 2013 Repurchase Program.
The ASR agreement was structured as an uncapped ASR agreement in which we paid $500 million and received an initial delivery of 1.4 million shares,
representing 85% of the $500 at a price equal to the then market price of the Company. We completed the ASR agreement on July 27, 2020 and received an
additional 0.3 million shares. The ASR agreement was executed under our 2013 Repurchase Program.
Additionally, during the year ended December 31, 2020, we purchased shares of our common stock in the open market as follows:
(in millions, except average price)
Year Ended
Total number of shares
purchased
Average price paid
per share
Total cash utilized
December 31, 2020
0.5
$295.40
$161
During the year ended December 31, 2022, we purchased a total
of 33.5 million shares for $12.0 billion of cash. During the year
ended December 31, 2021, we did not use cash to purchase any
shares. During the year ended December 31, 2020, we purchased
a total of 4.0 million shares for $1,161 million of cash. During the
fourth quarter of 2019, we repurchased shares for $3 million,
which settled in the first quarter of 2020, resulting in $1,164
million of cash used to repurchase shares.
84 S&P Global 2022 Annual Report
Redeemable Noncontrolling Interests
The agreement with the minority partners that own 27% of our
S&P Dow Jones Indices LLC joint venture contains redemption
features whereby interests held by minority partners are
redeemable either (i) at the option of the holder or (ii) upon the
occurrence of an event that is not solely within our control.
Specifically, under the terms of the operating agreement of
S&P Dow Jones Indices LLC, CME Group and CME Group Index
Services LLC (“CGIS”) has the right at any time to sell, and we are
obligated to buy, at least 20% of their share in S&P Dow Jones
Indices LLC. In addition, in the event there is a change of control
of the Company, for the 15 days following a change in control,
CME Group and CGIS will have the right to put their interest to us
at the then fair value of CME Group’s and CGIS’ minority interest.
If interests were to be redeemed under this agreement, we
would generally be required to purchase the interest at fair
value on the date of redemption. This interest is presented on
the consolidated balance sheets outside of equity under the
caption “Redeemable noncontrolling interest” with an initial
value based on fair value for the portion attributable to the net
assets we acquired, and based on our historical cost for the
portion attributable to our S&P Index business. We adjust the
(in millions)
Balance as of December 31, 2021
Net income attributable to redeemable noncontrolling interest
Equity contribution from redeemable noncontrolling intrerest
Distributions to noncontrolling interest
Redemption value adjustment
Other 1
Balance as of December 31, 2022
1
Relates to foreign currency translation adjustments
On June 1, 2022 the Company contributed its interest in the
IHSM Indices acquired as part of the Merger to S&P Dow Jones
Indices LLC. The IHSM Indices will be operated, managed, and
distributed by S&P Dow Jones Indices LLC. CME Group paid the
Company $410 million in exchange for both a 27% ownership
of IHSM’s Indices and to maintain their 27% proportionate
ownership in the S&P Dow Jones Indices LLC joint venture.
redeemable noncontrolling interest each reporting period to its
estimated redemption value, but never less than its initial fair
value, using both income and market valuation approaches. Our
income and market valuation approaches may incorporate Level
3 fair value measures for instances when observable inputs are
not available. The more significant judgmental assumptions
used to estimate the value of the S&P Dow Jones Indices LLC
joint venture include an estimated discount rate, a range of
assumptions that form the basis of the expected future net cash
flows (e.g., the revenue growth rates and operating margins),
and a company specific beta. The significant judgmental
assumptions used that incorporate market data, including the
relative weighting of market observable information and the
comparability of that information in our valuation models, are
forward-looking and could be affected by future economic and
market conditions. Any adjustments to the redemption value will
impact retained income.
Noncontrolling interests that do not contain such redemption
features are presented in equity.
Changes to redeemable noncontrolling interest during the year
ended December 31, 2022 were as follows:
$3,429
249
410
(278)
(545)
2
$3,267
Accumulated Other Comprehensive Loss
The following table summarizes the changes in the components
of accumulated other comprehensive loss for the year ended
December 31, 2022:
(in millions)
Balance as of December 31, 2021
Other comprehensive (loss) income before
reclassifications
Reclassifications from accumulated other
comprehensive income (loss) to net earnings
Net other comprehensive gain (loss) income
Balance as of December 31, 2022
Foreign
Currency
Translation
Adjustments 1, 3
Pension and
Postretirement
Benefit
Plans 2
Unrealized Gain
(Loss) on Cash
Flow Hedges 3
Accumulated
Other
Comprehensive
Loss
$(336)
(250)
4
(246)
$(582)
$(305)
$(200)
$(841)
(53)
9 2
(44)
$(349)
236
9 3
245
$45
(67)
22
(45)
$(886)
1
2
Includes an unrealized gain related to our cross currency swaps. See note 6 – Derivative Instruments for additional detail of items recognized in accumulated
other comprehensive loss.
Reflects amortization of net actuarial losses and is net of a tax benefit of $2 million for the year ended December 31, 2022. See Note 7 — Employee Benefits for
additional details of items reclassed from accumulated other comprehensive loss to net earnings.
3
See Note 6 – Derivative Instruments for additional details of items reclassified from accumulated other comprehensive loss to net earnings.
S&P Global 2022 Annual Report 85
10. Earnings per Share
Basic earnings per common share (“EPS”) is computed by
dividing net income attributable to the common shareholders
of the Company by the weighted-average number of common
shares outstanding. Diluted EPS is computed in the same
manner as basic EPS, except the number of shares is increased
The calculation for basic and diluted EPS is as follows:
to include additional common shares that would have been
outstanding if potential common shares with a dilutive effect had
been issued. Potential common shares consist primarily of stock
options and restricted performance shares calculated using the
treasury stock method.
(in millions, except per share data)
2022
2021
2020
Year ended December 31,
Amount attributable to S&P Global Inc. common shareholders:
Net income
Basic weighted-average number of common shares outstanding
Effect of stock options and other dilutive securities
Diluted weighted-average number of common shares outstanding
Earnings per share attributable to S&P Global Inc. common shareholders:
Net income:
Basic
Diluted
$3,248
316.9
1.6
318.5
$3,024
240.8
1.0
241.8
$2,339
241.0
1.1
242.1
$10.25
$10.20
$12.56
$12.51
$9.71
$9.66
We have certain stock options and restricted performance
shares that are potentially excluded from the computation of
diluted EPS. The effect of the potential exercise of stock options
is excluded when the average market price of our common stock
is lower than the exercise price of the related option during the
period or when a net loss exists because the effect would have
been antidilutive. Additionally, restricted performance shares
are excluded because the necessary vesting conditions had not
been met or when a net loss exists. As of December 31, 2022,
2021 and 2020, there were no stock options excluded. Restricted
performance shares outstanding of 0.6 million as of December
31, 2022, 0.5 million as of December 31, 2021 and 0.4 million as
of December 31, 2020, respectively, were excluded.
86 S&P Global 2022 Annual Report
11. Restructuring
We continuously evaluate our cost structure to identify cost
savings associated with streamlining our management structure.
Our 2022 and 2021 restructuring plans consisted of company-
wide workforce reductions of approximately 1,440 and 30
positions, respectively, and are further detailed below. The
charges for each restructuring plan are classified as selling and
general expenses within the consolidated statements of income
and the reserves are included in other current liabilities in the
consolidated balance sheets.
In certain circumstances, reserves are no longer needed because
employees previously identified for separation resigned from
the Company and did not receive severance or were reassigned
due to circumstances not foreseen when the original plans
were initiated. In these cases, we reverse reserves through the
consolidated statements of income during the period when it is
determined they are no longer needed.
The initial restructuring charge recorded and the ending reserve
balance as of December 31, 2022 by segment is as follows:
(in millions)
Market Intelligence
Ratings
Commodity Insights
Mobility
Indices
Engineering Solutions
Corporate
Total
2022 Restructuring Plan
2021 Restructuring Plan
Initial Charge
Recorded
Ending Reserve
Balance
Initial Charge
Recorded
Ending Reserve
Balance
$86
26
45
2
13
2
109
$283
$59
17
25
2
11
1
49
$164
$3
3
—
—
—
—
13
$19
$2
2
—
—
—
—
6
$10
For the year ended December 31, 2022, we recorded a pre-
tax restructuring charge of $283 million primarily related to
employee severance charges for the 2022 restructuring plan and
have reduced the reserve by $119 million. For the year ended
December 31, 2022, we have reduced the reserve for the 2021
restructuring plan by $9 million. The reductions primarily related
to cash payments for employee severance charges.
S&P Global 2022 Annual Report 87
12. Segment and
Geographic Information
As discussed in Note 1 – Accounting Policies, we have six
reportable segments: Market Intelligence, Ratings, Commodity
Insights, Mobility, Indices, and Engineering Solutions.
Our Chief Executive Officer is our chief operating decision-maker
and evaluates performance of our segments and allocates
resources based primarily on operating profit. Segment
operating profit does not include Corporate Unallocated expense,
equity in income on unconsolidated subsidiaries, other income,
net, interest expense, net, or loss on extinguishment of debt as
these are amounts that do not affect the operating results of our
reportable segments. We use the same accounting policies for
our segments as those described in Note 1 – Accounting Policies.
A summary of operating results for the years ended December
31 is as follows:
Revenue
(in millions)
2022
2021
2020
Market Intelligence
$3,811
$2,185
$2,046
Ratings
Commodity Insights
Mobility
Indices
Engineering Solutions
Intersegment elimination 1
3,050
1,685
1,142
1,339
323
(169)
4,097
1,012
—
1,149
—
(146)
3,606
938
—
989
—
(137)
Total revenue
$11,181
$8,297
$7,442
Operating Profit
(in millions)
Market Intelligence 2
Ratings 3
Commodity Insights 4
Mobility 5
Indices 6
Engineering Solutions 7
2022
2021
2020
$2,488
1,672
$676
2,629
$569
2,223
591
213
927
15
544
—
798
—
478
—
666
—
Total reportable segments
5,906
4,647
3,936
Corporate Unallocated expense 8
(989)
(426)
(319)
Equity in Income on
unconsolidated subsidiaries 9
27
—
—
Total operating profit
$4,944
$4,221
$3,617
1
2
Revenue for Ratings and expenses for Market Intelligence include an
intersegment royalty charged to Market Intelligence for the rights to use and
distribute content and data developed by Ratings.
Operating profit for the year ended December 31, 2022 includes a gain on
dispositions of $1.8 billion, employee severance charges of $90 million,
IHS Markit merger costs of $35 million and acquisition-related costs of $2
million. Operating profit for the year ended December 31, 2021 includes
employee severance charges of $3 million, a gain on disposition of $3
88 S&P Global 2022 Annual Report
3
4
5
6
7
8
million, acquisition-related costs of $2 million and lease-related costs of
$1 million. Operating profit for the year ended December 31, 2020 includes
employee severance charges of $27 million, a gain on dispositions of $12
million and lease-related costs of $3 million. Additionally, operating profit
includes amortization of intangibles from acquisitions of $474 million, $65
million, and $76 million for the years ended December 31, 2022, 2021, and
2020, respectively.
Operating profit for the year ended December 31, 2022 includes employee
severance charges of $24 million, legal costs of $5 million and an asset
write-off of $1 million. Operating profit for the year ended December 31,
2021 includes a gain on disposition of $6 million, recovery of lease-related
costs of $4 million and employee severance charges of $3 million. Operating
profit for the year ended December 31, 2020 includes a technology-related
impairment charge of $11 million, lease-related costs of $5 million and
employee severance charges of $4 million. Additionally, operating profit
includes amortization of intangibles from acquisitions of $7 million, $10
million and $7 million for the years ended December 31, 2022, 2021, and
2020, respectively.
Operating profit for the year ended December 31, 2022 includes employee
severance charges of $45 million and IHS Markit merger costs of $26
million. Operating profit for the year ended December 31, 2021 includes
recovery of lease-related costs of $2 million. Operating profit for the
year ended December 31, 2020 includes severance charges of $11 million
and lease-related costs of $2 million. Additionally, operating profit
includes amortization of intangibles from acquisitions of $111 million, $8
million, and $9 million for the years ended December 31, 2022, 2021, and
2020, respectively.
Operating profit for the year ended December 31, 2022 includes an
acquisition-related benefit of $14 million, employee severance charges
of $4 million, IHS Markit merger costs of $3 million and amortization of
intangibles from acquisitions of $241 million.
Operating profit for the year ended December 31, 2022 includes a gain on
disposition of $52 million, employee severance charges of $14 million and
IHS Markit merger costs of $2 million. Operating profit for the year ended
December 31, 2021 includes recovery of lease-related costs of $1 million.
Operating profit for the year ended December 31, 2020 includes employee
severance charges of $5 million, a lease impairment charge of $4 million,
a technology-related impairment charge of $2 million and lease-related
costs of $1 million. Additionally, operating profit includes amortization of
intangibles from acquisitions of $31 million, $6 million, and $6 million for the
years ended December 31, 2022, 2021, and 2020, respectively.
Operating profit for the year ended December 31, 2022 includes employee
severance charges of $4 million and amortization of intangibles from
acquisitions of $35 million.
Corporate Unallocated expense for the year ended December 31, 2022
includes IHS Markit merger costs of $553 million, a S&P Foundation grant
of $200 million, employee severance charges of $107 million, disposition-
related costs of $24 million, a gain on acquisition of $10 million, an asset
impairment of $9 million, acquisition-related costs of $8 million, lease
impairments of $5 million and an asset write-off of $3 million. Corporate
Unallocated expense for the year ended December 31, 2021 includes IHS
Markit merger costs of $249 million, employee severance charges of $13
million, lease-related costs of $4 million, a lease impairment of $3 million,
Kensho retention related expenses of $2 million, acquisition-related costs
of $2 million and a gain on disposition of $2 million. Corporate Unallocated
expense for the year ended December 31, 2020 includes lease impairments
of $116 million, IHS Markit merger costs of $24 million, employee severance
charges of $19 million, Kensho retention related expense of $12 million
and a gain related to an acquisition of $1 million. Additionally, Corporate
Unallocated expense includes amortization of intangibles from acquisitions
of $4 million, $7 million, and $26 million for the years ended December 31,
2022, 2021, and 2020, respectively.
9
Equity in Income on Unconsolidated Subsidiaries includes amortization
of intangibles from acquisitions of $55 million for the year ended
December 31, 2022.
The following table presents our revenue disaggregated by revenue type for the years ended December 31:
(in millions)
Market
Intelligence
Commodity
Ratings
Insights Mobility
Indices
Engineering
Solutions
Intersegment
Elimination 1
Total
Subscription
Non-subscription /
Transaction
Non-transaction
Asset-linked fees
Sales usage-based
royalties
Recurring variable
Total revenue
Timing of revenue
recognition
Services transferred at
a point in time
Services transferred
over time
$3,263
$—
$1,492
$888
$258
$300
$— $6,201
2022 1
163
—
—
—
1,241
1,809
—
—
126
254
—
—
67
—
—
—
—
—
862
219
385
$3,811
—
$3,050
—
$1,685
—
$1,142
—
$1,339
$163
$1,241
$126
$254
$—
3,648
1,809
1,559
888
1,339
23
—
—
—
—
$323
$23
300
— 1,807
(169)
1,640
—
—
862
286
—
385
$(169) $11,181
$— $1,807
(169)
9,374
Total revenue
$3,811
$3,050
$1,685
$1,142
$1,339
$323
$(169) $11,181
(in millions)
Market
Intelligence
Commodity
Ratings
Insights Mobility
Indices
Engineering
Solutions
Intersegment
Elimination 1
Total
$2,131
54
—
—
—
$—
2,253
1,844
—
—
2021 2
$933
13
—
—
66
$—
$191
$—
$— $3,255
—
—
—
—
—
—
800
158
—
—
—
—
— 2,320
(146)
1,698
—
—
800
224
$2,185
$4,097
$1,012
$— $1,149
$—
$(146)
$8,297
Total revenue
$2,185
$4,097
$1,012
$— $1,149
$54
$2,253
2,131
1,844
$13
999
$—
$—
—
1,149
$—
—
$—
$— $2,320
(146)
5,977
$(146)
$8,297
1
2
Intersegment eliminations mainly consists of a royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.
In the first quarter of 2022, the Market Intelligence Commodities business was transferred to the Commodity Insights segment and prior-year amounts have been
reclassified to conform with current presentation.
S&P Global 2022 Annual Report 89
Subscription
Non-subscription /
Transaction
Non-transaction
Asset-linked fees
Sales usage-based
royalties
Total revenue
Timing of revenue
recognition
Services transferred at
a point in time
Services transferred
over time
(in millions)
Market
Intelligence
Commodity
Ratings
Insights Mobility
Indices
Engineering
Solutions
Intersegment
Elimination 1
Total
Subscription
Non-subscription /
Transaction
Non-transaction
Asset-linked fees
Sales usage-based
royalties
Total revenue
Timing of revenue
recognition
$1,991
54
—
1
—
$—
1,969
1,637
—
—
2020 2
$869
7
—
—
62
$—
$177
$—
$— $3,037
—
—
—
—
—
—
647
165
—
—
—
—
— 2,030
(137)
1,500
—
—
648
227
$2,046
$3,606
$938
$—
$989
$—
$(137)
$7,442
Services transferred at
a point in time
Services transferred
over time
$54
$1,969
1,992
1,637
Total revenue
$2,046
$3,606
$7
931
$938
$—
—
$—
$—
989
$989
$—
—
$—
$— $2,030
(137)
5,412
$(137)
$7,442
1
2
Intersegment eliminations mainly consists of a royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.
In the first quarter of 2022, the Market Intelligence Commodities business was transferred to the Commodity Insights segment and prior-year amounts have been
reclassified to conform with current presentation.
Segment information for the years ended December 31 is as follows:
(in millions)
Market Intelligence
Ratings
Commodity Insights
Mobility
Indices
Engineering Solutions
Total reportable segments
Corporate
Total
Depreciation & Amortization
Capital Expenditures
2022
$509
46
115
248
39
35
992
21
$1,013
2021
$91
46
12
—
10
—
159
19
$178
2020
$101
40
17
—
9
—
167
39
$206
2022
2021
2020
$43
23
4
6
2
4
82
7
$89
$12
18
2
—
2
—
34
1
$35
$28
33
7
—
4
—
72
4
$76
90 S&P Global 2022 Annual Report
Segment information as of December 31 is as follows:
(in millions)
Market Intelligence
Ratings
Commodity Insights
Mobility
Indices
Engineering Solutions
Total reportable segments
Corporate 1
Assets of businesses held for sale 2
Total
Total Assets
2022
2021
$29,852
1,039
$3,368
1,248
8,781
13,416
3,271
—
56,359
4,127
1,298
$61,784
891
—
1,501
—
7,008
7,697
321
$15,026
1
2
Corporate assets consist principally of cash and cash equivalents, goodwill and other intangible assets, assets for pension benefits and deferred income taxes.
Includes Engineering Solutions as of December 31, 2022 and CGS and LCD as of December 31, 2021. See Note 2 – Acquisitions and Divestitures for
further discussion.
We do not have operations in any foreign country that represent more than 8% of our consolidated revenue. Transfers between
geographic areas are recorded at agreed upon prices and intercompany revenue and profit are eliminated. No single customer
accounted for more than 10% of our consolidated revenue.
The following provides revenue and long-lived assets by geographic region:
(in millions)
U.S.
European region
Asia
Rest of the world
Total
(in millions)
U.S.
European region
Asia
Rest of the world
Total
REVENUE
LONG-LIVED ASSETS
Year ended December 31,
2022
2021
2020
$6,653
2,597
1,246
685
$11,181
$5,012
1,995
874
416
$8,297
$4,504
1,769
782
387
$7,442
December 31,
2022
2021
$13,539
39,007
76
595
$53,217
$4,733
463
85
42
$5,323
REVENUE
LONG-LIVED ASSETS
Year ended December 31,
December 31,
2022
60%
23
11
6
100%
2021
60%
24
11
5
100%
2020
61%
24
10
5
100%
2022
26%
73
—
1
100%
2021
89%
9
2
—
100%
See Note 2 – Acquisitions and Divestitures and Note 11 – Restructuring, for actions that impacted the segment operating results.
S&P Global 2022 Annual Report 91
13. Commitments
and Contingencies
Leases
We determine whether an arrangement meets the criteria for
an operating lease or a finance lease at the inception of the
arrangement. We have operating leases for office space and
equipment. Our leases have remaining lease terms of 1 year to 11
years, some of which include options to extend the leases for up
to 14 years, and some of which include options to terminate the
leases within 1 year. We sublease certain real estate leases to
third parties which mainly consist of operating leases for space
within our offices.
Leases with an initial term of 12 months or less are not recorded
on the balance sheet; we recognize lease expenses for these
leases on a straight line-basis over the lease term in operating-
related expenses and selling and general expenses.
Operating lease ROU assets and operating lease liabilities are
recognized based on the present value of future minimum lease
payments over the lease term at commencement date. Our future
minimum based payments used to determine our lease liabilities
include minimum based rent payments and escalations. As
most of our leases do not provide an implicit rate, we use our
estimated incremental borrowing rate based on the information
available at commencement date in determining the present
value of lease payments. The February 28, 2022 merger with IHS
Markit resulted in an increase in ROU assets and operating lease
liabilities of $230 million and $268 million, respectively.
During the years ended December 31, 2022, 2021 and 2020,
we recorded a pre-tax impairment charge of $132 million, $31
million and $120 million, respectively, related to the impairment
and abandonment of operating lease related ROU assets. The
pre-tax impairment charge recorded during the year ended
December 31, 2022 was primarily associated with reductions
in the anticipated sublease income on vacated leased facilities
following the deterioration of local market conditions and
consolidating our real estate facilities following the merger with
IHS Markit. The impairment charges are included in selling and
general expenses within the consolidated statements of income.
The following table provides information on the location and
amounts of our leases on our consolidated balance sheets as of
December 31, 2022 and 2021:
2022
2021
The components of lease expense for the years ended December
31 are as follows:
(in millions)
Operating lease cost
Sublease income
Total lease cost
2022
$147
(5)
$142
2021
$124
(2)
$122
2020
$144
(6)
$138
Supplemental information related to leases for the years ended
December 31 are as follows:
(in millions)
2022
2021
2020
Cash paid for amounts included
in the measurement for operating
lease liabilities
Operating cash flows for operating
leases
Right of use assets obtained in
exchange for lease obligations
$159
$127
$137
Operating leases
6
29
8
Weighted-average remaining lease term and discount rate for our
operating leases as of December 31 are as follows:
Weighted-average remaining lease
term (years)
2022
2021
6.6
8.3
Weighted-average discount rate
3.17% 3.59%
Maturities of lease liabilities for our operating leases
are as follows:
(in millions)
2023
2024
2025
2026
2027
(in millions)
Balance Sheet Location
Assets
Right of use assets
Liabilities
Lease right-of-use
assets
$423
$426
2028 and beyond
Total undiscounted lease payments
Less: Imputed interest
Present value of lease liabilities
Other current liabilities Current lease
118
96
liabilities
Lease liabilities —
non-current
Non-current lease
liabilities
577
492
92 S&P Global 2022 Annual Report
$138
114
102
88
82
261
$785
90
$695
Moreover, various government and self-regulatory agencies
frequently make inquiries and conduct investigations into our
compliance with applicable laws and regulations, including those
related to ratings activities, antitrust matters and other matters,
such as ESG. For example, as a nationally recognized statistical
rating organization registered with the SEC under Section
15E of the Exchange Act, S&P Global Ratings is in ongoing
communication with the staff of the SEC regarding compliance
with its extensive obligations under the federal securities laws.
Although S&P Global seeks to promptly address any compliance
issues that it detects or that the staff of the SEC or another
regulator raises, there can be no assurance that the SEC or
another regulator will not seek remedies against S&P Global for
one or more compliance deficiencies. Any of these proceedings,
investigations or inquiries could ultimately result in adverse
judgments, damages, fines, penalties or activity restrictions,
which could adversely impact our consolidated financial
condition, cash flows, business or competitive position.
In view of the uncertainty inherent in litigation and government
and regulatory enforcement matters, we cannot predict
the eventual outcome of such matters or the timing of their
resolution, or in most cases reasonably estimate what the
eventual judgments, damages, fines, penalties or impact of
activity (if any) restrictions may be. As a result, we cannot provide
assurance that such outcomes will not have a material adverse
effect on our consolidated financial condition, cash flows,
business or competitive position. As litigation or the process
to resolve pending matters progresses, as the case may be,
we will continue to review the latest information available and
assess our ability to predict the outcome of such matters and
the effects, if any, on our consolidated financial condition, cash
flows, business or competitive position, which may require that
we record liabilities in the consolidated financial statements in
future periods.
Related Party Agreement
In June of 2012, we entered into a license agreement (the
“License Agreement”) with the holder of S&P Dow Jones Indices
LLC noncontrolling interest, CME Group, which replaced the
2005 license agreement between Indices and CME Group. Under
the terms of the License Agreement, S&P Dow Jones Indices
LLC receives a share of the profits from the trading and clearing
of CME Group’s equity index products. During the years ended
December 31, 2022, 2021 and 2020, S&P Dow Jones Indices LLC
earned $170 million, $139 million and $149 million of revenue
under the terms of the License Agreement, respectively. The
entire amount of this revenue is included in our consolidated
statement of income and the portion related to the 27%
noncontrolling interest is removed in net income attributable to
noncontrolling interests.
Legal & Regulatory Matters
In the normal course of business both in the United
States and abroad, the Company and its subsidiaries are
defendants in a number of legal proceedings and are often
subjected to government and regulatory proceedings,
investigations and inquiries.
On November 14, 2022, S&P Global Ratings reached a settlement
with the SEC to resolve an SEC investigation into violations of
Section 15E of the Exchange Act and Rule 17g-5(c)(8) thereunder
involving the ratings assigned to a single residential mortgage-
backed securities transaction in 2017. The investigation was
previously disclosed. S&P Global Ratings did not admit or deny
the SEC’s allegations. In the SEC’s order, the SEC acknowledged
S&P Global Ratings’ remedial acts and its cooperation with the
SEC staff. As part of the resolution, the Company agreed to pay a
penalty of $2.5 million that was previously reserved for in 2021.
A class action lawsuit was filed in Australia on August 7, 2020
against the Company and a subsidiary of the Company. A
separate lawsuit was filed against the Company and a subsidiary
of the Company in Australia on February 2, 2021 by two entities
within the Basis Capital investment group. The lawsuits both
relate to alleged investment losses in collateralized debt
obligations rated by Ratings prior to the financial crisis. We
can provide no assurance that we will not be obligated to pay
significant amounts in order to resolve these matters on terms
deemed acceptable.
From time to time, the Company receives customer complaints,
particularly, though not exclusively, in its Ratings and Indices
segments. The Company believes it has strong contractual
protections in the terms and conditions included in its
arrangements with customers. Nonetheless, in the interest
of managing customer relationships, the Company from time
to time engages in dialogue with such customers in an effort
to resolve such complaints, and if such complaints cannot be
resolved through dialogue, may face litigation regarding such
complaints. The Company does not expect to incur material
losses as a result of these matters.
S&P Global 2022 Annual Report 93
Report of Management
To the Shareholders of S&P Global Inc.
Management’s Annual Report on its Responsibility for the Company’s
Financial Statements and Internal Control Over Financial Reporting
The financial statements in this report were prepared by the management of S&P Global Inc., which is
responsible for their integrity and objectivity.
These statements, prepared in conformity with accounting principles generally accepted in the United States
and including amounts based on management’s best estimates and judgments, present fairly S&P Global
Inc.’s financial condition and the results of the Company’s operations. Other financial information given in this
report is consistent with these statements.
The Company’s management is responsible for establishing and maintaining adequate internal control
over financial reporting for the Company as defined under the U.S. Securities Exchange Act of 1934. It
further assures the quality of the financial records in several ways: a program of internal audits, the careful
selection and training of management personnel, maintaining an organizational structure that provides an
appropriate division of financial responsibilities, and communicating financial and other relevant policies
throughout the Company.
S&P Global Inc.’s Board of Directors, through its Audit Committee, composed entirely of outside directors, is
responsible for reviewing and monitoring the Company’s financial reporting and accounting practices. The
Audit Committee meets periodically with management, the Company’s internal auditors and the independent
registered public accounting firm to ensure that each group is carrying out its respective responsibilities. In
addition, the independent registered public accounting firm has full and free access to the Audit Committee
and meet with it with no representatives from management present.
Management’s Report on Internal Control Over Financial Reporting
As stated above, the Company’s management is responsible for establishing and maintaining adequate
internal control over financial reporting. The Company’s management has evaluated the system of internal
control using the Committee of Sponsoring Organizations of the Treadway Commission 2013 framework
(“COSO 2013 framework”). Management has selected the COSO 2013 framework for its evaluation as it
is a control framework recognized by the Securities and Exchange Commission and the Public Company
Accounting Oversight Board that is free from bias, permits reasonably consistent qualitative and quantitative
measurement of the Company’s internal controls, is sufficiently complete so that relevant controls are not
omitted and is relevant to an evaluation of internal controls over financial reporting.
Based on management’s evaluation under this framework, we have concluded that the Company’s internal
controls over financial reporting were effective as of December 31, 2022. There are no material weaknesses in
the Company’s internal control over financial reporting that have been identified by management.
The Company’s independent registered public accounting firm, Ernst & Young LLP, has audited the
consolidated financial statements of the Company for the year ended December 31, 2022, and has issued
their reports on the financial statements and the effectiveness of internal controls over financial reporting.
Other Matters
There have been no changes in the Company’s internal controls over financial reporting during the most
recent quarter that have materially affected, or are reasonably likely to materially affect, the Company’s
internal control over financial reporting.
Douglas L. Peterson
President and Chief Executive Officer
Ewout L. Steenbergen
Executive Vice President and Chief Financial Officer
94 S&P Global 2022 Annual Report
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of
Directors of S&P Global Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance
sheets of S&P Global Inc. (the Company) as of December 31,
2022 and 2021, the related consolidated statements of income,
comprehensive income, equity and cash flows for each of the
three years in the period ended December 31, 2022, and the
related notes (collectively referred to as the “consolidated
financial statements”). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial
position of the Company at December 31, 2022 and 2021, and the
results of its operations and its cash flows for each of the three
years in the period ended December 31, 2022, in conformity with
U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting
as of December 31, 2022, based on criteria established in
Internal Control-Integrated Framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission (2013
framework), and our report dated February 9, 2023 expressed an
unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the
Company’s management. Our responsibility is to express an
opinion on the Company’s financial statements based on our
audits. We are a public accounting firm registered with the
PCAOB and are required to be independent with respect to the
Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of
the PCAOB. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement, whether
due to error or fraud. Our audits included performing procedures
to assess the risks of material misstatement of the financial
statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures
included examining, on a test basis, evidence regarding the
amounts and disclosures in the financial statements. Our
audits also included evaluating the accounting principles used
and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements.
We believe that our audits provide a reasonable basis
for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters
arising from the current period audit of the financial statements
that were communicated or required to be communicated to the
audit committee and that: (1) relate to accounts or disclosures
that are material to the financial statements and (2) involved our
especially challenging, subjective or complex judgments. The
communication of critical audit matters does not alter in any
way our opinion on the consolidated financial statements, taken
as a whole, and we are not, by communicating the critical audit
matters below, providing separate opinions on the critical audit
matters or on the accounts or disclosures to which they relate.
S&P Global 2022 Annual Report 95
Valuation of redeemable noncontrolling interest in S&P Dow Jones Indices LLC
DESCRIPTION
OF THE
MATTER
As described in Notes 1 and 9 to the financial statements, the Company has an agreement with the minority
partners of its S&P Dow Jones Indices LLC joint venture that contains redemption features outside of the control
of the Company. This arrangement is reported as a redeemable noncontrolling interest at fair value of $3,267
million at December 31, 2022. The Company adjusts the redeemable noncontrolling interest each reporting
period to its estimated redemption value, but never less than its initial fair value, using both income and market
valuation approaches.
Auditing the Company’s valuation of its redeemable noncontrolling interest was complex due to the estimation
uncertainty in determining the fair value. The estimation uncertainty was primarily due to the sensitivity of
the fair value to underlying assumptions about the future performance of the business. The more significant
judgmental assumptions used to estimate the value of the S&P Dow Jones Indices LLC joint venture include
an estimated discount rate, a range of assumptions that form the basis of the expected future net cash flows
(e.g., revenue growth rates and operating margins), a company specific beta and earnings and transaction
multiples for comparable companies and similar acquisitions, respectively. These significant judgmental
assumptions that incorporate market data are forward-looking and could be affected by future economic and
market conditions.
HOW WE
ADDRESSED
THE MATTER
IN OUR AUDIT
We obtained an understanding, evaluated the design, and tested the operating effectiveness of the Company’s
controls over the accounting for its redeemable noncontrolling interest, including controls over management’s
judgments and evaluation of the underlying assumptions with regard to the valuation models applied and the
estimation process supporting the determination of the fair value of S&P Dow Jones Indices LLC joint venture.
To test the valuation of redeemable noncontrolling interest, we evaluated the Company’s selection of the
valuation methodology and the methods and significant assumptions used by inspecting available market data
and performing sensitivity analyses. For example, when evaluating the assumptions related to the revenue
growth rate and operating profit margins, we compared the assumptions to the past performance of S&P Dow
Jones Indices LLC joint venture in addition to current observable industry, market and economic trends. We
involved valuation specialists to assist in our evaluation of the methodology and significant assumptions used
by the Company, including the discount rate, company specific beta and earnings for comparable companies
and transaction multiples for similar acquisitions. We also tested the completeness and accuracy of the
underlying data supporting the significant assumptions and estimates.
96 S&P Global 2022 Annual Report
IHS Markit Business Combination
DESCRIPTION
OF THE
MATTER
HOW WE
ADDRESSED
THE MATTER
IN OUR AUDIT
As discussed in Note 2 to the consolidated financial statements, on February 28, 2022, the Company completed
its acquisition of IHS Markit Ltd., for aggregate consideration of $43.5 billion. This transaction was accounted for
as a business combination. Auditing the Company’s accounting for its acquisition of IHS Markit Ltd. was complex
due to the significant estimation in the Company’s determination of fair value of identified intangible assets
of $18.6 billion, which principally consisted of customer relationships, trademark/tradenames, developed
technology, and databases (collectively referred to as the identified intangibles). The significant estimation
was primarily due to the sensitivity of the fair value of underlying assumptions about future performance of the
acquired business in the Company’s discounted cash flow models used to measure the identified intangibles.
These significant assumptions included the revenue and expense growth rates that form the basis of the
forecasted results and the discount rate.
We tested the Company’s controls that address the risk of material misstatement relating to the Company’s
accounting for the acquisition. For example, we tested controls over the estimation process supporting the
recognition and measurement of the identified intangibles, which included testing controls over management’s
review of assumptions used in its respective valuation models to test the estimated fair value of the
identified intangibles. We performed audit procedures that included, among others, evaluating the valuation
methodologies and significant assumptions used by the Company’s valuation specialist, and evaluating
the completeness and accuracy of the underlying data supporting the estimated fair value. We involved our
valuation specialists to assist with our evaluation of the methodologies used by the Company and significant
assumptions included in the fair value estimates, including testing the revenue and expense growth rates that
form the basis of the forecasted results and the discount rate. For example, we compared these significant
assumptions to current industry, market and economic trends, to assumptions used to value similar assets
in other acquisitions, to the historical results of the acquired business, and to the Company’s budgets and
forecasts, in addition to performing sensitivity analyses over these assumptions. We also evaluated the
adequacy of the Company’s disclosures included in Note 2 in relation to these acquisition matters.
/s/ ERNST & YOUNG LLP
We have served as the Company’s auditor since 1969.
New York, New York
February 9, 2023
S&P Global 2022 Annual Report 97
Report of Independent Registered Public Accounting Firm
Definition and Limitations of Internal
Control Over Financial Reporting
A company’s internal control over financial reporting is a process
designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control
over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts
and expenditures of the company are being made only in
accordance with authorizations of management and directors
of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use,
or disposition of the company’s assets that could have a material
effect on the financial statements.
Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods
are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
/s/ ERNST & YOUNG LLP
New York, New York
February 9, 2023
To the Shareholders and the Board of
Directors of S&P Global Inc.
Opinion on Internal Control Over Financial Reporting
We have audited S&P Global Inc.’s internal control over
financial reporting as of December 31, 2022, based on criteria
established in Internal Control—Integrated Framework issued
by the Committee of Sponsoring Organizations of the Treadway
Commission (2013 framework), (the COSO criteria). In our opinion,
S&P Global Inc. (the Company) maintained, in all material
respects, effective internal control over financial reporting as of
December 31, 2022, based on the COSO criteria.
We also have audited, in accordance with the standards of the
Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of the Company
as of December 31, 2022 and 2021, the related consolidated
statements of income, comprehensive income, equity and cash
flows for each of the three years in the period ended December
31, 2022, and the related notes and our report dated February 9,
2023 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining
effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over
financial reporting included in the accompanying Management’s
Annual Report on Internal Control Over Financial Reporting.
Our responsibility is to express an opinion on the Company’s
internal control over financial reporting based on our audit. We
are a public accounting firm registered with the PCAOB and
are required to be independent with respect to the Company
in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audit in accordance with the standards of the
PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective
internal control over financial reporting was maintained in all
material respects.
Our audit included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material
weakness exists, testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary
in the circumstances. We believe that our audit provides a
reasonable basis for our opinion.
98 S&P Global 2022 Annual Report
Shareholder Information
Annual Meeting of Shareholders
The 2023 annual meeting will be held at 8 a.m. EDT on
Wednesday, May 3, 2023 in a virtual-only online meeting.
Shareholders and guests may access the meeting online at
https://meetnow.global/MSWQYGX. Meeting access details
for shareholders and guests, and proxy voting information are
available at www.spglobal.com/proxy.
Stock Exchange Listing
Shares of our common stock are traded primarily on the
New York Stock Exchange. SPGI is the ticker symbol for
our common stock.
Investor Relations Web Site
Go to http://investor.spglobal.com to find:
– Management presentations
– Financial news releases
Overnight correspondence should be mailed to:
Computershare
150 Royall Street, Suite 101
Canton, MA 02021
Investor Center™ website to view and
manage shareholder account online:
www.computershare.com/investor
For shareholder assistance by telephone:
In the U.S. and Canada: 888-201-5538
Outside the U.S. and Canada: 201-680-6578
TDD for the hearing impaired: 800-490-1493
TDD outside the U.S. and Canada: 781-575-4592
E-mail address:
web.queries@computershare.com
– Financial reports, including the annual report, proxy
statement and SEC filings
Shareholder online inquiries:
https://www-us.computershare.com/investor/Contact
– Investor Fact Book
– Executive Committee
– Corporate governance documents
– Dividend and stock split history
– Stock quotes and charts
– Investor e-mail alerts
– RSS news feeds
Investor Kit
The Company’s investor kit includes the most recent Annual
Report, Proxy Statement, Form 10-Qs, Form 10-K, and earnings
release. These documents can be downloaded from the SEC
Filings & Reports section of the Company’s Investor Relations
Website at http://investor.spglobal.com.
Requests for printed copies, free of charge, can be e-mailed to
investor.relations@spglobal.com or mailed to Investor Relations,
S&P Global Inc., 55 Water Street, New York, NY 10041. Interested
parties can also call Investor Relations toll-free at 866-436-
8502 (domestic callers) or 212-438-2192 (international callers).
Transfer Agent and Registrar for Common Stock
Computershare is the transfer agent for S&P Global Inc.
Computershare maintains the records for the Company’s
registered shareholders and can assist with a variety of
shareholder related services.
Shareholder correspondence should be mailed to:
Computershare
P.O. Box 43078
Providence, RI 02940-3078
Direct Stock Purchase and Dividend Reinvestment Plan
This program offers a convenient, low-cost way to invest in
S&P Global’s common stock. Participants can purchase and
sell shares directly through the program, make optional cash
investments weekly, reinvest dividends, and send certificates
to the transfer agent for safekeeping. Interested investors can
view the prospectus and enroll online at www.computershare.
com/investor. To receive the materials by mail, contact
Computershare as noted above.
News Media Inquiries
Go to www.spglobal.com/press to view the latest Company news
and information or to submit an e-mail inquiry.
Certifications and S&P Global Inc. Form 10-K
We have filed the required certifications under Sections 302 and
906 of the Sarbanes-Oxley Act of 2002 as Exhibits 31.1, 31.2 and
32 to our Form 10-K for the year ended December 31, 2022.
The financial information included in this report was excerpted
from the Company’s Form 10-K for the year ended December 31,
2022, filed with the Securities and Exchange Commission
on February 10, 2023. Shareholders may access a complete
copy of the Form 10-K from the SEC Filings & Reports section
of the Company’s Investor Relations Website at
http://investor.spglobal.com.
S&P Global 2022 Annual Report 99
Board of Directors
Richard E. Thornburgh (C, E, N)
Non-Executive Chairman
of the Board
S&P Global Inc.
Marco Alverà (E, F, N)
Group Chief Executive
Officer
Tree Energy Solutions
Jacques Esculier (A, C)
Former Chairman & CEO
WABCO Holdings Inc.
Gay Huey Evans (A, C)
Chairman
London Metal Exchange
William D. Green (C, E, N)
Former CEO and Chairman
Accenture Plc
Stephanie C. Hill (C, N)
Executive Vice President,
Rotary and Mission
Systems
Lockheed Martin Corp.
Rebecca Jacoby (F, N)
Former Senior Vice
President, Operations
Cisco Systems, Inc.
Robert P. Kelly (C, E, N)
Former Chairman and CEO
The Bank of New York Mellon
Ian Paul Livingston (A, F)
Former Chairman
Currys
Deborah D. McWhinney (A, F)
Former Chief Executive
Officer of Global Enterprise
Payments
Citigroup Inc.
Maria R. Morris (A, E, F)
Former Executive
Vice President,
Global Employee Benefits
MetLife, Inc.
Douglas L. Peterson (E)
President and Chief
Executive Officer
S&P Global Inc.
Gregory Washington (A, C)
President
George Mason University
100 S&P Global 2022 Annual Report
A – Audit Committee
C – Compensation & Leadership Development Committee
E – Executive Committee
F – Finance Committee
N – Nominating & Corporate Governance Committee
Committee assignments as of March 1, 2023
Executive Committee
Douglas L. Peterson
President and Chief
Executive Officer
Ewout Steenbergen
Executive Vice President,
Chief Financial Officer
Martina L. Cheung
President, S&P Global Ratings
Executive Lead,
Sustainable1
Dan Draper
Chief Executive Officer,
S&P Dow Jones Indices
Adam Kansler
President,
S&P Global Market
Intelligence
Steven Kemps
Executive Vice President,
Chief Legal Officer
Swamy Kocherlakota
Executive Vice President,
Chief Information Officer
Nancy J. Luquette
Executive Vice President,
Chief Risk & Compliance
Officer
Dimitra Manis
Executive Vice President,
Chief Purpose Officer
Sally Moore
Executive Vice President,
Global Head of Strategy,
M&A and Partnerships
Saugata Saha
President,
S&P Global Commodity
Insights
Edouard Tavernier
President,
S&P Global Mobility
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104 S&P Global 2022 Annual Report
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New York, NY 10041
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