In a tweet this morning, President Trump said he had asked the Securities and Exchange Commission (SEC) to study changing required financial reporting for public companies from a quarterly system to reporting every six months.

In speaking with some of the world’s top business leaders I asked what it is that would make business (jobs) even better in the U.S. “Stop quarterly reporting & go to a six month system,” said one. That would allow greater flexibility & save money. I have asked the SEC to study!

— Donald J. Trump (@realDonaldTrump) August 17, 2018

The Council of Institutional Investors (CII) believes that public companies should continue to report quarterly on their financial performance. “Investors and other stakeholders benefit when regulations ensure that important information is promptly and transparently provided to the marketplace,” said Amy Borrus, CII’s deputy director. “Investors need timely, accurate financial information to make informed investment decisions.”

CII shares the view of the SEC’s Investor Advisory Committee that “the current degree, quality and frequency of disclosure for U.S. issuers overall is appropriate and a source of strength for the U.S. capital markets.” CII also generally supports the SEC’s outstanding proposal to delete redundant or overlapping disclosure requirements.
However, CII believes public companies should have flexibility on whether and how often to issue earnings guidance. CII supported a June 7 initiative by the Business Roundtable (BRT) to encourage companies to focus more on long-term performance by moving away from providing quarterly earnings per share guidance and potentially dropping such guidance in the future.

At that time, CII Executive Director Ken Bertsch expressed support for the BRT initiative in a Wall Street Journal op-ed by Jamie Dimon, chair and CEO of JPMorgan Chase and Business Roundtable chair, and Warren Buffett, chair of Berkshire Hathaway. “When companies are managed for the long term, it creates value for shareholders with long investment horizons,” Bertsch said. “Practices that encourage long-term thinking and investment create value for millions of Americans without sacrificing the transparency and accountability that investors deserve,” he said.