Trump push reignites debate over transparency, costs, and long-term focus in corporate disclosures
The US Securities and Exchange Commission (SEC) is weighing a major change that could reshape how global investors access corporate financial information.
At US President Donald Trump’s request, the SEC confirmed it is prioritizing a proposal to replace quarterly earnings reports with semiannual filings, according to CNBC.
Trump outlined the plan in a Truth Social post, saying companies “should no longer be forced to ‘Report’ on a quarterly basis” and that moving to twice-yearly reports would “save money, and allow managers to focus on properly running their companies.”
Reuters reported that Trump’s call aligns with arguments he first raised in 2018, when the SEC sought public feedback on similar changes but ultimately kept the quarterly system.
The debate reflects a long-standing divide.
Warren Buffett and JPMorgan Chase CEO Jamie Dimon wrote in a Wall Street Journal op-ed that “quarterly earnings guidance often leads to an unhealthy focus on short-term profits at the expense of long-term strategy, growth and sustainability.”
Hillary Clinton voiced similar concerns during her 2016 campaign, saying she was “deeply distressed about quarterly capitalism.”
Supporters of fewer reports argue that regulatory burdens have added to the decline in the number of public companies in the US, as reported by CNN.
However, advocates of the current system highlight the risks of reduced transparency.
Art Hogan, chief market strategist at B. Riley Wealth Management, told CNBC that “the pros of quarterly reporting outweigh the cons,” warning that waiting six months “would cause more difficulties than it would add benefits.”
Jill Fisch, a securities law professor at the University of Pennsylvania, told Reuters that delaying disclosures could harm efficiency, stating “our capital markets are the gold standard in the world for their efficiency and transparency.”
Some business leaders have backed Trump’s position.
Nasdaq CEO Adena Friedman wrote on LinkedIn that allowing companies to choose reporting frequency would cut “friction, burden and costs.”
Norway’s sovereign wealth fund and the Long-Term Stock Exchange have also supported semiannual reporting, according to Reuters.
Under current regulations, companies must report earnings quarterly, though guidance is voluntary. Rule changes could be approved by a majority vote at the SEC without congressional action.
Sarah Bianchi of Evercore ISI told CNBC that implementing such a shift would likely take six to 12 months.
While she noted that administrations have often steered SEC priorities, she cautioned that the agency has also maintained a level of independence.
International practices vary.
Companies listed in the UK and European Union are required to file semiannual reports but may provide quarterly updates voluntarily.
In contrast, Chinese companies must submit quarterly, semiannual, and annual results, while firms listed on the Hong Kong exchange report only every six months.
Hogan told CNBC that comparisons to Europe are misleading, arguing “the investor is better suited to having more information than less frequent information.”
