US regulators want to make corporate earnings reports less frequent, but investors have doubts

Filed 1h ago · Via The Conversation · The Buffoon Desk

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Kevin MacLeod · incompetech.com · CC BY 4.0

Photo: Darul Uloom Deoband, Uploaded by Owais Al Qarni · CC0 · via Wikimedia Commons

The Securities and Exchange Commission has proposed letting public companies disclose earnings every six months instead of quarterly, citing reduced compliance costs and a shift away from short-term thinking. The proposal has drawn more than 280,000 public comments, dwarfing the roughly 65,000 letters tallied across 417 rule proposals over thirty years, with over 99% in opposition.

Commenters, including retail investors, SIFMA, and Federated Hermes, warn that reduced transparency could raise companies' cost of capital, potentially offsetting the SEC's estimated $200,000 average annual savings per firm. The SEC's own Investor Advisory Committee found no strong evidence that short-termism is even a real problem worth solving.

With two Democratic commissioner seats vacant and a Republican seat about to open, the SEC has floated changing its own rules so the proposal could pass with just two votes. Chair Paul Atkins says the commission is moving ahead regardless.

The full dispatch is available from the source below.

✒ FROM THE EDITORIAL DESK

When the people who'd have to live under a rule write in by the hundreds of thousands to say don't do it, and the agency responds by figuring out how to pass it with fewer votes instead of more, that tells you where the weight of the argument actually sits. Quarterly reports have been annoying bean counters since 1970 and somehow the republic still stands. The only people who seem eager to hear less from public companies are the companies themselves, which is about the least surprising fact in this whole pile of letters.

Source: Read the original at The Conversation → Scored: Five Card Shuffle · Kevin MacLeod · CC BY 4.0

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