Highlights

• Donald Trump urges a move to six-month corporate reporting.
• Climate-conscious investors believe fewer reports may help companies focus on long-term climate risks and strategy.
• Experts caution that the U.S. market would need safeguards to maintain transparency and protect shareholders.

U.S. President Donald Trump has urged American companies to release financial results every six months instead of the traditional quarterly reporting.

He joined prominent business figures such as Warren Buffett of Berkshire Hathaway and Jamie Dimon of JPMorgan in saying that frequent updates can push companies toward short-term profit chasing and away from plans that build long-term value.

International climate-focused investors, who often clash with Trump on environmental issues, gave this idea cautious approval. They say that quarterly updates encourage trading activity and shorten corporate planning horizons.

Read More: CSSB Releases Guide for Climate-First Sustainability Reporting

According to David Pitt-Watson of Cambridge University’s Judge Business School, longer gaps between reports could give company leaders more room to plan strategies that account for climate change and other long-range risks.

Several investors in Europe share this view. Nick Duncan from Aberdeen, which manages more than £500 billion, said that a six-month schedule could help firms plan for future challenges if transparency remains intact.

He added that less frequent reports would shorten the “closed period,” the time before results when investors cannot speak with company management, which often lasts about a month.

A shift in U.S. rules would align the country with Britain, the European Union, Australia, New Zealand, and Hong Kong, where half-yearly updates are standard.

Britain moved to this system over a decade ago. Andrew Ninian of the UK’s Investment Association said it has allowed companies there to focus on long-term strategy rather than short-term targets.

However, experts warn of potential risks for investor protection. Hayley Grafton of Edentree Investment Management pointed out that the United States lacks strict requirements for profit warnings or continuous disclosure of material information.

Also Read: 198 Signatories Back Strong EU Sustainability Rules in Joint Statement

Without new safeguards, investors might receive fewer timely updates, and the cost of capital could go up. Even with these concerns, Pitt-Watson suggested that fewer reports could help management concentrate on decisions that create real value.

Ends/

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Source: Reuters