President Donald Trump said he's asked the Securities and Exchange Commission to study ending quarterly reporting for US businesses in order to ease regulations and spur growth.
In a tweet early today, Trump said that after speaking with several top business leaders, he's asking the Securities and Exchange Commission to determine whether shifting to a six-month reporting requirement would help companies grow faster and create more jobs.
Nooyi issued a statement on Friday about the conversation with the president, saying that many market participants "have been discussing how to better orient corporations to have a more long-term view".
Trump has asked SEC regulators to consider a switching from quarterly reporting requirements to semi-annual.
President Trump has instructed the American markets watchdog to investigate ending the quarterly reporting requirement for public companies that has been in place for almost 50 years. One provision of the bill includes a requirement that the SEC review the quarterly reporting requirement.
"My comments were made in that broader context, and included a suggestion to explore the harmonization of the European system and the US system of financial reporting". While some business leaders have groaned about the rigors associated with having to meet targets and metrics four times a year, the SEC has been reticent to make any changes. "In the end, all companies have to balance short-term and long-term performance". They found that long-term investments declined at companies that were required to step up the frequency of their reporting.
While Trump can not force Clayton to make changes, as a matter of courtesy the SEC chairman may promise to study the issue.
The SEC is an independent agency, and the president can not force it to implement rule changes. A spokeswoman for Chairman Jay Clayton did not respond to a request for comment.More news: V S Naipaul, Nobel victor and 'a literary circumnavigator,' dies at 85
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"We are looking at that very, very seriously".
Under Clayton, a Trump appointee, the SEC has taken steps to relax rules for issuers, including allowing firms going public to file information confidentially, and is now discussing easing other compliance rules.
Trump held a dinner for business executives on Aug 8, two days after Nooyi announced her departure, at his golf club in Bedminster, New Jersey.
But he said energy companies would probably still report some oil and gas well data every three months to please investors. Trump said in a Twitter post.
Quarterly financial reports are a staple of USA corporate practice.
"Investors need timely, accurate financial information to make informed investment decisions", Amy Borrus, deputy director of the Council of Institutional Investors, said in a statement.
It "also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term", Musk said.