US Treasury Secretary, Scott Payette, said that President Donald Trump’s proposal to companies on a semi -annual basis will be good news for investors.
Trump suggested canceling the quarterly profit reports in A. Social truth on MondaySaying that it will allow the company’s executives to focus on long -term goals instead of focusing on short -term standards.
“President Trump realizes that whether it is the United Kingdom, (or) is the United States, our public markets are a laugh, and this may be a way to restore and reduce the costs of public companies without harming investors,” Pisent told CNBC in London on Tuesday.
US Treasury Secretary Scott Bessin at CNBC Studios in London.
US Treasury Secretary Scott Bessin at CNBC Studios in London.
This comes as many companies choose to remain a private property, instead of the list publicly, partly due to the increase in the costs of checking and compliance every quarter. The number of companies listed for the public in the United States He fell From more than 7000 in 1996 to less than 4000 in 2020.
Trump also suggested that by canceling the quarterly reports that would bring the United States with many foreign judicial states that already follow the semi -annual reporting system.
Trump said: “Have you ever heard the statement that China has a view of 50 to 100 years about the management of a company, while we manage our companies on a quarterly basis ??? Not good !!!”
While the companies listed in China reports every quarter, the shares on the Hong Kong Stock Exchange are subject to reporting every six months.
In the UK and the European Union, corporate reports are also semi -annual, but they can issue quarterly reports if they choose it.
However, some investors have previously warned that quarterly profit reports help protect their interests by making financial companies more transparent and regular.
The CIA Council (CII), a group that represents Invested pension funds, suggest The lack of quarterly reports may not “sufficiently” protect investors.
Foreign companies listed in the United States under the diagram of foreign special source, such as arm and SpotifyAlso exempt from having to report a quarterly, but some are voluntary reports.
CII said that many of the exemptions enjoyed by foreign companies in the United States may “undermine” effective corporate governance.
Can the United States make more attractive?
European stock exchanges have witnessed a number of prominent companies that leave their home markets in the United States during the past decade, which are attracted by the highest levels of evaluation achieved by their American peers, along with some organizational benefits.
The distance from the quarterly reports of the American market may make more attractive to European companies because it will reduce compliance costs for those who think about this step.
“I don’t think this is a development that changes the game if it is implemented, but it will definitely come in a combination of considerations for a company that you think if it wants to include it in the United States,” said Mike Pinnefield, a lawyer who specializes in SEC compliance with Law Firm Lawlaters.
When asked whether this step would make the United States a more attractive destination for European companies, the Treasury Secretary said: “It is difficult to be popular.”
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