SEC's Proposal for Biannual Reporting Sparks Controversy Over Deregulation and Openness

The Securities and Exchange Commission (SEC) has unveiled plans to significantly revise disclosure obligations for publicly traded companies, following President Donald Trump’s recent call to replace quarterly earnings reports with a twice-yearly reporting system. On September 17, 2025, SEC Chair Paul Atkins stated that the agency is preparing an official proposal to move from quarterly to semiannual financial reporting, potentially ending the practice that has been in place since 1970 Preparing for the 2025 Proxy and Annual Reporting Season: Key Issues and Considerations | BakerHostetler [ 6 ]. Trump, posting on Truth Social on September 15, contended that this change would lower compliance expenses and allow executives to concentrate on long-term business strategies rather than short-term objectives SEC's Atkins Confirms Semiannual Reporting Proposal in Motion… [ 5 ].

The current system, which mandates public firms to submit Form 10-Qs every quarter, was introduced to improve market openness after the 1929 financial crash. Trump’s initiative has gained momentum under the SEC’s present leadership. Atkins characterized the update as part of broader efforts to ease regulations and make U.S. capital markets more appealing for IPOs and new listings Preparing for the 2025 Proxy and Annual Reporting Season: Key Issues and Considerations | BakerHostetler [ 6 ]. The SEC is reportedly working on a rulemaking proposal to do away with quarterly reports, but the process will still involve a period for public comments and a final commission vote.

Advocates of this shift, including certain business organizations and the Long-Term Stock Exchange (LTSE), believe that quarterly reporting encourages short-term thinking among company leaders, who may focus on meeting analyst forecasts rather than pursuing long-term objectives SEC's Atkins Confirms Semiannual Reporting Proposal in Motion… [ 5 ]. The LTSE has recently submitted a petition to the SEC to permit companies to report earnings every six months, while keeping the option for quarterly filings SEC's Atkins Confirms Semiannual Reporting Proposal in Motion… [ 5 ]. Supporters also point to the European Union and the UK, where reporting every six months is the norm, and companies may voluntarily provide quarterly updates Trump says companies should no longer be forced… [ 7 ].

Opponents argue that moving to less frequent reporting could reduce transparency and undermine trust among investors. Investment professionals, such as those at the CFA Institute, insist that quarterly financial disclosures are essential for timely risk identification and keeping investors well informed SEC's Atkins Confirms Semiannual Reporting Proposal in Motion… [ 5 ]. They warn that stretching out the reporting intervals could make it harder to detect warning signs like liquidity concerns or accounting issues, possibly increasing regulatory or legal risks Trump says companies should no longer be forced… [ 7 ]. SEC Chief Accountant Kurt Hohl recognized these concerns, emphasizing that the commission’s goal is to make disclosures simpler while ensuring strong investor protections Preparing for the 2025 Proxy and Annual Reporting Season: Key Issues and Considerations | BakerHostetler [ 6 ].

This SEC proposal is part of a wider initiative to simplify disclosure standards and reduce compliance demands. Atkins also highlighted other priorities, such as easing requirements for smaller companies, streamlining executive pay disclosures, and updating the process for shareholder proposals Preparing for the 2025 Proxy and Annual Reporting Season: Key Issues and Considerations | BakerHostetler [ 6 ]. These reforms align with Trump’s broader agenda to encourage more IPOs by lowering regulatory barriers to public market entry Preparing for the 2025 Proxy and Annual Reporting Season: Key Issues and Considerations | BakerHostetler [ 6 ].

The suggested changes face considerable challenges, including potential legal obstacles and pushback within the agency. Detractors claim the SEC does not have explicit legal authority to end quarterly reporting, and any new rule could be questioned under the Administrative Procedure Act Trump says companies should no longer be forced… [ 7 ]. Nonetheless, the Trump administration’s proactive involvement with regulatory bodies could accelerate the process, with the final outcome depending on the SEC’s ability to navigate procedural and legal hurdles.