WASHINGTON, D.C.— Benjamin Schiffrin, Director of Securities Policy for Better Markets, issued the following statement in connection with the filing of Better Markets’ letter to the Securities and Exchange Commission (SEC) requesting an extension of the comment period on the SEC’s proposal to allow public companies to provide material financial information to investors only twice a year instead of quarterly:
“Investors, especially retail investors, rely on quarterly reports to make informed investment decisions. They ensure that investors receive timely and frequent information about the companies in which they invest their hard-earned money. That is why the SEC has required companies to issue quarterly reports for over 50 years, and it is why a shift to semiannual reporting would fundamentally alter the relationship between companies and investors.
“The current comment period of sixty days is not enough time for the public to comment on a proposed change of this magnitude. When the Commission issued a request for comment regarding the possibility of revising quarterly reporting in 2018, it gave the public 90 days to provide comments. That request did not include a specific rule proposal that would permit semiannual reporting, was only 30 pages long, and did not include an economic analysis. Yet it provided a longer comment period than the SEC provided here, despite the current proposal spanning 279 pages with 58 requests for comment and a detailed economic analysis. A 60-day extension, for a total of 120 days to comment on the instant proposal, compared to 90 days to comment on the 2018 request for comment, would be reasonable.
“The SEC needs to provide enough time to hear from investors for whom quarterly reports matter. Indeed, it is particularly important that the SEC hear from retail investors because the proposal will disproportionately impact them. Institutional investors have the resources and relationships to obtain information on a continuous basis even absent quarterly reporting. Retail investors do not. Most retail investors lack any other way to obtain information about the public companies in which they may want to invest. So the proposal will disproportionately impact retail investors. It is essential that the SEC provide those investors with sufficient time to review the proposal and provide comments to the agency.”
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Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.
