One of Britain’s biggest investors has backed moves for companies to scrap what it calls “unnecessary quarterly reporting”.
Legal & General Investment Management (LGIM) has written to every company in the FTSE 100 index and the second-tier FTSE 250 to outline its support for recent rule changes removing the requirement on companies to disclose financial reports every three months. US companies do this as a matter of course, but critics on this side of the Atlantic have long argued it puts too much focus on short-term profits.
In the letter, LGIM’s chief executive, Mark Zinkula, says that “reporting which focuses on short-term performance is not necessarily conductive to building a sustainable business.
“Reducing the time spent on frequent reporting could help management to focus more on long-term strategies and articulate more on market dynamics and innovation drivers that will enhance their performance over time.
He added: “Some companies have already chosen to discontinue quarterly reports and we are supportive of their actions.” he adds.Reuse content