Two large voices in asset management are urging the Securities and Exchange Commission to preserve mandatory quarterly reporting for public securities issuers, arguing that allowing companies to opt for semiannual financial reporting could reduce transparency, weaken market efficiency and have unintended consequences extending into private markets.
The Investment Company Institute and Capital Group each submitted comment letters to the SEC opposing a key element of Chair Paul Atkins’ proposal to allow public companies to file interim financial reports semiannually instead of quarterly. While the industry group and the asset manager both endorsed the SEC’s broader goal of making public markets more attractive to issuers, they argued that the costs to investors would outweigh any reduction in reporting burdens.
The proposal is part of Atkins’ broader agenda to reduce regulatory burdens to encourage more companies to go public and remain public. Since taking office, Atkins has repeatedly argued that public markets have become less attractive as companies stay private longer, limiting ordinary investors’ access to corporate growth opportunities.
However, Atkins said during a May interview at the 2026 FINRA Annual Conference that he would “let the market decide” what reporting schedule it wants, due to the optionality provided by the SEC proposal.
The ICI stated that it shares those objectives but has concluded the proposal strikes the wrong balance.
“We strongly support the Commission’s goals of reducing unnecessary regulatory burdens on public companies and encouraging more companies to go (or stay) public,” the trade association’s letter stated. However, it also said the reduction in decision-useful information available to investors would outweigh the proposal’s potential benefits. Instead, according to the letter, the SEC should retain mandatory quarterly reporting while considering targeted reductions to the information required by Form 10-Q disclosure.
To support its position, the ICI surveyed 14 member firms representing roughly $6.1 trillion in U.S.-registered fund assets. Of those, 64% opposed the proposal, while nearly all respondents identified quarterly financial statements as the most valuable component of Form 10-Q filings for investment decisions. Management’s discussion and analysis ranked as the second-most-important disclosure, according to the comment letter.
Rather than allowing companies to choose different reporting schedules, the ICI argued that maintaining a consistent reporting cadence preserves comparability across issuers while avoiding greater information asymmetry and market volatility.
Capital Group echoed many of the same concerns, although it expressed stronger support for the SEC’s overall objectives.
The Los Angeles-based asset manager stated that reducing unnecessary reporting burdens and encouraging long-term decisionmaking are worthwhile goals. But because its investment teams rely on standardized public disclosures to evaluate companies, the firm warned that semiannual reporting could reduce market efficiency by limiting access to comparable financial information.
The firm argued that companies choosing semiannual reporting would likely continue issuing quarterly earnings releases, but those disclosures would not provide investors with the same level of information contained in Form 10-Q filings.
According to Capital Group’s letter, earnings releases are generally less standardized, are furnished by the companies rather than filed with the SEC, are not subject to independent accountant review, and frequently rely on non-GAAP measures. By contrast, Form 10-Q filings provide the detailed financial disclosures and standardized information investors use to evaluate earnings quality, accounting judgments and company performance across issuers.
Capital Group also raised a concern that has received comparatively little attention during the rulemaking process: spillover effects into private markets.
According to the firm, investors frequently use public-company reporting standards as a benchmark when negotiating financial reporting requirements from private companies, particularly private debt issuers. If quarterly reporting becomes optional for public companies, private issuers may also move toward semiannual reporting, reducing the information available to investors in the private credit and high-yield debt markets. Over time, the firm argued, that could affect capital allocation, risk assessment and price discovery across broader capital markets.
Like the ICI, Capital Group suggested the SEC should consider streamlining Form 10-Q disclosure requirements instead of reducing reporting frequency. Commissioner Hester Peirce raised a similar possibility when the proposal was released, asking whether the agency should focus on slimming down quarterly reports, rather than making them optional.
The comment period concluded on July 6.
Tags: SEC