Donald Trump would like to abolish quarterly reports altogether. Companies should only submit interim financial statements every six months, the US president recently demanded on social media. „This saves money and allows managers to focus on properly running their companies", he wrote. Trump is not alone in this view. The debate over the overly short-term thinking of companies and investors keeps flaring up. Securities and Exchange Commission Chair Paul Atkins recently hinted at a loosening of the rules on CNBC, commenting that "in the interest of shareholders of publicly listed companies, the market (…) can decide what the appropriate frequency is.“

Investors, analysts, and investor protection advocates in Germany generally make the reporting requirements dependent on company size. Large corporations, according to the sentiment of market participants surveyed by Börsen-Zeitung, should stick to quarterly reports on their business performance. Medium-sized and small companies, however, could limit themselves to semi-annual reporting.

„A regular reporting schedule is the foundation for the functioning of capital markets,“ says Joachim Schallmayer, Head of Capital Markets and Strategy at Deka. „However, reporting that is too frequent or too comprehensive can also be counterproductive.“ This is the case when companies avoid going public altogether because of the high demands.

Schallmayer is critical of the fact that reporting requirements in the US and Europe have generally increased in recent years – especially regarding sustainability, supply chain due diligence, and transparency. „Medium-sized and smaller companies, in particular, sometimes feel overwhelmed. Against this background, a review of the costs and benefits of reporting requirements appears urgently necessary", he says. In Europe, many companies already report their earnings only on a semiannual basis.

Arne Rautenberg, Head of Equity Portfolio Management at Union Investment, supports this view. „An interim report once every six months is sufficient – It is difficult to assess a business on a quarterly basis", he says. As a long-term oriented investor, he sees only very limited added value in quarterly reports. On the contrary, "quarterly reporting fuels overly short-term thinking.“

Benjardin Gärtner, Global Head of Equities at DWS, disagrees, saying that whether companies present their figures every three or six months makes no difference on how they run themselves. He still advocates for quarterly reporting. „It is a matter of transparency, oversight, and investor protection“, he says. Companies reporting at longer intervals, in his view, should expect share price discounts: „With less transparency, the risk premium rises – there is a direct correlation.“

Since 2015, companies in Europe are no longer required to report on their business performance every quarter. However, stock exchanges can establish their own rules. Companies listed in one of the Dax indices of the Deutsche Börse, for example, are obliged to issue so-called quarterly statements – essentially a streamlined quarterly report.

Many companies in Germany, however, go beyond the required minimum and provide full or nearly full quarterly reports. Others want to do away with the quarterly statement entirely. A legendary legal dispute between Deutsche Börse and Porsche about 20 years ago exemplifies this. Most recently, Allianz attempted such a move in 2020 but reversed it following stakeholder feedback. International investors preferred regular reporting, according to Deutsche Börse.

US President Trump’s statements have now reignited the debate. According to SEC Chairman Atkins, reporting has become overly complex. „The reporting standard should be understandable to an ordinary investor,“ he recently told journalists in Frankfurt. The discussion on quarterly reports was initially sparked by the US exchange operator Long-Term Stock Exchange (LTSE) in early September.

„It is important that companies communicate regularly with the capital market. But it doesn’t have to be a large set of figures – reporting twice a year is sufficient for us,“ says Pascal Spano, Head of Research at Bankhaus Metzler. „For many items, it is difficult to define them on a quarterly basis anyway. It is very complex and makes little business sense.“ He does not fear that individual investor groups would be cut off from information, noting that „there is an ad hoc reporting requirement – if a company’s performance deviates from expectations, it must communicate this immediately.“

Marc Liebscher of the shareholder protection organisation Deutsche Schutzvereinigung für Wertpapierbesitz (DSW) emphasises, however, that the ad hoc requirement must also be enforced. „Today, important news is often buried in dozens of pages of the annual report", he says. Against this background, he can imagine eliminating quarterly reporting – at least for companies outside the blue chips.

„There is an information overload at companies. Who actually reads all of it?“ asks Marc Tüngler, CEO of the DSW), and sees the key to greater investor protection in more transparent reporting. Even the streamlining of first- and third-quarter reports – the quarterly statement – has shown an effect. „The reports have become tighter and therefore shorter.", he says. Smaller investors and retail shareholders must not be cut off from information, „because large investors maintain continuous communication with management and companies.“