{"id":50538,"date":"2025-10-15T10:00:00","date_gmt":"2025-10-15T08:00:00","guid":{"rendered":"https:\/\/frankfurt-main-finance.com\/?p=50538"},"modified":"2025-10-14T17:29:23","modified_gmt":"2025-10-14T15:29:23","slug":"fewer-reporting-requirements-dvfa-investment-professionals-warn-of-negative-consequences-for-capital-markets","status":"publish","type":"post","link":"https:\/\/frankfurt-main-finance.com\/en\/fewer-reporting-requirements-dvfa-investment-professionals-warn-of-negative-consequences-for-capital-markets\/","title":{"rendered":"Fewer reporting requirements? DVFA investment professionals warn of negative consequences for capital markets"},"content":{"rendered":"\t\t
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In mid-September, US President Donald Trump proposed that publicly traded US companies should be able to dispense with quarterly reports in future and only publish half-yearly and annual financial statements. Trump and the new SEC chief Paul Atkins argue that this would reduce bureaucratic burdens and lessen the short-term orientation of corporate leaders and investors alike. The American president was thus revisiting his idea from 2018. At the time, it had found support from Jamie Dimon and Warren Buffet, among others, and there are also proponents in Germany.<\/p>

\u201cIn fact, the topic is being hotly debated. This is confirmed by the responses of our DVFA investment professionals to the latest monthly question,\u201d said Peter Thilo Hasler, member of the DVFA Executive Board, commenting on the results. \u201cOverall, however, there is skepticism about the US proposal, especially in view of the quality of the transparent and efficient capital markets in Germany and Europe.\u201d<\/p>

As usual, respondents had a choice of predefined answers, but this time, for question 4, they also had the option of formulating their own answer.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Rejection of Trump's proposal prevails \u2013 one-third undecided<\/strong><\/b><\/span><\/p><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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42% of respondents reject the proposal because it weakens market transparency and jeopardizes the efficiency of pricing and capital allocation overall. It is important to avoid information asymmetries between strategic investors with their specific access to company information on the one hand, and smaller investors who are dependent on public disclosures on the other.<\/p>

Around a quarter of survey participants (26%) support the measure, as it would reduce short-term thinking and strengthen long-term corporate management.<\/p>

Almost one in three (32%) are undecided. They do not want to assess the measure as either positive or negative on its own, as its effect would depend heavily on its interaction with ad hoc publicity and voluntary corporate disclosures. Comments included the suggestion that less frequent earnings reports could make sense for long-listed companies with stable business models, provided that ad hoc publicity works.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Fear of reduced quality of capital market communication<\/strong><\/b><\/span><\/p><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Concerns about a decline in quality dominate the expected impact on capital market communications. Around a quarter of respondents fear an increase in opportunistic communication strategies (25%), uncertainty among investors due to greater reliance on voluntary management guidance and analyst estimates (26%), or a growing information gap between \u201cinformed\u201d institutional investors and less well-informed private investors (26%).<\/p>

However, 23% of the investment professionals who responded also hope that the elimination of quarterly reports will increase the importance of general corporate communications, as the focus would then be less on quarterly figures and more on strategic narratives. \u201cMore personal responsibility, less regulation\u201d was one of the comments on this. At the same time, participants accept that in this case, the importance of ad hoc publicity would increase.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Expected effects on capital market communication<\/strong><\/p>

Increase in opportunistic strategies – 25%
Investor uncertainty – 26%
Growing information gap – 26%
Increasing importance of communication – 23%<\/p>

Source: DVFA e.V.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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Negative impact on the functioning of capital markets expected<\/strong><\/b><\/span><\/p><\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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When asked about the impact of the American proposal on capital markets and their function, a clear majority of DVFA members participating in the survey (62%) chose the two response options that express skepticism.<\/p>