President Trump is once again showing business leaders across America that he understands the engine of our economy is fueled not by bureaucrats, but by entrepreneurs, workers, and investors. His latest move, directing the Securities and Exchange Commission (SEC) to consider easing reporting requirements, is a welcome step toward restoring common sense in Washington and unleashing American prosperity.
For decades, American businesses have evolved into a short-term mindset as executive compensation became linked to short term results. Quarterly reporting may sound like a transparency measure, but in reality, it traps managers in a cycle of meeting or ideally beating Wall Street’s expectations every 90 days instead of pursuing strategies that maximize shareholder value over five, ten, or twenty years.
By freeing executives from this treadmill, we give them the space to innovate, to invest, and to build enduring growth that benefits investors and employees alike. Creating alignment with shareholders whose holding period can be very long.
Semi-annual reporting is already the norm for mutual funds and ETFs, which together represent trillions of dollars of retirement savings. Large hedge funds only must report annually. No one questions the soundness of those investments simply because they report twice a year or annually. The idea that corporations could adopt a similar schedule should be seen not as radical, but as aligning America with proven practices that deliver results for ordinary investors.
The benefits go beyond time horizons. Reporting mandates act as a hidden tax. Large corporations can absorb the cost with teams of lawyers and accountants, but small and mid-sized firms, the true job creators, are disproportionately punished. Millions of dollars are spent on paperwork instead of on new hires, wage increases, or the expansion of facilities. Every dollar spent on compliance is a dollar denied to shareholders, workers, and consumers.
Critics will claim this reform is a gift to “big business.” We disagree. Ordinary Americans are very significant shareholders through their retirement accounts, pensions, and 401(k)s. When businesses are freed to think long-term and reinvest capital, stock values rise, dividends grow, and families see their savings strengthened. Reducing the compliance burden is a victory for Main Street, not just Wall Street.
There is also a global competitive edge at stake. Other nations are eager to lure companies away with friendlier regulatory environments. Each new mandate tips the scale in their favor. If America wants the next wave of innovation, whether in technology, medicine, or energy, to be financed and headquartered here, we need to ensure our system is not weighed down by excessive red tape.
Detractors will raise the specter of the 2008 financial crisis, but that meltdown was not the result of too little regulation. At the time, banks and financial services firms were some of the most regulated companies in America. The regulators became captive to industry self-regulation and failed to effectively oversee those regulations and lacked the imagination to recognize how financial service firms were evolving into gray areas of existing regulation.
No amount of regulation will be effective with lax oversight and enforcement. It truly becomes paperwork and checks the box.
President Trump has consistently proven himself willing to think creatively about how to unleash America’s potential. From cutting taxes to eliminating job-killing regulations to fighting for fair trade deals, his policies have empowered workers and reignited growth. The SEC reforms are another bold stroke in the same direction, trusting entrepreneurs, investors, and workers rather than Washington bureaucrats.
As conservatives, we should applaud this vision and willingness to act. Rolling back quarterly reporting is not about weakening oversight. It is about strengthening our economy, empowering businesses of every size, and ensuring that America remains the best place in the world to invest and grow. The president deserves credit for recognizing that our future depends on long-term thinking, not short-term box-checking.
If we want stronger companies, stronger retirement accounts, and a stronger America, then we must embrace reforms that give managers the freedom to look beyond the next quarter and focus on the next generation. President Trump’s leadership in this area is exactly the kind of creativity and energy that will keep America first in the world economy.
Bill Flaig is the Co-Founder and CEO of The American Conservatives Values ETF (ACVF).