Norges Bank Investment Management (NBIM), the vast sovereign wealth fund of Norway, has formally submitted a comment letter to the U.S. Securities and Exchange Commission (SEC) advocating for a significant shift in corporate financial reporting. The proposal, which would allow publicly traded companies to opt for semiannual reports on a new Form 10-S in lieu of the current quarterly reporting on Form 10-Q, has garnered support from NBIM, which argues that such a move could foster greater long-term strategic focus and reduce the detrimental effects of short-term earnings pressure on corporate decision-making.
Carine Smith Ihenacho, Chief Governance and Compliance Officer, and Snorre Gjerde, Lead Investment Stewardship Manager at NBIM, authored the submission, which is underpinned by their organization’s extensive experience managing the Norwegian Government Pension Fund Global. As of the end of 2025, NBIM managed over $2 trillion USD in assets, with the United States representing its largest investment market, accounting for 53% of its total investments. Within its equity portfolio alone, NBIM held $822 billion USD in shares of 1,306 U.S. public companies, typically as a minority shareholder with an average equity ownership of 1.18 percent. This substantial presence in U.S. capital markets positions NBIM as a key stakeholder with a vested interest in the efficiency and effectiveness of corporate disclosure mechanisms.
The core of NBIM’s argument rests on the belief that mandatory quarterly reporting, while intended to provide timely information, inadvertently incentivizes a focus on short-term financial performance at the expense of durable, long-term value creation. In their 2025 Asset Manager Perspective on corporate reporting frequency, NBIM detailed how the relentless pressure to meet quarterly earnings guidance can steer management toward decisions that prioritize immediate results over sustained investment and innovation. They contend that a well-designed semiannual reporting framework, coupled with robust safeguards, can preserve essential transparency and accountability while enabling companies to dedicate more attention to their long-term strategic objectives.
NBIM’s submission to the SEC specifically addresses several key questions posed in the SEC’s request for comment, offering nuanced perspectives on the proposed transition to semiannual reporting.
Supporting the Option for Semiannual Reporting
Question 1: Should companies have the option to file semiannual reports, or should all companies continue to be required to file Form 10-Q? What types of companies are likely to elect the option?
NBIM firmly supports providing companies with the option to file semiannual reports. They reiterate their concern that mandatory quarterly reporting and the associated pressure to meet short-term earnings guidance can lead to decisions prioritizing near-term results over long-term investment and value creation. The fund believes that, under appropriate circumstances, reduced reporting frequency can allow management to shift their focus from the quarterly earnings cycle to long-term strategy, offering less frequent but more insightful updates on a company’s value creation prospects.
The flexibility of semiannual reporting, according to NBIM, is particularly suited for companies where quarterly financial results are less indicative of long-term prospects. This includes capital-intensive businesses with extended investment cycles or companies whose value drivers are primarily linked to clinical, regulatory, or product development milestones. NBIM also points to international precedents, noting that major jurisdictions like the European Union, the United Kingdom, and Singapore have moved away from mandatory quarterly reporting. Their experiences suggest that high-quality semiannual reporting, supplemented by continuous disclosure obligations, can adequately support informed investment decisions. NBIM itself has transitioned from quarterly to semiannual reporting for its own results, finding that this shift facilitated a greater focus on long-term strategy and value creation.
However, NBIM’s support is contingent on the reporting framework being meticulously designed across three critical dimensions:
- Risk-based eligibility criteria: Ensuring that only appropriate companies switch to semiannual reporting.
- Well-governed transition process: Establishing a clear and orderly process for companies to adopt the new reporting cadence.
- Measures to preserve disclosure quality: Maintaining the integrity and comprehensiveness of information both within semiannual reports and in the intervals between filings.
The Case for Optionality and Risk-Based Safeguards
Question 2: Should the SEC require all companies to file semiannual reports, or offer it as an option? What are the benefits and costs of a mandatory approach?
NBIM advocates for the proposed optional approach, arguing that the optimal reporting frequency can vary significantly across companies and their investor bases. They highlight that the academic and practitioner evidence regarding the effects of reporting frequency is mixed. Optionality allows companies to select a reporting cadence that best aligns with their business model and circumstances, with investor engagement and market discipline serving as mechanisms for accountability.
Drawing on international experience, NBIM notes that in jurisdictions that have moved away from mandatory quarterly reporting, a substantial number of companies continue to report quarterly voluntarily, reflecting investor demand. A mandatory approach, they caution, risks removing this flexibility without a clear, commensurate benefit.
To ensure that decisions to switch to semiannual reporting truly serve the long-term interests of companies and their investors, NBIM urges the SEC to consider a risk-based approach to eligibility. They suggest that certain categories of issuers should remain subject to mandatory quarterly reporting. Drawing parallels with Singapore Exchange Regulation (SGX RegCo), which employs a risk-based approach requiring quarterly reporting for companies with modified audit opinions, going concern uncertainties, material disclosure breaches, or issues with significant financial impact, NBIM proposes similar safeguards. This model enables more effective monitoring of issuers with higher risk exposure while allowing others to benefit from reduced reporting frequency.
Furthermore, NBIM recommends that companies be required to disclose the board’s rationale for switching to semiannual reporting. Shareholders should be afforded an adequate opportunity to engage with management prior to the change taking effect. The election of reporting frequency, they propose, should be announced and implemented prior to the start of the fiscal year to preclude switches based on interim performance rather than long-term value creation. A minimum commitment period for the chosen reporting frequency would also help prevent frequent shifts between regimes, which could create misleading signaling dynamics and undermine the consistency of financial data relied upon by market participants.
Eligibility Criteria and Transition Mechanisms
Question 3: Should the option for semiannual reporting be available only to companies that satisfy certain criteria? If so, what criteria should be imposed and why?
Expanding on their response to Question 2, NBIM reiterates its encouragement for the SEC to consider whether certain issuers should remain subject to mandatory quarterly reporting. They again reference SGX RegCo’s risk-based approach, which mandates quarterly reporting for companies facing audit qualifications, going concern uncertainty, or material disclosure breaches. NBIM believes that an eligibility framework calibrated to issuer risk would provide enhanced investor protection in companies where more frequent oversight is deemed necessary.
Question 9: Would investors and other market participants benefit from earlier notice of a company’s intent to file semiannual reports? If so, how and what would be the mechanism?
NBIM strongly supports an advance notice requirement for companies intending to switch to semiannual reporting. Under the SEC’s current proposal, the first public indication of such a switch would be a checkbox on the Form 10-K, leaving investors with no opportunity to engage before the change becomes effective. NBIM proposes that companies should be required to announce their intention to switch well in advance of the relevant fiscal year, providing investors with sufficient time to understand the rationale and engage with management. This proactive disclosure would allow for a more informed and collaborative transition.
Question 10: Should the SEC require companies to maintain their selected interim reporting frequency for the entire fiscal year? Should issuers be required to commit to a certain period?
NBIM supports the imposition of a minimum commitment period for a company’s chosen reporting frequency. They argue that frequent switching between reporting regimes could generate misleading signaling dynamics that distort market expectations and undermine the consistency of financial data. This could create volatility and uncertainty for investors and other market participants. They refer back to their suggestions in Question 2 regarding the best practices for effectuating such a switch, emphasizing the need for stability and predictability in reporting cadences.
Preserving Disclosure Quality and Enhancing Transparency
Question 14: Should Form 10-S require narrative or financial information that differs from Form 10-Q?
NBIM believes that the benefits of a shift to less frequent interim reporting are predicated on companies continuing to provide high-quality information pertaining to their long-term strategy and value creation prospects. They note that the SEC is concurrently reviewing the content and format of narrative disclosures through the Regulation S-K reform initiative and encourage the Commission to consider these two workstreams in tandem to optimize corporate reporting in terms of both form and frequency.
Regarding narrative information, NBIM references their April 2026 comment letter on reforming Regulation S-K, where they emphasized the importance of disclosures on risk factor exposure and mitigation, compensation alignment with value creation, and corporate governance matters crucial for investor protection and decision-making. On financial information, NBIM suggests the SEC consider whether companies should continue to report financial data broken down by quarter within their semiannual filings. This would preserve the comparability and granularity of data series relied upon by investors and market participants, without necessitating separate quarterly filings.
Question 19: Should earnings releases by semiannual filers be "filed" rather than "furnished" on Form 8-K?
NBIM supports requiring earnings releases by semiannual filers to be "filed" rather than "furnished" on Form 8-K. They argue that within a semiannual reporting framework, periodic earnings releases effectively become a primary source of information between formal filings. Requiring these releases to be filed would attach appropriate accountability to the information that investors must rely upon during these extended intervals between official reports. This aligns with the principle of ensuring robust investor protection when reporting frequencies are reduced.
Question 20: Should financial information in first or third quarter earnings releases by semiannual filers be reviewed by an independent public accountant?
NBIM supports requiring an independent accountant review of financial information contained in voluntary first or third quarter earnings releases by semiannual filers. This measure, they contend, would help ensure that information quality is maintained between formal filings. Their support for less frequent reporting is premised on the provision of high-quality information, and a review requirement on voluntary releases would reinforce this commitment.
Question 22: Would the option for semiannual reporting result in an overall reduction in material information for investors? Or would other requirements offset this?
NBIM advocates for a reporting framework that upholds transparency and accountability while enabling companies to align their communications and strategic planning toward long-term value creation. The reliability of such a framework, they emphasize, significantly depends on an effective regime for continuous disclosure of material information between formal filings. A clear obligation to disclose material information promptly, supported by robust guidance, can provide investors with a sufficient flow of information without anchoring corporate communications to a rigid three-month cycle.
NBIM points to SGX RegCo’s experience, where strengthening guidance on material information, emphasizing timely updates on events and conditions affecting a company’s financial position or strategic direction, and providing guidance on voluntary business updates were crucial elements of their reviewed interim reporting framework. The SEC could consider issuing guidance to clarify how existing disclosure obligations under Form 8-K apply to gradual or cumulative changes in financial condition or business outlook that are material but do not constitute a discrete triggering event. Simultaneously, such guidance should discourage defensive over-filing that could dilute or obscure investor-relevant information. Whether interim information is provided through Form 8-K or a voluntary quarterly business update, the rigor of these disclosures should be preserved, including by requiring them to be filed rather than furnished and by subjecting financial information to independent review, as discussed in their responses to Questions 19 and 20. NBIM encourages the SEC to monitor the practical application of Form 8-K by semiannual filers and to consult with regulators in jurisdictions with less frequent reporting regimes to leverage their experiences.
Question 30: Should semiannual filers be required to break out financial statement information for the six-month period into two three-month periods?
NBIM supports requiring semiannual filers to present six-month figures broken down into the two underlying quarters. Presenting quarterly figures within semiannual filings would preserve comparability without necessitating separate filings. This would also allow investors and other market participants to conduct trend and benchmarking analyses across issuers and over time, utilizing rigorous and reliable company-reported data. This approach balances the benefits of reduced reporting frequency with the need for granular data analysis.
Broader Implications and the Push for Long-Termism
The SEC’s proposal to allow optional semiannual reporting represents a potential paradigm shift in U.S. financial regulation. For decades, the quarterly reporting cycle has been a cornerstone of the Securities Exchange Act of 1934, designed to provide investors with frequent updates on company performance. However, a growing body of academic research and the observations of large institutional investors like NBIM suggest that this cadence may be fostering a culture of short-termism, potentially hindering innovation, sustainable investment, and long-term value creation.
The implications of NBIM’s advocacy extend beyond mere reporting frequency. It signals a broader movement among sophisticated investors to recalibrate corporate priorities away from the relentless pursuit of quarterly earnings targets and towards a more sustainable, long-term strategic vision. By encouraging the SEC to consider a framework that balances reduced reporting frequency with enhanced safeguards for disclosure quality and investor protection, NBIM is advocating for a regulatory environment that better aligns corporate incentives with the creation of enduring economic value.
The SEC’s decision on this proposal will have far-reaching consequences for U.S. public companies, investors, and the overall health of the capital markets. The detailed and thoughtful input from NBIM, a major global investor with significant stakes in the U.S. market, provides a critical perspective as the Commission weighs the benefits of reduced short-termism against the established norms of financial reporting. The coming months will reveal whether the SEC embraces this push for a more long-term-oriented reporting structure.
