Coalition set to spare firms from quarterly results

Marion Dakers
THE END of quarterly reporting is in sight, the government said yesterday in an update to its plan to encourage long-term investing.

The Financial Conduct Authority is drafting a timetable for a move away from mandatory interim management statements and quarterly reports, which the Kay Review last year said could unfairly highlight short-term changes within companies.

The exact dates will be confirmed once revisions to a European directive on transparency come into force.

The Department for Businesses, Innovation and Skills added that it supports the idea of directors holding shares in the companies they run, and heralded signs of firms setting out more clearly the pay packages of top staff.

It also agrees that fund managers should personally hold a long-term share in the funds they look after.

“We are delighted the committee has supported the recommendation that company directors should be tied into the long-term performance of their companies through time-appropriate shares,” said Dominic Rossi, chief investment officer of equities at Fidelity.

On takeovers, the department said yesterday there would be practical problems with putting the rights of long-term shareholders above the votes of those who pile in once a bid is announced, though it said the notion was “initially attractive”.

The government said it does not plan to force companies to consult investors when they appoint a new board member, as called for by Professor Kay in his report in July 2012.

“The 12 years of inaction following the Myners Review is proof enough that cultural change will not happen without a catalyst,” said BIS select committee head Adrian Bailey MP after the update. “The government must be willing to provide that catalyst and pick up a regulatory stick if necessary.”