Legal & General Investment Management calls for end to unnecessary quarterly financial reporting
Legal & General Investment Management (LGIM), one of the largest investors in the UK plc, has issued a letter to the Boards of FTSE 350 companies outlining its supportfor the recent regulatory change that removes the requirement for companies to disclose financial reports on a quarterly basis.
The letter ( LGIM Zinkula letter end quarterly (PDF: 40KB) ), from LGIM Chief Executive Mark Zinkula, states that reporting which focuses on short-term performance is not necessarily conducive to building a sustainable business as it may steer management to focus more on short-term goals and away from future business drivers.
LGIM acknowledges that the management and boards of companies will ultimately make appropriate judgments as to the relevance of their quarterly reports, based on their unique business environment.
Mark Zinkula, Chief Executive at LGIM, said: "As a major investor of shares and bonds of UK listed companies, invested through both active and index funds, we highly value the communication we have with management teams. For many businesses, we believe, reducing the time spent on frequent reporting could help management to focus more on long term strategies and articulate more on market dynamics and innovation drivers that will enhance their performance over time.
"Some companies have already chosen to discontinue quarterly reports and we are supportive of their actions."
Notes to editors
LEGAL & GENERAL INVESTMENT MANAGEMENT:
Legal & General Investment Management (LGIM) is one of Europe’s largest institutional asset managers and a major global investor. LGIM manages £736.8 billion in total assets for more than 3,000 clients*. Of the Assets Under Management, 58% of the investments are made through index tracking funds and 42% are invested in actively managed portfolios. Throughout the past 40 years we have built our business through understanding what matters most to our clients and transforming this insight into valuable, accessible investment products and solutions. We provide investment expertise across a full spectrum of asset classes including equities, fixed income, commercial property and cash. Our capabilities range from index-tracking and active strategies to liquidity management and liability-based risk management solutions.
*As at 31 March 2015; total assets include assets under management, notional derivative positions and advisory assets.
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About Legal & General
Legal & General Investment Management Limited.
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London EC2R 5AA.
Registered in England 2091894.
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