The investment manager says the recent regulatory change is to be welcomed as it will reduce the prevalence of short-term thinking within companies.
The letter, which is penned by LGIM chief executive Mark Zinkula, says 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.
“As a major investor in the shares and bonds of UK listed companies, invested through both active and index funds, we highly value the communication that we have with management teams,” said Mark Zinkula, chief executive at LGIM.
“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,” Zinkula said.
