Rethinking Corporate Disclosures: A Call for Clarity and Frequency Adjustment
A Sebi official highlighted issues with corporate disclosures at a recent conference, urging for clearer communication and questioning the need for quarterly updates. Rajesh Dangeti emphasized that disclosures should be frequent and easily understood by investors, while pondering a reduction in disclosure frequency.
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A Securities and Exchange Board of India (Sebi) official has raised concerns over the clarity of corporate disclosures, suggesting they often leave much to the imagination. Speaking in New Delhi, Rajesh Dangeti from Sebi questioned if the existing quarterly disclosure schedule is necessary, advocating for more transparent communication that investors can readily grasp.
At the 'Agile Governance: Fostering Transparency & Building Trust' conference organized by Ficci, Dangeti emphasized the importance of fair, frequent, and clear disclosures by companies. He underscored that while companies adhere to disclosure requirements in letter, the spirit of transparency might be lacking. This, he observed, could undermine shareholder protection, particularly for minority investors.
Dangeti also prompted the corporate sector to consider whether advancements in technology and efficient depository systems can justify reducing disclosure frequencies. With many companies adapting to technological changes, he suggested re-evaluating the necessity of issuing certain disclosures quarterly, urging a rethinking of current practices to enhance clarity and efficiency.
(With inputs from agencies.)
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