Proposed SEC rollbacks for public company quarterly reporting and disclosures

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The Securities and Exchange Commission (SEC) is proposing amendments that would allow public companies the option to file semiannual earnings reports instead of the current quarterly reporting (Form 10-Q). If enacted, the new reporting structure would shift public company disclosure obligations toward a more principles-based, materiality-driven framework under Regulation S-K. Although these proposals remain at the pre-rule stage, they are being taken seriously by issuers, investors, and the directors and officers liability (D&O) insurance market.

On the surface, the proposals are framed as ways to reduce the compliance burden and discourage short-termism. From a liability perspective, however, quarterly reporting and disclosure rollbacks are more likely to redistribute risk rather than reduce it. This is mainly because the current regime produces frequent, standardized disclosure events. While the contemplated regime mandates fewer disclosures, each disclosure event — whether periodic or voluntary — could be interpreted as carrying more weight by shareholders and other stakeholders.

Shift from continuous to episodic liability

Under the current quarterly reporting structure, public companies benefit from a predictable disclosure cadence. Each Form 10-Q may serve as both an update and, practically, a partial reset of the disclosure record. Plaintiffs face constraints in extending alleged class periods because the market is refreshed with updated information at regular intervals.

A move to semiannual reporting — or an optional quarterly regime — disrupts that cadence. The result is the creation of longer “information gaps” during which material developments may occur without a mandated reporting checkpoint. In that environment, plaintiffs are more likely to allege that adverse information was known but not disclosed in a timely manner, particularly where the eventual disclosure produces a sharp market reaction.

This dynamic does not necessarily increase the number of securities class actions, but it could increase claim severity. Longer class periods, larger alleged inflationary effects, and more complex loss-causation arguments are likely.

Elevation of voluntary disclosure risk

As mandatory reporting frequency decreases, the system might implicitly rely more heavily on voluntary disclosures, including earnings releases, investor presentations, conference remarks, and Form 8-K filings. These communications may, in practice, become the primary vehicles through which the market receives interim information.

From a D&O perspective, this raises a potentially meaningful shift. Unlike Forms 10-Q and 10-K, which are highly structured, heavily reviewed, and supported by established disclosure controls, voluntary disclosures are comparatively less standardized and more context-dependent. They are also more likely to be forward-looking, narrative-driven, and responsive to real-time developments. These voluntary disclosures may be heavily scrutinized, with language parsed for errors, omissions, inconsistencies, or overly optimistic framing, which, if found, can lead to risks for the company and its directors and officers.

Materiality-based disclosure and under-disclosure risk

The SEC’s parallel effort to streamline Regulation S-K emphasizes a shift away from prescriptive, line-item disclosure requirements toward a more principles-based materiality standard. While this offers flexibility, it can also transfer greater judgment and therefore increase liability risk for management and the board.

In practice, this creates tension. On one hand, there is regulatory encouragement to eliminate boilerplate and reduce immaterial disclosure. On the other hand, plaintiffs’ counsel might continue to argue, with the benefit of hindsight, that omitted information was in fact material. Courts applying the established materiality standard under federal securities laws will not necessarily defer to a company’s decision to streamline disclosures.

Regulation FD and selective disclosure pressure

Reduced formal reporting frequency is likely to increase pressure from analysts and investors for interim updates. This, in turn, can raise the risk of inadvertent selective disclosure under Regulation Fair Disclosure (FD). The company’s management team — particularly those involved in investor relations and external communications — might face more frequent judgment calls about what should be shared, when, and in what forum.

Practical actions to consider

The central mistake would be to interpret reduced reporting obligations as a basis for reducing disclosure discipline. The more defensible approach — particularly for a high-profile issuer — is to maintain a disclosure cadence and rigor that approximates the current regime, even if not strictly required. Organizations, in discussion with their legal counsel, should consider:

Preserving a de facto quarterly review and disclosure process
Applying 10-Q level controls to investor presentations, earnings scripts, production updates, sustainability disclosures, and reserve commentary
Documenting contemporaneous materiality decisions around reserves, impairments, environmental matters, and project developments
Tightening Regulation FD protocols for management, investor relations, technical teams, and operational leaders
Aligning legal, finance, operations, engineering, environmental, and investor relations teams before external communications
Engaging early with directors and officers liability (D&O) insurance carriers on evolving disclosure controls and event-driven risk management

The proposed SEC changes represent a structural shift in the disclosure landscape. For D&O purposes, they should be understood not as deregulation in the traditional sense, but as a reallocation of liability toward fewer, more consequential disclosure events.

Heightened securities exposure in an event-driven sector

Pharmaceutical and biotech public companies face a distinct and heightened exposure under the proposed SEC changes because their market value depends heavily on discrete, often binary, events — clinical readouts, regulatory decisions, safety signals, manufacturing issues, and commercial inflection points. Any regulatory shift that increases the temporal distance between required disclosures will amplify scrutiny around when management knew what, and when it chose to disclose it.

The move toward fewer mandatory filings also elevates the importance of voluntary communications. Longer class periods, larger alleged inflationary effects, and more complex loss‑causation arguments are likely. For a pharmaceutical company or biotech, where a single clinical or regulatory event can drive substantial market capitalization shifts, this has the potential to create a materially different exposure profile.

Earnings releases, investor presentations, conference remarks and Form 8‑K notices are likely to carry disproportionate informational weight and become focal points for liability. For life‑science companies, voluntary statements about trial progress, timelines, or regulatory interactions are inherently judgmental and forward‑looking; when these communications substitute structured periodic filings, they may be parsed intensely for alleged omissions, inconsistencies, or overly optimistic assertions.

Life‑science issuers should treat these structural changes as a call to preserve disclosure discipline, not loosen it. Maintaining a de facto quarterly cadence, applying 10‑Q level controls to voluntary disclosures, documenting contemporaneous materiality decisions for clinical and regulatory matters, and tightening IR scripts and escalation protocols will reduce the risk that an information gap or discretionary communication becomes the center of a damaging securities claim. Early engagement with D&O underwriters on evolving disclosure governance will also help demonstrate to the market and carriers that the company is managing the shift responsibly.

SEC reporting and disclosure rollback — D&O risk summary for life sciences companies

Regulatory shift	What changes	D&O exposure shift	Life sciences-specific amplifier	Actions to consider
Reduced optional quarterly reporting (10Q)	Longer intervals between mandated disclosures (potential semiannual cadence)	Fewer disclosure points, but potentially longer class periods and higher-severity claims; increased delay of disclosure allegations	Clinical failures, FDA feedback, or safety signals may occur mid-cycle — framed as withheld material events	Maintain de facto quarterly disclosure discipline even if not required
Greater reliance on voluntary disclosure (8-Ks, earnings releases, investor calls	Shift from structured filings to more discretionary communications	Each disclosure becomes a primary liability anchor; less standardized review increases misstatement/omission risk	Pipeline updates, trial commentary, and forward-looking timelines are inherently uncertain and subject to scrutiny	Apply 10-Q level controls to all external communications; centralize disclosure reviews
Materiality-based disclosures (8-K “rationalization”)	Fewer prescriptive requirements; more issuer judgment on what to disclose	Increased hindsight litigation risk; plaintiffs challenge omissions as “material”	Determining materiality of interim clinical data, adverse events, or regulatory dialogue is highly judgment-driven	Document materiality analyses contemporaneously; avoid over-pruning disclosures
Longer information gaps between disclosures	The market receives less frequent formal updates	Greater opportunity for inflation build-up and larger corrective disclosures could lead to higher damages models	Binary events (trial readouts, FDA decisions) can reprice the company	Implement event-triggered disclosure protocols independent of the reporting cycle
Increased analyst and investor pressure for interim updates	More informal communications outside of format filings	Elevated regulatory financial disclosure risk and selective disclosure exposures	High investor sensitivity to pipeline progress and increase risk of inadvertent signaling	Tighten internal reporting scripts, training, and escalation policies; pre-clear sensitive topics. Consistency may be key
Shift from prescriptive to principles-based regime	Less “check-the-box,” more reliance on management judgment	Greater scrutiny of process and governance, not just outcomes	Boards must evaluate nuanced scientific/regulatory information with legal implications	Enhanced board-level oversight of disclosure judgments; formalize review frameworks
Loss causation complexity	Fewer disclosures aggregate more events into a single corrective disclosure	More complex and costly litigation; harder to isolate cause — could lead to higher defense costs	Multiple pipeline or regulatory developments may be bundled into one disclosure event	Preserve clear internal timelines and documentation of developments and decisions
Market activist expectations	Peers may continue quarterly reporting voluntarily	Deviation from peer disclosure norms may be framed as a governance weakness	Pharma and biotech investors rely heavily on consistent pipeline visibility	Benchmark against peers; consider voluntary continuation of quarterly cadence
D&O insurance underwriting — potential shift	Underwriters may focus less on frequency, more on disclosure controls	No expected reduction in premiums; focus on even-driven risk management	Sector already viewed as having potential for high-volatility and being litigation-prone	Engage insurers early; demonstrate robust interim disclosure governance

Securities risk shaped by reimbursement and execution risk

Public healthcare companies face a distinct exposure profile because valuation often depends on reimbursement stability, utilization trends, labor management, operational execution, regulatory compliance, patient outcomes, cybersecurity preparedness, and management’s ability to forecast margins and growth.

Reduced mandatory reporting may amplify scrutiny around when management knew reimbursement trends were deteriorating, staffing shortages were worsening, utilization was weakening, compliance issues were emerging, cybersecurity risks were increasing, or guidance was no longer supportable. Many of these issues develop incrementally but can trigger sharp market reactions once formally disclosed.

Voluntary communications will matter more. Earnings releases, investor presentations, analyst calls, operational updates, conference remarks, guidance commentary, and Form 8-K filings may be parsed closely for alleged omissions, inconsistencies, or overly optimistic assumptions.

Healthcare issuers should consider preserving quarterly disclosure discipline, apply formal controls to all investor-facing communications, document materiality decisions in real time, and tighten Regulation FD escalation protocols. D&O carriers will likely focus on whether the company has credible controls around reimbursement exposure, operational performance, staffing, cybersecurity, compliance, patient care, regulatory investigations, and guidance governance.

SEC reporting and disclosure rollback — D&O risk summary for public healthcare companies

Regulatory shift	What changes	D&O exposure shift	Healthcare-specific amplifier	Actions to consider
Reduced optional quarterly reporting/Form 10-Q	Longer intervals between mandated disclosures	Longer class periods and higher-severity delayed-disclosure allegations	Reimbursement pressure, utilization declines, staffing shortages, compliance issues, physician practice integration issues, or regulatory investigations may emerge mid-cycle	Maintain de facto quarterly disclosure discipline
Greater reliance on voluntary disclosure	More reliance on earnings releases, investor calls, operational updates, and conferences	Each disclosure becomes a primary liability anchor	Commentary regarding reimbursement, patient volumes, occupancy, staffing, margins, and compliance is highly scrutinized	Apply 10-Q level controls to all external communications
Materiality-based disclosures	More issuer judgment on what to disclose	Higher hindsight risk over alleged omissions	Determining materiality for regulatory inquiries, billing issues, cybersecurity, staffing, litigation, or care-quality concerns can be highly judgment-driven	Document materiality analyses contemporaneously
Longer information gaps	The market receives less frequent formal updates	Greater inflation build-up and larger corrective disclosures	Healthcare operations can be materially affected by reimbursement changes, labor pressure, utilization trends, or enforcement developments; larger information gaps could lead to bigger surprises for investors	Use event-triggered disclosure protocols
Increased analyst and investor pressure	More informal communications outside of formal filings	Higher Regulation FD and selective disclosure risk	Investors seek frequent color on reimbursement, margins, labor, utilization, occupancy, FCA matters, and compliance exposure	Tighten internal reporting scripts, training, and escalation policies
Principles-based regime	Less check-the-box disclosure	More scrutiny of governance and disclosure controls	Boards must assess the legal significance of operational, reimbursement, regulatory, cybersecurity, and patient care risks	Formalize board-level disclosure review
Loss causation complexity	Multiple developments may be bundled into one corrective disclosure	More costly litigation and harder causation analysis	Margin pressure, reimbursement changes, staffing shortages, compliance failures, litigation, and operational disruption may overlap	Preserve internal timelines and decision records
Market and activist expectations	Peers may continue quarterly reporting voluntarily	Reduced cadence may be framed as weak transparency	Healthcare investors often expect regular visibility into reimbursement, operations, compliance, utilization, and guidance	Benchmark peers; consider voluntary quarterly cadence
D&O insurance underwriting	Focus shifts to disclosure controls and event-driven governance	No automatic premium benefit	The sector is exposed to reimbursement risk, labor inflation, cyber exposure, regulatory scrutiny, compliance enforcement, and operational volatility	Engage insurers early; demonstrate strong interim controls

Disclosure risk driven by technical judgement and market volatility

For public energy and power companies, the proposed SEC changes can lead to significant risks since market value is often tied to volatile, technical, and judgment-intensive information. Commodity prices, reserve estimates, production volumes, asset impairments, project execution, environmental liabilities, permitting outcomes, geopolitical events, and energy-transition strategy can each materially affect valuation.

Any regulatory shift that increases the time between mandatory disclosures may amplify scrutiny around when management knew of adverse developments and when it chose to disclose them. For exploration and production companies, reserve revisions, drilling results, production shortfalls, or hedging losses can quickly become focal points of potential securities litigation. For midstream, refining, utilities, LNG, and integrated energy companies, project delays, cost overruns, environmental events, regulatory changes, and demand shifts may create a similar exposure. Power companies share many of these exposures, as well as heightened focus on specific issues, such as wildfire risk and mitigation strategies and capital expenditure and growth projections to meet increasing electricity demand driven by data center growth.

A distinguishing risk for energy and power companies is that many potentially material developments emerge gradually and require technical judgment before crystallizing. Reserve downgrades, impairments, permitting challenges, emissions‑related exposures, climate and weather impacts, or transition‑strategy changes often involve evolving data and assumptions rather than discrete triggering events. In a disclosure framework that relies more heavily on management’s materiality judgments, plaintiffs may later argue — with the benefit of hindsight — that information should have been disclosed earlier, particularly where subsequent announcements result in sharp market reactions.

The move toward fewer mandatory filings also elevates the importance of voluntary communications. Earnings releases, investor presentations, conference remarks, production updates, sustainability reports, and Form 8-K filings may carry disproportionate informational weight. Statements about reserves, capital discipline, project economics, emissions targets, transition plans, or commodity sensitivity are often forward-looking and based on assumptions. If those communications are used as a substitute for structured periodic filings, they may be parsed aggressively for alleged omissions, inconsistency, or optimism that later proves unsupported.

Finally, reduced formal reporting frequency may increase pressure on management to provide interim updates in less formal settings. For energy companies, investor demand for frequent detail on production trends, free cash flow, capital allocation, regulatory developments, and project execution may elevate the risk that informal commentary — particularly at conferences or analyst meetings — becomes a focal point in Regulation FD inquiries or securities litigation.

Taken together, these dynamics suggest that the proposed SEC changes may have a disproportionate impact on D&O exposure for public energy and power companies, not by increasing disclosure obligations, but by concentrating legal risk around fewer, more judgment-intensive, and more market-sensitive disclosure decisions.

SEC reporting and disclosure rollback — D&O risk summary for energy and power companies

Regulatory shift	What changes	D&O exposure shift	Public energy- and power-specific amplifier	Actions to consider
Reduced optional quarterly reporting/Form 10-Q	Longer intervals between mandated disclosures; potential semiannual cadence	Fewer disclosure points, but potentially longer class periods and higher-severity claims; increased delayed-disclosure allegations	Commodity swings, reserve revisions, production misses, impairments, or project delays may occur mid-cycle and later be framed as withheld material developments	Maintain de facto quarterly disclosure discipline even if not required
Greater reliance on voluntary disclosure	Shift from structured filings to more discretionary communications, including earnings releases, investor calls, production updates, and presentations	Each disclosure becomes a primary liability anchor; a less standardized review increases misstatement or omission risk	Production guidance, drilling results, reserve commentary, hedging strategy, and project timelines are highly market-sensitive	Apply 10-Q level controls to all external communications; centralize disclosure review
Materiality-based disclosures	Fewer prescriptive requirements; more issuer judgment on what to disclose	Increased hindsight litigation risk; plaintiffs challenge omissions as material	Materiality of reserve adjustments, environmental incidents, permitting delays, impairments, or transition-plan changes can be highly judgment-driven	Document materiality analyses contemporaneously; avoid over-pruning disclosures
Longer information gaps between disclosures	The market receives less frequent formal updates	Greater opportunity for inflation build-up and larger corrective disclosures, potentially increasing damages models	Energy and power companies may experience rapid repricing from commodity shocks, reserve revisions, operational incidents, or geopolitical disruptions	Implement event-triggered disclosure protocols independent of the reporting cycle
Increased analyst and investor pressure for interim updates	More informal communications outside formal filings	Elevated Regulation FD and selective disclosure exposure	Investors closely track production volumes, free cash flow, capital discipline, commodity sensitivity, and project execution	Tighten internal reporting scripts, training, and escalation policies; pre-clear sensitive topics
Shift from prescriptive to principles-based regime	Less check-the-box disclosure; more reliance on management judgment	Greater scrutiny of process and governance, not just outcomes	Boards must assess technical, operational, environmental, regulatory, and geopolitical developments with legal significance	Enhance board-level oversight of disclosure judgments; formalize review frameworks
Loss causation complexity	Fewer disclosures may aggregate multiple developments into one corrective disclosure	More complex and costly litigation; harder to isolate cause; potentially higher defense costs	Commodity price moves, production issues, reserve revisions, and regulatory developments may be bundled into one market-moving disclosure	Preserve clear internal timelines and documentation of developments and disclosure decisions
Market and activist expectations	Peers may continue quarterly reporting voluntarily	Deviation from peer disclosure norms may be framed as a governance weakness	Energy and power investors often expect consistent visibility into production, capital allocation, reserves, and transition strategy	Benchmark against peers; consider voluntary continuation of quarterly cadence
D&O insurance underwriting — potential shift	Underwriters may focus less on reporting frequency and more on disclosure controls	No expected reduction in premiums; focus shifts toward event-driven risk governance	The sector already carries volatility from commodities, environmental exposure, regulatory scrutiny, and geopolitical risk	Engage insurers early; demonstrate robust interim disclosure governance

Podcast

Proposed SEC rollbacks for public company quarterly reporting and disclosures

Shift from continuous to episodic liability

Elevation of voluntary disclosure risk

Materiality-based disclosure and under-disclosure risk

Regulation FD and selective disclosure pressure

Practical actions to consider

Heightened securities exposure in an event-driven sector

SEC reporting and disclosure rollback — D&O risk summary for life sciences companies

Securities risk shaped by reimbursement and execution risk

SEC reporting and disclosure rollback — D&O risk summary for public healthcare companies

Disclosure risk driven by technical judgement and market volatility

SEC reporting and disclosure rollback — D&O risk summary for energy and power companies

Our people

Brenda Shelly

Sarah Baldys

Allison Carr

Nicole Francis

Abigail Williams

Alyssa Wade

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Proposed SEC rollbacks for public company quarterly reporting and disclosures

Shift from continuous to episodic liability

Elevation of voluntary disclosure risk

Materiality-based disclosure and under-disclosure risk

Regulation FD and selective disclosure pressure

Practical actions to consider

Pharmaceutical and biotech companies

Heightened securities exposure in an event-driven sector

SEC reporting and disclosure rollback — D&O risk summary for life sciences companies

Public healthcare companies

Securities risk shaped by reimbursement and execution risk

SEC reporting and disclosure rollback — D&O risk summary for public healthcare companies

Public energy and power companies

Disclosure risk driven by technical judgement and market volatility

SEC reporting and disclosure rollback — D&O risk summary for energy and power companies

Contact us

Our people

Brenda Shelly

Sarah Baldys

Allison Carr

Nicole Francis

Abigail Williams

Alyssa Wade

Related insights

Managing tomorrow’s risks today: Quantifying emerging risks to drive success for energy & power companies

Risks to watch as private credit’s growth outpaces oversight

Risk outlook for digital assets in 2026

Mixed securities litigation trends and potential D&O implications