Monthly Archives: April 2026

Board Oversight of AI: Do Boards Need AI Experts?

Posted by Avi Gesser, Eric Juergens, and William D. Regner, Debevoise & Plimpton LLP, on
Monday, April 27, 2026
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Avi Gesser, Eric Juergens, and William D. Regner are Partners at Debevoise & Plimpton LLP. This post is based on a Debevoise memorandum by Mr. Gesser, Mr. Juergens, Mr. Regner, Charu Chandrasekhar, Matthew E. Kaplan and Steven J. Slutzky.

As the use of artificial intelligence (AI) across industries increases rapidly, many boards of directors are considering whether they have the expertise necessary to maintain effective oversight of AI-related opportunities and risks. As the SEC has made clear regarding cybersecurity, boards must find a way to exercise their supervisory obligations, even in technical areas, if those areas present enterprise risks. A frequent question in this context is whether boards should have a director who is an “AI expert.”

In this Debevoise Update, we highlight three considerations for boards evaluating the need for AI expertise in the boardroom.

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Sustainability: Scarce Signals From Significant Resolutions

Posted by Lindsey Stewart, Morningstar, Inc., on
Monday, April 27, 2026
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Lindsey Stewart is the Director of Investment Stewardship Research at Morningstar, Inc. This post is based on his Morningstar report.

Key Observations

  • In 2025, there was a steep drop in the number of shareholder resolutions on sustainability that got significant shareholder support (our definition being at least 30% of independent shareholders).
  • There were only 30 such resolutions in the US in the 2025 proxy year, compared with over 100 in each of the previous five years.
  • These significant resolutions are a useful guide to the sustainability topics institutional investors view as material, so their shrinking number creates an information gap.
  • Despite this, our research is still able to surface some useful trends for investors evaluating asset manager intentionality on environmental, social, and governance topics.
  • Overall, average support for significant resolutions on sustainability remained steady at around 40% for the past three proxy years, down from 54% in 2021.
  • The overall stability in average support for significant resolutions masks continued divergence in voting preferences of US and European asset managers, which has persisted since the 2021 peak.
  • Average support by 20 US asset managers for significant resolutions fell by 11 percentage points to 31% over the past three proxy years. Among 18 European firms, there was only a 3-percentage-point drop to 91% over the same period. US sustainable funds showed a similar stable trend.
  • We see a relationship between firm size and the timing of reductions in support for these proposals. The largest reductions in support by the top 10 US firms by size occurred in the 2024 proxy year. For the next 10 US firms in this study, this happened in 2025.

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A Guide to the Big Three’s Proxy Voting Policies & Guidance on Key ESG Issues

Posted by Lyuba Goltser, Rebecca Grapsas and Eleni Samara, Weil, Gotshal & Manges LLP, on
Sunday, April 26, 2026
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Lyuba Goltser and Rebecca Grapsas are Partners and Eleni Samara is an Associate at Weil, Gotshal & Manges LLP. This post is based on their Weil Gotshal memorandum.

Introduction to the Big Three and ESG Guide

The “Big Three” institutional investors, BlackRock, State Street Investment Management and Vanguard, recently released 2026 proxy voting policies and related guidance applicable to US companies. Companies are well-advised to review these policies and guidance in planning for engagement with the Big Three throughout the year and during the proxy season, and in considering environmental, social and governance (ESG) disclosures going forward.

In this Guide, we:

  • Provide ESG-focused practical guidance for public companies to consider in light of these policies and guidance. See also our alert, Looking to the 2026 Proxy Season: Key Corporate Governance, Engagement, Disclosure and Annual Meeting Topics.
  • Identify changes to the proxy voting policies and guidance of the Big Three on ESG topics for 2026.
  • Summarize the expectations of the Big Three as to company practices and disclosures around selected ESG topics, and highlight where failing to meet expectations may result in votes against directors.

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The Deepening DEI Dilemma

Posted by David A. Katz and Loren Braswell, Wachtell, Lipton, Rosen & Katz, on
Saturday, April 25, 2026
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David A. Katz is a Partner and Loren Braswell is Counsel at Wachtell, Lipton, Rosen & Katz. This post is based on their Wachtell Lipton memorandum.

In recent years, U.S. public companies have faced increasing pressure to reconsider their Diversity, Equity, and Inclusion (DEI) policies and initiatives. Under both the first and second
Trump administrations, there has been a marked backlash against the historical push for more representation and inclusion in boardrooms, C-suites, and workplaces. Politically motivated
activists have also been emboldened by the shifting landscape to target companies’ DEI programs through a variety of mechanisms, from shareholder proposals to targeted boycotts. In
this volatile environment, many companies are left grappling with how to balance political and regulatory pressures against corporate values, as well as how to handle competing investor priorities with respect to DEI.

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Financial Institutions M&A Key Trends and Outlook

Posted by Ed Herlihy, Richard Kim, and Nick Demmo, Wachtell, Lipton, Rosen & Katz, on
Friday, April 24, 2026
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Ed Herlihy, Richard Kim, and Nick Demmo are Partners at Wachtell, Lipton, Rosen & Katz. This post is based on a Wachtell memorandum by Mr. Herlihy, Mr. Kim, Mr. Demmo, Matt Guest, Mark Veblen, and Brandon Price.

I. Regulatory Environment Set Stage for Resurgent M&A Activity in 2025 with Bright Outlook for 2026

2025 began with a sense of optimism for a return to a more normalized regulatory environment which — coupled with a continued favorable economic environment — would lay the groundwork for more robust M&A activity for financial institutions. Consistent with our early expectations, the regulatory environment has indeed improved, and there was a spike in M&A activity. Both the regulatory situation and the economy and financial markets remain a work in progress, buffeted by national and global political forces that created periodic volatility and, of late, a sense of uncertainty. Nonetheless, 2025 was a year of major events and progress, with promising early signs for 2026.

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Weekly Roundup: April 17-23, 2026

Posted by the Harvard Law School Forum on Corporate Governance, on
Friday, April 24, 2026

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This roundup contains a collection of the posts published on the Forum during the week of April 17-23, 2026

Statement by Commissioner Peirce on the Costs, Risks, and Privacy Concerns of the Consolidated Audit Trail

Posted by Hester M. Peirce, U.S. Securities and Exchange Commission, on Friday, April 17, 2026
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Statement in Connection with ISS Filing Lawsuit Challenging Indiana Statute, House Bill 1273

Posted by Subodh Mishra, ISS STOXX, on Saturday, April 18, 2026
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Key Considerations for the 2026 Annual Reporting and Proxy Season: Proxy Statements

Posted by Maia Gez, Scott Levi, and Danielle Herrick, White & Case LLP, on Sunday, April 19, 2026
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AI as the New Proxy Advisor: Reshaping Shareholder Activism Communications

Posted by Lyndsey Estin, Nick Capuano, and Mark Fallati, Kekst CNC, on Monday, April 20, 2026
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The (Missing) Relation Between Acquisition Announcement Returns and Value Creation

Posted by Itzhak Ben-David (Ohio State University), on Monday, April 20, 2026
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How a Buyer’s AI Conversations Sank Its Earnout Avoidance Strategy

Posted by Jonathan A. Dhanawade, Frank J. Favia Jr., and Andrew J. Stanger, Mayer Brown LLP, on Monday, April 20, 2026
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Board Equity Ownership and Its Impact on Corporate Performance

Posted by Victoria Tellez (FCLTGlobal) and Jonathan Ponder (MSCI Institute), on Tuesday, April 21, 2026
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What Do Investors Learn in Private Meetings? Evidence from 4,700 Encounters with Portfolio Firms

Posted by Marco Becht (Université Libre de Bruxelles), Julian Franks (London Business School), and Hannes F. Wagner (Bocconi University), on Tuesday, April 21, 2026
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The Proof is in the Proxy: Connecting Governance to Returns

Posted by Bob Herr, Landon Shea, and Peter Højsteen-Ljungbeck, AllianceBernstein, on Tuesday, April 21, 2026
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Early Look: Executive Security Perks on the Rise

Posted by Joyce Chen, Equilar, Inc., on Wednesday, April 22, 2026
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Litigation Against the SEC has Spiked in Recent Years. Why?

Posted by Amanda M. Rose (Vanderbilt Law School), on Wednesday, April 22, 2026
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Speech by Chair Atkins on Reducing Regulatory Burdens and Promoting Market-Driven Capital Formation

Posted by Paul Atkins, U.S. Securities and Exchange Commission, on Wednesday, April 22, 2026
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Early Filers: CEO Compensation Up; Bonus Payout at Target

Posted by Lauren Peek and Joanna Czyzewski, Compensation Advisory Partners, on Thursday, April 23, 2026
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Delaware Supreme Court Rejects Bright Line Rules in Section 220 Books and Records Proceedings

Posted by Michael J. Kahn and Brian Yang, Gibson, Dunn & Crutcher LLP, on Thursday, April 23, 2026
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Delaware Supreme Court Rejects Bright Line Rules in Section 220 Books and Records Proceedings

Posted by Michael J. Kahn and Brian Yang, Gibson, Dunn & Crutcher LLP, on
Thursday, April 23, 2026
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Michael J. Kahn is a Partner and Brian Yang is an Associate Attorney at Gibson, Dunn & Crutcher LLP. This post is based on a Gibson Dunn memorandum by Mr. Kahn, Mr. Yang, Monica K. Loseman, Brian M. Lutz, Jason J. Mendro, and Craig Varnen, and is part of the Delaware law series; links to other posts in the series are available here.

Last week, the Delaware Supreme Court held 3-2 that the Court of Chancery did not err by considering post-demand evidence and anonymous sources when determining whether a stockholder demonstrated a “credible basis” to suspect wrongdoing under Section 220 of the Delaware General Corporation Law.

“The general rule is that when a stockholder seeks relief under § 220, it will be limited to evidence identified in the demand and the information available to the stockholder when the demand was made.  But under exceptional circumstances, the Court of Chancery may, in the exercise of its sound discretion, consider post-demand evidence that is material to the court’s credible-basis inquiry and not prejudicial to the corporation.”

Justice Traynor, writing for the Court

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Early Filers: CEO Compensation Up; Bonus Payout at Target

Posted by Lauren Peek and Joanna Czyzewski, Compensation Advisory Partners, on
Thursday, April 23, 2026
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Lauren Peek is a Partner and Joanna Czyzewski is a Principal at Compensation Advisory Partners. This post is based on their CAP memorandum.

CAP reviewed chief executive officer (CEO) pay levels among 50 companies with fiscal years ending between August and October 2025 (defined as the Early Filers). 2025 financial performance was generally flat to up, which resulted in median bonus payouts of around target. Total compensation for the CEO was up +8% due to an increase in the grant date value of long-term incentives (LTI). This report covers 2025 financial performance, CEO actual pay levels and annual incentive payouts for the Early Filers.

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Speech by Chair Atkins on Reducing Regulatory Burdens and Promoting Market-Driven Capital Formation

Posted by Paul Atkins, U.S. Securities and Exchange Commission, on
Wednesday, April 22, 2026
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Paul S. Atkins is the Chairman of the U.S. Securities and Exchange Commission. This post is based on his recent speech. The views expressed in the post are those of Chairman Atkins and do not necessarily reflect those of the Securities and Exchange Commission or its staff.

Good morning, ladies and gentlemen. David, thank you for your warm words of introduction and for the invitation to join you here at the Economic Club of Washington. Like much of the Club’s membership, your career has been animated by a sense of great civic purpose. And you are no stranger as to how regulatory issues affect the marketplace. So, it is a special pleasure to be with you, and I look forward to our conversation in just a few moments.

Of course, I should also like to thank the market participants and business leaders who are here today, as well as my counterparts from across the Administration. I am grateful for your presence this morning, and for your partnership in the work that we share.

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Litigation Against the SEC has Spiked in Recent Years. Why?

Posted by Amanda M. Rose (Vanderbilt Law School), on
Wednesday, April 22, 2026
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Amanda M. Rose is Cornelius Vanderbilt Chair in Law, Professor of Law, and Co-Director of the Law & Business Program at Vanderbilt Law School. This post is based on her recent article, forthcoming in the Texas Law Review.

The Securities and Exchange Commission is an enormously powerful regulator.  The agency’s power stems, in large part, from its traditional response to a problem endemic in the securities laws.  The problem is that broad and vague statutory prohibitions, backed up by onerous liability, risk chilling market behavior in profoundly undesirable ways.  The SEC’s traditional response to this problem has not been to more clearly delineate what the law affirmatively prohibits, or to reduce liability, but rather to bless certain practices that it deems lawful using a variety of regulatory techniques that tend to elide traditional APA-based accountability mechanisms—e.g., safe harbors, no-action letters, guidance, exemptive relief, the strategic exercise of enforcement discretion.  These techniques allow the SEC to effectively micromanage the capital markets in a manner that (to put it mildly) sits in tension with the Brandeisian vision of the SEC as a hands-off regulator focused primarily on disclosure and fraud prevention.  And for most of its existence, the SEC exercised its vast power with very little legal pushback from market participants.  That has changed—dramatically—in recent years.  Empirical research shows litigation against the SEC jumping significantly in the 2010s and then skyrocketing in the 2020s.  In Suing the SEC, forthcoming in the Texas Law Review, I explore why.

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