Yearly Archives: 2026

Effective Board Oversight of Sustainability Strategy

Posted by Ray Garcia, Kathy Nieland, and Tracey-Lee Brown, PricewaterhouseCoopers LLP, on
Tuesday, May 19, 2026
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Ray Garcia is a Partner and Leader, Kathy Nieland is a Partner, and Tracey-Lee Brown is a Director at the Governance Insights Center, PricewaterhouseCoopers LLP. This post is based on a PwC memorandum by Mr. Garcia, Ms. Nieland, Ms. Brown, and Gregory Johnson.

Our Sustainability oversight: the corporate director’s guide addresses the broad sustainability landscape, the role of the board in overseeing sustainability, and how boards are organizing themselves. This installment of our sustainability oversight series highlights specific actions boards can take to respond to the current environment, with a focus on identifying which sustainability topics merit board focus because of their strategic significance and impact on long-term value.

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Recent Shareholder Proposal Litigation Underscores the Need for Shareholder Proposal Reform

Posted by Ferrell Keel, Joel May, and Kim Pustulka, Jones Day, on
Tuesday, May 19, 2026
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Ferrell Keel, Joel May, and Kim Pustulka are Partners at Jones Day. This post is based on a Jones Day memorandum by Ms. Keel, Mr. May, Ms. Pustulka, David Peavler, and Randi Lesnick.

In Short

The Situation: Since the U.S. Securities and Exchange Commission announced in November 2025 that it would no longer rule on most Rule 14a-8 no-action requests, companies have taken varying approaches to shareholder proposals that continued to be pressed by social mission organizations, public employee unions, retirement systems, and others across the political spectrum. Some added the proposals to their proxy materials, some declined. Six proponents filed suit against companies, arguing that their proposals were improperly excluded.

The Result: While half of the six lawsuits settled, the other half resulted in court decisions that turned on the “ordinary business” exclusion under Rule 14a-8(i)(7)—but with seemingly divergent outcomes.

Looking Ahead: The lawsuits underscore the unworkability of Rule 14a-8 and may provide ammunition to those calling for sweeping reform or outright rescission of Rule 14a-8 as part of the SEC’s anticipated “Shareholder Proposal Modernization” rulemaking. Rescission would shift the issue to state law.

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The Current Strategic Landscape for Investment Stewardship

Posted by Rickard Nilsson, Glass, Lewis & Co., on
Monday, May 18, 2026
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Rickard Nilsson is Director of Stewardship at Glass, Lewis & Co. This post is based on his Glass Lewis memorandum.

Key Takeaways

  • Glass Lewis 2026 Investment Stewardship Survey respondents report that their engagement priorities are anchored in climate change and governance.
  • Regional patterns show European investors emphasizing sustainability topics more strongly, while North American investors place greater weight on traditional governance issues.
  • A hybrid approach to stewardship has become the dominant operating model, balancing broad baseline expectations with targeted company-specific engagement.
  • Engagement prioritization reflects a multi-factor approach, with policy alignment most common but investors also weighing factors such as materiality, ownership levels, and resource capacity.
  • Efforts to improve stewardship quality are framed around stronger links to investment decision-making, better prioritization and research, credible escalation strategies, and more effective outcomes reporting.

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SEC Proposes Semiannual Reporting Framework

Posted by Ryan Adams, Scott Lesmes, and Larry Medvinsky, Morrison & Foerster LLP, on
Monday, May 18, 2026
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Ryan Adams, Scott Lesmes, and Larry Medvinsky are Partners at Morrison & Foerster LLP. This post is based on a MoFo memorandum by Mr. Adams, Mr. Lesmes, Mr. Medvinsky, and Sydney Stancik.

On May 5, 2026, the U.S. Securities and Exchange Commission (SEC) released its highly anticipated proposal (the “Proposal”) to allow reporting companies under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to adopt a semiannual reporting framework instead of quarterly reporting. Under the Proposal, companies that elect to take advantage of the semiannual reporting regime would use new Form 10-S in lieu of Form 10-Q.

The Proposal also includes changes to Regulation S-X to reflect the new optional semiannual reporting approach, as well as technical amendments to numerous existing rules and forms that refer to quarterly reporting to incorporate the new semiannual framework.

See the SEC’s release. Public comments will be open until 60 days after the date of publication of the proposing release in the Federal Register.

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Court Order Signals New Era for Shareholder Proposals Under Rule 14a-8

Posted by Eric Juergens, William D. Regner, and Amy Pereira, Debevoise & Plimpton LLP, on
Sunday, May 17, 2026
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Eric Juergens and William D. Regner are Partners and Amy Pereira is an Associate at Debevoise and Plimpton LLP. This post is based on a Debevoise memorandum by Mr. Juergens, Mr. Regner, Ms. Pereira, Matthew E. Kaplan, and Maeve O’Connor.

A recent federal court decision compelling a public company to include a shareholder proposal in its proxy materials illustrates the importance of shareholder engagement following changes to the Securities and Exchange Commission’s administration of Rule 14a-8.

Pension Fund Obtains Preliminary Injunction. In Thomas P. DiNapoli v. BJ’s Wholesale Club Holdings, Inc., a New York public pension fund obtained a preliminary injunction requiring BJ’s Wholesale Club Holdings, Inc., a regional membership-only warehouse club chain, to include the fund’s shareholder proposal in its proxy statement. The proposal requests that the company conduct and disclose an assessment of deforestation risks associated with its private label brands.

In February 2026, BJ’s notified the SEC’s Division of Corporation Finance that it intended to exclude the fund’s proposal from its proxy materials for the 2026 meeting, asserting that the proposal was excludable under the “ordinary business exclusion” of Rule 14a-8(i)(7). In response, the Division confirmed that it would “not object if the Company excludes the Proposal from its proxy materials.”

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SEC’s Recent Public Company Settlement Provides Guidance for Corporate Resolutions Under the Current Administration

Posted by Anita Bandy, Andrew Lawrence, and Mayra Suárez, Skadden, Arps, Slate, Meagher & Flom LLP, on
Saturday, May 16, 2026
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Anita Bandy and Andrew Lawrence are Partners and Mayra Suárez is Counsel at Skadden, Arps, Slate, Meagher & Flom LLP. This post is based on a Skadden memorandum by Ms. Bandy, Mr. Lawrence, Ms. Suárez, and Hannah Henderson.

Executive Summary

  • What’s new: The SEC filed a settled enforcement action against a company and two executives in connection with books-and-records and internal accounting controls failures, notably imposing no corporate penalty despite a lack of self-reporting.
  • Why it matters: The settlement underscores that while the SEC is stepping away from untested theories for charging internal controls violations, the agency is continuing to pursue “back-to-basics” financial reporting issues against companies and their executives, even when the conduct does not result in material errors.
  • What to do next: Companies will want to consider if they have robust accounting controls and policies that are consistently followed, and when internal controls uncover a potential issue, company management and audit committees should review and remediate promptly.

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SEC Proposes to Implement Optional Semiannual Reporting

Posted by H. Rodgin Cohen, Robert W. Downes, and Mario Schollmeyer, Sullivan & Cromwell LLP, on
Friday, May 15, 2026
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H. Rodgin Cohen is a Senior Chair and Robert W. Downes and Mario Schollmeyer are Partners at Sullivan & Cromwell LLP.  This post is based on a Sullivan & Cromwell memorandum by Mr. Cohen, Mr. Downes, Mr. Schollmeyer, Benjamin H. Weiner, Evan S. Simpson, and Kethan T. Dahlberg.

Summary

On May 5, 2026, the Securities and Exchange Commission released a proposed rule that would provide companies currently subject to the SEC’s quarterly reporting requirements with the option to instead file interim reports semiannually on new Form 10-S.

  • Form 10-S would require the same types of disclosures as current Form 10-Q, but would cover a fiscal six-month period rather than a fiscal quarter.
  • The proposed rule would not change interim reporting requirements for foreign private issuers, which continue to be required to prepare interim reports in compliance with home country and stock exchange rules.
  • Comments are due 60 days after the proposed rule is published in the Federal Register.
  • If the proposed rule is adopted, we expect many issuers that adopt semiannual reporting, at least initially, to continue to release material financial information on a quarterly basis to, among other things, encourage investor dialogue, promote access to capital markets and facilitate the opening of trading windows for share repurchases and insider purchases and sales.

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Weekly Roundup: May 8-14, 2026

Posted by the Harvard Law School Forum on Corporate Governance, on
Friday, May 15, 2026

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This roundup contains a collection of the posts published on the Forum during the week of May 8-14, 2026

Prevalence of CEO Personal Security Perquisites Continues to Rise

Posted by Kyle Eastman and Gray Broaddus, Compensation Advisory Partners, on Friday, May 8, 2026
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Remarks by Chairman Atkins on AI Innovation, Capital Markets, and Regulatory Flexibility

Posted by Paul Atkins, U.S. Securities and Exchange Commission, on Saturday, May 9, 2026
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Remarks by Chairman Atkins on the Role of Economic Analysis in Financial Market Regulation

Posted by Paul Atkins, U.S. Securities and Exchange Commission, on Sunday, May 10, 2026
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Uneasy Handshakes: Observations on Informal Settlements in Shareholder Activism

Posted by Sergi Corbatera, DEF 14 Inc., on Monday, May 11, 2026
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AI Corporate Governance and Ben & Jerry’s Risk

Posted by Jesse Fried (Harvard Law School) and Idan Reiter (Harvard Law School), on Monday, May 11, 2026
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From Principles to Practice: Governing AI in the Corporation

Posted by Matteo Tonello, The Conference Board, Inc., on Monday, May 11, 2026
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Control Issues: Delaware Holds Parties to Their Bargain in Recent Governance Decisions

Posted by Adam Magid, Douglas Mo, and Peter Bariso, Cadwalader, Wickersham & Taft LLP, on Tuesday, May 12, 2026
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Special Equity Awards: Navigating Governance Considerations

Posted by Kenneth Sparling, FW Cook, on Tuesday, May 12, 2026
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Delaware Law Permits Companies to Adopt Mandatory Arbitration Clauses for Federal Securities Claims

Posted by Doru Gavril and Mia Tsui, Freshfields US LLP, on Wednesday, May 13, 2026
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Not New: A Response to Claims About “New Control” in Control and its Discontents

Posted by Hon. J. Travis Laster, Delaware Court of Chancery, on Wednesday, May 13, 2026
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CEO/Chair Leadership: When and Why Boards Combine or Separate the Roles

Posted by Matteo Tonello, The Conference Board, Inc., on Wednesday, May 13, 2026
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Recent Developments Affecting US Public Companies and Boards

Posted by Julia Thompson, Keith Halverstam, and Jenna Cooper, Latham & Watkins LLP, on Thursday, May 14, 2026
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Beyond Deregulation Simplification as Institutional Design

Posted by Maria Lucia Passador (Bocconi University), on Thursday, May 14, 2026
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2026 Comparison of Key Corporate Governance Features in the Cayman Islands, Delaware, Nevada, and Texas

Posted by James Crowe, Council of Institutional Investors, on Thursday, May 14, 2026
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2026 Comparison of Key Corporate Governance Features in the Cayman Islands, Delaware, Nevada, and Texas

Posted by James Crowe, Council of Institutional Investors, on
Thursday, May 14, 2026
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James Crowe is the Research Manager at the Council of Institutional Investors. This post is based on his Council of Institutional Investors Research and Education Fund memorandum.

This resource offers a high-level comparison of jurisdictional approaches among Delaware, Nevada, Texas and the Cayman Islands. The table summarizes critical corporate governance and shareholder rights differences such as director and officer liability, fiduciary duties, and shareholder litigation rights, highlighting how specific features impact corporate oversight and investor protections.

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Beyond Deregulation Simplification as Institutional Design

Posted by Maria Lucia Passador (Bocconi University), on
Thursday, May 14, 2026
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Maria Lucia Passador is an Assistant Professor of Corporate Law and Financial Markets Regulation at the University of Bocconi. This post is based on her recent article, forthcoming in the American Journal of Comparative Law.

Calls for “simplification” have become the anthem of modern financial regulation. Everyone seems to want it: legislators, regulators, firms, investors, policy commentators. The promise is always appealing. Simplify the rules, reduce the burden, make the system easier to navigate. But in finance, as in law more generally, what sounds obvious is often misleading. Simplicity is rarely simple.

My paper begins from a basic observation: in contemporary financial regulation, simplification is too often misunderstood as reduction. That is the conventional picture. We imagine a dense thicket of rules and assume that simplification means cutting some of them away. But that picture does not survive contact with reality. In the real architecture of financial governance, complexity is seldom abolished. It is reorganized, translated, relocated, and made to appear more manageable. The paper’s central claim is therefore straightforward: simplification should be understood not as the opposite of complexity, but as a way of governing complexity. READ MORE »

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