SEC Chairman Signals Reassessment of Rule 14a-8 Regime

In his remarks at the 2026 Society for Corporate Governance Conference, SEC Chairman Paul Atkins outlined one of the central tenets of his policy agenda: to restore the “foundation” of the SEC’s original mandate on requiring the disclosure of “material” information. The speech addressed a number of significant topics, including the SEC’s ongoing review of Regulation S‑K, the notion of a potential overarching materiality qualifier—or a “materiality overlay”— that would permit companies to omit information otherwise called for by Regulation S-K if such information is not material, and the Chairman’s concerns regarding the broad proliferation of disclosures that are unhelpful to companies and their investors.

Chairman Atkins also devoted significant attention to Rule 14a‑8 and the shareholder proposal process. He noted that the SEC’s decision not to respond to companies’ no-action requests during the 2025-2026 proxy season “did not create the chaos that many feared.” Pointing to statistics indicating that proposal exclusion trends remained consistent with prior years, that only six lawsuits were filed against companies for excluding a proposal, and that proxy advisors did not penalize most companies that excluded proposals, he concluded that “the Commission staff’s interposition between companies and shareholder proponents is unnecessary to effectively and efficiently resolve whether shareholder proposals should be included in proxy statements.” Chairman Atkins stated that he would not direct SEC Staff to return to the tedious task of issuing no‑action letters and characterized the Staff’s withdrawal from the process as the removal of “the training wheels from the shareholder proposal bicycle.”

Notably, Chairman Atkins also disclosed that the SEC is holistically reevaluating Rule 14a-8 itself. Echoing views he expressed in previous remarks, he questioned whether Rule 14a‑8 may inappropriately infringe upon state corporate laws and noted that decades of amendments have added complexity to the rule without adequately addressing the fundamental question of the federal government’s proper role in the shareholder proposal regime. He also asserted that corporate annual meetings should not continue to serve as vehicles for political or social debates and implored companies not to allow shareholder proposals to be “weaponized by those who represent fringe interests.” He noted that, in the 2025-2026 proxy season, one single individual was responsible for approximately 41% of shareholder proposals that were voted on, while only 8% of his proposals received majority support. Chairman Atkins referred to this status quo as the “tyranny of the minority.”

Absent additional rulemaking from the SEC, companies should expect Rule 14a-8 proposals to continue to proliferate during the 2027 proxy season. Companies facing such proposals should carefully consider, and discuss with counsel, whether there is a reasonable basis for exclusion, and how to mitigate the risk of litigation and negative recommendations from proxy advisors, given the absence of input from the SEC.