Introduction

The 2026 U.S. proxy season marked another period of significant change in shareholder proposal activity. While environmental and social (E&S) proposal volumes continued to decline sharply, governance-related proposals proved more resilient, increasing modestly from the prior year and accounting for a larger share of overall shareholder-sponsored resolutions. These developments unfolded against an evolving regulatory backdrop following changes to the SEC staff’s approach to shareholder proposal exclusions, as well as a broader reassessment of stewardship priorities by both proponents and investors. Voting outcomes suggest that shareholders remain willing to support proposals linked to established governance principles, while support for most E&S proposals remains well below their early 2020s peak despite signs of stabilization in certain issue areas. Together, these trends provide insight into how many investors are calibrating their issuer engagement and voting approaches amid changing market, regulatory, and political dynamics.

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The choice of state of incorporation used to be handled quietly at formation or IPO and rarely revisited. Even as a handful of high-profile companies and commentators began questioning Delaware’s judge-made law and domicile dominance in 2024, it was unclear whether the sentiment would be temporary or make corporate domicile a more consequential decision.

For now, the latter appears more likely. In the past two years, 50+ public companies have reincorporated out of Delaware, while the First State’s share of the IPO market dropped from 81% in 2024 to “nearly 70%” in 2025. More recently, certain prominent companies have chosen Texas as their state of incorporation and are using the state’s statutory tools to tailor stockholder rights. Although very few widely held large-cap public companies have moved out of Delaware, the trend is more pronounced among founder-led companies or companies with large influential shareholders. The topic is drawing attention in proxy statements, academic journals and the financial press.

Once a company is public and widely held, reincorporation becomes much tricker, as proxy advisory firms have generally opposed moves to Nevada and Texas, and large institutional shareholders have also often opposed reincorporations, resulting in difficult shareholder votes for noncontrolled companies. For a founder-led technology company, where to incorporate is a strategic governance decision. This post offers factors to help companies and their advisors evaluate three prominent options: Delaware, Nevada and Texas. Contact your Cooley counsel to apply these factors to your company’s circumstances.

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Shareholder Voting

This summary is focused on 14a-8 proposals that were voted on by shareholders during the 2025-2026 season through June 30, 2026.

Voting Analytics 2025/2026

We define the 2025-2026 season as annual shareholder meetings held between July 1, 2025 and June 30, 2026, the 2024-2025 season as meetings held between July 1, 2024 and June 30, 2025, and the 2023-2024 season as meetings held between July 1, 2023 and June 30, 2024.

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This article is the sequel to the author’s previous articles entitled Merger Agreements are Too Long and Disclosure Schedules are a Waste of Money.

When transaction parties draft M&A disclosures, they can almost always add more detail.  They have to make judgments about what information would matter to a reasonable stockholder.  Many months of negotiations may get summarized in a “highlight reel” of just a few pages describing the background of the transaction, and many spreadsheets worth of calculations and assumptions underlying financial projections may get presented in a few tables.

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This post is the first part of D.F. King’s 2026 Proxy Season debriefing report.

Shareholder Proposals

Proposals submissions on the decline, support remains steady.

• Total number of proposals filed in 2026 is down nearly 25% from 2025 and is at the lowest level we have seen over the past decade.
• Governance proposal numbers surged, while Environmental, Social and Compensation-related proposals saw decreased numbers across the board.
• Majority of top shareholder proposal types submitted experienced steady, if not increased, support levels.

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In Short

The Situation: On August 14, 2026, the SEC’s Division of Corporation Finance (the “Division”) announced it will no longer respond to companies’ “no-objection” requests under Rule 14a-8, effective immediately. The Division also stated it would no longer respond to Rule 14a-8 “no-action” requests under Rule 14a-8(i)(1) (the “improper under state law” exclusion), effective immediately. With this final step, the Division ended decades of informal staff guidance on shareholder proposal exclusions.

The Result: To exclude shareholder proposals from its proxy materials, a company will still need to comply with Rule 14a-8(j)’s notice requirements by filing an explanation of why the company believes that it may exclude the proposal with the Commission at least 80 calendar days before filing its definitive proxy statement.

Looking Ahead: Although the shareholder proposal process has evolved significantly in the past two years, companies should brace for more change. Not only does “Shareholder Proposal Modernization” remain on the SEC’s Reg Flex Agenda, but Chair Atkins has also stated his view that shareholder proposals may be more appropriately governed by state law. Taken together, these developments reflect a steady erosion of the SEC’s historic role in the shareholder proposal process.

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Two leading consulting and expert firms – Cornerstone Research and NERA – recently released reports on securities class action filings and settlements in the first half of 2026. Both reported a notable upturn in filing activity and meaningful increases in alleged investor losses and settlement values.

Cornerstone’s reports observed a significant rise in the number of filings and potential investor losses compared to H2 2025, driven by filings related to AI, as well as an increase in both the number and value of settlements. NERA’s report – which covers both case filings and resolutions – observed a slight decline in securities class action dismissals. Both firms also identified new filing trends involving tariff-related allegations and pump-and-dump market manipulation, discussed further below.

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This post is based on a comment letter submitted to the SEC regarding the SEC’s proposal on Enhancement of Emerging Growth Company Accommodations and Simplification of Filer Status for Reporting Companies, by 115 signatories, including professors, former regulators, and accounting and audit practitioners. Below is the text of the letter with minor adjustments to eliminate the correspondence-related parts, followed by the full list of signatories.

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Each year, CAP analyzes non-employee director compensation programs among the 100 largest US public companies. These companies are trendsetters and can provide early insights into evolving pay practices across the broader public company marketplace. This report reflects a summary of pay levels, pay practices, and trends based on the most recent (2026) proxy disclosures for these 100 companies.

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Key Takeaways

• Cybersecurity oversight is now nearly universal at large cap companies. Defined board oversight of AI is emerging quickly, but still lags behind.
• Shareholder voting on board elections remained largely consistent in North America.
• While average opposition levels remained minimal among large European companies, instances of significant voting dissent on director elections more than doubled.
• Most large-cap European and UK companies met new rules on gender balance, however, executive diversity remains below board-wide levels across Europe.
• Board racial/ethnic diversity increased among North American and UK companies, but the trend of fewer U.S. companies providing aggregate or individual director reporting continued.

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On August 11, 2026, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) issued a final rule (the “Final Rule”) that permanently removes the requirement for US companies and US persons to report beneficial ownership information (“BOI”) to FinCEN under the Corporate Transparency Act (the “CTA”). The Final Rule was published in the Federal Register on August 14, 2026, and became effective immediately upon publication.

The Final Rule adopts all of the changes made on an interim basis in the interim final rule issued on March 26, 2025 (the “IFR”) as permanent changes. As discussed in our prior Legal Update, such changes narrowed FinCEN’s beneficial ownership information reporting requirements to apply only to foreign entities registered to do business in the United States. Specifically, the Final Rule confirms the elimination of reporting obligations for millions of US small businesses, resolves open questions flagged in our prior Legal Updates regarding FinCEN identifiers and company applicants, and announces the planned deletion of previously reported US person data from FinCEN’s BOI IT system (the “BOI IT System”). The Secretary of the Treasury’s issuance of the Final Rule cements its exercise of statutory exemptive authority under the CTA and the Bank Secrecy Act more generally.

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While many of the practices discussed are, and should remain, prominent components of pay programs, shifting investor preferences and macroeconomic challenges make this a good time for compensation committees to review their current programs and ensure they’re still the best option to drive both pay-for-performance alignment and long-term value creation. In this article, we take a comprehensive, thought-provoking look at areas of the executive pay status quo to explore why they became industry standards, how you can determine if they’re right for your organization, and several alternative models that are emerging.

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The 2024 and 2025 reforms of Delaware corporate law passed with unprecedented speed, and Texas and Nevada now compete in an overt race to laxity. Whatever one makes of these developments, most of the existing contestation focuses on the effects on agency costs and shareholder value. That is the vocabulary prevailing frameworks make available, and it is a weak hand to play when stock prices are rising. In a new essay, Deprogramming Corporations, I examine how this impoverished vocabulary is a product of the dominant lenses I call “programming”: prevailing analytical frameworks that artificially narrow corporate law’s scope in ways that misdescribe real-world developments and foreclose normative contestation.

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On August 13, 2026, in In re The Boeing Co. Derivative Litigation, Justice Morgan T. Zurn, recently appointed to the Delaware Supreme Court and sitting by designation in the Delaware Court of Chancery, dismissed Caremark failure of oversight claims asserted against current and former directors and employees of The Boeing Company.[1] Granting defendants’ motion to dismiss in full and with prejudice, the Court emphasized the deference accorded to directors of Delaware corporations under the business judgment rule and held that liability under Caremark does not arise where directors reasonably believe they are fulfilling their oversight duties.[2] S&C represents Boeing and the director and employee defendants in the litigation.

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The proxy landscape is becoming more complex and less predictable.

In brief

• Regulatory and stewardship shifts are making investor signals harder to read and proxy voting outcomes harder to predict.
• Boards may need to evaluate whether their oversight structures and disclosures reflect growing expectations around AI governance.
• Directors should reassess investor engagement strategies, governance practices and board readiness for a rapidly evolving environment.

Headline voting results from the 2026 proxy season reflect relative calm: continued high support for directors, hardly any failed say-on-pay votes and a sharp decline in shareholder proposals reaching the ballot. Yet those results mask a more complex reality.

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On July 29, 2026, the Delaware Court of Chancery dismissed with prejudice the stockholders’ complaint in Drakes Landing Associates, L.P. v. Tilden Park Capital Management, L.P.,[1] holding that the plaintiffs failed to rebut the statutory safe harbor for directors of a public benefit corporation (PBC). This is the first Delaware Chancery decision to address the balancing test of PBC director fiduciary duties in a change-of-control context.

The dispute arose out of a financing transaction at MPower Financing, PBC, a Delaware PBC (the “Company”), in which two of the Company’s largest lenders obtained control of the Company. The plaintiffs alleged that the special committee formed to evaluate the transaction, although independent and disinterested, nonetheless breached its fiduciary duties and that the lenders aided and abetted the breach. The Court found that the plaintiffs failed to plead facts sufficient to rebut the safe harbor protecting PBC directors under DGCL Section 365(b). The Court also addressed the applicability to PBCs of Revlon, concluding that the duty to maximize the sale price of a corporation does not apply to the conduct of PBC directors, but leaving open the question of whether a modified form of enhanced scrutiny might still apply as a standard of review.

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Class of 2026: S&P 500 boards appoint more CEOs

Board refreshment slows

S&P 500 boards appointed 364 new independent directors in 2026, out of a total of 5,204 — the lowest number of new directors since 2016. Overall turnover remains low, declining from 0.8 new directors per board last year to 0.7 in 2026.

In previous years, declines in director appointments generally mirrored the number of directors leaving boards. For example, 374 directors departed S&P 500 boards in 2024, matching the number of new director appointments in 2025. That pattern did not continue in 2026: 418 directors left boards  last year, 15% higher than this year’s appointments.

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In December 2025, Vice Chancellor Will dismissed a derivative claim against a director whose sexual harassment of employees had produced roughly $1.6 million in liability for the corporation. Such “interpersonal” conduct, she held in Brola v. Lundgren, was “not a matter of corporate internal affairs,” and “[t]he legal system provided a remedy for his wrongdoing through New York’s employment laws.” She warned against turning the duty of loyalty into “a general morality code” and inviting “doctrinal sprawl” that would reach “a breakroom fistfight, a defamatory social media post, or theft of office supplies.”

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In a pair of recent decisions, the Delaware Superior Court and the New York State Supreme Court each dismissed with prejudice nearly identical cases brought against the First Eagle and JPMorgan mutual fund complexes, respectively, relating to their application of industry standard accounting practices. Putting forth an unusual theory under the Securities Act of 1933 (the “Securities Act”), the lawsuits alleged that certain mutual funds’ registration statements were misleading because they failed to disclose that, under the funds’ accounting practices, the funds’ realized income and capital gains were temporarily treated as assets (rather than liabilities) prior to those earnings being distributed to fund shareholders (typically on a quarterly or annual basis). Plaintiffs argued that this allegedly undisclosed practice artificially inflated the funds’ NAV, which caused investors to suffer various forms of harm, including higher asset-based fees and increased tax liabilities. However, plaintiffs’ theories were not grounded in the relevant accounting guidance (ASC 946-320-25-4[1]), which does not (i) require that earnings be immediately classified as liabilities, or (ii) prescribe how frequently a fund should declare distributions.

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