USA Trends and Developments Contributed by: Piotr Korzynski, Mark Mandel, Michael Pilo and Carol Stubblefield, Baker McKenzie
Upending shareholder proposal practice In late 2025, the SEC upended its longstanding approach to regulating the exclusion of shareholder proposals by public companies from their annual meeting proxies under Exchange Act Rule 14a-8. Spe - cifically, public companies had generally sought no- action letters from the SEC staff effectively confirming the action the company took to exclude shareholder proposals under Rule 14a-8. The SEC staff largely retreated from that practice and substantive review of most Rule 14a-8 no-action requests, which pro - duced a more cautious and decentralised 2026 proxy season. Although the change might initially have appeared company-friendly as an act of deregulation, the prac - tical impact has been more balanced: shareholders appear to have submitted fewer proposals, and com - panies have also filed significantly fewer exclusion notices under Rule 14a-8, reflecting reluctance to exclude proposals without substantive staff concur - rence. Public companies have responded by allow - ing proposals to proceed, negotiating withdrawals or relying only on clearer exclusion grounds, while pro - ponents have shifted their leverage toward investor engagement, proxy adviser scrutiny, public pressure and litigation risk. As a result, the 2025–26 proxy season has under - scored that the absence of staff review does not sim - ply make exclusion easier; it moves more of the legal, reputational and strategic burden to boards, counsel, investors and, where disputes escalate, the courts. If the SEC staff maintains its 14a-8 no-action policy for the 2026–27 proxy season, a similar dynamic is likely to play out. Tender offers may move faster The most concrete and impactful recent effective change is the SEC staff’s April 2026 exemptive order permitting certain qualifying equity tender offers to remain open for ten business days instead of the tra - ditional 20 business days. The relief applies only in a defined set of circumstances, including fixed-price, all-cash offers, and it is not available for hostile bids, going-private transactions or competing-offer situ - ations. For negotiated public company acquisition structures, however, the order is significant because
• Second, activism remains intense, but activist methods are evolving: settlements, “vote no” cam - paigns and M&A-focused demands are increas - ingly important alongside traditional proxy fights. • Third, Delaware’s responses to “DExit” pressure have not ended the debate over corporate domi - cile, though incorporation data continues to point to Delaware as the primary state for US corporate formation; instead, the responses have sharpened the differences between Delaware, Texas and Nevada. • Finally, boards are under growing pressure to show that they can govern fast-moving risks, especially those associated with artificial intelligence, in a disciplined and credible way. SEC Developments: More Flexibility, But Also More Responsibility One of the clearest governance themes of 2026 is that the SEC and its staff are trying to modernise aspects of the public company rulebook while also shifting more responsibility back to boards, management teams and advisers. That trend is visible across quar - terly reporting, shareholder proposals, tender offers and deal practice. The net effect is not “deregulation” in a simple sense. Rather, it is a move away from one- size-fits-all process requirements toward a regime in which boards and deal teams may have more room to move, but also more judgement calls to make. Optional quarterly reporting Among the most concrete recent proposed rule changes is the SEC staff’s May 2026 proposed quar - terly reporting rule and filing form amendments. If adopted, the amendments would give public compa - nies the option of filing semi-annual reports in lieu of quarterly reports to meet their interim reporting obliga - tions under the federal securities laws. In effect, this would allow public companies to opt out of a quarterly reporting regime that has been in place since 1970. The rule changes would give qualifying public compa - nies and their boards greater room to determine the appropriate cadence for interim reporting based on their particular circumstances. In making that judge - ment, boards would need to balance the costs and burdens of more frequent reporting against the expec - tations of their investors and financing sources.
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