On September 16, 2026 the Securities and Exchange Commission (the “SEC”) issued two separate proposing releases related to its proxy rules under the Securities Exchange Act of 1934. The first would rescind Rule 14a-8 and amend Rule 14a-4(c) (the “Rule 14a-8 Rescission Proposal”). The second would modernize several aspects of the proxy solicitation process (the “Proxy Solicitation Modernization Proposal” and, together with the Rule 14a-8 Rescission Proposal, the “Proposals”). Each Proposal is summarized in further detail below.
Rule 14a-8 Rescission Proposal
The Rule 14a-8 Rescission Proposal would rescind, in its entirety, Rule 14a-8, the longstanding SEC rule enabling an eligible shareholder to include a proposal in the company’s annual shareholder meeting proxy materials subject to certain procedural and substantive requirements. The Rule 14a-8 Rescission Proposal follows the Division of Corporation Finance’s August 14th announcement that it would withdraw from its traditional role in the Rule 14a-8 process. The proposed rescission would apply to all companies, including registered investment companies and business development companies.
The SEC proposes to rescind Rule 14a-8 on the basis that the rule exceeds the scope of the SEC’s statutory authority and improperly intrudes into state corporate law without express Congressional authorization. Rule 14a-8 has, as expressed by many observers, effectively evolved to function as a body of federal common law concerning what constitutes a proper subject for shareholder action.
If Rule 14a-8 is rescinded, the federal proxy rules would no longer require companies to include in their proxy materials shareholder proposals based on federally established procedural and substantive requirements. Instead, state corporate law or, if permitted by state law, a company’s governing documents would determine whether a shareholder proposal would be required to be included in a company’s proxy materials.
The Rule 14a-8 Rescission Proposal would also amend Rule 14a-4(c), which addresses when a company may exercise discretionary voting authority over matters raised at a shareholder meeting but not included in the company’s proxy statement. The proposed amendments would expand a company’s ability to exercise such authority over shareholder proposals submitted outside of Rule 14a-8 and omitted from the company’s proxy materials, regardless of whether the shareholder proponent timely submits the shareholder proposal to the company or delivers its own proxy materials to holders. Under the Rule 14a-8 Rescission Proposal, companies could vote proxies received on such proposals if they include (i) a brief description of the proposal and how the company intends to vote on the matter in the proxy statement, (ii) a cross-reference to this disclosure on the proxy card, and (iii) a check box on the proxy card allowing a shareholder to prevent the company from using discretionary voting authority. The proposed amendments would require only one checkbox on the proxy card, even if multiple proposals have been submitted, though companies may voluntarily include additional checkboxes.
As described in the Rule 14a-8 Rescission Proposal, these changes are intended to reduce pressure on companies to include non-Rule 14a-8 proposals in their proxy materials, particularly following the adoption of the universal proxy rules, while shifting control over discretionary voting authority from shareholder proponents to individual shareholders.
Proxy Solicitation Modernization Proposal
The Proxy Solicitation Modernization Proposal would update several rules governing the proxy solicitation process with the goal of accounting for developments since the rules were last adopted or amended, reducing compliance burdens for registrants, and reducing investor confusion. Among other things, the Proxy Solicitation Modernization Proposal would:
- Eliminate the Delivery Requirement for Annual Reports to Security Holders: Given the redundancy in information required by annual reports to security holders (“ARS”) and Form 10-K, registrants that have already filed their Form 10-K on EDGAR for their most recent fiscal year before sending the proxy statement would no longer be required to deliver an ARS. The requirement to include the stock performance graph in the ARS per Regulation S-K Item 201(e), which most companies include in their Form 10-K, would also be eliminated for all registrants other than investment companies.
- Eliminate the Delivery Deadline for Proxy Statements that Incorporate Information by Reference: The requirement to send proxy statements that incorporate information by reference from other filings at least 20 business days before the shareholder meeting would be removed in light of the accessibility of such filings on EDGAR. The same change would apply to the corresponding requirement in Forms S-4 and F-4 as well as information statements on Schedule 14C.
- Eliminate the Requirement (and Ability) to Submit a Notice of Exempt Solicitation: Rule 14a-6(g), which currently requires large shareholders to submit a Notice of Exempt Solicitation on EDGAR if they conduct certain exempt written solicitations, would be rescinded. This follows the SEC Staff’s guidance issued in January 2026 that it would object to any voluntary submission of a Notice of Exempt Solicitation in light of certain abuses of such voluntary submissions.
- Shorten the Minimum Broker Search Period: Given technological advancements, the minimum broker search period would be reduced from 20 business days to 5 business days with the goal of reducing delays, costs, and uncertainty in transactions and proxy contests.
- Require Contact Information on Proxy and Information Statement Cover Pages: Cover pages for Schedules 14A and 14C would be required to include the name, address (mailing or email), and telephone number of a representative who can respond to questions regarding the filing.
