Summary
On September 16, 2026, the Securities and Exchange Commission (the “SEC”) proposed significant changes to the federal proxy rules, including the rescission of Rule 14a-8 under the Securities Exchange Act of 1934, which governs when companies must include shareholder proposals in their proxy materials. The SEC also proposed separate amendments intended to modernize and simplify the proxy solicitation process.
If adopted, the proposals would significantly change the shareholder proposal process and several requirements applicable to public companies in connection with annual meetings and proxy solicitations.
Proposed Rescission of Rule 14a-8
The SEC has proposed rescinding Rule 14a-8 in its entirety. Rule 14a-8 currently establishes the federal framework under which qualifying shareholders may require a company to include a shareholder proposal in its proxy materials, subject to specified procedural and substantive requirements.
If the proposal is adopted, whether and how shareholders may submit proposals for consideration at shareholder meetings would instead be determined principally by applicable state law and a company’s charter, bylaws, and other governing documents.
In connection with the proposed rescission, the SEC also proposed amendments to Rule 14a-4(c) that would provide companies with greater flexibility to exercise discretionary voting authority over certain shareholder proposals that are not included in the company’s proxy materials, while providing shareholders a mechanism to prevent the company from exercising such authority with respect to their shares.
Proposed Proxy Solicitation Reforms
In a separate proposal, the SEC proposed several changes intended to modernize the proxy solicitation process, including:
- Eliminating the requirement to furnish an annual report to shareholders in connection with certain proxy solicitations;
- Eliminating the 20-business-day advance delivery requirement for proxy statements that incorporate information by reference;
- Eliminating the filing and use of Notices of Exempt Solicitation; and
- Reducing the minimum broker search period from 20 business days to five business days.
The proposals have not yet been adopted, and companies remain subject to the existing proxy rules, including Rule 14a-8. Comments on each proposal will be due 60 days after publication in the Federal Register.
Public companies should monitor these developments and, if the rescission of Rule 14a-8 is ultimately adopted, consider reviewing their governing documents and applicable state law provisions relating to shareholder proposals and shareholder meetings.
If you have any questions regarding these proposals or their potential impact on your company’s proxy and annual meeting practices, please contact a member of McCarter & English’s Corporate Practice Group.
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