All indications are that we are in for a very active 2026 on the regulatory front, as the SEC ramps up its rulemaking efforts and continues issuing new guidance. Given all of the expected developments, you will not want to miss out on any of our latest updates, practical guidance, insights or invaluable content across all of our publications. Be sure to stay up to date with the latest securities regulation and corporate governance developments as we head into 2026 by maintaining uninterrupted access to insights from your favorite CCRcorp editors and contributors.
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Last week, the proxy advisory firm Glass Lewis released its 2026 Benchmark Proxy Voting Policies for Canada, Continental Europe, the United Kingdom and the United States, as well as Supplementary Guidance outlining the Glass Lewis approach to specific situations. As this Goodwin Public Company Advisory Blog notes, the proxy voting policy for the United States reflects the following updates:
1. Enhanced Pay-for-Performance Evaluation
Glass Lewis has updated its pay-for-performance model to adopt a scorecard-based approach. Instead of assigning a single letter grade (A–F), the model now consists of up to six tests, each receiving an individual rating. These ratings are aggregated on a weighted basis to produce an overall score ranging from 0 to 100. This change is intended to provide a more nuanced and transparent assessment of executive compensation alignment with company performance.
2. General Approach to Shareholder Proposals
Glass Lewis has updated its language regarding shareholder proposals in light of ongoing and anticipated changes to the U.S. shareholder proposal process. While prior guidance on companies’ treatment of the SEC’s former no-action process has been removed, Glass Lewis maintains that shareholders should have the opportunity to vote on matters of material importance. The policy acknowledges that some proposals may unduly burden companies or cross into board responsibilities, and not all proposals serve long-term shareholder interests. Nonetheless, Glass Lewis views the fundamental right of shareholders to submit proposals as critical to effective corporate governance and the economic interests of all shareholders. Glass Lewis notes that its approach may be further revised prior to or during the 2026 proxy season if regulatory developments warrant additional updates.
3. Shareholder Rights
Glass Lewis has updated its guidance on situations where boards amend governing documents to reduce or remove key shareholder rights. Such actions may lead to recommendations against the chair of the governance committee—or, in certain cases, the entire committee. Examples include amendments that:
– Limit shareholders’ ability to submit proposals;
– Restrict shareholders from filing derivative lawsuits; and
– Replace majority voting with plurality voting.
4. Mandatory Arbitration Provisions
Glass Lewis has introduced guidance on mandatory arbitration provisions within its Benchmark Policy. When reviewing companies’ governing documents after an IPO, spin-off, or direct listing, Glass Lewis will assess whether such provisions or other potentially negative governance provisions present. If such provisions are included, it may result in a recommendation to vote against the chair of the governance committee or, in certain cases, the entire committee. Additionally, Glass Lewis will generally recommend opposing any bylaw or charter amendment that seeks to adopt mandatory arbitration unless the company provides clear and sufficient rationale and disclosure.
5. Amendments to Governing Documents
Glass Lewis has consolidated its approach to amendments to the certificate of incorporation and bylaws into a single section. Proposed amendments will be evaluated on a case-by-case basis, with strong opposition to “bundled” proposals that combine multiple changes under one vote. In general, Glass Lewis will recommend supporting amendments that do not materially harm shareholder interests.
6. Supermajority Vote Requirements
Glass Lewis has clarified its stance on supermajority voting provisions. Proposals to eliminate these requirements will be assessed individually. While Glass Lewis generally supports removing supermajority thresholds, it recognizes that such provisions may protect minority shareholders when a company has a large or controlling shareholder. In these cases, Glass Lewis may oppose their elimination.
As I noted in the blog back in October, Glass Lewis announced that it “will move away from singularly-focused research and vote recommendations based on its house policy and shift to providing multiple perspectives that reflect the varied viewpoints of clients.” For now, we still have the proxy advisory firm’s benchmark proxy voting policies to consider as we enter the proxy season.
On Friday, the SEC announced that it had consented to the termination of undertakings in the early-2000s Global Research Analyst Settlement. The modifications are subject to court approval. The SEC’s announcement notes:
The final judgments contained an Addendum with undertakings that addressed potential conflicts of interest between equity research analysts and investment banking personnel. The Addendum also included a sunset provision for newly adopted rules that would supersede the undertakings, and stated that for terms that were not superseded, the SEC would agree to an amendment or modification, subject to court approval, unless the SEC believed the amendment or modification would not be in the public interest. The Addendum was modified by court order in March 2010 to remove or modify certain provisions. The revised Addendum also stated that the SEC would agree to further amendment or modification of the undertakings, subject to court approval, unless the SEC believed the amendment or modification would not be in the public interest.
In 2015, FINRA adopted and implemented, and the SEC approved, Rule 2241 (Research Analysts and Research Reports), which addresses conflicts of interest between research analysts and investment banking personnel within registered broker-dealers.
The settling firms filed motions in June and December 2025 seeking to terminate the remaining undertakings in the Addendum based in part on the adoption and implementation of FINRA Rule 2241. In its responses to the motions, the SEC acknowledges the sunset provision in Addendum A of the final judgments and the passage of FINRA Rule 2241, states that it “believes modification of the Judgment is in the public interest,” and consents to the requested modification of the final judgments.
It’s not a coincidence that since 2004, there has been a lot less research out of Wall Street, particularly for small and medium-sized companies. The result has been a chilling effect on research coverage in precisely the segments—emerging growth and smaller public companies—where investors most need high quality analysis. In 2017, the U.S. Department of the Treasury recommended that the SEC conduct a holistic review of the Global Research Settlement and the research analyst rules to determine which provisions should be retained, amended, or removed, with the objective of harmonizing a single set of rules for all financial institutions.
Today, the Commission moved toward more thoughtfully regulating some of the most important providers of sell-side equity research. It seems hard to argue that the requirements of the Global Research Settlement still hold their relevance. FINRA Rule 2241 now provides a robust framework for managing research analyst conflicts, disclosures, and supervision, but does so through a principles-based SRO rule that can be updated through notice-and-comment and interpreted consistently across member firms. These are not weaker protections; rather, they are conflict mitigation tools that are targeted, transparent, and aligned with how research is actually produced, paid for, and consumed. The Commission’s action will lower compliance friction, promote more consistent interpretations, and, ultimately, expand the availability of research coverage that helps investors make better decisions.
In short, this is the kind of good government reform that will better serve investors, issuers, and the integrity of our U.S. capital markets.
If you are an old-timer like me, you will recall that the Global Research Analyst Settlement was a momentous event that addressed research analyst conflicts of interest and other concerns that emerged from the late 1990s dot.com boom (and bust), radically changing the way that research is done on Wall Street.
Join us tomorrow for the joint Practical ESG.com/TheCorporateCounsel.net webcast – “Disclosing Sustainability Financial Value in 10-Ks” – to hear the perspectives of the following panel on the topic of reporting sustainability matters in periodic reports:
– Dan Goelzer, Retired Partner, BakerMcKenzie and former Board Member of the Public Company Accounting Oversight Board
– Rich Goode, Principal, ESG Services, PwC
– Kristina Wyatt, CSO, Persefoni, former SEC Counsel
– Maia Gez, Head of Public Company Advisory Group, White & Case LLP
– Daniel Aronson, Founder & CEO, Valutus
Topics to be discussed on the webcast include:
1. Setting the Baseline: U.S. SEC Reporting Basics, Including “Materiality” and Managerial v. Financial Accounting
2. What Companies Are Doing Now – Informal Reporting, Results from PESG Compendium
3. Where Sustainability Generates Meaningful Business Value – Double v Financial Materiality, Managerial Accounting v Financial Accounting
4. Why Companies Should Report Sustainability Value in 10-K/Q – Formalize Reporting to a Single, Credible Standard (Financial Accounting v. Non-Financial Framework), Eliminate Question of Materiality (Financial v. Operational Metrics), Control the Narrative, Meet Investor Needs, Take Conversation Away from Anti-ESG, Defend Budget and Jobs
5. Barriers: Accounting Topics, Lack of Data (Attribution of Material Financial Matters To Sustainability Initiatives), Inadequate Controls on Sustainability Data/Reporting, Fear of risk, Corporate Inertia
6. Fighting No: How to Make Your Case for Reporting Sustainability Value in 10-K/Q
Note that this webcast is being provided free of charge. CLE credit is not available.
As Commissioner Crenshaw reminded us during yesterday’s Investor Advisory Committee meeting, as we settle back into a work routine after the holidays, she won’t be doing the same, at least not as an SEC Commissioner. The 18-month extension of her term expires on January 3.
Commissioner Crenshaw has been the only Democrat on the Commission since former Chair Gensler and Commissioner Lizárraga resigned in January 2025. The SEC will be working with a 3-0 composition, and as DealBook reports, we don’t know if or when someone will be named to replace her or to fill the fifth, currently vacant seat.
A bipartisan composition may not really impede the SEC’s ability to advance its rulemaking agenda, but DealBook says Commissioners can “force topics into open meetings, help shape internal discussions and issue public dissents,” and those public dissents apparently do more than make our blogs more interesting. The NYT noted in March that dissenting policy statements “are sometimes cited by private litigants in the courts” and “can make their way into court decisions.”
Speaking of the SEC’s agenda, this is a great time to remind you about next week’s webcast “The (Former) Corp Fin Staff Forum.” Tune in at 2 pm ET on Thursday, December 11, to hear from former Senior Corp Fin Staffers. Sidley’s Sonia Barros, WilmerHale’s Meredith Cross, Gibson Dunn’s Tom Kim, Edward Jones’ Keir Gumbs, and our colleague Goodwin’s Dave Lynn will update you on the SEC’s rulemaking agenda, Staff interpretations and disclosure review from the Corp Fin perspective.
In remarks on Wednesday at the 2025 Institute for Corporate Counsel, Commissioner Uyeda addressed such hot topics as a potential shift away from quarterly reporting, shareholder proposals and mandatory arbitration, so it might seem strange that I’m focusing this blog on his commentary on robo-voting (when institutional investors purportedly automatically follow proxy advisor voting recommendations without independent review). But whether you think robo-voting remains prevalent and a major problem, or you think the concern has been overblown, Commissioner Uyeda’s commentary — suggesting that, “depending on the facts and circumstances, funds and asset managers using [proxy voting advisory businesses (PVAB)] for voting decisions may have formed a group for purposes of Section 13(d)(3) or Section 13(g)(3) of the Securities Exchange Act” — will probably interest you. Here’s an excerpt:
Indeed, the Commission itself raised this issue in 2020 when it stated that “[u]se of a proxy voting advice business by investors as a vehicle for the purpose of coordinating their voting decisions regarding an issuers’ securities” would raise issues under the SEC’s beneficial ownership rules. Of course, a group is not formed simply because a shareholder independently determined how it wants to vote on an issue, announced its voting decision, or advised others on how it intended to vote.
The key is that the vote is based on an independent decision by the shareholder itself. If, in lieu of such independent decision-making, funds and asset managers automatically vote shares solely based on PVAB recommendation regarding shareholder proposals that have the purpose or effect of influencing control over the company and the aggregated voting power of such persons exceeds 5% beneficial ownership, such persons may have formed a group and need to file a Schedule 13D even if they beneficially own less than 5% on an individual basis.
To the extent that funds and asset managers are engaging in “robo-voting” based on PVAB recommendations, such practices should be reviewed to determine whether they comply with the Exchange Act and SEC rules. The evaluation of whether a group has been formed should take into account the business realities of the arrangements, particularly if robo-voting results in coordination of voting practices where owners of the same securities vote in tandem with each other with the effect of influencing control of an issuer. The substance of such arrangements has implications under Section 13(d) of the Exchange Act and we should not shy away from scrutinizing such consequences.
It seems (to me at least) that robo-voting has gone down in recent years, but it also seems hard to discern causation (meaning, where an investor truly automatically votes in line with a benchmark recommendation) from correlation (where there’s a high degree of alignment of votes with benchmark recommendations despite the shareholder making independent decisions). For example, we’ve blogged about how, for a substantial portion of fund families, 99% of their votes align with a proxy advisor’s benchmark recommendation. But we’ve also shared that large institutional investors largely don’t automatically vote in accordance with proxy advisor benchmark policy recommendations. This is a suggestion by Commissioner Uyeda that the SEC scrutinize these practices, so we’ll have to wait to see where this goes.
As Liz shared last week, the agenda for yesterday’s Investor Advisory Committee meeting covered a lot of ground – including regulatory changes in corporate governance, tokenization of equity securities and disclosure of AI’s impact on operations. With respect to AI disclosures, the IAC considered a discussion draft prepared in advance by the IAC’s Disclosure Committee with recommendations to the Commission to issue further AI-related disclosure guidance applicable to issuers.
Here’s an excerpt from that discussion draft:
Specifically, the Committee recommends that the Commission integrate AI disclosure guidance as part of existing disclosure items. Reg S-K items 101, 103, 106, and 303 are flexible enough to accommodate the rise in the use of AI by registrants and it may not be necessary to add a sub-chapter focused solely on AI. Issuers already provide disclosures to the markets concerning capital expenditures, R&D, Risks, Human Capital Management, Governance under existing Reg. S-K items . . .
To that end, the Committee recommends that, with respect to its AI disclosure, the Commission require issuers to:
– Define what they mean when they use the term “Artificial Intelligence”,
– Disclose board oversight mechanisms, if any, for overseeing the deployment of AI at the company, and
– Report separately on how they are deploying AI and, if material, the effects of AI deployment on (a) internal business operations, and (b) consumer facing matters.
The recommendations were informed by a March 2025 IAC panel discussion, and this topic had been on the IAC’s agenda for some time before that — beginning during the Biden Administration. IAC member John Gulliver expressed concern that the recommendations would increase disclosure requirements at a time when the Commission now looks to streamline them. For that reason, these recommendations may not get much traction in the near term. Remarks by Chairman Atkins suggest he believes existing disclosure requirements already sufficiently address AI.
[W]ith every emerging development, the question for the SEC to consider is not necessarily its novelty, but whether our existing disclosure framework sufficiently provides investors with material information about it. And on that point, I believe that investors can rely on our current principles-based rules to inform them of how AI impacts companies.
Indeed, we should resist the temptation to adopt prescriptive disclosure requirements for every “new thing” that affects a business. Our principles-based rules were intentionally designed to allow companies to inform investors of material impacts of any new development, including how AI affects their financial results, how AI can be a material risk factor to an investment, and how AI is a material aspect of their business model.
Tuesday’s webcast – “This Year’s Rule 14a-8 Process: Corp Fin Staff Explains What You Need to Know” – featuring Corp Fin Chief Counsel, Michael Seaman, Corp Fin Counsel, Emma O’Hara, Cooley’s Reid Hooper and Gibson Dunn’s Ron Mueller and moderated by our colleague Liz Dunshee addressed a ton of procedural questions on the new 14a-8 process for the 2026 proxy season. The webcast replay is already posted and available for free — even for folks who aren’t members of TheCorporateCounsel.net.
In the meantime, here are just a few of the open questions addressed during the program (subject to the SEC’s standard disclaimer):
– The Staff doesn’t need the Rule 14a-8(j) notices to be particularly long, whether or not they seek a response. The notices only need to include information required by the rule (the proposal, an explanation of why the company believes that it may exclude the proposal, which should, if possible, refer to applicable authority, like prior Division letters, and an opinion of counsel, if applicable) plus the reasonable basis representation, if you want a response.
That said, the Staff recognizes that these notices might also be written for other audiences (e.g., the proponent, proxy advisors, other shareholders and other stakeholders) and include much more detail than the Staff needs for their purposes, although the Staff won’t be doing a in depth analysis of this material since that wouldn’t accomplish the intended purpose of reducing the burden on the Staff’s time.
– If the company wants a response and includes a reasonable basis representation, there is no magic language required, and it has already taken a few forms based on what has been submitted to date (see a few examples already posted). While the announcement refers to an “unqualified” representation, you don’t need to include the word unqualified. “Unqualified” was included in the announcement to avoid the representation being subject to assumptions. The company’s inclusion of language like “we represent we have a reasonable basis” will trigger the Staff’s process to issue a response.
– With the Staff continuing to respond to Rule 14a-8(i)(1) no-action requests, they were asked about no-action requests that raise multiple bases for exclusion — for example, (i)(1) and (i)(7). To this, the Staff noted that they hope companies don’t combine other basis for exclusion with their (i)(1) requests.
Finally, keep in mind that the sec.gov shareholder proposals site remains in flux — especially as it relates to no-action letters that were submitted prior to the announcement. Keep checking back since it will make more sense as it is further updated. For example, as companies that submitted a no-action request before the announcement submit their 14a-8(j) notices, those files will be moved to their appropriate bucket depending on whether they include the reasonable basis representation (in which case they’ll be included under Responses to Rule 14a-8(j) Notifications) or not (in which case they’ll be included under Rule 14a-8(j) Notifications With No Division Response Forthcoming). (They are currently in the “no response” bucket.)
They discussed so much more — like what to do with correspondence with the proponent, what to do if a proposal is received after the 14a-8(j) deadline and how companies will consider whether to exclude a proposal, especially where there are limited Staff concurrences. Listen to the full replay for more.
Following up on its recent review of insider trading policies adopted by the SV150, Wilson Sonsini recently published a report on its survey of Rule 10b5-1 trading plan guidelines at SV150 companies. They looked at cooling-off periods, minimum and maximum terms, trading outside of the trading plan, early termination restrictions, and mandatory use of plans. This blog shares some highlights:
– A majority (53 percent) of guidelines adhere to the Rule 10b5-1 minimum cooling-off periods, but some apply longer cooling-off periods to additional personnel or impose longer durations than the minimum required in the rule.
– A significant minority (44 percent) of guidelines impose a minimum term, a maximum term, or both, with minimum terms ranging from three months to one year, and maximum terms ranging from one to three years.
– Nearly one-third (32 percent) of guidelines prohibit trading in company securities during the term of a trading plan outside of the trading plan, with some providing for limited exceptions such as dispositions of gifts.
– Many of the guidelines impose restrictions on early termination of trading plans including, for example, requiring notice or prior approval, only allowing early termination during an open trading window, or only allowing early termination when the insider is not aware of material nonpublic information.
– Only a small percentage of companies (11 percent) require company insiders to transact in company securities through trading plans, generally limited to directors, Section 16 officers, and, in some cases, other management or designated personnel.
Here’s more info on some alternative approaches to cooling-off periods:
– 28% apply the D&O cooling-off period to everyone.
– 16% of companies had approaches to cooling-off periods categorized as “other.” Of those, nine guidelines provide for the director and officer cooling-off period for directors and Section 16 officers but provide for something other than the minimum 30-day cooling-off period for all others.
– Variations include: The later of 30 days or the opening of the next trading window; the later of 60 days or the opening of the next trading window; and 90 days. Two sets of guidelines provide for the Rule 10b5-1 default cooling-off periods but include additional persons (management or other designated employees) in the director and officer cooling-off period, and one set of guidelines provides for a 120-day cooling-off period for everyone.
California climate bills SB 253 and SB 261 were sailing along towards implementation. Despite litigation challenging the laws, the lower courts initially refused to issue injunctions against them. Plaintiffs were appealing to the Supreme Court for an emergency injunction that seemed like a long shot. Then, somewhat unexpectedly, the Ninth Circuit Court of Appeals enjoined SB 261, staying the law pending the outcome of litigation. However, confusion remained as to whether this injunction applied to all in-scope companies, or only those parties to the lawsuit. The California Air Resources Board (CARB) clarified this week that it would not enforce SB 261 against any companies at this time. A recent Gibson Dunn memo discusses CARB’s statement:
On December 1, 2025, the California Air Resources Board (‘CARB’), the state agency responsible for enforcing SB 261, responded to the injunction by posting an enforcement advisory stating it would not enforce the law ‘against covered entities for failing to post and submit reports by the January 1, 2026, statutory deadline.’ Instead, CARB ‘will provide further information—including an alternate date for reporting, as appropriate—after the appeal is resolved.’
SB 261 is now in limbo, meaning companies will not be required to report on climate-related financial risk. Its counterpart, SB 253, has not been enjoined and is still set to come into force. SB 253 requires disclosures of emissions data, and the first reports are due on August 10, 2026. It’s unclear if and when SB 261 will be enforceable, but if the law survives its court challenges, then we’ll likely hear more from CARB regarding compliance timelines.
PracticalESG.com members can learn more about SB 261 and SB 253 here. If you’re interested in a full membership to PracticalESG.com with access to the complete range of benefits and resources, sign up now and take advantage of our no-risk “100-Day Promise” – during the first 100 days as an activated member, you may cancel for any reason and receive a full refund. If you are not a member, but you follow PracticalESG.com blogs, beginning January 15, 2026, those blogs will no longer be available without a PracticalESG.com membership. But there’s a new membership level just for the blogs – and sign up is live with a limited time incentive. If you obtain a blog-only membership before January 15, 2026, you can take advantage of a 50% discount off the regular first-year membership ($249.50 for a 2026 membership versus $499 regular price).
