Whenever I watch international sporting events, I’m always struck by just how many of the world’s countries have national anthems that you don’t have to be Whitney Houston to sing properly. Ireland is one of those countries – and I’d place its unofficial anthem, “Ireland’s Call,” among the very best. So, in honor of St. Patrick’s Day, here’s the Irish rugby team and thousands of proud Irish men & women belting it out:
I have several professional Irishmen in my family (my last name’s Jenkins, but my other 3 grandparents last names are Kennedy, Keefe and Gallagher), and I know I’d hear from them if I didn’t point out that Ireland’s Call isn’t the Republic of Ireland’s official anthem, and that it’s used at rugby matches for reasons that reflect the Emerald Isle’s sad & divided history.
Still, it’s a terrific song and one that both North & South are increasingly proud to sing together. I think that’s something we can all lift a glass to on this St. Patrick’s Day.
Happy St. Patrick’s Day to all of you actual or honorary sons & daughters of Erin!
The SEC’s decision to withdraw from its role as Rule 14a-8 referee has generated bipartisan howls from leading participants in the shareholder proposal industry about “silencing shareholder voices.” However, early returns suggest that companies are taking a cautious approach about telling their shareholders to “shut up.” Check out this excerpt from a recent Bryan Cave blog discussing ISS’s Proxy Season Preview (which Liz recently blogged about over on our “Proxy Season Blog”):
As discussed in our November 19, 2025 post, in most cases, companies can now decide themselves whether to exclude shareholder proposals – subject only to documenting a reasonable basis for exclusion.
However, according to ISS, a smaller percentage of companies (22%) are omitting proposals so far this year compared to 2025 (28%). This suggests that companies “may be reassessing the strategic value of omissions and the risks associated with it.”
For example, as noted in our post, companies may face litigation risks from proponents. Last month, three lawsuits were filed, with two of the companies quickly settling and agreeing to include the proposals. In one case, the complaint alleged inadequate disclosure in the company’s notice filing with the SEC.
Glass Lewis noticed the same thing in its review of how companies are handling shareholder proposals so far:
While the SEC’s change can be interpreted as giving boards free rein to set their meeting agendas, some companies appear to be taking a more cautious approach. A number of companies that filed exclusion notices prior to the November 17 announcement (Analog Devices, Apple, Costco, Starbucks and Tyson Foods) did not receive any response from the SEC, did not withdraw or refile their notices, and ultimately allowed these shareholder proposals go to a vote.
Like ISS, Glass Lewis also highlights the changing risk environment that companies face in the absence of the no-action process as likely contributing to this cautious approach. Participants in the shareholder proposal industry have proven willing to litigate, and institutional investors and proxy advisors have indicated that there will be consequences to boards that exclude proposals without solid justification.
Disclosure of executive security arrangements is a topic that’s received a lot of attention over the past year, including from SEC Chairman Paul Atkins, who suggested that the SEC’s continued treatment of executive security arrangements as a perk doesn’t reflect modern business realities. While Chairman Atkins’ comments may give companies reason to hope that perk disclosure of these arrangements may soon end, for this year at least, the old rules continue to apply.
So, with all the attention being paid to executive security, what should companies disclose about these arrangements in their proxy statements? Over on Real Transparent Disclosure, Broc recently provided some answers to that question. Here’s an excerpt:
– Rapid Growth in Executive Security Spending: Personal security services (home security, cybersecurity, security personnel, travel security) are increasing in prevalence and cost. Disclosure rates show 64% of the S&P 100, 35% of the S&P 500 – and 10% of the Russell 3000 provide executive security services, with expectations of continued growth.
– ISS’s Evolving Position on Security Perks: While ISS historically cited security expenses critically in negative Say-on-Pay recommendations, it recently relaxed its stance. ISS now indicates it is unlikely to raise significant concerns if companies provide robust proxy disclosure explaining the rationale and assessment process behind security programs.
– Disclosure Expectations from Proxy Advisors: Adequate disclosure should describe:
-The nature of the security program
– The benefit to stockholders
– The internal or third-party security assessment
– The arm’s-length decision-making process
Broc also says that companies expecting a significant increase in executive security expenditures need to involve the compensation committee and the relevant executives early on in order to ensure a robust assessment and approval process. These companies should also provide clear disclosure of that process in the CD&A in order to mitigate any criticism they might receive from proxy advisors.
Check out our latest “Timely Takes” Podcast featuring Cleary’s J.T. Ho & his monthly update on securities & governance developments. In this installment, J.T. reviews:
– New CDIs – Notices of Exempt Solicitations
– New CDIs – Broker Search Timing
– New CDIs – Spinoff Exec Comp Disclosure
– Rule 14a-8 Litigation
– Updates on Fallout from DEI Executive Order
As always, if you have insights on a securities law, capital markets or corporate governance issue, trend or development that you’d like to share in a podcast, we’d love to hear from you. You can email me and/or Meredith at john@thecorporatecounsel.net or mervine@ccrcorp.com.
While securities fraud claims based on alleged “hypothetical risk factors” aren’t likely to be a high priority for the SEC in the current environment, they continue to get some traction in private securities litigation. The 9th Circuit’s decision earlier this month in Const. Laborers Pension Trust v. Funko, (9th Cir.; 2/26) provides further evidence of that – and highlights the potential for these claims to preclude companies from relying on the PSLRA’s safe harbor for forward-looking statements. Here’s an excerpt from The 10b-5 Daily’s blog about the case:
In [Funko], the plaintiffs alleged that Funko’s “risk disclosures” about its ability to manage its inventory in the future “concealed the facts that Funko had already failed to manage its inventory and that its business, financial condition, and operations were already adversely affected.” The district court found that these risk disclosures were protected by the PSLRA’s safe harbor because the plaintiffs failed to adequately plead actual knowledge of their falsity. On appeal, however, the Ninth Circuit panel appears to have created a new exception to the safe harbor.
In particular, the panel concluded that because the alleged omission related to Funko’s current failure to manage its inventory, the risk disclosure “implicitly serves as a comment on the present state of affairs, because it suggests that the circumstance posing the risk has not yet occurred.” And, as a result, the risk disclosure “does not fall under the safe harbor for forward-looking statements because its falsity lies not in the failure to predict the future, but in the implicit assertion about the present that the risk identified has not happened yet.” In other words, if a plaintiff alleges an “affirmative misrepresentation theory” then the otherwise forward-looking risk disclosure is converted into a statement of present fact and is not subject to the safe harbor.
The blog notes that the 9th Cir.’s position here is unusual, and that taken to its logical conclusion could essentially gut the PSLRA’s safe harbor, because “virtually every forward-looking statement securities fraud claim is based on the alleged omission of some ‘undisclosed fact tending to seriously undermine the accuracy of the statement.’”
It’s worth pointing out that federal courts have long had a somewhat tortured relationship with the PSLRA safe harbor for forward-looking statements. If you’re interested in learning more about how judges have sometimes twisted themselves into a knot to avoid applying the safe harbor, check out this article that I wrote for The Corporate Counsel newsletter a few years ago.
Over on The Business Law Prof Blog, Ben Edwards provides some interesting statistics on the jurisdiction of incorporations for companies that went public in 2025. Those statistics come from a slide deck prepared by Houlihan Lokey’s Robert Rosenberg for a PLI M&A conference in which both gentlemen participated. Houlihan Lokey’s data indicates that while Delaware was the jurisdiction of incorporation for over 80% of IPOs conducted in 2022-2024, its share fell to just under 62% in 2025. Nevada was the jurisdiction of incorporation for nearly 17% of IPO issuers in 2025, while Texas came in at just under 4%.
Does this mean it’s time for Delaware to panic? Ben doesn’t think so:
Although I can’t speak for the other panelists here, I think we all expect that Delaware will remain king of the hill by a substantial margin. There have been some shifts and some companies moving, but Delaware will continue to grow both in terms of overall numbers from private entity formation, public company IPOs, and public companies deciding to move to Delaware from other jurisdictions.
Delaware’s overall numbers depend on both DExits and DEntries. Companies sometimes shift their incorporation from one jurisdiction to another. As long as more are moving in than moving out, Delaware will continue to grow. Delaware has a dominant product. That isn’t likely to change anytime soon. But that doesn’t mean that there isn’t any room for other states to offer alternatives.
Traditionally, most companies confronted with an SEC enforcement action have opted to negotiate a settlement with the agency. However, this Dentons blog says that with the change in the SEC’s approach to corporate penalties and uncertainties regarding the continued viability of disgorgement in cases not involving investor harm, companies should give some thought to potentially litigating with the SEC:
Corporate penalties took a nose-dive following the change in administration, and this downward trend is generally expected to continue in 2026, with the possibility of a change in penalty policy. And expect the SEC to consider giving more credit for cooperation and remediation than before. There is also more uncertainty about the SEC’s use of the disgorgement remedy until the US Supreme Court decides later this year whether the SEC must show “pecuniary harm” to investors to obtain disgorgement.
Given this uncertainty, litigating instead of just settling should be carefully considered as an option in the defense toolkit. Litigation, or even the credible threat of litigation, can often yield better results, especially when regulators are seeking unreasonable monetary and non-monetary sanctions.
The blog also speculates on likely corporate enforcement targets, and says that companies with foreign ties, those with prior regulatory issues, and companies that are promoting new products (whether AI-related or not) may find themselves on the SEC’s radar.
Executive search firm CristKolder recently published its 2025 C-Suite Volatility Report, which focuses on C-Suite changes & demographics among Fortune 500 and S&P 500 companies. Here are some of the highlights:
– 78 CEO positions in this cohort of companies turned over last year, with the consumer sector leading the way at 24.4%, while the energy sector experienced the most stability with a turnover rate of just 9.0%.
– 120 CFO positions turned over, with nearly 20% of companies experiencing a change in CFOs last year. The services sector led the way with a 20.8% turnover rate, while the financial sector experienced only 7.5% CFO turnover.
– Only 16.5% of new CEOs and 12% of new CFOs were recruited externally last year. That’s much lower than the historical averages of 23% and 39%, respectively.
– The percentage of female CEOs and CFOs continues to trend upward, with female CEOs increasing to 9.1% and CFOs to 16.5%. The number of companies with female CEOs has nearly doubled in the past decade.
– CEOs and CFOs are also becoming more ethnically and racially diverse, with 14.6% of CEOs and 14.9% of CFOs being from diverse backgrounds.
The report is full of other interesting demographic tidbits, including the fact that more CEOs and CFOs come from public universities than private ones. That gives me an excuse to point out that two institutions to which I’ve paid considerable amounts in tuition topped the CEO leader board among public universities. The University of Virginia (where I went to law school) & Miami University (OH) (our youngest son’s alma mater) both accounted for 9 CEOs. They shared the top spot with Meredith’s alma mater, The University of Michigan.
Speaking of C-Suite turnover, a recent Weil memo addressing key corporate governance, engagement, disclosure and annual meeting topics highlights the importance of the board’s role in CEO succession planning:
With CEO turnover reaching record levels, boards face heightened pressure to reinforce succession planning processes and build deeper leadership pipelines. A November 2025 report by The Conference Board, Egon Zehnder, ESGAUGE and Semler Brossy notes that CEO succession announcements by S&P 500 companies over the last year increased to 13% as of October 2025 (up from 10% in 2024). This trend reflects broader market volatility, activist pressure, and shifting investor expectations around leadership stability.
In this environment, effective succession planning requires boards to evaluate a wider slate of candidates, prepare for both long-term and emergency transitions, and identify the mix of skills and strategic priorities that will reassure investors that strong leadership is both in place and actively being developed. Robust planning not only supports continuity but also mitigates the risk of disruption to strategy, operations, and overall performance.
Other areas addressed in the memo include risk oversight, board composition, human capital and executive and board compensation, and the shifting shareholder engagement landscape.
In order to fund their roughly eleventy squijillion dollars in projected AI-related capex over the next several years, prominent hyperscalers like Alphabet, Amazon, Alphabet, Meta, Microsoft, and Oracle have turned to the debt markets in a big way. According to this recent Reuters article, those companies have raised over $120 billion in corporate bonds last year. Not surprisingly, investor demand for these securities is very high, but Reuters points out that even by investment grade issuer standards, the covenants in some of these recent deals have been remarkably light:
Investment-grade borrowers with strong credit profiles typically include fewer covenants in debt agreements than their junk-rated counterparts. Yet most include basic investor guardrails, especially a standard change-in-control covenant protecting investors in the event of M&A or another change in ownership. Alphabet’s bonds do not carry these protections, noted Anthony Canales, head of global research at New York-based Covenant Review.
The five major AI hyperscalers – Amazon, Alphabet, Meta, Microsoft, and Oracle – issued $121 billion in U.S. corporate bonds last year, according to a January report by BofA Securities.
Alphabet and Amazon did not respond to requests for comment, while Oracle, Meta and Microsoft declined to comment.
Oracle’s $25 billion note offering on February 2, and Meta’s $30 billion bond offering in October, similarly lacked change-in-control and other basic covenants, Canales noted.
The article cautions that smaller players may be in for a rude awakening if they think they’ll get similar terms for their own offerings. As with everything else that’s AI-related, size matters in the debt markets too.
