SEC Proposes Rules to Eliminate Rule 14a-8 and Modernize the Proxy Solicitation Process

As anticipated, on September 16, 2026, the Securities and Exchange Commission (SEC) issued two proposed rules: the first addressing the existing shareholder proposal rules (the Rule 14a-8 Proposal), and the second proposing to modernize the proxy solicitation process (the Proxy Solicitation Process Proposal).  As we previously reported, this follows the 2026 trend of decreasing compliance obligations and modernizing existing rules for capital raising.

Comments are due within 60 days following publication of the proposal release in the Federal Register.

Here’s what you need to know:

The Rule 14a-8 Proposal 

Currently, there are two ways that shareholders can submit a proposal to be voted on by shareholders (other than director nominations):

• Submit a proposal under Rule 14a-8 which means the proposal will be included in a company’s proxy statement; and
• Submit a proposal under existing mechanics set forth in state corporate law and the company’s bylaws

Existing Rule 14a-8 requires public companies to incorporate shareholder proposals in proxy materials if such shareholders meet minimum ownership, holding period and other procedural prerequisites and the proposal satisfies certain relevance requirements. The reasoning being the Rule 14a-8 Proposal centers on the SEC’s view that the Exchange Act’s Section 14(a) authorizes the SEC to regulate the proxy solicitation process but does not grant it the authority to supersede the process in selecting which proposal may be properly voted on by shareholders – a matter conventionally reserved to state corporate law.  Further, the SEC has lately tired of serving as an arbitrator under Rule 14a-8 no-action requests for exclusion of proposals.  In fact, during the 2025-2026 proxy season, the SEC ceased providing guidance on the subject.

As a corollary, the SEC also proposed an amendment to Rule 14a-4(c) that would expand a public company’s discretionary voting authority on shareholder proposals that are not submitted pursuant to Rule 14a-8.

The Proxy Solicitation Process Proposal

The Proxy Solicitation Process Proposal would make several changes to the proxy solicitation process:

• Eliminate delivery of “glossy” annual reports. The proposal would eliminate the requirement that companies send an annual “glossy” annual report to shareholders in connection with the annual proxy statement electing directors. It would also eliminate the stock performance graph for companies other than investment companies.  Companies could still send voluntary annual reports to shareholders.
• Eliminate Delivery Deadlines when documents are incorporated by reference into the proxy statement. The proposal would eliminate the requirement that proxy statements incorporating other documents and filings by reference be sent at least 20 days before the meeting.
• Eliminate Notice of Exempt Solicitation. The proposal would eliminate Rule 14a-6(g)Rule 14(a)-6(g)- a rule that required shareholders with more than $5 million of a public company’s stock who communicated with other shareholders in an exempt solicitation to file a Notice of Exempt Solicitation as well as reducing the broker search from 20 to 5 business days before the record date.
• Contact Information. The proposal would also require proxy statements and information statements to include company contact information, much like existing registration statements.

Takeaways

We anticipate significant pushback on the Rule 14a-8 proposal by constituents who now take advantage of the low-cost, high publicity that the Rule currently provides for them.  This could include litigation which would further delay implementation of any final rules.  In the meantime, here are some other takeaways:

First, if Rule 14a-8 is rescinded, it is likely that it would not become effective until after the 2027 proxy season.  Therefore, public companies should approach next year’s proxy season under their existing Rule 14a-8 framework.

Second, rescission of Rule 14a-8 does not meet the end of shareholder activism.  Shareholders will continue to voice their opinions through directors’ elections, floor proposals and say-on-pay votes.

Third, dust off and review your governing documents and applicable state law to understand the mechanics for floor proposals and framework for floor submissions by shareholders.

We will keep track of any developments and keep you posted.