With the 2026 proxy season upon us, companies are finalizing annual meeting materials against a backdrop of shifting investor priorities, evolving engagement dynamics, and regulatory uncertainty. This alert highlights governance, disclosure, and engagement considerations for companies preparing for their 2026 annual meetings. [1] Below are five key considerations as you finalize preparations.

1. No new mandatory proxy statement disclosure rules—yet the 2026 proxy season is happening in a time of change. What does that mean for my company’s disclosure?

Unlike some years, there are no new mandatory disclosure rules for this year’s proxy statement. But last season’s developments, together with continued signals from the U.S. Securities and Exchange Commission (SEC) about possible future rulemaking, make 2026 an important year to reassess—and not simply refresh—disclosures. Companies should review existing proxy statement disclosure to ensure it complies with existing rules and regulations, and is tailored for the company’s current circumstances, responsive to previous shareholder voting outcomes and engagement feedback, aligned across the company’s public communications (Form 10-K, website, sustainability materials, among others), and relevant to investors. In addition, companies should consider whether changes to proxy statement disclosures may be appropriate in light of emerging trends and the shifting regulatory landscape.

• Executive compensation. Last year, the SEC held a roundtable on executive compensation and solicited public input. While the SEC has not yet issued a rule proposal, executive compensation disclosure will remain a focal point and future rulemaking is expected. In the meantime, companies should ensure they are complying with existing executive compensation rules and—just as importantly—that their Compensation Discussion and Analysis clearly reflects their compensation objectives and decisions and provides tailored information most relevant to their investors.
• Diversity disclosure. Shortly before last proxy season, Nasdaq’s board diversity disclosure rules were invalidated by a court, and executive orders were issued targeting diversity, equity, and inclusion (DEI) initiatives. [2] As a result, in preparing their 2025 proxy statements, many companies reconsidered how to address DEI disclosure, and in 2026, companies continue to evaluate DEI initiatives and disclosure. Regardless of the overall approach taken with disclosure of these matters, existing rules still require companies to disclose if they have a policy regarding the consideration of diversity in identifying director nominees. [3] In addition, companies should still consider relevant investor policies and engagement feedback regarding diversity and inclusion matters and ensure any proxy disclosures are consistent with their Form 10-K disclosures, sustainability reports, and company websites.
• Environmental, social, and governance (ESG) disclosure. The climate for ESG disclosures has changed. Last year, the SEC announced it would no longer defend the climate disclosure rules, adopted in 2024, against a lawsuit seeking to invalidate the rules. The U.S. Court of Appeals for the Eighth Circuit subsequently paused the litigation indefinitely, pending further action by the SEC to reconsider the rules or renew its defense of them. Several states have or soon will implement climate disclosure rules. The California climate risk disclosure rules (SB 261) are on hold pending litigation, while greenhouse gas emissions rules (SB 253) are still in scope with initial deadlines approaching in August 2026. In New York, climate disclosure rules similar to those approved in California were approved by the Senate and are being considered in the Assembly. In Europe, climate disclosure rules are being scaled back and implementation dates postponed. In light of these changes, many companies are assessing their climate disclosure approach in proxy materials based on their anticipated disclosure obligations as well as investor expectations on ESG. [4]
• Board oversight of artificial intelligence (AI). Investor attention to AI governance has become a recurring engagement theme, including questions about board oversight, risk management, and—where relevant—board-level expertise. Companies should consider whether disclosure of AI governance practices or board-level AI expertise is merited in the proxy statement, in addition to being prepared for AI-related questions from shareholders. [5]

2. Proxy advisors are under attack but continue to play a role in proxy season (and outcomes may be less predictable).

Proxy advisory firms, primarily Institutional Shareholder Services (ISS) and Glass Lewis (GL), are under fire, including through an executive order (EO) directing the SEC, Federal Trade Commission and U.S. Department of Labor to address what the EO describes as “the outsized influence of proxy advisors that prioritize radical political agendas over investor returns.” Despite this mandate, meaningful change is unlikely to occur this proxy season. That said, some institutional investors have reduced or re-tooled their reliance on proxy advisory firms, which may make vote outcomes less predictable and shareholder engagement more important. Companies should reassess the influence of proxy advisory firms on their current investor base, identify any proxy advisory firm policies that could result in negative vote recommendations for 2026 proxy proposals, and consider whether their proxy narratives address or should address known proxy advisory pressure points. For a discussion of ISS and GL updates for the 2026 proxy season, please see our previous client alert and Known Trends post.

In addition, GL has announced a significant shift in its longer-term approach to proxy advisory services—moving away from a single “house” policy that uniformly governs voting recommendations. While that change may not be fully operational this season, it is directionally important and should be monitored.

3. Shareholder engagement continues to evolve, requiring company time and attention.

Engagement dynamics shifted meaningfully last season. Early in the 2025 cycle, the SEC staff revised its guidance on how engagement with companies may affect a beneficial owner’s active/passive status for purposes of filings on Schedule 13G and Schedule 13D. After issuance of the guidance, some institutional investors paused shareholder engagement briefly. Engagement has resumed, with changes. Some investors now provide a disclaimer at the beginning of a meeting, express a greater preference for the company to take the lead in framing the conversation, or participate in meetings in “listen-only” mode.

In addition, BlackRock, Vanguard, and State Street—the largest index investors—each split their governance teams based on active, passive, and sustainability-focused investor interests to better align with how the assets are managed at each institution. This could complicate engagement efforts in 2026, with separate assets being managed by different teams with their own voting and engagement frameworks.

As companies approach shareholder engagement, they can consult our recent white paper, “Navigating Shareholder Engagement and Shareholder Activism: Essentials and Best Practices,” as a helpful resource, whether they are looking to start, refresh, or update their shareholder engagement practices.

A development to watch: retail voting programs. In September 2025, the SEC staff issued a no-action letter to ExxonMobil that enabled the company to proceed with a program to allow its retail voters (whose voting participation levels have historically been low) to issue standing voting instructions to vote their shares at annual meetings in favor of the board’s recommendations, subject to specific requirements articulated in the no-action letter. While not right for every company, such programs may make sense for some companies as an engagement tool to reach a large retail shareholder base that may wish to support the board’s recommendations annually or companies with proposals that are approved or not approved by a small margin. We understand that Broadridge, which implemented the ExxonMobil retail voting program, may expand capacity for additional companies in future years, although some companies may also wait to see what happens in shareholder suits challenging ExxonMobil’s program.

4. Rule 14a-8 shareholder proposals: a “brave new world,” with more potential change ahead.

The Rule 14a-8 shareholder proposal landscape has seen dramatic changes in the last 12 months, with more changes possible. The SEC’s regulatory agenda indicated that the agency anticipates proposing rule changes this year to modernize Rule 14a-8.

Meanwhile, in February 2025, the SEC staff issued Staff Legal Bulletin No. 14M (SLB 14M), which rescinded Staff Legal Bulletin No. 14L, providing guidance and reinstating prior interpretations. In practice, this has provided a clearer path for companies seeking no-action relief to exclude certain proposals. For more information on SLB 14M, please see our previous client alert.

This fall, two additional developments occurred that injected substantial uncertainty into the shareholder proposal process this season. First, in fall 2025 remarks, SEC Chairman Paul S. Atkins questioned whether non-binding shareholder proposals are permissible under state law. In doing so, he noted that a provision under Rule 14a-8 allows for exclusion of a proposal that is not a proper subject under state law and that the SEC would be open to receiving no-action requests on that basis. Second, in the wake of the federal government shutdown last year, the SEC’s Division of Corporation Finance (Division) announced that, at least for the 2026 proxy season, the Division would largely refrain from providing responses to no-action requests from companies seeking to exclude shareholder proposals from their proxy materials.

Companies seeking to exclude a proposal must continue to comply with the notice requirement in the rule, providing notice to the SEC and the shareholder proponent about its intent to exclude and its reasons therefor. Generally, the Division will not respond to such notices; however, if a company would like a response, the company’s notice should include a representation that it has a reasonable basis to exclude based on Rule 14a-8, prior guidance, or judicial decisions. This stance has injected uncertainty for both companies and investors. Some investors have objected to the Division’s stance. For example, the Council of Institutional Investors expressed its concern “that [it] could diminish the use of an important shareholder right that for decades has led to improvements in corporate governance that benefit long-term shareholder value.” But early indications suggest otherwise. Recent data from Proxy Analytics LLC shows that notices to exclude are down 29 percent year-over-year from January 31, 2025 to January 31, 2026. Most notices rely on procedural grounds (61 percent), instead of substantive grounds (39 percent), to exclude Rule 14a-8 proposals. Even so, at least three well-funded shareholder proponents who were notified that their proposals would be excluded from proxy materials sued in federal court to compel the companies to include their proposals included, and as a result, at least two of the companies have agreed to include the proposals rather than litigate. For more information on the staff’s shift relating to no-action responses, please see our previous client alert.

Consistent with Chairman Atkins’s remarks about the permissibility of non-binding shareholder proposals under state law, the Division’s announcement indicated that it would consider no-action requests to exclude proposals under Rule 14a-8(i)(1) on the basis that the proposal is not a proper subject for shareholder action. To date, according to the SEC’s website, no company has sought to exclude a proposal on this basis. While the SEC may issue a no-action letter in response to a notice to exclude, the question of whether a shareholder proposal may be excluded as not a proper subject for action under state law will likely require judicial resolution.

A company that determines to exclude a proposal from its proxy materials should carefully consider how it frames its arguments for exclusion of the proposal in its notice to the SEC and shareholder proponent, as well as in other disclosures and the proxy materials. Some companies have disclosed in their proxy materials that they have excluded a proposal and engaged with the shareholder proponent to explain their position, rather than staying silent on the matter.

5. The plaintiff’s lawyers are reading: dot your “i’s” and cross your “t’s” in your proxy statement.

We continue to see plaintiff’s lawyers reviewing preliminary and definitive proxy statements to look for alleged disclosure deficiencies or compliance issues under Delaware law or SEC requirements—often followed by demand letters seeking curative disclosure and attorneys’ fees (which can sometimes be substantial) for the claimed corporate benefit they provided by ensuring compliant disclosure. Common issues we see raised include:

• noncompliant record date;
• incorrect voting standards;
• failure to describe the impact of broker non-votes and abstentions on each proposal;
• incorporation by reference to Form 10-K of executive compensation information that does not actually exist in the Form 10-K;
• failure to disclose late Section 16 filings;
• incorrect determination of board or board committee independence under stock exchange standards; and
• defective description of equity plan subject to a proposal.

In most cases, these deficiencies are preventable with careful reviews.

For more information on proxy season matters and for assistance, please contact any member of the firm’s Public Company Representation, Employee Benefits and Compensation, Environmental, Social, and Governance, or Shareholder Engagement and Activism practices.

1 For updates relating to annual reports on Form 10-K (Form 10-K), please see our previous alert, Reporting Season Alert: Five Key Reminders for Form 10-K Filings. (go back)

2 For more information on these developments, please see our previous client alerts, available here and here. (go back)

3 See Regulation S-K Item 407(c)(2)(iv). (go back)

4 For more information on developments relating to the SEC’s climate-disclosure rule litigation, please see our previous Known Trends posts, available here and here. For more information on California developments, please see our previous Known Trends, available here, and for more information on climate disclosure rules in Europe, please see our previous client alert, available here. (go back)

5 See Regulation S-K Item 407(h), which requires disclosure of the board’s role in risk oversight. (go back)