SEC Proposes Rescission of Rule 14a-8: SEC Moves to Eliminate the Shareholder Proposal Rule and Modernize Proxy Solicitation

On Sept. 16, 2026, the Securities and Exchange Commission (SEC) issued two proposing releases that would fundamentally reshape the federal proxy rules. In Release No. 34-106383, the SEC proposed to rescind Rule 14a-8 — the rule that has governed the inclusion of shareholder proposals in company proxy materials for decades (it or its predecessor rule has been in place since 1947) — and to amend Rule 14a-4(c) to address discretionary proxy voting authority. In a companion release (Release No. 33-11439), the SEC proposed a series of amendments to modernize the proxy solicitation process. SEC Chairman Paul S. Atkins stated that the proposals “reflect two of my highest regulatory priorities”: ensuring the SEC “does not improperly intrude into state corporate law” and “updating the Commission’s rules to reflect developments in market practice and technology.”

The Staff’s 2025-2026 Retreat From Rule 14a-8

The SEC’s proposal to rescind Rule 14a-8 follows a series of steps by the SEC’s Division of Corporation Finance (Division) to withdraw from the shareholder proposal process. On Nov. 17, 2025, the Division announced a pilot “no response” practice for the 2025-2026 proxy season under which it would no longer respond to company no-action requests seeking to exclude shareholder proposals under Rule 14a-8 other than requests regarding proposals that are potentially improper subjects under state law.

On Aug. 14, 2026, the Division made this practice permanent and expanded it, announcing it would permanently discontinue responding to all no-action requests under Rule 14a-8, including those potentially improper under state law. The Division also eliminated the November 2025 “no objection” letter accommodation. As discussed in McGuireWoods’ August 2026 client alert, SEC Staff Exits the Rule 14a-8 Shareholder Proposal Process: Corp Fin Expands and Extends Its ‘No Response’ Practice Indefinitely, these developments leave exclusion decisions resting entirely on the company and its counsel, with a proponent’s primary means of challenging a company’s decision to exclude a proposal being a judicial proceeding to compel inclusion. The recent proposal on Rule 14a-8 goes further by seeking to eliminate the federal shareholder proposal framework altogether.

Proposed Rescission of Rule 14a-8

The SEC proposes to rescind the rule “in its entirety because the rule exceeds the Commission’s statutory authority under section 14(a) by improperly intruding into State law without express authorization from Congress.” According to the SEC, Section 14(a) empowers the SEC to facilitate, not alter, state law rights by regulating the manner of solicitation and the information disclosed.

The SEC also articulated independent policy reasons for rescinding the rule, noting that many of the original justifications for Rule 14a-8 have not been substantiated in practice or are less compelling today:

• Rule 14a-8 has become a mechanism for influencing interactions between companies and their shareholders in ways inconsistent with the rule’s original purpose.
• The rule places the SEC in the position of making judgments about the application of state law that are best left to other actors.
• The presence of a federal rule has inhibited the development of state law and private ordering, including the implication of federal preemption that may have discouraged states from developing their own laws governing shareholder proposals.

If adopted, determinations regarding shareholder proposals would be left to state law and a company’s governing documents (e.g., articles or certificate of incorporation and bylaws). The proposed rescission would apply to all companies subject to the proxy rules, including registered investment companies and business development companies.

Proposed Amendments to Rule 14a-4(c)

Rule 14a-4(c)(1) provides that a company may exercise discretionary voting authority with respect to a matter raised at an annual meeting but not included in the company’s proxy materials, provided the company did not receive notice of the matter at least 45 days before the date on which the company first sent its proxy materials for the prior year’s annual meeting (or such other date as specified by the company’s advance notice provision).

Under Rule 14a-4(c)(2), when a company has received timely notice and has disclosed in its proxy statement the nature of the matter and how it intends to exercise its discretion, the company may not exercise discretionary voting authority if the proponent: provides the company with a timely written statement of its intent to deliver a proxy statement and form of proxy to holders of at least the percentage of the company’s voting shares required under applicable law to carry the proposal; includes that same statement in its filed proxy materials; and, after soliciting, provides the company with evidence that the necessary steps have been taken to deliver those materials to the requisite percentage of holders.

The SEC noted that this framework can compel companies to include shareholder proposals on their proxy cards even when neither the federal proxy rules nor state law requires their inclusion — a dynamic the SEC has characterized as an unintended consequence of the current rule. The proposed amendments would permit a company to exercise discretionary voting authority over a proposal presented at the meeting but not included in the company’s proxy materials if (i) its proxy statement includes a brief description of the matter and how the company intends to exercise voting discretion; (ii) its proxy card cross-references that disclosure; and (iii) the proxy card includes a check box allowing each shareholder to prevent the company from exercising that authority with respect to the shareholder’s own shares, with a single opt-out box permitted to cover multiple proposals. The SEC states that the Rule 14a-4 amendments have independent justifications and could be adopted even if the Rule 14a-8 rescission is not.

Proposed Modernization of the Proxy Solicitation Rules

In a separate proposing release (Release No. 33-11439), the SEC proposed amendments to modernize various provisions of Regulation 14A. Many of the current proxy solicitation rules have not been amended in decades. The key proposals include:

• Replacement of the Annual Report to Securityholders (ARS) Delivery Requirement. Proposed amended Rule 14a-3 would require that a proxy statement for a meeting at which directors will be elected be preceded by either (i) the filing of the company’s Form 10-K for its most recent fiscal year on EDGAR or (ii) the furnishing of an annual report to shareholders on EDGAR that meets the rule’s requirements. The proposal would not prevent a company from voluntarily sending an ARS, such as a “glossy” annual report, so long as it also submits it on EDGAR; those reports would remain furnished rather than filed and therefore outside Exchange Act Section 18 liability. The proposal also would remove the “integrated” Form 10-K alternative under Rule 14a-3(d) and General Instruction H.
• Elimination of the Incorporation-by-Reference Delivery Deadline. The proposal would eliminate the requirement that a company send its proxy statement to shareholders no later than 20 business days prior to the meeting date when information is incorporated by reference in the proxy statement. This change would provide greater flexibility when planning shareholder meetings, particularly meetings relating to mergers or business combination transactions. The SEC stated that this requirement is no longer necessary because incorporated filings are easily accessible on EDGAR and companies can send copies electronically on request.
• Rescission of Notices of Exempt Solicitation. The proposal would rescind Rule 14a-6(g), which requires any shareholder owning more than $5 million of a company’s securities to submit a Notice of Exempt Solicitation on EDGAR for certain written exempt solicitations. The amendments would eliminate such notices altogether — whether required or voluntary — and are intended to reduce investor confusion, improve accessibility of information on companies’ EDGAR pages and reduce compliance burdens. If the rule is rescinded, companies that monitor these filings should plan for alternative ways to track shareholder communications.
• Shortened Broker Search Period. The proposal would shorten the minimum broker search period from 20 business days to five business days before the record date for the meeting. The SEC states that broker searches can now often be completed in as few as three days and that the current period may unnecessarily delay transactions, special meetings and contested director elections. The proposal would not shorten the existing seven-business-day response periods for brokers and banks under Rules 14b-1 and 14b-2. The SEC requests comment on whether those periods should also be shortened, potentially to three business days, because they otherwise could extend beyond the proposed five-business-day search period. Corresponding changes would apply to information statements under Regulation 14C.
• Preliminary Proxy Statements and Related Amendments. Proposed amended Rule 14a-6 would provide that a preliminary proxy statement is not required solely because of any shareholder proposal. Currently, that accommodation applies only to Rule 14a-8 proposals. A preliminary proxy statement would still be required when the shareholder proposal or election of directors involves a solicitation in opposition.

• Contact Information and Technical Amendments. Cover pages of Schedule 14A and Schedule 14C would be revised to require contact information for a representative who can respond to questions or comments regarding the filing. Various technical amendments would remove obsolete references and correct typographical errors.

Practical Implications for Public Companies

The proposed rescission of Rule 14a-8 would represent a seismic shift in the shareholder proposal landscape. Companies should keep in mind the following:

• Rule 14a-8 Remains in Effect. Rule 14a-8 remains in effect during the pendency of the rulemaking. Rule 14a-8 shareholder proposals are generally due 120 calendar days before the anniversary of the release date of the prior year’s proxy statement, which for many calendar-year companies falls in November and December 2026. Proposals for 2027 annual meetings therefore will arrive while the rescission of Rule 14a-8 remains only proposed. Companies must continue to comply with Rule 14a-8 and its Rule 14a-8(j) notice mechanics, including filing the notice with the SEC and the proponent at least 80 calendar days before the definitive proxy statement is filed.
• Exclusion Analysis Remains With the Company. Because the Division no longer issues no-action responses, companies already bear the full burden of the exclusion analysis. During the 2026 proxy season, after the Division first halted substantive review of most Rule 14a-8 exclusions, six lawsuits were filed by shareholder proponents challenging exclusions. Three were withdrawn after the company agreed to include or implement the proposal; two were decided in favor of the company; and one was decided in favor of the proponent. Rescission would remove the federal framework that analysis is built on and shift the inquiry entirely to state law and a company’s governing documents (e.g., articles or certificate of incorporation and bylaws).
• Floor Proposals and “Zero Slate” Campaigns. Following the amendments adopted in connection with the universal proxy rules, a shareholder proponent conducting its own proxy solicitation for a shareholder proposal may include the company’s own director nominees on the proponent’s proxy card, even though the proponent does not nominate any competing director candidates of its own. This structure is referred to as a “zero slate” campaign — the proponent runs a solicitation with no director slate of its own. Because the proponent’s card lets shareholders vote on both the company’s director nominees and the proponent’s proposals, shareholders may be more likely to use the proponent’s card rather than the company’s card if the company omits those proposals from its own proxy card, creating pressure for the company to include the proposals on its own card. Because the proponent does not nominate or solicit proxies for its own director nominees, Rule 14a-19 does not apply. The SEC has observed at least three zero slate campaigns since the universal proxy rules took effect in 2022. The Rule 14a-4(c) amendments respond to concerns that these types of campaigns can pressure companies into including otherwise excludable proposals, but the amendments would not prohibit these types of campaigns and could elevate them as an activist tool. If a proponent runs its own solicitation, a company may need to weigh itemizing the proponent’s proposals on its own proxy card against relying on the brief-statement approach and retaining discretionary authority and may be required to file a preliminary proxy statement in that scenario.

• State Law and Governing Documents. State law and provisions of companies’ articles or certificates of incorporation and bylaws will receive greater attention. Companies should assess existing shareholder rights under the law of their state of incorporation, evaluate how their advance notice provisions intersect with Rule 14a-8 and monitor state legislative developments. In 2025, Texas added Section 21.373 to the Texas Business Organizations Code, which permits Texas-incorporated companies to amend their bylaws to bar shareholder proposals unless the proponent has held the lesser of $1 million in market value or 3% of the company’s outstanding voting shares for at least six months through the meeting and solicits holders of at least 67% of the voting power entitled to vote on the proposal. To our knowledge, no other state, including Delaware, currently includes a comparable provision governing shareholder proposal eligibility.
• Private Ordering. Absent Rule 14a-8, investors may press companies to adopt Rule 14a-8-like proposal rights in their governing documents, much as shareholders used Rule 14a-8 to seek proxy access bylaws after Rule 14a-11 was vacated in 2011.
• Proposal Volume May Not Decline. Commissioner Mark Uyeda cautioned that, in a post-Rule 14a-8 world in which the rule’s substantive exclusion bases disappear, the number and scope of proposals could actually increase when neither state law nor a company’s governing documents restrict what may be submitted for a shareholder vote. Rescission of Rule 14a-8 therefore would not automatically reduce the shareholder proposal volume.

Comment Period and Next Steps

As noted above, Rule 14a-8 and the current shareholder proposal process will most likely remain in place for the 2026-2027 proxy season. However, given the potential seismic shift in the shareholder landscape if the rescission of Rule 14a-8 is adopted, companies should use the comment period to evaluate how these proposals, if adopted, would affect their proxy season planning, shareholder engagement strategies and governance frameworks.

McGuireWoods continues to monitor these developments and will provide additional updates as the rulemaking progresses. For questions about the SEC’s proposed rescission of Rule 14a-8, the proposed proxy solicitation amendments or planning for the 2026–2027 proxy season, contact the authors, your McGuireWoods contact or a member of the firm’s Public Company Advisory Practice Group.