SEC Proposes to Rescind Rule 14a-8, Amend Rule 14a-4, and Amend Other Proxy Rules

On September 16, 2026, the SEC proposed, among other things, to eliminate its rules granting shareholders the right to require the inclusion of certain of their proposals for shareholder action in the company’s proxy statement, leaving the authority to create and define such a right to state corporate law and each company’s governing documents. Specifically, the proposal would: (i) rescind Exchange Act Rule 14a-8; (ii) amend Exchange Act Rule 14a-4 to expand the circumstances under which a company may exercise, with respect to proxies it receives, discretionary voting authority on proposals that will be presented at a shareholder meeting but not included in the company’s proxy materials; and (iii) amend other proxy rules to facilitate the implementation of the foregoing. Comments on the proposal must be received on or before November 20, 2026.

Exchange Act Rule 14a-8

The conduct of shareholder meetings, including how proposals are presented, is governed by state law. The predecessor to Rule 14a-8, as originally adopted in 1942, was intended to facilitate the ability of shareholders under state law to present certain proposals for consideration at a company’s annual or special meeting. Over time, however, various amendments to the rule have increased the SEC’s role in “defining and interpreting standards that implicate core state law corporate governance matters, such as shareholder voting rights.” As stated in the proposal, the rule currently operates “as a substantive Federal overlay that improperly intrudes into matters of state law by dictating that companies include (or allowing them to exclude) certain shareholder proposals in the companies’ proxy materials.” As the conditions and exclusions in the rule “bear little or no connection to whether the proposal is proper for a shareholder vote at the shareholder meeting under state law,” the SEC is proposing to rescind the rule as exceeding its statutory authority “by improperly intruding into state law without express authorization from Congress.” The SEC further notes that even if all or a portion of the rule were within its statutory authority, there are independent policy reasons for recission, including that: (i) the original justifications for the rule “have not been substantiated in practice or are less compelling today;”¹ (ii) the rule has had unjustified unintended consequence;² and (iii) even if authorized by law, the rule represents unwarranted “entanglement in state law issues.” The SEC believes that rescinding the rule would eliminate any federal law preemption implications, or any other disincentive for states to develop their own laws governing shareholder proposals. As a result, if the proposal is adopted, state law or, to the extent permitted by state law, a company’s governing documents, would determine whether a shareholder proposal would be required to be included in a company’s proxy materials.

Exchange Act Rule 14a-4

Rule 14a-4(c) addresses the circumstances under which a proxy card submitted by a shareholder may confer discretionary voting authority on the proxyholder for matters not included on the proxy card. Rule 14a-4(c)(1) permits such discretionary voting at an annual meeting on matters for which the company did not receive timely notice (45 days before the date on which the company first mailed its proxy materials for the prior year’s annual meeting, or otherwise, in accordance with an applicable advance notice bylaw provision), provided that a specific statement that such discretionary authority is granted is included in the company’s proxy statement or form of proxy, and Rule 14a-4(c)(2) permits such discretionary voting at an annual meeting on matters which the company did receive timely notice, if the company’s proxy statement includes “advice” on the nature of the matter and how such discretion will be exercised, unless the proponent solicits a sufficient number of shareholders in accordance with the rule. Rule 14a-4(c)(3)-(7) describes additional matters on which a proxy may confer discretionary authority.

The SEC notes that companies may feel compelled to include certain shareholder proposals received outside of Rule 14a-8 on their proxy cards (i.e., all proposals if that rule is rescinded), even where not required, in order to seek and exercise proxy voting authority on the proposal. To address this issue, under the proposal, Rule 14a-4(c)(2) would be amended to no longer prohibit a company from exercising discretionary voting authority with respect to timely received shareholder proposals submitted outside the Rule 14a-8 process, regardless of whether the proponent delivers its own proxy materials to requisite shareholders, so long as the company includes: (i) a brief description of the matter in its proxy statement³ and how the company intends to use its discretionary authority; (ii) a cross-reference on the proxy card to the location of this disclosure; and (iii) a check box on the proxy card that, if checked, would prevent the company from exercising its discretion with respect to their individual shares. 

As a result, a proponent’s proxy card could include the company’s nominees, management proposals, and the proponent’s proposals, while the company’s card could include only the company’s nominees and management proposals. The company could then exercise discretionary voting authority to vote proxies it receives against the proponent’s proposals, other than proxy cards where the box is checked. Although only one check box would be required, a company could voluntarily provide multiple check boxes for multiple non-management proposals subject to discretionary voting authority.

Other Proposed Amendments

Rule 14a-4(c) would be clarified to state that discretionary voting authority only relates to matters that are not included on the proxy card, and Rule 14a-4(c)(1) would be amended to clarify that a company’s advance notice provision, or an applicable state or foreign law provision, determines whether a company has received “timely” notice of a matter, and, only in the absence of such a provision would the default deadline under Rule 14a-4(c)(1) (i.e., the 45 day rule) apply. Rule 14a-4(c)(1) would also be amended to provide that if during the prior year the registrant did not hold an annual meeting, or if the date of the meeting has changed more than 30 days from the prior year, then notice must not have been received a reasonable time before the registrant sends its proxy materials for the current year (unless a provision of applicable state or foreign law or the registrant’s governing documents establishes an applicable deadline for such notice, in which case such deadline applies).

The SEC is proposing to delete Rule 14a-4(c)(6), which currently states that a proxy may confer discretionary authority to vote on any proposal omitted from the proxy statement and form of proxy pursuant to 14a-8 or 14a-9 (prohibition against false or misleading statements in proxy materials), as Rule 14a-8 is proposed to be rescinded, and retaining the provision with only a reference to Rule 14a-9 may further expand the ability of companies to use discretionary voting authority without providing the disclosure required by proposed Rule 14a-4(c)(2).

Rule 14a-5(e) requires certain deadlines to be disclosed in all proxy statements. If Rule 14a-8 is rescinded, Rule 14a-5(e)(1) and (2) would be amended to eliminate references to Rule 14a-8. The deadline to be disclosed under proposed amended Rule 14a-5(e)(2) would be the deadline established under an applicable state or foreign law provision or the company’s governing documents, or, in the absence of such a provision, the default deadline under Rule 14a-4(c)(1).

Rule 14a-5(f) is proposed to be amended to require disclosure of changed deadlines under any applicable provision of Rule 14a-5(e), including deadlines for submitting nominees for inclusion in the registrant’s proxy statement and form of proxy, and for providing notice of a solicitation of proxies in support of director nominees other than the registrant’s nominees pursuant to Rule 14a-19 for the registrant’s next annual meeting (unless the registrant is a registered investment company or a business development company).

Rule 14a-6(a), which governs when preliminary proxy statements are required, is proposed to be amended to provide that a company need not file a preliminary proxy statement solely because of the submission of a shareholder proposal, unless such shareholder proposal (or the company’s election of directors) is known or reasonably should be known to the company to involve a “solicitation in opposition,” including any solicitation (other than a solicitation exempt under Rule 14a-2): (i) subject to Rule 14a-19; (ii) to vote against or withhold votes from any of the registrant’s director nominee(s); (iii) to vote against a proposal that the registrant expressly supports in its proxy materials; and (iv) to vote in support of a proposal that the registrant does not expressly support in its proxy materials.⁴

The proposal would also remove Item 4 from Schedule 14C and amend Rule 14c-5(a) to remove the references to Item 4. Currently, if a company will distribute a required information statement and a shareholder has submitted a proposal for action at the shareholder meeting a reasonable time before the company distributes the information statement, the company must “make a statement to that effect, identify the proposal and indicate the disposition proposed to be made of the proposal by the [company] at the meeting.” If Rule 14a-8 is rescinded and Rule 14a-4(c)(2) is amended as proposed, the only circumstance in which a company would be expressly required by the Federal proxy rules to identify or describe a shareholder proposal in its proxy materials would be if the company is seeking to exercise discretionary voting authority with respect to a proposal not included on its proxy card under proposed Rule 14a-4(c)(2). Since this would not apply to an information statement, Item 4 of Schedule 14C would be removed, so that shareholders receiving proxy statements and information statements receive equivalent information.

© Arnold & Porter Kaye Scholer LLP 2026 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.