Conference | November 18, 2025
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Mayer Brown is pleased to sponsor The Character of the Corporation 2025.  This forum brings together public company board members, institutional shareholders, proxy advisors, judicial and governmental representatives and corporate governance thought leaders to discuss effective governance, geopolitical conflict and crisis management.

If you are interested in attending the conference and would like to receive exclusive registration discounts, please email Hanson Hairihan.

10-K and Disclosure TrendsProxy Statement and Annual Meeting Preparation
Webinar | November 10, 2025
12:00 p.m. – 1:00 p.m. EDT
Register here.

The proxy and annual reporting season may seem a long way off. However, in light of the amount of work and planning that goes into the proxy statement, annual report, and annual meeting of shareholders, this is the ideal time to begin preparations. Companies will have to weigh various considerations this upcoming proxy season, including the objectives of new leadership at the U.S. Securities and Exchange Commission.  Join a team of Mayer Brown panelists for a series of two webinars to discuss the key issues for the upcoming 2026 season.

This first session, on November 10, 2025, will focus on considerations for the preparation of annual reports, including disclosure trends, hot topics, and compliance tips. Themes to be discussed include, among others:
– Considerations related to risk factor disclosures
– Artificial intelligence
– Cybersecurity and climate change disclosure trends
– Financial reporting issues, including non-GAAP disclosures, critical accounting estimates, and segment reporting
– Beneficial ownership reporting
– Filer status determinations
– Director and Officer questionnaires		Webinar | November 19, 2025
1:00 p.m. – 2:00 p.m. EDT
Register here.

Join us for the second of two webinars to discuss the key issues for 2026, including the objectives of new leadership at the U.S. Securities and Exchange Commission. During this session, Mayer Brown lawyers Ryan Liebl, Ali Perry, Liz Walsh, and Jennifer Zepralka, as well as Edward Greene, Managing Director, Georgeson Advisory, will discuss the following topics, among others:
– Recent proxy statement developments
– Proxy voting matters and trends in shareholder proposals
– Environmental and social matters
– Shareholder engagement
– Executive compensation disclosures
– Recent SEC guidance relevant to proxy statements and shareholder proposals

On October 14, 2025, Glass Lewis announced that it will no longer offer its benchmark voting recommendations starting in 2027.  In lieu of benchmark voting recommendations, it will instead offer a set of options.  Glass Lewis cited the growing split between how the United States and European investors approach issues like fiduciary duties and sustainability. Also, as reported by Reuters, a Glass Lewis spokesperson explained that the change is indirectly a result of criticisms that it has faced from U.S. Republican politicians, stating “[t]he whole geopolitical environment is attached to this.”

Over the past year, Glass Lewis and Institutional Shareholder Services (“ISS”), the two dominant proxy advisory firms, have been under pressure from politicians with respect to topics like executive pay, diversity, equity and inclusion (“DEI”) initiatives and environmental politics.  For example, in Texas, a new law, known as Senate Bill 2337 (“SB 2337”) imposed new regulations on proxy advisory firms. SB 2337 scheduled to take effect on September 1, 2025. However, on August 29, 2025, the U.S. District Court for the Western District of Texas issued a preliminary injunction against SB 2337, blocking its enforcement against ISS and Glass Lewis. The trial is set for February 2, 2026. If SB 2337 is upheld, proxy advisors issuing recommendations for companies that are either headquartered in Texas, incorporated in Texas, or redomesticating to Texas will be subject to significant new disclosure and procedural requirements.

Also, notably earlier this year, while ISS and the major institutional investors revised their proxy voting guidelines mid-proxy season to address a series of Presidential executive orders related to DEI, Glass Lewis stayed firm and retained its existing guidance, which included benchmarks related to diversity in board composition.

In the keynote address at the John L. Weinberg Center for Corporate Governance’s 25th Anniversary Gala, Securities and Exchange Commission (“SEC”) Chair Paul Atkins noted that the number of exchange-listed companies has declined in recent years and outlined a three-part agenda aimed at making the US public markets more attractive to companies, including (1) simplifying and scaling disclosure requirements, (2) de-politicizing shareholder meetings, and (3) reforming securities litigation.  His statements with regard to precatory shareholder proposals and Rule 14a-8 marks a potentially significant departure from the current approach, with the potential to dramatically change the shareholder proposal landscape even in the absence of regulatory reform.

Potential Exclusion of Precatory Shareholder Proposals under Rule 14a-8(i)(1)

A central focus of Chair Atkins’ remarks was the increasing “politicization” of shareholder meetings through precatory, or non-binding, shareholder proposals.  To this end, Chair Atkins cited the increasing frequency of precatory proposals focused on social and environmental issues that, in his view, “frequently involve issues that may not be material to a company’s business,” but still require substantial management time and attention.  Continuing, he questioned whether Rule 14a-8(i)(1) of the Securities Exchange Act of 1934, as amended, actually permits companies to exclude such proposals, and concluded that this is likely the case, at least with regard to Delaware companies.

Specifically, Rule 14a-8(1)(i) permits a company to exclude a proposal that is not a “proper subject” for shareholder action under state law, which raises a question as to whether precatory proposals are, indeed, “proper subjects.”  In the notes to Rule 14a-8(1)(i), the SEC Staff states that  it “will assume that a proposal drafted as a recommendation or suggestion is proper unless the company demonstrates otherwise,” creating a presumption that a precatory proposal is a “proper subject.”  Taking the opposite view, Chair Atkins argued that, under Delaware law, precatory proposals might not be “proper subjects” because Delaware law does not explicitly provide shareholders with the right to vote on non-binding matters.  Chair Atkins suggested that a company could, on advice of counsel that a proposal is not a “proper subject” under state law, seek to rely on Rule 14a-8(i)(1) to exclude such a proposal, expressing his “high confidence” that the SEC Staff would “honor” this position, at least with regard to that specific company.  However, this would not prohibit a proposal proponent from submitting an opposite opinion.  As such, Chair Atkins raised an open question as to whether the SEC would take the issue to the Delaware Supreme Court, should the SEC have to reconcile this argument between a company and a proponent.

Chair Atkins then turned to the operation of Rule 14a-8(1)(i) under other state law, pointing to new legislation in Texas that allows companies to require shareholders to meet higher ownership thresholds in order to be eligible to submit a shareholder proposal. Aligning with Commissioner Uyeda’s 2023 remarks, Chair Atkins noted that if a company opted for different state-level thresholds, such as those under the new Texas law, “or has otherwise properly established conditions in its governing documents,” and subsequently receives a proposal from a proponent that does not satisfy the Texas law requirements or the relevant governing documents, then the proposal might be excludable under Rule 14a-8.

Chair Atkins concluded his Rule 14a-8 remarks by calling for a “fundamental reassessment” of the rule’s premise, especially given that the Exchange Act itself is intended to govern disclosure.  Should shareholders be able to “force companies” to solicit for their proposals at minimal cost to the shareholder, and what role does the rule play in today’s capital markets?

Securities Litigation Reform

Chair Atkins also discussed the need for federal securities litigation reform, expressing concern that meritless lawsuits increase costs and discourage companies from going public in the United States. He criticized Delaware’s recent Senate Bill (“SB”) 95, which prohibits mandatory arbitration and fee-shifting for federal securities law claims, calling these provisions “two giant steps backward” in efforts to modernize Delaware corporate law.  In closing, Chairman Atkins acknowledged the SEC’s recent statement on mandatory arbitration (read about it here), which is not consistent with the provisions of SB 95, stating that “with the benefit of clarity under the federal securities laws, I hope that the Delaware legislature will revisit the prohibition of both mandatory arbitration and fee shifting with respect to federal securities law claims.  Doing so can help Delaware be a leader in the reform of securities litigation.”

Read Chair Atkins’ remarks here.

In late 2023, California enacted a landmark set of climate-related disclosure laws—collectively referred to as the “California Climate Accountability Package”—which require disclosures of greenhouse gas emissions (SB 253) and climate-related financial risks (SB 261). As the first reporting deadlines approach in 2026, many businesses continue to face uncertainty regarding critical aspects of these laws. In this Legal Update, we highlight key recent developments, including CARB’s preliminary list of potentially covered entities and its latest interpretative guidance.

Continue reading this Legal Update.

Calls to consider the frequency of corporate reporting have resurfaced, driven by a rulemaking petition from the Long-Term Stock Exchange, the President’s social media posts, and remarks by SEC Chair Atkins.

On September 30, 2025, the Long-Term Stock Exchange (the “LTSE”) filed a rulemaking petition with the Securities and Exchange Commission (the “SEC” or the “Commission”) requesting that the SEC amend Rules 13a-13 and 15d-13 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as well as the general instructions to Form 10-Q.  The proposal would permit public companies to file comprehensive interim reports on a semi-annual basis, rather than quarterly, while maintaining current Form 10-K requirements and Form 8-K reporting for material events.  Companies would have the option to report on a quarterly basis.

In its petition, the LTSE argues that the quarterly reporting regime incentivizes companies to focus on short-term results at the expense of long-term strategy and innovation.  By allowing companies the option to report on a semi-annual basis, the LTSE believes that public companies will be better positioned to prioritize sustainable growth, reduce unnecessary compliance costs, and align their reporting practices with those in other major markets such as the European Union and the United Kingdom.  The LTSE also notes that this change would be optional, preserving flexibility for companies that wish to continue quarterly reporting.

Debate over the frequency of interim reporting for U.S. public companies has resurfaced periodically. In recent years, some policymakers have questioned whether quarterly reporting promotes excessive short-termism.  The President suggested that companies should move to six-month reporting cycles. Shortly thereafter, SEC Chair Atkins indicated that the Commission was evaluating whether to propose rule changes that would permit semi-annual reporting.  As with any rulemaking, the SEC would need to conduct a formal notice-and-comment process before amending its regulations. Speaking at Georgetown’s Financial Markets Quality Conference, Chair Atkins noted that the SEC may seek public feedback on whether a “one-size-fits-all” reporting model remains appropriate, observing that smaller issuers might benefit from reduced compliance costs while others may prefer to continue quarterly disclosures.  Read the full petition.

Webinar | October 15, 2025
12:00 p.m. – 1:00 p.m. EST
Register here.

Join us for a virtual moderated conversation with Jonathan F. Foster, author of On Board: The Modern Playbook for Corporate Governance.

As a former banker and a director of many public and private companies, Jonathan F. Foster brings to bear practical experience and insights in a “playbook,” not an academic tome. On Board is the ultimate guide for corporate directors, executives, governance professionals, and students navigating today’s fast-evolving business landscape. This essential resource delivers a historical perspective, data-driven insights, and stories from inside boardrooms on board leadership, fiduciary duties, CEO issues, regulatory compliance, and governance best practices.

We will discuss some of the learnings that general counsel, corporate secretaries, outside counsel, directors, and aspiring directors might consider in their roles as well as some of the challenges that face today’s boards of directors, including mergers and acquisitions and restructurings, the increasing importance of institutional investors, as well as the role of environmental, social and governance (ESG) concerns. Read more about the book.

EY’s recent SEC Reporting Update highlights 2025 trends in comment letters issued by the staff of the Securities and Exchange Commission (the “Staff”) to registrants about disclosures in their periodic filings.  The survey found that the volume of comment letters issued in the past year (ended June 30, 2025) declined, reversing the elevated volumes of comment letters issued in the prior two years.

Source: EY SEC Reporting Update No. 2025-01

The number of registrants that received comment letters also declined relative to last year.  However, the distribution of the total number of comment letters on Form 10-K and 10-Q filings remained almost identical to 2024.  Registrants with a public float of over $100 million received 53% of all comment letters (down from 54% in 2024), registrants with a public float between $75 million and $700 million received 25% of comment letters (no change from 2024), and registrants with a public float of less than $75 million received 22% of comment letters (up from 21% in 2024).

While traditional areas such as management’s discussion and analysis (MD&A) and non-GAAP remain dominant, EY notes that the Staff is attuned to broader macroeconomic and technological developments.  For example, registrants may see increased scrutiny of disclosures related to the impact of inflation, interest rate volatility, supply chain disruptions, and disclosures relating to cybersecurity, crypto assets, and artificial intelligence.

Key Focus Areas

MD&A.  The Staff frequently requests more specific explanations of material period-to-period changes, asking registrants to identify and quantify the underlying drivers, including offsetting factors, for revenue, COGS, gross profit and operating expenses.  Comments have focused on a need for more robust liquidity and capital resources discussions, including sources and uses of cash, trends and uncertainties (e.g., rate environment), and known trends impacting future results.  Comments also have requested clearer treatment of critical accounting estimates and key metrics, with analysis that goes beyond boilerplate and aligns with Item 303 expectations. 

Non-GAAP Financial Measures.  Staff comments related to non-GAAP measures include comments relating to undue prominence (e.g., leading MD&A with non-GAAP, non-GAAP income statements); inappropriate reconciliations (i.e., starting from operating income for adjusted EBITDA, or reconciling margins to non-GAAP bases); forward-looking non-GAAP that are missing quantitative reconciliations; and misleading adjustments that exclude normal, recurring expenses. 

Segment Reporting.  Staff comments have focused on the identification of operating segments and the identification of the “Chief Operating Decision Maker,” aggregation judgments, and completeness of required reportable-segment and entity-wide disclosures and related reconciliations under ASC 280.  The Staff expects disclosure of significant segment expenses and a clear distinction drawn from “other segment items,” challenging omissions or unclear categorizations.  The Staff will cross-check public communications (earnings calls, website, investor presentations) for consistency with reported segments and will question inconsistencies. 

Revenue Recognition.  The Staff frequently comments on disaggregation of revenue under ASC 606, asking registrants to select categories that reflect how revenue is viewed internally and communicated externally, and to explain the linkage to segment disclosures.  They probe identification and satisfaction of performance obligations, including judgments about timing (over time versus point in time) and the chosen measure of progress.  They also remind registrants to separately present material product versus service revenues and related costs on the face of the income statement under Regulation S-X Rule 5-03(b). 

Goodwill & Intangible Assets.  The Staff will ask for more detail on impairment analyses, such as methods, key assumptions, sensitivity, and how reporting units are identified and assigned assets/liabilities/goodwill.  Comments request disclosures about at-risk reporting units, the timing of impairment charges, and inclusion of relevant discussion in critical accounting estimates in MD&A. They also seek explanation of how useful lives of finite-lived intangibles were determined. 

Emerging Trends.  The Staff issued comment letters to registrants requesting expanded disclosure relating to new and emerging risks, including cybersecurity and crypto assets.  For example, the Staff has requested additional information regarding registrants’ disclosures about their cybersecurity risk management systems, in accordance with Item 106(c)(2)(i) of Regulation S-K.  The Staff issued comments requesting registrants to enhance their risk factors disclosures to include the material effects that specific regulations and material pending regulations relating to crypto assets, crypto markets, and artificial intelligence may have on the business and business plans.

Looking Ahead

Registrants should proactively evaluate their filings for the issues most frequently raised by the Staff and consider whether additional context or clarity would enhance their disclosures.  For additional details and analysis, read EY’s SEC Reporting Update: Highlights of trends in 2025 SEC staff comment letters.

Conference| October 9-10, 2025

Mayer Brown is pleased to be lead affiliate of Northwestern Law’s 45th Annual Ray Garrett Jr. Corporate & Securities Law Institute taking place October 9 – 10, 2025. Mayer Brown partner Jodi Simala is serving as the Institute Chair and partner Jennifer Zepralka will be a panelist for the “Managing through Missing Guidance Situations” session.

The Ray Garrett Jr. Corporate and Securities Law Institute provides both private practitioners and corporate counsel an opportunity to hear from SEC officials and Delaware judges and network with the corporate and securities law community. This year’s program will cover a variety of trending issues spanning legal, political, and financial impact on the M&A world and how these insights can be used to steer strategy through the end of the year into 2026.

For a comprehensive list of sessions, speakers and registration information, please visit the event website.

The California Air Resources Board (CARB) released a preliminary list of over 4,000 companies required to begin reporting under California’s new climate disclosure laws, Senate Bill (SB) 253 and SB 261. Signed into law just over a year ago, the laws apply broadly to large companies doing business in California, regardless of where they are headquartered, and are intended to establish greater transparency around emissions and climate-related risks.

Of the 4,160 companies identified, 2,596 will be subject to both SB 253 and SB 261, while 1,564 will be required to comply only with SB 261. Roughly 60% of the companies, or 2,503, on the list are headquartered outside California, underscoring the wide reach of the state’s requirements.

SB 253 applies to companies with more than $1 billion in annual revenues. Beginning in 2026, companies will be required to report Scope 1 and Scope 2 greenhouse gas emissions, with Scope 3 reporting, which covers value chain emissions, to follow in 2027. SB 261 applies to US companies with annual revenues exceeding $500 million. Covered companies must file biennial reports beginning in January 2026 describing climate-related financial risks and the steps taken to address those risks. 

CARB emphasized that the list, compiled using 2022 revenue data, is preliminary. The statutory thresholds are controlling and inclusion in the list or omission does not determine whether a company must comply.  

Earlier this month, CARB released a Draft Checklist providing guidance for companies preparing their first reports. The publication outlined an exemption for subsidiary companies from the reporting requirements, if the subsidiary’s parent company issues a report on its behalf.  In addition, CARB clarified that companies may follow one of several reporting frameworks when making the required disclosures, including the recommendations of the Task Force on Climate-Related Financial Disclosure (TCFD), the International Sustainability Standards Board’s (ISSB) IFRS S2 climate reporting standard, in addition to any framework provided by a regulated exchange or national government.  Read the Climate Related Financial Risk Disclosures: Draft Checklist

California’s disclosure regime moves ahead even as the SEC’s climate disclosure rule remains stalled in litigation, as we previously discussed.