The 2025 proxy season is just past its peak. We summarize below key emerging trends in shareholder proposals and no-action requests so far this season. A more comprehensive review of the 2025 proxy season will need to wait until all voting results are in. However, the trends so far may be instructive to boards as they consider engagement strategies for the coming year.
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On June 4, 2025, the U.S. Securities and Exchange Commission (the “SEC”) issued a concept release soliciting public comment on the definition of foreign private issuer (“FPI”), particularly on whether the current definition should be amended in an effort to protect U.S. investors while continuing to facilitate capital formation. The SEC is focused on the significant changes in the global capital markets and characteristics of foreign private issuers since the last SEC review of the FPI regulatory framework in 2008.
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In today’s corporate governance landscape, clawback and malus provisions have become key tools for promoting accountability and integrity. By incorporating these provisions, companies aim to align executive actions with the long-term interests of the company and its shareholders.
A “clawback” or “malus” provision enables a company to recover previously paid compensation (either by requiring repayment or reducing future compensation) or trigger forfeiture of unpaid compensation if it is found that the grant or payment of such compensation was based on erroneous financial data or if the recipient engaged in misconduct. For example, if a bonus was paid based on financial results that were subsequently restated, the company could invoke a clawback provision to recover the bonus (or the portion that exceeds the amount that would have been paid had the correct financial results been known when the bonus was paid). The specific conditions under which clawback and/or malus provisions apply depend on local regulatory requirements and company-specific policies, as further discussed.
This article compares adoption of clawback and malus provisions by companies the securities of which are listed in the United States and Brazilian markets and the rules and outlook for these provisions in each jurisdiction.
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In this episode of Mayer Brown’s Global Corporate M&A podcast, Mayer Brown partners Andrew Noreuil and Brian Massengill discuss this year’s amendments to the Delaware General Corporation Law, which have fundamentally altered the landscape for conflicted transactions. Our partners provide insight into the new statutory safe harbors, updated definitions for controlling stockholders and disinterested directors, and offer practical guidance for boards seeking to minimize litigation risk and secure safe harbor protection under the revised law. The discussion highlights how these landmark changes respond to recent court decisions and shifting corporate trends, marking one of the most significant updates to Delaware corporate law in decades.
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Delaware has overhauled its framework for stockholder books and records inspection rights. Amendments to Delaware General Corporation Law (DGCL) §220, enacted on March 25, 2025, seek to address the concern that inspection rights had become overly burdensome for corporations. Amended §220 generally narrows the scope of records available for inspection to a limited set of materials, while leaving open a path for stockholders to obtain additional records under certain circumstances. Amended §220 also offers some litigation advantages to corporations in defending against suits to compel inspection.
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As we previously addressed here, on February 12, 2025, the Staff of the U.S. Securities and Exchange Commission’s Division of Corporation Finance published Staff Legal Bulletin 14M (“SLB 14M”). Among other things, SLB 14M rescinded previous Staff guidance on no-action requests, pursuant to which a company can attempt to exclude a shareholder proposal from consideration in its definitive proxy statement. SLB 14M also clarified the Staff’s views on the scope and application of the “economic relevance exclusion” pursuant to Rule 14a-8(i)(5) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the “ordinary business exclusion” pursuant to Exchange Act Rule 14a-8(i)(7). We previously stated our belief that the Staff’s updated guidance would make it more challenging for proponents of shareholder proposals to overcome no-action requests based on broad social policy concerns, a prediction which only somewhat seems to have come to fruition during the 2025 proxy season to date.
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In this episode, Robyn Bew, EY Americas Center for Board Matters Director, shares insights from the EY Americas Board Priorities 2025 report. Robyn discusses how corporate boards’ priorities have evolved year-over-year, including oversight of management’s response to volatile economic conditions and capital allocation strategies. Our guest also talks about directors’ increased focus on innovation and evolving technologies, such as AI, one of several key areas where board members reported they want to spend more time and receive additional information from management.
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Shannon Nash, a chief financial officer, public company board director, investor, qualified financial expert, attorney and CPA with over 25 years of experience, is also a documentary film director. Shannon produced the documentary OnBoard, which is the story of the first African American woman to serve on a public company board. In this MB Sounding Board episode, Shannon discusses the documentary, lessons learned in telling this important story, and the continued importance of talented directors.
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Watch the trailer for OnBoard.
On April 25, 2025, the staff (the “Staff”) of the U.S. Securities and Exchange Commission’s Division of Corporation Finance (the “Division”) announced several new, withdrawn or revised Compliance and Disclosure Interpretations, all relating to Exchange Act Rule 10b5-1, covering trading “on the basis of” material nonpublic information as it relates to insider trading. In all, the Staff revised or withdrew 23 CDIs and issued two new CDIs. The majority of these changes were non-substantive, generally to ensure that the CDIs correctly and completely addressed current Rule 10b5-1 requirements, following its amendment in 2022.
The Staff made identical changes to the CDIs below, clarifying that Rule 10b5-1 applies to the scenario detailed in each CDI at “a time when [the individual in question] is not aware of material nonpublic information and satisfies all applicable conditions of Rule 10b5-1(c)(1)(ii),” (emphasis added). Among other things, these conditions include that the plan or contract to purchase or sell securities was entered into in good faith, that the person who entered into the contract or plan has acted in good faith with respect to the contract or plan, and that such person will abide by a cooling off period between entering into the plan and completing transactions thereunder.
| 120.03 | 120.04 | 120.05 | 120.06 | 120.07 |
| 120.08 | 120.09 | 120.10 | 120.11 |
The Staff also revised or withdrew, as applicable, the following CDIs to reflect the 2022 rule amendments:
| CDI | Revisions |
| 120.01 | Updated to reflect Rule 10b5-1(c)(ii)(B) cooling off periods. |
| 120.02 | Withdrawn; beginning in April 2023, Form 144 filers were required to check a box indicating that a reported transaction was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c). |
| 120.12 | Updated to reflect that, when a written trading plan does not specify the dates when a non-discretionary limit order will be in force, the conditions of Rule 10b5-1(c)(1)(ii) apply when an individual instructs a broker to place a non-discretionary limit order. |
| 120.15 | Clarifies that a market order to sell securities outside of a written trading plan would not affect the availability of the written trading plan defense for sales under the written trading plan; however, the market order would not be an additional contract or plan that would qualify for the affirmative defense under Rule 10b5-1(c)(1) for purchases or sales of the issuer’s securities on the open market under Rule 10b5-1(c)(1)(ii)(D). |
| 120.16 | Reflects codification of Rule 10b5-1(c)(i)(iv), providing, in part, that modifications to the amount, price, or timing of the purchase or sale of the securities underlying a Rule 10b5-1 plan is a termination of the plan and the adoption of a new plan. Similarly, the Staff withdrew CDI 120.19, which stated, in part, that the cancellation of one or more plan transactions would be a modification of the plan, which would terminate that plan, now codified under Rule 10b5-1(c)(i)(iv). |
| 120.18 | Clarified that termination of a plan or cancellation of plan transactions could affect the availability of the Rule 10b5-1(c) defense for prior plan transactions if it calls into question whether the plan was “entered into in good faith and not as part of a plan or scheme to evade” the insider trading rules and whether the person who entered into the plan has acted in good faith with respect to the plan within the meaning of Rule 10b5-1(c)(1)(ii)(A), in accordance with amendments (emphasis added). |
| 120.21, 120.22, 120.23 | All revised to reflect the impact of the amendments on certain transactions in an employee’s 401(k) plan, where the 401(k) plan allows employees to transfer the assets in their accounts among funds within the plan (including the employer stock fund) through fund-switching transactions. |
| 220.01 | Withdrawn; guidance regarding transfers of plan transactions to a different broker is codified in Rule 10b-5(c)(1)(iv). |
In a few of these CDIs, the Staff also updated references to the correct section of Rule 10b5-1. The Staff updated rule references only in CDIs 120.14, 120.24 and 220.02.
The Staff also adopted two new CDIs. CDI 120.32 applies when a company sponsors a 401(k) plan that permits both employer and employee contributions to be invested through a self-directed “brokerage window.” The counterparty to the self-directed “brokerage window” transaction will be an open market participant, so instructions for such a “brokerage window” transaction must satisfy all conditions of Rule 10b5-1(c)(1), including those applicable to purchases and sales of the issuer’s securities on the open market.
The second new CDI, 120.33, states, as background, that Rule 10b5-1(c)(1)(ii)(D)(3) provides an exception to the general requirement that an individual may not have multiple Rule 10b5-1 trading plans for open market transactions. This exception applies only to eligible sell-to-cover transactions, or contracts or plans covering the sale of securities to satisfy tax withholding obligations arising from the vesting of a compensatory award, where the insider does not exercise control over the timing of such sales. In the new CDI, the Staff defined “necessary to satisfy tax withholding obligations” as referring to “tax withholding payments that are calculated in good faith to satisfy the employee or director’s expected effective tax obligation solely with respect to the vesting transaction, consistent with applicable tax law and accounting rules.”
Find the updated Exchange Act Rules CDIs here.
A significant revision to the Delaware General Corporation Law has changed how corporations approve transactions with their directors, officers, and controlling stockholders. The amendments include “safe harbor” protection from certain equitable and monetary claims for qualifying transactions. This Legal Update offers a step-by-step guide for boards evaluating transactions under this new framework.
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