SEC Eyes Investor Proposal Change, ‘Material’ Reporting Rule (1)

The SEC is looking to update shareholder proposal rules to ease “compliance burdens” and help companies choose what is considered “material” to disclose to investors, according to a new agenda.

The Securities and Exchange Commission, under Republican control, is considering releasing plans for “Shareholder Proposal Modernization” and “Rationalization of Disclosure Practices” by April 2026, according to the agency’s latest semiannual rulemaking list viewed Friday on an Office of Information and Regulatory Affairs website.

The new regulatory agenda, briefly posted on the OIRA website, is the first in President Donald Trump’s second term. The site was under maintenance as of mid-morning Friday.

The SEC agenda, viewed by Bloomberg Law before the site’s maintenance, had more than 20 rulemaking items in all, including proposals on crypto trading and private offerings, as well as the shareholder proposal and material reporting plans.

An agency spokesperson didn’t immediately respond to a request for comment.

• The proposed changes for rules governing proposals that shareholders bring at companies’ annual meetings would “reduce compliance burdens” for businesses, the agenda said.
• The planned reporting rule would “rationalize disclosure practices to facilitate material disclosure by companies and shareholders’ access to that information,” according to the agenda. A company must make disclosures deemed important to a reasonable investor under the SEC’s materiality standard.
• Companies have long pushed the SEC to ease their efforts to block votes on shareholder proposals and provide more flexibility on environmental, social, and governance disclosures and other reporting.