Securities and Exchange Commission (SEC) Chairman Paul Atkins said the agency may continue suspending most no-action letters for shareholder proposal disputes beyond the current proxy season. Speaking on July 9 at the Society for Corporate Governance National Conference in Nashville, Tennessee, Atkins said the policy change caused fewer disruptions than many observers had predicted.

Rule 14a-8 is the SEC rule governing when eligible shareholders may place proposals on a company's proxy ballot and when companies may exclude them. Companies have traditionally requested no-action letters asking whether the SEC would object if the company omitted a shareholder proposal from the ballot. The letters indicate the SEC's view on whether a proposal may be excluded, but they are not legally binding. 

The SEC's Division of Corporation Finance stopped responding to most no-action requests in November 2025 for the current proxy season, which runs from Oct. 1, 2025, through Sept. 30, 2026. Companies have instead had to determine whether proposals qualify for exclusion without receiving an SEC response. 

Atkins said, "Nearly eight months later, it is clear that neither of these dire predictions materialized," referring to concerns that companies would broadly exclude shareholder proposals or that litigation would increase dramatically. He added that it would be difficult to direct SEC staff "to return to a tedious, and evidently ineffectual, task" when other agency work remains unfinished.

Atkins' comments are the clearest indication that the SEC may permanently step back from providing informal guidance on whether companies can exclude shareholder proposals. Instead, companies and shareholders would continue to rely on negotiations, previous SEC guidance, and litigation when they disagree over whether a proposal belongs on a proxy ballot. 

Many shareholder proposals filed under Rule 14a–8 involve environmental, social, and governance (ESG) issues. Continuing the policy would allow companies to keep excluding some proposals without first seeking a no-action letter from the SEC.

The Division of Corporation Finance announced the suspension in November 2025, citing staff resource constraints and the guidance already available from previous proxy seasons. The SEC said the policy would apply only to the 2025–26 proxy season while it evaluated the process.

On March 19, 2026, the Interfaith Center on Corporate Responsibility, an investor coalition focused on corporate social responsibility, and As You Sow, a shareholder advocacy nonprofit, sued the SEC in the U.S. District Court for the District of Columbia. The groups said the agency changed how Rule 14a-8 operates without following the Administrative Procedure Act's  rulemaking requirements. The lawsuit remains pending as Atkins indicates the SEC may continue the policy beyond the current proxy season.

Ballotpedia tracks support for and opposition to the environmental, social, and corporate governance (ESG) investing movement. To learn more about arguments for, against, and about ESG, click here. For more information on reform proposals related to ESG policy, click here.