SEC Shareholder Rights Announcement Will Harm Both Investors and Issuers

BOSTON—The U.S. Securities and Exchange Commission’s recent decision to stop providing guidance to companies on whether they can legally exclude shareholder proposals from their proxy materials will harm both investors and issues, Ceres said in a statement today. 

Steven M. Rothstein, Ceres’ Chief Program Officer, added:  

“The practice of filing shareholder proposals has been in place for decades, as has the SEC’s role in mediating companies’ requests to exclude proposals. Nonbinding shareholder proposals have led to the broad adoption of corporate governance best practices and risk mitigation policies, which are essential for long-term value creation. The decision by the SEC’s Division of Corporation Finance not to respond to certain no-action requests in the 2025-2026 U.S. proxy season will hurt investors and issuers. This abdication by the SEC of its longstanding role as neutral arbiter of shareholder proposals will serve no one. As Commissioner Caroline Crenshaw said in her statement, this announcement is the 'latest in a parade of actions by this Commission that will ring the death knell for corporate governance and shareholder democracy.’”

Last week, Ceres joined several investor organizations in requesting a meeting with SEC Chair Paul Atkins to express their serious concerns related to his recent public remarks regarding the SEC’s role in the shareholder proposal process.  

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About Ceres 

Ceres is a nonprofit advocacy organization working to accelerate the transition to a cleaner, more just, and resilient economy. With data-driven research and expert analysis, we inspire investors and companies to act on the world's sustainability challenges and advocate for market and policy solutions. Together, our efforts transform industries, unlock new business opportunities, and foster innovation and job growth – proving that sustainability is the bottom line. For more information, visit ceres.org.