1. SEC leadership has signaled a major modernization push – with more than 22 rulemaking actions on the Regulatory Flexibility Agenda aimed at updating decades-old disclosure and governance frameworks for modern markets and technology.
2. There’s an emphasis on practical experience over purely academic rulemaking – Jim explained that his 26 years in private practice shaped his view that SEC rules must work in real-world business settings, not just on paper.
3. Corp Fin was described as the SEC’s disclosure “compliance engine” – reviewing 10-Ks, 10-Qs, proxy statements, IPO filings, merger filings, and issuing comments, no-action relief, exemptive orders and interpretive guidance.
4. SEC leadership has previewed a sweeping “spring cleaning” of Regulation S-K – arguing that disclosure requirements have expanded from a slim rulebook decades ago into a five-volume system layered with excessive and repetitive mandates.
5. A centerpiece reform under discussion is voluntary semiannual reporting – which would allow eligible companies to file one 10-Q and one 10-K annually instead of the traditional three quarterly reports plus an annual report (which was proposed by the SEC a few weeks ago as noted in this blog).
6. The SEC framed semiannual reporting as a capital formation initiative – particularly for IPO-stage, life sciences and smaller companies that could benefit from spending more time building their businesses rather than continuously preparing disclosure filings.
7. Semiannual reporting would likely remain optional – allowing investors and issuers to choose the disclosure cadence that best fits their industry, maturity and investor expectations.
8. Repeated criticism of “disclosure overload” – arguing that excessive disclosure can obscure truly material information and create “white noise” that burdens companies while confusing investors.
9. Executive compensation and risk factor disclosures were highlighted as examples of regulatory bloat – with disclosure sections expanding from a few pages decades ago into sprawling multi-page narratives and repetitive summaries that may no longer enhance investor understanding.
10. Emphasis on a return to transparency and interpretive engagement – reviving no-action letters, exemptive orders, and disclosure interpretations so market participants can receive clearer guidance on how to comply with securities laws.

The post Corp Fin Director Jim Moloney Discusses the Latest appeared first on The Governance Beat.

Last year, the SEC voted to stop defending the rule against court challenges, as noted in this recent blog that recaps the rule’s legal journey since adoption. 

The basis for the recission is that they were beyond the scope of the agency’s authority. But as noted in the press release, even if it had statutory authority, this Commission believes there are these independent, compelling policy reasons to rescind them entirely:

1. They are unnecessary and inconsistent with a registrant-specific, materiality-based approach to disclosure that best serves the interests of registrants and investors.
2. They stray well beyond the policy concerns of the federal securities laws.
3. They impose substantial costs on public companies and their shareholders that are not justified by the informational benefits they may provide to some investors.
4. They are at odds with the Commission’s policy objectives of facilitating capital formation and promoting public company status.

The comment period is 60 days…

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“According to the SEC, the percentage of issuers entitled to scaled disclosure relief would increase from 44% to 81% of registrants. The ability to rely on the scaled compensation disclosure is a significant advantage. Among other things, there is no requirement for a Compensation Discussion & Analysis or CEO pay ratio disclosure, disclosure is generally required for only three executives (not five) and for only two years (not three) of historical compensation, and certain compensation tables (such as the grants of plan-based awards table, pension benefits, option exercises, and stock-vested and nonqualified deferred compensation tables) may be omitted.

Perhaps more importantly, NAFs would be entitled to the compensation-related accommodations presently afforded to emerging growth companies. That relief would exempt NAFs from the requirement to hold shareholder advisory votes on executive compensation (“say on pay”), the frequency of say-on-pay votes, golden parachute compensation in connection with mergers and acquisitions, and the “pay versus performance” disclosure under Regulation S-K 402(v).

It is worth noting that this relief being proposed by the SEC aligns closely with comments offered by Cooley as part of the SEC’s ongoing review of executive compensation disclosure requirements initiated at its roundtable on June 26, 2025 – one of the few comment letters focused primarily on the reporting burdens shouldered by smaller companies.”

The post SEC Proposes Sea Change in Compensation Disclosure Rules (For All But Largest Issuers) appeared first on The Governance Beat.

Here are some themes from the speech:

1.  IPO Process Overhaul Under Consideration Including “Gun-Jumping” — The SEC is reviewing modernization of the IPO process itself, particularly outdated “gun-jumping” communication rules under the Securities Act. The Chairman argues current rules are overly complex and poorly adapted to modern communications technology.

2. Openness to Alternative Paths to Public Markets — The speech encourages innovation beyond traditional underwritten IPOs, including SPACs and direct listings. The Chairman suggests regulators should remove unnecessary barriers to alternative public market entry methods rather than forcing companies into workaround structures.

3.  Direct Listings May Be Revisited — The Chairman specifically questions whether Securities Act registration requirements for direct listings still provide meaningful investor protection after a 2023 Supreme Court ruling – Slack Techs v. Pirani – that made Section 11 claims harder in certain direct listing contexts. He suggests the SEC may revisit these rules.

The post SEC Solicits Comments to Boldly Modernize the IPO Process appeared first on The Governance Beat.

“On March 26, 2026, President Donald Trump issued Executive Order No. 14398 (EO) targeting DEI activities by federal contractors and subcontractors. The EO, titled “Addressing DEI Discrimination by Federal Contractors,” highlights the administration’s belief that some entities, including federal contractors, continue their discriminatory practices through “diversity, equity, and inclusion” (DEI) activities that are sometimes concealed from public view.

To address this, the EO requires federal departments and agencies to add a new, DEI-specific clause to contracts and “contract-like instruments” through which contractors and subcontractors would pledge not to “engage in any racially discriminatory DEI activities” and would agree to “furnish all information and reports, including providing access to books, records, and accounts, as required by the contracting agency … for purposes of ascertaining compliance with [the new] clause.”

Notably, the EO focuses only on “racially discriminatory DEI,” or disparate treatment based only on race and ethnicity, and it does not include other categories protected under federal law, such as sex or gender, which is a departure from the administration’s January 21, 2025, Executive Order No. 14173, which was broader than race-based DEI. However, the EO’s narrowed approach is consistent with the General Services Administration’s recently proposed DEI certification requirement (GSA requirement) for federal financial assistance recipients, which directs recipients to certify compliance with laws prohibiting race and color discrimination, but notably omits sex and other protected categories.

While ethnicity and color are two legally distinct protected characteristics, the EO and GSA requirement interestingly take differing approaches on whether to cover each such characteristic, while both address race.

On April 20, 2026, in Nat’l Ass’n of Diversity Officers in Higher Educ. v. Trump, No. 8:26-cv-01532, (D. Md. filed Apr. 20, 2026), five organizations composed of membership organizations and nonprofit trade associations challenged the EO in the US District Court for the District of Maryland. Among other things, the complaint alleges that the EO’s requirement that federal contractors certify that they will not engage in “racially discriminatory DEI activities,” regardless of whether those activities comply with federal antidiscrimination law or are discriminatory, violates the First Amendment.

The plaintiffs seek an injunction enjoining enforcement and implementation of the EO, striking any contract language implementing the EO that has been inserted into any federal contract or contract-like instrument, and rescinding any agency implementation directives relating to the EO. While employers should track this and any other legal challenge to the EO, they should continue to prepare to comply with the order until a court rules otherwise.”

The post Executive Order Targets Federal Contractors’ ‘Racially Discriminatory DEI Activities’ appeared first on The Governance Beat.

Open questions and areas for comment

The proposal raises several interpretive and policy questions on which the SEC has invited comment, and that may attract significant attention from practitioners and issuers, including:

• Whether the proposed $2 billion LAF threshold and the two-year and 60-month eligibility criteria are appropriately calibrated.
• Whether there should be a mechanism for automatically adjusting the $2 billion LAF threshold, and, if so, what the mechanism should be.
• How the transition framework should operate for companies currently occupying intermediate categories, including AFs.
• Whether the broad extension of scaled disclosures to NAFs is appropriate given the simultaneous elimination of the SRC category.
• Whether further conforming amendments are warranted with respect to foreign private issuers.
• Whether to add an accommodation for special purpose acquisition companies (SPACs) that would permit a new seasoning period to begin when a business combination between a SPAC and a private operating company occurs.
• The appropriate boundary conditions and measurement dates for the SNF subcategory.
• How NAFs should practically implement the expanded material unresolved staff comment disclosure obligation.

The post SEC Proposes Simplified Filer Status Rules and Expanded Disclosure Accommodations appeared first on The Governance Beat.

Here are five things to know:

1. Expanded Form S-3 Eligibility – The SEC’s proposed reforms would significantly broaden access to Form S-3, allowing more public companies to conduct shelf offerings and access capital markets more quickly.
   
   The proposal removes the current 12-month Exchange Act reporting requirement and eliminates the $75 million public float threshold for unlimited offerings- while still requiring timely SEC reporting and excluding certain “ineligible issuers.”
   
   
2. Modernization of Form S-1 Incorporation by Reference – The proposal would expand both backward and forward incorporation by reference on Form S-1. Issuers would no longer need to have filed their latest annual report to backward incorporate – and forward incorporation would no longer be limited to smaller reporting companies (SRCs).
   
3. Broader Access to WKSI-Style Benefits – The proposal would extend many registration and communication advantages currently reserved for “well-known seasoned issuers” (WKSIs) to a much larger group of issuers.
   
   Companies eligible to use Form S-3 and listed on a national exchange could access most WKSI benefits – even without the current $700 million public float or $1 billion debt issuance thresholds.
   
4. Federal Preemption of State Blue Sky Requirements – The proposal would preempt state securities registration and qualification requirements for all registered offerings, including offerings of unlisted securities. This change is intended to reduce compliance costs and streamline the registered capital raising process across multiple states.
   
5. Expanded Flexibility for BDCs and Closed-End Funds – The proposal would to extend short-form shelf registration eligibility and certain communication benefits to more business development companies (BDCs) and registered closed-end funds by easing seasoning and public float requirements.

The post The SEC Proposes to Ease Form S-3 Eligibility & More: Five Things appeared first on The Governance Beat.

Here are six things to know:

1. Most Companies Would Get Expanded Disclosure Relief: The proposal would extend many existing accommodations currently reserved for smaller reporting companies and emerging growth companies to nearly all non-accelerated filers. These include:

• Reduced executive compensation disclosures
• No pay-versus-performance disclosure
• No say-on-pay or say-when-on-pay votes
• Fewer years of audited financial statements required

2. Big Increase to Large Accelerated Filer Threshold: The SEC proposes raising the large accelerated filer public float threshold from $700 million to $2 billion. Companies would also need:

• Two consecutive years above the threshold
• At least 60 months as a reporting company before qualifying

3. Accelerated Filer and SRC Categories Would Disappear: The proposal would eliminate the “accelerated filer” and “smaller reporting company” categories entirely. Companies would instead fall into only two main categories:

• Large Accelerated Filers
• Non-Accelerated Filers

4. Most Public Companies Would Become Non-Accelerated Filers: If adopted today:

• Only about 19% of public companies would qualify as large accelerated filers
• About 81% would become non-accelerated filers

5. Smaller Companies Would Receive Extra Filing Time: A new subgroup called “Small Non-Accelerated Filers” would be created for companies with assets of $35 million or less for the prior two years. These companies would receive an extra 30 days for Form 10-K filings – and an extra 5 days for Form 10-Q filings.

6. Auditor Attestation Requirements Would Narrow Significantly: Non-accelerated filers would no longer need an auditor attestation on internal controls under Section 404(b) of Sarbanes-Oxley. This obligation would primarily remain for large accelerated filers.

The Annex of the fact sheet shows off the proposed new filing structure nicely, copied below:

The post The SEC Proposes Simplified Disclosure for Most Companies: Six Things appeared first on The Governance Beat.

Here are the reports:

1. BlackRock Investment Stewardship 2025 Annual Report
2. BlackRock Active Investment Stewardship 2025 Annual Report
3. BlackRock Climate and Decarbonization Stewardship 2025 Annual Report
4. Vanguard Investment Stewardship 2025 Annual Report
5. State Street Stewardship 2025 Annual Report  
6. J.P. Asset Management 2025 Annual Report

The post The “Big 3” Institutional Investors Publish Their 2025 Stewardship Reports appeared first on The Governance Beat.

Here are four things to know:

1. The “Gag Rule” Is Longstanding and Controversial – This 54-year old policy – it started in 1972! – permits parties to settle enforcement actions without admitting allegations, while simultaneously barring them from publicly denying those allegations. Settling parties can emphasize cooperation, remediation and closure – but they can’t directly challenge the SEC’s allegations without risking the settlement itself.
   
   So the government’s side of the story essentially is the only side of the story that the public ever gets to hear. This policy has long been controversial – with some questioning its constitutional validity under the First Amendment and the “unconstitutional conditions doctrine” – and others doubt its value with a wide range of attacks, from the policy is too lenient to it’s difficult to know if the government’s allegations were true under the policy.
   
   There is a long history of unsuccessful attempts to eliminate the policy as most other federal agencies don’t have this type of enforcement policy.
   
2. If the SEC’s Policy Changes, the Entire Settlement Communications Playbook Changes – This would be a huge change as companies may suddenly have the ability to argue publicly that the SEC’s version of events was incorrect, exaggerated, misleading or not fully complete.
   
   Companies could potentially settle an SEC enforcement action while continuing to openly dispute the agency’s account of what occurred. That shift could dramatically affect communication strategies.
   
3. But Greater Freedom to Deny Also Creates Greater Risk — Being aggressive after a settlement could wind up in being a situation that’s volatile and difficult to control. Even if public denials are permissible, some might still demand answers: Why was money paid? What facts are accepted or disputed? What was fixed? And should the SEC’s findings still carry weight?
   
   In other words, there could far more conflict in the public realm once settlements are announced under the new framework. An SEC order could be the beginning of a protracted battle that plays out in the media – rather than the final word it is today.
   
4. SEC Might Still Be Able to Negotiate for “Neither Admit Nor Deny” On Case-by-Case Basis — We don’t know yet what new policy the SEC plans on adopting – and it certainly is possible that the new framework still allows for Enforcement to negotiate a “neither admit nor deny” component for settlements on a case-by-case basis. So we might not be fully done with the gag rule….

The post SEC Looking to Rescind Enforcement’s “Gag Rule”: Four Things to Know appeared first on The Governance Beat.