The SEC Division of Corporate Finance recently made an announcement indicating a change in its approach to requests for no action relief for the 2026 proxy season. Prior to this change companies were able to request “no action relief” from the SEC, a process in which a company can ask the SEC to allow them to leave a shareholder proposal off its proxy based on existing SEC rules. Historically the SEC would evaluate the merits of a company’s request and determine whether to allow a proposal to be excluded from a proxy. However, the recent announcement will allow companies to exclude proposals unilaterally, no longer needing to request or provide a reason to the SEC.
Investors view this change as deeply problematic and one-sided. We value the role the SEC historically has played as an objective assessor of no action relief requests. Friends Fiduciary plans to continue utilizing tools available to shareholders, including filing proposals, to raise investor concerns. We urge companies to continue to engage in dialogue regarding proposals which would provide investors with a welcome reassurance of sound corporate governance and support investor trust.