Rules governing how shareholders in publicly-traded companies can bring corporate proposals would be scrapped under a new measure issued by the US Securities and Exchange Commission. The proposal, which would overturn decades of corporate governance practices, was released by the regulator Wednesday. The agency is also proposing to overhaul the proxy solicitation process by eliminating the so-called glossy report, separate from the proxy statement and annual 10-K reports filed with the SEC.

SEC Chairman Paul Atkins has long criticized shareholders he claims have weaponized the proxy mechanism to push climate or social equity agendas. New York State Comptroller Thomas Di Napoli criticized the proposal, saying the SEC chose to allow corporate management to shield themselves from accountability. Atkins said the proposed rescission would not eliminate shareholder proposals or silence shareholders. The SEC said states where companies are incorporated would set the rules. Texas introduced laws in 2025 requiring proxy proposers to hold at least $1 million in shares or 3% of voting stock.

The US Chamber of Commerce called the changes a “long-term solution” to activist investors. Frank Zarb of Proskauer Rose in Washington said the proposals aim to make public companies more attractive. The SEC will take public comment for 60 days. Final rules must be voted on by the commission and typically take 12 to 18 months.