2026 United States Proxy Season Preview: Governance & Compensation

The full report is available to institutional subscribers by logging into ProxyExchange then selecting the Knowledge Center and its Library tab and to corporate subscribers by logging into Compass then selecting Governance and the Governance Library or Governance Exchange tab.

• SEC actions expected to have significant impact on proxy voting and stewardship. The SEC has decided not to issue “no action” determinations in most cases, but will instead leave it to companies and their lawyers to determine whether a shareholder proposal can be properly excluded under Rule 14a-8. The Commission has also announced that it will “object to” the voluntary filing of notices of exempt solicitation, which have been the primary means of communicating support for or opposition to a proposal on the ballot. The SEC is also preparing to announce major changes to disclosure and financial reporting requirements, though these are unlikely to impact 2026 proxy season.
• Interstate battle for incorporations continues. The number of reincorporation proposals at U.S. companies more than doubled from 2024 to 2025. The key question for 2026 is whether recent Delaware court rulings and statutory changes convince Delaware companies to stay put, or whether other states continue to gain ground and push Delaware to further weaken shareholder protections.
• Significant U.S. Compensation Benchmark policy updates for 2026. ISS has updated the approach to evaluating the mix of long-term equity, with time-based equity that utilizes a sufficiently long-term time horizon now viewed positively. Additionally, the time horizon for certain pay-for-performance quantitative screens has been extended, and new features and overriding factors have been added to the Equity Plan Scorecard models.
• SEC considering executive compensation disclosure requirement changes. The SEC has been critical of the costs and complexity of proxy disclosure compared to the benefits for investors, with the CEO pay ratio and pay versus performance disclosures being specifically cited. The mandated disclosure of executive security perquisites has also drawn interest, and the SEC is reconsidering their classification as a perquisite and raising the current perquisite materiality thresholds. Such changes will not be in effect for the upcoming proxy season, though proposed rules could be released by year end.
• Transition-related payments are expected to be a focus in the 2026 proxy season. Following an unprecedented number of CEO turnovers in 2025, transition-related pay issues, including severance payments, sign-on bonuses, and make-whole awards, are expected to play a prominent role in executive compensation disclosures this year.

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