On November 17, 2025, the SEC announced further changes in related practices. For decades, the SEC staff served as the main referee, issuing views on when companies could omit a shareholder proposal. That system placed most of the interpretive weight on federal law, with state corporate law playing only a modest role. For the upcoming proxy season, however, the staff will weigh in only on questions that turn on state law—specifically, whether a proposal is a proper subject for shareholder action. On all other disputes, companies and shareholders will proceed without SEC staff views.

The shareholder proposal rule, a longstanding feature of the federal proxy system, has rarely intersected with state corporation law, leaving many Delaware practitioners unfamiliar with its operation or implications. Yet this new focus on the intersection between federal rule and state law implicates Delaware’s corporate franchise, an important topic that the State of Delaware has recently asked the University of Delaware’s Institute for Public Administration (IPA) to study. It is therefore timely to consider both the shareholder proposal rule and its significance in the context of Delaware’s corporate franchise.

To promote informed discussion over coming months, the Weinberg Center, in partnership with IPA, will convene a program that frames the context in terms of Delaware’s corporate franchise and then explores the shareholder proposal rule itself.

Robert E. Wright
“Delaware’s Charter Leadership and the Political Use of Shareholder Proposals,” Weinberg Center Occasional Paper Series, No. 2501 (November 2025) [PDF]

Securities and Exchange Commission
Rule 14a-8 (text)