SEC Chairman Atkins Speaks on Steps SEC is Taking to Encourage IPOs

On February 23, Paul Atkins, Chairman of the Securities and Exchange Commission (SEC), spoke at a program hosted at the U.S. Chamber of Commerce Center for Capital Markets Competitiveness. Noting that the number of public companies listed on U.S. exchanges has fallen by roughly 40 percent since the mid-1990s, Chairman Atkins indicated the SEC would take steps to reverse that trend by “first, re-anchoring disclosures in materiality so that investment decisions can turn on economic signals rather than on regulatory noise; second, de-politicizing shareholder meetings by restoring their focus to significant corporate matters; and third, allowing public companies to have litigation alternatives so that we shield innovators from the frivolous and investors from the fraudulent.” He went on to cite two bills pending in Congress — the INVEST Act and the Empowering Main Street in America Act — “as a welcome complement” to the work of the SEC. He observed that the proposed legislation would codify or expand practices that, in his view, have proven their worth and extend their benefits more broadly. In particular, “allowing all companies to ‘test-the-waters’ before their IPO could incentivize more firms to explore going public. A modernized accredited investor definition, meanwhile, such as a knowledge-based exam, would recognize that financial sophistication can scarcely be measured by income or net worth alone.”

On February 17, the SEC’s Division of Corporation Finance announced the release of a series of new Compliance and Disclosure Interpretations (C&DIs), continuing a recent trend of issuing new and updated public guidance. This set of C&DIs is centered on Regulation A and Regulation Crowdfunding. For companies considering exempt offerings, these interpretations have implications for offering timing, capital structure design, marketing strategy and ongoing reporting obligations. In particular, these updates reflect continued SEC focus on operational precision in exempt offerings. While the guidance expands flexibility in certain areas — particularly draft review and offering structuring — it reinforces strict compliance boundaries around timing, offering cap calculations and acceptance of investor funds. Please see the PCAP blog entry referenced below for more detailed discussion of the updated guidance.

On February 17, at the Texas A&M School of Law Corporate Law Symposium, Chairman Atkins delivered a speech centered on two themes: competition among the states for corporate incorporations and the SEC’s drive to reform current SEC disclosure requirements. Speaking in Texas, he highlighted that state’s efforts to compete with Delaware, noting that new Texas statutes provide that litigants will no longer be able to recover their fees from a company in actions that result solely in “additional or amended disclosures…regardless of materiality” and provide Texas companies with more control over the venue and method of adjudicating lawsuits. In Chairman Atkins’ view, “Texas’s recent amendments to its corporate laws reflect the idea that competition amongst States for domiciling corporations is a healthy function of our capital markets.” He went on to highlight the SEC’s priorities in undertaking disclosure reform: rationalizing disclosure to calibrate the level of disclosure with the cost of doing so; simplification so disclosure is more straightforward for investors to understand; and modernization to reflect the current environment — specifically, for example, addressing whether executive security protection should be considered to be a perquisite for the purposes of the SEC’s executive compensation disclosure requirements.

On February 24, the staff of the SEC’s Division of Enforcement announced significant updates to its Enforcement Manual. The Enforcement Manual is a reference for staff in the Division of Enforcement as they investigate potential violations of federal securities laws. It contains general policies and procedures and is intended to provide guidance only to the staff of the Division of Enforcement in the exercise of its responsibilities in conducting enforcement activities. It does not constitute a rule, regulation of statement of the SEC. That said, it is helpful to practitioners in the area to understand the processes used by and key considerations for the Division of Enforcement. In the press release announcing the update, the Division of Enforcement highlights three areas:

• Ensuring a uniform Wells process: Setting forth clearer processes and timelines that are intended to ensure that the Division of Enforcement acts promptly while allowing parties affected by an enforcement investigation to learn more quickly whether the staff will recommend closure of an investigation or an enforcement action, as well as help ensure efficient use of resources.
• Facilitating simultaneous consideration of settlement recommendations and waiver requests: reflects that the SEC recently restored its prior practice of permitting a settling party to request that the SEC simultaneously consider an offer of settlement and any related request for an SEC waiver from automatic disqualifications and other collateral consequences that result from the underlying enforcement action.
• Cooperation: includes details on the framework for evaluating cooperation, including the impact of cooperation on civil penalties.

On February 13, James Moloney, Director of the SEC’s Division of Corporation Finance (the Division), delivered a detailed statement on “coming attractions” from the Division as it pursues rulemaking to “reduce barriers to going public, rationalize burdensome requirements while ensuring that investors continue to have access to the material information they need, and simplify and modernize [the SEC's] rules so that more companies are willing to go and stay public.” Key topic areas for which the SEC is seeking input from investors, companies and other constituents include:

• Amendments to Regulation S-K: the Division has requested public comments on revising every part of Regulation S-K, including executive compensation disclosure. It seeks targeted, concrete recommendations to reduce immaterial disclosure and encourage companies to focus on the information that is material to investors.
• Semi-Annual Reporting: With President Trump advocating for reconsideration of mandatory quarterly reporting, the Division is working on developing a recommendation for Commission approval, with Mr. Moloney noting that it is unlikely to be a one-size-fits all approach. Mr. Moloney requests input from a broad range of market participants on the best way to structure the final rule.
• Foreign Private Issuers (FPIs): As part of the 2026 National Defense Authorization Act, Congress passed the Holding Foreign Insiders Accountable Act (HFIAA). The HFIAA subjects the directors and officers of reporting FPIs to the SEC’s insider transaction reporting regime and mandates that the SEC implement any necessary rule changes by March 18. The Division is considering whether certain exemptions may be appropriate. The Division is also reviewing public comment on its June 2025 Concept Release on Foreign Private Issuer Eligibility, which may lead to rules changing the FPI regime more broadly.
• Shareholder Proposals: Mr. Moloney notes that a rulemaking to modernize Rule 14a-8 is on the SEC’s agenda, and the Division is in the process of preparing its recommendations. In the meantime, it is carefully observing the current proxy season in light of the move away form issuing no action letters on requests to exclude Rule 14a-8 shareholder proposals.

On March 9, the SEC will host the agency’s 45th Annual Government Business Forum on Small Business Capital Formation. Registration information and an agenda are available on the event page. The event will feature appearances by SEC Commissioners and discussions with thought leaders from across the small business ecosystem on capital raising by early- to late-stage private companies and smaller public companies. Both in-person and online participants will have the opportunity to submit policy recommendations in advance by emailing smallbusiness@sec.gov by noon ET on March 5.