Proposed Changes to Filer Status Rules: Goodwin Summarizes Key Themes in Public Comments on the Proposal

In May 2026, the SEC proposed amendments that would restructure the framework that public companies use to determine their SEC filer status and the related reporting and disclosure obligations that arise from that filer status. The proposal would replace the existing large accelerated filer, accelerated filer, and non-accelerated filer framework with two primary categories — large accelerated filers (LAFs) and non-accelerated filers (NAFs) — and would eliminate smaller reporting company (SRC) status as a separate category of filers. It would also substantially expand the population of companies that are eligible to utilize scaled disclosure and other accommodations that are currently available only to SRCs and emerging growth companies (EGCs).

The proposal generated substantial public comment. Last week, Goodwin’s Public Company Advisory Practice published an alert that summarizes key themes emerging from the public comments. Key areas of discussion include:

• Threshold for Determining Large Accelerated Filer Status: Commenters expressed diverging views on the proposed $2 billion public float threshold for determining LAF status. While some commenters support the proposed threshold as an appropriate recalibration of the $700 million threshold established more than two decades ago, other commenters argue that $2 billion would extend NAF accommodations to companies with sufficient size and resources to bear the costs associated with LAF status.

  Commenters proposed a range of alternatives, including retaining the existing $700 million threshold; adjusting that threshold for inflation to approximately $1.1 billion to $1.2 billion; adopting an intermediate threshold, such as $1 billion; and supplementing public float with a revenue-based measure.

• Five-Year On-Ramp for Large Accelerated Filer Status: Commenters also focused on the proposed 60-month seasoning period for achieving LAF status. Supporters of an extended on-ramp generally emphasize the benefits of reducing the costs and operational burdens associated with transitioning to public company status. Many commenters express concern with whether a five-year seasoning period is too long for all newly public companies, failing to take into account size, resources, and operating maturity.

The significance of the proposed on-ramp is amplified by the accommodations that would accompany NAF status. NAFs would no longer need to provide an auditor attestation of management’s assessment of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act. In addition, they generally would be permitted to provide two rather than three years of certain audited financial statements, scaled executive compensation disclosure, and relief from certain Regulation S-K disclosure requirements. NAFs also would be exempt from pay-versus-performance disclosure and shareholder advisory votes on executive compensation, including say-on-pay, say-on-frequency, and golden parachute compensation. Comments on the breadth of these accommodations include:

• Relief From Internal Control Over Financial Reporting Requirements: As noted above, under the proposed framework, only LAFs would be subject to the requirement to provide an auditor attestation of management’s assessment of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act.

  Commenters expressing support for the SEC’s proposal generally view the expansion of the availability of the exemption as a meaningful opportunity to reduce the costs of being a public company.

  Other commenters, including accounting firms, institutional investors, and academics, express concern that the proposal to expand the availability of the Section 404(b) exemption would extend it beyond the population of companies for which the costs of auditor attestation may outweigh its benefits. These commenters emphasize the role of independent auditor attestation in identifying material weaknesses and improving the reliability of financial reporting, and they question whether management’s assessment of internal control over financial reporting under Section 404(a), without corresponding auditor attestation, would provide investors with comparable assurance.

• Scope of Other Accommodations: Commenters also addressed the scope of accommodations that would be provided to companies that would qualify for NAF status.

  Numerous commenters emphasized the role of executive compensation disclosures and shareholder advisory votes in evaluating pay practices, assessing alignment between compensation and performance, and exercising shareholder oversight.

  Commenters supporting the accommodations stated that extending accommodations currently available to SRCs and EGCs would simplify the regulatory framework, reduce compliance costs, and allow companies to devote additional resources to their businesses.

The SEC will consider these comments in the course of the rulemaking process for these proposed amendments.

In September 2025, the SEC’s Division of Corporation Finance (the Division) issued a no-action letter in response to a request by Exxon Mobil Corporation (ExxonMobil) in which the Division said it would not recommend enforcement action under Rules 14a-4(d)(2) or 14a-4(d)(3) for a retail voting program that permits participating retail investors to provide standing voting instructions applicable to subsequent shareholder meetings. The ExxonMobil letter notes that the ExxonMobil program would be available to retail investors at no cost; participants would receive annual reminders and could cancel or override their instructions at no cost; participants would continue to receive all proxy materials and could vote using those materials; and the company would disclose the program on its website and in its proxy statements.

Last week, the Division issued two new no-actions letters addressing voting instruction plans that addressed some new facets of proposed standing voting arrangements.

On September 28, 2026, in a response to a request from The Goldman Sachs Group, Inc. (Goldman Sachs), the Division issued a no-action letter indicating that the Division would not recommend enforcement action to the Commission if Goldman Sachs proceeded with a retail voting program that incorporated the following additional elements:

• Enrollment would be permitted before a meeting-specific definitive proxy statement is furnished.
• Enrollment communications would not be required to include information about participants and their interests in a proxy solicitation.
• Tailored employee and alumni outreach, including internal-system enrollment for current employees, would be permitted.

Please see our PCAP Blog post for a discussion of the Goldman Sachs no-action letter.

Then, on September 29, 2026, the Division issued a no-action letter in response to a request from Tesla, Inc. (Tesla) indicating that the Division would not recommend enforcement action to the Commission if Tesla proceeded with its proposed issuer voluntary retail voting program. Of note, the Tesla no-action letter expressly states that the Division’s position expressed in the no-action letter applies to any issuer operating a voting plan in the same manner described in Tesla’s submission. By contrast, the ExxonMobil and Goldman Sachs letters provided no-action relief to just those two firms.

Substantively, the Tesla plan is also broader than ExxonMobil’s program by providing that:

• The voting instruction plan would be able to leverage a centralized hub administered by a shareholder communications provider (e.g., Broadridge) that could cover multiple issuers.
• Through such a hub, an investor could enroll in the voting program of more than one issuer whose shares are held in the investor’s accounts.
• An issuer could allow an investor to establish a standing instruction for a particular account without having to opt in again if the investor sells all of the issuer’s shares and subsequently reacquires them.
• An issuer could rely on householding so that an opt-in would apply to all shares across all accounts under a shareholder’s name.
• Once a hub is established and program communications are filed, retail investors could be offered the opportunity to participate when or shortly after they first become shareholders or at any later time while the program is maintained. The invitation would not be tied to an upcoming proxy solicitation.
• An issuer can choose to make its program available to all retail shareholders or only a subset of retail shareholders.

Please see our PCAP Blog post for a discussion of the Tesla no-action letter.

On October 5, the SEC, in coordination with other US and global financial regulators, issued a joint investor bulletin as part of World Investor Week (WIW). As noted in the SEC’s press release, WIW is a global effort by the International Organization of Securities Commissions to bring together regulators across six continents to raise awareness about the importance of investor education and investor protection. This year marks WIW’s 10th anniversary.

The World Investor Week 2026: Investor Bulletin provides guidelines to help individuals become “resilient investors.” This guidance is centered on the following areas:

• Preparing for Economic and Market Fluctuations – investors should take steps to make themselves more resilient by having a plan in place to help themselves achieve financial goals despite future setbacks or other changes in the economy and markets:
  • Maintaining adequate savings – in particular, having an emergency fund;
  • Diversifying across and within investment classes;
  • Engaging in patient, periodic investing (e.g., through dollar-cost averaging); and
  • Paying off high-interest debt.
• Protect Assets From Scams – resilient investors should also actively take steps to protect their assets from fraudulent activity by increasing their awareness of potential scams:
  • Beware of strangers making contact via text or social media to develop relationships before introducing a fraudulent scheme;
  • Beware of scammers who start small but increasingly demand larger amounts of money from you;
  • Beware of fraudsters who impersonate government agencies or known investment professionals; and
  • Be skeptical of communications from someone claiming to be from the SEC or other organizations asking about your shareholdings, account numbers, trading activity, PINs, passwords, or other information that might be used to access your financial accounts.

On October 2, 2026, Hester Peirce’s term as an SEC commissioner expired. Chairman Paul Atkins expressed his appreciation for Commissioner Peirce’s tenure at the SEC in remarks at an open meeting of the Commission on September 30.

With the Commission now comprised of two members, the SEC has revisited its rules addressing when a quorum is present at a meeting for the purpose of determining that the Commission has the power to act on matters before the Commission. On September 30, the SEC adopted a final rule that provides that three commissioners will continue to constitute a quorum of the Commission, with two exceptions:

• First, consistent with the current rule, if the number of commissioners in office is two or one, that number is sufficient for a quorum.
• Second, if the number of commissioners in office minus the number disqualified from consideration with respect to a matter is two or one, then that number of commissioners constitutes a quorum for the purposes of that matter.

In other words, with respect to the second item, in a situation in which only one commissioner is able to participate in a matter because all other commissioners currently in office are disqualified from participating in that matter, the remaining member would constitute a quorum for that particular matter.

On October 7, the SEC issued a rare Section 21(a) report outlining the agency’s investigation into potential violation of the Securities Exchange Act of 1934 (the Exchange Act) in connection with a 2021 activist campaign involving ExxonMobil. The report notes:

The Commission has determined not to pursue an enforcement action based on the conduct and activities known to the Commission at this time but has serious concerns about the conduct of CA100 members and other participants in these activities as described herein. The Commission in its discretion has determined to issue this report of investigation (Report) pursuant to Section 21(a) of the Exchange Act to inform those asset managers and investors who would join, or would consider joining, an organization such as CA100 to take appropriate steps to ensure compliance with the Exchange Act.

Specifically, this Report recognizes that the agreement, arrangement, understanding, or concerted action underlying the formation of a “group” may be implied and that coordinated engagement practices ̶ ̶ even when undertaken through an intermediary ̶ ̶ may implicate the beneficial ownership reporting framework. While shareholders may deny the existence of a group, such denials are not conclusive as to whether a group has formed.

Beneficial owners who do not wish to be part of a group therefore should proactively ensure policies aimed at avoiding group formation are adequately enforced. Irrespective of group formation, beneficial owners that report on Schedule 13G need to be mindful of whether their actions may be viewed as having been undertaken with the purpose or effect of changing or influencing control of a specific issuer. Membership in an organization whose stated purpose is to change or influence control of a specific issuer by promoting the election of dissident directors or otherwise could be a factor in the loss of eligibility to report on Schedule 13G instead of Schedule 13D.

As with prior Section 21(a) reports, the matters addressed by the Division of Enforcement should be carefully considered, as the report is intended to put investors on notice that their activities may be closely scrutinized by the SEC when they report their beneficial ownership as “passive investors.”

On October 7, the SEC posted notice and immediate effectiveness of a Nasdaq amendment to Listing Rule 5505, which will require a minimum $4 stock price for initial listing on the Nasdaq Capital Market. This will eliminate the alternative price standards that had permitted the listing of securities priced between $2 and $4 that were not within the Exchange Act Rule 3a51-1(g) definition of “penny stocks” as a result of meeting certain equity, net income, and/or market value of listed securities standards, along with a threshold amounts of net tangible assets and operating history. The notice states:

Nasdaq is proposing to remove Listing Rule 5505(a)(1)(B), and, as a result, require all companies seeking to list under the Initial Listing Standards to have a minimum stock price of $4.00. The $4.00 standard is consistent with the initial listing requirements of other national securities exchanges, whereas the current Alternative Price Requirement is generally lower than the minimum price required for listing on other national securities exchanges.

Because companies that originally listed under the Alternative Price Requirement remain listed, the Exchange is proposing to keep Listing Rule IM-5505-2. The rule requires Nasdaq to publish on its website a list of any company that initially listed under the Alternative Price Requirement, which no longer satisfies the net tangible assets or revenue test contained in former Rule 5505(a)(1)(B), and which does not satisfy any of the other exclusions from being a penny stock contained in Rule 3a51-1 under the Act. Nasdaq will maintain this list on its website for as long as any companies remain listed that could be subject to that condition.

The Exchange is also proposing to include a summary description of former Listing Rule 5505(a)(1)(B) within Listing Rule IM-5505-2, which describes the price requirement that companies that initially list under the Alternative Price Requirement must satisfy and Nasdaq’s ongoing monitoring of such companies for compliance with the penny stock rules. The proposed summary is intended to provide clarification for the references to the former rule that remain in Listing Rule IM-5505-2. Lastly, the Exchange is proposing to make conforming changes to Listing Rule IM-5505-2 to clarify that Listing Rule 5505(a)(1)(B) is a “former” rule.

Nasdaq intends to make the proposed rule change operative 30 days after the date of the September 30 filing date.

On October 7, ISS STOXX Governance (ISS) announced the results of its annual global benchmark policy survey. This survey is conducted as part of the annual policy development process that ISS undertakes to determine whether it should make changes to its benchmark voting polices for the 2027 proxy season.

ISS notes that it received a total of 253 responses, of which 141 were from institutional investors and investor-affiliated organizations and 112 from companies, corporate-affiliated organizations, and other non-investor respondents. The survey covered a wide range of governance-related topics, including director independence, executive compensation, periodic reporting, shareholder rights, and management of nature-related risks. Key findings of the survey include:

• On the topic of director independence in the US, 64% of investor respondents indicated that a long director tenure should be considered as a factor in assessing a director’s independence, while 74% of non-investor respondents said tenure, regardless of length, should not be a factor to consider and that a board’s determination of independence is sufficient.
• On proposals to permit semiannual reporting in US and Canada, approximately half of the investor respondents indicated that a move to semiannual financial reporting would be a negative change and that less frequent reporting could heighten volatility and “tilt the playing field away from public investors and toward, for example, those with access to non-public information or sophisticated data analysis capabilities.” In addition, 13% of investor respondents indicated that semiannual reporting makes sense for smaller, pre-revenue or startup companies, but not for larger, more mature companies. The results indicated that 54% of non-investor respondents specified that semiannual reporting would not be a concern and that boards should be trusted to balance the relevant considerations and make the right decision for the company, with a further 19% indicating that it would be a positive change.
• In response to the SEC’s filer status proposal that would, among other changes, significantly expand the number of US companies exempt from say-on-pay voting requirements, 50% of investor respondents indicate that, where pay concerns and a say-on-pay vote are not on the ballot, they would support in the first year opposing the election of the chair of the compensation committee, and a further 41% of investor respondents supported opposing all incumbent compensation committee members. By contrast, 54% of non-investor respondents said opposition of compensation committee members would not be appropriate under such circumstances.
• In response to whether companies with significant exposure to nature-related risks should disclose information using a recognized framework, 68% of investor respondents said yes while half of non-investor respondents indicated that such disclosure should be left to the discretion of individual companies.

ISS will next release key draft benchmark policy updates for 2027 and open a public comment period. Final benchmark policy updates are expected to be announced in late November or early December and take effect for shareholder meetings occurring on or after Feb. 1, 2027.