Spotlighting Governance Failures by Companies During an SEC Oversight Vacuum
Certain egregious examples of companies that unilaterally omitted shareholder resolutions this proxy season
In mid-November 2025, in a dramatic departure from a decades-long practice, the SEC Staff announced it would not be issuing determinations on the validity of companies’ challenges to shareholder resolutions. Traditionally, if a company sent the Staff a request outlining why it believed it could exclude a proposal from its proxy statement, the proponent could respond and the Staff would consider both sides’ arguments before deciding whether to concur with a company’s request. This has generally been referred to as the “no-action” process because companies are asking the Staff to say they would not recommend enforcement action if proposals are omitted. The SEC Staff’s November announcement created a vacuum that confused companies and investors alike.
Now, a company must still by law provide notice to the proponent and Staff that it intends to exclude a proposal, but the Staff no longer analyzes the substance of the company’s arguments; it simply responds with a letter stating they have “no objection” so long as the company represents that it has a “reasonable basis” for exclusion. The lack of substantive review means that the Staff can issue a no-objection letter very soon after the company requests it and does not need to await a proponent’s response. This rubber-stamping is not even close to the useful guidance for a company or a shareholder that it was intended to be, and undermines a longstanding process. Proponents are left with the option of filing suit to challenge exclusions. To date there have been six such suits filed challenging these unilateral announcements that a company intended to omit a proposal. The suits were filed by city and state pension funds, a foundation, a non-profit organization as well as other investors. Three have been settled, either with the company agreeing to include the proposal in its proxy statement, or agreeing to implement the substance of the proposal.
Fortunately, most companies have not availed themselves of this no-objection process and others that did use it continued dialogue with investors, reaching a meaningful agreement that led to the resolution’s withdrawal. Nevertheless, there have been over 35 challenges on environmental and social proposals thus far, and close to 60 challenges on governance resolutions.
Some companies justifiably sought to omit proposals on technical grounds– for example, if a proposal was filed after the deadline–or made substantive arguments that had merit. But others used the vacuum created by the SEC Staff’s withdrawal to present bare-bones arguments, while still others made weak arguments that likely would not have prevailed under the previous no-action process, knowing the Staff would automatically send a no-objection response that arguably gave them some form of permission to omit the resolution, albeit a much more risky one.
Some companies made specious arguments to exclude a long-established category of proposal that had enjoyed significant voting support. Seven no-objection requests were submitted, all arguing that political spending disclosure resolutions micromanage companies and should be omitted. The companies include Teledyne, American Tower, Cadence, EMCOR, and Fidelity National Financial. This resolution has been voted on for close to 20 years, and hundreds of companies already disclose the requested information. We believe these companies are abusing the process by unilaterally omitting political spending proposals with flawed arguments. We expect many investors will agree that this is an irresponsible decision by management to omit these resolutions.
The following are companies we believe are behaving opportunistically by offering weak or meritless arguments to support their announcements that they intend to exclude proposals, as analyzed by lawyers who specialize in this area of law. Some still have time to reconsider their positions in time to include the proposals in their proxy statements for this year’s annual general meeting:
1. GEO– Lead Filers: The USA Northeast Province of the Society of Jesus, and Mercy Investment Services. The proposal asked the company to report on the effectiveness of its due diligence process to determine whether its services contribute to violations of international human rights law. GEO claimed that the proposal related to GEO’s ordinary business operations because its subject was the company’s services or its legal compliance program. Those arguments have been unsuccessfully made many times in the no-action process in efforts to exclude human rights proposals, and nothing about the GEO proposal would have supported a different outcome, even under recent SEC guidance emphasizing the need for a strong nexus between the company and the proposal topic.
2. AbbVie – Lead Filer: Friends Fiduciary. AbbVie argued that the proposal, which asked the company to produce a human rights impact assessment that included the right to health, was excludable as micromanaging, arguing that it was overly burdensome. AbbVie pointed to a 2025 determination allowing Eli Lilly to exclude a human rights due diligence proposal that was more detailed and prescriptive than the AbbVie proposal, which more closely resembled many past proposals that survived challenge on micromanagement grounds.
3. United Health– Lead Filer: The Durocher Fund. The proposal asked UnitedHealth to report on the healthcare consequences of its acquisitions over the past 10 years. It was closely modeled on a proposal at hospital chain HCA that was unsuccessfully challenged last season on the same ordinary business basis asserted by UnitedHealth. UnitedHealth tried to distinguish the HCA determination by claiming that HCA had failed to make two arguments advanced by UnitedHealth; those arguments were not, however, supported by the proposal’s text or previous SEC Staff determinations. The proponents have sued to protect the proposal.
4. Broadcom – Lead Filer: As You Sow on behalf of Pleiades Trust. This proposal requested a report on how Broadcom is managing systemic climate risk within its retirement plan investment options. This is an important issue for shareholders because investments in high-carbon companies can expose long-term beneficiaries to financial risk, making transparency critical for protecting retirement savings. The company excluded the proposal and ignored As You Sow’s request to meet to discuss a resolution, limiting shareholders’ ability to engage on how climate risk is being managed in employee benefit plans.
5. Royal Gold –Lead Filer: As You Sow. This proposal asked Royal Gold to disclose its diversity and inclusion policies and practices through a public report. This is important to shareholders because transparency on workforce diversity allows investors to better evaluate human capital management, which is tied to long-term performance and risk oversight. The company refused to engage with As You Sow this season and instead treated the SEC no-action letter as resolving the matter, excluding the proposal from its proxy.
6. Chubb – Lead filer: As You Sow. This proposal asked the company to produce a report assessing if and how pursuing subrogation claims for climate-related losses would benefit the Company and its insureds. This is a critical and urgent issue for shareholders because rising climate disasters are driving higher premiums and reduced coverage, creating financial risks that directly affect Chubb’s long-term business. Chubb excluded the proposal from its proxy, prompting a lawsuit by the resolution sponsor and is now fighting service of process from its own shareholders seeking to defend their right to vote on this issue.
7. BJ’s Wholesale Club Holdings – Lead filer: The New York State Comptroller on behalf of the Common Retirement Fund. The proposal sought an assessment of the risks of deforestation for the company’s private label brands and its supply chain. The proponent highlighted its concern for the impact of deforestation on climate. The company argued the resolution was excludable on ordinary business which was disputed in detail by the sponsor. To protect the resolution the Comptroller’s office filed suit.
8. Amazon – Lead filer: IBVM Foundation/SHARE. The proposal asked Amazon to report on the effectiveness of its policies and practices to respect internationally recognized human rights standards, including the International Labor Organization Core Conventions and Declaration on Fundamental Principles and Rights at Work. Amazon claimed it had substantially implemented the proposal by disclosing the company’s processes, including a non-discrimination audit, but did not point to any disclosures regarding the effectiveness of policies on freedom of association and collective bargaining for its own workers.
9. Amazon – Lead filer: SOC Investment Group. The proposal sought reporting from the company on the impacts to its operations and H-1B workers due to changes in U.S. immigration policy and enforcement. Amazon challenged the proposal on ordinary business grounds. A similar proposal will be voted on at Walmart and Alphabet, who did not contest it.
10. Amazon – Lead Filer: American Baptist Home Mission Societies; Alignment of AI Sales with Company’s Responsible AI Approach. This resolution called for information describing the alignment of Amazon’s sale and deployment of artificial intelligence (AI) and related cloud technologies with its Responsible AI Approach. The company was not willing to engage in dialogue on the proposal, despite the fact that the issue was highly material and of great concern to long-term investors.
11. Dell – Lead filer: Friends Fiduciary. The proposal asked for a report on how Dell determines whether its investments in surveillance, and its customers’ use of products and services for surveillance and/or military purposes, contributes to human rights harms in conflict-affected and high-risk areas. Dell claimed that the proposal relates to the company’s ordinary business operations and seeks to micromanage the company. Dell attempted to differentiate this resolution from a previous determination in which the SEC Staff did not concur with Texas Instruments that a proposal with a similar resolved clause was excludable.
12. Teladoc – Lead filer: The New York City Comptroller on behalf of New York City’s pension boards. The resolution requested that Teladoc disclose in its proxy statement each director nominee’s gender and race/ethnicity, as well as the skills and attributes that are most relevant in light of Teladoc’s overall business and long-term strategy. The company argued this was micromanagement and ordinary business even though thousands of companies routinely include such details in their proxy statements. And of course, such information is important for companies seeking to understand a board’s composition and diversity.
13. BP – Lead filer: Follow This, joined by 100 stockholders sought a report on climate change. Multiple outlooks project impending decline in oil and gas demand, but BP’s strategy assumes rising demand. In the last major demand contraction, the company cut dividends by 50%. This resolution asks BP to clarify how it would create shareholder value under credible scenarios of declining oil and gas demand. BP’s board omitted it and Follow This is proceeding to sue.
14. Political Spending – Virtually identical resolutions seeking disclosure of political spending were filed with 29 companies which have so far led to eight agreements and withdrawals. Six companies, including Teledyne, American Tower, Cadence, EMCOR, and Fidelity National Financial, sought no-objection letters using similar legal arguments contending these resolutions micromanaged and citing determinations from the 2025 season allowing exclusion of more detailed lobbying disclosure proposals.
Proponents submitted substantial rebuttals responding to several of these company requests, citing numerous instances of the Staff rejecting similar arguments over a 20-year period, pointing to the hundreds of companies that already publish political spending disclosure, and explaining how lobbying disclosure differs from disclosure of political spending.
