Securities and Exchange Commission Chair Paul Atkins wants to “make IPOs great again.”
In a speech on Tuesday, the Trump-appointed head of the SEC outlined how the agency will work to lighten public disclosure requirements for smaller and newer companies in an effort to bring more of them to the public market.
“If we want the next generation of innovators to choose our public markets, we need disclosure that is calibrated for a company’s size and maturity,” Atkins said during a speech delivered at the New York Stock Exchange.
Atkins noted that under current reporting requirements, a company with a $250 million market capitalization must file the same public disclosures as a firm 100 times its size. That burden, he argued, has contributed to a roughly 40% drop in the number of public companies since the mid-1990s.
The chair also laid out a broader goal of reworking public disclosures for all companies by mandating that all of the public information they give must be financially material.
The shift would mark a reversal of efforts in recent years that have called for public companies to share more information with investors relating to their environmental, social, and governance (ESG) policies.
“Our capital markets thrive not through the volume of disclosures, but the clarity and importance of them to investors,” Atkins said.
The chair also signaled possible reforms to executive pay disclosure.
Citing consensus from a recent SEC gathering and echoing a criticism by Warren Buffett, Atkins argued that the existing rules have led to bloated proxy statements and other public filings that have offered little benefit to shareholders.
Atkins’ goal to narrow public disclosures and tailor their rigor based on a company’s size is just one leg of his plan to make it less expensive and arduous to run a public company.
The head of Wall Street’s top securities regulator is also looking to make it easier for companies to ignore shareholder proposals in their proxy materials related to ESG matters, such as those calling for more transparency and reporting by companies on their workforce diversity, carbon emissions, and executive pay.
There are far fewer public companies today than there were in the three decades before the financial crisis, according to data from the World Bank. That entails some combination of fewer companies seeking to go public and more public firms looking to go private despite a booming US stock market.
Despite a volatile spring with the rollout of the Trump administration’s sweeping tariff plans, the US IPO market has seen several major listings this year, including CoreWeave (CRWV), Klarna (KLAR), Figma (FIG), and a host of crypto firms like Circle (CRCL) and Bullish (BLSH).
