SEC’s reconsideration of rulemaking for pay versus performance and cybersecurity disclosure rules

On March 31, 2025, a letter was addressed to Mark Uyeda, the Acting Chairman of the U.S. Securities and Exchange Commission by members of the U.S. House of Representatives Committee on Financial Services. The main objective behind this letter was to reverse the effects of the decisions made during former Chairman Gary Gensler’s leadership. The letter specifically requested the withdrawal of fourteen final and proposed rules, including the SEC’s Pay Versus Performance rules that were put into effect in August 2022, as well as regulations pertaining to Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure that were implemented in July 2023.

The possibility of the SEC actually revoking these rules lies within the framework of the Administrative Procedure Act, which typically involves a period where the public is informed of the proposed changes and is given the opportunity to provide feedback. The fate of these rules now rests in the hands of the incoming SEC Chairman, Paul Atkins, leaving many eagerly awaiting his response to this situation.

The letter underscores a clear disagreement with the rules that were put in place under Gary Gensler’s leadership, suggesting that these regulations were considered detrimental and required immediate action to be rectified. This stance was clearly expressed through the request for withdrawal of these rules, emphasizing the committee’s opinion that they were not in the best interest of the financial services sector.

In light of the potential withdrawal of these rules, the financial services industry is bound to experience some shifts as a result. The implications of such a decision by the SEC could have far-reaching consequences on various stakeholders within the industry, including companies, investors, and regulatory bodies. The decision to repeal these rules would undoubtedly bring about a new regulatory landscape that will require careful navigation by all parties involved.

As the situation unfolds, it will be crucial to monitor the developments closely and observe how the SEC, under the leadership of Paul Atkins, responds to the committee’s request. The outcome of this decision will undoubtedly have a significant impact on the financial services industry and will shape the future trajectory of regulatory policies in the years to come. Stay tuned as these events continue to unfold, offering insights into the changing dynamics of the regulatory environment amidst shifting leadership within the SEC.