According to Financial Times News, SEC chair Paul Atkins is alarmed that US-listed companies have dropped by more than 40% over three decades while private-equity-backed firms quintupled. His “make IPOs great again” campaign has already led the SEC to allow companies to bar class-action lawsuits and exclude shareholder questions from proxy ballots. Atkins has also fast-tracked plans to scrap quarterly reporting, arguing these changes will strengthen American competitiveness and help entrepreneurs access capital. The regulatory pullback comes as SEC enforcement actions against public companies have dropped to record-low levels under Trump, with just four announced in the first nine months of 2025. Meanwhile, more US companies have already gone public this year than any year since 2000 except for 2020-21.
The regulatory pendulum swings again
Here’s the thing about financial regulation – it’s always swinging between extremes. After every major crisis like Enron or 2008, we get heavy regulation. Then people complain it’s killing innovation, so we pull back. Now we’re in the midst of another major pullback. SEC enforcement actions have plummeted to basically nothing, and companies are getting protections from shareholder lawsuits that would have been unthinkable a few years ago. The question is whether we’re swinging too far in the other direction.
Why companies really stayed private
Atkins thinks companies avoided IPOs because of pesky regulations and activist shareholders. But that’s only part of the story. When interest rates were near zero, companies could raise tons of money privately without ever needing to prove they could turn a profit. Private equity funds were happy to keep passing these companies around like hot potatoes. Now that money isn’t free anymore, suddenly public markets look more attractive. So is this really about regulation, or was it just about cheap capital?
The dangerous consequences
Look, nobody loves dealing with shareholder lawsuits or activist investors. They can be annoying as hell. But they serve a vital purpose – they’re the check on corporate behavior that prevents another Enron. When you’re managing retirement money for ordinary Americans, shouldn’t there be some pressure to actually pay attention to investor concerns? Removing these protections might make life easier for executives, but it could leave retail investors holding the bag when things go wrong. And things always go wrong eventually.
Where this is heading
The irony is that IPOs are already making a comeback without all these regulatory changes. The stock market’s been roaring, and private equity funds need to return money to their investors. So companies are lining up to go public anyway. But by removing these investor protections, we’re setting the stage for the next corporate scandal. It’s not a question of if, but when. The regulatory pendulum will swing back eventually – it always does. The only question is what damage will be done in the meantime. You can follow the author on X for more financial insights.
