This is the first part of our three part series on covering the different aspects of the threats posed by Anthropic’s IPO and other mega IPOs.
Tech Oligarchs’ Bid for Control at Our Expense
Part 2: Securities and Exchange Commission
By Natalia Renta, Associate Director for Corporate Governance & Power
With AI mega IPOs on the horizon, Trump’s Securities and Exchange Commission (SEC) has been hard at work changing rules in ways that would allow founders to maintain the power and control they have over their private companies — as well as the opacity of their operations and financials — when they become public. Anthropic is poised to benefit from these changes.
Less transparency means less accountability
One set of proposals would dramatically reduce corporate disclosures and other requirements public companies currently need to abide by. First up is an attempt to let companies report on their financials semiannually instead of quarterly, which would allow Anthropic founders to keep investors and the public in the dark and open the door for fraud to go undetected for longer periods of time.
Another proposal would dramatically reduce disclosures and other requirements for over 80 percent of public companies, including any company, regardless of size, that has been public for less than five years. Amongst other requirements, these companies would be exempted from:
- Executive pay disclosures including the CEO to median worker pay ratio that illustrate how corporations are contributing to runaway inequality;
- Shareholder votes on executive pay; and
- Auditor attestation of internal control over financial reporting, a key requirement Congress instituted under the bipartisan Sarbanes-Oxley Act to prevent accounting and auditing frauds like Enron and WorldCom.
If this rule is finalized, SpaceX, Anthropic, and OpenAI will be able to avoid scrutiny over their pay and robust oversight over the financials for five years after becoming public.
The SEC is also attempting to use its rescission of the climate-risk disclosure rules to dramatically hamstring its ability to require corporate disclosures well into the future. Its proposed rescission is based on arguments about its statutory authority that are unsupported by statute, caselaw, and past SEC practice, and a preferred policy approach that ignores an overwhelming number of investor voices. The extent of disclosures companies like Anthropic and OpenAI will have to make in the long term once they are public, or that Google or Meta will have to make going forward, hinges on whether courts accept the flawed arguments of Trump’s SEC.
Curtailing shareholder influence
The SEC is also attempting to effectively eliminate the ability of regular shareholders to push companies to address important issues related to workers’ rights, climate, political spending, and more through shareholder proposals. If the SEC is successful in its proposed rescission of the shareholder proposals rule, whether shareholders have this right will depend on individual state legislatures and what companies themselves include in their governing documents. This means that Big Tech firms might never have to hear from their regular investors through shareholder proposals again.
The SEC has even been constraining large asset managers from having a say over the decisions of the companies they are invested in. The four largest asset managers — BlackRock, Vanguard, State Street, and Fidelity — own significant amounts of shares in most public companies. While large asset manager interests do not align with the interests of the many workers saving for retirement whose money they manage, it is still notable that the SEC is transferring the power these intermediaries exerted over corporate decision-making to corporate insiders. In February of 2025, the agency issued guidance suggesting that if asset managers engaged with companies on important issues while owning five percent or more of shares, they could face regulatory compliance costs that would be prohibitive for their business model. The guidance was not clear on what behavior would push asset managers over the line and trigger extra requirements or SEC action against them, which has had a chilling effect on these engagements. So where large asset managers end up owning more than five percent of Anthropic, OpenAI, or any other megacap tech companies, founders may not have to pay attention to them either.
Shutting off access to courts
The SEC sent an open invitation to companies to force their shareholders into arbitration, which prevents shareholders from being able to join forces with each other and hold corporations accountable in open court when they suffer losses. (To date, SpaceX is the only company that has gone public with such a provision since the SEC’s aboutface about a year ago.) It remains to be seen which approach Anthropic will choose — but it should not be up to individual companies to decide.
Further deregulating the financial sector
The reason Anthropic and other AI companies have been able to grow so big and powerful while remaining private is due to the deregulation of private markets, both by the SEC and Congress. This has allowed the venture capital and private equity industries to exercise control over huge swaths of the economy. It used to be that companies had to go public if they wanted to access the resources needed to grow, and with that came some tradeoffs, like greater transparency and more protections for investors. Now, they can get their capital and liquidity needs met for longer periods of time through repeated rounds of VC funding and private credit infusions at ever-spiralling valuations with no reality check on what the financials of the companies actually are. If and when they do access public markets, the SEC is paving the way for these firms to maintain that opacity, concentration of control, and lack of accountability that they are now used to.
Taking on tech oligarchs and their billionaire financial backers
The solutions are clear: undo the long list of actions Trump’s SEC and Congress have taken to deregulate the private markets so that companies go public long before they become behemoths; establish robust requirements for transparency, accountability, and meaningful input for public companies; identify more sustainable ways of financing in the public interest that allows for technological change to thrive without being controlled by a handful of billionaires; and enforce existing laws against corporate and financial extraction. To do that, policymakers have to be willing to take on the power of tech oligarchs and their billionaire financial backers. If we do not take these steps, the tech oligarchs will unilaterally determine how AI is developed, deployed, and regulated.
