Key Takeaways:
- Annual meeting and proxy statement preparation is a predictable, repeatable engagement—making it ideal for fixed-fee pricing that provides public company clients with budget certainty while improving law firm realization rates
- Public companies spend approximately $293,000 annually on combined disclosure and internal governance compliance, with legal fees for proxy statement preparation representing a significant and often unpredictable portion of that spend
- Mid-sized law firms can differentiate by offering transparent proxy season packages that bundle DEF 14A preparation, executive compensation disclosure, and annual meeting support into predictable fixed-fee arrangements
It’s January 15th, and your general counsel client just sent a panicked email: “Proxy season is coming. What’s this going to cost us?”
If your answer involves phrases like “it depends,” “we’ll see how it develops,” or “let me check with our billing department,” you’ve already lost the opportunity to be a trusted partner. In an era where 84% of law firms offer some form of alternative fee arrangements, telling a sophisticated public company client that you can’t predict the cost of an annual recurring engagement isn’t just unhelpful—it’s a competitive disadvantage.
The reality is that proxy statement preparation and annual meeting support represent one of the most predictable practice areas in corporate law. The SEC’s disclosure requirements are well-defined. The timeline is consistent year over year. The deliverables are largely standardized. Yet most law firms continue to bill these engagements hourly, leaving clients to wonder whether this year’s proxy season will cost $30,000 or $90,000.
For mid-sized law firms serving public company clients, this represents a massive opportunity. By developing fixed-fee proxy statement pricing—transparent, predictable packages for annual meeting preparation—you can win client loyalty, improve your own profitability, and establish yourself as the kind of modern firm that understands business realities.
The Economics of Being a Public Company
According to research from Drexel University’s LeBow College of Business, the regulatory costs of being a public company are substantial. For the median U.S. company with a public float of $102 million, combined costs of disclosure and internal governance total approximately $293,000 annually.
These aren’t trivial numbers, especially for small-cap and mid-cap companies. Studies show that once established, small-cap companies can expect to pay about $1.5 million in ongoing compliance costs annually.
Within this compliance burden, the annual proxy statement (Form DEF 14A) represents one of the most significant recurring legal obligations. Every public company must comply with the SEC’s proxy rules whenever management submits proposals to shareholders for a vote—which happens at least annually for director elections.
The proxy statement isn’t just a disclosure document—it’s increasingly a strategic communication tool. As Perkins Coie notes, “the proxy statement has evolved from a pure SEC disclosure document to a solicitation tool that savvy companies use to connect with shareholders to tell their story.”
Why Proxy Statement Preparation Is Perfect for Fixed Fees
Not every legal engagement lends itself to fixed-fee pricing. High-stakes litigation, complex M&A negotiations, and regulatory enforcement matters involve significant uncertainty that makes flat fees risky for both the firm and the client.
Proxy statement preparation is different. Here’s why it’s an ideal candidate for fixed-fee arrangements:
Predictable timeline. Proxy season follows the same calendar every year. For calendar-year companies, definitive proxy statements must be filed no later than 120 days after fiscal year-end (April 30). Companies typically send proxy materials six weeks before the annual meeting. Law firms can plan workflow months in advance.
Defined deliverables. The SEC’s Schedule 14A specifies exactly what must be disclosed. While the substance varies by company, the structural requirements are consistent: voting procedures, director nominations, executive compensation (including the Compensation Discussion & Analysis), audit committee information, related-party transactions, and shareholder proposals.
Recurring engagement. Unlike one-time transactions, proxy statement preparation happens every year. This gives law firms the opportunity to develop deep institutional knowledge of each client’s compensation programs, governance practices, and disclosure history.
Clear scope boundaries. A proxy statement engagement has natural boundaries. It starts with planning and preparation, proceeds through drafting and review, and concludes with filing and distribution. While complications can arise (shareholder proposals, contested elections, SEC comments), these are identifiable risks that can be addressed through scope definitions.
For mid-sized firms already embracing alternative fee arrangements, proxy season represents low-hanging fruit.
Understanding the Scope of Work
To price proxy statement work effectively, you need to understand what’s actually involved. A typical annual meeting engagement includes four distinct phases:
Phase 1: Planning and Preparation (December–January). This includes calendar development, shareholder proposal review, compensation committee coordination, and D&O questionnaire distribution. SEC Rule 14a-13 requires broker searches be initiated at least 20 business days prior to the record date.
Phase 2: Drafting and Review (February–March). This is the core of the engagement—drafting the CD&A, preparing executive compensation tables, completing Pay Versus Performance disclosures (required since 2023), corporate governance disclosures, and coordinating XBRL tagging.
Phase 3: Filing and Distribution (March–April). Filing preliminary proxy materials if required, filing Form DEF 14A with the SEC, and coordinating distribution through full mailing or notice-and-access.
Phase 4: Annual Meeting Support (April–June). Meeting script preparation, virtual meeting logistics, and post-meeting Form 8-K filings.
Structuring Your Pricing: A Tiered Framework
With this understanding of scope, mid-sized firms can develop pricing tiers that match client complexity:
Tier 1: Emerging Growth Company / Smaller Reporting Company ($15,000–$25,000)
Client profile: EGC or SRC with scaled disclosure, straightforward compensation programs, three or fewer named executive officers, no shareholder proposals, uncontested elections.
Included services: D&O questionnaire distribution, proxy statement drafting with scaled disclosure, printer coordination, two rounds of comments, definitive filing, basic meeting script.
Why it works: EGCs and SRCs are exempt from Pay Versus Performance and certain complex requirements, making proxy preparation significantly more straightforward.
Tier 2: Standard Accelerated Filer ($35,000–$50,000)
Client profile: Accelerated filer with full disclosure requirements, typical compensation programs with performance metrics, four to five NEOs, Pay Versus Performance required, possible shareholder proposals.
Included services: Everything in Tier 1, plus full CD&A, Pay Versus Performance table and narrative, shareholder proposal analysis (up to two), XBRL coordination, ISS/Glass Lewis engagement support, post-meeting 8-K.
Tier 3: Large Accelerated Filer / Complex Disclosure ($60,000–$85,000)
Client profile: Large accelerated filer with significant institutional ownership, complex compensation programs, five or more NEOs, meaningful shareholder engagement requirements, multiple proposals, potential proxy advisory firm concerns.
Included services: Everything in Tier 2, plus enhanced CD&A, shareholder engagement strategy, proxy advisory firm response preparation, unlimited comment rounds, board presentations.
Tier 4: Contested or Activist Situation (Custom Pricing)
Client profile: Contested director election, activist shareholder campaign, universal proxy requirements.
Approach: Use a hybrid approach—fixed fee for the “baseline” proxy statement with hourly billing for activist response work, or a phased fixed-fee structure with decision points.
Managing Scope Creep
Fixed fees only work if you can control scope. Here’s how to protect your profitability:
Define clear boundaries. Your engagement letter should specify exactly what’s included (preparation for uncontested election, up to X shareholder proposals, up to X rounds of comments) and what triggers additional fees (contested elections, SEC comment letters, special meetings).
Build in a discovery period. Before committing to a fixed fee for new clients, conduct a preliminary review of prior-year proxy statements, recent 8-Ks, and pending governance issues.
Use change order provisions. When something materially changes the scope mid-engagement—a surprise shareholder proposal, an SEC comment letter—document the scope change and provide a supplemental fee quote before proceeding.
Track your time. Even on fixed-fee engagements, track time for profitability analysis. If you’re using modern billing software, configure it to track time on fixed-fee matters by task category. Review effective hourly rates quarterly.
The Competitive Advantage for Mid-Sized Firms
Here’s the strategic reality: BigLaw doesn’t need your proxy statement work.
For large firms with $1,000+ partner rates, a $50,000 proxy statement engagement is barely worth the administrative overhead. They’d rather handle the M&A deal or the bet-the-company litigation. Proxy statement work often gets pushed to junior associates or priced in ways that frustrate cost-conscious general counsel.
Mid-sized firms can position differently:
Partner attention. A senior partner can actually handle the engagement. Clients appreciate working directly with experienced securities lawyers rather than training junior associates.
Responsiveness. Proxy season is stressful for in-house teams. Being responsive—returning calls the same day, turning comments overnight—builds loyalty that transcends pricing.
Relationship depth. When you handle a company’s proxy statement year after year, you become embedded in their governance infrastructure. That institutional knowledge is valuable.
Pricing transparency. While BigLaw continues to bill hourly and hope clients don’t push back, mid-sized firms can lead with fixed-fee transparency. Clients increasingly demand predictability—and firms that provide it win.
Implementation Roadmap
Ready to launch fixed-fee proxy statement pricing? Here’s your approach:
Q4: Foundation. Analyze your current proxy statement engagements (cost, hours, profitability), develop your pricing tiers calibrated to your market, create standardized engagement letters with clear scope definitions.
Q1: Pilot Program. Identify 2-3 existing clients for fixed-fee pilots, communicate the new approach as a value-add (“We’re offering budget certainty this year”), track every hour to validate pricing assumptions.
Q2: Refinement. Analyze pilot results for effective hourly rate and scope creep, adjust pricing based on actual experience, gather client feedback.
Q3: Full Launch. Update your website with proxy statement service information, create marketing collateral, reach out to referral sources (audit firms, compensation consultants, investor relations firms).
Technology: Your Secret Weapon
Technology plays a crucial role in making fixed-fee proxy statement work profitable:
Document management. Efficient systems for tracking prior-year disclosures and D&O questionnaire responses eliminate redundant work.
Workflow automation. Standardized workflows with built-in deadlines ensure nothing falls through the cracks.
Time tracking. Even on fixed-fee matters, robust billing software that tracks time by task category enables profitability analysis.
Collaboration platforms. Proxy preparation involves intense client collaboration. Secure document sharing and version control are essential.
Common Pitfalls to Avoid
Underpricing complex situations. First-time public companies, companies with recent restatements, or those facing proxy advisory firm scrutiny require significantly more work. Don’t apply Tier 1 pricing to Tier 3 complexity.
Ignoring client responsiveness. Fixed fees create efficiency incentives, but they can’t excuse slow turnaround times. Track turnaround times and measure client satisfaction separately from profitability.
Treating all proxy seasons identically. Some years are straightforward; others bring surprises. Build flexibility into your model—consider hybrid arrangements where baseline work is fixed-fee and extraordinary matters are hourly.
Neglecting post-season analysis. Schedule a debrief after every engagement. Review hours against budget, identify efficiency opportunities, and document lessons learned.
The Bigger Picture: A Gateway to Deeper Relationships
Here’s the strategic insight many firms miss: proxy statement work isn’t just an annual engagement. It’s a gateway to deeper client relationships.
When you handle a company’s proxy statement, you gain intimate knowledge of their governance structure, compensation philosophy, executive team dynamics, and shareholder base. That knowledge positions you for additional work—board advisory services, shareholder activism preparation, securities offerings, M&A transactions.
A $50,000 proxy statement engagement can easily lead to $500,000 or more in related work over time—if you position yourself as a trusted governance partner rather than a document preparer.
Conclusion: Making Proxy Season Predictable
For mid-sized law firms serving public company clients, proxy season doesn’t have to be a billing mystery. The work is predictable. The requirements are well-defined. The timeline is consistent. There’s no reason a sophisticated public company client should face budget uncertainty for an annual recurring engagement.
By developing fixed-fee proxy statement pricing, you accomplish multiple objectives: clients get budget certainty, your firm improves profitability by eliminating write-downs, you differentiate from competitors, and you deepen client relationships by demonstrating that you understand business realities.
The firms that thrive in the coming years won’t be those with the highest billing rates—they’ll be those who align their pricing with client value. Proxy statement work is the perfect place to start.
Ready to modernize your firm’s approach to public company work? The right combination of strategic pricing, clear scope definitions, and modern billing systems can help you capture more value while delivering better client experiences.
FAQ
Q: How do we handle SEC comment letters within a fixed-fee arrangement?
A: SEC comment letters introduce genuine unpredictability and should generally be excluded from your fixed-fee scope. Your engagement letter should specify that SEC staff comments will be billed separately—hourly or at a supplemental fixed fee depending on complexity.
Q: What if a client receives a shareholder proposal after we’ve quoted a fixed fee?
A: Build flexibility into your pricing structure. Specify that your fixed fee includes up to X shareholder proposals. Each additional proposal triggers a supplemental fee (perhaps $2,500–$5,000 per proposal). This protects profitability while giving clients predictability.
Q: Should we track time on fixed-fee engagements?
A: Absolutely. Time tracking on fixed-fee matters is essential for understanding profitability and refining pricing. Track time by phase and task so you can identify which aspects consume the most resources. Review your effective hourly rate after each engagement.
Q: How do we handle contested elections or activist situations?
A: Use a hybrid approach—fixed fee for the “baseline” proxy statement with hourly billing for activist response work, or a phased fixed-fee structure with milestones and opportunities to reassess scope.
Q: Can we offer fixed fees for first-year engagements when we don’t know the client?
A: Yes, but invest in thorough intake first. Review the company’s prior-year proxy statements, recent 8-Ks, and pending governance matters. Consider quoting a slightly higher fee for first-year engagements to account for the learning curve.
Q: How do we compete with firms that undercut our fixed-fee pricing?
A: Don’t compete solely on price. Emphasize partner attention, specialized expertise, and responsiveness. Many clients have learned that a botched say-on-pay disclosure or missed SEC deadline costs far more than fee savings.
Sources
- SEC. “Annual Meetings and Proxy Requirements.” https://www.sec.gov/resources-small-businesses/going-public/annual-meetings-proxy-requirements
- Drexel University LeBow College of Business. “Regulatory Costs of Being Public: Evidence from Bunching Estimation.” 2022.
- BoardEffect. “The Cost of Regulation on Small-cap Companies.” https://www.boardeffect.com/blog/cost-regulation-small-cap-companies/
- White & Case LLP. “Key Considerations for the 2025 Annual Reporting and Proxy Season Part II: Proxy Statements.”
- Perkins Coie. “Public Company Handbook Chapter 7: Proxy Statements and Proxy Solicitation.”
- Gunderson Dettmer. “Preparing for the SEC’s New ‘Pay-Versus-Performance’ Proxy Disclosure Rules.”
- FINRA. “Prepping for Proxy Season: A Primer on Proxy Statements and Shareholders’ Meetings.”
- Brightflag. “Alternative Fee Arrangements Explained.”
