COSO Withdraws its Corporate Governance Framework

On July 16, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) withdrew its draft Corporate Governance Framework (CGF) from public comment.  As discussed in COSO Unveils its Corporate Governance Framework, June-July 2025 Update, COSO intended the CGF to provide “principles-based guidance for organizations to establish and strengthen governance practices, starting in the board-room and cascading throughout the enterprise.”  COSO released the CGF for comment on May 27.

COSO’s press release announcing the withdrawal states that the decision to pull the plug on the current version of the CGF was made in collaboration with the National Association of Corporate Directors (NACD) and “comes amid a shifting regulatory and economic landscape for U.S. businesses and follows the recent passage of a wide-ranging federal law that introduces significant changes to corporate reporting and planning requirements.”  The “wide-ranging federal law” appears to be the 2025 budget reconciliation bill (the One Big Beautiful Bill Act), although that legislation does not directly change corporate reporting requirements. The release adds that, in light of these developments, “COSO and NACD recognize the importance of ensuring that any revised draft framework aligns with the existing requirements and evolving expectations placed on public companies.” 

The comments COSO received on the CGF are not public, and the press release does not discuss their content, although it implies that many comments were negative.  COSO says that it will take the views it received into account in preparing a revised CGF draft: “COSO and NACD will continue to work closely with key constituencies and thank them for their extensive feedback and collaboration. COSO looks forward to reintroducing a refined draft of the Corporate Governance Framework at a future date.”