October 9, with the endorsement of Premier Li Keqiang, the State Council issued the Opinions on Further Improving the Quality of Listed Companies (hereinafter referred to as the Opinions).

Capital market plays an important role in financial operation, and listed companies are the cornerstone of capital market. Improving the quality of listed companies is the internal requirement of promoting the healthy development of the capital market, also the important content of accelerating the improvement of the socialist market economic system in the new era.

In recent years, the number of listed companies in China has increased significantly and the quality has been continuously improved, playing an increasingly prominent role in promoting national economic development. However, it should also be noted that the problems of lacking substandard operation and governance and poor quality of development still exist. There is still a gap between the current situation and the requirements of building a modern economic system and promoting high-quality economic development. At the same time, in the face of the COVID-19 epidemic, listed companies are facing new challenges in their production, operation and high-quality development. To further improve the quality of listed companies, build a standardized, transparent, open, dynamic and resilient capital market, and promote high-quality economic development, the Opinions set out 17 key measures from 6 aspects.

Improve the governance level of listed companies

(1) Standardize corporate governance and internal control.

(2) Improve the quality of information disclosure.

Encourage listed companies to become better and stronger

(3) Support the listing of high-quality enterprises.

(4) Promote market-oriented merger and acquisition and reorganization.

(5) Improve the financing system for listed companies.

(6) Improve incentive and restraint mechanisms

Improve the exit mechanism of listed companies

(7) Strict delisting supervision.

(8) Expand diversified exit channels.

Solve prominent problems of listed companies

(9) Defuse the risk of stock pledge of listed companies actively yet prudently.

(10) Deal with the problem of capital occupation and illegal guarantee strictly.

(11) Strengthen policy support for responding to major emergencies.

Raise the cost of illegal activities of listed companies and related subjects

(12) Intensify law enforcement.

(13) Increase the supply of the legal system.

Form a working force to improve the quality of listed companies

(14) Improve the effectiveness of supervision continuously.

(15) Strengthen the principal responsibility of listed companies.

(16) Urge intermediary agencies to fulfill their duties.

(17) Conhere the strength of all parties.