30 Years' 30 Person Interview In China'S Capital Market, An Exclusive Interview With Tu Guang Guang: Marketization Is The Core Of China'S Capital Market Reform And Development.

Editor's note

At the age of thirty, the confident and open Chinese capital market is undergoing a series of core institutional changes, with a view to completing the transformation and magnificent turning. At this critical historical node, the 21 most important witnesses and witnesses of the twenty-first Century economic report and the invitation of the financial and economic APP in the past thirty years have reviewed the past, based on the present and look forward to the future. This article is the first phase of a series of interviews on "30 years and 30 people in China's capital market".

From 1990, the first stock exchange of new China, the Shanghai stock exchange, was established. This year, China's capital market has just passed 30 years.

During this period, China's capital market has gone through a process of constantly breaking through innovation and suffering correction. To build, we must break the inherent resistance and choose a feasible path to make it "from scratch"; but when it develops to a certain stage, when disadvantages appear and limit market development, we need to break through the barriers with keen reform and transform into rebirth.

It is in this way of spiral rise that the A share market has grown into the second largest stock market in the world. But there is still a long way to go from capital to capital power.

At present, China's capital market is undergoing a new round of reform and opening up. How can China's capital market better transform and upgrade the real economy in the future?

In this key historical node, the twenty-first Century economic report has exclusive interview with former vice chairman of the China Securities Regulatory Commission, member of the CPPCC National Committee and executive director of the Shanghai High School of finance, Shanghai Jiaotong University.

1., greater contribution to the reform of share reform.

Twenty-first Century: this year is the 30th anniversary establishment of China's capital market. You can say that you have worked in this field from the beginning of the market. Do you think that the development of the market has reached the expectation at the beginning of its establishment?

Tu Guangshao: when we first started the establishment of exchanges and capital markets, we were more concerned about whether the stock market could get started. As for the future role of the stock market, there was no bottom. In the circumstances, China's stock market needs great courage and determination.

Only when we are first set up can we have further anticipation, if we can do better, play a role, and then say we need to play a more important role. Up to now, a deeper understanding of the importance of the capital market has played a very important role in improving China's financial system and playing a vital role in the reform of the financial supply side.

Therefore, the anticipation of capital market is continuing to extend and improve with the deepening and expansion of reform and opening up, the continuous improvement of market economy and the development of capital market itself. The expectation now is to play a greater role in developing China's structural reform and improving the quality of our development through the development of the capital market.

Twenty-first Century: is there a big resistance to the securities market?

Tu Guang - Sha: at that time, the resistance to organizing the stock market was not small. Even when it started, there were different voices. Some people even said that the stock market should be turned off. Why? Some things do not seem to be a problem at the moment, but it was a big problem at that time, such as "surname surname society". Will the stock market lead to privatization? In particular, the biggest event affecting the capital market was followed by the "810 incident" in 1992. At that time, they said that the order had broken down and the stock market had not been allowed. So there was always a question: should China be able to engage in the stock market? To overcome this resistance is to rely on the courage and wisdom of the central authorities to develop the stock market in the market economy. In particular, comrade Deng Xiaoping put forward that we should allow the trial, look at it again, and not jump to conclusions too early. As a result, the stock market will continue to run. This is Comrade Xiaoping's greatness.

At the same time, in order to successfully pilot and push the stock market smoothly, the system of circulating shares and non tradable shares has been established. The shares of the sponsors who share most of the shares of listed companies are not in circulation, mainly state-owned shares, so that the state shares are not controlled, so they do not worry about privatization. This also shows us the special historical background of the stock market. Another product of the "810 incident" is to set up the SFC and have special supervision departments to exercise supervision over the capital market.

Twenty-first Century: please briefly summarize the achievements of the past 30 years.

Tu Guang: China's capital market has grown from scratch, from small to large. Now the scale of our stock market, Shanghai and Shenzhen exchanges together, the market value has been ranked second in the world, and the scale of the bond market is also second in the world, the scale is very large.

The capital market system is becoming more and more abundant, basically forming a different level of market system. A large number of enterprises get better and faster development through listing and using capital market resources, providing important support for China's industry and economic structure adjustment and optimization, and the structure of investors is also improving. Also, with the continuous opening up, China and the global capital market have formed more and more interactions, not only attracting funds, but also promoting the optimization of resource allocation.

These are all achievements accumulated over the past 30 years, but the efficiency and service ability of our capital market still need to be improved.

Twenty-first Century: when you acted as vice chairman of the SFC, A shares completed a very significant historic reform, that is, share reform. What kind of evaluation can you give it?

Tu Guangshao: I was fortunate enough to cooperate with the main leaders of the SFC to participate in this work. This is indeed a major institutional change. As I said before, if you decide to run the capital market, if you are privatizing, that means you may have a hard time getting through this. So when the company issued shares, it had a letter of ratification, which stated that the sponsors' stock (mainly state-owned shares) was "temporarily not circulated", that is, the split share of tradable shares and non tradable shares. This solves the problem of wanting to engage in the stock market, and avoiding the problem of privatization. Although it is unreasonable from the rear, it has greatly restricted the development of the market. However, from the perspective of capital market establishment, it is reasonable, and it solves the problem of the birth of the stock market. Of course, at the early stage of the development of stock market, the restriction of equity division on stock market is not prominent. However, with the development of the market, the adverse effects will gradually appear, because it is not only the division of shares, but also the division of different shareholders' interests. Finally, the division of shareholders' behavior and the development of capital market are restricted, so we must solve them.

There are two functions to solve it. At that time, the solution to this problem was good for investors to expect stability. Because at that time there was a reduction of state-owned shares. Investors thought that your market was too large to expand. They voted with their feet. Panic was very unstable. Later, through the design of the split share structure, the expectations were stabilized.

More importantly, the basic problems of the long-term development of the capital market have been solved.

There is also a more important issue than solving the problem of split share structure, that is, what ideas and methods should be used to solve the problem of split share structure.

At that time, the SFC extensively solicited public opinions, and collected thousands of articles. I devoted myself to the analysis and collection of those opinions. Why? The main body of the capital market is completely different. Everyone has the best way to help them.

Finally, how can we solve this problem? We use the market approach to solve this problem.

So we must see that the issue of split share structure has solved the advantages of the capital market, and we must see what way to solve the problem. I think the latter is more significant, because the method can solve the specific problems and play a methodological role in the other market-oriented reforms. In fact, there are two words in eight words: unified rules and decentralized decision making.

The core is not to solve the market problem by administrative means. So many investors' interests are different. How can you use the same administrative approach? But we can not go to the other extreme. There are no uniform rules for completely decentralization decisions. This includes huge disorder and non-standard, and even moral hazard.

So in the end, no matter what company, they must follow a set of rules and have a set of procedures to go, but the specific plan is formed according to different situations of the enterprises through different shareholders' consultations. The key is the compensation for the shareholders of the non tradable shares, because everyone thinks that the right to circulation is valuable. Every business is different. How to price it? Is unified pricing OK? No, therefore, first of all, we need to unify the rules. The core of the rule is to protect small and medium-sized investors, while not letting state-owned assets drain.

How to get the specific plan? How do you give consideration? How to deliver shares? How to evaluate? This is the major shareholder and minority shareholder of each company to discuss with themselves and play games. Facts show that this method is feasible, and in every aspect of efforts, two years or so basically solved the problem of split share structure in the stock market.

Twenty-first Century: but in the past two years, there are also some different views on stock reform, because some listed companies have manipulated stock prices and large shareholders have cleared their holdings.

Tu: This is not the same problem. In my view, first of all, the problem of the system, the basic system should be fully circulated, so that we can overcome the restrictions brought about by the split share structure in the past.

As for all his clearance, this part is the behavior of major shareholders. I think it depends on something else. Split share structure is a basic institutional problem to solve capital market, but not all of them. It can not be said that as long as there is a split share structure reform, there will be no other problems.

2. changing the policy market is changing the game relationship.

Twenty-first Century: before, we have always had a concept for A shares, that is, "policy market", including the famous 5. 19 quotation. There is such a factor. What do you think of this problem?

Tu Guang: China's capital market should be pushed from an immature market to a mature market. The most important symbol is that the market game relationship needs to be changed. What we call policy market actually means that investors do not value the performance of listed companies, nor do they look at reforming the economy. What he values is the government's policy.

In the past, the planned economy and the plan were formulated by the government, so the main body of the economy should play a game with the government. Now that the market has been established, investors should pay more attention to the market and affect the operation of the capital market. It is not that it has nothing to do with the government policy. The government policy still has important influence on the market, but the most basic one is the listed company, so more attention should be paid to the industry. The basic situation of listed companies.

What is the value of the so-called value investment? It is the ability of value creation and sustainable development of listed companies, so we need to change the game. Then, when the real market operation mechanism has been established, China's capital market is much more mature.

Twenty-first Century: regulators often say they want to improve the quality of listed companies. What specific suggestions do you have?

Tu Guang Shen: to improve the quality of listed companies, it is not the most basic way to rely on external supervision, external requirements and external strength, but also to rely on the listed companies themselves. That is to say, the internal mechanism and the internal choice from the external requirements to the market indicate that the market mechanism has really been established.

How can it become an internal mechanism? First of all, the structure of investors. Investors can truly identify companies and bad companies, which can form a fundamental constraint on listed companies. Listed companies whose quality is not good will be affected by their stock price and financing. Investors even vote with their feet until the company withdraws from the market. This has formed a virtuous circle.

Another is that the governance structure of listed companies should be truly effective, rather than what we now call God not similar and similar, but it can not really work.

The structure of investors, as well as the listing system, plus the internal governance of the company, I think these three are the internal driving forces to improve the quality of listed companies, plus supervision can be in place, and social evaluation, supervision of public opinion and so on, but the internal is the most important and basic.

Twenty-first Century: the new crown epidemic has a very big impact on small and medium-sized enterprises. In your opinion, how should the capital market play a better role in supporting small and medium enterprises and Inclusive Finance?

Tu Guangshao: from the perspective of financing, the capital market can play some role, of course. With the construction of multi-level market, more enterprises can enter into different levels of capital market, and serve their financing through different ways. But do not go to the other extreme. After all, there is a certain threshold in the capital market, especially small and micro enterprises, which do not necessarily have the ability to operate the capital market. For example, there must be some regulation, your financial system, your business stability and so on. Otherwise, the market mechanism and function of the capital market will be sacrificed, and the long-term development of the capital market will be affected in the future.

But in turn, capital markets may play more roles in the investment perspective. Because as property income, as a financial management, it should be said that not only individuals, small and micro entrepreneurs can also invest and manage through the capital market, capital market development is very good, it provides such a channel.

There is also a more indirect, capital market for such leading companies, the growth of very good companies to provide growth channels, which in turn will lead to many small and micro enterprises in the industrial chain.

We should see its indirect and extended role, so that the capital market and small and micro enterprises can better link up the Inclusive Finance.

3., "who will be delisting" compared with who will create the board?

Twenty-first Century: in recent years, all parties have been raising the capital market at a multilevel level. In your opinion, what kind of multi-level capital market should we build? What are the key and difficult points at present?

Tu Guangshao: the multi-level capital market should be said to have been working for so many years. When I worked in the securities and Futures Commission, I later acted as the vice chairman of the securities and Futures Commission, and also specialized in the management of the market system, so I participated in the construction process of different market systems.

Why is it so difficult to advance? Because the multi-level market has different objects, different regulations, different trading methods and different investment groups. Is there another regulation that can be differentiated in regulation? All these problems are more complicated than simply launching a plate. It needs certain conditions, and also needs certain environment. At the same time, it also needs certain laws and regulations.

Now that conditions are becoming more and more mature, we should say that we have accumulated a good foundation. The big prototype is already available, and now there are main board, medium and small board, gem, Chuang Chuang, new three boards, and four boards. But we need to further improve, not simply set up a plate. Different levels should gradually reflect different levels of matching in the aspects of legal supervision, transaction methods, financing methods and investors' appropriateness, so that the functions of different levels can be fully reflected.

Twenty-first Century: the A share delisting ratio has been very low, and the problem of delisting is widespread, such as backdoor listing, including local governments often use financial subsidies to avoid enterprises from delisting, some agencies even specifically speculation such junk stocks. It is generally believed that this is also a root cause of the A stock valuation disorder. How should we solve this problem?

Tu Guangshao: it does not mean that we do not have the delisting system. But many of those who should have delisted, he can not go back. The problem is here. Why can't we go back? Because behind it is the government. Because a lot of companies were listed on the endorsement of the government, then called the approval system, and then the approval system, so which local governments are reluctant to let its company withdraw from the market, because this is a resource, it is difficult for you to go up, how can let you retire.

The second resistance is investors. It involves thousands of people, but you are going back to a company, which in turn affects the interests of these investors. This is also a need to consider. But just like why we must break the rigid payment, the same is true. If we do not break the rigid exchange, the problem companies will not be delisted, which is the market?

Therefore, the real establishment of a market, especially the market system, depends on all aspects.

At that time, people came to ask me how I felt when I came out of the board. I said, actually, I don't care who is on the board. I pay more attention to who will quit the market in the future. Because you have to build a plate, if there is no institutional change, your plate will return to the inertia of the original history. So the company has problems. Can you refund? This is what I care most about. This is institutional change.

Fortunately, we have seen some good signs now, including the reform of the science and technology board. The core of delisting is to break the shell resources of listed companies. Therefore, the implementation of registration system is not a scarce resource. First, we should not fry the shell. The second governments do not need to protect the shell. Now, the reform of registration system has already solved this problem. Now the core is whether the registration system can be effectively implemented in the true sense.

"Twenty-first Century": the new securities law has been put into effect this year. There have been many discussions recently, especially on penalties for illegal activities in the capital market. We still have doubts about three cups of wine.

Tu Guang: the punishment for illegal behavior is not enough. It has always been a big problem for China's capital market, which is also troubling the regulatory authorities. If the punishment is too low, it is not only a lack of system, but also a distortion of behavior.

We have always called for greater punishment, but we all know that this punishment is not that you want to increase, the regulators should also be supervised according to law, so this is also a systemic problem. I think the securities law has been greatly improved and the punishment has been increased. There is, of course, another requirement to improve the ability of law enforcement, early detection, early treatment and rule of law.

4. "we must work hard on institutional mechanisms to improve direct financing".

Twenty-first Century: there has been a lot of increase in direct financing over the years. The capital market has been given high expectations, but progress has been slow. What do you think the problem is?

Tu Guangshao: it is definitely not a simple quantity change. The number of indirect financing and the increase of direct financing are not so simple.

Realize that this is a profound change. Without looking at this, it is impossible to understand why it is difficult to raise the proportion of direct financing.

First, the degree of marketization of direct financing is higher. Of course, indirect financing is also a market, but the main body is different. So many investors should buy shares, so how can so many investors listen to you? There is no way of unified command. Second, investors are more capable of taking risks. In particular, relative to bank deposits and fixed income, stock investors face more risks and may have higher returns.

Third, capital market requires more market intermediary services. It requires the entire system of service capability, because it requires tens of millions of investors to invest. So what is the demand for macroeconomic situation, changes in the market industry, and stock of the company? All of these involve investment banking, accounting, assessment and so on.

Therefore, the capital market requires not only the market mechanism, the degree of marketization, but also your entire service system, and the stock investors will lose the risk directly, so we have higher requirements for the market development, system matching and so on. We still have shortcomings and shortcomings in these aspects.

Of course, we are getting better now. What is the foundation of the service system? We must rely on reform, opening up, introducing some external service organizations, and improving the transparency of the capital market.

Because these basic conditions are not perfect, such as the degree of marketization, the degree of matching, transparency, and the structure of investors are different, so you want to improve it can not be improved. It does not depend on you, but rather on the institutional mechanism.

Twenty-first Century: you mentioned recently that the financial system is facing three big problems: "big and weak, new and old, low efficiency". Is it equally applicable to the capital market?

Tu Guang: China's capital market has been developing steadily in recent years, but in general, there are still several problems. The scale of capital market is large, but competitiveness, service ability and influence are not strong.

New and old are also such problems. Because of the listing system, the delisting system is relatively old. Now, of course, the new securities law has changed greatly. In addition, there are still many traditional enterprises in listed companies, but new industries and innovative enterprises are still few. This is also a new and old problem.

The same is true for the high and low efficiency. Because the core problem of our capital market, the market survival of the fittest can not be highlighted, and the efficiency of resource allocation can not be improved.

With the establishment of new securities laws, especially the multilevel market, we will gradually overcome these problems, making capital market not only big but also strong, not only traditional enterprises, but also some new leading enterprises, and efficiency is improving continuously. I think this is still possible.

Twenty-first Century: about the opening up of the financial sector, the pace of the two years has been very large. What changes do you expect this will bring to China's capital market?

Tu Guang: China's capital market was originally an open product. In the past two years, we have entered a new round of opening up. There are two reasons, one is our own needs, and the other is that we must persist in promoting globalization.

Why is the past slow? Because we must guard against risks and maintain financial stability. Coupled with the strong spillover of finance, if systemic stability is affected, it will have a great impact on the whole economy. So in the past, it has been cautious and gradually opening up, but relatively slowly.

There are several characteristics after 2018, and the first is speed up. The second area is wider and more comprehensive, and all kinds of institutions are basically open. Third, a deeper degree, called deep openness.

These are not only conducive to the development of our own market, but also to the cooperation with the global economy.

On the impact of opening up. First of all, it will greatly help the market function, including service capability. Internationally experienced head offices not only bring capital, but also their ability to manage, manage risk and service. The improvement of service efficiency is only one aspect, and more importantly, it changes the competition pattern.

It is also necessary to promote cooperation between them and give full play to their respective advantages. Local institutions do not mean that there is no chance, because local institutions are familiar with the local market relative to foreign institutions, and the key is to really play an advantage.

It should be necessary to train the carriers of securities, but the key question is in what way, I think the best choice is to choose the market, plus the guidance of the government.

It is not combined, 1+1 is greater than 2, this is what we want. But if we go against the strength of the market, our competitiveness will not increase, or even cause internal friction.

5. "registration system is good, but it needs other matching to keep up with".

"Twenty-first Century": shortly after the registration system reform of gem was launched, the science and Technology Board will also usher in 1st anniversary. What do you think is the important significance of this series of capital market reform to market development?

Tu Guang Su: to put it this way, I think the registration system is the most significant reform in the capital market in the past 30 years, because it perfected the most basic and core system of the capital market, which is of great significance. It will bring about a series of changes in the capital market. For example, issuance, market behavior, investment behavior will also change, is conducive to value investment, because everyone can go, it depends on who is good. It will also change the structure of investors and will become more and more institutionalized.

There is also a need for more regulation of regulation in the future.

But the registration system itself is not enough, it is the core, the most basic and the most important system, but why did it not dare to use it for so long? Registration system is good, but if there is no other matching, there is no foundation for the development of the whole market, registration system will become a chicken feather. Why? You do not adjust the regulation, illegal punishment can not keep up with, investors' structure has not adapted to change, intermediary services have not kept up, then there is no threshold, cheaters will run to cut leek.

Therefore, it does not mean that the registration system will come into full play immediately. It will need to be matched in all aspects and mature in all aspects, so that the registration system can play a fundamental role.

In twenty-first Century, there is still a property requirement of the science and technology board, but there is no such thing as the gem. If the gem is implemented in the future, will it restrict the development of the science and technology board?

Tu Guangshao: from the top level design, it is SAST, and then to the gem, and it may expand to other sectors in the future. As a system advancing, from increment to stock, I think it is in line with the development rule of a pilot or a new thing.

But it does not mean that the pilot will always be on the "Chuang Chuang" board. If so, the meaning of the capital market will be limited. Only by increasing the quantity to drive the stock, it will be good for the whole market through the first creation of the board, the registration system and the registration system of the gem. This is called a single flower, not a spring. In the future, maybe the main board and the small and medium-sized board market are all liberalized.

Twenty-first Century: we have been talking about the reform of the issuing system of IPO. In fact, there have been many reforms in the past, but there is no way to get rid of the "vicious circle". For example, the "three high" problem and so on. What do you think is the crux of the problem? Will registration system solve this problem?

Tu Guang: no matter whether it is approval or approval, no matter how to reform, the core issue has not changed, that is, the issue and listing is the game between enterprises and government. After the listing, investors and policies are playing games, because they are all approved by the government or approved by the government. The government supervision departments make substantive examination of the enterprises, so although the issuing system is undergoing constant reform, it is also conducive to solving some phased problems. However, some problems still remain to be solved. In this respect, it has emerged from that aspect, because it has not changed the basic relationship between the government and the market.

This is like when I was in the securities and Futures Commission in early years, the listed company started with the quota for every province. He wanted to get more. He made the quota small, all the small companies listed, or even dismantled the big ones.

Later, I found that if I could not do it, I would give it to my family. However, only a few of them can not distinguish in the province, it will spell, for example, the five families make up one, so this company goes up, the performance will decline, why slide? It's big enough to put together, but can a company that is hard put together can do well?

This is not conducive to the improvement of the relationship between the government and the market. Instead, it has become a game between regulators and local governments.

This is my personal experience, one after another, because it always has loopholes, there will always be imbalances. So we can't play a fundamental role.

In twenty-first Century, we still have some doubts about the registration system now, because after all, there is still a process of registration to the regulators. Is it a real registration system? Some people still have some worries.

Tu Guang Sha: registration system is not that simple, that is, once I register, he himself has a set of registration requirements. We should see that it is indeed a fundamental institutional change. As for the registration system itself, first of all, it can be done well at the operational level, which is also very important. The Department that accepts the registration must carry it out well.

Second, more importantly, it is necessary to keep pace with the registered and basic work and keep pace with the other in order to make the registration system play a technical role in the fundamental change of the system. Otherwise, the effect of reform will be discounted.