"Three Key Points" Of Capital Market Construction Proposed By The State Council Of The People'S Republic Of China

On September 23, the executive meeting of the State Council was held to further improve the quality of listed companies, protect the rights and interests of investors, and promote the sustained, stable and healthy development of the capital market.

Focusing on the construction of a standardized, transparent, open, dynamic and resilient capital market, the meeting put forward three major tasks, including improving the governance system and rules of listed companies, improving information transparency and disclosure quality, promoting listed companies to become better and stronger, supporting high-quality enterprises to be listed, and giving full play to the joint efforts of departments to strengthen supervision and greatly increase the cost of illegal and illegal activities.

It emphasizes on "improving the mechanism for institutional investors to participate in corporate governance" and "allowing more qualified foreign investors to make strategic investment in listed companies".

In the view of industry insiders, these policies are expected to improve the governance level of listed companies and help A-share enterprises to become better and stronger.

"After the implementation of the registration system, the supply of enterprises has increased, which puts forward higher requirements for the construction of a fair, transparent and orderly capital market basic system. As key stakeholders, the controlling shareholders, actual controllers, directors, supervisors and senior managers of listed companies have more information. It is more necessary to clearly regulate the behaviors of these key minority groups, increase the punishment for illegal behaviors, and promote key minority groups to focus on their main business and strengthen internal control, not just capital operation High quality of listed companies. " Li Zhan, chief economist of Zhongshan securities, said in an interview.

Institutional investors' participation in corporate governance

Specifically, the executive meeting of the State Council proposed to improve the governance system and rules of listed companies, implement the legal responsibilities and responsibilities of controlling shareholders, actual controllers, directors, supervisors and senior managers, improve the mechanism for institutional investors to participate in corporate governance, and implement the internal control system. Improve the transparency and quality of information disclosure.

In this series of institutional arrangements, "improving the mechanism for institutional investors to participate in corporate governance" has triggered extensive discussions in the market.

In recent years, with the increasingly high degree of specialization of financial institutions, as well as the introduction of various policies to attract medium and long-term funds and foreign capital into the market, it is the general trend for A-share market to move towards institutionalization. Institutional investors also play an increasingly important role in stabilizing the market and promoting value investment. But from the current reality, due to various reasons, the breadth and depth of institutional investors' participation in corporate governance is far from enough.

Zhang Yuewen, director and researcher of the Capital Market Research Office of the Institute of finance, Chinese Academy of Social Sciences, pointed out that after becoming shareholders of listed companies, institutional investors have the legal right to know and participate in corporate affairs. But at present, the more common situation is that the information disclosure of listed companies is not enough, and the attitude of institutional investors to participate in corporate decision-making is not active enough, which makes institutional investors can not exercise the right to know and participate.

In addition, Zhang Yuewen also mentioned: "due to the small shareholding ratio of some institutional investors and the good liquidity of the secondary market, institutional investors are more willing to adopt the method of" voting with their feet "to avoid the risks of listed companies. As a result, the functions of institutions as external regulators are lacking, and some listed companies are" dominated by one share "and the actual controllers are" talking in one voice. "

In this context, many industry insiders call for more detailed institutional arrangements for external shareholders to participate in corporate decision-making.

In Li Zhan's view, investors are divided into different types, including strategic investors and financial investors. Financial investors pay more attention to short-term earnings, while strategic investors generally grow together with enterprises and share the fruits of enterprise growth. To improve the mechanism for institutional investors to participate in corporate governance is to encourage institutions as strategic investors to invest in enterprises, including participation in fixed increase and non-public issuance, so as to bring long-term money to enterprises and share the experience of strategic investors in terms of contacts, management experience and capital.

"First of all, it should be clear that the interests of institutional investors, the management and the major shareholders of the company are consistent, that is, to promote the better development of enterprises. It is necessary to balance the relationship between institutional investors and the company's management and large shareholders, and strengthen communication. Institutional investors should have a full understanding of the localization experience of the company's management and major shareholders, and consider the applicability of their own experience in the localization application. " Li Zhan further pointed out.

Zhang Yuewen also said: "more support should be given to the enthusiasm of institutional investors to participate in corporate governance. It is suggested that the restrictions on the holding of single companies for specific institutional investors, such as funds, trusts and insurance, should be appropriately relaxed. Listed companies should be encouraged to arrange more discussion time for investors in specific occasions such as shareholders' meetings. Listed companies should give more support to improving and maintaining investor relations More attention and practical support should be given. Large shareholders, company management and institutional investors are all important parts of the governance structure of listed companies. They check and balance each other, understand each other, support each other, and form a joint force, which is an important guarantee for listed companies to embark on the track of sound development. "

Foreign investment in a shares

In addition to the requirements on the system under construction and strong supervision, the executive meeting of the State Council also proposed to promote the listed companies to become better and stronger. The specific contents include: supporting the listing of high-quality enterprises; improving the systems of asset restructuring, acquisition and split listing of listed companies; improving the refinancing and debt issuance systems of listed companies; and allowing more qualified foreign investors to make strategies for listed companies Investment; improve standards, simplify procedures, smooth channels, improve the diversified exit mechanism of listed companies; crack down on the behavior of evading delisting.

Among them, "allowing more qualified foreign investors to make strategic investment in listed companies" has been interpreted by many industry insiders as a signal to liberalize foreign strategic investment in A-share listed companies, which has triggered a heated discussion in the market.

Gong Xiaolin, executive chairman and Secretary General of Zhejiang Ma Federation, pointed out: "the intention to open up listed companies to introduce foreign strategic investors is conducive to the improvement of relevant basic systems on the one hand; on the other hand, the introduction of foreign strategic investors is also conducive to the further improvement of the governance system of listed companies, and the professionalization, institutionalization and standardization of corporate governance International level. With the gradual improvement of relevant basic systems, it is expected that relevant cases will be gradually implemented in the near future, which is a long-term development trend and direction. "

As a matter of fact, as early as June this year, the Ministry of Commerce solicited public opinions on the administrative measures for strategic investment of foreign investors in listed companies (Revised Draft for public comments) (hereinafter referred to as the measures), and planned to significantly reduce the threshold of foreign investors' strategic investment in listed companies.

In Li Zhan's view, expanding the opening of the capital market to the outside world and introducing foreign strategic investors can, on the one hand, learn from each other's strengths to complement each other, optimize the corporate governance structure, and improve the quality of the company; on the other hand, it is also conducive to restraining enterprise behavior and maintaining a good market order.

However, in terms of specific implementation, market participants also pointed out that safety issues should be fully considered.

Zhang Yuewen believes that foreign strategic investors should be long-term foreign investors with strategic significance for the development of listed companies. Strategic investors usually not only bring capital to listed companies, but also technology, market and other important commercial resources.

"For a long time, due to the consideration of national economic and financial security, China has always had restrictions on foreign institutions' strategic investment in domestic listed companies. To open the capital market to the outside world at a high level, it is necessary to fully consider the security issues, and according to the overall plan of the country's opening to the outside world, open the industries beyond the negative list to foreign investors, give them national treatment, and allow them to participate in strategic investment of listed companies, so as to help improve the management level of China's listed companies, better integrate into the process of globalization, and effectively Resist the impact of counter globalization. " Zhang Yuewen said.

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