China to strengthen market stabilization, investor protection during 15th Five-Year Plan

BEIJING: Wu Qing said on Friday that China will work to improve market stabilization mechanisms with Chinese characteristics during the 15th Five-Year Plan period, as regulators seek to enhance the resilience and long-term stability of the country’s capital markets.

Speaking at a press conference on economic issues during the fourth session of the National People's Congress, Wu, who heads the China Securities Regulatory Commission (CSRC), said authorities would expand policy tools and institutional mechanisms for cross-cyclical and counter-cyclical adjustments in order to strengthen the internal stability of the market.

According to Wu, regulators will focus on improving the overall investability of listed companies rather than merely ensuring the authenticity of disclosures. Measures will include strengthening corporate governance through refined incentive and restraint mechanisms, enhancing shareholder returns through dividends and share buybacks, and revitalizing the mergers and acquisitions market to facilitate more efficient allocation of resources.

He said the objective is to cultivate a larger number of world-class enterprises capable of driving high-quality development and strengthening the competitiveness of China’s capital market.

Highlighting the strong fundamentals of the Chinese stock market, Wu noted that the total market capitalization of A-shares has surpassed 110 trillion yuan (about $15.2 trillion). He said the market has witnessed steady improvements in scale, structure and quality in recent years, while its resilience and ability to withstand risks have continued to strengthen.

Wu added that the stock market’s role as a key barometer of the national economy has become increasingly prominent, playing an important role in stabilizing employment, supporting businesses, maintaining market expectations and boosting overall economic confidence.

On investor protection, Wu said regulators will work to build a stronger safety net by improving channels that allow investors to safeguard their rights and by expanding diversified dispute resolution mechanisms.

Authorities will also promote more representative litigation cases and advance compensation systems such as advance payment mechanisms, while tightening oversight of listed companies, controlling shareholders, actual controllers and intermediary institutions involved in capital market operations.

Wu emphasized that regulators will take tougher action against misconduct that harms investors’ interests, including hype-driven speculation and market manipulation, so that the market can “truly feel fairness and justice.”

Describing financial fraud as a “malignant tumor that erodes the foundations of the capital market,” the CSRC chief said authorities accelerated efforts last year to establish a comprehensive framework to prevent and punish such violations.

As a result, 16 listed companies were delisted due to serious financial fraud—significantly higher than in previous years—demonstrating the regulator’s determination to clean up the market environment.

Looking ahead, Wu said the CSRC will further strengthen market discipline and improve enforcement effectiveness through multiple measures. These include improving corporate governance structures to prevent financial fraud, promoting the introduction of regulations on the supervision of listed companies, and implementing newly revised corporate governance guidelines for listed firms.

At the same time, authorities will intensify crackdowns on financial fraud by listed companies, strengthen coordinated enforcement against third parties assisting fraudulent activities, and strictly apply mandatory delisting rules for companies involved in falsification.

Wu said regulators remain committed to removing bad actors from the market and dismantling the ecosystem that enables financial fraud, ensuring a healthier and more transparent capital market environment in China.