Recently, Li Chao, Vice Chairman of the China Securities Regulatory Commission, outlined that during the "15th Five-Year Plan" period, the focus will be on enhancing both the quality and investment appeal of listed companies. He underscored a stronger push to invigorate merger and acquisition reforms, enabling listed firms to upgrade and expand, while also elevating corporate governance standards and guiding companies to boost their intrinsic value through equity incentives, dividends, and share buybacks. He added that the delisting system will be strictly enforced and continuously refined.

Listed companies serve as the bedrock of the capital market, with their quality directly shaping the market's ecosystem and investment attractiveness. This reform initiative aims to drive efficiency and improvement in listed firms through targeted measures spanning M&A, governance, dividend policies, and delisting procedures. Industry experts interviewed by our reporter generally concur that these coordinated measures are pivotal, not only for transitioning the market from scale expansion to quality enhancement but also for fundamentally reshaping the value logic of the A-share market and cementing value-driven investment principles.

These initiatives are complementary and precisely targeted, simultaneously clearing the institutional path for quality companies to grow, reinforcing safeguards for investor rights, and purifying the capital market environment. They are designed to steer the market back toward "value creation and value returns," laying a robust foundation for sustained, healthy long-term development.

Balancing Expansion and Quality Enhancement

A high-caliber cohort of listed companies forms the core pillar of a thriving capital market. According to Wind data, the A-share market currently hosts 5,562 listed companies, with total circulating market value reaching 113.05 trillion yuan. In the first half of 2026, these companies collectively generated 37.76 trillion yuan in operating revenue, a 7.6% year-on-year increase, maintaining steady growth momentum. Net profits reached 3.58 trillion yuan, up 19.5% year-on-year, with growth accelerating by 16.7 percentage points compared to the previous full year.

During the "15th Five-Year Plan" era, the capital market reform agenda balances incremental expansion with the enhancement of existing stock, optimizing market structure from perspectives like industrial upgrading, value return, and risk clearance to systematically bolster listed company quality. Specifically, M&A and restructuring serve as the primary lever for unlocking growth momentum and increasing the pool of quality assets. Li Chao noted that since the 2024 release of guidelines on deepening M&A market reforms, listed companies have disclosed 370 significant restructuring transactions, with numerous quality enterprises accelerating transformation and achieving value growth through these deals.

Simultaneously, dividend distribution and share buyback mechanisms act as vital tools for consolidating the value of existing listed entities. Cash dividends offer the most direct means of rewarding investors, reflecting a company's operational stability and cash flow strength, while providing steady income returns to long-term investors. Share buybacks can stabilize stock prices and boost market confidence when a firm's value is undervalued; coupled with equity incentives and employee stock ownership plans, they also bind core teams to the company's interests, spurring internal growth drivers.

An Guangyong, an expert from the Credit Management Committee of the All-China Federation of Industry and Commerce M&A Association, remarked to our reporter that unlike "one-size-fits-all" mandatory distribution requirements, the current regulatory approach is more scientific and flexible. It takes into account corporate growth cycles and development needs, encouraging companies to craft differentiated dividend and buyback plans based on their operational circumstances and industry characteristics, thereby safeguarding investor interests while retaining sufficient funds for future expansion.

Moreover, a normalized delisting system is a critical guarantee for purifying the market ecosystem and clearing out low-quality incumbents. Following multiple rounds of institutional optimization, the A-share market has now established a multi-dimensional delisting index framework covering financial, trading, regulatory compliance, and major violations. Li Zhan, chief economist at the research department of China Merchants Fund, told our reporter that regulators adhere to the principle of "delisting where applicable," effectively curbing the occupation of scarce market resources and market disruption by inferior companies. At the same time, the delisting reforms balance efficiency and fairness, with continuous improvements to risk warning, investor protection, and post-handling mechanisms. These reforms hold listed companies and intermediaries accountable, crack down on attempts to circumvent delisting rules, and, through strict market exit mechanisms, compel all listed firms to maintain sound governance and stable operations, thereby elevating overall compliance quality.

Strengthening the Cornerstone for Investment and Growth

The coordinated implementation of reforms across M&A, dividends, and delisting represents more than just a simple sum of separate policies; it signals a profound reshaping of the capital market's development philosophy, carrying far-reaching strategic importance for optimizing the market ecosystem, restoring the market's investment essence, and supporting high-quality real economic growth.

From an ecosystem perspective, these reforms construct a market-oriented mechanism of survival of the fittest, characterized by "winners advance, the strong thrive, and the weak exit," effectively squeezing speculative activity around shell resources. Tian Lihui, a finance professor at Nankai University, stated to our reporter that quality enterprises continuously grow stronger through M&A, give back to investors via dividends and buybacks, while inferior companies exit in an orderly manner through regularized delisting. This drives market resources to concentrate toward high-quality core assets, dramatically improving resource allocation efficiency and transforming the capital market into a genuine platform for identifying and cultivating excellent real-economy enterprises.

In terms of investment logic, the series of reforms is poised to reshape the valuation framework and investment philosophy of the A-share market, helping to embed value-driven and long-term investing principles. As listed companies normalize dividend payouts, standardize operations, and elevate their quality, corporate investment value will be firmly anchored to profitability, industrial competitiveness, and shareholder return capacity, leading to more rational and transparent market pricing. Stable cash returns, sustained corporate growth, and a healthy market environment will continue to attract long-term capital, optimize the structure of market participants, and solidify the long-term upward trajectory of the capital market.

In Li Zhan's view, a genuine virtuous cycle of investment and financing is not about simply increasing the number of listed companies, but forming an ecosystem where "quality enterprises can raise funds, outstanding firms can sustain growth, investors can share in the gains, and low-quality companies exit promptly."

From the perspective of serving the real economy, the multi-dimensional reform precisely addresses bottlenecks and challenges in capital market services. Tian Lihui believes that empowering the real economy through M&A facilitates industrial transformation and upgrading, helping traditional industries rejuvenate, emerging sectors expand, and tech innovation break through. Standardizing dividend and buyback mechanisms guides enterprises to focus on their core businesses, adopt prudent and sustainable development approaches, and by normalizing delisting, the market environment is cleansed, upholding compliance standards and creating a fair financing environment for quality real-economy firms. The capital market is evolving beyond a mere financing platform into a specialized capital aggregation system that genuinely supports corporate growth, drives industrial advancement, and rewards societal investors.

Industry experts broadly indicate that the core objective of the reform measures for the "15th Five-Year Plan" period is to return the capital market to its fundamental purpose. As reforms deepen and take effect, corporate governance, operational quality, and investment value of listed companies will continue to rise. The capital market will progressively form a positive cycle of "high-quality corporate development, efficient market allocation, and enhanced investor satisfaction," continually fulfilling its pivotal role and providing solid capital support for the high-quality development of China's economy.