The quality of listed companies is the cornerstone of the capital market, directly shaping its overall strength.
On October 9, 2020, the State Council issued the Opinions on Further Improving the Quality of Listed Companies, laying out 17 key reform measures across six major areas and drawing a clear roadmap for the quality-driven development of A-share listed companies.
Now, six years have passed since the Opinions took effect.
Over these six years, regulators have continuously built institutional frameworks and tightened oversight, strengthening external hard constraints on the market, while listed companies have proactively aligned with reform requirements and fully activated their internal drive for quality improvement.
"Overall, external regulatory pressure has been continuously transformed into internal motivation for self-reform among listed companies. Corporate governance structures have become more robust, risks have been proactively addressed, and development has refocused on core businesses. The endogenous transformation of listed companies has laid a solid micro-level foundation for the high-quality development of the capital market," said Fu Yifu, a special researcher at Sushang Bank.
Strengthening Hard External Regulatory Constraints
Over the past six years, regulators have closely focused on three key levers—institutional improvement, strict enforcement, and survival of the fittest—continuously strengthening external constraints on the high-quality development of listed companies.
First, a systematic institutional framework has been rapidly established. Over the six years, with three foundational laws—the new Securities Law, Amendment (XI) to the Criminal Law, and the new Company Law—serving as cornerstones, a series of policies and measures have been rolled out successively, forming a well-connected, multi-tiered institutional system. A comparison by the Securities Daily of the six areas and 17 measures mentioned in the Opinions with the institutional measures introduced over the six years found that approximately 80% of the provisions have been translated into specific regulations and are operating substantively. For example, in corporate governance, measures such as the independent director management rules, the replacement of supervisory boards by audit committees, and new share reduction rules have been fully implemented; in information disclosure, the information disclosure management measures under the registration-based system, sustainability reporting guidelines, and comprehensive opinions on preventing and punishing financial fraud have formed a complete quality control system for information disclosure; in the investigation and punishment of violations, the administrative penalty discretion rules (2025) and guidelines on connecting administrative and criminal enforcement have significantly improved the standardization of enforcement; in investor protection, special representative litigation has become routine.
Second, regulators have maintained a "tough and sharp" approach. Over the six years, a three-pronged accountability system combining administrative enforcement, civil liability, and criminal prosecution has been rapidly developed, significantly raising the cost of violations. Taking administrative penalties as an example, according to data from the CSRC website, from 2020 to 2025, the number of administrative penalties issued by the CSRC showed an overall upward trend, reaching 349, 371, 384, 539, 592, and 661 respectively. Meanwhile, regulators have continued to keep a close eye on the "key few" at listed companies. From 2023 to 2025, the number of responsible entities penalized stood at 1,073, 1,327, and 1,506 person/entity-times respectively, using rigid enforcement to hold market participants accountable.
Third, the delisting system has delivered results, accelerating the market's survival-of-the-fittest mechanism. Improving the exit mechanism for listed companies is one of the core tasks outlined in the Opinions. Before the reform, the average annual number of delisted companies in the A-share market was only about 8. In December 2020, new delisting rules took effect, with four categories of mandatory delisting indicators—financial, trading, regulatory, and major violations—fully implemented. Over the six years, the average annual number of delisted A-share companies rose to 36, with the proportion of trading-based delistings increasing significantly, fully demonstrating the market-oriented clearing power of investors "voting with their feet."
Under regulatory constraints, market rules and boundaries have become increasingly clear, forcing listed companies to confront their own governance shortcomings and shift from passive responses to proactive improvements, with the endogenous forces of change among market participants continuing to accumulate.
Activating the Internal Drive for Corporate Quality Improvement
Over the past six years, A-share listed companies have worked hard to strengthen themselves in three directions: solidifying internal governance, resolving their own chronic issues, and focusing on core business development. The internal drive for quality improvement has been continuously released, with more and more companies translating high-quality development requirements into conscious actions in their internal operations and management.
A-share listed companies have used governance iteration to solidify their development foundation, pushing governance effectiveness toward "substantive effectiveness." For example, the reform replacing supervisory boards with audit committees represents a major adjustment to corporate governance structures. According to Wind data, as of now, all A-share listed companies have completed relevant amendments to their articles of association. In this regard, Song Xiangqing, vice president of the China Commercial Economics Society, told the Securities Daily that the core logic of this reform is to strengthen the supervisory function of the board of directors and reduce unclear responsibilities caused by overlapping governance layers.
At the same time, A-share listed companies have used self-correction to resolve prominent chronic issues, proactively shoring up risk weaknesses in their operations. Facing long-standing pain points such as fund misappropriation and irregular guarantees, listed companies have actively established internal prevention and control mechanisms, implemented the three-pronged governance requirement of "punishment, prevention, and treatment," and proactively investigated and resolved legacy issues.
Furthermore, listed companies have deepened their core businesses to strengthen and excel, achieving two-way improvement in shareholder returns and industrial integration. For example, under policy guidance, listed companies' awareness of shareholder returns has significantly increased. According to data from the China Association for Public Companies, total cash dividends in the A-share market grew from 1.52 trillion yuan in 2020 to 2.43 trillion yuan in 2025, an increase of 59.87%, with a notable rise in the number of companies paying interim dividends; share buyback scale grew from approximately 68 billion yuan in 2020 to 130.77 billion yuan in 2025, an increase of 92.31%, with repurchased shares widely used for equity incentives, employee stock ownership plans, and other purposes.
Over the six years, through coordinated internal and external reforms and two-way efforts, the governance systems of listed companies have been continuously improved and governance effectiveness steadily enhanced. In Fu Yifu's view, a sound governance system can effectively reduce operational uncertainty, continuously attract medium- and long-term capital into the market, and drive the market's investment logic to shift from short-term thematic speculation to long-term value cultivation, making the value investing character of the A-share market increasingly distinct.
"The market-oriented mechanism of survival of the fittest and a standardized, transparent market environment have further unclogged the capital market's resource allocation channels, allowing high-quality factors such as capital, talent, and technology to continuously gather toward high-quality listed companies, greatly enhancing the capital market's core capacity to serve industrial development," Guo Tao, deputy director of the China E-commerce Expert Service Center, told the Securities Daily.
Standing at a new starting point, how can the quality improvement of listed companies be better advanced? Guo Tao said that future quality improvement work for listed companies can further shift toward normalized deepening and systematic enhancement. On one hand, regulators should continue to improve supporting institutions, refine constraint and incentive mechanisms, and optimize investor protection; on the other hand, the primary responsibility of listed companies should be further reinforced, guiding companies to make rational investments and financing, standardize information disclosure, and continuously improve corporate governance.
Six years of reform practice have fully proven that the maturity and progress of the capital market depend both on the rigid constraints of institutions and on the self-renewal of market participants. Looking ahead, the capital market will continue to adhere to the market-oriented and law-based direction, using institutions as the cornerstone and regulation as the sharp sword, continuously driving two-way efforts in external constraints and endogenous quality improvement, and promoting listed companies to keep strengthening and excelling.