China to enhance market stability mechanisms in 2026-2030: securities regulator

China will work to improve market stabilization mechanisms with Chinese characteristics during the 15th Five-Year Plan period (2026-2030), said Wu Qing, chairman of the China Securities Regulatory Commission (CSRC), on Friday.

Speaking at a press conference on economic issues during the fourth session of the 14th National People's Congress, Wu said the CSRC will expand the tools and mechanisms for cross-cyclical and counter-cyclical adjustments to strengthen the market's internal stability.

The focus will shift toward enhancing the investability of listed companies beyond mere authenticity requirements, he said, adding that key measures include improving corporate governance through refined incentive and constraint mechanisms, boosting shareholder returns via dividends and share buybacks, and revitalizing the mergers and acquisitions market to optimize resource allocation.

The goal is to cultivate more world-class enterprises, Wu emphasized.

The CSRC chief highlighted the market's robust fundamentals, noting that total A-share market capitalization now exceeds 110 trillion yuan ($15.2 trillion). He pointed to significant improvements in market size, structure and quality, with enhanced resilience and risk resistance capabilities.

Wu stressed that the stock market's role as an economic barometer has become increasingly prominent, playing a vital function in stabilizing employment, enterprises, market expectations and overall economic confidence.

Investor protection and tougher action on market misconduct

Wu said authorities will work to build a stronger safety net for investor protection by improving channels for investors to defend their rights and expanding diversified dispute resolution mechanisms.

He added that regulators will promote more representative litigation cases and advance compensation mechanisms such as advance payouts, while tightening oversight of listed companies, controlling shareholders, actual controllers and intermediary institutions.

Authorities will also strictly investigate and punish activities that harm investors' interests, including hype-driven speculation and market manipulation, so that the market can "truly feel fairness and justice," Wu said.

Calling financial fraud a "malignant tumor that erodes the foundations of the capital market," Wu noted that the CSRC accelerated efforts last year to build a comprehensive system to prevent and punish such misconduct. As a result,16 listed companies were delisted for serious financial fraud – far more than in previous years.

Going forward, the regulatory body will further strengthen market discipline and enhance enforcement effectiveness through multiple measures, Wu said.

This includes improving corporate governance to strengthen prevention of financial fraud, promoting the introduction of regulations on listed company supervision, and implementing the newly revised corporate governance guidelines for listed firms, according to the CSRC chief.

On the other hand, authorities will intensify crackdowns on financial fraud by listed companies, strengthen coordinated enforcement against third parties that assist in fraudulent activities, and strictly enforce mandatory delisting rules for companies involved in falsification, he said.

Regulators will resolutely remove bad actors from the market and dismantle the ecosystem that enables financial fraud, Wu said.