Everything looks fresh with the coming of spring. The Shanghai Stock Exchange (SSE) declared that according to the requirements of the “Opinions on Further Strengthening the Protection of Small and Medium-sized Investors’ Legitimate Rights and Interests in Capital Market” released by the General Office of the State Council, the SSE will adopt measures in different aspects, continue to strengthen efforts on protecting investors’ rights and interests, highlight the market’s fairness and justice, and further deepen the friendship with investors in the new year, so as to bring people together, gain popularity, and promote the sound development of the market.
The SSE Composite Index has fallen by 6.75% accumulatively in 2013. The SSE said that though it is not suitable for the market service and regulatory work to take the increase of the Index as the goal, the market performance still reflects the economic structure, the listed companies’ structure, the investment preferences, and other underlying institutional factors in different aspects. However, in face of such situation, all staff of the SSE still feels very anxious. They should make in-depth reflection on whether investors have experienced fairness and justice in the investing activities of the Shanghai market, whether the investing environment of the Shanghai market is friendly, convenient, and safe enough, and whether the Shanghai market has fully adapted to the direction and pace of the adjustment to the economic structure and met investors’ demands.
“We should first make introspection as introspection can lead to courage and second be inclined to goodness which will lead to the future.” An official of the SSE said that in terms of the SSE, strengthening the protection of investors’ rights and interests should first focus on the regulation on listed companies due to a very simple reason: investors have contacted with listed companies most frequently and the regulation on listed companies is one of the most fundamental and most pivotal service projects provided by the SSE for investors. “In recent years, we have increasingly felt that to achieve the sound development of the market, we should pay attention to both its investing function and its financing function. Apart from such economic factors as evaluation as well as supply and demand, such social factors as fairness and justice also have great significance to the market’s good development. As a result, we should proceed from the most fundamental and most pivotal work of service and regulation, safeguard the principle of ‘openness, fairness, and justice’, and protect the legitimate rights and interests of investors, especially the small and medium-sized investors, so as to promote the sound development of the market.”
Since the beginning of 2013, the SSE has demanded that some listed companies that have triggered market attention and query should hold meetings to explain the circumstances and directly respond to the reasonable query of the market and the public; it has released the “Implementation Measures of Disciplinary Sanction and Regulation” and integrated various punishment measures with an aim to enrich regulation methods and enhance the transparency of the regulation; it has explored to establish the Rapid Response Mechanism of Regulation on Listed Companies with an aim to make positive interaction with the media and the market and to enhance the pertinence and effectiveness of the regulatory work; it has launched the interactive information disclosure service of “SSE E-interaction Platform” to provide an effective tool for listed companies to enhance their transparency and increase their awareness and capacity of serving shareholders. Besides, the SSE has also launched the direct channel for information disclosure to urge information disclosure obligators to fulfill their responsibility, and coordinated with all sectors of society to do well in regulation; it has pushed forward the industry-classified information disclosure with an aim to further reveal the companies’ investing value and clarify investment factors, so as to provide new methods for enhancing the effectiveness of information disclosure; it has also released the “Guidance for Cash Dividend Distribution”, tried to transfer differentiated regulatory pressure to listed companies, and led listed companies to positively reward investors. “It should be mentioned that these measures have helped to protect investors’ legitimate rights and interests. Their effects are to be tested by the market and are to be shown gradually”, said the SSE official.
The SSE proposed that in the new year, in terms of the market entrance, it requires that “fraud-listed” issuers should buy back all the IPO-related shares in line with the revised “Guidance on Format of Listing Announcement” and compensate for investors’ losses according to law; and it will implement relevant rules on stabilizing share prices, decreasing shareholding, lock-up period, and shareholding intention. With regard to continuous regulation, the SSE will timely optimize a series of new measures launched in 2013, such as fully implementing the direct channel at the proper time, increasing listed companies’ frequency of holding explanation meetings, expanding the coverage of industry-classified information disclosure, improving the rapid response mechanism, optimizing the functions of the “E-interaction” platform, and setting up a blue-chip board with high yield; it will explore in the continuous information disclosure system; moreover, it will further strengthen the transparency of the market, and formulate and release the list of the SSE’s technologies, business lines, and regulation; it will explore a performance evaluation working mechanism on regulation based on investors’ comments; and it will also build a regulatory mode that will help to protect investors’ rights and interests and adapt to the new development situation of the market.
It is learnt that the SSE will make improvements, then disclose in due time to the market, in such aspects as enriching product varieties, meeting investors’ demands, optimizing listed companies’ structure and quality, enhancing the vitality of the blue-chip market, and cracking down on illegal behaviors on the market in 2014.
The SSE has noticed that since the end of last year, major professional institutes in the market have released their research reports one after another, over half of which were positive of the Shanghai market in 2014 and less than 20% were pessimistic. Most professional institutes believed that the market is more likely to go up in 2014 rather than go down for the following reasons. First, the 3rd Plenary Session of the 18th CPC Central Committee (the “3rd Plenary Session” for short) has changed the middle and long term economic expectation of investors and the reform will lead to the increase of risk preferences and the long-term incremental capital’s entering into the market; second, the macro-economy is gradually ascertaining the bottom and enterprises’ earnings have been recovered; finally, the global economic recovery led by developed markets will provide cushion for China’s reform.
“We cannot predict the results of the ups and downs of the Shanghai market in the new year. But we believe that strengthening the protection of investors’ rights and interests will help to enhance the users’ experience in the Shanghai market, bring people together and gain popularity. It is hoped that the market and all sectors of society will continue to care for, support, and supervise the SSE’s work and jointly promote the sound development of the SSE market.” said relevant official of the SSE.