Under the unified guidance of the China Securities Regulatory Commission (CSRC), the Shanghai Stock Exchange (SSE) has recently published revised versions of the Guidelines for Share Repurchase, Guidelines for Standardized Operation, and supporting business guidelines, aiming at enhancing the share repurchase and cash dividends systems. These revisions are reflective of the adjustments and arrangements made by the CSRC at the self-regulation level, ensuring a proper transition. Share repurchases and cash dividends play a pivotal role in invigorating the capital market and bolstering investor confidence, with a direct impact on investor interests, particularly those of small and medium-sized investors. This further facilitates the stable functioning of the capital market.

In recent years, thanks to the concerted efforts of all stakeholders, there has been a consistent increase in both share repurchases and cash dividends. This year alone, almost 300 companies listed on the SSE have disclosed their share repurchase plans, with a maximum planned amount nearing RMB 75 billion. In 2022, cash dividends from SSE listed companies have topped RMB 1.7 trillion, surpassing the combined amount of IPOs, refinancing, and major shareholders' share reductions. Notably, listed companies that have carried out significant share repurchases and offered high cash dividend yields have demonstrated strong stock price performance. These companies serve as crucial "anchors" for long-term, value, and rational investments, and are representative of high-quality listed companies.

The Guidelines for Share Repurchase operate under a framework of guidance and standardization, ensuring that listed companies repurchase their own shares in accordance with the law and regulations. On the one hand, it works to make the process of share repurchases more convenient. It expands and introduces conditions for necessary repurchases to safeguard the company's value and shareholder rights and interests, lifts the ban on repurchase window periods, moderately eases the basic requirements for repurchase of listed companies, refines the restrictions on repurchase transaction declarations, abolishes daily quantity limits on share repurchases, and lowers repurchase thresholds. On the other hand, it further bolsters the restraint mechanism for repurchases. It prompts listed companies to implement mechanism arrangements for repurchases, stating clearly that the Board of Directors should take into account shareholder views and needs when protective repurchases to safeguard company value and shareholder rights and interests become necessary.

Working in tandem with advocacy and regulation, the Guidelines for Standardized Operation steer listed companies to distribute dividends actively and sensibly. On the one hand, it puts greater emphasis on the direction of boosting cash dividends. It augments the transparency of information disclosure, instructing companies that do not distribute dividends or distribute less to enhance their dividend payout. It encourages listed companies to increase the frequency of cash dividends when the conditions for profit distribution are met. On the other hand, it presses listed companies to determine dividend plans reasonably. For companies with significant operational risks, high debt to asset ratios, and poor operational cash flow, it imposes restrictions to prevent negative impacts on company operations and debt repayment abilities.

Moving forward, the SSE will diligently implement the principles of the Central Economic Work Conference and the Central Financial Work Conference. Under the unified guidance of the CSRC, the SSE will continue to guide, encourage, and promote more listed companies to tangibly give back to their investors through share repurchases and cash dividends, steadily stabilize investor expectations, and foster the sound development of the capital market.