Core Viewpoint - The newly revised "Corporate Governance Guidelines" by the China Securities Regulatory Commission aims to enhance the regulatory framework for directors and senior management, effective from January 1, 2026, focusing on aligning compensation with company performance and individual contributions [1][5]. Group 1: Improvement of Director and Senior Management Regulation - The first major focus of the revised guidelines is to enhance the regulatory framework for directors and senior management, covering aspects of appointment, performance, and departure [2][3]. - The guidelines require detailed disclosure of director candidates' information before shareholder meetings, ensuring transparency and informed decision-making by shareholders [2]. - Directors are mandated to report any conflicts of interest and must provide justifications for decisions that may benefit themselves or others, thereby preventing conflicts between personal and company interests [2][3]. Group 2: Management of Departures - The guidelines stipulate that departing directors must complete all work handover procedures and remain accountable for responsibilities incurred during their tenure [3]. - Companies are required to conduct reviews of departing directors for any unfulfilled obligations or potential legal violations [3]. - The appointment of senior management must adhere strictly to legal regulations and company bylaws, preventing interference from controlling shareholders [3]. Group 3: Alignment of Compensation with Performance - A significant highlight of the revised guidelines is the establishment of a compensation management system that aligns the remuneration of directors and senior management with company and individual performance [5][7]. - If a company transitions from profit to loss or experiences a larger loss compared to the previous fiscal year, the average performance-based compensation for directors and senior management must be adjusted accordingly, with reasons for any discrepancies required to be disclosed [6]. - Special compensation mechanisms may be applied for R&D companies that are initially unprofitable or for top-tier talent, allowing for flexibility in performance linkage [6]. Group 4: Long-term Impact on Corporate Governance - The guidelines are expected to create a closed-loop regulatory system that enhances decision-making transparency and encourages long-term strategic planning among management [4][7]. - By binding compensation to performance, the guidelines aim to correct past imbalances and foster a culture of shared risk and reward, ultimately attracting long-term investment and enhancing market stability [7].

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has revised the Corporate Governance Guidelines for listed companies, effective from January 1, 2026, to enhance governance standards and mitigate risks in the capital market [1][2] Summary by Relevant Sections Governance Structure - The revised guidelines aim to improve the regulatory framework for directors and senior management, covering aspects from appointment to performance and departure, ensuring they fulfill their duties diligently and faithfully [1] Incentive and Restraint Mechanisms - Companies are required to establish a compensation management system that aligns the remuneration of directors and senior executives with the company's operational performance and individual achievements, promoting better alignment of interests [1] Shareholder and Control Behavior - The guidelines impose stricter regulations on controlling shareholders and actual controllers, particularly regarding competition that could adversely affect the listed company, and enhance the responsibilities and decision-making requirements for related party transactions [1] Coordination with Other Regulations - The guidelines will be aligned with existing laws such as the Securities Law and the Management Measures for Independent Directors of Listed Companies, improving the coordination of rules related to shareholder rights and the responsibilities of board committees [1][2]

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has revised the Corporate Governance Guidelines, effective from January 1, 2026, aiming to enhance the governance standards of listed companies and align with national policies for risk prevention and high-quality capital market development [1][2] Group 1: Key Aspects of the Revision - The revision includes a comprehensive regulation of directors and senior management, covering their appointment, performance, and departure to ensure they fulfill their duties faithfully and diligently [1] - It establishes an incentive and restraint mechanism for directors and senior management, requiring listed companies to create a compensation management system that aligns their pay with company performance and individual achievements [1] - The guidelines impose stricter regulations on controlling shareholders and actual controllers, limiting significant adverse impacts from competition and refining the responsibilities and decision-making processes for related party transactions [1] - The revision aims to enhance coordination with other regulations, improving the clarity of shareholder rights and the responsibilities of the board's nomination and compensation committees [1]

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has revised the "Corporate Governance Guidelines for Listed Companies," which will take effect on January 1, 2026, aiming to enhance the governance of listed companies and protect the interests of minority shareholders [1] Group 1: Key Revisions - The new guidelines establish a comprehensive regulatory framework for directors and senior management, including strict qualification checks and enhanced disclosure requirements regarding conflicts of interest [2] - A balanced incentive and restraint mechanism is mandated, linking executive compensation to company performance and encouraging deferred payment and clawback mechanisms to align management interests with long-term company goals [3] - The guidelines impose stricter regulations on controlling shareholders and actual controllers, particularly regarding related party transactions and competition, to prevent detrimental impacts on listed companies [4] - The new rules ensure coherence with existing laws, enhancing the overall regulatory framework and clarifying responsibilities related to shareholder rights and board committee functions [5] Group 2: Implementation and Feedback - The CSRC solicited public opinions from July 25 to August 24, 2025, receiving 195 suggestions, which were largely supportive of the revisions, leading to the incorporation of several reasonable recommendations in the final draft [6] - The implementation date of January 1, 2026, provides listed companies ample time to adjust their internal systems in line with the new guidelines, facilitating a smooth transition [6] - The revisions are seen as a significant step towards improving the modern corporate governance system in China and promoting high-quality development in the capital market [6]

Core Points - The China Securities Regulatory Commission (CSRC) announced the revision of the Corporate Governance Guidelines, effective from January 1, 2026 [1] Group 1: Key Revisions - The revision aims to enhance the supervision system for directors and senior management, ensuring they fulfill their duties faithfully and diligently [1] - It establishes an incentive and restraint mechanism for directors and senior management, requiring companies to align their compensation with business and individual performance [1] - The guidelines impose stricter regulations on controlling shareholders and actual controllers, limiting actions that could adversely affect the company, such as significant competition and related party transactions [1] - The revision ensures better coordination with existing regulations, including the Securities Law and the Independent Director Management Measures [1] Group 2: Implementation and Feedback - The CSRC previously solicited public opinions on the guidelines, receiving overall positive feedback on the direction and content of the revisions [1] - The CSRC has carefully considered and incorporated feedback into the final rules [1] - Future efforts will focus on implementing the guidelines and promoting the continuous improvement of corporate governance among listed companies [1]

Core Viewpoint - The China Securities Regulatory Commission (CSRC) is revising the Corporate Governance Code to enhance the governance level of listed companies and regulate the behavior of directors, senior management, and controlling shareholders [1][2]. Group 1: Key Aspects of the Revision - The revision aims to improve the regulatory system for directors and senior management, covering their appointment, performance, and departure to ensure they fulfill their duties faithfully and diligently [2]. - It establishes a sound incentive and restraint mechanism for directors and senior management, requiring listed companies to create a compensation management system that aligns their pay with company performance and individual achievements [2]. - The revision also seeks to regulate the behavior of controlling shareholders and actual controllers, imposing strict limitations on potential significant adverse impacts from competition and enhancing responsibilities for related party transactions [2]. - The CSRC emphasizes the need for coordination with other regulations, refining provisions related to shareholder rights, the board nomination committee, and the remuneration and assessment committee to improve rule consistency [2].