Proposal on Launching the "Corporate Value and Return Enhancement" 2.0 Special Action for SSE-Listed Companies

Shang Zheng Fa [2026] No. 68

To All Companies Listed on the Shanghai Stock Exchange:

In early 2024, the Shanghai Stock Exchange (hereinafter, the "SSE") issued a proposal for the "Corporate Value and Return Enhancement" Special Action Initiative to SSE-listed companies. Nearly 80% companies actively responded to date, and the initiative has yielded positive results. To thoroughly implement the guiding principles of the 20th National Congress of the Communist Party of China and the Central Financial Work Conference, to continue fulfilling the relevant requirements of the of the State Council's Opinions on Further Improving the Quality of Listed Companies and the Guidelines on Strengthening Regulation, Forestalling Risks, and Promoting High-Quality Development of the Capital Market, to consolidate and deepen the achievements of the "Corporate Value and Return Enhancement" Special Action, to vigorously cultivate a group of high-quality listed companies, to effectively enhance investors' sense of gain, to solidify the foundation for stable operation of the capital market, and to better serve new quality productive forces and high-quality economic development, we hereby propose that SSE-listed companies launch the "Corporate Value and Return Enhancement" 2.0 Special Action.

I. Background of the New Round of Initiative

Since 2024, SSE-listed companies have actively responded to the "Corporate Value and Return Enhancement" Special Action Initiative by formulating and disclosing their special action plans, and have achieved phased results in improving business quality, increasing investor returns, and enhancing investor communication. At the same time, it should be noted that for some companies, there remains a gap between their action plans and both investor expectations and the requirements for high-quality development.

Currently, China's economy has entered a stage of high-quality development, and the role and significance of the capital market in the national economy have become increasingly prominent. As the cornerstone of the capital market, the development quality of listed companies has a direct bearing on the sound operation of the capital market and the vital interests of investors. To further advance the "Corporate Value and Return Enhancement" Special Action in depth and substance, we propose that listed companies, on a voluntary and pragmatic basis, focus on five core areas—business development, corporate governance, information disclosure, investor returns, and social responsibility—quantify objectives, refine measures, and strengthen execution, so as to steadily enhance the quality and investment value of listed companies through tangible business performance and investor returns, and demonstrate their responsibility and commitment.

II. Main Contents

The core of deepening the "Corporate Value and Return Enhancement" Special Action is to ensure that the action plans are implemented in a detailed, meticulous, and effective manner. Each listed company should, in light of its actual circumstances, comprehensively assess its development status, conduct in-depth analysis of existing problems, define specific improvement targets, break down and implement work tasks, and strive to deliver continuously improving business data and satisfactory investor returns as its answer sheet, truly becoming a pacesetter in the high-quality development of the real economy and the capital market.

(I) Enhancing the Quality and Efficiency of Business Operations and Development

Listed companies shall conduct a quantitative assessment of the quality and efficiency of their business operations and development from both organic and inorganic perspectives, comprehensively analyze the current state of profitability or business quality and the internal and external issues they face, and propose targeted improvement objectives and measures. On the one hand, each company shall select at least two financial or non-financial indicators that reflect its profitability or business quality in its action plan (such as return on equity, gross margin, performance growth rate, R&D milestones or progress, or other self-selected indicators that the company considers more representative of its characteristics), quantitatively analyze the current status of its profitability or business quality, the reasons for fluctuations in the relevant indicators or significant discrepancies compared with industry peers, define the development direction and goals for a future period such as 1 to 3 years, and propose targeted improvement plans and operational measures. On the other hand, for outstanding issues such as a continuously rising proportion of accounts receivable, relatively high asset-liability ratios, and unresolved horizontal competition problems in certain companies, the relevant companies shall make full use of the capital market toolkit, accelerate the development of new quality productive forces and resolve horizontal competition issues through mergers, acquisitions and restructuring, optimize their asset-liability structure through refinancing, and improve the efficiency of capital utilization and turnover through refined management.

(II) Enhancing the Quality and Efficiency of Corporate Governance

Sound corporate governance is the foundation for the high-quality development of listed companies. Controlling shareholders, actual controllers, directors, and senior management members of listed companies shall act with honesty and integrity, exercise diligence and due care, continuously raise their awareness of capital market compliance, support and promote listed companies in enhancing information disclosure transparency and operational efficiency, and shall not exploit their controlling or advantageous positions to harm the interests of listed companies or seek illegal gains, and shall resolutely prohibit directing or using listed companies to engage in financial fraud, capital occupation, irregular guarantees, concept speculation, or other violations of laws and regulations. Corporate governance of listed companies shall be sound, effective, and transparent. Each company shall continuously refine its internal governance mechanism featuring proper positioning and diligent performance of duties by all parties and effective checks and balances, steadily enhance its governance level and standardized operation capability, and fully maintain independence. Companies experiencing non-operational capital occupation by controlling shareholders, modified audit opinions, or similar situations shall conduct in-depth analysis of the root causes, take effective measures for rectification and implementation, and strictly prevent the recurrence of similar problems. Each company shall keep abreast of the latest developments in laws, regulations, and self-regulatory rules, adjust or increase professional staffing as appropriate, organize annual compliance training for "key minority" personnel such as controlling shareholders, actual controllers, directors, and senior management members, as well as relevant personnel, and conduct thorough research and communication when making decisions on major matters such as production and operations, related party transactions, investments, and mergers and acquisitions, thereby enhancing the scientific and prudent nature of decision-making.

(III) Enhancing the Quality and Efficiency of Information Disclosure

Information disclosure is the core basis for investors' value judgment and investment decisions. Each company shall transform its information disclosure philosophy, shifting from "formal completeness" to "substantive effectiveness", and continuously improve the quality of information disclosure. On the one hand, companies shall standardize the information release mechanisms for non-statutory information disclosure channels such as official websites and WeChat official accounts, strictly review and control voluntary disclosure content, and guard against being actively or passively drawn into speculation on hot concepts. On the other hand, companies are encouraged to establish an internal accountability mechanism for information disclosure errors, analyze the causes of errors in periodic reports and propose improvement measures; diversify the forms of information disclosure by using visual methods such as presentation meetings, graphic briefings, and short videos to interpret periodic reports and interim announcements, thereby enhancing the readability and usefulness of disclosure documents and helping investors better understand the company's business conditions and development strategies.

(IV) Enhancing the Quality and Efficiency of Investor Returns

Returning value to investors is a bounden duty of listed companies. Each company shall earnestly assume the primary responsibility for enhancing its own investment value and returning value to investors, and continuously strengthen investors' sense of gain. Companies are encouraged to: First, based on their own capital utilization arrangements and business development needs, formulate and refine medium- and long-term dividend distribution plans, reasonably increase the dividend payout ratio and the frequency of cash dividends on the basis of "acting within their capacity", and stabilize investors' dividend expectations. Second, use share repurchases and shareholding increases by major shareholders as important tools for market value management, actively carry out share repurchases and implement cancellation of repurchased shares, and guide controlling shareholders, actual controllers, directors, and senior management members to convey confidence to the market through shareholding increases or commitments not to reduce shareholdings. Third, continuously enrich investor communication methods, formulate and disclose annual plans for investor communication, specify the frequency and specific arrangements of various activities such as results briefings, visits to listed companies, "cloud tours", and investor symposiums, and require key responsible persons such as the company's chairman and general manager to actively participate in shareholders' meetings, results briefings, and related activities. Fourth, establish a mechanism for soliciting and responding to investor opinions, proactively, promptly, and thoroughly understand investor demands and make targeted responses.

(V) Enhancing the Quality and Efficiency of Social Responsibility

Fulfilling social responsibility is an inherent requirement for listed companies to achieve sustainable development. Each company shall actively practice the new development philosophy, proactively assume social responsibility, and promote sustainable economic and social development. Companies are encouraged to further enhance the willingness and quality of ESG report disclosure, proactively specify in their special action plans whether to disclose ESG reports, and, in accordance with the materiality principle, identify and analyze relevant ESG issues, objectively and truthfully reflect the company's practices and achievements in environmental, social, and governance aspects, and continuously improve the standard of report preparation.

III. Relevant Requirements

(I) Scope of Application

All SSE-listed companies are encouraged to actively participate in the "Corporate Value and Return Enhancement" 2.0 Special Action, and further deepen and enhance the quality and efficiency in areas such as business development, corporate governance, information disclosure, investor returns, and social responsibility. It is recommended that constituent companies of the SSE 50, SSE 180, STAR 50, and STAR 100 indices, as well as companies that have maintained a Class A information disclosure rating for consecutive years, actively participate and play a leading and exemplary role. Companies with relevant capabilities are encouraged to concurrently release an English version of the action plan, so as to effectively communicate with domestic and overseas investors. Companies that have already disclosed their 2026 annual action plan may deepen the action plan in the following year, or may choose to update and disclose it in due course.

(II) Deliberation Procedures

The board of directors of a company shall, based on a comprehensive analysis of the company's operations, financials, governance, and investor returns, objectively discuss existing problems and obstacles in conjunction with the selected improvement indicators, propose targeted, quantifiable measures, development directions, and risk factors, and formulate the "Corporate Value and Return Enhancement" Action Plan, which shall be submitted to the board of directors for deliberation and disclosure as a separate proposal.

(III) Disclosure Requirements

The disclosure of the action plan by a listed company falls within the scope of voluntary information disclosure. Companies shall comply with the general provisions of laws, regulations, and self-regulatory rules regarding the truthfulness, accuracy, completeness, conciseness, clarity, and comprehensibility of information disclosure. The disclosed content and measures shall be specific, quantifiable, measurable, and actionable, and shall not contain expressions that may cause ambiguity, misinterpretation, or exaggeration. Companies shall not use the disclosure of the action plan to unduly influence the stock trading price, engage in insider trading, or commit other violations of laws and regulations.

(IV) Evaluation and Refinement

Companies shall evaluate the implementation of the action plan on a semi-annual basis, describing the effectiveness of the relevant measures, existing problems and improvement actions, as well as investors' opinions and suggestions for improving the action plan, and shall disclose the evaluation after deliberation by the board of directors in the form of an interim announcement, a separate section of a periodic report, or a combined compilation with the new round action plan. During the implementation of the plan, if material changes necessitate corresponding adjustments to the plan, the company shall promptly update the action plan, provide appropriate explanations, and disclose in accordance with regulations.

In respect of this special initiative, the SSE will simultaneously issue a model text for deepening the special action plan along with this proposal, providing a reference for listed companies in formulating their plans. The SSE will also conduct specialized training, promote model cases, and carry out tracking and evaluation, thereby optimizing regulatory services and creating a favorable environment for listed companies to carry out the special initiative. Furthermore, the SSE advocates that all investors actively practice the principles of rational investment, value investment, and long-term investment, and pay greater attention to listed companies that are well-regulated, of superior quality, responsible, and focused on investor returns, jointly promoting the high-quality development of SSE-listed companies.

Shanghai Stock Exchange

June 23, 2026