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Guidelines aim to keep tabs on controlling shareholders

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China has issued a new set of guidelines on corporate governance to improve the quality of listed companies.

The guidelines, published by the China Securities Regulatory Commission (CSRC) and the State Economic and Trade Commission, prohibit controlling shareholders from intervening in the operations and decision-making of listed companies.

'Controlling shareholders are not allowed to directly or indirectly intervene in listed companies' policy-making and production operations,' the CSRC said in an announcement on its Web site.

They are also not allowed to intervene in the companies' finance and accounting exercises.

The guidelines were promulgated following last year's public consultation for the draft version.

They come after a series of tightened requirements made by the regulators in the past year in a bid to help promote sound operations of listed companies and ensure fair treatment of minority shareholders and foreign investors.

Of the more than 1,100 companies listed on the Shenzhen and Shanghai exchanges, more than 40 per cent of their shares on average are estimated to be held by their largest shareholder.

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