THE quality of listed companies is a crucial factor in shaping China's securities sector and attracting investor participation, according to the China Securities Regulatory Commission.
Commission chairman Liu Hongru said: ''When demand of shares outstrips supply, as was the case in the past, the fundamentals of listed companies were of little importance to investors.
''But as securities markets grow, stock investment no longer brings handsome gains. Investors begin to look to the earnings prospect and operations of individual companies.'' Mr Liu was speaking at a three-day seminar on boosting the knowledge of Shenzhen-listed companies on securities regulations.
He told companies in Shanghai two weeks ago to play by the rules and to cut out irregular activities.
In reforming the system of restructuring enterprises to become shareholder companies, it was imperative that the quality of listed companies be raised, he said.
''Issuing shares and then listing them are only the first steps. Changing company structures and accounting systems to meet listing requirements are cosmetic,'' Mr Liu said.
''The content of the restructuring, however, hinges on the switch in operational habits, management structure and compliance standards,'' he said.
