China Securities Regulatory Commission recently issued No.3 "Guidelines for Supervision of Listed Companies-Cash Dividends of Listed Companies" and "Decision on Amending Guidelines for Articles of Association of Listed Companies". The main amendments include encouraging cash dividends, simplifying the procedures for mid-term dividends, and strengthening the constraints on enterprises with abnormally high dividends.
This move aims to further improve the normalized dividend mechanism of listed companies and improve the return level of investors. The new regulations encourage companies to increase the frequency of cash dividends, mid-term dividends and cash dividends under the condition of profit distribution, thus improving the expected return on investment. At the same time, in order to prevent the company's future operation from being affected by excessive dividends, the new regulations require the company to formulate dividend restraint clauses in the company's articles of association to ensure that the company's dividend behavior is reasonable and sustainable.
The Effect of New Dividend Rules on Listed Companies
1. Improve the return of investors: The new dividend regulations encourage companies to pay dividends in cash to improve the return of investors, and clarify the dividend policy in the company's articles of association, so that investors can have clear expectations for the company's dividend behavior.
2. Guide the company to pay dividends continuously and stably: The new regulations encourage the company to pay dividends continuously and stably, so as to cultivate the concept of value investment, guide listed companies and investors to pay attention to long-term investment and attract more long-term funds to enter the market.
3. Simplify the interim dividend procedure: The new regulations simplify the interim dividend procedure and encourage companies to increase the dividend frequency, so that investors can get more dividend returns every year and improve their investment income.
4. Prevent abnormally high dividends: The new regulations strengthen the constraints on enterprises with abnormally high dividends, prevent the company from affecting its future operations due to excessive dividends, and ensure that the company's dividend-paying behavior is reasonable and sustainable.
For the above contents, please refer to Baidu Encyclopedia-Guidelines for Supervision of Listed Companies No.3-Cash Dividends of Listed Companies.