Liu Jipeng: A-shares has created 5,000-6,000 listed companies in 30 years, while the US took 200 years to reach 6,000 - delisting efforts must be significantly increased

Special Topic: Strengthening the Defense Line for the Rights and Interests of Small and Medium Investors — Sina Finance 3.15 Investor Protection Forum

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On March 13, Sina Finance held the 3.15 Investor Protection Forum. Liu Jipeng, Professor at the Business School of China University of Political Science and Law and a well-known expert in the capital market, delivered a keynote speech. Liu stated that over the past 30 years, the A-share market has produced five to six thousand listed companies, while it took the U.S. 200 years to reach the same number. The力度 of delisting must be increased.

However, ensuring the smooth implementation of the delisting system relies heavily on establishing and improving the investor compensation system.

So, where does the funding for the compensation system come from? Liu Jipeng offered two suggestions: first, whether a dedicated compensation fund can be established specifically to compensate harmed small and medium investors; second, it is essential to hold “malefactors” accountable to ensure that compensation is truly implemented.

Who are the real “malefactors”? Liu Jipeng clearly pointed out that the primary culprits are the major shareholders and actual controllers of listed companies. Next are third-party intermediary agencies playing the role of “accomplices”—including accountants, lawyers, appraisers, etc. He noted that without the cooperation and endorsement of these “third parties,” financial fraud would be difficult to carry out, and false statements would be hard to gain market acceptance. Therefore, the responsibility for compensation must be traced back to these two main sources.

He cited the regulatory practices in the U.S. as an example, noting that the SEC once heavily penalized top accounting firms like Arthur Andersen, ultimately leading to their exit from the market. China has also had relevant cases involving broker penalties, but the力度 still needs to be strengthened and increased. Liu emphasized that at the very least, accountability should be pursued to recover some of the investors’ losses.

Additionally, he mentioned the experience of the Indian market. India’s stock market has performed remarkably well in recent years, which is closely related to its strict delisting penalty mechanisms. In India, delisting is not simply a matter of one withdrawal; regulators conduct comprehensive inspections and asset revaluations before delisting, and main malefactors are required to bear unlimited liability. As a result, few companies dare to delist as easily as in the Chinese market.

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Editor: Chang Fuqiang