Several listed companies have recently announced plans to seek shareholder approval for their boards to formulate mid-term dividend distributions for the year 2026. Among them, Shantui Construction Machinery Co., Ltd. disclosed on the evening of March 15 that it will propose such an authorization at its upcoming general meeting of shareholders.
A review of corporate announcements reveals that a growing number of firms are making similar moves, with many explicitly stating that the purpose of planning mid-term dividends is to reward investors.
According to Bao Jingang, a fund manager and senior researcher at Shenzhen Rongzhi Private Securities Investment Fund Management Co., Ltd., listed companies have shown positive changes in recent years in returning profits to shareholders through dividends. Not only have the scale and quality of dividends improved, but their structure has also been continuously optimized. Moreover, cash returns are gradually becoming a consensus, with increasingly evident positive impacts on the A-share market ecosystem.
Yuan Huaming, general manager of Guangdong Huahui Chuangfu Investment Management Co., Ltd., noted that emphasizing dividend payouts helps attract long-term capital while reducing speculative behavior in the market. Focusing on investor returns can also encourage listed companies to improve operational quality, fostering a virtuous cycle of development.
From a corporate governance perspective, increasing the frequency and proportion of dividends has become a common practice among well-performing and steadily operated listed companies to convey confidence in their performance and shorten the return cycle for investors.
Additionally, many companies are incorporating dividend distributions into their annual planning as an institutionalized arrangement. Yuan Huaming suggested that listed companies could further enhance the transparency of their dividend policies to help small and medium-sized investors form stable expectations regarding returns.
Bao Jingang proposed several measures to improve the effectiveness of cash dividends in rewarding investors. These include refining systems and information disclosure requirements, specifying dividend policy disclosures, and requiring non-dividend-paying companies to provide adequate explanations to foster stable and transparent dividend expectations. He also recommended optimizing market evaluation systems by increasing the weight of dividends in various assessment guidelines and penalizing companies that refrain from paying dividends over the long term to encourage regular returns. Lastly, he emphasized coordinating dividends with share buybacks, standardizing the use and disclosure of repurchases, to ensure that capital return activities genuinely benefit shareholders and enhance corporate value.
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