China strengthens mutual fund rules to improve accuracy, reduce style drift, and boost long-term investing.

China’s securities regulator has introduced new rules to strengthen mutual fund performance benchmarks, aiming to improve fund accuracy, reduce style drift, and attract long-term capital. The China Securities Regulatory Commission (CSRC) requires benchmarks to reflect a fund’s true investment style, limits frequent changes, and ties manager pay to long-term results—cutting bonuses for underperformance exceeding 10 percentage points over three years. A one-year rollout allows gradual adjustments. The reform addresses past benchmark mismatches, especially in equity funds, enhancing transparency and investor protection. It supports broader efforts to build a higher-quality fund industry.