China’s mutual fund industry is undergoing a transformative shift as regulators push for higher quality development, with BOC Fund taking proactive steps to align with new guidelines. The China Securities Regulatory Commission’s (CSRC) May 7 action plan marks a significant turning point, emphasizing investor returns over mere asset accumulation.
Prioritizing Investor Interests Through Structural Reforms
The comprehensive reform package introduces groundbreaking changes to align fund company revenues with investor outcomes. Key measures include:
- Implementation of performance-based variable management fees
- Strengthened benchmark comparison requirements
- Revised disclosure standards for active equity funds
- Systematic reduction of investor costs
BOC Fund has already taken concrete steps by absorbing index licensing fees for all its index funds since March 21, 2025. The company also distributed over 3.6 billion yuan in dividends across 90 instances during 2024, demonstrating its commitment to sharing investment gains.
Fee Structure Overhaul
The reforms specifically target expense reductions for large-scale index funds and money market funds, with BOC Fund positioning itself as an early adopter of these cost-saving initiatives.
Expanding Index Product Offerings
With China’s ETF market surpassing 1,000 products, BOC Fund is accelerating its passive investment strategy in response to regulatory calls for increased equity exposure and stability. Recent launches include:
- BOC CSI 300 Index Fund
- BOC STAR Market 50 ETF
- BOC CSI A500 Enhanced Index Fund
The company plans further expansion in line with national strategic priorities, particularly focusing on science and innovation board products while enhancing coordination between on-exchange and OTC offerings.
Regulatory-Driven Product Innovation
CSRC’s parallel initiative for index investment development has created favorable conditions for BOC Fund’s passive product growth, particularly in specialized sector and thematic funds.
Strengthening Risk Management Frameworks
As China’s mutual fund industry enters its 27th year, BOC Fund is reinforcing its risk controls in accordance with the “Five Dos and Five Don’ts” financial culture principles. The company has:
- Enhanced multi-layered liquidity risk prevention
- Strengthened long-term investment orientation
- Upgraded compliance capabilities
Looking ahead, BOC Fund will focus on building a robust, team-based investment research system while advancing digital transformation and governance improvements. “Our investor-first philosophy remains central as we implement these reforms,” a company representative stated.
Future Development Roadmap
The fund manager plans to continue talent development and multi-strategy implementation while maintaining strict adherence to the new regulatory standards for sustainable industry growth.
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