China’s fund industry is reshaping and reforming in a move that has received little coverage outside its borders. The China Securities Regulatory Commission (CSRC), came out with a statement earlier this month—inaugurating the first fund management institution, The China Securities Investment Funds Association. So, what are the implications for the fund industry and strategic communications?
The China Investment Funds Association will be responsible for regulating wealth management funds in China, signalling its intent to develop the market. The industry is known for lacking standards and processes unlike many global peers. There are also issues around the China fund industry being highly fragmented with questions over profitability.
According to Guo Shuqing, chairman of the CSRC, “China’s industrial restructuring calls for the rapid development of professional wealth management services to pool private funds and channels them into the ‘real economy’.”
The wealth management sector in China, while still in its infancy stage, has gained considerable traction in the last few years and has often been referred to as a “sunrise industry”. With an eye on its Western peers, the CSRC is sending a strong message that it has high ambitions for the domestic industry. As the industry transforms, there will be increasing needs to ensure that brand positioning, including messaging and stakeholder engagement, is executed in a strategic manner. This, in turn, will support the development of financial services communication in mainland China.