The principle of giving priority to the interests of fund share holders is the legal basic principle of internal governance of fund managers. When the interests of fund managers and their employees conflict with those of fund share holders, the interests of fund share holders should be given priority.

A good internal governance structure is a necessary condition to ensure the stable operation of publicly raised funds and protect the interests of fund share holders. Fund managers of publicly offered funds shall establish a good internal governance structure, clarify the rights and responsibilities of shareholders' meeting, board of directors, board of supervisors and senior managers, and ensure the independent operation of fund managers.

The shareholders and actual controllers of the fund manager shall fulfill the obligation of reporting major events in a timely manner in accordance with the provisions of the China Securities Regulatory Commission.

In order to enhance the risk prevention ability of fund managers and protect the interests of fund share holders, fund managers should establish a risk reserve system according to law. According to the provisions of the Securities Investment Fund Law, fund managers who publicly raise funds should accrue risk reserves from the remuneration of managing funds.