The 267 prelates attending the meet had been tasked with finding a way to breathe fresh life into a centuries-old institution suffering from both a damaging global sex abuse crisis and widespread secularity in the West.
The bishops will take part in a month-long meeting, known as a synod, that starts on Wednesday to discuss the role of young people in the 1.2 billion-member Church.
A Chinese Foreign Ministry spokesman said China was sincere about wanting better relations with the Vatican and that the bishops' agreement was an important step forward.
New bishops will be proposed by members of local Catholic communities together with Chinese authorities, and the names of candidates sent to the Vatican.
A Vatican statement says it is 'not political but pastoral'.
The royal commission, which heard horrific stories during often emotionally exhausting public and private hearings, delivered its final report in December.
The pontiff wrote in a letter released to media by the Chilean Church that the steps taken at a conclave last week were "realistic and concrete" and that he was confident they would make a "decisive" difference.
The Vatican and China are in advanced talks to resolve a dispute over the appointment of bishops in China, one of the biggest obstacles to resuming diplomatic ties that were cut almost 70 years ago.
Nicaraguan bishops met embattled president Daniel Ortega on Thursday, presenting a proposal for what they called "democratization" of the country after weeks of protests.
Malaysian bishops conference gives thanks for a peaceful general election.
Some senior Catholic clergy and Vatican officials have been urging groups of restive Hong Kong brethren in recent weeks to back a deal many fear will betray the so-called "underground" mainland Catholics that they have been supporting for years.
Some retired Vatican officials have been known to want to stay close to the centre of power, to try to influence Church decisions via younger staff allied with them.