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(Hong Kong and Shantou, 23 March 2004) Corporate governance is taking shape and is gaining its footing in China's business sector, Mrs Laura Cha, Vice-Chairman of the China Securities Regulatory Commission (CSRC), told senior executives of Citigroup in Hong Kong and law students of Shantou University (STU) in Shantou today.

Mrs Cha, who kicked off the Shantou University Law School Corporate Governance Speaker Series, also shared with the audience her optimism about the development of corporate governance in the Mainland.

This speaker series on corporate governance, sponsored by Citigroup and supported by the Li Ka Shing Foundation, is the first of its kind coordinated by Ms Anna Wu, Advisor to the Law School of STU, to bring knowledge and appreciation of good practices to the students and to enrich their learning. In recent years, STU has successfully implemented a number of reform measures to create a more dynamic and student-centered learning environment and is the only university in Southern Mainland China to have gained financial support from Citigroup.

Mrs Cha delivered her speech in Hong Kong, which was transmitted simultaneously to Shantou through the Internet, a fitting tribute to the state of technology and the globalised nature of the present environment.

Mrs Cha said corporate governance was a global issue, as the protection for investors and shareholders had become a universal concern nowadays.

She said the Chinese capital market was developed during the Country's transition from a planned economy to a market economy. With its short history, it was an emerging market, with features of a transition economy and exhibited some concomitant deficiencies. Corporate governance reform in China therefore had to take into account the particular nature and stage of development of the market, as well as its peculiarities.

"As a proactive regulator, CSRC has undertaken a considerable number of initiatives to advocate and promote corporate governance, as well as building the framework and principles for the establishment of a good corporate governance structure in the Chinese market," Mrs Cha said.

These initiatives included, among others, regulating the behaviour of controlling shareholders, setting up an independent directors system, strengthening information dissemination, promulgating a Code of Corporate Governance for Listed Companies in China, and facilitating reforms of the legal and accounting systems.

"CSRC will consolidate the work it has done in the past, and continue to vigorously strengthen corporate governance in Chinese companies in order to improve the quality of our market and to protect the legitimate interests of investors," she said.

STU President Professor Xu Xiaohu said, "Citigroup's sponsorship of this prestigious event represented a fitting recognition of the university's remarkable progress in recent years."

Apart from the speaker series, which will feature other prominent speakers in the months to come, Citigroup has provided one freshman scholarship and 10 summer internship scholarships for placement in Hong Kong for the STU Law School. Citigroup is also supporting the development of a training module on dispute resolution and negotiation skills by the Law School.

Last October, Citigroup also invited and sponsored four business students of STU to attend the first international university case competition in Hong Kong.

"Citigroup's support has enriched our teaching and widened our students' horizon. It supports STU's goal of developing into a modern and unique tertiary education institution. It also enhances the collaboration between the community and the business sector in China," Professor Xu said.

"We are pleased to be able to support the development of best practices in corporate governance through this speaker series at Shantou University," said Mrs Catherine Weir, Citigroup Country Officer, Hong Kong. "We hope to bring some of the best policy makers and practitioners in the field to the Shantou students to grow their understanding and to encourage transparency and fairness in the expanding capital and business markets of China.

"Mrs Laura Cha is an excellent choice for our inaugural speaker, and we are appreciative. Her experience is not only at senior levels of China policy, but also based in Hong Kong, which continues to be the financial services centre of China," Mrs Weir said.

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Photo captions

Download (154 KB) 1. Mrs Laura Cha, Vice-Chairman of the China Securities Regulatory Commission, shares her views on corporate governance in the Mainland with Shantou University law students through the Internet.

Download (245 KB) 2. Mrs Laura Cha (centre), Mrs Catherine Weir, Citigroup Country Officer, Hong Kong (right) and Ms Anna Wu, Advisor to the Law School of Shantou University (STU) at the STU Law School Corporate Governance Speaker Series.

About Shantou University

Shantou University is the only general university in the southeastern coastal city of Shantou in Mainland China, which boasts a population of 10 million. The university, with a total of 7,000 registered students, a medical college and five affiliated teaching hospitals, is a key project for the Li Ka Shing Foundation. The Law School is one of the university's major areas of academic development.

About Li Ka Shing Foundation

The Li Ka Shing Foundation was formed in 1980 by internationally renowned entrepreneur Mr Li Ka-shing to promote the development of education and health care. Since then, more than US$640 million has been donated.

For more information, please visit LKSF website: www.lksf.org

About Citigroup

Citigroup (NYSE: C), the preeminent global financial services company with some 200 million customer accounts in more than 100 countries, provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, insurance, securities brokerage, and asset management. Major brand names under Citigroup's trademark red umbrella include Citibank, CitiFinancial, Primerica, Smith Barney, Banamex, and Travelers Life and Annuity. The Citigroup Foundation primarily focuses its grant making in three areas: financial education, educating the next generation, and building communities and entrepreneurs.

Additional information may be found at: www.citigroup.com.