LONDON and Shanghai are partners in a deal that covers cooperation between the two major cities.

London's Lord Mayor John Stuttard arrived in Shanghai yesterday with a delegation of 50 senior representatives of British financial and legal firms.

First on his agenda in the city was a meeting with Vice Mayor Tang Dengjie in the City Hall yesterday afternoon when the two sides signed a memorandum of understanding between Shanghai and the City of London.

The three-year memorandum which runs from 2008 to 2010 involves cooperation in legislation and professional training to help overcome problems that Shanghai might face as it builds itself into an international financial center.

"Education and training are the keys to a successful financial center. Britain has a long history with Shanghai but we need more cooperation to training more professionals," said Stuttard, who spent five years as the former chairman of PwC in China.

During his visit yesterday, Stuttard delivered a speech about "the importance of professionalism and ethics in accounting profession" at a seminar held by the Association of Chartered Certified Accountants.

The Lord Mayor talked about several cases involving ethics in the UK and the US and warned that countries should not rush into legislation or political over-reaction if they encountered an ethical crisis in business. Instead, business codes and guidelines in corporate management are needed.

"I do suggest people who want to become accountants think carefully about ethics, independence and how to identify risks," he told the ACCA seminar.

Stuttard is scheduled to attend other seminars on business and law before concluding his visit to Shanghai on Sunday.

Before arriving in Shanghai, the Lord Mayor visited Hong Kong and Nanjing. He will meet senior financial sector officials in Beijing and Tianjin next week.