AS China continues to mesmerise a growing number of investors on both sides of the Pacific with its big growth story, London brokers are looking a little harder to find the Emperor's new clothes. Their caution is in marked contrast to those who have been prepared to take at face value the euphoric reaction to the H shares issued by mainland companies, and their immediate potential. They want to know more about the real value of these companies, and are prepared to stand back if H-share companies do not comply with stringent auditing and listing standards. A fair enough view, when you are dealing with someone else's money. Yes, China has 1.1 billion people. Yes, its purchasing power has gone up. And yes, its economic growth and growth potential are unmatched elsewhere in the world. The statistics to back up the big economic story are, by any standards, simply stunning. Yet there is no running away from the fact that as China increasingly turns to the international capital markets for funds, it has to show more than just a commitment to higher disclosure and accounting standards. To investors, a commitment unmatched by deeds is totally meaningless and, worse, can do enormous harm to China's grand plan to tap foreign funds to invigorate the state sector - a linchpin in its economic reforms. Just recall the furore Tsingtao Brewery stirred up several months ago when it failed to deliver its interim result shortly after its listing in Hong Kong. Tsingtao could well argue that it did not break any rules - and nor did it. But the episode remains fresh in many investors' mind - as recent views coming out of London have shown. The Chinese companies chosen for listing by the China Securities Regulatory Commission (CSRC) are supposed to be among the best of China's corporations. If they do not set the standards, there is little reason for investors to believe that future batches of companies seeking listings overseas will do more. It would be unfortunate if China's experiment to list its best-run corporations overseas was tainted by a neglect, or ignorance of, investors' interests and protection. The CSRC will do itself and China a big favour if it insists that corporations listing overseas more than abide by the standards expected of them abroad. It is to be hoped that Liu Hongru, the CSRC chairman, absorbed the message in London.