6 New Developments in China’s Philanthropy Sector

IIE East Asia is pursuing a number of initiatives to support and engage with Greater China’s developing philanthropy sector. In Hong Kong the sector is mature and provides many opportunities for IIE—which has offices in both Hong Kong and Beijing—to support foundation work in throughout China. The philanthropy sector in the mainland is young but growing fast, and IIE is constantly developing new initiatives to address the needs of this burgeoning sector. Our work with the Ford Foundation under the Learning Circles for Chinese Philanthropy program has allowed us to identify a number of areas where we can support the sector drawing on the resources from both our offices. Below, Siusie Hsiao in IIE’s office in Beijing gives an overview of these key areas. We are very grateful to the Ford Foundation for supporting our work in this area. In due course we will also provide a view from Hong Kong showing how efforts across the region can be harmonized.

  1. In November of last year, six leading philanthropists from Chinese and American organizations including the China Philanthropy Research Institute of Beijing Normal University, the Dunhe Foundation, the Lao Niu Foundation, Beijing Qiaonv Charity, the Bill and Melinda Gates Foundation and the Dalio Foundation established the China Global Philanthropy Institute. The new institute aims to enhance charity and foundation education and training while spreading knowledge throughout this burgeoning sector. As China’s first international philanthropy institute, it demonstrates that Chinese philanthropy is a player in the field and ready to link with the rest of the world. New Chinese philanthropists are also interested in building the capacity of non-profits and learning from western foundations and other related organizations. Because activity in this area has intensified, the face of Chinese Philanthropy has vastly changed in the past five years.
  2. Increased awareness of the specialized management of nonprofit organizations and the value of forming social networks in business has made learning in a professional and organized way a priority for China’s philanthropy sector. For instance, family foundations such as the Lao Niu Foundation and the Shaanxi Ronghua Charity Foundation focus on the sustainability of wealth inheritance; the Universities’ foundations are eager to develop capacity in fundraising; and corporate philanthropy is increasingly directed towards corporate social responsibility in China and overseas. For example, Hainan Group CO., LTD works with WFP to provide free lunches for Ghanaian schools; the China Foundation for Poverty Alleviation opened overseas office in Burma to run scholarships for local students.
  3. Compared to the non-profit market in the United States, Chinese philanthropy still has some way to go in regard to allocating labor, resources and evaluation techniques. The sector still relies on third-party services in finance, consulting, law, fundraising, public relations and communications. It is also learning from its mistakes: when in 2008 a large earthquake shook SW China in seeking to provide support some CSR efforts were also accused of burnishing their companies’ image with as much attention paid to social media as to practical support. Now philanthropists and CSR departments are keener on, for example, designing a sustainable plan for famers to develop local business rather than give high profile donations. They are also learning to value transparency as a means of best allocating resources.
  4. Another issue facing China’s philanthropy sector is finding, training and retaining good staff. Job turnover is high and salary levels are low with almost 40% being on incomes below 3000 RMB (450 USD) per month. China needs to build a healthy philanthropy ecosystem, protect the basic interest of beneficiaries and practitioners, raise public consciousness and rational knowledge, and promote more effective policy making. In recent years the Chinese government has released two China Charity-related drafts for public consultation showing a positive and supportive attitude. Some Chinese leading institutes already play a role as policy advocators and reformers.
  5. The fourth China Charity Fair on September 2015 set an exciting new tone for Chinese Philanthropy. The event was co-hosted by the Ministry of Civil Affairs of PRC, People’s Government of Guangdong Province and the Shenzhen China Charity Alliance. Over 2,500 exhibitors from China and abroad attended, making the fair three times bigger than the first event, which was held three years ago, and 623 public welfare projects raised 12 billion RMB for their initiatives. Established as the first international event to raise funding, the China Charity Fair was also the platform for launching China’s first set of social enterprise certification standards. Furthermore “Internet + Community” emerged as a bright spot among various activities such as internet crowdfunding, new media and on line fundraising.
  6. Capacity building, good stewardship of resources, professionalization and strategic planning are key to keeping the momentum going within the China Philanthropy Sector. This nascent sector also poses challenges and opportunities to western organizations, whether the organizations are bringing money and relief goods, training opportunities or advanced technology and ideas. Those leading Chinese NGOs and philanthropists also face challenges when participating in more international engagement or when they are working together to help NGOs and philanthropists to localize; and finally, challenges arise depending on if NGOs and philanthropists are seen as potential sponsors or beneficiaries. We believe that with China’s rapid economic growth and rising social consciousness, there are a variety of possible models for engagement going forward (especially models that allow for differences in culture policy and vision). The China’s Philanthropy Sector is here to stay and stands as a good example of the exciting philanthropic activity taking hold in our new global economy.