The Beijing Normal University One Foundation Philanthropy Research Institute, founded in June 2010, is dedicated to conducting research on key social sector related issues. It integrates the academic resources of Beijing Normal University, the One Foundation s grassroots network, and leadership drawn from government and the private sector. The following is a select article taken from the 2010 China Philanthropy Development Brief. For a copy of the complete report in Chinese, please contact us at rd@bnu1.org.
Preface China's philanthropic sector witnessed several remarkable developments in 2010. The general public took increasing note of emerging high-profile sector personalities and institutions, as media exposure also increased with the coverage of several hotly discussed philanthropic events. Within the philanthropic sector itself, experts continued to discuss the transformations of China s various social organizations and the opportunities and challenges which they face. An increasing number of wealthy people began to participate in philanthropic activities, drawing considerable public attention. Notable examples include Chen Guangbiao, who advocated for the wealthy to bequest all of their estate upon their death, Wang Jianlin s donation of RMB 1 billion to conduct historic preservation-related activities, and the establishment of a family foundation by Cao Dewang and his son through the donation of company stock. As philanthropic organizations and foundations multiplied rapidly and became increasingly recognized for their social value, they continued to carefully reposition themselves so as to maintain government support and understanding. Among philanthropic organizations, the One Foundation s transition from private to public foundation served as one of the year s key events. Political and academic elites also increasingly contributed to the development of philanthropy in new and changing ways. The year saw a Ministry of Civil Affairs Director General exit the government system to enter into a research post specifically focused on philanthropy. Likewise, an academic famed for his work in the social sector accepted the position of Board Chair of a major foundation. While the central government continued to strengthen its management of and control over philanthropic organizations, it also showed signs of increasingly recognizing non-profit organizations potential as a tool for social governance. The government seemed to indicate recognition of the philanthropic sector s growth as inevitable, thereby shifting the focus of internal policy dialogue to absorbing and guiding the sector in ways which will encourage social order and stability. From the year s events, it seems clear that the government increasingly accepts the formation of a new development model based on an associated axis relationship between government and society. Beijing Normal University One Foundation Philanthropy Research Institute March 2011
Progress and Transitions: Eight Major Trends in the Development of China's Philanthropy After the incredible charitable outpouring seen in response to the 2008 Wenchuan earthquake, and the relative calm in 2009, China s philanthropic sector began to see great changes in 2010. Overall giving continued to rise at a skyrocketing rate, with total donations estimates at RMB 70 billion in 2010, up from RMB 30 billion in 2008 (excluding disaster relief donations) and RMB 50 billion in 2009. Several important trends emerged in 2010, which could be classified as a year of transformation for China s philanthropic sector. The following article highlights the eight most notable changes to occur over the past year, and the impacts they have had on the development of philanthropy in China. Trend 1: The Beginning of Widespread Philanthropy Sector leaders increasingly pushed to expand public participation in philanthropy. Prior to the Wenchuan earthquake, individual giving accounted for only 20% of total annual philanthropic donations in China, compared with 80% from corporate donors. During the earthquake, individual donations rose to as much as 50% of total giving. While overall donations increased in 2009, the proportion of individual donations once again dropped to no more than 30%. 1 In contrast, individual giving in the 1 Yang Tuan, Ge Daoshun editors. Annual Report on China s Philanthropy Development 2009. Social Sciences Academic Press (China), 2010. 1
United States accounted for about 70% of total donations during the same period. 2 This indicates that the public, by and large, have yet to become active participants in China s philanthropy sector, which inevitably impacts not only the scale of the sector but its healthy, professional development. As long as funding channels are monopolized by a handful of foundations, accountability will remain low as organizations compete to establish good relations with their select funding sources rather than the wider society. To address this issue, Chinese philanthropic leaders in both government and the social sector held several events in 2010 which aimed to empower the public s overall involvement in philanthropy. The Guangzhou provincial government and the China Poverty Alleviation Foundation hosted the first All Public Philanthropy Forum in December 2010. The forum s more than 500 participants included government officials, entrepreneurs, philanthropic practitioners, members of the media, scholars and volunteers. The large scale of the event, and more importantly, the use of the word 全民 or all public in the title, strongly indicates a growing willingness to accept public participation in philanthropy rather than a focus on government intervention or elite charity. In addition to the forum, it became increasingly popular for local authorities, most often municipal-level, to promote public philanthropy and charity related activities. These activities often took the form of a Philanthropy Month or a Philanthropy Day, where citizens were encouraged to either donate money to 2 Giving USA Foundation/Giving Institute, Giving USA 2009, American City Bureau, Inc. 2
philanthropic organizations or to volunteer time for public projects. Thousands of people took part in these activities, such as in Changchun, Shenzhen and other cities. These activities were in part influenced by larger national campaigns that encouraged regular participation in philanthropy by individuals. Perhaps the best known of such ongoing popular campaigns is the One Foundation s 1 person + 1 RMB + 1 month = 1 big family, which encourages the public to donate small amounts of money or volunteer time on a regular basis. Many other organizations, such as the China Foundation for Poverty Alleviation and the Tencent Foundation, have followed suit and begun monthly donation plans. This marks an important new trend to actively encourage greater individual giving and citizen participation. Trend 2: Increase in Large-scale Donations by Wealthy Elite As the public at large began to increase their contributions to philanthropic activities, the country s elite also stepped up involvement. 2010 saw not only an increase in the number of donations, but a rise in very large donations. According to the China Charity Donation Information Center, there were 36 donations exceeding RMB 100 million in 2010, for a total of RMB 8.3 billion. An example of this type of large-scale giving is Cao Dewang, a businessman from Fujian province. He donated RMB 100 million to the CCTV Yushu relief party on April 20, 2010, breaking China's individual philanthropy donation record for a one-time donation. In late May, Mr. Cao and his son again donated RMB 200 million to the five drought-affected provinces in southwest China, RMB 400 million to Fuzhou city for library construction, and RMB 300 million to their hometown, Fuqing 3
city, for philanthropic activities. Within the span of two months, Mr. Cao donated as much as RMB one billion of his personal wealth. Trend 3: Official Government Recognition of and Engagement with Philanthropic Organizations If the expansion of philanthropy into the public sphere is a key indicator of whether China s social sector has reached a mature level, then a prerequisite to this development is necessarily the government s provision of a social space. Evidence from the United States, Britain and other countries suggests that government support is an important factor for the healthy development of a philanthropic sector. In 2010, the government at all levels seemed more willing to both publicly support the philanthropic sector and to engage with it in new ways, including the procurement of social organizations services, increased efforts at coordination, and official recognition of innovative best practices. The Government s Public Show of Support Within China, the presence of officials, particularly high-ranking ones, at an event is often tantamount to official sanction or approval by the government. 2010 saw several notable philanthropic events which were attended by important officials. One such occasion was the establishment of the Ningxia Yan Bao Foundation on January 20, 2011. Zhang Yi, Party Secretary of Ningxia Autonomous Region and Wang Zhengwei, Chairman of the Autonomous Region, the two highest officials in the province, attended the opening ceremony an unprecedented show of support for this type of local non-public foundation. 4
Similarly, the 2010 All Public Philanthropy Forum, saw the participation of many Guangdong provincial and party leaders such as Wang Yang, Secretary of Guangdong Provincial Party Committee, Chen Changzhi, Vice Chairman of the NPC Standing Committee, and Huang Hua Hua, Vice Secretary of Guangdong Provincial Party Committee and Governor of Guangdong province. The presence of such high level officials from both the government and the party shows a united support for similar types of philanthropic activities, and signals official sanction of the sector. The Government s Increasing Engagement The government at local and national levels increased its collaboration with the social sector throughout 2010. Shanghai created the first Social Innovation Incubator in China as early as 2008, establishing a platform for the government, philanthropic social organizations and social enterprises to interact and coordinate responses to social problems. By 2010, a model had emerged and many other cities such as Beijing, Shenzhen and Chengdu began creating their own innovation centers. In December of 2010, the Central Compilation and Translation Bureau held the first annual Social Innovation Awards, which recognized ten creative approaches to philanthropy. Winners included the China Foundation Center and the philanthropist Chen Guangbiao for their contributions. The awards were notable not only for their emphasis on innovation, but for the fact that they were organized by an official Chinese Communist Party entity, and therefore can be seen as a tacit indication of support for the sector by the party. An extremely important aspect of the government s increased collaboration with 5
social organizations was its willingness to purchase services from social organizations. Though this collaboration was already occurring on a small scale throughout the country, the Shenzhen municipal government set an important precedent in 2009 by including in its officially released annual plan the intention to procure social services (from social organizations). This was followed by the Beijing municipal government s decision in 2010 to purchase an estimated RMB one billion in services from around 300 social organizations in such fields as medicine and health. This allocation in particular was a landmark event, signaling both government recognition of social organizations value, and also the opening of a new avenue for funding. This trend was reaffirmed in early 2011 when the Beijing government announced it had earmarked RMB two billion to procure social organization services in 2011. Trend 4: Changes in Regulatory Environment for Local and Foreign Organizations 2010 saw two opposite trends occurring in the legal regulatory environment: encouragement for the development of local organizations and restrictions on international organization interaction and operations on the Mainland. China s lack of a mature, comprehensive legal framework for philanthropic activities has been criticized as a major roadblock for sector development. While a set of national-level philanthropy laws was drafted over five years ago, there has been no recent movement to pass or implement them. In response, 2010 saw an increasing number of provincial governments creating their own local philanthropy-related laws. Jiangsu province issued the "Jiangsu Province Philanthropy Promotion Regulations", 6
which is China's first set of comprehensive provincial-level philanthropy regulations created with the intention of not only monitoring but promoting philanthropic activities. Similarly, the "Hunan Province Donation Regulations" is the first local law in China to regulate fund-raising activities. This law encourages sector development by clarifying and defining legal avenues for donations. While it has yet to be seen how effective such laws will be, they represent an important symbolic step toward the government s willingness to assist sector development through legal policy. Simultaneously, both local and national law began to tighten regulations for international organizations. Beginning January 2010, Yunnan Province required all foreign non-profit organizations running projects in Yunnan to first register with the provincial Civil Affairs Department. On March 1, 2010, the State Administration of Foreign Exchange introduced a new regulation for foreign exchange donations that requires social organizations seeking international funding to first submit an application, notarized donation agreement including detailed summary of planned use of funds, and proof that the foreign entity has nonprofit status. As many local social organizations still rely on international donations, these regulations added significant prohibitory barriers to foreign funding. Experts believe that this will have a short-term negative impact on the development of small organizations. Trend 5: The Expanding and Deepening Conversation on Philanthropy Several high profile events and individuals sparked not only a surge in public 7
dialogue on philanthropy, but prompted such discussions to become increasingly sophisticated. The widespread impact of the 2010 "Warren Buffet Charity Dinner" (the dinner given by Bill Gates and Warren Buffett in Beijing) is virtually comparable to the affect of the 2008 Wenchuan earthquake on China s philanthropy sector. The September visit created an instantaneous opportunity for a very public reflection on the concept of wealth in Chinese society, and how it ties to and affects public welfare. Their visit not only spurred discussion on the differences between traditional charity and modern charity, as well as between Eastern and Western charity culture, but also had the effect of expanding such dialogue to the greater society, whereas it had previously been limited to sector experts and scholars. The continuing philanthropic activities of one of China s most famous philanthropists, Chen Guangbiao, also had a similar effect. A controversial figure, Mr. Chen stirred discussion on modern vs traditional methods of philanthropy. Similarly, Mr. Wang Jianlin s RMB one billion donation to the Baoguo Temple in Nanjing raised public dialogue about the lines between charitable actions and business investment. Driven by these famous entrepreneur-philanthropists, the society as a whole began to further investigate the issues of corporate social responsibility, corporate philanthropy and strategic giving. Reinforcing this public discussion were key media reports such as China Forbes article 2010 Fortune VS Charity, which paired a listing of China s wealthiest individuals incomes with their annual charitable giving. Major exposure on the Internet and from traditional media outlets also shows the 8
public s growing interest and importance in the sector. In June 2010, the Beijing Times began to release the Beijing Times Philanthropy Weekly, thereby becoming the first periodical focused specifically on philanthropy to be released by a Chinese metropolitan newspaper. An informal survey conducted by BNU1 showed that not only do all mainstream web portals have specific areas of their website devoted to philanthropy, but overall reporting on philanthropic-related news continued in an upward trend. The following graphs represent a rough tally of online articles based on key word searches, and show a clear pattern of increased coverage. Graph 1: Total number of Chinese articles on Philanthropy and Charity (2005-2010) Graph 2: Chinese media reports on philanthropy by key words (2005-2010) 9
2005 2006 2007 2008 2009 2010 Philanthropy and disaster 702 934 1140 10100 5160 6500 relief Percentage Change 33.05% 22.06% 785.96% -48.91% 25.97% Philanthropy and rescue 2410 3950 5520 8400 8860 9210 worker Percentage Change 63.90% 39.75% 52.17% 5.48% 3.95% Philanthropy and 3860 5780 8510 13600 15800 20000 Foundation Percentage Change 49.74% 47.23% 59.81% 16.18% 26.58% Philanthropy donation 6280 9370 12800 22600 20200 26200 Percentage Change 49.20% 36.61% 76.56% -10.62% 29.70% Philanthropy education 9830 15000 18000 24700 30900 32600 Percentage Change 52.59% 20.00% 37.22% 25.10% 5.50% Table 1: Year-on-year percentage changes for media reporting on philanthropy by topic (2005-2010) Trend 6: Internationalization of China's Philanthropy Chinese philanthropy sought to expand beyond national borders in 2010. To a simplified extent, the globalization of Chinese philanthropy will happen in three steps: the sector will first increase research on active international organizations, begin to adopt international standards and interact with a global network of philanthropists. Second, charity organizations will make exploratory attempts to expand activities into other countries. Ultimately, national organizations will establish international operation and management models based in part on global standards. In the year 2010, the sector remained largely in the research phase, but for the first time local charities also began expanding activities internationally. Events such as the Warren Buffet Charity Dinner and Beijing Normal University s salon, Charity China: How Will China Deal with Challenges of Charity Internationalization, indicate the sector s growing attempt to view Chinese philanthropy within the global context. This was taken a step further with local social 10
organizations starting to implement programming abroad. The China Poverty Alleviation Foundation, one of the most influential domestic foundations, quietly began a capacity building project in Sudan, and the China Youth Development Foundation launched the China-Africa Hope Project in Tanzania, which will build primary school buildings. Trend 7: Breakthroughs in Sector Transparency In the past two decades many people, including Shang Yuxian, Yan Mingfu, Xu Yongxian, He Daofeng, Wang Zhengyao and the Ford Foundation s first China representative, Mr. Peter Geithner, have all made efforts to promote self-regulation within China's philanthropy sector. Their work finally began to take root, and 2010 appeared to be an important turning point with respect to sector transparency and accountability. First, the establishment of the China Foundation Center (CFC) and subsequent launching of its website (www.foundationcenter.org.cn) in July 2010 can be considered a revolution in the field. The CFC tracks data on all registered foundations in China, and releases this information, including financials when available, through its online platform. It marks a breakthrough in the Chinese philanthropy system in terms of information transparency. Acceptance of third-party monitoring and evaluation also became more apparent, particularly through the China Charity and Donation Information Center s annual release of the China Charity Transparency Report, which analyzes improvements and continuing challenges in foundation accountability and transparency. This report has 11
gradually matured to become a widely recognized source of information in assessing the sector s transparency. Trend 8: Increased Focus on Human Capital within the Sector Arguably the most important trend of the year was the sector s intense focus on improving human capital. Traditional beliefs that philanthropic workers require little more than a kind heart gave way to more modern approaches needed to conduct high-impact philanthropy including management, leadership, and implementation training. This theme was also apparent in much of the year s research, such as the Narada Foundation s Development and Demand of Philanthropy Talents Research Report, which again highlighted the remaining gap between demand and supply for social sector talent. Several new initiatives were undertaken in 2010 to address this widely recognized need. Two new education institutions focused on training social sector specialists were announced in 2010. Aiming to provide advanced training and education opportunities for individuals seeking to specialize in nonprofit work, the Beijing Normal University One Foundation Philanthropy Research Institute was established in June and the China Social Entrepreneur Foundation announced its plans to create a Youcheng University. The creation of such institutions was met with high expectations by members of the sector. The establishment of the Philanthropy Research Institute was even listed among the ten most important philanthropy events in 2010 in the Narada Foundation s annual China Development Report. Organizations known for their focus on sector capacity building also scaled up 12
training-related programs in 2010. The Nonprofit Incubator, which trains local social organizations on financing techniques, internal management, public relations and communications etc., expanded their training program nationwide. International organizations such as BSR and Mercy Corps also increased their focus on training, particularly with regard to foundations. While the creation of new formal academic and short-term education opportunities responded to the need for increased specialized training, other innovative initiatives attempted to stem a brain drain type sector loss of current talent by providing new incentives. This was particularly evident in the Narada Foundation s newly launched Ginkgo Fellow Program, which supports grassroots nonprofit leaders with a three-year annual personal allowance of RMB 100,000, capacity training, and networking opportunities. In this way, the Narada Foundation hopes to offset the lack of funding for management staff at the grassroots level, which is a key barrier to improvement in human capital. While barriers such as salary disparities remained a significant sector problem, philanthropy work nevertheless began to attract an increasing number of professionals from other fields. 2010 saw some extremely high profile examples of this trend, most notably the departure of former Director General Wang Zhenyao, from the Ministry of Civil Affairs Department of Social Welfare and Charity Promotion to become Dean of the One Foundation Philanthropy Research Institute, and Professor Zhou Qiren, Dean of the National School of Development at Peking University, who became Board Director of the Shenzhen One Foundation. Increasing numbers of business 13
professionals also entered the field of philanthropy, bringing with them new ideas in management methods. This shows philanthropy-related work s growing appeal to elite members of academia, the government, and business, which will also inevitably alter the sector s future talent pool. Additional developments and prospects Apart from the eight major trends, there were many other notable developments within Chinese philanthropy in 2010. Discussion on the concept of social enterprises was in full swing, with many vocal supporters and detractors. The China Social Entrepreneur Foundation, in coordination with many other organizations, held Charity Carnivals in Beijing and Shanghai, which highlighted social enterprise and innovation. While the sector as a whole did not reach any consensus on social enterprises, these discussions succeeded in introducing case examples and business management models into the field of philanthropy. Innovative use of technology became increasingly important to philanthropic organizations. Online forums, social media and micro-blogging emerged as platforms for exchanges and communication in the field. New technology continued to revolutionize fundraising and advocacy methods, particularly as traditional information channels such as the work unit system became less important. While overall trends and developments proved positive for China s philanthropic sector in 2010, there were also some setbacks. The most notable of these was the 14
government s response to Yushu earthquake relief donations. While this major national disaster once again prompted an outpouring of giving by both companies and individuals throughout the country, the government required organizations and foundations to channel all donations directly to the local Qinghai government rather than allow them to distribute relief funds independently. Conclusion: Ultimately, the development of China's philanthropy depends on two factors: the ability of charity organizations to carry out work publicly, and opportunities to improve and foster human capital within the sector. Despite some setbacks, 2010 brought overall positive changes on both of these fronts, and the sector appeared to be strengthening. Critical areas to watch in the coming year include establishment of family foundations, the roles adopted by local governments in philanthropy, and whether or not the social organization registration process actually becomes more accessible. At the outset of 2011, however, China s philanthropic sector seems poised to continue to rise in prominence within the greater society. 15
Research Reports List of major research reports January 2010 February 2011 NO 报告名称 Name 发布时间 Time 发布机构 Issued by 2010 年中国企业公益传播研究报告 2010 年 3 月 1 2010 Research Report of Philanthropy Sun Yat-Sen University March, 2010 Dissemination among China Enterprises 2009 年度中国慈善捐助报告 2010 年 4 月 China Charity & Donation 2 2009 China Charitable Donation Report April, 2010 Information Center 中国非公募基金会信息披露指南 2010 年 10 月 3 China Private Foundation Information October, 2010 China Private Foundation Forum Disclosure Guide 4 2009 年中国非公募基金会发展报告 - 非公募基金会的内部治理 2009 China Private Foundation Report -- 2010 年 10 月 October, 2010 China Private Foundation Forum Internal Governance of Private Foundations 中国非公募基金会项目案例研究 2010 年 10 月 5 China Private Foundation Project Case October, 2010 China Private Foundation Forum Research 6 中国公益教育发展现状与展望 China Charity Education Development Status and Prospects 2010 年 11 月 November, 2010 Beijing Normal University One Foundation Philanthropy Research Institute 7 2010 年 慈善蓝皮书 2010 China Philanthropy Blue Book 2010 年 11 月 November, 2010 Chinese Academy of Social Sciences 8 中国公益人才发展现状及需求调研报告 China s Philanthropic Sector Talent Demand and Development Status Report 2010 年 12 月 December, 2010 Tencent Foundation, Narada Foundation, Liu Hongru Financial Education Foundation 9 2010 年度中国慈善透明报告 2010 China Charity Transparency Report 2010 年 12 月 December, 2010 China Charity & Donation Information Center 10 中国第三部门观察报告(2011) Observation Report on the Third Sector of China (2011) 2011 年 2 月 February, 2011 NPO Research Center, Renmin University of China 16
Major Workshops and Forum List of major workshops and forums in January 2010 February 2011 1 2 3 4 5 6 名称 Name 时间 Time 主办机构 Organizer 首届中华慈善百人论坛 2010 年 5 月 16 日 Initiated by Xu Yongguang, Wang Zhenyao, Yang 1 st China Charity One Hundred Person May 16, 2010 Tuan, Chen Jianmin, and Feng Yan Forum 光华科技基金会 首届中国公益基金发 2010 年 6 月 1 日展论坛 China Guanghua Foundation, Jinlong Technology June 1, 2010 China Guanghua Foundation--1st China Innovation Development Foundation Non-profit Foundation Development Forum 北京师范大学 慈善中国 学术沙龙 2010 年 9 月 26 日 Philanthropy Research Center of China, Beijing Beijing Normal University--Charity China September 26, 2010 Normal University Academic Salon 第二届中华慈善百人论坛 2010 年 10 月 25 日 Initiated by Xu Yongguang, Wang Zhenyao, Yang 2 nd China Charity One Hundred Person October 25, 2010 Tuan, Chen Jianmin, and Feng Yan Forum 第二届中国非公募基金会发展论坛 2010 2010 年 10 月 28 日 Narada Foundation, Youcheng Foundation, Wantong 年会 October 28, 2010 Foundation, etc. China Private Foundation Forum 2010 2010 年 11 月 6 日第一届京师公益论坛 Beijing Normal University One Foundation November 6, 2010 The first Capital Charity Forum Philanthropy Research Institute 7 上海增爱基金会 2010 年度公益主题国际研讨会 Shanghai More Love Foundation--2010 Charity International Workshop 2010 年 12 月 11 日 December 11, 2010 Shanghai More Love Foundation, NGO Research Center of Tsinghua University, China Nonprofit Review Editorial Office 8 清华大学 首届 企业社会责任领导力行动 论坛 Tsinghua University--1st Corporate Social 2010 年 12 月 14 日 December 14, 2010 Tsinghua University School of Journalism and Communications, Ruder Finn Responsibility Leadership Action Forum 香港首届 慈善中国和谐社会 高峰论坛 2010 年 12 月 23 日 Red Cross Society of China, China Soong Ching Ling 9 1 st Hong Kong Charity China and December 23, 2010 Foundation, Chinese Cultural Exchange Association, Harmonious Society Summit Forum Chinachem Charitable Foundation Limited 10 上海师范大学 21 世纪中国慈善事业和慈善伦理研讨会 Shanghai Normal University--21st Century China Charity and Charity Ethics Workshop 2010 年 12 月 27 日 December 27, 2010 Shanghai Ethics Council, Shanghai Normal University Education Development Foundation, Shanghai Normal University Economic Ethics Research Center 11 2010 中国慈善年会 China Philanthropy Annual Meeting 2010 2011 年 1 月 13 日 January 13, 2011 China Charity & Donation Information Center 17