Philanthropy in China

In 2007, Princeton alumnus Sir Gordon Wu ’58, the namesake of Wu Hall in Butler College, completed payments of $100 million that he pledged to the university in 1995, bringing his total lifetime donations to over $118 million.He gave this donation to support the School of Engineering and Applied Science, particularly to increase the number of endowed professorships, supporting renovations and construction, and to provide fellowships to graduate students. As the giver of one of the single largest donations in the University's history, Wu was a pioneer in many ways.

Earlier this year, Bill Gates, also an avid philanthropist, urged wealthy Chinese people to engage in and encourage more philanthropy, implying that philanthropy is not as common a practice in China as it is in the United States.The numbers certainly support that assumption — in 2013, China’s top 100 philanthropists gave away $890 million, which is, according to Forbes, less than what Mark Zuckerberg and his wife gave away in one year.This is despite the fact that according to Shanghai research firm Hurun, China surpassed the United States as the country with the highest number of billionaires.Looking at the wealth divide between the richest in the country and the vast number of the poor with many issues to address, it’s surprising that charity hasn’t gotten more attention in China.

China’s substantial number of donations in times of crisis seems to support the notion that lack of philanthropy is not a result of lack of empathy. China’s total donations to the 2008 Sichuan earthquake amounted to over 100 billion RMB, nearly five times the total amount given to charities the previous year. However, consistent patterns of giving are still in the process of being established.

Chinese philanthropy hasn’t always been underachieving. In Imperial China, public facilities like bridges and schools were often built with the contributions of generous nobles. Village clinics and soup kitchens were similarly supported by wealthy donors. By the time of the arrival of communism, personal wealth was marginalized and became part of the state’s property. Philanthropy was no longer deemed necessary, since any additional need for funds was a criticism and a sign of the failure of the government, not as a charitable act.

Additional obstacles to giving include not only a lack of recent tradition but also a lack of transparency in Chinese charities. Only 30 percent of registered charities in China meet basic international standards for transparency, according to China Charity Transparency Report.Due to the many scandals attributed to Chinese charities and their lax accounting practices, Chinese people have begun to view charities as scams. Total donations in China dropped in 2011 and 2012 from previous years because of a scandal involving the Red Cross Society of China, a government organization that is the country’s largest charity. A 20 year-old woman, Guo MeiMei, posted several photos online of her lavish lifestyle, posing with luxury cars and designer handbags that she claimed she owned. Her verified title on her blog was “commercial general manager” at the Red Cross. While the Red Cross later said she had no relation to them, donations still suffered. Later in the year, a photo of a $1,500 restaurant bill for a group of Red Cross workers surfaced, causing more outrage. After that, the National Audit Office issued a report on the Red Cross pointing out five financial errors, namely money spent that was unaccounted for. As the largest charity in China, and as the charity most prominently backed by the state government, it was no wonder that losing faith in the Red Cross meant losing faith in giving altogether.

One prominent philanthropist, Chen Guangbiao, hasn’t been helping in changing people’s perceptions of charity, either using methods such as “stacking piles of cash to form a wall for a photo op or dancing on the rooftops of brand new cars that he bought for donation.” Using attention-grabbing techniques to encourage the rich in China to give more to charity, Guangbiao has alienated the majority of people and turned giving into a circus. His intentions, however noble, haven’t helped toward the result he wanted. He instead has reinforced the idea of charity as wasteful, extravagant, and not meaningful.

Ronnie Chan, a Hong Kong property businessman, like Wu, donated $350 million to Harvard in September.Some criticized him for giving to an already wealthy university rather than one in China. When Wu was asked the same questions, he responded that it was important to maintain Princeton’s top quality, rather than spend it in Asia to “produce more mediocrity.” Chan responded that he liked to “donate to projects that we think are meaningful.” Looking at the state of Chinese charity organizations, it seems reasonable for Chinese philanthropists to choose causes away from China. Chinese philanthropy, unfortunately, is stunted because of the lack of trustworthy organizations to donate the money to and the lack of encouragement from others. It’s not a commentary on the generosity of donors themselves, but on the worry that they don’t know where the money goes, and rightly so.