NEW YORK, April 6 (Xinhua) -- The Chinese philanthropy sector has quadrupled over the last decade as of 2017 with remarkable grant-making, and has been increasingly empowered by advanced technologies, which unlock great potential for impact delivering and global collaboration, according to a new report debut in New York City (NYC) on Friday.
"We felt that in the Chinese market, the mindset has a shift. There is an openness to being strategic, being in long term, and being outcome-focused in terms of the quality of grant making, and the quality of channeling capital towards all forms of impact (of philanthropic projects)," said Kevin Teo, chief operating officer at Asian Venture Philanthropy Network (AVPN), during a panel discussion on the report.
The report, titled Philanthropy in China, was conducted by AVPN, a Singapore-based social investors' network, with support of the Rockefeller Foundation, a NYC-based private foundation established by the Rockefeller family.
GROWING ENGAGEMENT BY PRIVATE WEALTH
Total giving in China has quadrupled from 2009 to 2017, with a significant 23.4 billion U.S. dollars pumped into the philanthropy sector in 2017, up 6.9 percent from the 21.9 billion dollars in 2016, according to the report.
Private wealth is a critical contributor to the growth, as donations from private companies and corporate foundations dominated the country's philanthropic giving, followed by affluent individuals and other types of organization, such as government agencies and public institutions.
In 2016, capital from corporate giving reached 14.2 billion dollars, contributing to around 65 percent of the total amount.
As for individuals, with 819 billionaires, China has not only the largest number of billionaires in the world, but also the highest number of millionaires engaged in environmental, social and governance-related investing.
According to the 2018 Hurun Philanthropy list, China's top 100 philanthropists made public donations of 3.3 billion dollars in aggregate to foundations, NGOs and education institutions domestically, up 33 percent from the previous year.
The most popular causes supported by philanthropic donation were education, poverty alleviation, social welfare and healthcare.
"By putting out these pieces of research, we seek to have a rallying point, firstly by generating awareness (on) what is the reality, and then presenting opportunities for not only more stakeholders within the country, but also stakeholders from the outside to join hands into each market," said Teo at the event.
The report also pointed out that the overwhelming share of corporate giving and individual donations in China has been largely stimulated by a rising awareness of social responsibility, favorable corporate tax incentives for charity, as well as the country's Charity Law passed in March 2016.
"The 2016 China Charity Law promotes the formalization and professionalization of the philanthropic sector in China," said the report. "The Law provides a clear framework and guidelines for social organizations to obtain charitable status, which was rather opaque in the past."
Currently, the corporate tax deduction for donations to approved charitable organizations can be up to 12 percent of the company's annual profit in China, which is considered "quite favorable" compared to other countries like the United States, where the charitable deduction is capped to 10 percent of annual taxable income, according to the report.
Yet the report also cautioned some problems in China's philanthropy ecosystem, such as a very limited number of intermediaries able to help in sophisticated areas regarding charity, and a lack of data transparency, which hinders the effective channeling of philanthropic resources.
That has led corporate foundations in China to "choose to become operating foundations, instead of grant-making foundations, as they are not able to find the right information nor the best partners," said the report.
ADVANCED TECHNOLOGY, GLOBAL COLLABORATION
However, the report expressed optimism to the thriving Chinese philanthropy, given an improving regulatory environment and rapid growth of philanthropic capital.
"We see a need to marshal resources more effectively towards the delivery of scalable, high-impact solutions," said Naina Subberwal Batra, chairperson and CEO at AVPN, who co-authored the report.
One effective approach that Chinese companies resort to is cutting-edge technology, such as artificial intelligence (AI) and the country's thriving digital services sector, to spark greater public interest in charity.
Such innovative approaches will possibly help enhance transparency and accountability, thereby building trust and productivity within the philanthropic sector, said the report.
"Too much of traditional philanthropy is oriented around reaching. We need more scale. We need more impact. We need more technology to get there," said Rajiv Shah, president of the Rockefeller Foundation during Friday's discussion.
"In this case, data science, machine learning, artificial intelligence (have the potential) to lift the most vulnerable," he noted.
To make healthcare more accessible and affordable, Happy Life Technology (HLT) invested about 150 million dollars from 2013 to 2017, to have built, in collaboration with 500 scientists, a large-scale data operating system that can digest medical data from 4,000 manufacturers across China.
"So now we're in 22 provinces and covering around 300 million people," said Rujing Gong, co-founder and chairwoman of the Chinese company that focuses on tech-driven healthcare solution.
She also mentioned an application based on the company's AI system that provides data for scientists to quickly evaluate and validate their hypothesis by using a simulation model at a much lower cost.
"My belief is to bring down the research cost for drugs by using AI technologies, and also reduce misdiagnosis by using our real-world evidence," Gong told Xinhua. "Those two would use a huge portion of the public healthcare spending."
"So all those initiatives and all those applications that we're trying to do is for one objective. That's a cheaper healthcare for everyone," she added.
Talking about technological application, Shah said his foundation has served as "a bridge" between those who know how to operate on the ground in embattled communities and those who know how to build the tools and technologies to deliver the impact of philanthropic projects at scale.
"So to me, these two coming together and imagining what's possible is the power of transformation," he said.
Shah added that if the foundation can be the bridge to bring HLT's huge data operating system to some African countries, it would probably save several million women and children "who otherwise will die in childbirth or under the age of five."
In this aspect, the report also found that China's cross-border projects are propelling domestic organizations towards more meaningful international development engagement, such as the Belt and Road Initiative and South-South cooperation, through sharing knowledge, resources and capital.
"We look forward to working hand-in-hand with Chinese family offices and individual philanthropists, especially the next generation of givers, to unleash the catalytic potential of their philanthropic capital and build the foundations for new philanthropic legacies," said Deepali Khanna, managing director for Asia at the Rockefeller Foundation.