A Time of Crisis and Opportunity: A Look at China’s Nonprofit Sector in 2018

 Shanghai, China

Away from the bustling Central Business District in Pudong and the grandeur of the Bond, Shanghai Jiao Tong University (SJTU) nestled in the relatively quieter district of the former French Concession with its colonial charm and walled streets lined with London plane trees.   SJTU is one of the oldest universities in China established in 1896 and has been known as “the MIT of the East” since the 1930s.  It is here, in December 2016, an Institute for Philanthropy Development was established, a first of its kind to provide professional guidance for charity organizations right after China’s first charity law coming into effect in September that same year.  Therefore, it was quite an honor for me to be invited to the SJTU campus on a hot July day by the Institute for Philanthropy Development and Chinese Association for Fundraising Professionals (CAFP) as the first guest speaker, on Canadian Fundraising Landscape and Trends, for its “Money Talk and Tea” series, a networking and learning session for local fundraisers. 

China’s philanthropy sector hit another growth spur after the implementation of the charity law in 2016.  Government dominance in the sector were diversified by more and more private foundations.    However, it continues to struggle with public trust issues even after consolidating internet fundraising to only 13 online platforms.  In December 2017, a unique campaign called “Same Birthday” went viral and raised over RMB2 million just over couple of days.  Through the Tencent Wechat (Chinese equivalent of Facebook) platform, the campaign asked donors to donate RMB1 yuan to support a child on the same birthday of donor.  366 children was chosen to be sponsored from Zhen Xiong County in rural Yunnan Province.  Donors could view the information of the sponsored children.  Soon, some donors found same photos of children posted for different birth dates and a child’s birthday was advertised as February 29 which did not exist.  Within a week, controversy snow-balled.  Public was not only questioning incorrect information but also donation fund management and privacy violation for the children featured in the campaign. A much “commercialized” successful fundraising campaign exposed many aspects of ethical concerns for the fundraising community and an urgent need to address them. 

Before our “Money Talk and Tea” (MTT) session, I met with David Sun, Assistant to the Dean of Institute for Philanthropy Development at SJTU and Erin Ye, Secretary for Chinese Association for Fundraising Professionals for lunch.  “Have you heard about the Metoo thing and perhaps we should talk about how Canadians are dealing with it this afternoon”, Erin asked me.   As lunch progresses, I learned that there had been a series of sexual harassment allegations of well-known leaders, or as some called pioneers in the nonprofit sector.  The public generally had higher expectations for the nonprofit sector so people are truly worried that the image of sector was tarnished. 

As a “tourist” visiting families in China, I have never heard about this on the news, keeping in mind that news was limited to Chinese censored news only on all channels.  No foreign news reports and websites like facebook or even google could get through the Chinese internet firewall.  I soon realized that with Chinese media censorship, true information could now flow through public media. Rather, information went around on Weibo (Chinese equivalent of Tweeter) and Wechat among circles of “friends”.  Even these channels were eventually censored.  By the end of the lunch, Erin told everyone that the government already started deleting posts on the sexual allegations, only two days after the first news broke.   

“The Metoo thing will set us back for years on public trust”, Erin worried.   I wasn’t sure how to respond.  In Canada, the nonprofit sector was not represented by a few people but an array of charitable organizations.  Nonprofit leaders are often less known by public hence the sector bears little risk if someone is exposed by Metoo movement.  It is obvious that the Chinese public puts nonprofits in more scrutiny then anywhere else.   

Beijing, China

There is no doubt that the nonprofit sector in China is facing a public trust crisis.  Just a few days before the Shanghai MTT session, I was invited to attend a group discussion in Beijing by nonprofit leaders, academics on philanthropy, foundation funders and law makers on Chinese Fundraising Ethics.  The discussion was based on the newly published AFP International Statement of Ethical Principles in Fundraising.  It’s great to see that the AFP document was used as a guiding principle and a base to shape the ethical statement for a burgeoning new nonprofit industry.  I feel truly proud to belong to a group of professionals whose experience and best practice could help in advancing philanthropy in other parts of the world. 

Three problems out of many stuck out for me from the discussion. First, although the Statement of Ethics was used as a self-disciplinary principle for individual fundraisers, it inevitably needed to be adapted as a recommendation for nonprofit organizations in China as many unethical behaviors were conducted on an organizational level.  For example, commission-based compensation was still an acceptable practice by some Chinese nonprofits not realizing such practice would undermined organizations in the long term.  It was also common that political parties were pressuring party members to make donations.  Second, there were many gaps in law that related to fundraising practices.  Tax receipt existed but because Chinese citizens didn’t do tax themselves, rather it was done by employers, many donors did not see their tax deductible applied due to the lack of knowledge from the finance department of employers.  There was also no mechanism to encourage financial transparency on costs and reporting.   Last but not the least, there was a need to have some ethical standard for some donors and beneficiaries to eliminate possibility of personal gain as a result of fundraising activities including publicized pledges that’d gone unfulfilled or using donation as a way of transferring fund among family members. 

Shanghai, China

The first MTT talk was successful.  Some thirty fundraising professionals showed up to learn about Canadian Fundraising.  To my surprise, the usual “biggies” i.e. Universities and hospitals were not there at all nor in any other CAFP events according to Erin and David.  Hospitals creating foundations to fundraise for themselves seemed to be unheard of or even frowned upon.  “Secondary education institutions don’t consider themselves to be charities”, David informed me, “they rarely look beyond their own alumni”.  Funded mostly by the government, Arts organizations also weren’t charities.  Similar to the session I did in Beijing, most attendees were from foundations.  Perhaps in China, most of the philanthropy came from wealth and originated from funders looking for needs instead of grassroots organizations.  This top-down approach presents a unique problem: fundraisers are not passionate about the cause, sometimes not knowing what is the “cause of the day”. 

Calgary, Canada

At the end of August, I received the first draft of China’s first Statement of Ethics in Fundraising practices as result of our July discussion.  It not only included a statement for fundraisers but also provided ethical recommendations for nonprofit organization itself, internet fundraising platforms, donors and beneficiaries. A second MTT talk was held last week with fundraising professionals sharing experience in preparation of the Tencent 99 Giving Day coming up on September 9, a successful online giving campaign equivalent to Giving Tuesday.  With a small but very dedicated group of professionals, China’s nonprofit landscape is changing fast.  Despite censorship and government control, Chinese fundraising professionals are able to push philanthropy forward and make a difference in the governance and legislation of the nonprofit sector.  Perhaps there is hope for democracy in the space of civil society. 

At home in Canada, Crazy Rich Asians is all the rage.  As a fundraiser, I see wealth as an opportunity for philanthropy.  Asia is certainly becoming the next wealth centre of the world.  It was exciting to observe and experience the ups and downs of an emerging nonprofit sector but more fulfilling to participate and feel a sense of responsibility to nurture and encourage a culture of philanthropy and a consensus for ethics and best practices.   


Melody Song MA CFRE
Originally from Beijing China, Melody Song has over 15 years of experience as a fundraiser specializing in identifying, cultivating, and soliciting major gifts from and stewarding relationships with prospects of the Asian/Chinese community in Canada and overseas.  Melody is a former board member of Association of Professional Researchers for Advancement (APRA), a member of Association for Fundraising Professionals (AFP), and a frequent presenter at AFP Calgary Chapter, APRA Canada, and APRA International.  Melody is fluent in Mandarin and English.