Chris Stone. Director of the Hauser Center at the CFC Ceremony

China foundation Center was inaugurated on July 8 of 2010. A brainchild of some of the visionaries in the philanthropic field in China, such as China’s best known philanthropic figure, Xu Yongguang, who created the Hope Project two decades ago which has become the best known philanthropic brand in China, and Shang Yusheng, who has been referred to as the Father of Accountability for nonprofits in China, its opening ceremony has attracted the attention and support of best known figures in the field of philanthropy of China. Among the almost Chinese-Philanthropy-Who-is-Who guest and team list, there was Wang Zhenyao, who has recently resigned the post in charge of China’s charity and philanthropy at the Ministry of Civil Affairs to create a philanthropy institute at Beijing Normal University, He Daofeng, the legendary leader of the China Poverty Alleviate Foundation who has established a an example for a how a GONGO becomes entrepreneurial, Zhuang Ailing founder of one of the most active support organizations, Yuan Yue, the famous public speaker on philanthropy and a practitioner of philanthropy as a successful business entrepreneur. The most prominent international players in this field were also present. They included the Ford Foundations’s first China Representative, Peter Geithner, China Representative of Gates Foundation Ray Ipp, China Representative of Ford Foundation John Fitzgerald, President of the Foundation Center in the U.S. Brad Smith, and Director of the Hauser Center at Harvard University, Christopher Stone.

In China, if you have the right people on board, that almost means half of the success. However, the fact that these groups of important people are giving their support somehow testified to the significance of this initiative.

From the speeches by the guests at the Inaugural Ceremony as well as the Round Table discussions, this initiative has been regarded as timely, visionary and smart.

As symbolized by its logo–a sandglass with golden sands (which I heard is the idea of Xu Yongguang), transparency and dispersion of fortune is the theme for the CFC.

Theme One: Giving (Dispersion of Fortune). As a grassroots initiative for the private foundation community in China, the CFC highlighted the fundamental motivation behind a foundation: giving. To the increasing number of wealthy individuals in China, setting up foundations to give to charitable purposes has not yet been a commonly considered thing to do. The creation of the CFC represents a milestone in the evolution of the private foundation community in China, and makes it almost a default norm for the rich to consider “giving”: If you have not set up a foundation or have not given big, you are out: See your peers are already exploring how to give better.

Theme Two: Transparency. Aspiring to become a portal to disclose detailed financial and program information of all foundations (and nonprofits) in China, the operation of the CFC will trigger a chain reaction that changes the fundamental behavior of philanthropy in China.

First, Chinese foundations, especially the public fundraising foundations most of which are GONGOs, are under the pressure to comply and disclose their information too. This includes both their financials and their programs. Some major GONGOs like the China Charity Federation, China Red Cross Foundation, are the government designated legal recipients of public donations from home and abroad in times of disaster. During the Wenchuan Earthquake period for instance, there were up to $8 billion donations and over 90% went to the GONGOs. For the Qinghua earthquake, the government issued an order to have these foundations transfer funds raised to local Qinghua government. When information disclosure becomes a norm for foundations, GONGOs will be under the pressure to account for the funds raised.

Secondly, as being empowered with information to make comparisons among foundations, the Chinese public will learn to ask for accountability for their donation. According to a survey conducted by the China Youth Daily leading up to the launch of the CFC, only 26% surveyed public will try to understand the usage of their donations. Over 50% said that they will not try to find out about it. The CFC information will no doubt help the public to learn to give smarter.

Thirdly, for the foundations, when giving an opportunity to showcase their internal programs, another pressure is to put up a better show. The ensuing questions that they have to think all the time will also include: are you doing strategic philanthropy; are your programs innovative.

A successful CFC will also provide the burgeoning Chinese civil society a good leverage to balance the government influence in this field. In the landscape of Chinese foundations, government backed foundations are generally the super big ones. They have the monopoly in collecting public donations, especially in time of disaster. They are generally also in a much competitive position to take business donations because the ties with the government and more publicity. The private foundation community establishing the rule of game for foundations is a very smart move to try to influence those foundations coming from the old system.

However, there are some reservations in the field about the future of the CFC. The government had earlier made an effort to build a similar information center on foundations, but did not succeed due to various difficulties. If the government could not do it, how can the CFC succeed? If the government takes up the work again, where will the CFC stands? Then, to what degree will the CFC have the power to solicit data from the foundations?

The power and influence of the CFC lie more in than just a complete set of data. It has to learn to use the data smartly, converting data to information. As Wang Zhenyao pointed out in his speech, we should learn to use data to make a case. We hope that the CFC will use data to speak loud and revolutionize the practice of the foundations and nonprofit field in China.

For more information of the event, see http://gongyi.qq.com/zt2010/jijinhui/.

(Xing)