Do not quote or cite without author's permission
Initiative on Philanthropy in China
Community Foundations in China:
In Search of an Identity?
by
Chao Guo
Associate Professor
School of Social Policy & Practice
University of Pennsylvania
Weijun Lai
Department of Sociology
Chinese University of Hong Kong
China Philanthropy Summit
Research Center for Chinese Politics & Business and Lilly Family School of Philanthropy
Indiana University
Indianapolis, Indiana
October 31-November 1, 2014
© Indiana University Research Center for Chinese Politics & Business and the Lilly Family School of
Philanthropy
Working paper draft – October 2014 – Not for distribution
Community Foundations in China: In Search of Identity?
Chao Guo and Weijun Lai1
Since the government launched its economic and political reforms over thirty five years ago,
China’s civil society sector has begun to re-emerge along with the Chinese people’s renewed
quest for democracy. Economically aggressive but politically conservative, the Chinese
government has been suspicious of the motives and consequences of both movements. It is thus
not a coincidence that the ups and downs of the nonprofit sector often mirror those of
democratization from year to year. Despite the constant pressures from the state, however, the
growth of the nonprofit sector seems irreversible: today, there are close to half million officially
registered nonprofit organizations (NPOs) with nearly 6 million employees, as well as millions
of unregistered grassroots organizations (Guo, Xu, Smith, & Zhang, 2012; see also Deng, 2014;
Zhu, 2014).
It is against this backdrop that the current study reports on findings from our research on
community foundations in China. Our interest in community foundations was heightened by two
recent developments in the field of philanthropy in China. The first development is related to the
decline of public trust in government-affiliated foundations and nonprofits. Triggered by a
number of scandals around 2011 that involved such organizations as China Red Cross, ChinaAfrica Project Hope, and Henan Soong Ching Ling Foundation, public trust in government1
Chao Guo is an associate professor in the School of Social Policy and Practice at the University of Pennsylvania.
Weijun Lai is a doctoral student in the Department of Sociology at the Chinese University of Hong Kong. Research
for this working paper was supported by the Indiana University's Research Center for Chinese Politics & Business
and Lilly Family School of Philanthropy with a grant from the Luce Foundation. Our thanks to the interviewees the
Guangdong Harmony Foundation, and IU for commissioning this paper.
affiliated foundations and nonprofits has fallen to an all-time low (Xu, 2014). This credibility
crisis has led to an industry-wide self-regulation, exemplified by the signing of an agreement
among the country’s leading foundations to adoptcodes of conduct in December of 2011. In
addition, foundations went one step further to explore new models of philanthropy. For example,
there has been a growing interest among the leadership of China Charity Federation2 to follow
the U.S. community foundation model in the reform CCF and its affiliates. 3
The second development has to do with the government’s recent experiments to reform
the regulation of nonprofit organizations. One series of such experiments have taken place in
Shenzhen, an affluent south China municipality once regarded as the “window of China’s
reform.” Working in partnership with the Ministry of Civil Affairs, Shenzhen has recently
pioneered several important initiatives. In December of 2010, the Civil Affairs Bureau of
Shenzhen officially approved the registration of One Foundation as an independent public
fundraising foundation, one of the very few public fundraising foundations with no direct
government affiliation (i.e., no supervisory agency). In July of 2012, Shenzhen hosted China’s
first-ever charity fair that showcased hundreds of Chinese nonprofits. In April of this year,
Shenzhen launched its first cohort of community foundations—five in the Guangming new area
and one in the Bao'an district—as part of the municipal government’s ambitious plan to develop
50 to 100 community foundations in three years.4
Taken together, these two related developments have effectively directed public and
scholarly attention to community foundations as an emerging form of institutional philanthropy.
In the western context, community foundations are public charities that work to improve the
quality of life of a specific geographic community by pooling funds from a wide range of
2
中华慈善总会.
Available at: http://news.takungpao.com/mainland/focus/2014-04/2425572.html.
4
Source: China Daily. Available at: http://www.chinadaily.com.cn/china/2014-04/01/content_17398041.htm.
3
2
individual, family, and corporate donors and allocating grants to targeted program areas that
meet specific local needs (Gronbjerg, 2004; Guo & Brown, 2006). They are one of the fastest
growing segments of the foundation field. In 1914, the Cleveland Foundation, the first of its
kind, was established in the United States. Today, there are approximately 780 community
foundations in the United States and nearly 1,700 community foundations in over 50 countries.
In China, community foundations are the newest members of the “foundation family”; the first
community foundation is believed to have been established in either 2008 or 2009.5 Interestingly,
while the earliest Chinese experiments with the community foundation model—the “first
movers”—were led by social innovators at the grassroots level, the “second movers” had a
strong government backing. Do the first and second moves share the same understanding of the
community foundation model? If not, how do these pioneers differ in their vision of the
important roles and functions of community foundations in society? How do these community
foundations differ in their governance and management practices? To what extent are these
foundations making an impact on their communities?
In order to answer these questions and better understand this ongoing community
foundation movement, it is imperative to provide an early assessment of the definition, scope,
and functions of China’s community foundations. This study represents a modest attempt to
provide such an assessment. Due to the explorative nature of the research project, we take a
mixed-methods approach that combines the collection and analysis of secondary data with an indepth case study. In what follows, we first provide a brief overview of the history of the global
community foundation movement. We then discuss the definition of community foundation in
the Chinese context, followed by a preliminary survey and estimation of the landscape of
5
There are two contenders for the No.1 spot: Taoyuanju Community Development Foundation/桃源居公益事业发
展基金会, which was registered in Shenzhen in 2008; and Guangdong Harmony Foundation/广东千禾基金会,
which was registered in Guangzhou in 2009.
3
existing community foundations. After that, we present a case study of Guangdong Harmony
Foundation, one of the first community foundations in China. We conclude the study with
discussions of findings and directions for future research.
A Brief History of Community Foundations: U.S. and Worldwide
This year marks the 100th anniversary of the community foundation movement around
the globe. In 1914, an American banker and attorney named Frederick Harris Goff established
the Cleveland Foundation, the first community foundation in the United States. Goff’s idea was
to create a community-oriented foundation where charitable individuals could establish
permanent funds that would be available to respond to current and future community needs. The
Cleveland Foundation was designed to serve two special purposes. First, it focused on acquiring
and managing permanent charitable endowments rather than raising annual operating funds.
Second, it aimed at providing community leadership in defining community needs and
restructuring philanthropic activity. In the next couple of decades, numerous American
communities have followed the lead of Cleveland to establish similar institutions in their own
communities, but all of them have not shared exactly the same vision as Goff’s. Whereas those
in many Midwestern cities have emulated Cleveland’s example, community foundations in many
Northeastern cities have operated as a mechanism for efficiently expanding individual
philanthropy, “a mechanism of conservation and distribution of charitable funds” (Hammack,
1989: 30), but not as a leader in the general reorganization of philanthropy (Guo & Brown,
2006).
Thus since the very beginning of the community foundation movement, there has been a
debate between two schools of thought about whether community foundations should be
4
community-focused or donor-focused (Carson, 2003; Gronbjerg, 2004; Hammack, 1989; NCRP,
1994). According to the community-focused model, a community foundation seeks to “create a
new framework for private charity, one that would be more secular in orientation and more
responsive to business and professional leaders” (NCRP, 1994: 5). The model emphasizes
community leadership, participation in community collaborative initiatives, and raising
unrestricted funds in order to target high priority needs. According to the donor-focused model,
however, a community foundation should operate as a “[vehicle] for the expansion of individual
philanthropy” (NCRP, 1994: 7). The model focuses on fulfilling the charitable interests of
individual donors and on managing donor advised funds. These two different models and the
philosophies behind them have guided the divergent focuses and practices among community
foundations, and hence led to differing views on understanding and assessing the performance of
community foundations (Guo & Brown, 2006).
Regardless of the differences in philanthropy and approach, the creation of community
foundations as a new model of philanthropy has eventually gained popularity across America,
and become an international phenomenon in the past three decades. At the turn of the twentyfirst century, the total number of community foundations in the world was estimated to be
slightly over 900. In just ten years, the total became 1,680 by 2010. Europe accounted for most
of the growth: there were 103 community foundations in Europe as of 2000, but the number
increased to 631 by 2010. To a less extent, the numbers had also grown in Asia and Africa
during this period.6
6
WINGS Global Status Report on Community Foundations 2010. Available at: http://www.wings-communityfoundation-report.com/gsr_2010/gsr_about/2010_summary.cfm.
5
Community Foundations in China: Definition and Scope
Confronting the Issue of Definition
The first important difficulty we encountered in understanding community foundations in
China is the issue of definition. According to the current classification system developed by the
Ministry of Civil Affairs (MOCA), the officially registered nonprofit organizations fall into three
broad categories:
1. “Social organizations”, which include economic groups (trade unions and chambers of
commerce, etc.), social groups (social clubs, research organizations, hobby groups, etc.),
religious groups, and membership-based public-benefit organizations;
2. “Private non-enterprise organizations”, which include nonprofit schools, hospitals, and
social service organizations, among others; and
3. “Foundations”, which include public fundraising foundations (e.g., Soong Chingling
Foundation, China Foundation for Poverty Alleviation, etc.) and non-public fundraising
foundations (Guo et al., 2012).
As we can see, “community foundation” is not a legally defined category in the current
classification system developed by MOCA. The classification system identifies two main types
of foundations only: public fundraising foundations vs. non-public fundraising foundations. This
poses an important challenge for defining and estimating the number of community foundations
in China.
There exist numerous charity foundations at the provincial and local levels across the
nation; these public fundraising foundations have been converted from the local affiliates of
China Charity Federation (CCF).7 Considering their diversity of funding sources and clearly
defined geographical service boundary, it seems appropriate to treat these charity foundations as
7
中华慈善总会 (http://cszh.mca.gov.cn).
6
community foundations. However, it should be noted that CCF and its local affiliates have a
strong governmental background: they were established by the Ministry of Civil Affairs and its
local agencies accordingly.8 In other words, CCF and its local affiliates are actually
“government-organized nongovernmental organizations” (GONGOs). Over the years, CCF has
developed a very extensive and powerful hierarchical network across multiple levels of
jurisdictions. As of June 2012, CCF has established nearly 2,000 local affiliates at the county
level or above; it has even created local affiliates at the village or street level in some
communities. Relying on administrative means to acquire funds, their funding sources include
government grants, corporate contributions, and public fundraising.
There also exist a small number of independent, public fundraising foundations (e.g., One
Foundation in Shenzhen) and non-public fundraising foundations (e.g., Guangdong Harmony
Foundation). As discussed earlier in the paper, unlike most other grantmaking foundations, U.S.
community foundations build up their endowment funds and other resources gradually from
many donors in the local geographic community, and work to improve the quality of life for all
people in a defined area. Examined against the U.S. definition, these foundations likely would
not qualify as community foundations. In the case of One Foundation, for example, although its
funds come mainly from the local community, its service area is not limited to the local
community but rather extended to all parts of the country. In the case of Guangdong Harmony
Foundation, the service area is limited to a broadly defined community, but the fact that it is not
eligible for public fundraising makes it extremely difficult to diversify its funding portfolio.
For the purpose of this study, we propose the following working definition for
community foundations in the Chinese context: community foundations are place-based
8
The current president of CCF, Mr. Baojun Fan, is a member of the Standing Committee of the Chinese People's
Political Consultative Conference (CPPCC), and former Deputy Secretary of Party Leadership Group and Deputy
Minister of Civil Affairs.
7
philanthropic organizations that pool funds from local sources and allocate grants in response
to local needs. This inclusive definition is intended to serve as a point of departure for
stimulating discussion among scholars and practitioners on Chinese community foundations; it is
our hope that a more rigorous definition will be developed down the road.
Drawing upon the above definition, in theory we can further place a community
foundation into one of the following four categories by considering whether the foundation has
the public fundraising status (the x-axis) and whether it is affiliated with the government (the yaxis), as shown in Table 1:
---------------------------------------Insert Table 1 about Here
---------------------------------------In practice, however, “government-affiliated, private community foundations” do not
exist, as all government-affiliated foundations are eligible for public fundraising. We have not
been able to identify a community foundation that falls into the category of “independent, public
community foundations.” As we will show in the next sections, examples of community
foundations are available for the other two categories: government-affiliated, public community
foundations; and independent, private community foundations.
Survey of the Landscape of Community Foundations in China
How many community foundations are out there in China? A useful start for surveying
the landscape of community foundations in China is to search some existing databases for
organizations that would fit our definition. One such database is the Community Foundation
Atlas (CFA) (http://communityfoundationatlas.org), which provides the names, locations and
year of establishment for over 1,800 community foundations around the globe. A search of this
8
database, however, indicated that it contains only two Chinese organizations: Guangdong
Harmony Foundation and Shanghai Charity Foundation. Clearly, the CFA database has very
minimal information about community foundations in China.
Another database is hosted by the China Foundation Center (CFC). CFC is a legally
registered public charity, referred to as the world’s leading source of information on Chinese
philanthropic foundations. We were able to retrieve a list of foundations under the category of
“community” from the CFC database (see Table 2).
---------------------------------------Insert Table 2 about Here
---------------------------------------Surprisingly, this short list contains only 30 community foundations, however defined by
CFC. Helpful as it is, there are several problems with the CFC list. First, over two thirds of the
organizations on this short list come from one province (Jiangsu), which raises concerns about
the comprehensiveness and reliability of the data. Second, it is unclear how CFC defines a
community foundation, but some community foundations on the list do not seem to fit neatly into
our working definition, nor are they recognized by scholars and practitioners as community
foundations in a real sense. For example, Taoyuanju Community Development Foundation
(TCDF) is referred to by some as the very first community foundation established in China.
However, as our assessment reveals, it is actually a corporate foundation as it relies on gifts from
a for-profit corporation—Li International Investment (Shenzhen) Group, Co., Ltd.—as a single
major source of funding. Similarly, the Social Foundation of Jimei District9 relies on gifts from
9
厦门集美社公业基金会.
9
Jimei Bank (Chiyu Bank), a banking corporation founded by the late patriotic overseas Chinese
leader Chen Jiageng (Tan Kah Kee).10
As shown above, the existing databases fall short of providing a satisfactory answer to
the question “how many community foundations currently exist in China?” While it is beyond
the scope of this paper to draw a complete picture of the community foundation sector in China,
we did make an effort to identify all the government-affiliated public community foundations
that currently operate in Jiangsu, an eastern coastal province (see Table 3).
---------------------------------------Insert Table 3 about Here
---------------------------------------To generate this list, we focused mainly on the numerous charity foundations that had
been converted from the affiliated organizations of China Charity Federation (CCF). We
excluded the provincial and local affiliates of China Education Development Foundation11,
China Legal Aid Foundation12, and China Samaritan Foundation13, in Jiangsu Province. We also
excluded some independent foundations that have a narrower focus on than the community at
large, either in terms of functional focus (e.g., Lingshang Compassion Foundation of Wuxi
City14) or geographical focus (e.g., Neighborhood Assistance Foundation of Zhujiang Alley,
Jiangsu Province15). Even with these exclusions, we were able to generate a list of 41
government-affiliated community foundations (charity foundations) in Jiangsu Province alone.
10
Today, Bank of China (Hong Kong) holds a majority stake in Jimei Bank; the rest of the bank is held by the Jimei
University Foundation, the municipal government of Xiamen, and minority shareholders.
11
中国教育发展基金会 (http://www.cedf.org.cn).
12
中国法律援助基金会 (http://www.claf.com.cn).
13
中华见义勇为基金会 (http://www.cjyyw.com).
14
无锡市灵山慈善基金会.
15
江阴市朱蒋巷帮扶基金会.
10
This strong presence of community foundations in Jiangsu is not entirely surprising:
above all, Jiangsu is one of the wealthiest provinces in China, boasting the highest GDP per
capita of all Chinese provinces. There will likely be fewer community foundations in provinces
with a weaker economy, especially those western provinces. Even after taking into consideration
the economy factor, however, it seems reasonable to estimate that the total number of community
foundations is at least in the hundreds, far more than the 30 foundations included in the CFC list.
Case Study: Guangdong Harmony Foundation
In contrast to government-affiliated community foundations, the number of independent
community foundations is very limited. We have only been able to identify two foundations for
the “independent, private community foundation” category,16 and found none for the
“independent, public community foundation” category. In order to know more about this small
group of independent community foundations, an in-depth case study was conducted on
Guangdong Harmony Foundation (GHF) during the summer of 2014. Semi-structured interviews
are conducted with key individuals from the organization and its stakeholders. The selected
interviewees include board members, the executive director, senior staff members, and
collaborative partners of the foundation. An interview guide, with a list of fully worded
questions to be explored with each participant, has been developed based on the relevant
literature and previous research. Questions cover fund development, grant allocation, governance
and management practices, and major programs and initiatives. In addition to individual
interviews, archival data analyses have also been used to provide a measure of validity through
data collection method triangulation. The relevant organizational archives include organizational
16
The two foundations are Guangdong Harmony Foundation (广东省千禾社区基金会) and Gonghe Community
Development Foundation (成都公和社区发展基金会).
11
bylaws, organizational reports such as quarterly briefings and annual financial reports,
newspaper articles, and organizational web sites, among others.
Our analysis adopted the inductive model of thinking, forming categories and identifying
patterns from the qualitative data (Creswell, 1994). From the interview data emerged three
themes: the conceptualization of community foundation, the awareness and assessment of
alternative community foundation models, and the process of GHF’s strategic evolution that
entailed three distinct stages. These themes were generalized through careful inductive analysis:
they were not imposed prior to data collection but came from the interviews with the participants
and archival data (Janesick, 1998). One important component of the process of inductive analysis
involves “the presentation of the data in narrative form supported by evidence from the
statements and behaviors recorded in the notes and interviews. In other words, the researcher
makes empirical assertions supported by direct quotations from notes and interviews” (Janesick,
1998: 46).
Founded in September 2009, GHF is officially registered as a private foundation under
the Department of Civil Affairs in Guangdong Province. GHF’s mission is to “support emerging
nonprofit organizations” and “promote innovative community development” through “innovative
approaches, accountable attitude, and cooperative pattern.” Its vision is to “build up a world of
justice, integrity, caring, and vitality.”
Conceptualizing Community Foundation
GHF considers the Pearl River Delta region17 as its target community. In the past few
years since it came into being, GHF has developed a unique understanding of community
17
Pearl River Delta is the low-lying area surrounding the Pearl River estuary where the Pearl River flows into the
South China Sea. A heavily urbanized region with a population of over 57 million, it is one of the main hubs of
China's economic growth. For more details about Pearl River Delta, see:
http://en.wikipedia.org/wiki/Pearl_River_Delta.
12
foundations that contains three key characteristics. First, the community foundation mobilizes
resources from the local community. GHF once hoped to obtain a major corporate or individual
gift, but was not able to find a committed donor. As the leaders of GHF were looking around for
other options, the community foundation model caught their attention as a viable solution to
GFH’s resource bottleneck. The following excerpt from the interview with Executive Director
explains the localness of resource acquisition:
“Indeed, why not try fundraising locally? We could resort to the media that may act as
intermediaries. Local business ventures also have resources. And there are many other
foundations in the same region that may have interest in the same programs as we do, so
we may work together on those programs. Overall I think the most distinct feature of
GHF is the localness of its funding sources. All the funding of GFH now comes from the
Pearl River Delta, while in the past we had to rely on the donations of board members
(who did not necessarily reside in this region).”
Second, the community foundation bridges community resources and needs. At the heart
of this bridging role is a culture of professionalism and service orientation on the part of
foundation staff. As the Executive Director reasons,
“Community foundation should no longer be a grant-making institution. Rather, it should
be a service organization and all employees of GHF should become servers. Whom to
serve? Serve the community that has needs, serve other organizations that also provide
support and service to the community, and serve our donors. Others donated to GHF
because we are professionals and we can make the best use of the donated resources. On
the other hand, with us playing the bridge role, the needs of the community can be better
met. Overall, at GHF we changed our mentality, that is, we viewed ourselves as a service
13
organization and abandoned the arrogance people usually see in a fund-providing
organization.”
Third, the community foundation facilitates the participation of community stakeholders
in program design and implementation. Whenever GHF started working in a local community, it
always managed to get the local stakeholders involved. As the Executive Director noted,
“Here is my understanding of the community foundation: it is not a particular foundation
type, but rather a particular type of mindset or operating model. It represents a particular
way of thinking [that is, working closely with multiple stakeholders to bridge community
resources and needs].” It does not matter whether the focal foundation is a public fundraising foundation or a private one; as long as it leverages its resources and expertise to
address community issues by partnering with stakeholders, then in my view it is
operating in the spirit of a community foundation.”
Awareness and Assessment of Alternative Identities (Models)
The GHF leaders recognized the existence of alternative models of community
foundations. For example, public fundraising foundations such as the local affiliates of charity
foundations represent such a model. They are closely affiliated with government, usually operate
in a top-down manner, and rely on administrative means to raise funds; some of them have active
programs, and few of them have the mindset of a community foundation. However, they fit well
with our working definition of community foundations in that resources coming from and are
used for the local community.
The following excerpt about charity foundations exemplifies well this line of reasoning:
“The fund they raised (regardless of being voluntary or not) all came from ordinary
residents of [the local community], local enterprises, government employees, some
14
foundations named after local businesses and so on. How was the money spent? Similar
to the conventional way of charity, the money was used to help the ill, poor, handicapped,
and/or uneducated people who were also living in [the local community]. This is more
like a community foundation. Therefore, I actually do not think existing foundations can
be identified as community foundations. Instead some local charity organizations show
more characteristics of a community foundation we usually defined.”
With regard to functional focus, charity foundations usually focus on the provision of
basic social welfare, a function that otherwise would have been provided by the government.
Very few of these foundations seem to have a broader vision in response to the ever-changing
needs in the community. Yet these foundations do play an important role in the community,
especially in some special cases:
“Consider an example of a child with leukemia. The child’s life may have been saved
with the money of local charity organization. If they had applied to GHF for funding, we
probably wouldn’t be able to offer such help.”
Therefore, although leaders of GHF did not identify with the philosophy and operating model of
charity foundations, they nonetheless recognized the value of these organizations.
The Strategic Evolution of the Foundation
Over the years, GHF’s strategic focus has evolved through three stages: the “Harmony
Fund” stage, in which GHF operated as a special fund giving out small grants to grassroots
nonprofits; the “grant-making” stage, in which GHF operated as a private grant-making
foundation; and the “collaborative leadership” stage, in which GHF transformed itself into a
community leader that collaborated with multiple stakeholders in the development of a wide
variety of philanthropic initiatives.
15
Stage one: the “Harmony Fund” stage (prior to 2009). Prior to its official registration,
GHF already existed in the form of a special fund called “Harmony Fund” under the Sun YatSen (Zhongshan) University Institute of Civil Society (ICS)18. GHF’s operating budget was
approximately RMB500, 000, coming from the donations of its co-founders and board members.
As the Executive Director recalled,
“We used the money primarily for making grants; around that time very few
organizations would do the same. We offered three types of grants, all of which were
pretty advanced and innovative even when we look back from today. One type of grant
was what we called the Winged Horse Fund, which, similar to Ashoka, supported
individuals. The second type was what we labeled as the Bridge Fund. Back then, a lot of
grassroots nonprofits in China relied on foreign funding sources to survive and operate
(because no domestic funding source available). A gap period would emerge when one
program was completed but the funding for another program hadn’t arrived yet. During
such a period of time, these nonprofits would have difficulties in even paying rents or
employee salaries. Our funding was to support them through the gap period between their
primary (usually foreign) funding sources. The third type was called “seed fund,” which
we offered to those new organizations so that they could start up their operations.
During that period of time, the three aforementioned smaller funds were very novel ideas. They
began providing small grants to grassroots nonprofits when few other philanthropic institutions
even considered such practices. It is from GHF’s special fund that many organizations in the
Pearl River Delta obtained their first domestic funding support.
18
ICS formerly is Research Center for NGOs in South China (RCNSC). It was jointly founded by Sun Yat-Sen
University Research Institute for Guangdong Development and the South China Program of the Hong Kong Institute
of Asia-Pacific Studies. Headquartered in Sun Yat-Sen University, RCNSC consists of different research programs
for specific fields, such as NGO research, collective action research and corporate citizen research. More
information of ICS can be found at: http://www.chinacsrmap.org/Org_Show_EN.asp?ID=560.
16
Stage two: the “Grant-making” stage (2009-2012). When GHF was established
formally in the year of 2009, its founders included business people and scholars/public
intellectuals. Since then, the foundation began to grow steadily. GHF had only five board
members initially, but more and more members joined the board gradually. As the Executive
Director noted during one of the interviews,
“GHF was a grant-making foundation with a small budget size, but why was it so
influential? Because nobody was doing the same thing! Funding of even only RMB10,
000 was unprecedented (for lots of grassroots organizations).”
Two main factors provided the impetus for GHF’s formal registration in 2009. First was
the need to increase the capacity of the foundation to meet the fast-growing demand in the
community. GHF had received an increasing number of grant applications every year. For
example, an organization in Lanzhou (a major city in a northwestern province) once applied for
funding of RMB10, 000 from GHF. The organization had to come all the way from the remote
northwest to the very southern Guangdong to apply for such a small amount of funding, because
no funding support was available elsewhere in mainland China; all funding sources were from
foreign countries. With an operating budget of only RMB500, 000, GHF (still a special fund
back then) could hardly meet the demands; ICS, the original supervisor of GHF, was not large
enough to carry so many functions --- after all, it was only a research center within a university.
Therefore, the leadership needed to think about new ways of mobilizing and leveraging more
social resources; the establishment of GHF as an independent foundation offered such an option.
The other factor is the new policy that made it feasible to register as independent legal
charities. Prior to 2009, a dual-control system under the previous legal framework required most
nonprofit organizations not only to register with the Ministry of Civil Affairs, but also to be
17
affiliated and supervised by a public agency in its functional area (Wang & Jiao, 2003). Usually,
a foundation would need a supervisory agency in order to be formally registered. For example,
the Education Foundation of Sun Yat-Sen University was sponsored by the Department of
Education of Guangdong Province. As Guangdong Province started to change its policies on the
registration of social organizations, the most important of which was to allow organizations to
register without a supervisory agency, GHF took the opportunity to become the first officially
registered foundation in Guangdong that is truly independent.
Stage three: the “Collaborative Leadership” stage (2012-present). Up to the years of
2011 and 2012, both the domestic and external environments changed significantly, especially
the external environment. A variety of strong funding sources emerged and became the
mainstream support: government contracts, special funds to support civil organizations, largescale private foundations such as the Li Ka Shing Foundation (LKSF)19, and resourceful
grantmaking foundations such as the Yu Foundation20, to name just a few.
This changing environment posted a challenge to the leadership of GHF: facing the
competition from other (much larger) funders, how should this young and small foundation
adjust its strategy to maximize social impact? The Executive Director reflected on this transition,
“With a small operating budget, we wouldn’t be able to stay influential if kept making
small grants. We received a large number of applications, of which we could support only
a small portion. In 2012, we were running a deficit. For example, we had only 1 million
on the book, but we offered 1.2 million funding support. The 200K deficit would be
carried forward into the next year. If the programs cannot be carried forward as well, we
would need to use other sources of funding such as administrative fund to support the
19
20
李嘉诚基金会 (http://www.lksf.org/).
与人基金会 (http://www.yufoundation.org.cn/).
18
programs first. This way of operation was not sustainable at all. Again, if we continued
giving out small money to a large pool of applicants, sort of like sprinkling peppers, our
value and social impact would be extremely small.”
Indeed, a strong sense of urgency was felt among the GHF leaders:
“GHF must reinvent its strategy; otherwise it will soon be gone. You have a total budget
of one or two million RMB, while others are giving out grants in the amount of ten
million; so they are doing much better (in terms of both resource acquisition and grantmaking)…But then what should we do? We should re-examine our strategy. We have no
money, no power, and no patronage from business ventures. What is the solution?”
As they were struggling with the idea of strategic transformation, the GHF leaders
noticed an interesting contrast: whereas institutional philanthropy became very popular in
Guangzhou (the provincial capital city), it was much quieter in other smaller cities in the Pearl
River Delta region. Foshan, a prefecture-level city with a strong economy in central Guangdong,
fell onto their radar. They paid a visit to Foshan, where they developed a collaborative
philanthropic program with Foshan Media Group to host the Foshan Charitable Project Contest.
The Contest was well received. This successful collaborative experience opened up the eyes of
the GHF leaders to a new strategy. The keyword of this new strategy is “collaboration.”
Today, GHF has six full-time paid staff members, with a budget of about RMB850, 000
for administrative expenses, including leasing, utilities, and personnel salaries. The overall
budget is RMB11 million. From 2010 to 2013, its annual budget remained above RMB10 million,
except for the year of 2009. Although the budget has been pretty much the same in the past few
years, GHF’s internal structure has changed greatly:
19
“In 2010 a majority of our programs were escrow programs---at that time the escrow
programs from Guangzhou Subway alone were sized roughly at RMB 6million. But the
Subway escrow programs decreased year by year, while our expenses on other types of
programs increased significantly, which changed our internal structure in a fundamental
way. To give you a rough estimate of proportions. In the past, within our 11million
budget, probably only 1 million could be fully controlled by GHF and the rest was
escrow programs. But now escrow programs probably are about the size of 3 million, and
on the remaining budget GHF can make independent decisions. For example, for the
Foshan Charitable Project Contest, GFH played a very active role in program funding
decisions, instead of providing only escrow program service.”
In sum, GHF has repositioned its strategy to focus on playing a collaborative leadership
role by convening community stakeholder and engaging them into partnering with GHF in the
design and implementation of major philanthropic initiatives. As such, GHF has been able to
leverage its (still quite limited) grant-making capacity to collectively make a stronger impact on
the community.
Discussion and Conclusion
This study contributes to the existing literature by providing a first assessment of the
conceptualization, scope, and function of community foundations in China. To facilitate current
and future research, we provide a working definition and developed a typology of Chinese
community foundations. Our empirical analysis reveals the co-existence of two distinctive
identities (or models) among the first cohort of community foundations in China: the community
foundation as government-led social reform, and the community foundation as civil society-led
social innovation. This co-existence of dual identities in the community foundation movement
20
reflects the on-going tension between the Chinese civil society and government. As Guo and
Zhang (2013) point out, the Chinese government is becoming more open to the idea of having
nonprofits provide needed services to communities, but at the same time is exerting its influence
to “herd the sheep,” discouraging nonprofits from influencing public policy, mobilizing people,
and promoting social change.
Within this context, will the top-down and bottom-up approaches merge as the
community foundation sector continues to grow, or will the former eventually crowd out the
latter? Salamon and Anheier’s (1997) observe that authoritarian political regimes leave little
room for a truly independent nonprofit sector in these societies. If this observation still holds true,
then it pains a dim future for independent community foundations. However, our case study
illustrates how a civil society-led community foundation has adapted to a changing environment
by constantly experimenting with new philanthropic strategies. The success of their new
strategy—one that is featured by collaborative leadership and stakeholder participation—
suggests a promising new direction for other independent community foundations that aspire to
take a bottom-up approach to community development and social change.
In light of the rapid growth of community foundations around the world and the
blossoming of community foundations in China, we hope our findings will stimulate more
discussions and research on this subject. Our study indicates several possible directions for future
research. One direction is related to resource acquisition. Community foundations – and their
donors – make a long-term commitment to their community. In the United States, this has been
through the creation of endowments and donor-advised funds: the endowment money stays with
the foundation in perpetuity, because the foundation keeps the principal donation and spends
only the earnings; the donor funds, on the other hand, are totally expendable. Our research
21
indicates that the endowment option is almost completely missing in the current practice of
community foundations. It would be interesting to explore the different ways of acquiring
resources by community foundations in China, where the financial systems are fragile and the
regulatory environment is not necessarily conducive to the growth of this new form of
philanthropy.
A related area of future research is grant-making. Compared with other philanthropic
institutions, a potential strength of community foundations is that their grantmaking is based on
detailed knowledge of their communities and expertise in addressing a wide variety of emerging
and changing needs. How and to what extent is this potential realized among Chinese community
foundations? What are the practices and mechanisms by which community foundations conduct
community needs assessment?
Another issue that we briefly touched on but did not further explore is the issue of board
governance. Guo and Brown (2006) note the tendency among the leaders of U.S. community
foundations to focus more attention on the development and management of assets than grantmaking. Within this context, community foundation boards tend to be treated as fund-raising
mechanisms rather than grant-making entities. In a subsequent study, Brown and Guo (2010)
observe that community foundation boards are not fully engaged in developing strategy as much
as staff might desire such insights. To some extent, findings from our case study seem to echo
the observation that the board is committed to fundraising, but they also offer evidence that the
board is engaged in the strategic development of the foundation. Future research is needed to
better understand the role of board governance in the effectiveness of community foundations.
22
References
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Voluntary Sector Quarterly, 39(3), 536-546.
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development. Nonprofit Management & Leadership, 12(1), 7-24.
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strategy for community foundations. Keynote Address at the Community Foundation
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24
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25
Table 1
A Typology of Chinese Community Foundations
Public Fundraising Status
No
Yes
Yes
Government-Affiliated
Private Community
Foundation
Government-Affiliated
Public Community
Foundation
Not Available
(e.g., Yangjing Community
Foundation/上海洋泾社区公
益基金会)
Independent, Private
Community Foundation
Independent, Public
Community Foundation
(e.g., Guangdong Harmony
Foundation/广东省千禾社区
基金会; Gonghe Community
Development Foundation/成
都公和社区发展基金会)
Not Available Yet.
Government
Affiliation
No
26
Table 2
Community Foundations in the China Foundation Center Database
No. Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Taoyuanju Community Development Foundation (桃源居公益事业发展基金会) Liaoning Provincial Non-Profit Foundation (辽宁省公益基金会) Charity Foundation of Dalian City, Liaoning Province (大连慈善基金会) Charity Foundation of Bayujuan District, Yingkou City, Liaoning Province (营口市鲅鱼圈区慈善基金
会) Shanghai Charity Foundation (上海市慈善基金会) Charity Foundation of Wuzhong District, Suzhou City, Jiangsu Province (苏州市吴中区慈善基金会) Charity Foundation of Xinghua City, Jiangsu Province (兴化市慈善基金会) Charity Foundation of Binhu District, Wuxi City, Jiangsu Province (无锡市滨湖区慈善基金会) Charity Foundation of Xinyi City, Jiangsu Province (新沂市慈善基金会) Charity Foundation of Chongchuan District, Nantong City, Jiangsu Province (南通市崇川区慈善基金
会) Charity Foundation of Jingjiang City, Jiangsu Province (靖江市慈善基金会) Public-Benefit Foundation of Juqiao Village, Jiangsu Province (张家港市巨桥惠民基金会) Charity Foundation of Qidong City, Jiangsu Province (启东市慈善基金会) Charity Foundation of Dongtai City, Jiangsu Province (东台市慈善基金会) Public-Benefit Foundation of Yonglian Village, Jiangsu Province (张家港市永联为民基金会) Benevolence Foundation of Wenming Village, Jiangsu Province (海门文明村爱心基金会) Public-Benefit Foundation of Hanshan Village, Jiangsu Province (张家港市韩山福民基金会) Public-Benefit Foundation of Nonglian Village, Jiangsu Province (张家港市农联爱心基金会) Charity Foundation of Dafeng City, Jiangsu Province (江苏省大丰市慈善基金会) Charity Foundation of Kunshan City, Jiangsu Province (昆山市慈善基金会) Charity Foundation of Huaian City, Jiangsu Province (淮安市慈善基金会) Neighborhood Assistance Foundation of Zhujiang Alley, Jiangsu Province (江阴市朱蒋巷帮扶基金会) Charity Foundation of Jinchang District, Suzhou City, Jiangsu Province (苏州市金阊区慈善基金会) Charity Foundation of Gangzha District, Nantong City, Jiangsu Province (南通市港闸区慈善基金会) Charity Foundation of Huangyan District, Taizhou City, Jiangsu Province (台州市黄岩区慈善基金会) New Rural Area Development Foundation of Siqian Village, Jiangsu Province (浙江泰顺司前新农村发
展基金会) Social Foundation of Jimei District, Xiamen City, Fujian Province (厦门市集美社公业基金会) Xiao Huasong Charity Foundation, Pingdong Road, Shantou City, Guangdong Province (汕头市平东肖
华松慈善基金会) Guangdong Harmony Foundation (广东省千禾社区公益基金会) Gonghe Community Development Foundation, Chengdu City, Sichuan Province (成都公和社区发展基
金会) 27
Table 3
Government-Affiliated Public Community Foundations in Jiangsu Province
No. Name
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
Charity Foundation of Changshu City (常熟市慈善基金会)
Charity Foundation of Dafeng City (大丰市慈善基金会)
Charity Foundation of Dongtai City (东台市慈善基金会)
Charity Foundation of Gaoyou City (高邮市慈善基金会)
Charity Foundation of Haian County (海安县慈善基金会)
Charity Foundation of Haimen City (海门市慈善基金会)
Charity Foundation of Huaian City (淮安市慈善基金会)
Charity Foundation of Chuzhou District, Huaian City (淮安市楚州区慈善基金会)
Charity Foundation of Jingjiang City (靖江市慈善基金会)
Charity Foundation of Kunshan City (昆山市慈善基金会)
Charity Foundation of Lianyungang City (连云港市慈善基金会)
Charity Foundation of Haizhou District, Lianyungang City (连云港市海州区慈善基金会)
Charity Foundation of Lianyun District, Lianyungang City (连云港市连云慈善基金会)
Charity Foundation of Xinpu District, Lianyungang City (连云港市新浦区慈善基金会)
Charity Foundation of Lianshui County (涟水县慈善基金会)
Charity Foundation of Nantong Economic & Technological Development Zone (南通开发区慈善基金
会)
Charity Foundation of Nantong City (南通市慈善基金会)
Charity Foundation of Chongchuan District, Nantong City (南通市崇川区慈善基金会)
Charity Foundation of Gangzha District, Nantong City 南通市港闸区慈善基金会
Charity Foundation of Tongzhou District, Nantong City 南通市通州区慈善基金会
Charity Foundation of Pizhou City (邳州市慈善基金会)
Charity Foundation of Qidong City (启东市慈善基金会)
Charity Foundation of Rugao City (如皋市慈善基金会)
Charity Foundation of Sheyang County (射阳县慈善基金会)
Charity Foundation of Suzhou National New & Hi-tech Industrial Development Zone (苏州高新区慈善
基金会)
Charity Foundation of Suzhou Industrial Park (苏州工业园区慈善基金会)
Charity Foundation of Suzhou City (苏州市慈善基金会)
Charity Foundation of Canglang District, Suzhou City (苏州市沧浪区慈善基金会)
Charity Foundation of Jinchang District, Suzhou City (苏州市金阊区慈善基金会)
Charity Foundation of Pingjiang District, Suzhou City (苏州市平江区慈善基金会)
Charity Foundation of Wuzhong District, Suzhou City (苏州市吴中区慈善基金会)
Charity Foundation of Xiangcheng District, Suzhou City (苏州市相城区慈善基金会)
Charity Foundation of Suining County (睢宁县慈善基金会)
Charity Foundation of Taicang City (太仓市慈善基金会)
Charity Foundation of Binhu District, Wuxi City (无锡市滨湖区慈善基金会)
Charity Foundation of Wujiang city (吴江市慈善基金会)
Charity Foundation of Xinyi City (新沂市慈善基金会)
Charity Foundation of Xinghua City (兴化市慈善基金会)
Charity Foundation of Xuzhou City (徐州市慈善基金会)
Charity Foundation of Zhangjiagang Free Trade Zone (张家港保税区慈善基金会)
Charity Foundation of Zhangjiagang City (张家港市慈善基金会)
28