This is a translation of an article originally published on CDB’s Chinese website (see the original here). It talks about the Blue Book of Philanthropy (2018), which was produced by the Chinese Academy of Social Sciences.
As Yang Tuan, the chief editor of the Blue Book of Philanthropy (2018), says: “In 2018, charity in China struggled to move forward in the face of difficulties, but despite this its foundations have been stabilized and a new scene has appeared. From the top-down perspective, 2018 was the year for social organizations to strengthen their governance; from the bottom-up perspective, it was the year for charity to return to its original ethical spirit and leave materialism behind.”
On July 13, 2019, the book launch of the Blue Book of Philanthropy (2019) and the Chengdu Public Charity Forum were held jointly in Chengdu, Sichuan. Nearly 80 people from the charity sector, academia, enterprises, media and the government took part in the event. Guided by the Center for Social Policy Studies of the Chinese Academy of Social Sciences and the Social Sciences Academic Press (China), the forum was co-sponsored by the China Lingshan Council for the Promotion of Philanthropy and the Chengdu Charity Federation, and hosted by the Sichuan Red Cross Foundation Waiting for Smile Fund and the Yibin Cheilopalatognathus Charity Hospital (Yibin Stomatological Hospital), and co-organized by Chengdu Science and Technology Journalism Society.
After the opening ceremony, Yang Tuan, a researcher at the Institute of Sociology of Chinese Academy of Social Sciences, consultant of the Center for Social Policy Studies, and the editor-in-chief of the Blue Book of Philanthropy: Annual Report on China’s Philanthropy Development (2019), officially released the Blue Book and gave some thoughts on the big data and development of charity in China.
Taking Stock of the Big Data and Development Trends of Chinese Charity in 2018
In 2018, the rule of law for charity in China has moved towards standardization and systematization. It is also a year when China’s charity sector has faced major challenges. Despite these difficulties, China’s charity has made great efforts to not only strengthen its foundation, as the total amount of organizations and charitable donations has continued to grow, but it has also made progress in the areas of volunteer services, community social organizations, sectorial construction and innovation.
Meanwhile, bright spots for charity in China have also appeared frequently in 2018. Due to the formal implementation of the Volunteer Service Regulations, the construction of volunteer service institutionalization has been strengthened all-round. China has incorporated volunteer services into the overall plan for national economic and social development, which has brought tremendous opportunities for the development of volunteer services. In 2018, the total number of volunteers in China was about 198 million, accounting for 14% of the population in Mainland China. The number indicates an increase of 4.03 million people, with a 25% growth rate over 2017. Volunteers contributed 82.36 billion Yuan, with an increase of more than 50% over 2017.
In terms of the numbers of volunteer service organizations, compared with 730,000 in 2013, the number increased to 1,433,000 in 2018, with a cumulative growth rate of 95% over the intervening years. However, the growth rate has slowed down to less than 10% in recent years, and the life cycle of volunteer service organizations is shorter than five years in over 60% of cases.
According to the public service platform of Chinese social organizations, the total number of social organizations in China exceeded 816,000 at the end of 2018, including 366,000 social organizations, 443,000 social service institutions and 7,027 foundations.
Nurturing community social organizations has become a key policy of the state for the first time, with the government giving the order and the localities all responding. In addition, the strategic enhancement of the internationalization of social organizations not only promotes joint action to integrate resources, improve efficiency and influence, but also breaks through cross-country cooperation, starts to focus on regional cooperation, and moves towards participating in the construction of “promoting a regional community with a shared future”.
Sectorial construction has shown cumulative results over the years. New breakthroughs have been made in accountability and self-discipline, providing consultants, training, capacity-building and technical support to resource providers, research and knowledge management, communication, and information dissemination. Furthermore, new methods and approaches have emerged for the study of the economic scale (N-GDP) of China’s social organizations.
Innovations in charity through the Internet are continuing to develop. On one hand, Internet charity is moving towards a new stage of maturity and rationality; on the other hand, with the emergence of a new charity focused on economic problems, Alibaba has listed poverty alleviation as a strategic business for the company. Alibaba plans to invest 10 billion Yuan and mobilize every unit of the IT giant’s system to explore ways to help poverty-stricken areas eliminate poverty at its root by looking at the five areas of e-commerce, ecology, education, women and health.
The strategic enhancement of the internationalization of social organizations not only promotes joint actions to integrate resources, improve efficiency and influence, but also breaks through the boundary of cross-country cooperation, begining to experiment with regional cooperation and participate in “promoting a regional community with a shared future”.
The creation of an ethics of charity has been in the spotlight recently. The cases of the “frost boy” and the Wang Yafeng incident led charity circles to reflect on vulnerable children’s struggle for survival and education, as well as the professional and ethical boundaries of charity intervention. The public uproar caused by the sexual harassment scandals of public figures exposed in succession led them to reflect on the phenomena of frat culture, deferring to the boss, sectarianism and male chauvinism which accumulated during the sector’s rapid development, as well as on the lag in the development of an ethics of charity, and the vagueness and even displacement of charitable values. In thiw way they transformed the credibility crisis of the charity industry into an opportunity for collective review, reflection, education and construction, and initiated positive action to construct of a gender-friendly mechanism for the sector.
In 2018, 40 years after China’s reform and opening up began and 10 years after the Wenchuan earthquake relief, China’s non-governmental charity community launched various forms of commemorative activities, and systematically reflected on the gains and losses of China’s experimentation with philanthropy in modern times. The rise of non-governmental charity constitutes a great change for Chinese society. It reflects the practical experience that non-governmental appeals and government reforms can only make continuous progress by pooling the efforts from above and below and not neglecting either side. It is also the basic principle that the future development of charity in China will have to follow.
Why has the total amount of social donations in China not increased but decreased?
Many bright spots for charity in China have appeared in 2018, but it is worth noting the following: the total amount of social donations is about 118.2 billion, which represents a 26% drop. The total value of social public welfare is 326.52 billion Yuan, and the growth rate has declined. The number of social organizations is 816,000, and the growth rate has also declined.
The total growth rate of the three types of social organization (foundations, social groups, and social service organizations) is about 7%, out of which the social groups basically have the slowest growth rate, increasing by 3.1% over last year. The social service organizations have maintained a stable growth rate, increasing by 10.8% over last year. The growth rate of foundations is still the fastest among the three types of organizations; however the overall trend is downward, increasing by 11.4% than last year.
The Blue Book of Philanthropy (2019) points out that the main reason for this lies in the policy design of heavy supervision and strict registration, but the general trend towards opening up the registration of social organizations will not change, and the focus will be on the grassroots level. Due to the lag in the annual inspection of social organizations, the estimated amount of donations received by the three types of social organizations is obtained through measurements and calculations. Taking into account the overall socio-economic development and the development of social organizations, total donations to social organizations in 2018 are estimated to be 70 billion Yuan, of which the donations received by foundations were about 56 billion Yuan.
The growth rate of social organizations has slowed down, but the number of social organizations is still on the rise. In this case, why has the total amount of social donations in China not increased but rather decreased?
Tuan Yang, the editor-in-chief of the Blue Book of Philanthropy (2019), believes that there are two main reasons: on the one hand, with the launching of the official certification of charitable organizations and the guidance of government policies in recent years, the number of direct donations received directly by government departments has shown a sharp downward trend. Specifically, civil affairs departments have always been in an important position to receive social donations, but in recent years there has also been a downward trend. In 2017, the civil affairs system directly received 2.5 billion Yuan of donations from all walks of life, while in 2018 only about 800 million Yuan of donations were received.
Although they used to be the main recipient of donations, the civil affairs system now receives only around 1% of the country’s total donations. Due to the small amount of donations, the statistic system has gradually neglected the donating announcement. Furthermore, the situation of donations received by other organizations has not yet established a set of scientific, comprehensive, and credible statistic system. In addition, as uncertainty has matters, it is more and more difficult to estimate the total amount of social donations.
On the other hand, China has gradually established a pharmaceutical price benchmark system, and squeezed out the artificially inflated medicine prices. Material donations have accounted for about 30% of total donations over the previous years, out of which 90% were donations of drugs, medical equipment and medical devices. Therefore, the slash in the drug prices has affected the overall statistics on material donations. In a word, the price cut of the medical donations is a major reason for the decline in total donations in 2018.
In 2017 China proposed to stop hospitals from funding themselves through the sale of medicine, and improve the drug supply security system. This also means that the policy of medicine markups, which had been implemented for over 60 years, has formally been withdrawn, thus squeezing out the inflated medicine prices.
Affected by the aforementioned policy, the system of charity federations that mainly receive medicine for material donations will inevitably be affected. Taking part of the donations of medicine received by the China Charity Federation as an example, AstraZeneca- Tagrisso lowered their unit price in 2018, reducing the income from their donations by 759 million Yuan this year; Novartis-Tasigna lowered their unit price too, and the donation income decreased by 840 million Yuan in 2018; Novartis-Votrient lowered their unit price and donation income by 120 million Yuan in 2018; MerckSerono-Erbitux lowered their unit price and donation income by 220 million Yuan in 2018. In total, donations were reduced by 1.94 billion Yuan. Therefore, the overall amount of donations within the charity system was greatly affected, and its annual income from donations was estimated to be 22 billion Yuan in 2018.
Ten years of the Blue Book of Philanthropy
China’s philanthropy in 2018 reveals a general trend that reflects the different needs of various entities in the specific historical environment of China and has a wide-ranging impact on social life. The country is in the midst of a great change of a kind which global politics and economics has not seen in 100 years. Multiple uncertainties lead to frequent contradictions in Chinese social life, which grapples with the confrontation between the new and the old social structures accumulated in the 40 years reform and opening-up.
Tuan Yang believes that philanthropy in the future will be tense, more rigid than flexible; more centralized than decentralized, but it will also grow into a dynamic spiritual force with a tremendous impact. More attention should be paid to the power of philanthropic thought, which should explore the relationship between various charitable public welfare subjects in the new era. More importantly, we should reflect on charitable ethics, organizational construction and historical and cultural essence.
In 2009, Tuan Yang led the team that compiled the annual Blue Book of Philanthropy and published the first report. 2019 is the beginning of the second decade for the Blue Book of Philanthropy. Tuan Yang stresses that it is of great significance to choose Chengdu as the host of the first meeting of the Blue Book of Philanthropy in the new decade. She notes that China’s modern philanthropy reform actually started from the Wenchuan earthquake relief, while in the past decade, Chengdu and Sichuan’s philanthropy continued to develop and innovate.
Over the past decade, the Blue Book of Philanthropy has always been based on the frontline of national reform and development, observing and grasping the growth trends of charity in China, recording and analyzing modern charitable changes in the interaction of politics, the economy, society and culture. Over the years it has become an important reference for people from all walks of life in China and abroad to understand the development and characteristics of modern philanthropy in China.