China’s Third Sector Observation Report (2019) released

The “China Third Sector Observation Report (2019)”, published jointly by Renmin University’s China Charity Innovation Research Institute and the Public Domain Management Consulting, was released on July 29th.

This report has been released annually since 2011, setting up a platform for research, observation, interpretation and understanding of the third sector, further promoting its healthy development. One of the chapters of the report is entitled “the Choice Between Justice and Interest: the Charity-Business Relationship”, and it explores the phenomenon of the “commercialisation of charity”. It was written by Professor Kang Xiaoguang, a Renmin University professor who focuses on the nonprofit sector. Professor Kang is well-known for his opposition to the “commercialization” of China’s charity sector, and in 2017 he got into a ferocious dispute with the director of the Narada Foundation Xu Yongguang over this topic.

 

Bad tendencies in the charity field

In the report, professor Kang claims that since the Reform and Opening Up market forces have destroyed the previous public welfare model and gradually established a new model. Especially in the past ten years, extensive and in-depth integration has brought about the “dispersion” of charity. Elements of charity have been integrated into all aspects of personal and social life (including commerce); charity has also absorbed elements from other fields (including business) to make itself richer, more effective, and more prosperous.

In general, the relationship between the charity sector and business is a benign one. However, with the deepening of market-oriented reforms, capital has steadily established its hegemony over the field of charity in China, and the intensified “commercialization” has led the sector to deviate from the right path. There is a trend of thought that sees things from a commercial perspective, questioning the efficiency and sustainability of charity, denying the rationality and legitimacy of morality, and denying even the possibility of altruism for its own sake.

 

What is a healthy relationship between public interest and business?

The report further claims that, concerning the relationship between charity and business in the capitalist era, the concept of “righteousness and interests should both be taken into consideration, and interests should be carried forth according to justice”: promoting altruism, respecting and protecting reasonable self-interest; and most importantly, using altruism to domesticate the greed released and strengthened by the market, and using charity to domesticate profit. Therefore, a timely social enterprise movement should involve enterprises moving towards charity, and not charity getting close to commerce; it should be the result of charity leading business, and not the result of private enterprise influencing charity.

Professor Kang criticises the mainstream neoliberal model of charity, and claims that a healthy relationship and integration between charity and business should be based on charity, with charitable elements penetrating the commercial field, and business becoming more altruistic. At the same time, charity can draw on some commercial technologies to improve its management and operational performance.

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