Introduction

China’s economy has developed tremendously during the past three decades, lifting hundreds of millions out of poverty, building a national infrastructure, and becoming highly competitive in many global markets. Yet at the same time, there have been tremendous “growing pains,” problems that have emerged as a result of success as well as difficulties that have become more pronounced over time (Oi et al. 2010). These problems include an educational system biased toward urbanites, environmental degradation, and uneven access to quality health care. Moreover, China’s approach to economic development has been based on an enormous expansion of credit, which has led to growing debt among government agencies, companies and households. On top of this, China’s population is aging, and in all likelihood China’s economy will further slow in the coming decades. The cumulative result of these developments is a growing gap between the extent of these problems and the government’s ability to address them on its own.

Philanthropy has been held up as a central part of the solution to closing the gap between public needs and state capacity. With the meteoric rise in high net worth Chinese, a burgeoning middle class and hugely successful business sector, there is great potential for significant private involvement in the social space. At the same time, since Xi Jinping assumed the reins of the Chinese Communist Party (CCP) leadership in late 2012, there has been a general move toward greater centralization in the management of Chinese society. Thus emerges the current paradox of philanthropy and the state in China: a stronger social sector accompanied with growth in philanthropy is desired, but such strength and growth must be monitored and directed in ways that complement the state’s desired social agenda while limiting aspects of advocacy and civil society typically associated with the third sector elsewhere. This special volume seeks to explore these dynamics, in terms of the environment for philanthropy and the behaviors of philanthropic actors within this environment.

The purpose of this introductory article is multifold. The first is to provide the intellectual and empirical contexts in which our collective research is situated. We do so by analyzing the state of the existing research and the broad contours of philanthropic activity in China. The second is to situate our research initiative within the development of China’s own complex philanthropic studies and philanthropic community. The third is to introduce the scholarship that composes this special volume and its collective contribution to our understanding of philanthropic trends in China. On that foundation, we then provide additional original data and analysis about corporate philanthropic activity and foundations in China that complements the work of our collaborators. Finally, we consider the implications of the special volume for our understanding of philanthropy in theoretical and comparative perspectives and suggest potential avenues of future research.

Contextualizing This Special Volume

Conceptual Underpinnings of Our Initiative

In the broadest sense, philanthropy is defined as “voluntary action for the public good” (Payton 1988, p. 7). A more operational definition is provided by Lester Salamon (1992), with philanthropy framed as the private giving of time or valuables (money, security, property) for public purposes. Jon Van Til (1990, p. 34) draws on both values and operational aspects in the following conception of philanthropy as “the voluntary giving and receiving of time and money aimed (however imperfectly) toward the needs of charity and the interests of all in a better quality of life.”

Johnson and Saich (2017) note that the concept of philanthropy in contemporary China is predicated on practices and values around philanthropy in pre-modern China whereby “little distinction was made between charity (seen as the need to provide immediate relief to those in need or at times of crisis) and philanthropy (giving that is aimed at bringing about a more sustained, systematic improvement of society and public life). By these definitions the lion’s share of giving was clearly charitable” (p. 10). Their conclusion is that while pre-Mao philanthropy in China was diverse and pluralistic, it also had a paternalistic valence that reinforced the view that it was the role of the state to provide for social needs. In the context of contemporary China, Wang (2006) acknowledges the emergent institutional environment and state-private sector relationship but describes values that characterize the burgeoning philanthropic sector in China as being motivated by care, voluntary in nature, and oriented toward the leverage of other financial and human resources.

In this special volume, Salamon’s expansive definition is most germane for our purposes because philanthropic activity in China extends far beyond simple notions of charity to encompass addressing the provision of public goods, yet the relationship between philanthropic actors and the party-state is decidedly complex. Taking a broad view allows us to more neutrally observe the emergent actors, institutions, and approaches that have arisen in China’s contemporary philanthropic sector and the concomitant enabling or inhibiting environment surrounding them. Brinkerhoff (2004) notes that the challenges of studying philanthropy at the level of the nation-state relate to the complexities of the political economy, sociocultural factors, and regulatory and administrative structures that shape the environment of philanthropy. Thindwa et al. (2003) describe certain enabling external environments for civil society and philanthropy similarly. Together with the addition of internal factors, “explains that the health of an enabling environment depends on certain external conditions”, which we define as “accountability, representation, legitimacy, institutional and organizational capacities, self-regulation, and institutional relationships” (p. 4). In a similar vein, as this special volume is situated at the nexus of the state and the state of philanthropy, the papers in this collection are concerned with a range of philanthropic actors, substantive mission areas, types of funding, institutional matters, and environmental factors.

Growth of Philanthropy in China

When we set out on our multi-year collaboration in 2012 to better understand China’s philanthropic sector and place it in a broader intellectual context, there were approximately 450,000 legally registered nonprofit organizations, including both service organizations and foundations, in China. (For a thorough description of organizational forms in the Chinese legal context, see International Center for Nonprofit Law 2018a, b). By 2016, the number had grown to over 702,000, and by 2018, to over 832,000 (Ministry of Civil Affairs 2012a, 2016; Renminwang 2019). Estimates of nonregistered nonprofit organizations vary widely but are generally in excess of 1.5 million and as high as three million (Deng 2010; Johnson and Saich 2017). In 2012, there were 2820 registered foundations in China, including 1545 private foundations founded by individuals and companies, and 1275 public foundations created and run by government-related entities, representing a more than threefold increase from 2006 (United Nations Development Programme 2015). By 2016, the number of registered foundations had grown to 5521, including 3791 private foundations and 1730 government-affiliated foundations (Council on Foundations 2018).

In terms of charitable giving, the story is also one of growth, Total philanthropy in China was estimated as $13.5 billion in 2011, up from only $1.6 billion in 2006 (United Nations Development Programme 2015). Though year-to-year analyses of charitable donations in China reveal fluctuation, it is noteworthy that in 2014, the total amount of charitable giving from both foreign and domestic donors ($16.7 billion) exceeded that of 2008, the year of the tragic Sichuan earthquake, which resulted in a significant uptick in charitable giving (China Ministry of Civil Affairs 2016). And by 2017, total donations had risen another 38%, surpassing $22 billion (Zhou 2018).

Numerous reports in recent years also note the potential of high net worth philanthropy, including the report by Forbes (2016) on the number of billionaires, with China having 251, second only to the USA at 540. The Coutts Million Pound Report (2015) notes that “million dollar donations in 2013 were worth more than twice those of 2012” (p. 1), largely because of a single $1.39 billion donation from HNA Group to found a corporate foundation. The report also notes that the types of donations and financial instruments are becoming increasingly sophisticated, and that the share of the number of million dollar donations by corporations annually continues to increase. A study by Johnson and Saich (2017) noted that in 2016 the top 100 individual philanthropists in China donated $4.6 billion, a threefold increase from 2010. The article also noted a similar trend toward institutionalization, with 46 of the 200 highest net worth individuals in China reporting the establishment of family or corporate foundations; further, two-thirds indicated that they either had or would be establishing foundations. In addition, examples abound of innovations in technology and examples of crowd-sourcing experiments. The Harvard Kennedy School Ash Center for Democratic Governance and Innovation has been tracking a diversity of measures relating to high net worth philanthropy in its Annual “China Most Generous” study. Also, the fact that even a cursory search yields many such reports by financial services firms extolling the high hopes for high net worth philanthropy in China further illustrates the great expectations held for philanthropy.

Also, across studies (Johnson and Saich 2017; Ministry of Civil Affairs 2016; Yang 2014), both foundation activity and charitable giving converge around education, vocational readiness, health, and to a lesser degree, arts and culture. Johnson and Saich (2017) note that funding for environmental affairs is generally low, aside from episodic funding of natural disasters. While this convergence of focus is well-aligned with the priorities of the state, it also reveals a narrow focus that may inhibit the traditions of pluralism and the role of the philanthropic sector as vanguard, though there may be evidence of such through innovation and experimentation within these areas. Entrepreneurs may also bring a similar strategic lens to philanthropy that has shaped innovation in other commercial industries in China.

Central to these trends is the evolving nature of China’s regulatory environment for philanthropy. A recent study by Harvard’s Ash Center (2015) notes that in 2014 as a proportion of GDP, charitable giving in China was only 0.10%, in contrast to 2% in the USA. This report attributed some of this differential to the historically unclear tax and legal parameters, inadequate financial instruments, and problems of trust. Academic literature to date well documents legal challenges and ambiguity, ranging from the “mother-in-law” dual registration requirements for charitable organizations to essentially a vacuum with regard to laws on charitable giving. Indeed, there was a nearly twenty-year period starting with the establishment of the Registration and Management of Social Organizations Law, the Interim Regulations of the Registration and Management of Civil Non-Enterprise Institutions, and the Public Donations Welfare Law (1998 and 1999, respectively) and including the Regulation on the Management of Foundations (2004), during which an inadequate and contradictory set of laws did not keep pace with rapid social and economic development. After a more than 10-year period of development and discussion, including the commissioning of white papers by a number of academic centers devoted to the study of philanthropy in China and other leading Chinese scholars of philanthropy, China’s new Charity Law was passed in 2016. Though there is much to be determined in the implementation of the law, many analysts view the law as a watershed in that it eliminated the burden of the dual registration, established mechanisms for private foundations to raise funds from the public, and fostered transparency, among other things, codified in the law is an explicit set of mission areas exclusive of advocacy. There are provisions capping administrative spending in foundations at 10%, which may limit professionalization and capacity development, but serve normative drivers to direct charitable funds toward mission-related expenditures. An additional and promising development rests in pending amendments to the country’s Enterprise Income Tax Law (2017) around better incentivizing corporate donations. Primarily, these legal developments are viewed as vital steps in rationalizing the law and regulation of philanthropy, a hallmark of a maturing sector and one poised to grow but to grow in ways consistent with the desires of the state.

Although philanthropic activity appears to have grown over the past decade in China, global, comparative studies of philanthropy yield a relatively troubling picture of the state of philanthropy in China. For example, the 2015 Charity Aid Foundation Global Giving Index ranked China 144th out of 145 nations on a combined measure of giving that included giving to a stranger, donating time, and donating money. The 2018 Global Philanthropy Environment Index measures the incentives and barriers to donors and organizations around key factors of regulatory environmental conditions (regulations for formation, operation, and dissolution, tax incentives, and cross-border flow), the political environment (relationship between the state and philanthropic organizations), and sociocultural factors (philanthropic traditions, trust, and public awareness). Using data from 2014 to 2018 on 79 nations or economies grouped across 11 regions, the GPE Index uses a scale from 1 to 5, with one being lowest and five highest. China ranked in the second lowest grouping globally, with a score in the band of 2.5–2.99, this band being higher only than Belarus and Qatar. In the East Asian scoring, China ranked 2.77 in comparison with scores above 4 for the other four economies included in the study (Japan, Korea, Taiwan, and Hong Kong) (p. 55).

These trends reinforce the need for greater understanding of the enabling environment for philanthropy in China. Indeed, the comparative scholarship on philanthropy shows that the growth and functioning of philanthropy are conditioned on regulatory, tax, and fiscal policies (Anand and Hayling 2014; Duquette 2016; Moore and Rutzen 2011; Salamon and Toepler 2000). Anand & Hayling also suggest that sociocultural attitudes relate to the development of philanthropy, as measures of trust, corruption, and stability can affect how philanthropy is perceived and enacted over time. Additional scholarly work specific to East Asia further reinforces these broader comparative findings, particularly around inadequate legislation or ill-designed implementation of tax policies as barriers to the growth and development of philanthropy (Ye and Onyx 2015; Wang et al. 2011). Toepler (2018) cross-national comparison of foundations further reinforces these themes and amplifies the importance of the state as an enabling or inhibiting factor to the growth and development of foundations.

Thus, for all its promise, China’s philanthropic sector also has appeared to exhibit pathologies common to China’s overall political system: a heavy reliance on state initiative, inadequate transparency, corruption, insufficient regulatory support for charitable donations, and weak norms relating to conflict of interest and transparency. Hence, although the overall amount of philanthropic activity has grown dramatically, questions remain around governance, capacity, and professionalism constraints and performance. One worrying implication is that many social problems may go unaddressed or even be made worse by misdirected philanthropic activity. This historical moment is also a critical inflection point in the study of philanthropy in China, as the 2016 legislation that moderates domestic and foreign philanthropy is being newly implemented just as China’s social needs continue to expand.

Growth of the Scholarly Community and Scholarship

There has been notable growth in academia devoted to the study of philanthropy in China and the training of future scholars. Even as civil society scholarship has been dampened, at least four new institutes and centers on philanthropy have emerged, including the Institute for Philanthropy at Tsinghua University and the China Global Philanthropy Institute at Beijing Normal University. There have been several multilateral global philanthropy conferences and exchanges moderated by the East–West Center based in Honolulu, Hawaii. In addition to collaboration within China, the two major scholarly associations in the field of nonprofit studies, the Association for Research on Nonprofit Organizations and Voluntary Action and the International Society for Third Sector Research, have organized Asia interest groups and hosted meetings in China. Further, ARNOVA and academic partners at Renmin, Peking, and Tsinghua Universities have hosted three workshops for emerging scholars and Ph.D. students on scholarly publishing. Both Voluntas and NVSQ, two leading nonprofit journals, have a marked uptick in submissions and acceptances from Chinese scholars and scholars writing about China. These developments hold promise for a strengthened scholarly community focused on the study of Chinese philanthropy.

Although the problems in China’s philanthropic sector discussed above are broadly understood, a review of the literature and consultations with other experts reveal exciting, but as of yet only emergent scholarly research on philanthropy in China. This is a noted contrast to a sizeable theoretical and empirical literature on the relationship of the state and civil society. In addition, there have been numerous excellent overviews of the nonprofit sector in China which provide a good window into the challenges of NGOs (Hsu and Jiang 2015; Deng 2015; Hildebrandt 2011; Von Hippel and Pissler 2010; Hsu 2010; Shieh and Deng 2011; Simon 2009; Spires 2011; Unger 2008; Zheng and Fewsmith 2008). Jennifer Hsu (2014) provides a useful review of the literature on Chinese NGOs and civil society, but that review does not address philanthropy specifically. Moreover, the research in this area is imbalanced, with a great deal of attention on environmental NGOs (Chen 2010; Cooper 2006; Ho 2001; Morton 2005; Ru and Ortolano 2009; Schwartz 2004; Tang and Zhan 2008) and much less on other substantive areas, including education and health care. Moreover, service organizations represent only one side of the equation. NGOs must be funded and supported, and there has been much less research on charitable donations and other philanthropic activity of Chinese individuals and companies, either on their own or through their foundations (Estes 1998; Gao 2009; Lee 2009; Lin 2010; Song et al. 2012; Su and He 2010; Wang and Xu 2010). Much of the literature on Chinese philanthropy has been normative or descriptive, and not theoretically grounded (Huang et al. 2014). Alternately, there has been an international community of legal scholars writing on the legal framework for civil society (Simon 2009, 2010, 2011, 2013; Breen et al. 2016), which included themes closely relating to charitable giving and the regulation of foundations. Likewise, the 2016 special volume on China in Voluntas showcased important new work on Chinese nonprofits, civil society and citizenship; in this volume one sees the diversity of nonprofit activity, with notable areas of theoretical application and original empirical work.

In the realm of philanthropy, however, there has been limited published research by Chinese or Western scholars on foundation operations or on the relationship to the recipients of foundation support. This is starting to change as the China Ministry of Civil Affairs is making more data publically available. To date, however, we have only limited understanding of whom individuals and foundations support, why they provide support, and what are the consequences of their efforts. There is a much larger literature in Chinese by domestic Chinese scholars. Since 2000 there have been at least 800 scholarly articles on the philanthropic sector. Much has appeared since 2009, which can be tracked to interest in philanthropy generated by the activism, voluntarism and giving coordinated by NGOs in responding to the May 2008 Sichuan earthquake. Despite the large amount of work and greater descriptive understanding we have of a variety of issues, scholarship overall has remained somewhat weak. The extant publications are largely descriptive and typically make no broader arguments rooted in data collected as part of their research (Guo 2012). The case studies are usually very brief and not strategically chosen to test hypotheses; the discussion is often not based on first-hand primary research. There are some quantitative studies, but most are a general listing of facts and do not involve econometric analysis of hypotheses that would allow one to test explanations for the trends we see. In addition, the use of extant organizational, political or economic theory is relatively scant. Theory building, which would be particularly useful in the context of China’s emergent third sector institutional environment and resultant experiments in philanthropy, is slim. As a result, there is no consensus about a research agenda for the field that would build a more comprehensive understanding and raise follow-on questions. The limited cohesion of scholarly research, in turn, makes effectively addressing the problems of the sector much more difficult.

Scope and Aims of the Special Volume

This special volume seeks to contribute to the literature on philanthropy generally and on understanding of philanthropy and the philanthropic sector in China specifically through a cohesive approach based on original theoretically driven, new empirical work. The special volume emanates from scholarship produced from the five-year “Initiative on Philanthropy in China” (2013–2017). The Initiative was led by the Guest Editors and undertaken in collaboration with the Indiana University Lilly School of Philanthropy (where Angela Bies was a faculty member and Director of International Programs), Indiana University’s Research Center for China Politics and Business (where Scott Kennedy was Director), the Center for Strategic and International Studies, and the University of Maryland, with funding from the Ford Foundation and Henry Luce Foundation.

The Initiative on Philanthropy in China combined in-depth, original, theory-driven empirical research by a community of scholars from the USA and China with a series of workshops and conferences to develop and refine scholarship and disseminate findings to a larger body of scholars, practitioners and policymakers within and external to China. Scholars who participated in the Initiative are comparative, international scholars, well known in the areas of philanthropic studies and China studies, but also highly pluralistic in terms of methodological approaches and disciplinary backgrounds. Through our collaboration, we improved our individual work, furthered measurement, and brought new lenses to bear on the role of the state and the art of philanthropy.

The Contributions and Their Collective Contribution

The papers in this special volume focus on both the environment that affects philanthropy and the behaviors of philanthropic actors that adapt to or seek to shape that environment. The authors explore new empirical developments in China’s philanthropic landscape that simultaneously speak to and enrich theoretical inquiry, cross-national comparisons, and the policy debate.

The Studies and Their Findings

Two of the papers in this special volume address substantive areas of philanthropy, health philanthropy and philanthropy and grassroots NGOs, two under-researched areas one central to the state’s social priorities and the other potentially more contested. A third paper considers donative revenue, and the need for diversification in grassroots organizations, organizations arguably most at odds with state funding priorities and enabling mechanisms. A fourth paper examines community foundations, a growing institution and one well poised for greater growth in China’s foundation landscape but one not well studied. The final two papers are particularly timely; one provides a first examination of Chinese philanthropy overseas while the other examines the 2016 legislation designed to control foreign contributions to Chinese philanthropy, the legislation’s motives, its development, and its early implementation. These papers combined help us understand how Chinese’s first stage of philanthropic maturation has taken shape and create a roadmap for future research.

Shawn Shieh focuses our attention on the paradox of the significant growth of wealth and institutional philanthropy in China not giving way to increased domestic funding for NGOs. Shouldn’t foundations and NGOs be natural allies? Shieh, on the face of it, begs the question, but his stance is not simply normative but rather a systematic empirical exploration of why these two sector neighbors are so different in their views and approaches and whether progress is being made to bring them closer together, to borrow Shieh’s metaphor, to move from “same bed, different dreams” to “same bed, same dreams.” Shieh first lays out the diversity of legal and organizational structures of Chinese NGOs, operating versus grantmaking tendencies of and the dichotomy around the right to raise or not raise public funds by Chinese foundations, effectively placing the Chinese concepts and forms in comparative context. Using apt case examples, Shieh takes us on an evocative walk on the divergent pathways by which grassroots NGOs and foundations have developed, pathways punctuated by party-state mimetic processes influencing the development of Chinese public-fundraising foundations and government-organized NGOs (so-called GONGOs), learning from foreign NGOs shaping grassroots NGOs, and foundations that lack the legal right to engage in public fundraising being shaped by both.

In tracing these pathways, Shieh also grounds his analysis in ameliorative factors, such as formal efforts by sector-wide actors to promote foundation and NGO collaboration, to illustrate that these paths are not necessarily deterministic. Though Shieh situates his study in China as a unique case, his work has implications for foundation and NGO relationships more broadly, a relationship that to date had been under-theorized and under-researched. Shieh’s conclusions and methodical approach provide a map for ongoing research in other national settings, NGOs and foundations working in other subfields and substantive policy areas, and in settings with shifting structural and cultural environments.

Chao Guo and Weijun Lai provide a textured assessment of the current state of China’s community foundations. They first identify two drivers of philanthropy that shaped the genesis of community foundation development in China: the decline of public trust in government-affiliated nonprofits and local experimentation with new structures for organized philanthropy. After grounding the paper in the comparative literature on the century-long community foundation movement globally, Guo and Lai identify some of the first natural experiments at community foundation establishment in China including: a corporate foundation with a community-minded mission; the noteworthy One Foundation, where superstar power leveraged widespread citizen compassion into the first legally recognized foundation independent from government with the right to raise funds from the general public; and the Guangdong Harmony Foundation, the earliest and most consistent with the conception of a community foundation, of independent auspices and organized around a particular community. From this, the authors provide a typology of community foundations, conditioned on affiliation with or independence from government and holding the right to raise public funds, dimensions essential to understanding this philanthropic form in China. This builds the backdrop for a careful mixed method approach, joining a national survey with deep case study. The result is a paper that provides a thorough first analytic snapshot of the genesis and early evolution of China’s community foundation movement, further explication of key resources, governance, community conceptions shaping the community foundation form in China, and the architecture for future scholarship.

Yanzhong Huang’s study delves into one of the most important substantive areas of philanthropic and NGO activity, healthcare. This is a needed study as most scholarly attention has been devoted to other key substantive areas of the third sector closely aligned with the aims of the Chinese state, namely education, the environment, and disaster relief. Using a state-society relations approach, Huang sets out to examine the dynamics between the state and the health philanthropy sector. Contrasting the conventional “bottom-up” approach used by civil society scholars that privileges the role of social actors and downplays state power, he draws instead on a “state-society synergies” frame that considers areas of mutuality as a more appropriate lens for nondemocratic contexts such as China. Specifically, Huang uses Teets’ (2014) concept of “consultative authoritarianism,” which explicitly acknowledges the coexistence of civil society’s expanded ‘‘operational autonomy’’ and enhanced state capacity and control over the society in China. The conventional lens would predict a decreasing state role as third sector and other privatization increased; the consultative authoritarianism lens would predict a strong state role and an expanded role for philanthropy in healthcare. Thus emerges Huang’s central question: Has a rising philanthropic sector led to a smaller state role in China’s health philanthropy? Using a mixed method approach, Huang combines a deep historical analysis supplemented with interviews with key policy and practice actors in the health policy space, and an in-depth case study of the influence of the Gates Foundation Global Fund. This processing tracing approach helps tease out the key mechanisms that led to differential scope and role by state and philanthropic actors.

Huang grounds the study in the history of the imperial era where a range of private religious, charitable and state actors played a hand in public health provisions to the founding of the People’s Republic of China in 1949, at which point Huang notes the state dominates all public health activity. Huang then identifies the antecedents of greater access and affordability needs as driving healthcare reform in the Post-Mao era. This gave rise to greater public–private partnership, especially in the area of disease eradication, but also had the unintended consequence of uneven and unpurposeful philanthropic involvement in healthcare, resulting in a return to greater state dominance in the healthcare space, the opposite of what “consultative authoritarianism” predicts. Huang ends with a set of questions regarding the role of the state, given that continued pressures for affordability and access are not abating.

Jiangang Zhu, Shihua Ye and Yifei Liu ask what drives revenue diversification in Chinese grassroot NGOs. They expand on themes explored by Shieh around pathways that have shaped the resource environments of grassroots NGOs and paint a picture of a fairly vibrant and increasingly dynamic marketplace for donative and other investment into contemporary grassroots organizations. The authors also contribute significantly to our understanding of resource diversification, and its analog resource dependence, by focusing not on how diversification affects or predicts organizational outcomes, but rather what affects revenue diversification. Using original data from a national sample of grassroots NGOs, the authors present a rare empirical lens into this question and contribute significantly to theory development in nonprofit studies. Some of their findings may be “China-specific.” For example, contrary to what is predicted (in part based on studies from other countries), revenue competitiveness did not predict revenue diversification, a finding the authors interpret as a lack of experience with a diversity of resources and a more narrow focus on proximal sources of funding. Similarly, registration status, which is historically challenging for grassroots organizations to achieve in China, is associated with revenue diversification.

The paper also holds implications for the development of grassroots organizations and their resource stability, as Zhu and colleagues identified the importance of governing boards and accountability to multiple stakeholders as drivers of resource diversification. This is consistent with the representational nature of grassroots organizations and may suggest that collective considerations and attention to organizational capacity and professionalization hold promise for strengthening grassroots NGOs, a view particularly important as the legal and institutional environment for domestic and foreign revenue continues to evolve.

Mark Sidel provides a comprehensive review of the famed 2016 Foreign NGO Law. Formally titled “Law on the Management of the Domestic Activities of Foreign Non -governmental Organizations in China,” this legislation seeks to regulate foreign foundations and nonprofit organizations operating or funding activities in China. Sidel first traces the history of regulation of foreign contributions, foundations and nonprofits, describing the general regulatory tendency in the Reform Era (since 1978) toward foreign NGOs and foreign donors as generally oriented toward expansion and operating relatively well without being wholly “securitized.” This has been a fragmented system spanning multiple government agencies, where registration was not easy but also not impossible, and whereby the Chinese state could and did keep close watch over some foreign groups and donors and also allowed operations by those with interests consistent or beneficial to the state. Sidel explains that the recent regulatory changes toward foreign NGOs and donors represent a larger closing of civic space, in which China practices “differentiated management” toward the various parts of the nonprofit and philanthropic sector. State oversight is intentional, sophisticated and differentiated for domestic NGOs with activities aligned with and not threatening to state interests, domestic advocacy or civil society organizations, and foreign nonprofit and philanthropic organizations. In evocative details gleaned over first-hand access and through elite interviews, Sidel discusses the drivers of the tightening of civic space for foreign and certain domestic actors, and the drafting, public comment period, and uncertain implementation of the law. The paper concludes with a comparative contextualization, with a particular critique grounded in similar legislative initiatives in other countries. Sidel’s work will provide an important backdrop for future scholars to study the implementation and effects of this legislation and increasingly similar legislation in other national settings in Asia and beyond.

Guosheng Deng provides the first comprehensive documentation of Chinese involvement in overseas philanthropy, and an interesting juxtaposition to some of the themes that Sidel addresses. After documenting the number of foundations and the type and size of donations, he asks a reasonable question: Why do Chinese foundations engage in overseas philanthropy, and what determines whether they are more or less likely to be effective? The answer turns out to be not so simple, but highly instructive as a window into China’s philanthropic sector.

Deng traces the evolution of the Chinese state’s outward engagement in development and foreign aid and finds that, like other nations, involvement of one’s NGOs has some advantages over direct government spending in targeted countries. Deng draws on a sample of the 500 largest foundations in China, and supplements this original survey with interviews and documentary analyses. He first documents a rapid rise in terms of foreign financial activity by Chinese foundations in the recent decade, but also reports the paradox that though the majority of foundations indicated that overseas funding was necessary, an equal number felt they were not mature enough to engage overseas. So, while the trend is toward greater activity, there is still a great deal of hesitancy. Using both interviews and quantitative analysis, Deng examines the various factors that shape why Chinese foundations go abroad and their level of engagement, including policy constraints, prior cultural exchange, fundraising potential, internal staff capacity and motivations of private entrepreneurs and state engagement globally. In a two-stage model, Deng then tests the factors that drive overseas engagement and the extent of that engagement and finds that prior cultural exchange and engagement with foreign NGOs was the single biggest predictor of both, with staff capacity also significant pointing to the importance of professionalization. The foundation’s size, measured by assets and annual revenue, is not predictive of either. The implication is that cultural exchange and professionalization matter. Given recent regulatory changes, these are two areas that may be constrained. On the other hand, there is great alignment with state policy that increasingly engages in substantial foreign economic development and the motivations of private enterprises, as well as motivation on the part of the majority of surveyed foundations, so the future of externally oriented Chinese philanthropy remains unclear.

Further Evidence About the State’s Role

Our own research, also carried out under the auspices of the original Initiative on Philanthropy in China, reinforces the findings of our initiative contributors, showing that the political environment has not squashed philanthropy, but instead, in combination with other factors has fundamentally shaped it along several fronts. The first is how China’s political context shapes the external behavior of philanthropists, for example, in what motivates philanthropy, their choice of activities and types of social challenges they address. The second is with the internal capacity, operations, and professionalization of philanthropic organizations themselves. The state’s indelible fingerprints are visible in both spheres.

Corporate Philanthropic Activity

The large majority—65%—of philanthropic donations in China occur via companies (Zhou 2018). This contrasts sharply with the USA, where individual giving constitutes the bulk of donations and other kinds of support and is largely unusual in a broader comparative perspective. Understanding the motivations behind corporate giving, thus, is central to understanding China’s broader philanthropic sector. Previous research has found that Chinese companies engage in philanthropy to demonstrate their loyalty to political patrons or more generally serve the state’s priorities (Li et al. 2015). Although insightful, a more balanced approach would be to consider the potential effect of politics alongside two other kinds of motivations, altruism and business success. Only a full-blown skeptic would not allow for the possibility that philanthropy was not undertaken at least in part with an altruistic motive of doing good. And conversely, as much as Chinese executives want to please their political patrons, they may also see philanthropy as a marketing device to promote their brand and increase sales.

To address these questions, we draw on a formal survey of over 700 companies carried out in 2014 by the Horizon Key Information and Data Co., Ltd. The survey, whose data were purchased by the authors, used a two-stage quota sampling process to ensure there was an adequate representation of firms of different ownership forms, sizes, sectors, and regions. The respondents were either the top executives of the company or the person responsible for managing their philanthropic activity. The study asked respondents a series of questions to gauge their potential motivations to engage in philanthropy as well as their actual philanthropic activity and corporate social responsibility practices, both in China and abroad. Additional information was obtained about their industry, location, sales, ownership format, and other characteristics. China is a challenging country in which to do formal surveys largely because the environment generates pressure for respondents to give politically correct answers even when anonymity is assured. That said, there is now a wealth of studies on political attitudes and behavior that meet the most rigorous social science standards (Dickson 2016). In our context, these pressures obviate toward answers that reinforce the goal of altruism. So findings that point in a different direction should be seen as highly revealing.

The full results of the survey, including with extensive quantitative analysis, are being published separately, but the core findings can be summarized here.

A range of questions were asked to determine firms’ motives for why they engage in philanthropy. As Table 1 shows, companies in China tended to emphasize altruistic reasons for giving. For example, 73% said a main goal for giving is to “uphold the values of the firm,” and over 58% said an important goal was “to solve a social problem.” That said, a sizeable portion of respondents admitted that political factors shaped their philanthropy. Over 19% said a key goal was to improve their relationship with the government, and 27% said this was a secondary goal. Similar numbers said philanthropy was directed toward helping the government achieve its policy goals. A smaller proportion of firms said their goal was to improve their companies’ business opportunities. A few did say they wanted to use philanthropy to improve relations with their customers, help with market entry and diversity risks, but business was not as salient as the other two factors. Answers to open-ended questions reinforced the impression that altruism was the primary motivation but that politics were a real consideration, in contrast to promoting business opportunities being of less relevance.

Table 1 What motivates companies in China to engage in philanthropy?
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Because data were collected on firms’ actual philanthropic behavior, including donations, volunteering and corporate social responsibility programs, the survey also provides insights into how motivations affect actual philanthropic behavior. We used the donation data as the independent variable and created an index of the three kinds of motivations by combining answers to three questions in each category to ensure the results were not biased by an answer to any single question. The results showed a clear pattern: firms that emphasize altruistic and political goals donate more than firms that emphasize business goals. Although firms more often admitted to altruistic goals, when regressed against their actual behavior, the relative effect of altruistic and political goals was almost identically powerful, while firms that emphasized business goals were no more likely than those who did not to donate more.

Finally, companies of different ownership forms have different kinds of motivations, and their philanthropic activity also differs. Chinese state-owned enterprises (SOEs) are more driven by political motivations than private and foreign companies. That said, the amount of their donations, when firm size and industry are held constant, is lower than that of their private and foreign cousins. Moreover, SOEs are more likely to donate to issues that are more politically salient. For example, SOEs more often donate right after natural disasters than to other causes that receive less heightened official attention, for example, for education.

The bottom line of the survey is consistent with what our colleagues found in examining other areas of philanthropic life in China: politics matters. To some extent, this finding is accentuated because of the prevalence of SOEs. They still occupy the commanding heights of strategic sectors, and they are likely to remain prominent players in the economy and philanthropy for some time to come. But even if SOEs become less economically prominent and cede more ground to the private sector, the data show that China’s political institutions and norms will still shape the trajectory of corporate philanthropy.

The Capacity of Philanthropic Actors

Philanthropic organizations in China exist in a challenging institutional and regulatory environment with an increasing role in the provision of public goods and services, yet their capacity is often insufficient (Tuan 2012). This complexity is exacerbated by the Chinese state’s inconsistent regulatory hand, which signals a dual message of expectation and apprehension. As is the case with philanthropic organizations in many parts of the world, these tensions further rise and fall on the waves of public accountability scandals and are buttressed by regulatory and self-regulatory antidotes.

In the lead up to the adoption of the comprehensive charity legislation in 2016, the Ministry of Civil Affairs initiated a diversity of measures to enhance oversight and public accountability, experimented with policies relating to receiving and using donations, increasing the ceiling on allowable accumulated assets, expanding auditing requirements, and fostering greater public disclosure of information (Ministry of Civil Affairs 2012a, b). Further, self-regulation was emphasized with some attention paid to governance, including the development of industry standards for “good governance” and the development of a voluntary Transparency Index by the China Foundation Center (CFC), a private organization founded to help professionalize and build trust in the in philanthropic actors. Outcomes of this were greater data requirements by the Ministry of Civil Affairs and provision of data on foundations to the general public by CFC.

We were the first group of researchers allowed to purchase and publish on data from the China Foundation Center, though CFC does make some data reports widely available to anyone as part of its transparency mission. To date, most research on foundations in China had examined foundations in total rather than comparing difference across various types of foundations. We were particularly interested in whether corporate foundations differed from other types of foundations and what role proximity to the state played in foundation behavior. In addition, foundations had been the primary organizational type in China allowed to solicit charitable donations from the public; even then few foundations were allowed to fundraise from the general public, with most foundations being bound by very proximal requirements for sources of funds emanating from the foundations’ founders and auspices. Also, foundations typically operated in the narrow band of mission areas consistent with the state’s priorities (and within bounds of substantive areas not deemed politically sensitive); to manage risk, many foundations did not engage in grantmaking but rather carried out their work as operating foundations (Simon 2011).

To explore these questions, in 2014, we worked with CFC to draw a stratified, random sample of 601 foundations by foundation type (i.e., corporate, university, family, independent, community, and government-related foundations). CFC provided us with their full complement of data for the prior fiscal year, including basic demographic and financial data (largely obtained from the Ministry of Civil Affairs through the foundations’ annual reports to the ministry), basic board governance, somewhat extensive accountability data (derived de novo through field surveys carried out by CFC), and complex, raw narrative data on board membership and composition, foundation service area and projects, and project beneficiaries. Our team of researchers spent twelve months, including 4 months in the field, cleaning, translating, collecting missing data directly from the foundations, and coding complex narrative data from the foundations’ annual reports. In addition, we hosted focus groups with a small, purposeful sample of foundation executive staff from known grantmaking and operational foundations derived from our larger foundation sample. We queried the respondents on motivations for establishment and mission activities; rationale for grantmaking, operational or hybrid approach; board governance and independence; the relationship with government or any other “parent” entity; perspectives on regulation; and views on the role of organizational capacity development.

Similar to our work on corporate philanthropy, the full results of this line of our mixed methods inquiry, including multivariate analysis and case examples from focus group research, are being published separately. A summary of the findings follows here.

In Table 2, summary statistics on variables of interest are provided on all foundations in our sample; Table 3 lists the results by foundation type.

Table 2 Foundation characteristics
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Table 3 How do foundations vary by type?
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In terms of accountability, the sample mean value of the transparency index (constructed with weights for transparency behaviors and scored from 1 to 129.4) is 69.983. University, independent, and government-related foundations have a higher transparency score than corporate, family, and community foundations on average. In addition, the transparency score of the former three types is above 70, while the scores of the latter three types are below 70. Ironically, government-related foundations are most transparent, while family foundations are the least transparent. In terms of mission diversity, as expected, foundations have a narrow focus with an average value of 2.16. Although there are variances in the mean values of mission diversity across foundation types, all mean values except community foundation approximate 2.

The results indicate a relatively low level of professionalism in China, as the mean value of the total paid staff number is the sample is 4.31. Differences exist across foundation types with government-related (M  = 7.66, SD = 8.49) and university (M  = 5.6, SD = 10.80) being more professionalized. Our interviews reveal that some staff members may be paid by the parent corporate entity in the case of corporate foundations. As the 2016 charity legislation has a cap on administrative spending, recruitment and retention of paid staff may continue to be challenging, particularly for those foundations that are most independent from a larger parent entity such as government, a state-owned or private enterprise, or even, a university foundation, where alumni relations and fundraising are becoming more typical forms of staffing.

In terms of governance, the mean value of the ratio of paid board members to total board members is 0.05, indicating relatively high independence of board members. Family and government foundations have a slightly higher ratio than other types of foundations for the first two have mean values of 0.09 and 0.10, respectively, and other types of foundations have mean values below or equal to 0.05. In terms of size, the mean value of the total income of our sample foundations is RMB 18.93 million, with community foundations earning the largest average income of 37.79 million and independent foundations the lowest, at 10.51 million. In general, revenue sources are highly concentrated across all foundation types. Foundations have, on average, only two revenue sources.

Government-related foundations are older, largely because it was challenging to form a foundation prior to the creation of the enabling law for private foundations in 2004. In addition, government-related foundations can generally raise money from the public, while other types of foundations face more restrictions on public fundraising. In general, we found that foundations with a longer history, more full-time staff, larger expenditure, diverse mission areas and revenue sources tend to have a higher transparency score. There are competing explanations for this. On the face of it, transparency comes with some costs, costs that might be prohibitive for smaller organizations. Likewise, foundations that raise money from the public might use transparency as a mechanism to build trust or in response to donor expectations. Our qualitative interviews suggest a third explanation, and one somewhat unique to the Chinese context: the cover of proximity to government reduces perceived risk for sharing information. Mission delivery is not controversial in these foundations and they have some measure of professional staffing, which serves as a signal for quality. In other words, they are perceived as and portray themselves as more government than nongovernmental and this is a signal for trustworthiness, so telling the organizational story bears less risk. These foundations also typically have board members well connected to the state, which is also ameliorated risk. Our multivariate analysis similarly shows an association with government-related foundations and higher levels of transparency.

Our interviews with foundation executives provide more nuance regarding mission-related activities. Largely, but particularly for corporate foundations, the mission area emanated from its auspices. From a historical perspective, respondents noted that the earlier Chinese foundations were established to mainly advance government’s public service agenda and that this orientation, along with pressure from the state, results in a charitable, nonpolitical orientation to the work of foundations. In the case of corporate foundations, however, several indicated that when the establishment of private foundations was allowed in 2004, there was also an opportunity to consider the relative strengths of the corporation, as well as its business interests, which provided a window of opportunity to move beyond the narrow band of mission areas undertaken by government-affiliated foundations. One expressed this in terms of innovation, not necessarily branching out in new mission areas but doing things in new ways because of corporate expertise. Several respondents indicated that they identified unmet needs and sought to cover new ground in their work. Respondents expressed professionalization in terms of their own organizational capacity, as in areas of human resource and financial management, but also in terms of their substantive interests and related expertise.

Nearly all respondents described working as an operating foundation as a mechanism to manage risk: first, by creating and managing their own projects they reduce transaction costs, rely on their expertise, and maintain control; secondly (prior to the 2016 legislation), it was challenging to establish a foundation or other nonprofit-type entity, thereby limiting the supply of capable potential grantees or partners; and three, keeping projects “close to home” also provided political cover if problems arose. On this last point, providing cover suggested several meanings, the foundation could be humble, could enjoy a salutary effect from the mission on the larger organization, and could both experiment and limit risk at its own discretion.

In this way, the organizations, especially when they do not rely on a large range of external funders may operate more like private organizations, yet private organizations highly cognizant of the expectations of the state. This will be something to measure in the years ahead, as the state continues to maintain strong oversight and constraints on the range of missions allowed while also enabling establishment and seeking growth in these sanctioned sectors of activity.

Conclusions and Implications

Common Insights

The studies that compose this special issue, supplemented by our own research, break new ground in understanding trends in Chinese philanthropy. They are methodologically diverse, employing rich case studies, textual analysis, focus groups and formal surveys. Together they uncover developments in under-explored areas, including on specific areas, such as healthcare, new regulation, and the emergence of Chinese philanthropy abroad. Equally important, they analyze the relationship between different actors, from service organizations, the range of domestic foundations, international philanthropic organizations, and regulators. Moreover, the studies analyze how the broader environment affects the actual performance of philanthropic actors.

Although covering different issues and topics, the broader empirical and theoretical conclusions are largely reinforcing. They collectively demonstrated that a wide range of factors—economic, organizational, cultural, social, political—shape the nature and trajectory of philanthropy in China. Yet a key theme of the contributions in this collective endeavor is the disproportionate importance of the Chinese state in shaping the country’s philanthropic sector, both through intentional policies and as a product of the political system’s institutions and operating norms. The uneasy relationship between NGOs and foundations found by Shieh, the need for community foundations and healthcare NGOs to work collaboratively with government agencies described by, respectively, Chao & Lai and Huang, the tight restrictions affecting foreign nonprofit organizations’ activities in China explained by Sidel, Chinese foundations’ habit of keeping in mind China’s foreign policy priorities when engaging in philanthropy abroad documented by Deng, and the dynamics of corporate philanthropic activity described in our research all reflect the power of politics. This basic conclusion is not unique to the study of philanthropy in China but is equally visible in every facet of Chinese social life, including the media, religion, education, and the economy.

The Broader Relevance for Philanthropic Studies

This conclusion, as noted above, is also not unique to the broader philanthropic studies community. That said, the inclusion of research from China helps elucidate previous analysis. As others have shown, we see that the state enables, restricts and shapes the philanthropic sector. The Chinese case highlights the importance of regime type—authoritarianism versus democracy—as China’s philanthropic sector are either limited or encouraged as a result of the Chinese state’s inherent preference to exert control over society and social organizations. Yet China also shows how regime type alone is insufficient to fully explain the dynamics of philanthropy in any one polity. China’s large and complex bureaucracy provides the organizational framework and incentive structure that yields the growth of philanthropy in some areas and limits it in others. Countries with either smaller bureaucracies or more fragmented states are likely to witness a very different pattern of philanthropic development. Beyond these “constitutional” factors, the state’s evolving policies also matter immensely. Framing regulations for civil society and philanthropy, economic development priorities, and the approach toward globalization and level of openness toward foreign actors all have shaped the direction of philanthropy in China and other countries. Hence, this is why observers see variation across the landscape, a conclusion one could not reach by only considering a country’s formal political system.

The studies that compose this special issue also raise questions about how to situate China in comparative perspective. The country no longer neatly fits into a simple state socialist or post-Communist lens. Relatedly, large-scale, cross-national indices of philanthropy place China near the bottom. Our research collectively provides supporting empirical evidence, yet it also uncovers a depth and breadth of activity that is not captured in such figures. Even as some activities, such as advocacy, are highly constrained, others have grown quickly as a result of symbiotic collaboration by the state, the corporate sector, and nonprofit organizations. Despite state constraints, or perhaps because of them, there is a surprising level of entrepreneurial activity and dynamism in this space.

Suggested Future Research

Looking ahead, emerging forms of philanthropy in China need to be explored. For example, in 2014, one of China’s most successful business executives, Jack Ma of Alibaba, founded the first philanthropic trust in China. Since then at least another 80 have formed. These may be ways to hide one’s wealth from the tax authorities, but these trusts are meant to also be philanthropic outlets. There is yet almost no research on how they operate. Similarly, though individual donations remain small, the use of social media platforms to raise funds and to “chat” en masse about philanthropy provides potential and raises new accountability stakes and participation implications.

Our scholarship also points to the value and need to continue to look for systematic variation regionally, across China and between China and other polities, with more direct comparative analysis across locations and substantive mission areas, including via strategically selected case studies. For example, it would be useful to analyze the philanthropic activity of Chinese companies across multiple locale from in the city where their headquarters is located to the other domestic locations of their subsidiaries or other business partnerships, and operations outside China. Equally helpful would be small-scale or large-scale cross-national comparison involving firms from China and other countries and regions, such as India and Japan. The same could be done with parallel groups of service organizations and foundations, or of a global philanthropic organization that operates in multiple countries. This would allow us to more directly gauge the relevance of regime type, the specific regulatory environment, and levels of economic development on philanthropic behavior.

Our initiative did not principally address issues of management and internal operations, yet issues of critical importance including capacity, overhead spending constraints, board autonomy, and other professionalization aspects emerged, including differentiated regulation and some easing of the burden at the point of establishment. This is the time for careful organizational process tracing and event analysis to understand the interactions between the regulatory implementation and institutionalization of philanthropic organizational life. There is rich, extant theory on why and how philanthropic organizations develop and change over time in response to their environments, across a number of disciplines. It is urgent to consider extant theory, its adequacy in the Chinese context, its undergirding assumptions about power and self-determination, and anyways that new measures and theories must emerge.

Finally, one of the most important emerging areas of research will be the growth of Chinese philanthropy abroad. Evidence from the studies by Deng and Huang shows that China is just getting started. As Chinese investment continues to grow, including as part of the Belt & Road Initiative, and the Chinese state tries to provide more international public goods, observers can expect philanthropic activity to grow as well. A key area of focus will be the intersection between Chinese initiatives, the social and political contexts of target communities, and the international philanthropic community. Just as China is trying to influence the norms and behavior related to the Internet and information, trade, investment, finance, and infrastructure, it may also have a large effect on the direction of philanthropy globally. If so, it would challenge, for better or worse, the liberal international order built and influenced primarily by the USA and Western Europe.

One growing problem, though, with all of these proposals is the rising difficulty of doing empirical research in China. The constraints that are being place on philanthropy also affect the physical work of scholars, as it is increasingly difficult to carry out the interviews needed for case studies and process tracing the development of regulations, not to mention the near impossibility to carry out large-scale, formal surveys on sensitive topics. This applies both to domestic Chinese scholars as well as international experts deeply interested in China. We need to develop a full range of methods, including those that can be carried out from beyond China or in partnership with in-country scholars and organizations. This volume and the mission of Voluntas more broadly reinforce this commitment to engagement in our broad community of scholars.