The Impactful Philanthropy Institute under the China Philanthropist Magazine released its Impactful Philanthropy White Paper 2022 on Feb 28.
As the first annual research report published by the institute, the paper analyses the practices of 34 influential Chinese philanthropists and provides a panoramic view of the philanthropic impact of private entrepreneurs.
The White Paper argues that philanthropy’s aspiration and goal is to solve social issues and make a social impact. In this sense, the impact is the long-term result of philanthropic activities, creating large-scale long-term positive solutions for social problems.
Practices of sampled philanthropists
From 2011 to 2021, the total amount of donations including cash, items, and equity given by the 34 philanthropists exceeded 240 billion yuan ($35 billion), which constitutes nearly 20 percent of the total amount of donations during the same period.
The practices of the 34 philanthropists cover 44 segments, among which, more attention and donations have gone into four fields, namely poverty alleviation, emergency and disaster relief, education, and healthcare.
Besides, there is also an upward trajectory for donations supporting scientific development as well as art and culture. However, in comparison, environmental protection and senior care haven’t received the attention they deserve.
Twenty-seven of these philanthropists have set up their own foundations, three have set up domestic charitable trusts, and seven have set up overseas charities, with only a few not having initiated the establishment of charitable organizations. This shows their philanthropic practices have a relatively high level of organization and specialization.
Equity donations are becoming a more and more popular approach to philanthropy for the sampled philanthropists. There are already 11 philanthropists among the 34 that have completed 12 equity donations, with a value of more than 150 billion yuan.
However, very few of the charitable organizations founded by the sampled philanthropists have developed highly standardized and professional strategic planning or gained access to external professional support in their operations.
Approaches toward impactful philanthropy
The White Paper regards philanthropy as an investment in social value and proposes that the realization of philanthropic impact depends on the joint action and cyclical cycle of four components: philanthropic resource mobilization, philanthropic resource investment, philanthropic activity execution management, and philanthropic strategy exits.
In terms of approaches to achieving a bigger impact, the White Paper analyzed the case of a well-known Chinese philanthropist, Cao Dewang, and concluded with four lessons for philanthropists and organizations that aim to create substantial and lasting impacts.
The first is to remember that accumulating small good deeds can make a big difference, and philanthropic impact is also an accumulation process. Secondly, philanthropists should make a distinction between personal and corporate giving and help businesses and philanthropy grow together.
Thirdly, philanthropy is like a business that requires not only the investment of capital but also energy and wisdom. Lastly, to achieve sustainable impact, philanthropists and organizations should have systemized donation planning.
Donor-centric support system
To accelerate the philanthropy sector’s march towards impactful philanthropy, the White Paper advocates the gradual separation of individual giving from corporate giving and calls for a philanthropy model based on individuals’ value systems.
Therefore, different entities in the sector should work together to build a system with the necessary legal, policy, service, and technical support that is donor-centric to encourage philanthropists to further participate in and contribute to the development of philanthropy.