Quote of Today (March 31)

In every consultant, there are bits of being a problem solver, a reporter and a process manager. The way these attributes manifest depends on the person. Most consultants believe they are problem solvers. In reality, lots are more inclined towards the latter two attributes.

China and the Power of Tech-Enabled Philanthropy

By Edward Tse | February 2019

Dr. Edward Tse’s article on China’s philanthropy was published in the augural issue of Social Investor, commissioned by the Chandler Foundation.

From e-commerce platforms and Internet mobility service providers to AI and blockchain developers, Chinese technologies companies are transforming China’s economy and changing entire industries – including philanthropy.

China has a long tradition of giving, although it stagnated for roughly three decades when wealth was nationalized under the rule of Mao Zedong. Today, China is home to more billionaires – 819 in terms of US dollars – than anywhere else in the world, outnumbering the US and topping the Hurun Global Rich List 2018. And China’s super-rich are increasingly engaging in philanthropic causes.

According to Harvard University and UBS, between 2010 and 2016, donations from the top 100 philanthropists in mainland China more than tripled to US$ 4.6bn, and 46 of the wealthiest 200 Chinese billionaires now have charity foundations. Giving is much more common among ordinary citizens as well. It was reported that early in 2016, more than 20% of the total charity in China came from individual donors, a number that has grown steadily over the years.

Corruption and Transparency Woes Impede Progress

Despite those growing numbers, the philanthropic industry has been plagued by corruption and a lack of transparency. These are especially prevalent with non-profit organizations that claim to be government-supported.

In 2011, for example, a woman named Guo Meimei received a substantive amount of money from an official at the Red Cross Society of China, then flaunted her luxurious lifestyle on social media. In 2012, to cite just one other example, the China Charities Aid Foundation was accused of money laundering and embezzling.

For private philanthropists, a number of institutional and social barriers make it difficult for them to build, promote, and sustain charitable organizations. Policies mandating high expenditure rates and low administrative costs are two such barriers. Private foundations are required to spend a minimum of 8% of their previous year’s assets, making it almost impossible to grow an endowment. As a result, philanthropy remains a largely monopolized, state-run sector, and donations are largely limited to a few causes: education, poverty alleviation, and healthcare.

 

Technology – the Great Gamechanger

However, new technologies have helped bring innovative approaches to philanthropy and encouraged broader participation.

Tech giants, in particular, have already learned to take advantage of their branded merchandises to involve the general public in philanthropic activities. For example, in response to the 2008 Wenchuan earthquake in Sichuan, Tencent, the company behind China’s biggest social network as well as the largest gaming company in the world, established an online donation platform. More than half a million people contributed, raising a total of US$ 2.9m. Tencent added donation options to WeChat, the instant messaging and social media app with one billion monthly active users, and allowed users to give any amount with a swipe of a finger, making philanthropic engagement easier than ever.

New technologies have created more diversified ways of giving. The rising popularity of fitness apps in China has inspired tech companies to incentivize giving among the younger, more health-conscious, generation. Through the Xingshan (“doing good”) app developed by the Beijing-based company iMore, users record the number of steps they take each day, which is then “donated” to charities through corporate sponsors. By the end of 2015, users of Xingshan had walked a total of 2.8 million kilometres, raising more than US$ 4.6m for 52 different public welfare organizations and projects.

Facing the troubled reputations of charitable organizations, new types of charity platforms have stepped in to address both transparency and accountability issues. Real-time updates on donation collections, along with different verification systems, guarantee the funding reaches the right people at the right time. For example, JIAN Charity – launched by Alibaba’s Cainiao Logistics in 2016 – is an online donation platform where people can place orders and then track the real-time location of the items they donated.

When it comes to smaller donations – often a much more manual process – this kind of tracking can be challenging. By encoding the lifecycle of each donation on a blockchain, Ant Financial, a subsidiary of the tech giant Alibaba Group, addresses these transparency concerns and significantly reduces operating costs.

Embedded within a larger digital ecosystem like that of Alibaba’s, philanthropy has an even more magnified potential. On Taobao, an online shopping site, sellers can register for the “Treasures for Charity” program, allowing them to donate a portion of sales revenue to non-profit projects. Sellers not only draw more customers but this also boosts their conversion rate. Even though the per-deal donation can be as low as US$ 0.0058, the cumulative effect is significant: in 2017, 1.8 million participating sellers and 350 million buyers donated a total of 245m RMB (US$ 35.7m) to charity projects the world – owing to the enormous transaction volume and user base on the e-commerce platform.

A New Era for Philanthropy in China

China’s private wealth continues to expand, and philanthropy in the country is on an undeniably upward trajectory. New technologies are unlocking more inventive forms of giving, which become more synergized with companies’ mega business ecosystems. Public awareness about philanthropy is rising, while non-profit organizations are regaining their credibility and trustworthiness. I expect a brighter future.

Quote of Today (March 28)

“Like himan, organizations are driven by their subconsciousness. ‘Business as usual’ is the norm. That’s why many co’s can’t cope with today’s fast-changing environment. The leader’s job is to raise the level of consciousness of the organization so it’s fully alert.”

Quote of Today (March 27)

“The basic requirement of a qualified consultant is to excel in three types of leadership: Thought Leadership, Client Leadership and Team Leadership. Deficiency in any one of these dimensions would make a consultant incomplete.”

China and the Power of Tech-Enabled Philanthropy

By Edward Tse | February 2019

Dr. Edward Tse’s article on China’s philanthropy was published in the augural issue of Social Investor, commissioned by the Chandler Foundation.

From e-commerce platforms and Internet mobility service providers to AI and blockchain developers, Chinese technologies companies are transforming China’s economy and changing entire industries – including philanthropy.

China has a long tradition of giving, although it stagnated for roughly three decades when wealth was nationalized under the rule of Mao Zedong. Today, China is home to more billionaires – 819 in terms of US dollars – than anywhere else in the world, outnumbering the US and topping the Hurun Global Rich List 2018. And China’s super-rich are increasingly engaging in philanthropic causes.

According to Harvard University and UBS, between 2010 and 2016, donations from the top 100 philanthropists in mainland China more than tripled to US$ 4.6bn, and 46 of the wealthiest 200 Chinese billionaires now have charity foundations. Giving is much more common among ordinary citizens as well. It was reported that early in 2016, more than 20% of the total charity in China came from individual donors, a number that has grown steadily over the years.

Corruption and Transparency Woes Impede Progress

Despite those growing numbers, the philanthropic industry has been plagued by corruption and a lack of transparency. These are especially prevalent with non-profit organizations that claim to be government-supported.

In 2011, for example, a woman named Guo Meimei received a substantive amount of money from an official at the Red Cross Society of China, then flaunted her luxurious lifestyle on social media. In 2012, to cite just one other example, the China Charities Aid Foundation was accused of money laundering and embezzling.

For private philanthropists, a number of institutional and social barriers make it difficult for them to build, promote, and sustain charitable organizations. Policies mandating high expenditure rates and low administrative costs are two such barriers. Private foundations are required to spend a minimum of 8% of their previous year’s assets, making it almost impossible to grow an endowment. As a result, philanthropy remains a largely monopolized, state-run sector, and donations are largely limited to a few causes: education, poverty alleviation, and healthcare.

Technology – the Great Gamechanger

However, new technologies have helped bring innovative approaches to philanthropy and encouraged broader participation.

Tech giants, in particular, have already learned to take advantage of their branded merchandises to involve the general public in philanthropic activities. For example, in response to the 2008 Wenchuan earthquake in Sichuan, Tencent, the company behind China’s biggest social network as well as the largest gaming company in the world, established an online donation platform. More than half a million people contributed, raising a total of US$ 2.9m. Tencent added donation options to WeChat, the instant messaging and social media app with one billion monthly active users, and allowed users to give any amount with a swipe of a finger, making philanthropic engagement easier than ever.

New technologies have created more diversified ways of giving. The rising popularity of fitness apps in China has inspired tech companies to incentivize giving among the younger, more health-conscious, generation. Through the Xingshan (“doing good”) app developed by the Beijing-based company iMore, users record the number of steps they take each day, which is then “donated” to charities through corporate sponsors. By the end of 2015, users of Xingshan had walked a total of 2.8 million kilometres, raising more than US$ 4.6m for 52 different public welfare organizations and projects.

Facing the troubled reputations of charitable organizations, new types of charity platforms have stepped in to address both transparency and accountability issues. Real-time updates on donation collections, along with different verification systems, guarantee the funding reaches the right people at the right time. For example, JIAN Charity – launched by Alibaba’s Cainiao Logistics in 2016 – is an online donation platform where people can place orders and then track the real-time location of the items they donated.

When it comes to smaller donations – often a much more manual process – this kind of tracking can be challenging. By encoding the lifecycle of each donation on a blockchain, Ant Financial, a subsidiary of the tech giant Alibaba Group, addresses these transparency concerns and significantly reduces operating costs.

Embedded within a larger digital ecosystem like that of Alibaba’s, philanthropy has an even more magnified potential. On Taobao, an online shopping site, sellers can register for the “Treasures for Charity” program, allowing them to donate a portion of sales revenue to non-profit projects. Sellers not only draw more customers but this also boosts their conversion rate. Even though the per-deal donation can be as low as US$ 0.0058, the cumulative effect is significant: in 2017, 1.8 million participating sellers and 350 million buyers donated a total of 245m RMB (US$ 35.7m) to charity projects the world – owing to the enormous transaction volume and user base on the e-commerce platform.

A New Era for Philanthropy in China

China’s private wealth continues to expand, and philanthropy in the country is on an undeniably upward trajectory. New technologies are unlocking more inventive forms of giving, which become more synergized with companies’ mega business ecosystems. Public awareness about philanthropy is rising, while non-profit organizations are regaining their credibility and trustworthiness. I expect a brighter future.

Quote of Today (March 22)

Everything in the world is a duality (underpinned by a union or non-duality). Sun and Moon. Yin and Yang. Order and Chaos. Intellect and Creativity. Strategy and organizations all manifest in terms of duality. The best problem solvers are those who are aware of this and can consciously balance the forces within the duality in a dynamic manner.”

Quote of Today (March 21)

With major disruptions taking place on both the demand and supply side epitomized by technological changes, massive market scale and gradual retorms, China has become the world’s leading business laboratory. The country has transcended its identity as a market or a manufacturing and supply base, it has become a definitive source of cutting edge intellectual capital on strategy and business. The radiation of that source to rest of the world will impact how executives, investors, academics and professionals expand their thoughts on businesses.

Quote of Today (March 20)

Organizations are consisted of people. While most people are disillusioned by what their mind tell them, the same thing happen in organizations but with a much bigger scale. This is what we call “organizational subconsciousness.” Left to its own course, this could be dangerous and could lead an organization to deprivation. The job of a leader is to lead the organization to build and sustain its “organizational mindfulness.”

Quote of Today (March 15)

Quantum physics tells us that the world is not entirely physical nor entirely deterministic. Same applies to organisations. While there are physical and deterministic aspects to an organization, there are also non-physical and probabilistic aspects. Leaders must understand this in totality and incorporate this understanding in leading an organization forward.

【今日语录】3月14日

有人说:“我们已经不是咨询公司,而是伙伴公司。” 哦。正确的咨询是专业而不是生意;以客户的价值放在最重要的地位。咨询顾问与客户的关系是一种共生的关系,而不是一项买卖。所以咨询顾问就是客户的伙伴。咨询公司亦即等于伙伴公司。