Study on Sustainable Development of China's Philanthropy

Study on Sustainable Development of China's Philanthropy
ZHANG Yanli1, WANG Feng2
1. School of public management, Shandong Business and Technical College, China, 264005
2. School of law, Shandong Business and Technical College, China, 264005
[email protected]
Abstract: The philanthropy plays an important role in socialist construction, building a socialist
harmonious society and realizing sustainable development strategies. The charitable enterprises can
provide more material assistance to stabilize the social contradictions, pool of vulnerable groups,
strengthening the capacity of the community degree for the realization of sustainable development
strategies; can improve the moral standards of society, carry forward the traditional virtues of the
community to enhance the level of civilization; can share the government's functions, improve the social
security system to promote social harmony and sustainable development. Since the reform and opening
up China’ charity has entered a rapid period of development. However, because that the legal system is
absence, the culture is misunderstanding and the practicing system is absence, which make the
numerous charitable organization have few value, the charitable idea dim, the donation confused. We
should perfect our legal system, the developing method of the charitable enterprises and the charitable
idea to develop the charitable enterprises.
Keywords: Philanthropy, Sustainable Development, Strategy Harmonious Society
The 17th National Congress of the CPC proposed explicitly speed up the establishment to cover the city
and countryside resident's social security system's goal, Central Committee of the CCP General
Secretary Hu Jintao when hosting the Political Bureau of the Central Committee of the CPC the 13th
time of collective study stressed that speed up the establishment to cover the city and countryside
resident's social security system, must insist broadly covers, guarantees basically, multi-level, the
sustainable policy, take the social security, the society rescues, the social welfare as the foundation, take
the basic retirement, the basic medical service, the lowest social security system as the key point, take
the philanthropy, the business insurance as the supplement, the overall plan completes each work
coordinated, realizes the social security enterprise sustainable development. In the party's 10 Sixth
Plenary Session adopted the "CPC Central Committee on building a harmonious socialist society a
number of major issues", which explicitly proposed "to build social insurance, social relief, social
welfare, philanthropy, the coverage converges urban and rural social security system ", “the
development philanthropy, the perfect society donates the tax-free tax cut policy, strengthens the entire
social charitable consciousness”. This already was following party's 16 Fourth Plenary Session, the Fifth
Plenary Session, after in 2005, in 2006 "Government work report" and so on important document
proposes development philanthropy's another significant decision. In these important documents
mentioned repeatedly the development philanthropy, indicated the philanthropy in the socialist
construction, the construction socialism harmonious society, realizes in the sustainable development,
will play the influential role.
1.
Philanthropy and its relationship with sustainable development
1.1 Philanthropy
Charity has always been the traditional Chinese virtues. Confucius's "little children" thinking, the
concept of charity is the concentrated expression of the Chinese nation. With the development of the
original scattered, individual, occasional and random individual charity has developed into an organized,
large-scale, standardized and regular charity. As the inevitable human health, aging, illness, death and
other natural phenomena, sudden changes of disasters and social changes generated by such factors as
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the objective requirements necessary requirement for relatively strong for the relatively weak to provide
the necessary assistance, in order to maintain social balance and harmony. In this process, there is
always the giver and the recipient of two of the main opposition, but also the persistence of various
forms of charitable acts (such as contributions, donations, volunteer services, etc.), these acts together
with the factors that formed the charity.
The so-called charity, which usually refers to the many members of society to establish a voluntary basis
are engaged in a gratuitous, helps the less fortunate people in the rescue act. It is through legitimate
social organization, means of social contributions, according to specific needs, bringing together the
wealth together, and through legal means, for the inability to escape danger on their own recipients. This
is the third time distribution of the community a form of supplementary social security system. [1]The
existence of charity is one essential method for solves the "market failure" and "government failure".
Although the market can regulate the allocation of resources to achieve social balance, the market rules
of play to the extreme, inevitably produces monopoly concentration. It produces "market failure."
"Government failure" refers to the government hand's resources speaking of the social populace, is
extremely limited, is unable to satisfy the social populace's universal demand, under this situation, “the
government failure” is also inevitable.
Both states would undermine the social balance and harmony. There will present extreme rich and the
extreme poverty the opposition, will cause poor disposal of great social unrest. Charity is engaged in
voluntary unpaid basis, as a social assistance act toward vulnerable groups. In a sense, it can effectively
prevent "market failure" and "government failure" caused by a series of social problems, which can
effectively achieve social harmony.
1.2 The relationship between Philanthropy and sustainable development
1.2.1 Sustainable development's realization is by realizes the socialism harmonious society the same as
eliminating poverty, assisting the weak one, realizing the common enrichment for the goal.
Philanthropy’s development may provide the more material help, hold down the contradictory of society,
condense the minority groups, and strengthen social altogether accommodation.
Sustainable development includes many-sided sustainable development such as population, organism's
habits, resource, economy and society. The sustainable development target is that these aspects realize
harmonious development ultimately. In other words we are making great efforts to structure harmonious
society of socialism, and keeping down. But there are all kinds of social problem back to existence at
present in this one process. Therefore, must display the philanthropy this society harmonious lubricant,
stable's function fully. In all types of natural disasters in 2009 caused a total of approximately 47,933.5
million (times) in varying degrees affected, 1528 people dead and missing tolls; area of 47213.7
thousand hectares of crops affected, an increase of 18.1%. Crops area of 4917.5 thousand hectares, an
increase of 22.0%; 838,000 houses collapsed; direct economic loss of 252.37 billion Yuan. [2] These
needs relying solely on government finance to meet the impossible is not realistic. The development of
philanthropy can effectively provide material to draw on community resources to effectively satisfy
unfortunate the objective need.
With the continuous deepening of China's socialist construction, in and scored remarkable achievements
in economic development at the same time, there is an increasing gap between rich and poor social
problem. Beijing College of Management Professor Bai Jinfu's view reflects the income gap status of
the Gini coefficient in 1981 was 0.288,1990 0.343,1999 0.397. Years into the new century is basically
the level of development in 0.4 above, to reach 0.46 in 2003 continued to increase after the present, and
the Gini coefficient in China is close to 0.5. Show that the gap between rich and poor in China has been
in a large range of international practice. To alleviate the gap between rich and poor brought about social
conflicts, cohesion vulnerable groups we must play a "third distribution," the role of philanthropy in
urgent need of development. As the third time allocation is conducted on a voluntary basis without
compensation act, it plays the role of balance the income gap which both market and the government
can not solute. As the charity to the rich pays back the community's broad platform, so it can play
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stabilize the income gap and keep the role of social contradictions. Also, because philanthropy is always
to care for vulnerable groups of society, responsibility to help poor people, therefore, vulnerable groups
can play an important role in cohesion. Only staff at all levels of society together into a whole in order to
form a community of nations to reinforce social altogether accommodation.
1.2.2 The realization of sustainable development strategies needs to take realizing highly civilized moral
standards as target. Development of charities may improve society moral standards, bring honor to the
traditional virtue, and promote the degree of social civilization.
Undeniably, although government's each policy, the system can melt some not discord or disharmony
phenomenon in the current social development process by the civil rights strength rigidity, the rigid
institutional arrangements are impossible to solve all social problems. Because there is not completely
the rigid standard and the restraint in society’s the harmony and sustainable development, but also needs
the motion voluntarily. Moreover, looking from Maslow’s hierarchy of needs theory, people after having
satisfied the basic material needs, will pursue in top level spirit satisfying. The philanthropy gave to
realize in exactly the top level the spiritual satisfied platform. And the philanthropy is changing the
people and society's whole moral level by the moral, the spirits, and the culture and so on various
aspects function which the rigid system did not have. The civilized degree in a national, social and
nationality is a very important target, but philanthropy's development is an important factor to manifest
this target level. Therefore development of the charities, taking offering the loving heart as a tribute,
helping the distressed and succoring those in peril as basis may have an effect to improve society moral
standards, brings honor the traditional virtue, lifting degree of social civilization.
1.2.3 The realization of sustainable development strategy is taking the perfect social security system as
the premise. Philanthropy's development may share the government function, perfect social security
system, and promote society comprehensive harmony and sustainable development.
"The China's Agenda 21" will solve the relations between the population and the development and take
them as one of strategic priorities. It will consummate the social security systems included by the 21st
century agenda. The report of The 16th National Congress of the CPC proposed: Must place the
sustainable development the very prominent status, establish the comprehensive affluent society and the
establishment improve the social security system which adapts with the economic development level to
relate. Social security system's establishment is not only to realize the reduction income differential and
melt society contradictory. It but also promotes the population and the economy, and social sustainable
development.
In addition to government-led basic social protection system, social security system usually includes a
variety of complementary forms, such as enterprise annuities, mutual protection, employee welfare and
charity. At present, China is in the development process of economic transformation; social security
reform has changed the past by the government and arranged a variety of corporate welfare tradition.
Many social services in the past by the government or enterprises need to undertake by the various
social groups. Therefore we need establish a multi-level, comprehensive social security system under the
efforts of government, society and the individual. Philanthropy, which can effectively share the
government functions, can improve the social security system to achieve comprehensive social harmony,
to provide protection and sustainable development.
2.
The analysis of charitable status in China
Since China's reform and opening up charity has entered a rapid development period. In April 12, 1994
the establishment of the China Charity Federation, this marks the charity of China taking the road of
healthy development. However, the development of China's charity still has many problems.
2.1 Although the large number of charitable organizations, the effect of them is limited and mostly
of them is lack of independence.
By the end of 2006, China registered in various non-governmental organizations about 354,000. [3]
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However, compared with economic and social development of more mature countries, our country's
foundation quantities are few, the fund scale is small, the function is limited. In a large number and
limited role of charitable organizations, majority are government's Functional departments's accessory.
Even the government personnel hold a concurrent post in them. Thus the philanthropy which is the folk
enterprise essentially has smeared the thick administrative color. In some kind of degree they become
government's enterprise.
Take "Act of Foundation Administration" as the example, although the present stipulation encourages
the folk philanthropy the development. The government till had set up the high threshold to the
foundation. Especially implements dual management stipulations to the foundation the Business agency
and the registration department.
2.2Charity idea is indifferent in China. The number of individual donations especially wealthy
donors is small. Individuals still can not be the subject of a charitable donation.
There is 5.63% in the income of Chinese associations and foundations from corporate donations in 1998.
By 2002, this proportion had risen to 6.44%. In 1998 the income of Chinese associations and
foundations, there is 4.16% from individual donations. By 2002, this proportion dropped to 3.19%. U.S.
private donations account for 2.1% of U.S. GDP in 2002, while private donations account for less than
0.01% in China's share of GDP.[4]
In June, 2006, 75-year-old U.S. investor Warren Buffett decided to formally donate more than 85% of
his wealth - about 37.5 billion to Bill Gates • Charitable Foundation founded by Mr. and Mrs. Gates. It
sets the record of world individual charity in the money sum. Gates had already donated more than 300
billion dollars, and decided to donate more than 99% of the property to the community after his death.
The statistics from the China Charity Federation shows that China Regal on charitable donations is less
than 15% of the social wealth; they have public wealth actually above 80%. There is only 1% of more
than 10 million industrial and commercial enterprises registered in China, which had participated in
charitable donations. [5] The data above shows that the number of individual donations is too small,
especially the wealthy donors in our country. Of course, due to differences in national circumstances, the
United States, charity is a personal donation as the main body, and our current situation is a corporate
donation as the main body. But even at the corporate donations as the main case, the number of
donations is also tiny. It’s difficult to develop our charity further.
2.3 The donation behavior is chaotic. The donation fund, the commodity is lack of supervision. So
the charity loses its credibility gradually.
Under the donation behavior function which is lack of the standard, the result is inevitably that the fund
donated either not arrive, or is diverted, even was put into individual pockets. These behaviors and the
results have harmed the credibility of philanthropy. In the factors of people refused to donate, the
concerns for the flow of goods donated have increasingly become a major factor.
2.4Government regulations on the use of charitable funds are rigid. And it neglects hematopoietic
function of charitable funds. These make our charitable funds without the material basis of
sustainable development.
At present, China's regulations on government-raised funds is that "Foundation for public welfare
spending is not less than 70% of the current year income (donations accepted, capital operating
income)." Many fund or charitable organizations are almost exhausted in the current income year. Even
if the part left, they did not dare to invest to benefit lest at risk. Our charitable focuses only absorb
nutrition from the community, rather than focus on their own charitable funds. So this kind of charity
has not vitality. U.S. law on the charitable funds is that each year only 5% of the money is spent out.
And the remaining can be used to invest, which continues to enlarge the principal charity to scroll value,
and continue to do charity.
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3.
The path to the sustainable development in China charity
3.1 Perfect charity legislation for the further development of charity to provide legal protection.
3.1.1 The development of charity law as soon as possible for the development of philanthropy to provide
basic, legal guidelines. Charities Act, charitable organizations should be clear legal status, the main body
of charitable donations, charitable donations of the monitoring mechanism, the competent authorities of
philanthropy, charitable donation program, specifically donors, recipients and beneficiaries of the rights
and obligations, norms charity cause of access, assessment, monitoring, public property rights to define
and transfer, investment, exit and other acts.
3.1.2 Improve the procedures charity law in order to complete the program to form the charity's
credibility. In charity law and related laws, we should pay attention to procedural law. Through the
process open, fair, equitable, transparent and democratic characteristics reflect the philanthropy of the
"sunshine”, which full realize the regulation of charities. Improve the charity's credibility among the
population in the full and whole process of regulation.
3.1.3 Amend the existing legal provisions related to charity and form to encourage, guide, and monitor
the development of the legal system philanthropy. First of all, government should give tax relief on
charity to give more concessions to the formation of willing donors of economic incentives. Secondly
cancel the rule that the charitable organization must have authority to ensure the independence of
charitable organizations. The third-party evaluation of civil non-profit organization should actively be
introduced to charitable organizations and their fund supervision and management.
3.2 Establish the perfect mechanism to develop the philanthropy, provide in system's safeguard
for philanthropy's further development.
3.2.1 Expand philanthropy's participation main body and the fund raising channel. In the existing special
philanthropic institution such as the international humanitarianism's organization, the other participation
charitable activity's nonprofit public welfare social group's foundation, attract more main body
participation philanthropy to expand the philanthropy fund raising channel.
3.2.2 Establish the perfect administration of the fund operation mechanism and form philanthropy's
good circulation. To the charitable fund’s management operation may adopt the fund management; the
direction detection solicits donations and so on many kinds of ways. But in the concrete operation
process, we must avoid the congenial tendency. The charitable fund's operation should insist the low risk,
the high reward's principle. And purchase the government and the enterprise bond primarily, when
investment time short, effective quick project, the government deals with its investment to implement
the investment protection. At the same time, we should implement separates the method between solicits
donations and rescues.
3.2.3 Establish the perfect philanthropy's supervising mechanism. Put the standard on solicits donations
the behavior. Perfect the endowment of society capital and the goods management. Establish the social
public announcement system. Regular announce the origin and flows of capital endowment and the
goods. Establish completely transparent public referral system to guarantee that donor's wish obtains
carries out effectively. Strengthen the charitable fund specially the supervising mechanism; adopt the
internal surveillance to carry on with the outside supervision in both ways.
3.3 Strengthen the propaganda vigorously to raise populace's charitable consciousness.
We should develop the social network of the charitable work; use each kind of information channel,
especially full use news media's strength to further strengthen philanthropy's propaganda report.
Through the multiform charitable cultural event, such as the benefit performance, righteousness racket,
the charity bazaar, give free medical treatment and so on. Expand philanthropy's social impact, bring
honor to the charitable idea and build the atmosphere which the philanthropy must diligently need. We
must realize that populace’s charitable consciousness is the basis to promote philanthropy’s
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development.
In philanthropy's development, government's function should locate explicitly in the guidance, the
safeguard, the supervision, but cannot be taken as all things. But one point need to be clear is that
government and philanthropy cannot substitute mutually. Be going to completely eradicate the thing
belonging to the government scope of official duty inner originally determinedly, shifting to society but
in the name of charities, the collective provided by society the member. Leaving being damaging alone
not only being lack of ability for the government in developing charities, it has possibility damage's
more the public believes to society, the public and the government. Therefore, being in development of
charities, each the function must be distinguished between the government and charities.
Fund Project:
Soft Science Project of Shandong Province in 2009: Stage Research Result of "Study of Relationships
Between Government and social Organizations In the Construction of Harmonious Society"
(2009RKB408).
References
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Academic Press, 2000 edition. (in Chinese)
[2]. Source: http://www.mca.gov.cn/.
[3]. Young Qunying, Wu Liyue. Our civil society organizations’ "grassroots" situation and reform of the
current registration system [J], Xiangtan University (Philosophy and Social Sciences), 2008, No. 3.
(in Chinese)
[4]. Deng Guosheng. The development of individual charitable donation is the cornerstone, [J],
Academic Journal, 2007 (1):133-134. (in Chinese)
[5]. Wu Zhiru. Charitable indifferent interrogate Chinese rich and powerful people, [N], legal
institutions weekly with torture, 2006 9 4. (in Chinese)
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