Min Tang: Where is Philanthropy Leading Us in China’s New Normality?

On Janunary 23rd, Leping held its Annual Conference in Beijing. The following is the transcript of a speech themed with “Where is Philanthropy Leading Us in China’s New Normality” given by Mr. Min TANG, Board Chairman of Leping Social Entrepreneur Foundat

Min Tang: Where is Philanthropy Leading Us in China’s New Normality?

Date:  2015-01-26 22:31:31

Part 1 Nonprofit Sector Has More To Do under “New Normality”

 “New Normality” is a catchphrase we are increasingly familiar with, and one obvious feature of this “New Normality” is slowdown of China’s economic growth. From the perspective of the non-profit sector, it’s seems like a change of figure on the paper which has not brought much real impact, but in the for-profit sector, the impact is great. Because of this economic slowdown, some painful structure reform has to be done.

Economist Justin Yifu Lin said at Davos in 2015, that the soaring cost of doing business has driven a great deal of Hong Kong and Taiwan companies who invested in the mainland in the 80s to move their factories elsewhere. China has to transform its economic through upgrading. Economic downturn won’t be a short-term phenomenon, in which the non-profit sector will be more important, because the underprovided population are going to get the brunt of this difficult time, and nonprofit sector is more needed and has more to do.

There is a joke that a Chinese rich man sent his son to Germany for higher education. The son wrote back to his father: all the classmates are very friendly to me. There is only one thing a bit embarrassing. You see, I am the only one going to school on a Mercedes while everyone else take the metro. Father wrote back to him, no worries my son, I just sent you 200 million dollars to buy the metro. This joke actually reflects some harsh reality concerning widening disparity in Chinese society. On the one hand, we need the government to address social issues. On the other hand, this means the non-profit sector can do more, and our work is more meaningful, as a new round of poverty alleviation efforts are emerging in the non-profit sector. In terms of policies, it’s not enough to encourage the social entrepreneurs to donate some money. There is plenty of talk, but we need real social engagement that goes beyond fancy slogans or lip services. To achieve this, we need the input and involvement of all sectors.


Part 2 Scale up and Expand Impact with Internet under the New Normality

Other than doing more, we also need to innovate to expand our impact, because the public services we do now is too inadequate compared with the huge demand. These past days we’ve been discussing with Fuping (Beijing Fuping Vocational Training School) how to taking housekeeping training online to amplify its impact. Fuping has been offering domestic services training for a decade, lifting 30,000 households out of poverty, but this is just a drop in the bucket, in the context of the whole of China. We want to find the best way to offer long-distance, online education that is even accessible through smartphones. We want to offer thousands of online courses for people who want to learn domestic services, and in this way we can expand our impact. These courses can be useful not only to housekeepers, but also to anyone who want to take care of the old and young in the family, which will make us even more influential.

Now, when it comes to micro-finance, the biggest bottleneck we are facing currently is a lack of funding. We see trends of crowd funding and Internet financing in this field, which is not quite that easy. They find the poor people and put their information online, then use crowd funding to find people who wish to do good in the market, and mobilize the capital. Is there any new model for this?

One of the biggest advantages of Internet innovation is low cost of implementation. Nowadays Internet and even mobile Internet is largely available in China, disrupting the way people do business. So I think we should also utilize this trend in the field of philanthropy. I just published a book called MOOC Wave. I think there is a revolution in education where Internet permeates into the realm of education and profoundly change it. Why do I say it’s a revolution? Because it enables people to spread good educational resources downwards quickly, at larger scale and very low cost.

We’re all talking about education equality. In fact, equality cannot be achieved by conventional education. We can build the classrooms better, but the core of education—teachers, teaching quality—can not be evenly distributed between schools. Good teachers will always in the urban key schools. Even if we can evenly allocate these teachers between schools and rotate them every 3 years, students will still pick the class taught by good teachers, if they no longer pick schools. It’s impossible to realize equality in the traditional education model. But with Internet, it’s possible. We need innovation to share good teacher’s class to more people. What is innovation anyway? Innovation, in essence, is solving more issues by adopting different methods from others and from ones that we used before.


Part 3 Mobilize the Whole Society to Participate in the Philanthropy

Under the new normality, philanthropy should be social philanthropy, in that it should mobilize the whole society. Nationally speaking, what we should do is social poverty alleviation. Last year we did a lot of research and one thing we found out is that there were 50 million registered volunteers nation-wide, who are willing to use some time and effort to help others. But these 50 million people haven’t been utilized yet. They usually just go for some big event or go to the elder’s house. In fact, in the could have done much more if we mobilized them in the field of precise poverty alleviation.

Currently there are 400,000 officials working in poverty-stricken villages, building records to increase the precision of poverty relief. If we can make this information accessible on the public online, and connect the rural poor with urban volunteers using the Internet, we can have rational allocation of resources. If the underprivileged needs any help, they can go online and find useful information about technologies or market. SVP is also a useful way because has many professionals who wish to do something. What we lack in the society is a mechanism to organize and mobilize these people, to utilize their free time to make a difference. Maybe this is the next step of Chinese philanthropy. In order to push forward, we need constant innovation.

Under the new normality, we’ll see more social needs, as the increase of income widens the gap between the rich and the poor, between the underprivileged, the normal and the privileged. There is increasing urgency to make philanthropy play a more important role in wider social issues, which can not be achieved without innovation. Therefore, just as other productive forces, innovation is at the core of our (philanthropic) work, and the direction of our future development. For this, we need all your input. (End)