How Ronnie Chan And Ruth Shapiro Are Promoting Excellence In Asian Philanthropy
It takes a lot of courage to ask the famously fiery property tycoon and philanthropist Ronnie Chan for a favour, yet Ruth Shapiro asked not once, but twice. “The first time Ruth knocked on my door was in the ’90s,” remembers Chan, chairman of the Hang Lung Group. “Ruth said, ‘I’d like to set up an Asian business initiative. There are a lot of businesses in Asia that have been rising and successful, yet there are very few organisations that are pan-Asian for business leaders to come together.’ So, from 1997, Ruth and I worked together for maybe a decade in order to build up the Asia Business Council.”
The second time Shapiro came calling, it wasn’t about helping individuals, businesses and economies to generate more money. Instead, Shapiro wanted to find ways to encourage people to give their money away. “A few years later, Ruth knocked on my door again. I thought I’d got rid of her,” Chan says with a laugh. “Ruth said to me, ‘I think we should create a Centre for Asian Philanthropy and Society (CAPS). A lot of people have made a lot of money in Asia; it’s time perhaps for them to give back to society—and many of them are trying to do exactly that. So now is the time to do something regarding Asian philanthropy.’”
So, in 2013, CAPS was born with the goal of improving the quality and quantity of philanthropy and social delivery organisations across Asia. Shapiro, who is now chief executive of CAPS, leads a team of researchers whose work is funded by Chan and a handful of other leading philanthropists, including Tung Chee-chen and Victor Fung. CAPS is one of many philanthropic projects supported by Chan, who leads his family’s Morningside Foundation and is perhaps best known for his record-breaking US$350 million donation to Harvard.
While Chan continues to be philanthropic in conventional ways—by making donations, sitting on boards and more—both he and Shapiro hope that CAPS will shake up the ways in which philanthropy is conducted around the region. “CAPS is the first organisation of its kind really in the world—there’s very little objective research done into philanthropy in Asia,” Shapiro says. “So we’re learning a lot, but our goal is to increase both the quality and quantity of all kinds of social investment throughout Asia. Not just philanthropy but CSR [corporate social responsibility], impact investing, other types of ways to invest private money into making the world a better place.”
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But before Shapiro and CAPS could begin working on improving philanthropy in the region, she knew she had to conduct extensive research into the philanthropy that already exists in Asia, so she began work on the inaugural Doing Good Index (DGI). Billed as the first study into how laws, regulations and local culture help and hinder philanthropists around Asia, the DGI is an in-depth look at 15 economies around the continent that reveals both local and regional philanthropic trends. After two years of work—including surveying 1,700 non-profit organisations and interviewing more than 90 experts—Shapiro and CAPS unveiled the DGI earlier this year.
Unsurprisingly, philanthropy in the 15 economies studied differs greatly—but there are some overarching trends. First, across the continent, plenty of big donors—tycoons giving away tens or even hundreds of millions of US dollars—are doing it in secret. “I’m reminded of a gentleman who just unfortunately passed away recently, Mr Tin Ka-ping,” Chan says. “He was a really amazing gentleman who gave most of his wealth away and was so low-key. Hong Kong has quite a few of that kind of people and you’ve never heard their names.”
This quiet philanthropy is admirable, but Shapiro reveals there is a flipside. “Of course, we appreciate that humility,” she says, “but leadership by example is really powerful, too, and we want people to have models of behaviour to look at. So we’re trying to encourage people to be more forthcoming about some of the work that they’re doing.”
Another undeniable fact is that the internet is changing philanthropy. “The internet has two really powerful ways to affect the charitable sector,” Shapiro says. “One is allowing people to donate small amounts of money—you can really raise a lot through crowdfunding. The other is the watchdog function.” CAPS found that across Asia there is an enormous lack of trust in the charitable sector—and 10 of the 15 economies included in the DGI have had front-page scandals involving non-profit organisations over the past two years. The internet may help fix this, as it allows organisations to publish their finances so donors know exactly what their money is being used for. It also, of course, allows immediate and public condemnation of any organisations that are involved in anything improper or criminal.
Philanthropy in Asia is also changing as a new generation begins to give back. “The number one destination for all philanthropic dollars in Asia is education—then health, then the environment, then arts and culture,” Shapiro says. “Especially for the older generation, [philanthropy is about] giving to hospitals and universities. But their kids are willing to branch out from that. The kids are interested in social enterprises, impact investing, the arts, the environment, ocean conservation.”
Encouragingly, across the continent, philanthropists are being proactive. “People are out there doing things, they’re volunteering, they’re starting non-profits, they’re sitting on boards, companies are doing a lot around CSR,” Shapiro explains. Individuals and businesses are doing all this even if governments are still working out how to encourage philanthropy. “If government could catch up, it would be very powerful.”
It would be particularly powerful in Asia because the DGI shows people around the region are deeply respectful of their governments. “If the government is saying, ‘We encourage you to participate in philanthropy,’ then that matters in a profound way,” Shapiro explains. “The Singaporean government has done a great job with that,” Chan adds, citing Singapore’s recent change in legislation to give individuals a 250 per cent tax deduction on charitable giving, meaning they get S$2.50 taken off their tax for every S$1 they donate. “Singaporeans were never known to be philanthropic 10 years ago, 20 years ago. Yet because of government-led policy changes, the government have changed their societal norms, which is a great success.”
Singapore is one of only two countries, the other being Japan, that ranked in the top tier of the DGI, titled “Doing Well.” Hong Kong fell into “Doing Better,” the second of four tiers. “Hong Kong is an interesting case,” Chan admits. “I’m not sure if this is the best phrase, but Hong Kong is a philanthropic hub. People here are very, very generous and they are generous at all levels. We have a lot of big donors, businessmen are very generous and so is the average man on the street. That is something to be very, very proud of.”
So why didn’t Hong Kong make it into the top category? “Hong Kong tax incentives are low,” Shapiro reveals. “The 35 per cent [tax deduction for charitable giving] is signalling from the government that we’re not really invested [in encouraging philanthropists], when you consider that 100 per cent is really the norm for most Asian economies. And Hong Kong is plenty wealthy enough to provide those tax incentives so that people are encouraged to support the sector.” Another factor is that it takes longer to register a non-profit organisation—on average 360 days—than in any of the other 15 economies.
All of these factors may be further investigated by CAPS in future research projects, of which there are many. After launching the DGI, CAPS released its first study into the effectiveness of scholarships—“our findings are that scholarships are good,” Shapiro says—and the team has also begun investigating how government grants can best support social enterprises. CAPS has also committed to releasing the DGI every two years, meaning the next edition will be published in 2020.
Hongkongers may well be hopeful that the city will have changed some policies by 2020, which might edge Hong Kong into the top ranking of the DGI—but Chan thinks that is beside the point. “Hong Kong might change on the ranking of our [next] Doing Good Index, but another question is more important: has the quantity and quality of philanthropy really increased? That is our objective and the objective of CAPS.”
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