Jet Li and his wax statue. The action movie's One Foundation charity has now been registered as official, prompting other groups to consider a similar move. Yong Kai / for China Daily

Observers speculate whether going public will become the latest trend

BEIJING - Although Jet Li's One Foundation is now officially registered, experts are watching closely to see whether the move will herald a trend for philanthropic organizations or just be a flash in the pan.

Going public was considered by some to herald a bright future for China's near-1,000 grassroots charity foundations which haven't been allowed to raise funds from the public under Chinese law.

One Foundation, created by well-known action movie star Li to raise money for public welfare, is one of the most recognized foundations in China. Its operations are largely limited to its nominal affiliation with the officially recognized Chinese Red Cross Foundation.

"A baby without an ID card," was how Li described the organization. Its future was in doubt because its right to raise money from the public was uncertain. Its name in Chinese means "A foundation created by everyone donating 1 yuan".

The turning point came after an invitation from Shenzhen government official Liu Runhua, who is in charge of the special economic zone's civil affairs. Shenzhen is a national pilot for civil affairs reform, including the registration of foundations.

"What happened to One Foundation could give impetus to China's charity sector," said Wang Zhenyao, chief of Beijing Normal University's One Foundation Community Research Institute, and former director of the Ministry of Civil Affairs' social welfare and charities department, the magazine Caixin reported.

According to Wang, the foundation cannot afford to fail as a nationwide model. "If it does well, there might be a more open environment for grassroots foundations, otherwise there will be an about turn in the policy," Wang said.

China's grassroots foundations began expressing a desire for public fundraising in 2009, when China Charities Aid Foundation for Children was founded, Caijing reported. It said there are more grassroots foundations planning to go public, including one aiming to improve the quality of education in western China's villages. It has already begun the application process.

"The development of the opening up policy will be very prudential since new grassroots foundations are very competitive with official ones," according to Liu, who said that it would result in survival of the fittest. He added the relationship between charity organizations and the government should be as "trees and gardener".

Ministry of Civil Affair data shows that China had 1,847 charity foundations in 2009. A total of just 991 of them were permitted to raise funds from the public.

However, not all experts agree the One Foundation will set a precedent or trend for others going public. According to Caijing, Liu Zhongxiang, director of the grassroots organization administration bureau of the Ministry of Civil Affairs, said the government is strict over the registration of grassroots foundations because it fears the charity resources could be abused. He also said although the number of grassroots foundations in China has been growing at the high rate of 30 percent, the ministry has only admitted 20 public foundations since 2004.

According to guidelines for charity foundations released in 2004, every foundation must have "two parents" - one affiliated organization and the government to supervise them.

Shenzhen changed this regulation in 2006 so that all foundations can apply for registration directly to the government without an affiliated organization.

"The 2004 guidelines which categorizes the foundations into public and not public was actually progressive and at least acknowledged the legal existence of the grassroots ones," said Jin Jinping, director of Peking University's non-profit organization's research center.

"Although the One Foundation went public in Shenzhen, under given limitations it cannot raise money in other provinces, but it's not necessarily limited geographically," Liu said.

People can donate online using Tencent's Q currency, Alibaba's Alipay, and China Merchants Bank's credit card, which are platforms provided by the foundation's consultants.

There is a consulting team of 11 for One Foundation. Eah member is a top Chinese entrepreneur. They include the "Three Mas" - Tencent's founder Pony Ma , Alibaba's founder Jack Ma and China Merchants Bank's President Ma Weihua.

"The next step for One Foundation is to develop an institutionalized form and reduce my influence," said Jet Li.

Wang Shi, president of China Vanke Co, as one of the 11 consultants, was elected as the foundation's board director.

China Daily