The billionaire co-founder of Alibaba.com has set up charitable trusts ahead of the company’s highly anticipated IPO, a move that could mark the start of a new era of Chinese philanthropy.
Alibaba co-founder Jack Ma, along with current CEO Joe Tsai, said Friday that they have established two trusts funded by share options worth about 2% of the company. The philanthropic effort will initially benefit environmental, medical, education and cultural causes in China, according to a statement.
Ma said he established the trusts because “concern and complaints cannot change the current situation. … We must assume responsibility and take action to improve the environment that our children will inherit,” he said.
The establishment of the trusts makes Ma one of China’s first billionaires to set up a major philanthropic endeavor, and puts him in the ranks other successful executives who have pledged large portions of the fortunes to charity. Three of those — Michael Bloomberg, Bill Gates and Warren Buffett — praised Ma’s decision.
Nine months after Ma Chunhua’s baby was born, she was diagnosed with leukemia. Ma, a low-wage worker in Hubei province, said she grew desperate, knowing her family couldn’t afford the chemotherapy and bone-marrow transplant needed to save her baby. So she turned to China’s online masses, tweeting pictures from the hospital and posting their plight.
Chinese citizens are increasingly depending not on their government nor officially sanctioned nonprofits, but on Twitter-like microblogs called Weibo for donations.
The emergence of Weibo philanthropy has been spurred on by widespread suspicion and exasperation among Chinese with their government’s decades-long stranglehold over the social assistance and charity sector.
Current laws prevent the existence of any nonprofit unless it is partnered with a government-related entity. Even then, such groups cannot raise money — a right reserved for a small number of government-controlled charities.
And for the ruling Communist Party — in the midst of a once-in-a-decade transition of leaders — the trend towards Weibo fundraising suggests a troubling disconnect. The fact that increasing numbers of citizens would rather donate to random strangers online than to state-managed charities points to a growing distrust in government institutions. And donations to official charities has declined over the past two years.
“Weibo is putting great pressure on the government because it shows that if they don’t solve basic problems they are responsible for like food and health, the people will solve it without them,” said Deng Fei, a former investigative journalist.