Public demand greater transparency of charities following Red Cross trust crisis

Although the Red Cross Society of China (RCSC) has boosted its public disclosures to regain credibility following a trust crisis in June, the public is still blasting the group, as well as other Chinese charities, for a lack of transparency.

The RCSC launched an online information platform on July 31 to provide more transparency following a credibility crisis that resulted from a scandal that allegedly involved the misuse of donations.

The RCSC came under fire following a scandal revolving around a young woman calling herself “Guo Meimei.” The woman claimed to be a general manager for “Red Cross Commerce,” a group that the RCSC said does not exist.

The woman posted many photos on her microblog detailing her lavish lifestyle, provoking the ire of netizens who speculated that she might have funded her extravagant purchases by embezzling money from the Red Cross Society.

Information regarding donations to areas devastated by last year’s 7.1-magnitude earthquake in Yushu was among the first data uploaded to the online platform.

The website has attracted more than 18 million visitors to check out donation information, as well as the RCSC’s auditing and fiscal reports.

However, many of these visitors have raised questions and are demanding even greater transparency, as information regarding the use of donations has been described as being too generalized. 

NOT ENOUGH INFO

Donations by individuals must exceed 100,000 yuan (15,500 U.S.dollars) and those by organizations must exceed 500,000 yuan in order to be disclosed on the website. The public has questioned the high threshold for information disclosure.

In addition, the website only features information on donations made after Jan. 11, 2010; information regarding donations to the Chinese Red Cross Foundation (CRCF) and the RCSC’s local branches is not available at all.

A lack of transparency is common for Chinese charity organizations.

The 2011 Annual Report on the Transparency of Chinese Charities, released by the China Charity & Donation Information Center, showed that 75 percent of charities failed to properly disclose information about the use of project funds, operational costs and other information.

VAGUENESS IN VOGUE

The exact location and use of charity funds are often kept in secrecy by the country’s charity groups.

One entry on the RCSC’s website showed a 200,000-yuan donation by Hong Kong musician and actor Andy Lau; however, there is no information regarding how his donation was distributed.

On the official website of the China Foundation for Poverty Alleviation (CFPA), information relating to donation usage is either completely missing or is present in the form of vague descriptions such as “quake relief” and “education for orphans.”

According to the 2011 Annual Report on the Transparency of Chinese Charities, over 90 percent of respondents said they had never received any feedback from charities after offering donations.

“I donated 2,000 yuan after the Wenchuan earthquake hit, but no one has ever told me where my money went,” said Shanghai resident Gao Min.

Wang Zhenyao, dean of the One Foundation Philanthropy Research Institute at Beijing Normal University, said the distribution of donations has to go through bureaucratic red tape, which results in a lack of efficiency and transparency. 

WHAT’S THE CAUSE?

Wang said that most public charities in China are government-sponsored organizations. He said these organizations have neither the motivation nor the pressure to disclose information properly.

Although there are laws and regulations in place that tell charity groups how they should disclose their information, specific guidelines are lacking, he said.

Experts have called for instituting third-party supervision over the operation of the country’s charity groups.

Lu Hanlong, vice president of the Chinese Sociological Association, said there should be a supervision system in place that integrates third-party evaluation institutions, the media, donators and the public.

The aforementioned Guo Meimei scandal was far from being the first of its kind. The former vice chairman of the RCSC’s Kunming branch was previously accused of using donations for personal use. A cashier working for the RCSC’s Wenzhou branch was found embezzling 1.26 billion yuan over the course of five years.

Statistics from the Ministry of Civil Affairs show that the total amount of donations made last year stood around 100 billion yuan

Liu Youping, vice director of the China Charity & Donation Information Center, said transparency is the lifeblood of charities, adding that the public will not fully restore its trust in charity groups until the information they demand is made publicly available. Source: People’s Daily

Leave a Reply