The State Council’s “Regulations on the Management of Foundations” only allow for public foundations to legally conduct public fundraising. As a result, grassroots NGOs’ financial support mainly comes from targeted fundraising within a limited circle of acquaintances and business contacts. While many NGOs are eager to develop stable fundraising channels, they need greater access to the community.
The Concept of Lianquan
This is where Shanghai United Foundation (SUF, also known as, Lianquan) comes in. SUF grew out of Nonprofit Incubator (NPI), an NGO service center. As NPI worked with grassroots NGOs, they noticed that these organizations needed a public, independent and efficient fundraising platform that could help them to develop stable financial support. A public foundation was the only type of organization that could fill the role in China, and so SUF was born.
SUF officially began operation in December 2009. While public foundations are allowed to fundraise, they are not inherently fundraisers for other NGOs; therefore, SUF holds a new and unique position in the social sector. Similar to the US-based United Way, SUF fundraises from corporations and individuals, and then allocates donations to grassroots NGOs in China. Lily Qu, a project manager at SUF explains that, “this position allows SUF to raise funds publicly and cooperate with grassroots NGOs.” Individuals, companies, and foundations can all donate funds to SUF that will in turn be granted to grassroots NGOs.
SUF’s Next Step and Plan
Launched less than one year ago, SUF is still in the process of developing its model. Currently, SUF is focused on planning and organizing fundraising activities while developing a network of grassroots organizations. Granting will focus specifically on projects that fall into the categories of education, community development, poverty alleviation, and healthcare.
SUF plans to use three strategies to conduct their fundraising. One is through online general funding. People who want to donate to grassroots NGOs can give money to SUF’s public fundraising bank account.
“It’s like a funding pool,” Lily explained, “When nonprofits need financial support for project implementation they can submit their project proposals to SUF. SUF will conduct an assessment of each organization and the proposed project. Finally, SUF will allocate funding according to their evaluation. SUF will also track projects’ progress and compile periodic reports to inform the public on the status of these projects.”
Second, SUF will use targeted project fundraising. For example, every month SUF will align with an NGO partner to organize tangible fundraising and promotion activities for them. Different from online donations, these opportunities could range from an information booth at a mall to a citywide Flag Day (a popular fundraising event in Hong Kong) where the public can interact face to face with grassroots NGOs. In October, SUF started its first two targeted funding projects with Raleigh China and Haihui Heifer China (海惠小母牛). Through their partnership with SUF, these two NGOs can now pursue public fundraising activities in the future.
SUF’s third fundraising strategy combines fundraising and CSR by partnering with multi-national companies and finding creative ways to engage employees in philanthropy. One idea is to raise funding through companies’ annual year-end dinner parties. SUF would help companies choose one or more NGOs from their database and ask employees to donate items for an auction to be held at the party. All proceeds from the event would go to the chosen organizations.
While much of SUF’s model is as yet untested, the organization has a firm commitment to take the time to develop responsibly. SUF wants to maintain partnerships with grassroots NGOs that are flexible, practical and responsible by balancing NGOs’ needs while maintaining transparency. “Lianquan is eager to work together with grassroots NGOs. We have ideas and plans, but it will take time to put them into practice,” Lily said.
SUF has committed itself to be accountable for every dollar they receive, respond quickly to NGO projects, and promote positive and measurable outcomes. In so doing, they want to work towards building the public’s trust in donating, and hopefully encourage more charitable giving, strengthen the grassroots NGO sector and ultimately to build healthier communities.