James Chen, Chairman, Chen Yet-Sen Family Foundation: Alliance magazine interview

One of our goals here at Asian Philanthropy Forum is to share with you articles and interviews that we hope will provide you with insight into the mind and experiences of a donor. That is why we are pleased to share with you a great interview with Mr. James Chen, Chairman of the Chen Yet-Sen Family Foundation from the June 2008 issue of Alliance Magazine. Mr. Chen’s organizational strategy and experiences in working with NGOs sheds some light on what donors are thinking about. An excerpt of the interview is below.

… In deciding to establish a family foundation to conduct strategic philanthropy, Chen says he was drawing on what he saw as best practice at family office and family business conferences he had attended in the U.S. ‘The thinking within this whole family business/family office world is that philanthropy is one of the key components of a family enterprise,’ he explains. ‘I was exposed to the idea of strategic philanthropy and really thinking about the outcomes and impacts of giving, not just making emotional decisions to give or decisions based on a “you scratch my back, I’ll scratch yours” approach.’

… One thing that has changed over the five years is that they have become much more focused. Initially, the family lacked a well-defined sense of what areas they wanted to support, so they made grants in a number of different areas. ‘Through the process of feeling around and seeing what’s out there, you really start to get some sense of community needs and where we could make an impact. It was always at the back of ours minds that to have an impact you have to narrow your focus and support something that you really can become quite knowledgeable about.’ Now the foundation is supporting library programmes and early child literacy in China, Hong Kong, and Lagos, Nigeria, where the family manufacturing enterprise is based.

To date, the Foundation has supported over 150 libraries of different sorts, and Mr. Chen feels the family foundation has gained a lot of insight into its area of focus. ‘It was something we felt we could put our hands around. Quite frankly we continue to uncover new and innovative library programmes so I expect we’ll always be in the learning phase, but certainly we’ve learnt a lot in the last three or four years. We get the feeling that we are making a very significant impact in our area of interest in tackling a problem that is really a nationwide issue. At this point we are probably recognized as a thought leader in library programmes in China.’ Last year they held the first conference on school libraries in China.

Another thing that has changed is their mode of operating. Initially, Chen explains, they were more like a traditional foundation. ‘We were more of a relatively passive grantmaker, trying to get organizations to submit a proposal and then make grants.’ The problem they encountered in China was that ‘there are not a lot of good organizations that are up to standard’. As a result, they have become ‘much more proactive in helping some of these organizations raise their game, so to speak. I guess it’s different in places where the NGO community is much more developed. In a place like China, we find that we frequently add a lot more value to the organization by putting them through the process of applying to us for a grant. We don’t expect to give them money just for a specific programme. We are also, in a sense, building their infrastructure and capacity.’

While approaching a traditional foundation for funding could be likened to going to a bank and asking for a loan, the Chen Foundation is more akin to a venture capitalist. ‘We not only provide high-risk money but we also provide expertise and know-how and other types of support to make sure that the organization itself grows as well as the programme getting done.’ In one case, they set up a separate NGO to meet a need that wasn’t being met.

Chen feels this approach to philanthropy is consistent with the very entrepreneurial background of his family, and of many other Chinese families: being more proactive rather than just sitting back and waiting for grant proposals to arrive.

Is there anything that would have helped them along the way? ‘Our biggest constraint is that there are not enough NGOs out there that can really do the job,’ Chen reiterates. Even though they’ve been going for four years, they haven’t yet managed to spend the whole of the annual budget set aside for philanthropy.

What would be useful, though, is a network of other donors interested in the area that they work in – though they do ‘come across them haphazardly in our work’. In fact, he says, looking for like-minded donors was one of the reasons they put on the conference last year. As it turns out, the foundation was much more successful in meeting good NGOs who were doing interesting things than they were in identifying other donors.

What was Chen’s personal reason for setting up the foundation, as opposed to the family one? ‘I guess it very much has to do with my children,’ he says. ‘My worry is that they will grow up without a sense of values, family values and personal values. And it occurred to me that having the philanthropic arm to our family enterprise is really a very powerful way of transmitting values.’

Photo courtesy of UBC Library Graphics