Charities face uphill challenge to win public trust

One Foundation, started by Chinese kung fu movie star Jet Li in 2010, has faced allegations of embezzlement recently. In mid-April, the foundation issued an auditing report on projects undertaken to help the victims of the 2013 Lushan earthquake. According to the report, only 49 million yuan ($7.8 million) of the total 385 million yuan worth of public donations was spent, covering a mere 12.7 percent.

"Where have our donations gone?" Following this question on Weibo from , formerly the anti-CNN website founded in 2008, netizens rushed to suspect if One Foundation was corrupt. The foundation announced that it would file a defamation lawsuit against , and the website said it was ready to face the lawsuit.

The episode took place not long after actor Li Yapeng's SmileAngel Foundation came under scrutiny for mishandling donations. Both foundations are private charitable organizations. After the 2011 Guo Meimei incident, which led to the corruption scandal of the Red Cross Society of China, official charities suffered a severe credibility crisis. Netziens soon started a campaign calling for the boycott of donations to the Red Cross. In the wake of the 2013 Lushan earthquake, One Foundation, a newly established private charity, ranked among the top five charities in terms of public donations.

But private charities also face the challenge of winning public trust in China. There are various doubts surrounding One Foundation, including its close ties with a former official, and its 1.17 million yuan donation to a sports association headed by one of the foundation's board members. In an open letter to refute the corruption allegations, Jet Li asked if anyone could teach him how to embezzle money, since he himself didn't have the authority to transfer the funds, while each of the board members owns a company worth billions of yuan and does not even know how to split that little bit of money.

Apparently Jet Li's humor isn't enough to dispel public suspicion. One can find a thousand reasons to defend these charity organizations, such as the unreasonable stipulation from the government that a charity must spend at least 70 percent of its total revenue from the previous year, or the fact that an efficient, mature chain for charity operation hasn't been established in China yet. The later, some argue, explains why One Foundation may raise money quickly and spend slowly.

Nonetheless, unless the public can see clearly how the money they donated is spent, a trust crisis can crop up anytime.

In a recent interview, actor Li Yapeng said that the public should have more understanding of China's charity environment, otherwise the enthusiasm for public good and charity might be undermined. It's a reasonable point. But the painful fact of misunderstanding he referred to might be something that Chinese charities cannot avoid.