China’s growing non-profit sector includes a wide variety of organizations with varying levels of official recognition, explained Chu Songyan in her recent lecture. Not only is the definition of “non-profit” inconsistent from a conceptual and regulatory point of view, but non-profit status is difficult to realize. The existing system raises high barriers for official recognition, particularly by requiring a “mother-in-law” sponsoring organization for non-profits. Not only must non-profits navigate overlapping-registration in this way, but also must adhere to a wide range of regulations on employment and financial practices.
This makes measuring China’s non-profit sector difficult, because resource constrained organizations are incentivized to operate as for-profit entities. Furthermore, China’s massive GONGO’s appear bigger on paper than their actual operations suggest. Employment data from 2014 suggests that registered NPO’s accounted for only .88% of total employment China, well below average for most countries around the world. When estimates include “grassroots self-governing organizations,” religious facilities, and GONGO’s the size of the NPO sector is more closely aligned with those of other countries.
“Path dependence in institutional arrangements dominates movement management and regulation of non-profit organizations in China,” says Prof. Chu. However, large gaps exist between institutional design and regulatory implementation are driven by the flexible allocation of government resources to non-profits. A spirit of “state-guided collaboration” has underpinned the real policy toward non-profits as government has recognized benefits of competent non-profits.
Natural disasters, like the 2008 Wenchuan Earthquake, have been turning points for charitable and non-profit organizations. These events have both spurred calls to reform regulation and drove up awareness among government and everyday Chinese of the potential role for non-profits. In March 2016, a new charity law was promulgated that allowed some categories of non-profits to apply directly to the Ministry of Civil Affairs for recognition. This will help to legitimize non-profit and charitable actors, enable government procurement from NPO’s, and create space for issue-focused organizations to pressure the state. Nevertheless, China’s non-profit sector continues to develop and evolve as it negotiates space between the market, the state, and the unmet needs of Chinese citizens.
Chu Songyan is Professor in the Department of Political Science at the Chinese Academy of Governance. Prof. Chu is a leading scholar in citizenship theory research, particularly on the development of citizenship rights in a changing China. Her research also covers public governance, government innovation, and public participation. Prof. Chu’s recent publications include Between the State and the Society: Function Transformation of Political NGOs in China (Chinese Academy of Governance Press, 2014) and “Building the Urban Community Disaster Relief System in China” (Natural Disaster Management in the Asia-Pacific, Springer, 2015).
The full presentation from February 10, 2017 is available for download here. Please do not modify or distribute this document without the permission of the author. Prof. Chu may be reached by email at firstname.lastname@example.org or by contacting the RCCPB.