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3 Questions: Transparency and Generosity

From the series 3 Questions

The Global Generosity Network and the Evangelical Council for Financial Accountability (ECFA) are teaming up to put on two Generosity Roundtables in Hong Kong April 18-19.

As ECFA International Liaison, Dr. Gary Hoag interfaces with leaders around the world who are discovering the importance of transparency for organizations. In the experience of ECFA, knowing that pastors and ministry leaders are committed to transparency and annually offering a report of the use of funds gives God’s people confidence to give and serve more generously.

Dr. Sas Conradie heads up Global Generosity Network, inspiring global Christian stewardship, generosity, and giving.

Here we talk with Sas and Gary about the relationship between transparency and generosity.

3 Questions

[The answers to our 3 Questions are edited composites of the two men’s responses.]

1. With the growth of the philanthropy sector in China comes a greater awareness of the need for transparency in the nonprofit sector. What do you see as the relationship between transparency and generosity?

The Scriptures attest that transparency regarding finances inspires greater participation in the gospel. The Apostle Paul connected transparency and generosity in how he rallied God’s people to give to the Jerusalem collection (cf. 2 Corinthians 8:20-21). When God’s people have a clear sense of what is happening with ministry finances before God and man, they are more open to giving. Financial transparency should improve trust, which should increase giving to NPOs and charities.

Trust is therefore an essential factor when people decide whether and how much they want to give financially to organizations. The following chart (strangely enough from the Center for Food Integrity in the USA.) shows very well the different elements of trust. One of them is to disclose information which would include financial information about the organization. In other words, an organization needs to be financially transparent to attract financial support.

However, there does not appear to be as strong a connection between transparency and generosity in China. According to the Edelman Trust Index 71% of people in China trust NPOs in comparison to 58% in South Korea, 62% in Singapore, 57% in Hong Kong and 34% in Japan.

However China ranks 144th out of 145 countries on the CAF World Giving Index with only 8% of the population giving financially to NPOs or charities. The trust in NPOs in China as indicated in the Trust Index therefore does not result in actual giving.

Trust in Hong Kong is much lower; 57% of the general population trust NPOs. However, Hong Kong is ranked 26th on the World Giving Index with 63% of people who gave money to charities. This is much higher than for example the 34% of people in South Korea who gave money to charities.

2. Can you point to examples in the Asian context where transparency made a difference in Christian philanthropy? 

It is difficult to get specific information, but according to the Giving Korea 2014 report 85.7% of givers in Korea take the reliability of organizations into account when making gifts while 90.7% of givers consider the operational transparency of organizations when making gifts. To enhance transparency and accountability in the charity sector and to promote informed giving in Singapore, the Office of the Commissioner of Charities (COC) started making the financial statements of all charities available online for free viewing via the Charity Portal in August 2014. 

In Hong Kong public concern is growing over how charities are regulated, and there have been calls from many quarters for tighter controls and increased transparency to be implemented. There is no Charity Commission in Hong Kong. The Hong Kong Law Reform Commission recommended that a set of specifically formulated financial reporting standards should be adopted for charities in Hong Kong. For the purpose of facilitating good practice, the Commission recommended that charitable organizations should be encouraged to work with institutions/organizations to facilitate good practice and to improve co-operation between charitable organizations and the Government. The Hong Kong Government should take a leading role to enhance public awareness of charitable organizations and their operations, as well as the rights and duties of donors.

3. What steps do you feel Christian leaders in China can take to increase transparency?

In the USA, ECFA was formed in 1979 in response to the threat of increased government regulation of charitable giving with ministries. Since then other nations have formed similar associations: Korea (CCFK—Christian Council for Financial Transparency, Korea), Philippines (CCTA—Christian Council for Transparency and Accountability), Australia (CMASC—Christian Ministry Advancement Standards Council), and Kenya (AfCAA—African Council for Accreditation and Accountability). Ministry leaders and financial professionals in these countries have mapped out standards for “peer accountability” to encourage greater participation in God’s work.

By peer accountability, we mean that volunteers from member organizations serve on a board that ensures members comply with basic standards. Volunteer leaders (or someday paid staff members) oversee membership and annual compliance review. In so doing, a community of members who share a common seal give confidence to God’s people to give. Here’s a 2-minute video (in English) about ECFA that illustrates this.

In view of the recommendations by the Hong Kong Law Reform Commission we wonder whether some kind of Christian financial accountability body in Hong Kong could improve financial management and transparency standards of churches and Christian organizations in Hong Kong. This would then increase generosity in Hong Kong.

This is something that will be discussed at two roundtable discussions in Hong Kong on April 18 and 19. These discussions (one on Hong Kong Island and one in Kowloon) are being organized by the Global Generosity Network and ECFA. We will look at how improved financial transparency among churches and Christian organizations can result in increased trust and greater giving to churches and ministries. I hope greater Christian influence could result in greater financial transparency in the Hong Kong business community which should result in a better business environment.

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Brent Fulton

Brent Fulton

Brent Fulton is the founder of ChinaSource. Dr. Fulton served as the first president of ChinaSource until 2019. Prior to his service with ChinaSource, he served from 1995 to 2000 as the managing director of the Institute for Chinese Studies at Wheaton College. From 1987 to 1995 he served as founding …View Full Bio

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