Postquake Fundraising Flop Exposes Credibility Failure at China’s Red Cross

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Xinhua / Sipa USA

Lights stay on in temporary tents set up by the Red Cross Society of China in the Lushan county of Ya'an City in southwest China's Sichuan province on April 21, 2013

When a 7.0-magnitude earthquake hit Lushan county in southwestern China’s Sichuan province on April 20, killing almost 200 people, the Red Cross Society of China (RCSC) did exactly what you would expect of China’s largest charity — it took to traditional and social media to solicit donations for those affected by the disaster. What was less expected was the unsympathetic reaction to the appeal.

In the 24 hours after the earthquake, normally prime time for fundraising, the RCSC raised a paltry $23,000, small change compared with the $3 million raised by the One Foundation, a charity founded by movie star Jet Li. The problem was not that the Chinese public did not want to give money — the problem was that they did not want to give money to the RCSC. On the RCSC’s official account on Weibo, China’s Twitter-like service, the organization’s post requesting donations solicited pages and pages of scornful responses.

The disastrous fundraising campaign is the latest embarrassment in a long-festering public relations crisis for the RCSC. Founded in 1904 as a privately run organization, the RCSC was recognized by the international Red Cross federation in 1952, but since then has come under ever tighter government control — and with that has come growing distance from the public. Indeed, so close are the government ties that since 1996, RCSC employees have been technically regarded as civil servants.

(PHOTOS: Deadly Earthquake Strikes China’s Sichuan Province)

Vitriol against the RCSC has been festering for years, amid public anger over the organization’s lack of transparency and rumors that the government officials who run the organization have had their hands in the coffers. So deep is the suspicion of Chinese officialdom in general that Hong Kong’s legislature last week refused to vote an almost $13 million donation to the Sichuan authorities for relief in Lushan for fear the money would be misused.

The RCSC received more than $700 million after the 2008 Wenchuan earthquake, but questions about how that money was used have lingered. Things came to a head in 2011, when a young woman who claimed to be a business manager at the RCSC began posting pictures to her Weibo account that documented her lavish lifestyle and luxury purchases. Guo Meimei’s wardrobe included dozens of Hermes bags and other high-end pieces, which she displayed proudly while sitting behind the wheel of a Maserati or Lamborghini, or perched in first-class seats on airplanes. Vigilant netizens demanded to know how a midlevel employee at an NGO could possibly afford this type of lifestyle. Though the RCSC pleaded innocence and denied that Guo was even an employee, its reputation was left in tatters.

Leading Chinese writer Bei Cun spoke for many when he wrote on his Weibo account, “I assert: the Red Cross Society of China cannot be changed, its credibility is bankrupt and it cannot change its ways.” He also drew attention to the fact that the RCSC is not operated by the International Federation of Red Cross and Red Crescent Societies, “just like Chinese PEN has nothing to do with PEN International, and the Chinese Catholic Church has nothing to do with the Vatican.”

(MORE: More Pain in Sichuan: Earthquake Kills at Least 192)

Staff at other charity organizations complain bitterly that the RCSC gives the whole sector a bad name. “I don’t trust the Red Cross Society of China — for one thing, they are far too inefficient,” Yuan, a volunteer raising funds for victims of the Lushan earthquake, tells TIME. Since the earthquake, the 38-year-old entrepreneur from Chengdu, in Sichuan province, has been gathering donations and ferrying funds to the disaster zone quickly, a process he says his small group can handle more efficiently than the bureaucratic RCSC.

“From the time we receive the donations to the time we pass the funds over to the victims, it takes us only five hours,” says Yuan, who declined to give his first name because of the sensitive nature of the issue. “Can the Red Cross do that? Of course they can’t.”

Indeed, according to the RCSC’s own figures, as of April 24, four days after the earthquake, it had distributed only 25% of the donations it received.

The public backlash has been disastrous for the RCSC, but other charity organizations too are having to work hard to build credibility with a public that is eager to help but skeptical about how funds are being used. Raising money on the streets of Chengdu, Yuan says he faces intense scrutiny from those he approaches for donations. “Some of them even accused us of being cheats, but most of them, after we explained what we did and who we are, chose to trust us,” he says.

On Sunday the RCSC’s executive vice president, Zhao Baige, addressed the crisis of confidence in the organization. “If in two to three years we can’t turn the image of the ‘black cross’ into a ‘Red Cross,’ I will resign,” she said. In a sign that public sentiment may be improving, the organization also said it now accounted for almost half of all donations to the quake-relief effort. As the RCSC is painfully discovering, trust is one of the most valuable endowments of all.

— With reporting by Yue Wang / Hong Kong

MORE: Amid China’s Economic Boom, Philanthropy Lags

2 comments
AussieLouis
AussieLouis

Now Time has a paid ant-Chinese troll/reporter named Yue Wang in Hong Kong! Or was the article edited to provide a distinctly ant-Chinese slant? After reading this once respected magazine for 30 years or more, it appears to be sabotaging its own credibility by the day with half-truths and slanted commentary. It's a pity!

Perhaps, getting rid of that plagiarizing Zakaria maybe a start to restoring some respectability! Anti-China articles would soon stop selling if fair comment is no longer something which Time is capable of! 

Pat_Fuller
Pat_Fuller

This article fails to mention that, while donations may have got off to a slow start, RCSC had, as of May 1 collected more than 666 million CNY (108 million USD) in cash and in-kind donations.

The comment attributed to Bei Cun conveys a misunderstanding of the role of the International Federation of Red Cross and Red Crescent Societies (IFRC). The IFRC, of which RCSC is an important member, is an international membership organisation. It serves as the secretariat for all 187 National Red Cross and Red Crescent Societies worldwide. It should be made clear that it does not "operate" these National Societies; rather, it gives them technical and many other kinds of support and provides a channel for international assistance whenever required. This is no less the case for RCSC than for any other National Society and the recent earthquake in Sichuan is a good example, where the IFRC released emergency funds and is providing technical support through its personnel on the ground. The analogy given is a false and misleading one. 

It is completely inaccurate to say that RCSC has come under ever tighter government control in recent years. While it is true that many but not all of its staff are civil servants, since the mid-1990’s, the RCSC’s relationship with the government has actually evolved from one in which it formed part of  the Health Ministry structure, to one in which it enjoys a large and growing measure of operational independence.