As co-founders, Prof. Wang Zhenyao, the President of the China Global Philanthropy Institute, Mr. Li Feng, President of Shenzhen CSN Financial Services Co., Ltd and Mr. Liu Borong, the head of the Finance Department of the Beijing Zhong Lun Law Firm, borrowed from the overseas mature DAF operation model and jointly proposed to establish a charity in China that offers DAF charitable accounts. The China Global Philanthropy Institute, the Beijing Zhong Lun Charity Foundation and Shenzhen CSN Financial Services Co., Ltd jointly established the China DAF (Donor Advised Fund) Charity on June 21st, 2018. The registration was completed in the Shenzhen Civil Affairs Bureau.
As the first charity in China that has offered its donors advised fund charitable accounts, with the strategic goal of ‘Enduring Philanthropy, Unfading Legacy’, the mission of ‘Helping donors with their charitable legacies’, the vision of ‘Connecting donors with lasting impact’, the values of ‘Accountability, Professionalism, Innovation, and Sharing’, and the main focus on ‘Serving donors’ with the ‘spirit of stewardship’, the Charity strives to make charitable contribution more convenient and instrumental for donors. It also strives to turn charitable contribution into an important part of donors’ overall asset allocation strategies on the basis of sound advice on the management and intergenerational transmission of family wealth, and long-term development of family enterprises, via the charitable accounts as vehicles that empowered donors with advisory privileges. The Charity serves the donors by providing services related to the contribution, investment, and granting of charitable assets in an independent, transparent, and convenient manner, so as to assist professionals in building up charitable service relationships with clients and empowering clients through charitable affairs, advocate the building of accountability through professionalism, and encourage people, especially high-net-worth individuals, to join charitable causes. Through the establishment of the DAF-Giving Charitable Training Projects with its partners, the Charity also attempts to lead the effort to popularize philanthropy and inspire positive changes in the foundation sector in China.
The Charity utilizes the operating model of well-developed Donor Advised Funds (DAFs) that is commonly used by international charities. The translation of the term Donor Advised Fund (DAF) in Chinese is “捐赠者建议基金”, which is a type of charitable fund that not only provides donors with exclusive charitable accounts and tax-planning advantages, but also allows donors to retain advisory privileges over the investment and granting of the contributed assets. In the acclimatization of DAF to Chinese culture, in order to exactly summarizes the meaning of DAF and its business model, the term Donor Advised Fund (DAF) may also be translated into “捐赠者服务基金”, reflecting its unique feature of providing a full range of services for donors. In the exploration stage of DAF China’s localization practice, in order to form an industry consensus and stay in consistent with the statement of DAF industry practice, the term “捐赠者建议基金” will be used in the Chinese versions of the Contribution Prospectus and other documents regarding the operation and management of the Charity, while the term DAF (Donor Advised Fund) will be retained in English communications.
DAFs attach great importance to donors’ advisory rights, which are exercised by charitable account advisors, in regard to the use of contributed assets. DAFs enjoy advantages such as strategic contributions, mutualization of contribution management, and diversification of investment models, among others. During the investment and granting processes, charitable account advisors can advise on appropriate investment plans and grants to qualified grantees. In accordance with the Charity’s Articles of Organization and internal guidelines, the Charity will fully respect their advice, but reserves the right to make the final decision on investment or granting. The contribution of assets, the accumulation of contributed assets, the specific grant advice, the internal approval of the Charity, and the final transfer of contributed assets constitute a dynamic process designed to achieve the donors’ contribution purpose to its greatest extent. This operating model, based upon international practice and tailored for the Chinese legal framework, is a beneficial attempt to innovate a new operating model for domestic philanthropic foundations.