A savvy generation of young Asian tycoons is realising the benefits of philanthropic foundations in building communities and lasting family legacies, writes Tara Loader Wilkinson
A savvy generation of young Asian tycoons is realising the benefits of philanthropic foundations
he history of philanthropy in Asia spans millenniums, but most Asian private family foundations have only been around for two or three generations, if that. Take, for example, Hong Kong’s Li Ka Shing Foundation, set up by the tycoon 35 years ago with an education and healthcare focus, or Singapore’s Lien Foundation, established by businessman Lien Ying Chow in the same year, 1980, to help children and the elderly. Hong Kong’s Robert HN Ho Family Foundation was set up just 10 years ago to promote Chinese culture and Buddhist philosophy.
Compared to the situation in Europe and the US, the charitable foundation sector in Asia is in its infancy. There are more than 100,000 private foundations in the US, according to the National Centre for Charitable Statistics. Mainland China has just 2,600, according to the Ministry of Civil Affairs, while in Hong Kong, although no one knows the exact number, experts estimate it’s around 1,500.
It’s not that well-off Asians are stingy. Wealth is still a relatively new phenomenon in the region, where an estimated 70 per cent of high-net-worth individuals are firstgeneration entrepreneurs. Foundations are usually created when wealth is passed from one generation to the next, to help build a lasting family legacy, or when a company is sold or listed.
“The motivation for setting up a foundation lies not just in giving to charity,” says Steven Seow, head of wealth management at Mercer in Singapore. “For families, it is a way of building bonds between older and younger members, and allowing for emotional values, as well as financial assets, to be passed down.” Laurence Lien, who in 2002 took the role of chairman of the board of his grandfather’s foundation, says, “My grandparents invited me to the role with the task of growing its grant-making programmes. It’s a role I was happy to take: the foundation has grown extremely well and carved out a niche… in Singapore and Asia.”
As Asia moves into its largest intergenerational transfer of assets in history, families are beginning to see the value of hiring professionals to execute their philanthropic objectives, says Seow. The result is a more sophisticated method of philanthropy, akin to investment management as opposed to the old-fashioned way of writing blank cheques. “In the past, Asian families tended to make simple donations,” he says. “But within the last three to five years, we have seen a trend of families wanting to