Billionaire co-founder of the Chinese company, Alibaba, recently made what was, for some, a startling announcement. Ahead of the highly anticipated IPO, co-founder Jack Ma, and current CEO Joe Tsai set up two charitable trusts. Some are calling the move a “new era” in Chinese philanthropy. While the trusts will only account for about 2% of the company, the move may signal a new status quo in Chinese business strategy.
According to CNN, the philanthropic effort will include environmental, medical, educational, and cultural investments in China. Ronn Torossian 5WPR CEO, said this move is not only smart public relations, it is a PR gauntlet thrown into the Chinese marketplace. Other companies are sure to watch the results of this move, take notes, and seek to emulate what works.
Of course, most Chinese tech companies have been watching Alibaba for years. The company was founded fifteen years ago, and now accounts for about 80% of the online shopping industry in China. In recent years, the company has also expanded into online payment services, and investing in start-ups. Now they are leading the way in public, corporate philanthropy.
Torossian said that Ma is on the right track with his charity work, releasing a forceful statement that reads as both a manifesto, and a challenge to his colleagues and competitors. He said, in part, “Concern and complaints cannot change the current situation. We must assume responsibility, and take action to improve the environment that our children will inherit.”
While the establishment of the trust makes Ma one of China’s first billionaires to engage in a major charity endeavor, it also sets him up as the harbinger of a necessary evolution in the Chinese marketplace. As the power brokers of the world’s second largest economy, Ma’s action makes it apparent that he and others are beginning to see and shoulder the social responsibility that comes with that status.