Building a Spirit of Generosity

China's biggest donor has many admirers — and critics

By Ian Wilhelm

On a Sunday night here two years ago, the billionaire Li Ka-shing lay awake in his bed, contemplating the Chinese spirit of generosity.

While already

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a well-known philanthropist, Mr. Li spent that restless night trying to figure out how to make a grand declaration of his commitment to charity, one that would have meaning to rich and poor alike.

The following evening Mr. Li shocked his family at the dinner table. "I couldn't sleep last night," he said. "I have to tell you that I have a third son."

He greeted their surprised looks with a wry smile. "This brother will never give you any trouble; he will only bring you good things," he said. "But you will have to be as dedicated to the brother as I am."

He then explained, with a sigh of relief from his relatives, that the newfound offspring was not some lost child, but the charitable foundation he had established in 1980.

Calling the fund his "third son" was more than a sign of endearment though. It indicated that Mr. Li intends to split his massive wealth — roughly $23-billion, according to Forbes magazine — between his two sons and charity. In China, where parents are expected to pass their riches on to their children, the designation of his foundation as a bloodline obligation brought Mr. Li — and philanthropy — a swell of public attention.

Often called Hong Kong's most powerful man, Mr. Li, 79, is the ninth-wealthiest person in the world, having earned much of his money in real estate and manufacturing plastics, and by most accounts he is also Asia's most generous philanthropist.

Since 1980, he has donated more than $1-billion to establish a university in rural China, set up health-research centers around the globe, and set up medical clinics for thousands of poor Chinese people and victims of cancer.

"He is one of our first philanthropists in a big way," says Darwin Chen, vice chair of the Asia Pacific Philanthropy Consortium, "and other tycoons have followed him."

Yet not everyone considers Mr. Li a role model.

He is a frequent target for those critical of Hong Kong's wealthy elite, and his charitable activities are often perceived as a veiled way to deepen his business relationships in mainland China and elsewhere.

What's more, a gift from Mr. Li to the University of Hong Kong in 2005 triggered protests after the institution renamed its prestigious medical school after him. While the public outrage has largely subsided, the move remains a sore point. In May, several angry alumni held a "memorial service" to mark the second anniversary of the demise of the old name.

While renaming a building or institution after a major donor is commonplace in the United States, the practice is relatively new in China.

"It's not agreeable to the local people," says Choi Suk Mui, a graduate of the medical school who organized the demonstration. "We don't make the change for the Queen [of England] even."

Often Called 'Superman'

While relatively obscure in America, Mr. Li is a household name here. His company's giant cargo cranes dominate the port, his buildings tower over Hong Kong's Victoria Harbor, and a statue of him greets visitors to the local Madame Tussauds Wax Museum.

Born in Chaozhou, China, Mr. Li fled in 1940 to Hong Kong with his family after the Japanese invasion.

Shortly afterward, his father died of tuberculosis, and at the age of 12 Mr. Li went to work for a watch-strap manufacturer.

From there, he built a stunning business empire, earning him the nickname Chiu Yan — "Superman."

Mr. Li took over a plastics factory in 1950, made big bets in real estate during the 60s, and eventually branched out into biotechnology, telecommunications, and other ventures.

Today he leads the Cheung Kong Group, which operates in 55 countries and has 250,000 employees. While he has a full-time job overseeing the corporation, Mr. Li says he spends about one-third of his time on charity efforts.

In an interview with The Chronicle in his corner office on the top floor of the Cheung Kong Center, one of Hong Kong's tallest buildings, Mr. Li, wearing a black suit and horn-rimmed glasses, says his passion for humanitarian causes comes from his refugee-like struggle in childhood.

"I had lived through difficult times when I was young," he says, describing his youth as being "devastated by despair, loneliness, and helplessness."

The experience fueled his determination to succeed in business and set the course for his philanthropy.

Since World War II forced him to quit school at age 10, he has focused on giving Chinese youth the education he was denied. The crown jewel of these efforts is Shantou University.

In 1980, the tycoon transformed 30 acres of farmland, located near his hometown on the southeast coast of China, into a university campus that is a veritable oasis compared with Shantou City's traffic-clogged and smoggy downtown.

Palm trees line the roads, and students walk along man-made lakes and attend classes in magnolia-white buildings.

Mr. Li serves as honorary chairman of Shantou's Board of Directors and provides 70 percent of the school's annual budget, even though it is a public university. Since its inception, he has given the institution more than $300-million.

The Chinese Ministry of Education and the Communist Party, which controls the government, at times are wary of the rich capitalist's intentions. Yet in recent years, the government has granted him a greater say in the university's operations, and under the guidance of Solina Chau, Mr. Li's philanthropy adviser and his foundation's chief operating officer, he has molded it into a Western-like institution.

In 2001, Mr. Li persuaded Julia Hsiao, an assistant chancellor of international relations at the University of California at Berkeley, to become a vice president of Shantou, the first time an American has held such a lofty position at a Chinese university.

Ms. Hsiao says she was wary of leaving her family and friends behind, but after meeting Mr. Li the day after the September 11, 2001, terrorist attacks, which rocked the world's financial markets, she changed her mind.

"All he could talk about was his love for Shantou University even though the stock market was falling and his net worth was probably plummeting," she says. "My thought was, 'Wow. This can't be true.'"

Offering Choices

With Mr. Li's staunch support — the billionaire even sent her packages of cheese, a favorite treat she couldn't get in Shantou — Ms. Hsiao made radical changes. She hired more foreign professors, gave students more freedom to choose their courses, offered opportunities to study abroad, and even unbolted chairs from classroom floors.

"We make the students form circles, we make them work in groups or teams. It's new to them. Nobody ever teaches like that in China," says Ms. Hsiao, who returned to her job at Berkeley in 2004 but continues to serve on Shantou's board.

Ms. Hsiao's efforts have helped the school earn a worldwide reputation.

According to Rep. Diane E. Watson, a California Democrat who visited the campus in April as part of a Congressional delegation, the school is helping Chinese students break the bonds of the socialist mind-set. "It supports free thinking," she says.

While there may be a slightly subversive political bent to the school, it also seeks to benefit China by preparing students for the global economy.

For instance, a top goal of Mr. Li's has been for Shantou's 8,000 students to learn English, since it has became the lingua franca of commerce. To assist with this effort, the institution added to the student center an English Lounge where students are forbidden to speak Chinese.

One rainy Tuesday afternoon, Jonathan Huang, a 20-year-old business major, says the lounge has helped him to learn the language for a possible career as an accountant.

"English will be a very common tool," he says in a crisp, formal manner. Next to him is a stack of board games, like Monopoly and Scrabble, that the students play in the brightly colored room.

As a freshman, Mr. Huang says he was shy and only wanted to talk in Chinese. But when he volunteered to work in the lounge, keeping it tidy and organizing game nights, he came out of his shell and his English improved. "The learning environment is quite good," he says.

As for Mr. Li, Mr. Huang says the students have great respect for him — he is "one of the greatest entrepreneurs in the world" — and shower him with flowers when he makes his annual visit to the campus to speak at graduation.

Four Entities

While Shantou is his main project, Mr. Li has supported a myriad of other efforts. Through the Li Ka Shing Foundation and his three other charitable funds, he has set up an oncology program at the University of Cambridge, research efforts to combat avian flu, and a program that provides tens of thousand of prosthetic limbs to impoverished Chinese amputees.

But as with Shantou University, it is not just his money that makes him a notable philanthropist, but his influence with Chinese authorities.

For example, Mr. Li set up 20 terminal-care units at hospitals nationwide to provide free pain-relief medications, mental-health counseling, and other care for some of the 1.4 million cancer victims in China.

According to Frieda Law, an Australian pediatrician who oversees Mr. Li's medical projects, the Hong Kong businessman persuaded Beijing authorities to allow six of the facilities to pay for morphine and other drugs tax free, reducing the cost by 38 percent; the successful lobbying allowed the hospices to distribute more pain-alleviation medicines to dying patients, Dr. Law says.

Nonprofit officials say Mr. Li's support for promoting palliative care, a taboo subject in China, is emblematic of his efforts to help social needs the government has historically avoided.

"He has the vision to identify missing niches," says Herman To, a director of Habitat for Humanity China, in Hong Kong.

But at the University of Hong Kong, a few alumni wish his generosity had passed their alma mater by.

Two years ago, Mr. Li gave the university $128-million. Since the donation was the largest in the institution's history, the school honored Mr. Li by renaming its flagship, the 120-year-old medical college, the Li Ka Shing Faculty of Medicine.

The move drew howls of protest. Public demonstrations were held, ads complaining about the move appeared in newspapers, and upset alumni collected signatures of people opposed to the change.

While renaming an institution after a donor is common place in philanthropy, protestors say that it was inappropriate for such a venerable entity as the medical college.

"This faculty is not just a medical school, but the foundation and essence of our medical history. It carries a lot of memories and affection among all old graduates," says Dr. Choi, pointing out that Sun Yat-sen, considered the founder of modern China, graduated from the college. "It will be a big disgrace and insult to us if we trade it off just for money."

Dr. Choi admits that she is unlikely to get the original name restored, but she says about 300 other alumni continue to voice their anger with the University of Hong Kong. Aside from the occasional campus protest, they have produced a book, Thy Name Is Priceless, that details their concerns.

Cheng Kai-ming, senior adviser to the vice chancellor of the University of Hong Kong, says despite Dr. Choi and her colleagues, the controversy has mostly died down.

"At first, a lot of people felt uneasy — why should such a fine faculty be renamed?" he says. But concerns eased once people understood that the "money can enable a quantum leap in research capacity."

For his part, Mr. Li never expected his generosity to be attacked.

In a public letter to the university's vice chancellor at the time the dispute erupted, Mr. Li wrote the "rude remarks which have been thrown at the university have deeply hurt me." The letter also says that the philanthropist has declined to have his name "associated with over 80 percent" of the charitable efforts he has supported.

Name Dispute

While the disgruntled alumni insist there was a secret deal between the university and the donor to rename the school as a condition of the gift, Mr. Li tells The Chronicle there were no strings attached. "These people just wanted to use my name to make themselves more high profile," he says.

But this is not the first time Mr. Li has been accused of being less than public about his philanthropy and the operations of his charitable fund.

Mr. Li declines to say how much in assets the Li Ka Shing Foundation has — Hong Kong law does not require foundations to disclose their financial information — and some nonprofit officials have raised questions about how Mr. Li is overseeing those assets.

In November, the foundation announced it was acquiring 12 percent of the telecommunications company Pacific Century CyberWorks. The move was widely seen as an attempt to help Mr. Li's son, Richard, who is chairman of the corporation, known as PCCW.

Eventually the deal fell through, but suspicions lingered that the Li fund was being used for noncharitable purposes, and as the most prominent philanthropist in Asia, Mr. Li had set a bad example.

While there is no evidence that Mr. Li intended to misuse the foundation, the incident has damaged the reputation of his philanthropy, says a Hong Kong fund raiser who declined to be identified, citing the sensitive nature of the topic. "The real loss is to at least the appearance that the foundation — and philanthropy in general — is transparent and on the up and up," he says.

Mr. Li says the PCCW deal was purely an investment opportunity to earn money for charity and that "every penny in my foundation will be donated toward society."

When asked whether his philanthropy has ever helped his business relationships, Mr. Li laughs and tells a story.

In 1976, Mr. Li asked a friend who worked for the Chinese government how he could help needy people in Shantou suffering from the aftereffects of the Cultural Revolution. The Chinese official told the billionaire he could assist several different projects, including by making a relatively small gift to refurbish an opera house — a contribution that would have the added bonus of pleasing a top-ranking leader in Red China.

Mr. Li's response?

"The small one I said, 'No, I don't want it,'" Mr. Li says, smiling. "He said, 'You are a funny man.'"

Mr. Li says he wanted to help everyday Chinese people, not hand out bribes.

"I wanted to share this story with you to let you know that this has been my character since the beginning," he says, "and I work by the principle that the projects I support must be to serve the people."

He says his approach has remained the same for 30 years.

"My principle has not changed," he says. "I am not looking for anything in return."