It is generally believed that it is extremely difficult to engage large numbers of people in giving to a community foundation, especially when the concept is unknown; that it is even more difficult to persuade people to support advocacy; and that the growth of internet giving tends to be slow.
Won Soon Park, founder of the Beautiful Foundation in Korea, has confounded all these beliefs. Founded in 2000 as the first and only community foundation in the country, the Beautiful Foundation now has 26,000 supporters, with many supporting advocacy causes and 90 per cent donating via the internet, as Caroline Hartnell found out.
Creating beautiful minds
Why beautiful? This is often the first thing people ask about the Beautiful Foundation. Won Soon Park traces its origins back to 1992, when he was studying at Harvard. ‘My attention was drawn to a column in the university newspaper by an American writer, Dorothy Parker. In her column she asked, “Do you know what the most beautiful English words in the world are? Check Enclosed.” This means that the money is sent with good will. What is beautiful is not the words but the good will.
‘This was at the forefront of my mind as I built up the Beautiful Foundation. The Beautiful Foundation works to encourage people to spend money in the most beautiful way in the world, through sharing. Foreigners sometimes ask me if the Foundation was established by a cosmetics company. But the Beautiful Foundation is not a cosmetic to make people’s faces beautiful but an effort to make their minds beautiful.’
Origins of the Foundation
The Beautiful Foundation was established in 2000, but the idea was born in 1991 when Won Soon Park spent a year in London studying at the London School of Economics. While there he was ‘shocked and surprised’ to learn that over 70 per cent of British citizens give to charity. He began doing research on non-profit legal systems, looking at issues such as tax exemptions for donations and legal personality for foundations – subjects he continued to study when he moved to the US to Harvard Law School the following year.
But all this research was not to bear fruit for several years. From 1994 to 2000, Park dedicated himself to the advocacy movement as Secretary General of the People’s Solidarity for Participatory Democracy (PSPD), the advocacy organization he co-founded in 1994.
In 1999 an Eisenhower Fellowship gave him the chance to travel for two months in the US. Among other organizations, he visited the Council on Foundations in Washington DC, the Make a Wish Foundation in Phoenix, and the Triangle Community Foundation in North Carolina, where he met then-president Shannon St John.
Once back in Korea, he wasted no more time. He began talking to his friends about establishing a community foundation in Korea. ‘It took around two years to mobilize influential people to be members,’ he says, ‘and I also asked my close friends to make donations.’ In 2000 the Beautiful Foundation was finally established. Park did not receive – or seek – any money from abroad to help get started.
This was not Won Soon Park’s first experience of fundraising. Unique among advocacy organizations, PSPD was funded by 15,000 fee-paying individual members. But the challenge he faced at PSPD was far greater. ‘In 1994 I was only 38 and PSPD was heavily criticized for attacking business groups and the government,’ he explains. ‘So fundraising was difficult. But when I started the Beautiful Foundation, I was in my late forties and my friends had been promoted to high positions in government and business. It was much easier to fundraise for a social movement that had no direct relationship with politics or other socially sensitive issues. Also, I was already well known by then.’
Creating a culture of giving
Won Soon Park’s central aim in establishing the Beautiful Foundation was not to raise funds for any particular cause but to build a culture of giving in Korea. Or, rather, to rebuild it. ‘In traditional Korean society,’ he explains, ‘there was a good system of mutual support in addition to family support.’
But the tradition was weakened by the country’s tragic history since the end of the nineteenth century. Colonized by Japan for around 40 years, the Korean peninsula was divided into South and North just after liberation in 1945. Following the Korean War, South Korea was to experience a period of dictatorship that lasted into the 1980s. While the Korean economy thrived during that time, Park relates, ‘the generations forgot the mechanisms and social systems for supporting each other, as the aspiration to be rich grew. So I realized it was high time to create, or recreate, a culture of philanthropy in Korean society.’
Birth of the 1 Per Cent Sharing Campaign
Won Soon Park based the new fundraising campaign around the idea of sharing 1 per cent – of income, property, whatever. ‘The 10 per cent that is asked for by some churches is too much,’ he says, ‘and the 5 per cent asked for by Independent Sector in the US is still too much. But 1 per cent is very symbolic, everybody can join in.’
Just five years later, 26,000 Koreans have become 1 per cent givers, and the number is increasing by 300 to 500 every month. Even more astonishing, around 90 per cent donate via the internet.
A key factor behind this success story is transparency. ‘When we asked people why they didn’t make donations, 70 per cent of non-donors replied that there was no credible institution to donate to. So from the beginning I decided to put all financial information on the website, so everybody can access it whenever they want.’ Donors have their own individual membership number to access their own account, and they can see the history of their donations, where the money is used, how much is left, and so on.
The Beautiful Foundation also makes a point of clearly separating administration expenses and money for grantmaking, with just 5 per cent deducted from all donations going into a separate account for administration costs. This is a very small amount – ‘in the US it’s usually more like 13 per cent or 15 per cent’ – so they also raise funds to cover administrative costs from their older members, ‘who understand our intention to be more transparent and to reduce our administration fees’.
The salaries issue
A decision was also made to pay staff very low salaries – around half to one-third of those paid by other Korean foundations. Park himself earns around US$2,000 per month – a fraction of what someone at his level could be earning. All of this information is disclosed on the website.
Many ordinary citizens do seem to be aware of this. ‘When I take a taxi,’ says Park, ‘one or two drivers out of ten refuse to take a taxi fare from me, because they understand the sacrifices we are making.’
But is a system of low salaries really viable? In the long term, will there be enough people who want to work for so little?
In fact, says Won Soon Park, ‘there is an ongoing dispute between my staff and me on this subject. I’m always saying we should increase salaries for the next generation. Those who started working in the 1980s or early 1990s following the end of the dictatorship are a very dedicated and enlightened generation, really a social treasure in Korean society. But I am afraid that the younger generations are very different. But my staff refuse to go along with me on this.’
And for the moment the staff seem to be right: many young people apply to work at the Beautiful Foundation, low pay notwithstanding. ‘Human beings do not live only on their salaries,’ says Park, ‘there is also fame, honour, and many other values.’
Other sources of income
Around 40 per cent of funds raised come from the 1 Per Cent Sharing Campaign. But, Park adds, there is another type of individual donor, ‘who donates periodically rather than regularly, and gives much more than 1 per cent.’ Altogether, money given by individuals accounts for perhaps 60 per cent of donations.
The other 40 per cent comes from companies or businessmen. ‘Many Korean companies set up a social contribution team,’ Park explains. ‘In the past they often donated money secretly to politicians. In the last ten years, many businessmen and politicians have been punished for this, so the practice has greatly decreased. Companies are now keen to donate to social causes, so it’s a good moment for foundations to fundraise from companies.’
Companies can choose to donate to special projects, such as the annual survey on the attitudes of Koreans to giving, which are all fundraised for separately. Yuhan Kimberley, for example, has promised to cover the cost of the giving surveys for five years. ‘Every event should be covered by separately donated money,’ Park insists.
The Beautiful Stores
The Beautiful Foundation also raises money from social enterprises such as the Beautiful Stores, equivalent to UK charity shops or US thrift stores, a concept previously unknown in Korea – though the money they make is distributed in the local communities rather than going to the parent foundation.
The Beautiful Stores are another spectacular success story. The first store was established just three years ago, and now there are 56 stores across the country. Last year total sales were US$4 million and this year it will be $7 million.
The idea for the Beautiful Stores also came from Won Soon Park’s year living in the UK. ‘I was very impressed by the Oxfam shop on the high street in New Malden, where I lived. I used to drop in to buy various items – clothing, chairs, things like that. It is great for those studying abroad, who often have very little money.’
But when he talked about starting up the first Beautiful Store in Korea, his friends tried to discourage him. ‘“You’re bound to fail,” they said, because Koreans really dislike second-hand items. When parents die, the children burn their clothes. People believe they will inherit bad spirits from the previous owners. So it wasn’t going to be easy.’
Park’s response was to carry out an intensive campaign to counter such ideas, and here he was helped by one of Korea’s national newspapers and a major broadcasting company, which supported the campaign by reporting weekly news from the Beautiful Stores over a period of three years. Clearly, the people of Korea are overcoming their fears of inheriting bad spirits. Today more than 170 full-time staff and 4,000 volunteers work in the country’s 56 Beautiful Stores.
Where does the money go?
As already mentioned, when he started fundraising, Won Soon Park did not emphasize the importance of giving to particular causes. ‘From the beginning I emphasized the importance of philanthropy in society.’ But of course he had to say something about how the money would be used. Naturally, social welfare causes were on the agenda. PSPD had been successful in introducing the idea of a social safety net for the first time after the IMF currency crisis, so the government had the first responsibility for social welfare. ‘But the government couldn’t do everything, so its efforts had to be complemented by citizens’ foundations.’
But Park also emphasizes the importance of advocacy in the public interest. ‘This is not so attractive for Koreans,’ he admits, ‘but it is universal in other countries.’ The solution was to allow donors to decide where their money goes. Most choose to support charity or social welfare, but some do choose to support public interest advocacy.
Overall, the Beautiful Foundation has around 78 funds. Many larger individual donors and companies establish their own funds – one cosmetics company has a $10 million fund to support business start-ups by single mothers – and 1 per cent donors can allocate their money to a particular fund or give without designating one. ‘In that case,’ says Park, ‘they are asking us to decide, and we use the money for the public interest funds. But we divide it in two. Half of each donation is used for public interest grantmaking or supporting NGOs or activists and the other half goes into a permanent endowment fund.’
The Making One Into Ten Fund
Persuading the general public to support advocacy is never easy, so how does the Beautiful Foundation persuade people to donate to their public interest funds? The main strategy is convincing people that supporting advocacy is the most effective way of using their money. ‘Supporting people who are trying to improve, to level up our society, is the most efficient way to make our society more beautiful, advanced, and democratic.’ The public interest endowment fund is actually called the Making One Into Ten Fund, so even the name of the fund conveys the message.
People naturally ask what the name means, and ‘then we explain why it is so important to support grassroots organizations’. But 1 per cent donors are ordinary citizens, Park reminds us, so they usually want to donate to NGOs that do social welfare work or to the government.
Other foundations in Korea
Are there other foundations making grants to social welfare causes? Apparently, grantmaking foundations are very rare in Korea. Most ‘mainstream foundations’ raise funds and deliver social welfare services themselves.
The only grantmaking foundations in Korea when the Beautiful Foundation started were the Korean Community Chest and a number of very traditional scholarship foundations. But things are changing. ‘Nowadays,’ says Park, ‘following the Beautiful Foundation model, there are a few other new foundations – a women’s foundation, foundations for the environment and so on.’ Of these, the women’s foundation is solely a grantmaking organization, and the foundation for the environment carries out its own activities as well as making grants to environmental groups.
The secret of success?
I ask why it has all worked so well: ‘You created all this from nothing, and you’ve been very successful very quickly. Was it just that the moment was right? It was 13 years after the end of the dictatorship, and the NGO sector had grown. There was a big gap and you saw it …’
‘I don’t know!’ he says. ‘But as I mentioned, credibility is the first element in our success story.’
But, characteristically modest, Won Soon Park is not really willing to admit that this is a success story, ‘because we should go far beyond this stage’. Five years may be a short time, ‘but Korea is a very rapidly changing society’, he points out.
And their campaign has been well supported by the mass media. A handful of daily newspapers and MBC, Korea’s second biggest broadcasting company, have supported the Beautiful Foundation from the beginning. As we have seen, the Beautiful Stores have also been well supported. ‘The competition among mass media is so fierce that even private mass media companies are very interested in public cause campaigns,’ Park explains, ‘and they really want to include credible organizations like the Beautiful Foundation as their partners.’
A national community foundation?
The Beautiful Foundation calls itself a national community foundation. What do they mean by that?
‘I think the Beautiful Foundation has the main characteristics of community foundations in the US in the sense that we fundraise from the general public and we are establishing an endowment. But Korea is a very centralized country, so it is not easy to establish regional community foundations. But I still think this is important, so next year I will try to establish a taskforce to incubate a community foundation in each region – providing some staff training, seed money, and so on.’
But Won Soon Park is emphatic that these will be completely separate, independent organizations and not branches of the Beautiful Foundation. ‘The Beautiful Foundation is not for itself, it’s for society. People often suggest that we establish local chapters or branches of the Foundation, but I always reject the idea because some day they should establish their own local community foundation.’
Park readily accepts that this will mean the Beautiful Foundation itself losing donors. ‘If an area establishes its own community foundation, I will ask the donors living in that area to donate to the community foundation.’
Beautiful Foundations in the US
Asked if there is anything else he’d like to add, Won Soon Park mentions two new organizations in the US. ‘When I was at Stanford last year I made some contact with Korean Americans living in northern California about establishing the Beautiful Foundation Northern California. This happened in June, before my departure. The Beautiful Foundation New York will begin operations next March.’
But the purpose of these new organizations is not to raise funds in the US for the Beautiful Foundation. ‘The Korean Americans who left in the 1950s and 1960s (there are around 2 million in the US altogether) are very conservative. They have retained their ideals from when they were living in Korea, so they are not accustomed to philanthropy, even though they live in the US. So I think it’s a matter of training them to make donations for social causes. The money can be used not only for the Korean community, but also for other communities, ethnic communities for example, in the US or outside.’
But not for Korea? Park is emphatic. ‘We don’t want Korean Americans sending money to Korea, because the Beautiful Foundation can fundraise. Instead they can support other ethnic groups, or Koreans living in Russia or Central Asia who are suffering, things like that.’
He ends the interview by referring to a Korean poet who was sentenced to death, who wrote a poem about dreaming. ‘Dreaming alone cannot come true, the poem says, but dreaming together will come true some day.’
1 Eisenhower Fellowships offer emerging leaders from around the globe a chance to enhance their professional capabilities, broaden their contacts and deepen their perspectives through two months’ travel throughout the US to meet with relevant leaders in business, government, NGO sector, journalism and academia.