Giving it all away
Renowned for his philanthropic endeavours, Ronnie Chan also understands the power of 'no', including when it comes to his children, writes Kate Whitehead
Ronnie Chan Chi-chung, chairman of Hang Lung Properties, grew up knowing he would never inherit his father's fortune. He can't recall explicitly being told of the arrangement - it was just something he understood from a very early age. But when it came to his own children, Chan made sure he spelt it out.
"I knew my father was wealthy, but it never, even once, came into my mind that one day my brothers and I would inherit anything. I wanted to make sure my sons understood that," says Chan.
When his eldest son, now in his 30s, was seven and sitting comfortably between him and his wife, Barbara, Chan got his opportunity. He was going through a company report and Barbara was reading a storybook aloud to their son. When she read the word "inheritance" he asked what it meant and Chan explained, then asked him, "What do you think your inheritance will be one day?"
"The kid thought about it, then said 'nothing'. Good kid, smart kid," says Chan. "So they never grew up with the expectation that they would get a penny. If there is no expectation, there is no problem. If they grow up with the expectation and you don't give it to them, then you have a problem."
And dealing with people's hopes and expectations is something he has to deal with on a regular basis. He has been personally successful in his business ventures - although those with Enron pensions weren't as fortunate; Chan was on the audit committee of Enron when it collapsed, wiping out billions of dollars in employee benefits - and over the years he has given a lot of it away.
"A guy in my position, you better know how to say no or you don't survive. A lot of non-government organisations come to Hong Kong, there must be eight to 10 doors they knock on, if you don't know how to say no you are in trouble. I tell people no to their face many times. Just say no - be honest. Cut off all expectation," says Chan.
But he's said yes a lot of times, too, and regularly features in Forbes' annual list of top global philanthropists. The project he says he's most pleased with is the Palace of Established Happiness in the Forbidden City in Beijing. The palace was built by Chinese Emperor Qianlong in 1740 and wrecked by a fire in 1923. Chan founded the China Heritage Fund that financed reconstruction work on the palace.
Closer to home, he drove the fundraising for the new building for the non-profit organisation Asia Society and donated more than US$1.3 million himself. The Asia Society's new premises in Admiralty - integrating four former British military buildings - opened in 2012, but Chan's involvement with the non-profit began in 1990 when it arrived in Hong Kong.
"In simple terms, the Asia Society educates Americans about Asia and Asia about Americans. I identified with the objectives and mission from day one. I was invited to inaugurate it, they asked for some financial help too and that's OK," says Chan, who serves as chairman of the society.
Chan credits the idea for a permanent home in Hong Kong to Jack Wadsworth, former chairman of Morgan Stanley, and Chan invited Wadsworth to join the council of the Hong Kong centre in the 1990s.
"One day, he said 'I think it's time for the Hong Kong centre to have its permanent home'. Everybody bought in, except me, I didn't say anything - I knew what it meant. It meant a lot of work and I knew who it would fall on," says Chan.
For all its reputation as a hardnosed town, Chan says Hongkongers are typically generous, which he believes is attributable to Hong Kong's identity as an immigrant city, with many people climbing up from difficult circumstances.
Such immigrants are usually sympathetic to those who are struggling, he says. On top of that, he's read academic research that says the newly prosperous tend to be generous.
"Hong Kong is basically nouveau riche and, being an immigrant city, most people made their money in the 1960s, '70s and '80s. Now money is still being created as waves of immigrants come. The nouveaux riches show empathy because they remember what life was like before they succeeded," says Chan.
He sees similar philanthropic patterns developing on the mainland, as once impoverished people amass fortunes. The lesson was driven home a few years ago when he was giving a talk in China about the two complexes he'd restored at the Forbidden City in Beijing.
He commented few people on the mainland or in Hong Kong seemed concerned about donating to charitable ventures, especially those related to arts and culture, and was surprised to receive a letter after the talk from a friend in the audience.
"He wrote to me and said, 'Ronnie, I just want to let you know that philanthropy in China is thriving.' And so he went on to tell me what they are doing … The nouveaux riches in China are very generous," says Chan.