(Bloomberg) -- Tencent Holdings Ltd. is doubling the amount of money it's setting aside for social responsibility programs, marking one of the largest philanthropic efforts by China's internet giants as regulatory scrutiny intensifies.
The company on Wednesday announced it will give 50 billion yuan ($7.7 billion) to aid the government's wealth redistribution efforts, adding to an April pledge of 50 billion yuan for a “sustainable social values” program. The new funds will be focused areas like increasing incomes for the poor, improving medical assistance, promoting rural economic efficiency and subsidizing education programs.
Beijing's campaign to rein in the internet sector is entering its 10th month, having expanded from e-commerce and antitrust into areas like data security and online content. The country this week offered an outline for “common prosperity” that includes income regulation and redistribution, a sign that the scrutiny is likely now expanding into the inordinate wealth tech companies have created for founders like Tencent's Pony Ma.
“This new strategy by Tencent is a proactive response to the national initiative,” the firm said in a WeChat statement. “As a Chinese technology company that has grown up in the age of reform and opening up, Tencent is constantly thinking about how to use its own technology and digital capabilities to help society develop, so as to better give back to society.”
China's largest corporation on Wednesday warned investors to brace for more government curbs, saying that regulation over the internet industry has been “quite loose,” considering its size and importance. In a post-earnings call, executives stressed the company's contributions to help small and medium-sized firms grow while emphasizing its efforts to curb gaming addiction among minors, a key point of contention for Xi Jinping's administration.
Read more: Tencent Warns of More China Tech Curbs After Growth Sputters
In recent months, tech billionaires including Pinduoduo Inc.'s Colin Huang, Meituan's Wang Xing and Xiaomi Corp.'s Lei Jun have also donated sizable chunks of their personal fortune to social causes.
©2021 Bloomberg L.P.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
