Hong Kong textile tycoon’s daughter talks about wealth, succession, philanthropy and the art of business
For three generations, members of the Chao family have been trailblazers in society.
Chao Kuang-piu became a textile tycoon and was the founder of Dragonair, which opened up new frontiers in Hong Kong’s aviation industry.
His son, Ronald Chao, is well-known for making new yarn out of silk waste. He also established the Bai Xian Education Foundation (BXEF), which weaves together a network of student exchange programs across Asia.
Then there is Ronald’s daughter. Ronna Chao not only runs the family business but also harnesses the power of technology in recycling textile waste. She also takes an active role in the family’s philanthropic work.
Ronna Chao talked to Asia Times in her Cheung Sha Wan office and shared her thoughts and stories on philanthropy and the family business.
As an initiative of the Bai Xian Education Foundation, the Bai Xian Asia Institute is a charitable educational institution with a vision to foster Asia’s future leaders. Under the Asian Future Leaders Scholarship Programme, it works with six universities and provides up to 100 scholarships to fund Asian students to further their studies in East Asian countries.
Ronna believes in the need to give talented students more opportunities to broaden their horizons. To this end, the scholarship helps students to study in East Asia and promotes exchanges between young people.
“Some Chinese and Korean students, due to family background and history, hold prejudices against Japan. There was a case where a student wanted to study in Japan, but he was met with opposition from members of his family, as they feared for his safety while studying there. Yet, the student was determined to study in Japan, so he applied for and got a scholarship to fulfill his wish. In Japan, he made some good friends. When he returned home, he shared his first-hand experience with his family and changed their views. The family eventually flew to Japan and visited him.”
Ronna also reflected on her own studies abroad. She was 14 when she left Hong Kong for the United States. Although she had traveled with her family when she was younger, she still felt uneasy initially when studying in a boarding school.
“I was in an unfamiliar place, and there were no family members around me. On the other hand, I had studied in the same school for 10 years, and I didn’t need to make an effort to make new friends. When all these safety nets were gone and I was psychologically under-prepared, there were times my self-esteem level was on the low side even though no classmates rejected me,” she recalled.
Ronna said she studied international relations at Brown University in the United States, then spent a year at Keio University to further her studies.
“I drank Coke and ate at McDonald’s, but I had never heard of their topics of conversation. I also had no clue about their way of dressing and the sports they were playing. But, as soon as you make a group of good friends, that makes a big difference. During holidays, I went to my classmates’ house gatherings, and that gave me the chance to understand the actual life of America’s white middle-class.
“The value of living abroad is to help students challenge themselves and eradicate prejudices.”
After finishing her studies in the US, Ronna took a job at an investment bank. Things considered unimaginable these days were common then, she said.
“Females were required to wear a skirt when going to work. It now sounds ludicrous, but that was the case back then, and this was not limited to investment banks,” she said. “In those days, there weren’t many females in the upper echelon of management. It wasn’t necessarily that females were prevented from job promotion but rather the general expectation was that females should give birth to children after 30 years of age and take care of their kids and husbands.
“Many outstanding female bankers reached the rank of vice-president, but they quit after giving birth. And today, when you see females can become partners in investment banks and that they’re allowed to wear trousers to work, you realize society is progressing.”
Today, Ronna wears multiple hats – she is the chair of Novetex Textiles Ltd and CEO of Novel Investment Partners Ltd. Back in 2010, the decision to take over Novetex stemmed from love for her family, rather a career plan.
“Nowadays, textiles is not an easy business,” she said. “I decided to carry on due to my feelings toward my family. Family members once thought about selling the company, but I felt I owed my brother – when I thought about how much he had devoted to the business and turned it around from red to black when he was alive.”
Ronna’s uncle asked her to join the company, so she decided to explore how the group could fill unmet demands in the market.
The garment-to-garment recycling system developed jointly by Novetex and the Hong Kong Research Institute of Textiles and Apparel Ltd utilizes cutting-edge technology to turn textile waste into raw materials, and the process is waterless and solvent-free. She called it the ‘Billie System’ after her grandfather.
“This system can lower costs,” she said. “From an accounting perspective, textile waste is valueless, but in reality, it has a value as it can be used to make a sweater. Thus the cost of raw materials can be pushed down, and it can reach zero. If a sweater is made with recycled yarn, the overall cost can be reduced by 30%.”
Early financial education
Clogs to clogs in three generations is a well-known idiom, and she thinks it is important to teach financial management from an early age. Her parents influenced her heavily in this regard – they said the basic necessities and the needs for school would be provided, but she should not expect there would be something in the family for her to inherit.
“The guys in the family all knew how to knit a sweater – my brothers knew the basic skills. My father brought the yarn back from the office and let them do the knitting,” she recalled.
As a young girl, Ronna was a ‘fashion designer’ for her Barbie dolls. “The clothes I made for my Barbies were assembled with primitive craftsmanship. I used paper and cloth to create cardboard shapes and clothes, respectively. Sometimes, my mother and her friends would teach me,” she said.
Now a mother, Ronna said she teaches her children the virtues of financial management. In the early days when her children were young, she did not give them all lai see, or red packet money. When she took her children to a toy shop, she cautioned them not to waste money.
“If you can’t find the toy you like, then don’t buy for the sake of buying something,” she said. “My daughter was only six or seven, and she was super excited in this big Toys ‛R’ Us store. When I asked her, ‘Did you see what you wanted?’ she replied no. So, I told her not to buy anything.”
Ronna’s three children are now teenagers, in a rebellious phase of life.
When asked how she gets along with them, she said: “Don’t delve into the rights and wrongs, and avoid insisting on your own views. You’ve got to consider their perspectives as well on all matters. And this thinking also aligns with the philosophy of BXEF.”
Ronna said her father once taught her something valuable: “Communication is important. You need to think how the other side thinks. Even having a quarrel is a form of communication. During the process, you realize the other’s points of view may stem from his or her experience and knowledge. Don’t always insist on ‘I am right and you are wrong’.”
She said she enjoyed a good relationship with her parents and talked about everything with her mom. On the other hand, she has learned how to respect her children. Even when her children were little, she did not check the messages on their phones.
The secret to staying young
A few months ago, Ronna appeared on the cover of Hong Kong Tatler. In the photo, she looked energetic – and she looked equally radiant during our interview. As the granddaughter of wool magnate Chao Kuang-piu, and with her experience at Tommy Hilfiger, Ronna knows the ins and outs of garment costing.
Asked for dressing tips, she said the first and foremost thing was to wear comfortable clothes and to create your own style. “I shop for clothes in Cheung Sha Wan Plaza because I can find special styles there. This way, I won’t be wearing the same style as other people. It takes time to find, and clothes there are inexpensive.”
As for staying youthful, the key was to spend time with people of different ages. She said it was an honor for her to work at BXEF, so she can showcase her youthful side in public.
Asked what philanthropists can do for young people, Ronna said everyone can do something – the most important thing is to give young people opportunities to undergo experiential learning. The situation in Hong Kong is complicated, she said, and not easy to explain in a few words. But, in many parts of the world, the lives of young people change dramatically with university education.