The richest donate smaller proportion to charity than average working person. Research found British millionaires donating just 1% could boost the sector by £12 billion. The UK’s most popular cause was animal welfare which was more popular than starving children in Africa.
Richest donate smaller proportion to charity than average person
The comparison has been made by dividing the high net worth individuals and average payers by tax brackets. But a small caveat needs to added for those who have become property millionaires, due to the location of their family homes, which does not infer the same amount of disposable income.
The wider UK public donated an estimated £13.9 billion to good causes in the same year, equating to 1.6% of their income. Suggesting they donate more emotionally than their wealthier counterparts.
The Uk has a rich history of philanthropy and CAF said its report also reveals that the UK’s wealthiest people tend to support “significantly different” causes to those supported by the rest of the public.
Emotions play a part in donations
The sum could be raised if each of the UK’s estimated 536,673 millionaires – known as high net worth individuals – were to donate 1% of their investable assets, the Charities Aid Foundation (CAF) said.
Their research suggested this group gave the equivalent of 0.4% of their combined investable assets – worth £2 trillion overall – in 2023. This equated to an estimated £7.96 billion.
History of philanthropy
The UK has a strong history of philanthropy there is cynicism towards philanthropy in the UK, perhaps more so than other countries. but there is considerable untapped potential for philanthropy to contribute towards tackling local, national and global challenges.
Which sectors are most popular for donations
Education was the most popular cause for wealthy donors, supported by six in 10 high-net-worth individuals compared to 4% of the rest of the population.
Arts and culture was supported by just over a quarter (26%) of millionaires who donated, compared to 3% of the general public.
Charitable foundations hoarding assets
UK charitable foundations with collective assets of more than £12bn are giving away only a small fraction to good causes each year, according to a think-tank analysis.
Hundreds of grant-making trusts and foundations (GMTFs), including the Eranda Rothschild and Mikhail Khodorkovsky foundations, were identified in the research by Pro Bono Economics.
The analysis showed that if GMTFs distributed 3 per cent or more of their assets, this would generate at least an additional £300mn a year for good causes.