The UK’s wealthiest 1% donate nearly £8 billion to charitable causes, a new report from the Charities Aid Foundation (CAF) has revealed.
According to CAF’s High Value Giving report, the UK’s high-net-worth individuals give the equivalent of 0.4% of their combined £2 trillion investable assets. In 2023, these donors gave an estimated £7.96 billion.
Meanwhile, the wider UK public donated an estimated £13.9 billion to good causes in the same year, equating to 1.6% of their income.
The report showed that causes supported by the UK’s wealthiest are significantly different to those supported by the rest of the public. The most popular cause for wealthy donors is education, supported by six in 10 high-net-worth individuals. However, only 4% of the rest of the population choose to donate to education, compared to 28% who donate to animal welfare, the UK’s most popular cause. Similarly, while a quarter (26%) of high-net-worth individuals donated to arts and culture, just 3% of the public choose to support this cause.
CAF’s analysis found that if each of the UK’s estimated 536,673 millionaires were to donate 1% of their investable assets, this could mean an extra £12 billion for the charity sector. The total donation from HNWIs would increase to an estimated £19.9 billion.
The charity said that with an estimated £5.5 trillion set to transfer across generations over the next 25 years, advisers can contribute to unlocking philanthropic funds by increasing their knowledge of philanthropy and discussing it with their clients. Previous CAF research found that only 5% of advisers are very confident discussing philanthropy with their clients, yet nearly one in five wealthy people surveyed would choose an adviser who offered support on making charitable donations, rising to 57% of under-35s.
According to CAF’s report, the donors who give the highest proportion of their wealth are, on average, 63 years old, and are more than twice as likely to have inherited their wealth. Women are over-represented in the group of the most generous donors, making up nearly three in 10 (29%), compared to 19% of the high-net-worth population.
Edward Garrett, head of private clients at the Charities Aid Foundation, said: “The UK has a strong history of philanthropy, which has been behind some of our most important innovations and funds crucial charitable services throughout our country. But there is cynicism towards philanthropy in the UK, perhaps more so than other countries.
“There is considerable untapped potential for philanthropy to contribute towards tackling local, national and global challenges. The Government can take steps to renew Britain’s culture of giving to strengthen civil society for the future.
“Wealth advisers also have a critical part to play. They don’t need to be philanthropy experts but should understand the different approaches available to their clients and know where to turn for expertise. As well as helping to win new business, especially with the next generation, it’s also an enjoyable way to build a deeper relationship with clients.”
Main image: marcos-paulo-prado-83JZupwXfhU-unsplash
