Almost half of multimillionaires give away less than 1% of their income every year, according to a new report from Barclays. One reason: the merely rich think that the super rich can have a more direct and immediate impact on charitable causes, so why bother?
The report, which surveyed 400 people with assets of at least £5 million ($6.5 million) outside the US, found that 75% believed charitable giving was the responsibility of those wealthier than themselves. Just over 40% said the amounts they could give would be “insufficient to make a real impact.”
Bill Gates tried to encourage the world’s wealthiest people make major donations with the Giving Pledge—a commitment to give away the majority of their fortunes to charity. The Barclays report suggests that this sort of effort sometimes backfires, leading the very rich to think they can’t have as much of an impact as the mega-rich. “The passing on of responsibility to wealthier people by these multimillionaires is also exacerbated by the high-profile nature of the most celebrated philanthropists making vast commitments to causes,” Barclays writes.
The survey focuses on multimillionaires outside of the US, which leads the world when it comes to both wealth creation and wealth sharing: in 2018, more than $425 billion was raised and donated, worth 2.1% of GDP. In the UK, by contrast, £10 billion was raised and donated, worth just 0.5% of GDP.
Just over half of non-US multimillionaires surveyed by Barclays say it is the responsibility of the state to support charitable causes. In France, a whopping 71% of respondents said this.
Aside from the bizarre psychology by which the very rich feel they cannot make a difference, many say that there are other barriers to giving, like having their own financial obligations to meet (28% of respondents), not having control over how donations are spent (25%), and lacking faith in how charities are run (also 25%).
The report highlights that leaving philanthropy to benevolent billionaires is flawed. If every non-US multimillionaire increased giving to 1% of their income, there would be an additional £800 million in annual global funding for charitable organizations.