Charitable giving from rich individuals could be increased by £4bn a year if there was more public discussion of philanthropy and they received better advice from experts, according to a report from the think tank NPC.
The report, called Giving More and Better, funded by the Hazelhurst Trust, says people in the UK with wealth exceeding £1m give a total of approximately £1.3bn a year to charity, but this could increase to £5.2bn a year if donors were to adopt "best practice levels of giving".
The report says that "effective philanthropy" – which has a greater focus on outcomes, strategy and collaboration – is becoming recognised as good practice in the philanthropy sector and recognises that the nature of philanthropy is evolving.
"There may be a generational shift taking place," the report says. "Many new philanthropists are starting at a younger age and are self-made. These individuals tend to be more enterprising, risk-taking and interested in impact.
"Nevertheless, the philanthropy sector can do more to help philanthropists focus on being more effective so they can have a bigger impact."
The report says that, despite this, the advice philanthropists are receiving needs substantial improvement.
"Fundraisers, wealth advisers and lawyers are not always knowledgeable enough to explain the tax implications of giving or help a philanthropist plan his/her giving," it says.
"Lawyers and wealth advisers can also sometimes be reluctant to recommend charitable organisations to their clients, including those organisations that help people develop their giving, perhaps fearing responsibility for the advice."
Other proposals in the report include better coordination between philanthropy organisations, investment in advisers’ skills and relationships and greater investment in the philanthropy sector by funders, including the government.
The report also proposes greater public discussion about how to increase donations from the wealthy and more research on how to measure the impact of initiatives to increase charitable giving.
Angela Kail, head of the funder team at NPC and co-author of the report, said: "Philanthropy just doesn’t achieve enough at the moment. For all the generosity of some individuals, philanthropy in the UK is too small and too complex, and is nowhere close to meeting the social challenges of our time.
"It doesn’t need to be like this. Some of our biggest givers can also wield influence over their friends and colleagues to do more to address social problems. This is our attempt to establish new norms in how the richest donate to good causes.
"It’s an ambitious project, but philanthropy should be ambitious."