Private View Blog: Shared charitable values bring US and UK closer together

US Independence Day is a day of celebration for all US citizens, but it can also be a moment to reflect on the important links between the US and UK.

President Joe Biden’s recent visit to the UK once again shone a spotlight on those ties. He and his UK counterpart Boris Johnson signed a new Atlantic Charter, building on the aspirations set out in the original charter 80 years ago signed by Winston Churchill and Franklin D. Roosevelt.  Perhaps the highlight of his trip was the meeting with the Queen at Windsor Castle, thereby becoming the 13th US president to meet the monarch (the first was Harry Truman in 1951 when she was then Princess Elizabeth).

The playwright George Bernard Shaw famously noted that Britain and the US are “two nations separated by a common language”. As an American who has lived and worked in the UK for more than two decades, I certainly feel the mutual affection between us.

Parallels and contrasts

The similarities and differences often focus on political, economic or social factors. But in a year where acts of charity have regularly made the headlines, it is worth exploring parallels and contrasts in the US and UK’s philanthropy. There are four key points I’d like to highlight.

First, philanthropists in both countries have stepped up at this time of drastic need. The coronavirus pandemic has stimulated an increase in money donated but also engagement in philanthropy. The Giving USA Foundation recently revealed that donations in the US grew last year despite the economic downturn. A record $471bn was donated to charity in 2020, with private foundations accounting for $88.5bn, an increase of 17 per cent on 2019. Similarly, the Sunday Times Giving List showed that charitable donations from the UK’s wealthiest people surpassed £4bn ($5.5bn) in 2020, the first time it had done so in the list’s 20-year history. While the pandemic has understandably triggered an important debate about the distribution of wealth, no one can ignore the significant role that philanthropy has recently played in alleviating poverty and distress.

The enduring power of philanthropy should not be a surprise given our long and shared transatlantic history, which is the second point worth noting. The Scottish-American industrialist, Andrew Carnegie (1835-1919), wrote a seminal essay about philanthropy in 1889. In “The Gospel of Wealth”, he argued that wealth should be distributed in a responsible and thoughtful manner, calling on other millionaires of his era to distribute wealth for the public good.

Carnegie was building on the model set up by another great Anglo-American philanthropist, George Peabody (1795-1869), who is widely acknowledged as the father of modern philanthropy. A US-born financier, Peabody received worldwide recognition for his philanthropy in both countries, founding the Peabody Institute and Peabody Trust respectively in the mid-19th century. The Peabody Trust pioneered social housing, one of the earliest examples of impact investing, and is a reminder that while many consider impact investing to be a 21st century innovation, it was first practiced in the Victorian period by creative industry leaders such as Peabody.

Thirdly, while philanthropists in both countries may be spurred by the same macro issues and shared history, there are clear differences in the culture of giving. Philanthropy in the US is more entrenched in the tapestry of society; there is a great sense of expectation that wealthy individuals should give back to their local community or the country, often with appropriate personal recognition in return. The British reserved attitude towards wealth and antiquated associations with noblesse oblige, are perhaps reasons why the mega philanthropists and acts of significant charitable largesse do not exist on the same scale in the UK as they do in the US. McKenzie Scott, Bill Gates, Warren Buffet, or Oprah Winfrey are inspiring global philanthropic figures (just as Carnegie and Peabody were in their day), but the names of their counterparts in the UK don’t as easily roll off the tongue.

Global hub

With that in mind, UK-based philanthropy can all too easily be compared unfavourably to the US, which is unfair and brings me to my final point. There are growing indications that the UK is developing into a global hub for philanthropy. The UK has some of the most respected and favourable legal and regulatory frameworks in the world, which has contributed to a growth in international donors setting up in London. Earlier this year, in a landmark report, the Beacon Collaborative concluded that the UK is “strong at international philanthropy and could become stronger by using its position as a world-leading centre for progressive global finance” to attract international donors. Additionally, the rapid growth of donor advised funds (DAFs) in the UK, which provide immediate administrative convenience and tax incentives, is democratising philanthropy making it more appealing and achievable than it ever has been. The US has seen a similar rapid growth of DAFs over the last decade, and while the regulatory landscape may differ between the two countries, there are plenty of lessons to be shared.

So, as we approach US Independence Day, we can celebrate the important links between the US and the UK, not just in politics, defence and finance, but in philanthropy too. Just as we see in the other sectors, the philanthropy sector should embrace our shared values. Yes, the US excels at philanthropy and charity, but there is justifiably great optimism when it comes to philanthropy in the UK. Given the year we have just been through, that will surely be a cause for celebration on both sides of the Atlantic.

John Canady is the CEO of National Philanthropic Trust UK and is a dual US UK citizen.