Opportunities for the UK philanthropy and impact sector in 2025

Please note: References to specific entities or individuals should not be seen as an endorsement.

In an economically challenging and uncertain year, how can philanthropists, charities, and the impact-finance sector respond with new and better approaches to support people, planet and a sustainable future?

In February, the Beacon Philanthropy and Impact Forum hosted a series of discussions between 200 prominent sector representatives – ranging from philanthropists, charity leaders, policy makers, academics, philanthropy sector leaders, and sustainable finance professionals.

As attendees and roundtable hosts, we heard several notable, sometimes challenging, themes emerge. By sharing these in this article, hopefully they spark new ways of seeing the world and innovative ideas, as well as encourage greater action and collaboration. 

Philanthropists are moving beyond traditional giving

A panel of next-generation philanthropists – a broad category defined often as those who have inherited wealth and who are taking a different approach – shared how they’re looking at whether their businesses and investments, including those owned by or inherited from their parents, align with their values. 

One speaker, Sonal Sachdev Patel, Chief Executive of the GMSP Foundation, suggested that values-driven philanthropy should ensure that the decision-making process is in the hands of communities, and that funding is unrestricted and multi-year, rather than limited to short-term project-restricted grants.

Patel noted that newer philanthropists are increasingly “moving beyond traditional giving models to focus on root causes, systems change, and the structural forces that create and sustain inequality”. These individuals “aren’t just funding charity – they’re questioning the very systems that created their wealth,” she said.

Reflecting on this, Juliet Agnew, our Head of Philanthropy, said her conversations were shifting along these lines. “We know that for many wealth holders, true wealth is about more than money, and philanthropy is about more than giving. A sense of purpose and contribution is a significant part of this – be it within families and communities, as leaders, philanthropists or investors.” 

Philanthropy needs more “permission to fail”

Bold, calculated risks are an accepted, and encouraged, part of business. Charities arguably have an even greater need to take risks, given the complexity and persistence of the challenges they address.  

However, innovation can be challenging in an environment with rising costs, fewer major donors, and many donations restricted to specific projects. The innate caution and inflexibility of many donors was contrasted by the attendees’ discussion on how the sector needed to be more comfortable with risk-taking, even if the outcome was failure. 

David Holdsworth, Chief Executive of the Charity Commission, advocated that philanthropists had the power to “do what other funders –notably public sector funders – cannot”.

“They can take risks and innovate, work out new solutions to deep-rooted problems by trying and testing,” he explained. “They can support charities’ core costs, helping them develop long-term viability and stability, rather than living only from one grant to the next. And philanthropists can sow seeds, offering large, one-off donations that allow new charities to get off the ground, or established charities to plan for the long term.”

In the end, participants had widespread support for Agnew’s idea that, so long as decisions are informed, and learning takes place, philanthropy must have the “permission to fail”.

Philanthropy can be the catalyst for collaboration

In his remarks, Holdsworth also suggested a “once-in-several generations opportunity” to create “a new era of philanthropy to tackle our most intractable social challenges”.  

He explained further that, “philanthropy alone cannot make a city or a community, or reverse a social ill. But it can act as a spark that re-ignites hope and gives a community the confidence to revive itself, and to unleash its potential to adapt to changing economic, political and social circumstances.”

This was reinforced by remarks from Stephanie Peacock, Minister for Sport, Media, Civil Society and Youth, who highlighted the Civil Society Covenant that aims to “harness the knowledge and expertise of voluntary, community, social enterprises and charities to deliver better outcomes for communities right across the country”¹.

Nandu Patel, our Head of Charities, noted “Many charities and not-for-profits are seeking novel ways to leverage limited financial resources. Whether through sustainable and impact investing or collaborative endeavours, they are recognising the need and the opportunity to achieve better outcomes than they can achieve in isolated giving or delivery.” 

Re-emerging emphasis on place-based philanthropy

Place-based giving – in other words donors committing support for communities to which they’re connected – emerged as a significant opportunity across the Forum’s discussions. 

“This approach to philanthropy leads to a deeper understanding of local needs and enables communities to take action on the specific challenges that affect them”, explains Isabelle Hayhoe, Senior Philanthropy Adviser. “This kind of funding also supports community resilience, as donors commit to more long-term funding and partnerships”.

Linked to this, is the opportunity for philanthropists to think beyond financial donations, or “treasure”, to giving their time, talent, and ties (collectively the “4Ts”). This unlocks the concept of service and contribution as an important value which is accessible; not just to the wealthiest. 

Advisers have a critical role to educate and stimulate giving

Neil Heslop, Chief Executive of the Charities Aid Foundation (CAF), highlighted that charities were “relying more and more on a smaller and smaller group of generous givers”. He also pointed to CAF research which suggests that some of the least affluent areas in the UK are the most generous.

While many lauded the UK’s historically strong culture of giving, the potential decline in the number of significant donors was a concern that echoed around the Forum. In response, Agnew viewed wealth advisers playing a more active role to educate and support new philanthropists.

“Wealthy families, especially newer ones, often look for education on the basic issues and questions to consider, which is why our Guide to Giving continues to be so popular. By highlighting the philanthropic journeys and experiences, we see it inspire these families on what’s possible when it comes to activating their values through their wealth. Moreover, collecting evidence to provide clear benchmarks and insights is valuable to inform philanthropists and the wider sector, which is why we’re supporting the Beacon Collaborative’s research on the HNW Philanthropy Market Sizing in 2024 and 2025.” 

Progress and opportunity, but much more work to do

Ultimately the calls for new approaches, risk-taking, collaboration, focus on place, and the importance of education are certainly not new. But they come at a time of greater challenges and heightened need for thoughtful philanthropy. 

The Forum encouraged attendees to have the humility to listen and learn from others, not reinvent the wheel or need to “go it alone”. Barclays Private Bank was pleased to be a sponsor of the event and share a selection of reflections for both those who did and did not attend. Further reflections and responses are welcomed. 

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