Swedish philanthropy - an oxymoron, or not?

The philanthropic landscape is forever changing, following the wave of time and finances. The Gilded Age in the late 1800s, mainly manifested in the U.S., established the industry as an influential social entity, in which the wealthy could share their largesse in ways that also benefited them for financial reasons. Yes, many were benevolent and created legacies that reverberate today, most famously the free libraries built by Andrew Carnegie, but the generosity through philanthropy was largely a vehicle to minimize taxes for the rich. 

Today, philanthropy is an established part of society, in the U.S., as well as in other countries, such as Sweden. 10% of the U.S. workforce are engaged in the charitable sector, which receives almost 560 billion USD in donations while contributing 1.4 trillion USD to the U.S. economy. Swedish nonprofits received 28 billion SEK in donations in 2023, a sizable amount given the somewhat new tradition among individual donors. As Swedish civil sector grows, it might not come as a surprise that over the last 25 years, Sweden has become a new playing field for a class that likes to be known for ‘doing good’.

An article in Dagens Nyheter (May 10, 2025) caught my eye on how the philanthropic sector is gaining ground in Sweden; currently, the country has the most billionaires per capita, double that of the U.S., and many are so called dollar billionaires.

To put it more bluntly, the group has grown from 28, 25 years ago, to 542 today.

So how is this possible, you may ask, in a country that is, if not socialist, at least a social democratic welfare state where equality rules the day?

Even the Financial Times picked up on the anomaly, rooted in people’s minds, that Sweden since post-WWII, distributed its wealth equally.

What the rest of the world might not be aware of is that Sweden has done a remarkable shape-shifting exercise in redistributing wealth since the mid-1990s, adhering to a steady liberalization in the political and financial areas. A reformist, right leaning coalition government, led by the Moderates, which at the time was the right-with party of choice (Sweden Democrats, a nationalist party has since gained significant ground), began privatizing government services that previously had been run as state agencies. For example, the publicly funded postal service and public train system have been privatized. Another example is the school system, which was opened up to private ownership with a country-wide version of school choice, where a pot of money is attached to each student to bring to whichever school of their choosing, private or public. More on the education of the country’s children in a later blog.

For now, back to philanthropy.

Below the DN article, which featured the philanthropist Cristina Ljungberg, an American woman and Swedish billionaire, who has lived in Sweden for many years, was another article – how fewer Swedes than ever can afford to buy a house.

The discrepancy between the articles was noticeable, and as such, mirrored a society where the Gini coefficient for Sweden has been rising steadily, reflecting an increased income gap.

From the DN piece, it is evident that Swedish billionaires are actively starting to create a universe of philanthropy, Nordic style. Ljungberg is involved in collaborations with Danes and Norwegians, the latter having amassed vast fortunes from oil and gas production. Many of these individuals and families, with adjoining family and/or corporate foundations, are engaged in climate change and women’s rights; working on bettering conditions for people living in poverty all over the world; and, promoting democratic values – in Sweden. They are involved in multilateral initiatives stretching across the globe and connecting with many layers of old and new philanthropic donors and wealth networks. The Nordic countries’ attitude, sitting on top of the world (!), is showing in their longstanding concern for the well-being of the planet – and now, with billions behind them, leaning on past efforts in diplomacy, which once was the currency of choice, they are poised to exert some serious influence.

Some Swedes are historically skeptic to this new segment of society, even though foundations are common in Sweden. To date, there are 17,000 foundations and trusts, actively working on giving out funds to a variety of causes. The premier Swedish business school, Handelshögskolan in Stockholm, retains a professor who is conducting research and teaching in this growing field, yet there is barely a university course dedicated to the civil sector, as it’s called. You are also not able to obtain a graduate degree in the field. In another twist, legislation is not solidly behind not taxing the charitable sector, although exemptions are common.

But how is this concentration of wealth happening, when at the same time as the billionaires are growing exponentially, more Swedes are falling into poverty? The article is pointing out favorable taxation that makes it profitable to run companies in Sweden; real estate and estate taxes are abolished; tax on capital gains is low, and interest rates was kept close to zero or negative percent for a prolonged period of time.

As is the usual case of Sweden, not many outsiders are aware of the mixing of outright capitalism alongside expansive social assistance run by the government as two sides of the same ‘social system’ coin. The complaint that taxes are high are alleviated by generous benefits overall. For example, with 480 days of parental leave, Swedes are outshining their Scandinavian neighbors, by far.

The journalist also notices that immigration and gang violence is dominating concerns at the moment, with over 800 bombings in Sweden so far this year. This kind of instability, paired with a growing billionaire class, the author predicts, does not bode well for stability moving forward.

In a follow-up article a few days later, also in DN, the problem is put in terms of “bad” and “good” billionaires: 2/3 are of the “bad” kind, who enriched themselves on real estate, capital management and inheritance, and the remaining 1/3 on innovation and production.

So where is philanthropy headed in the domestic Swedish arena? A short survey of the largest foundations in Sweden, the top three are all off-shoots of the finance family Wallenberg, followed by the Axel Johnson family, and based on their respective business interests and history. Many of the foundations are old; Danvikshem, is a hospital that hails from 16th century. As the FT article points out, 70% of the billionaires have inherited their wealth, and despite the investment in startups, there are only three on the list from this category. As more Swedes enter the stratosphere of wealth, various networks, notably the Maverick Collective (Ljungberg), Brilliant Minds (the Spotify founders) stand out. To add to the mix, historically, most royal households, including the Swedish one, have their pet projects with conjoined foundations (too many to list).

The questions for Sweden is how it will remain true to its folkhem roots and still attract a class of wealthy donors, even potentially cajole them to step in when the government is scaling back on services and supports. At this rate, it is clear that the philanthropists have a fertile playing ground, with the ability to set rules and developing a shadow system that mirrors what previously was managed by the state.

Perhaps a philanthropic Sweden isn’t so much an oxymoron as a sign of the times.

Photo: Jonathan Petterson & Mohamad Salam via Pexels