This literature review is about private cultural funding, both in terms of earned income from various sources and contributed income from different private actors. The report describes how the Nordic countries' approach to financing the cultural sector has developed over time, and how the countries' contemporary policies are designed in relation to the issue of private cultural funding. The literature review also compiles statistics on private cultural funding in the Nordic countries and concludes with a discussion on the consequences of an increased focus on private cultural funding. The basis for the literature review consists of previous research and statistics. The report focuses on art and cultural areas prioritised by the cultural policy of the Nordic countries and emphasises museum and performing arts activities.
The Nordic countries’ policies on private cultural funding
Once mainly a concern of markets and private actors, public funding of arts and culture in the Nordic countries was gradually expanded during the 20th century. From a political perspective, the expansion was often seen as part of the respective countries’ welfare development and led to a formalisation of cultural policy during the 1960s and 1970s. Moreover, certain aspects of commercial culture were viewed with scepticism. However, from the 1980s and 1990s, cultural policy gradually shifted, reflecting a more positive attitude towards private cultural funding and the ambition that publicly-funded cultural activities should increase their own revenues and attract support from private actors. Particularly during the 2000s, the countries have implemented certain measures aimed at increasing private cultural funding. The measures have mainly involved:
strengthening cultural activities' competence in private financing, and supporting collaboration between cultural and business actors.
introducing financial incentives for increased private cultural funding.
making changes in public funding and increasing the demands and expectations for cultural activities to increase their income from private sources.
The measures for competence development and increased collaboration have varied, but have aimed, among other things, to strengthen the business skills of cultural activities and facilitate collaborations and exchanges between culture and business.
Examples of financial incentives that have been introduced are deductions for corporate donations to cultural organisations in Denmark, and limited deduction options for private individuals, which exist in all countries except Sweden. Another example is that Norway introduced a matching system between 2014 and 2022, which meant that cultural activities receiving private donations were rewarded with additional state funds. All countries have also introduced, or are planning to introduce, so-called production incentives in the film sector. Likewise, all countries have long applied lower VAT rates on certain cultural goods and services and have allowed tax deductions for sponsorship of cultural activities. In particular, Finland and Sweden are planning or investigating the introduction of further financial incentives.
In terms of cuts and requirements, Denmark implemented a two percent savings requirement for all state-funded cultural institutions between 2016 and 2020, which increased the need for own income in these institutions. Examples of cuts in public funding are found also in other Nordic countries. In several Nordic countries, funding authorities are also encouraging cultural activities to increase their private funding, for example, by stating this as an advantage, or an assessment criterion, in grant decisions.
The presence of private cultural funding in the Nordic countries
The Nordic countries have a similar financing structure in the cultural sector in terms of the distribution between public and private funding. As regards private funding, household cultural expenditure is of great significance in all the countries. However, it is difficult to assess more precisely how significant this source of funding is for the art and cultural forms closely related to cultural policy.
One difference between the Nordic countries is the level of funding from private foundations. This is strikingly high in Denmark and strikingly low in Sweden. Finland, on the other hand, is the country where private foundation funding has increased the most in recent years. The differences in foundation funding are largely due to historical differences in tax legislation.
Corporate sponsorship of culture is slightly higher in Norway compared to Finland and Sweden. Sponsorship to art and cultural forms closely related to cultural policy is, except from in Sweden, less significant than private foundation funding. Based on available statistics, sponsorship within the museum and performing arts sectors in the Nordic countries is of little importance. If sponsorship of festivals in Norway is excluded, cultural sponsorship shows a negative rather than positive trend in the Nordic countries.
Statistical comparisons between individual cultural sectors in the countries should be made with caution. In the museum sector, however, it is clear that private funding is considerably higher in Denmark compared with the rest of the Nordic region. This can be linked to higher proportions of private foundation funding and admission revenues, and also greater income from archaeological excavations. In the performing arts sector, the proportion of private funding appears to be higher in Denmark, Finland and Iceland compared with Norway and Sweden. It is important to note that there are major differences between individual cultural organisations in terms of the proportion of private versus public funding.
Possible consequences and important policy issues
The consequences of an increased focus on private cultural funding are closely tied to the countries' core cultural policy values, such as the autonomy of the arts, cultural diversity, and everyone’s opportunity to participate in cultural life. Fundamentally, it is positive for the cultural sector’s autonomy and room to manoeuvre if there is a greater diversity of funders, including private actors. At the same time, there is a risk that cultural organisations may need to adapt their activities to private actors’ interests, motives, and drivers. What these motives and drivers are can vary, but they are not necessarily linked to, for example, artistic considerations. Private actors also often lack organisational structures for expert assessment and arm’s length distance. In this context, research speaks of a more fundamental transformation that concerns the fact that issues around entrepreneurship, marketing, fundraising and audience attractiveness have become increasingly important in the cultural field. This development affects the competence needs of cultural activities, but is also assessed to influence the artistic, cultural and educational work, mainly in the direction of what is believed to attract visitors or private funders.
A theme highlighted in many studies is that private funding is generally project-based and shorter-term than public funding. On the one hand, this can create opportunities for initiatives and projects that are difficult to obtain public funding for. On the other hand, the need for increased private funding may mean that cultural organisations need to ‘projectify’ a larger part of their operations, which may negatively affect their core activities and long-term artistic development work.
Regarding issues of diversity, accessibility and participation, research discusses how more funders and increased private funding can contribute to greater cultural diversity, as different funders support different types of culture. Efforts to increase own revenues are also assessed as potentially contributing to positive audience development work, as cultural organisations seek contact, and build relationships, with new audience groups. However, research also suggests that larger cultural activities and certain cultural forms and expressions are better placed to attract private funding, which potentially can have negative effects on cultural diversity. In this context, there is also research that points to the risk of increased geographical skew in the distribution of cultural offerings.