Britain has fallen to eighth place in the annual league table of world generosity, according to the Charities Aid Foundation (CAF).
The charity said the drop can be attributed to fewer people making charitable donations and volunteering time, after the country was fifth in last year's annual survey.
Australia was ranked the most generous nation, followed by Ireland and Canada in the 2012 World Giving Index report. New Zealand was fourth, with the fifth to tenth most-generous nations being the United States, Netherlands, Indonesia, UK, Paraguay and Denmark respectively.
The report assessed charitable behaviour worldwide between 2007 and 2011. It is published in the wake of recent CAF research reporting that one in six British charities fear they may have to close in the next 12 months as a result of cuts in public spending and the overall fall in giving.
CAF, which promotes charitable giving and provides financial services and social finance to not-for-profit organisations, compiled the annual report using statistics produced by international polling company Gallup.
Countries were assessed on three types of charitable behaviour; giving money to good causes, volunteering time and helping strangers, all within the past month.
Although Britain is ranked as fourth in terms of the proportion of people donating to charity (72% of the population), the nation was ranked eighth overall after an aggregate score was given to each country combining the three types of giving.
More women donated money than men over the past five years, but men were more likely to volunteer time and help a stranger, according to the findings. More than 155,000 people in 146 countries were surveyed during 2011.
John Low, chief executive of the Charities Aid Foundation, said: "Britain remains one of the most generous countries in the world and it is fantastic that so many people still give their time and money to support the causes they care about.
"But with fewer people in Britain donating money, volunteering time and helping a stranger, it is little surprise that many charities are facing a tough time. With significant public spending cuts also coming through, many charities are having to dip into reserves and close frontline services, while one in six are even contemplating closure. It has never been more important to back charities in Britain and around the world."