Published Wednesday, 19 December 2012
Grafton Street in Dublin is lit up for the season of goodwill. (© Getty)
Australia was ranked the most generous nation, with Canada coming third in the 2012 World Giving Index report.
The UK was placed fifth last year and the charity said the drop can be attributed to fewer people making charitable donations and volunteering time.
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.
John Low, chief executive of the Charities Aid Foundation, said: "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."
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