FACT CHECK: Is there a crisis of trust in nonprofits?

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Cassandra Chapman, Matthew Hornsey & Nicole Gillespie

University of Queensland

Unless you’ve been living under a rock, you’ve probably heard that there is a crisis of confidence in the charity sector. In recent years a series of high-profile scandals have rocked the sector, including the Oxfam sexual exploitation scandal and the suicide of an elderly British donor Olive Cooke, who had received an estimated 3,000 charity appeals in the year before her death.

Scholars, practitioners, and the media have lamented falling trust in charities and worried about the ramifications for the nonprofit sector. Trust is known to be an essential ingredient for fundraising success. Drops in charity confidence could therefore threaten the survival of the sector as a whole.

My colleagues and I study charity scandals and trust in nonprofits. Through a series of experiments, we have demonstrated that scandals emerging within nonprofits have dire consequences for transgressing organizations. In fact, nonprofits lose trust and consumer support at faster rates after a scandal than commercial organizations do.

It’s clear that scandals damage trust in particular organizations. But do highly publicized scandals also damage trust in the sector as a whole?

To answer this question, we accessed global data collected as part of the Edelman Trust Barometer. Each year, Edelman survey people around the word and ask, among other things, how much they “trust NGOs in general to do what is right”. Edelman shared data from 294,176 people in 31 countries over a period of 9 consecutive years.

We analyzed these data in a way that had not been done before. Specifically, we looked at trust trends after taking into account individual differences (i.e., the fact that some kinds of people are more or less trusting) and country differences (i.e. the fact that some countries are generally more or less trusting and that different countries may show different trust trends over time).

Spoiler: There is no global crisis of trust in nonprofits

Our analysis shows no significant decrease in trust over time. In fact, once we accounted for individual and country differences, trust in NGOs has actually increased slightly around the globe between 2011 and 2019.

It’s true that some people and countries show different trends. For example, the increase in trust was sharper among men, people aged under 40 years, and people with higher education, income, and media consumption. Although some countries showed small increases and some showed small decreases in trust, none of these trends was substantial in size. In other words, there is no was no evidence that trust in NGOs has changed meaningfully in any of the 31 countries over the last decade.

So why do the public still trust nonprofits despite the scandals?

The short answer is we don’t know. The data allowed us to identify if trust was changing over time but not why.

We have some ideas about what might be going on though. Charities, generally speaking, have reputations for being moral. We suspect that this good reputation functions as a kind of “trust bank” that buffers charities from the effects of scandals. Perhaps over time the sector makes deposits in the community trust bank through their good works in society.  When scandals emerge within individual organizations, this may draw down some of the community trust that has built up over time but have very little impact on reserves of trust in the overall sector. 

What does this mean for nonprofit managers?

If the good deeds of charities cultivate trust banks from which they can safely draw on in times of crisis—an idea that has not yet been evidenced—then a key strategy will be to ensure all successes are communicated both to the supporter base and to the wider public.  Nonprofit leaders should also encourage other organizations within the sector to do the same.  When the nonprofit sector works together to highlight their good works, the entire sector may benefit in the future when unexpected scandals erupt within the community. 

Click here for the original NVSQ articlefree full text access until the end of 2020!

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