Mistrust of NPOs Up, Reflecting Overall Views of American Institutions
Mistrust of NPOs Up, Reflecting Overall Views of American Institutions

Trust in major American institutions is low, and while nonprofits, small businesses and local community members are trusted by either a majority or near-majority of the public, even their status has waned.

Overall, 56% of Americans trust nonprofits, down “a statistically significant” three percentage points from a 2020 benchmark study. Trust in philanthropy, whether corporate philanthropy, private foundations or philanthropic efforts from high-net-worth individuals slipped from 36% to 34% during the same period.

The data is from Trust in Civil Society: Understanding the factors driving trust in nonprofits and philanthropy, the third iteration of an annual survey study on the rule of trust in nonprofits from Independent Sector in Washington, D.C.

The factors that influence trust are those one might expect. Integrity and purpose boost an organization’s image, as do personal experiences with a nonprofit, financial transparency, proof of impact, public figure endorsements and clear communication of mission and values. What erodes trust? Unsurprisingly, it is perceived fund mismanagement and actual instances of corruption and scandal.

Given the challenges perception of government presented of late, respondents indicated the fact that nonprofits are regulated and held accountable by government boosts their trust. Nonprofits, with a 56% “high trust” level, are more than twice as likely than the federal government (26%) to be trusted “to do what is right,” according to respondents.

Women are increasingly viewing nonprofits with suspicion. Their trust in these organizations has fallen by five points since 2020, a decline report authors attribute to drops in financial well-being and lack of familiarity with nonprofits, two factors that correlate strongly with mistrust. Men’s view of nonprofits remained stable during the same period, leading report authors to speculate slower post-COVID financial improvement among women is contributing to their skepticism.

The impulse toward a lack of trust is even more pronounced among the up-and-coming generation of funders and volunteers. Among GenZ respondents (loosely defined as those born after 2000), trust of nonprofits is six points lower than the overall population, and trust of philanthropy was nine points lower. But this generation also expressed a high level of neutral sentiment, meaning their opinions can still be influenced and, hopefully, improved.

More respondents indicated the closer to a supported cause they can make their donations, the greater the impact of their donations. While 47% said donating to an organization that supports their cause made the greatest impact, 53% believe donating directly to the people or cause they support resulted in the biggest impact.

Potential supporters are definitely looking before they leap. More than four in five (81%) need to know a great deal about an organization before they choose to support it, and 78% said nonprofits needed to earn their trust before potential supporters became actual supporters.

There is some good news in terms of how the philanthropy subsector is viewed. Possibly due to a recent slew of stories about high-net-worth individuals making donations, respondents expressing “low trust” of this group fell from 31% a year ago to 22%, while the percentage expressing high trust rose from 28% a year ago to 34%. Similarly, stories of corporate philanthropy, especially in light of nonprofit struggles during the coronavirus pandemic, cause low trust of this subsector to fall from 25% to 19%, while the percentage indicating high trust ticked up from 31% to 34%.

Philanthropic individuals and institutions are seen as deserving high levels of trust based on their perceived motivations, reports of well-known public figures who are philanthropists and insight into and transparency of these funders’ efforts and donations.

Factors that correlate to a higher level of trust over the average population of both nonprofits and philanthropy include having a college education, being a registered Democrat, an annual household income in excess of $75,000, being African-America or being a member of the Millennial (born between 1982 and 2000) generation.

Among the survey’s other findings:

* 61% of respondents donated money and 58% donated goods at least once during the past 12 months.

* 54% advocated for a cause.

* 43% volunteered time, with those that did giving five hours a month for actual volunteer work. Those doing advocacy work did so for two hours per month, whether advocating on their own or through a nonprofit.

Independent Sector partnered with Edelman Data & Intelligence in surveying more than 3,000 American adults. The study was conducted online, with each survey taking roughly 20 minutes.