Diminishing trust in nonprofits a troubling trend

These are challenging times for nonprofits. The COVID-19 pandemic spread resources at many charities perilously thin while making traditional fundraising difficult, if not impossible.

And like seemingly everything these days, the philanthropic world has been increasingly sucked into the fractious public conversation, where arguments are had for argument’s sake, the truth is often an inconvenience, and the most important thing is not what is right but whose side you’re on.

Maybe it’s a spillover from an increasing distrust of government, media and science, but faith in charitable organizations is flagging.

A new study from Independent Sector, a nonprofit collaborative, showed the public’s trust in nonprofits fell from 59% in 2020 to 56% in 2022.

That may not seem like a lot, but it’s significant, and part of a troubling trend.

Trust in overall philanthropy — which includes private and corporate foundations — fell 2% over the same period.

While the drop is not a “four-alarm fire,” Jeffrey Moore, chief strategy officer at Independent Sector, told the publication Philanthropy Today.

“But any time that we see trust on a downward slope, we have cause to be asking ourselves really hard questions.”

Recent news hasn’t helped. Examples of high-profile charitable abuse abound.

Earlier this month, Steve Bannon, the notorious former Trump administration aide, was indicted on charges of money laundering, fraud and conspiracy for allegedly misusing donor money meant for the anti-immigration group We Build the Wall.

In Oklahoma, leaders of a nonprofit created to aid Native American women have been accused of using donor money to line their own pockets. And in January of this year, Massachusetts Attorney General Maura Healey announced a $6 million settlement with Manuel Duran, the former head of Casa Nueva Vida homeless shelters in Lawrence and Boston.

Duran was charged with lying to the state and funneling money to himself “all while falsely certifying compliance with state regulations designed to detect such improper self-dealing,” Healey said.

Such stories come at a time when there is a generational shift in attitudes toward philanthropy, and in the ways money is raised. The boom in Gofundme campaigns and other social media-driven efforts mean donors are often bombarded with requests for cash. It can be difficult to separate the saints from the scammers.

There are, however, several ways for donors to protect themselves, and to make sure the money they give is being used to its best effect.

There are several organizations that track larger nonprofits, chief among them Guidestar, Charity Navigator and the Better Business Bureau.

All have online databases allowing donors to enter the name of a nonprofit and get a detailed analysis of their reliability and spending habits.

While those watchdogs track larger organizations, assessing smaller organizations and efforts requires more work.

Sometimes that means calling those groups directly, or checking up on them on the website of your local newspaper. And when it comes to online fundraisers, a little tech savvy can go a long way. A reverse image search, for example, can reveal if scammers have plucked a photo from a legitimate fundraiser to use as their own.

There is much charities can do to reassure their donors, also, from tapping in to community and civic leaders for vocal, public support to being more transparent about how money is being spent.

The vast majority of charities and nonprofits are on the level and doing important work. In the current political climate, however, a little more work on the part of donors and donees is needed to rebuild the trust that has eroded over the past few years.