Leaders must confront declining trust in the nonprofit world – before it’s too late

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I have spent most of my professional career working for organizations that are difficult to explain. To make my life easier, when strangers ask me what I do, I usually answer in shorthand: “I work for a non-profit association”. Invariably, people warm up to this response. I’ve come to think of this as a halo effect – the assumption that I must be a decent guy if I’m working at a nonprofit.

Unfortunately, there are signs that the nonprofit halo may be fading.

A recent independent sector survey found that only 56% of Americans express trust in nonprofits, down 3 points from 2020. Compared to increasingly suspicious government institutions such as the Court supreme and the Congress, it’s not terrible. But for a field primarily focused on improving society and helping the underprivileged, that’s not great.

A Morning Consult poll released in June found a similar trust gap, with more than 4 in 10 respondents saying they had lost trust in an individual nonprofit. Even more concerning, trust in nonprofits has declined with each passing generation: only 46% of Gen Z adults expressed trust in nonprofits, compared to 67% of baby boomers.

What explains these worrying signs? Nonprofits are not immune to the current sense of unease and skepticism that has led many Americans to question conventional wisdom and rebel against authority figures. But nonprofits also face several specific threats.

From the left come concerns about the so-called “nonprofit industrial complex.” Activist groups such as Incite are effectively used by governments to “manage and control dissent” and “make the world safe for capitalism.” For these advocates, nonprofits are a tool to blunt the kind of grassroots organization that could truly transform society.

In the view of these critics, many nonprofit organizations have no interest in actually solving the problems they claim to solve. The thinking is: why would a shelter provider want to end homelessness when it depends on the existence of the homeless to pay its bills, including the sometimes exorbitant salaries that go to its leaders?

Moreover, some on the left argue that the very existence of nonprofits inappropriately diverts government attention and resources. For example, in his latest book, Nonprofit Neighborhoods: An Urban History of Inequality and the American State, Historian Claire Dunning argues that nonprofits have been the unwitting handmaidens of neoliberalism, reinforcing a political narrative about the failures of government programs and the need for market-driven solutions.

From the center and the right comes a very different analysis. These critics see nonprofits increasingly in the grip of a progressive ideology well outside the American mainstream. Many blame recent graduates from elite colleges for fundamentally changing the culture of the field, making it more focused on social justice and less on liberal values ​​such as due process and free speech.

Michael Lind, a professor at the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin, laments what he calls an “NGOsphere” that negates “innovative thinking.” Write in the Tablet, Lind describes a non-profit world in which open debate “has been replaced by compulsory assent and ideas have been replaced by slogans that can be recited but not questioned: Black Lives Matter, Green Transition, Trans Women Are Women, 1619, Defund the Police”.

Even some centre-left observers have come to agree with elements of this criticism. In a much-shared article in The Intercept, journalist Ryan Grim explained how staff meltdowns hamper the effectiveness of many nonprofits. Grim spoke to many leaders who worried that internal staff rebellions over issues like performance reviews, microaggressions, and diversity metrics had essentially made nonprofits “unmanageable.” In a telling anecdote, Senator Bernie Sanders, the independent and progressive icon from Vermont, allegedly hurled this blunt accusation at his campaign leadership team: “Stop hiring activists.”

Another threat to public trust in nonprofit organizations is self-inflicted. Recent years have brought a steady stream of other apparent cases of nonprofit mismanagement: the cynical marketing strategies of the Southern Poverty Law Center. The Black Lives Matter Global Network Foundation’s $6 million home purchase. A quid pro quo deal to write an op-ed for an actor in exchange for a large donation to the American Civil Liberties Union. The list continues.

Steps to take now

How can nonprofits build public trust in their effectiveness? The first step is to admit that while none of these criticisms are completely accurate – nonprofits are not, after all, uniformly neoliberal, woke, or corrupt – there is at least some merit to each of them. ‘between them. Addressing these legitimate concerns will not happen without a concerted effort.

Nonprofits must first engage in healthy self-reflection, emphasizing the “healthy”. This shouldn’t be seen as another excuse to stare at your navel. Instead, they should strive, as part of their standard strategic planning process, to ask the hard questions about whether they are making real progress toward achieving their mission instead of just perpetuating their own existence. .

Second, at a time when nearly all nonprofits are obsessed with diversity and inclusion, they should explicitly seek to recruit an ideologically diverse workforce. The nonprofit world should not be the exclusive domain of progressives. Nonprofits need to recognize the value of politically moderate and conservative staff members who can offer a different perspective and help test the viability of new ideas.

Finally, large nonprofits should seek to partner with and, in some cases, reallocate funds to smaller, Black-led community organizations. It’s a way to help address concerns that, despite widespread philanthropic commitments to equity, funding is still not reaching organizations at the grassroots level led by people of color.

Government and foundations can help

However, nonprofit organizations cannot tackle this problem alone. They will also need the support of their government and philanthropic partners.

Many nonprofits, especially those that provide direct services, depend on government support. Unfortunately, government agencies too often lead tough negotiations, forcing nonprofits to cut overhead and submit budgets that don’t reflect the full costs of delivering services. Until the government moves away from this money-and-pound orientation, non-profits will struggle to pay staff properly and create the kinds of administrative and fiscal systems essential for proper management. efficient.

Philanthropy has gone through a process of calculation all its own in recent years. As a result, many foundations have moved to reduce the demands they place on grantees and offer general operating support instead of short-term, project-specific grants. It’s all for the best. But even if foundations ease administrative burdens on their grantees, they must also be aware of the ideological constraints they impose. Funders should strive to be less prescriptive while recognizing that not all nonprofits need to look and feel like an activist group.

Public trust is essential to the proper functioning of not-for-profit organizations. It is to the credit of the field that it continues to outperform many other institutions in public trust, including the media. But nonprofits cannot rest on their laurels. Together with their governmental and philanthropic partners, they must act now to build public trust, because once the halo effect is lost, it will be difficult to regain it.


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