What Does Trust Have to Do With Nonprofit Success?

In “The Speed of Trust: The One Thing That Changes Everything,” Stephen M.R. Covey shares that when trust in a relationship increases, speed goes up with it and cost comes down. Everything happens faster and costs less because trust has been established.

That's a dividend, a high-trust dividend.

Covey suggests that trust has two components: credibility and behavior.  

“Credibility flows from having both character and competence,” he shares. “Behavior is what we do and how we do it.”

To make a gift that is significant to them, most donors will process the gift decision through this lens. They will want to know (or at least feel) that the nonprofit is being led by a board and CEO/senior staff of character (they are honest and transparent) and competency (they can deliver on their promises). These perceptions are validated by the behavior of the organization that the prospective donor observes.

For decades, the United Way was one of the most successful, powerful nonprofits, and its affiliates were respected and perceived as trustworthy. Then, in 1992, the longtime CEO retired amid criminal charges of fraud and mismanagement, as well as inappropriate personal behavior. This scandal rocked the United Way system and the nonprofit sector.

Since then, there have been scandals on varying levels in every sector of the nonprofit community — instances where staff leaders broke the public trust and their boards were not providing appropriate oversight to prevent the criminal activity and indiscretions or at least catch them earlier.

Often, we share that a board holds the resources and reputation/culture of an organization in a public trust. Its job is to ensure that the nonprofit fulfills its mission and to safeguard the organization’s resources/assets, as well as its reputation and culture.

Institutions worldwide are falling in trust and nonprofits are not immune, according to the 2022 Edelman Trust Barometer, the 22nd such annual report on trust and credibility.

One might be tempted to point the finger of blame at accusations of “fake news,” civil unrest, foreign influence in politics and political divisiveness in the United States, but trust is falling around the world. Almost half of respondents shared that government and media are divisive forces.

For 19 of the 22 years, non-government organizations had been the most trusted institutions. Government rose to the top at the beginning of the pandemic in 2020, but for the past two years, business has been cited as the most trustworthy.

Globally, the 2022 report found, the most trusted institutions are:

1. Business: 61%
2. Non-government organizations (NGOs): 59%
3. Government: 52%
4. Media: 50%

While NGOs had the highest ranking for ethical behavior, respondents saw businesses as more competent. Edelman suggested that nonprofits had lost their lead, in part, because their work had become politicized and they were losing the perception that they are leaders.  

Edelman said that the societal role of businesses is here to stay: People want more business leadership, not less. The report suggested that nonprofits must:

• Show the system works by demonstrating tangible progress to restore belief in society’s ability to build a better future.
• Focus on long-term thinking over short-term gain and work past divisiveness toward solutions.
• Provide credible information. Trustworthy, consistent and fact-based information is critical to breaking the cycle of distrust.

One of my mentors, the late Conrad Fink, influenced my approach to nonprofits — and fundraising. This intimidating former marine was vice president of The Associated Press at its heyday and had reported news from all over the world, including combat situations during the Vietnam War.

Conrad, like a Marine drill sergeant, indoctrinated in us that journalists were to pursue the facts and the truth, verify them and never let personal opinions interfere with what he considered a public trust. Journalists were to speak truth to power and be a watchdog of institutions.   

As nonprofit leaders, restoring trust in our individual organizations and in our sector is vital. We have incredible missions to fulfill, lives to change and lives to save. We cannot fulfill this high calling when our integrity and/or competence is questioned.

Edelman calls for stronger leadership — and I concur. This includes setting and upholding higher standards for performance and ethics.

For fundraising professionals, in particular, this means carrying what sometimes can be a burden: ensuring that the organization is being ethical in its dealings with donors.  This means — like the true journalistic calling — speaking truth to power to senior leadership, the CEO and board members when an organization is failing in trust.

It also means upholding the highest standards of fundraising professionalism, which includes providing strong leadership on what are the most appropriate and effective means to deepen relationships and reach the organization's fundraising potential. It means speaking up to well-meaning CEOs, other staff leaders and board members who would prefer development staff to detour from proven best practices and chase tasks with far less impact and return.

What happens in one nonprofit has the potential to affect the public and donor perception of all nonprofits and the sector as a whole. It’s incumbent on nonprofit professionals to commit to a concentrated effort to build and safeguard trust in our worthy nonprofits and our sector.