Public trust in nonprofit organizations

Public trust in nonprofit organizations (NPOs) is the extent that stakeholders consider nonprofit organizations reliable and truthful to what they do and communicate. Concretely, this means that stakeholders believe that nonprofits’ acts conform to their goals, including that these NPOs do not produce profit for personal and/or private gains (Hansmann, 1987). The public aspect of public trust in NPOs focuses on the aggregated trust perceptions—or shared cognition—from several relevant stakeholder groups, like beneficiaries, donors, funders, volunteers, employees, and collaboration partners, such as government agencies, businesses, and other NPOs. Hence, individual stakeholders can trust NPOs to a different extent, depending on various factors, such as their concrete stakeholder role towards the organization, earlier experiences, personal needs and preferences, and access to information about the NPO (Becker et al., 2020). The aggregated concept of public trust in nonprofits is the extent to which these individual trust perceptions are shared within larger stakeholder groups.

However, aggregation at different levels is not limited to the side of the stakeholders alone. Also, on the nonprofit side, different conceptual elements about NPOs can be distinguished to clarify the different theoretical and practical perspectives on public trust in NPOs. These conceptual elements are (1) the general concept of nonprofits; (2) the nonprofit sector and/or networks of nonprofits; (3) NPOs; and (4) particular persons representing an NPO in concrete interactions with stakeholders (i.e., individual internal stakeholders). Figure 10 gives a conceptual representation of these different levels on the stakeholder-side (left) and the different conceptual elements forming trust in nonprofits (right).