Public trust of nonprofits can augment social benefits of the nonprofit sector by enhancing engagement of the general population in the sector. This study analyzed cross sectional data collected from a random sample of Canadians (n = 3853) to test the effects of respondents’ perceptions of financial accountability, transparency, and familiarity of charitable nonprofits, along with the effects of trust in key institutions on their general trust in charitable nonprofits. Results show that each factor (except for trust in government institutions) has a significant effect on the level of trust respondents had in charitable nonprofits. The study helps advance our understanding of what contributes to trust in charitable nonprofits among Canadians and offers suggestions on how nonprofits can garner greater trust with the population.
This is a preview of subscription content, log in to check access.
Buy single article
Instant access to the full article PDF.
Price includes VAT for USA
These are nonprofits that are tax-exempt [(501(c)(3) designation in the US] and whose primary activities are charitable, religious, educational, scientific, and literary. They test for public safety, foster amateur sports competition, prevent cruelty to children, or prevent cruelty to animals. In this paper, we refer to such nonprofits as ‘charities’ both to distinguish them from the many other nonprofits and to be consistent with the term used in the Canadian context where this research is based.
A copy of this survey is publicly available at: https://www.muttart.org/wp-content/uploads/2015/11/3.-Talking-About-Charities-Full-Report-2013.pdf.
We dichotomized this variable from the question “As far as you can remember, did you donate to charities in 2012?” Regarding volunteering, participants were asked whether they volunteered for any charity in 2012.
Bekkers, R. (2003). Trust, accreditation, and philanthropy in the Netherlands. Nonprofit and Voluntary Sector Quarterly, 32(4), 596–615. https://doi.org/10.1177/0899764003258102.
Bekkers, R., & Bowman, W. (2009). The relationship between confidence in charitable organizations and volunteering revisited. Nonprofit and Voluntary Sector Quarterly, 38(5), 884–897. https://doi.org/10.1177/0899764008324516.
Berman, G., & Davidson, S. (2003). Do donors care? Some Australian evidence. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 14(4), 421–430. https://doi.org/10.1023/B:VOLU.0000007467.74816.a4.
Bourassa, M. A., & Stang, A. C. (2016). Knowledge is power: Why public knowledge matters to charities. International Journal of Nonprofit and Voluntary Sector Marketing, 21(1), 13–30. https://doi.org/10.1002/nvsm.1537.
Bowman, W. (2004). Confidence in charitable institutions and volunteering. Nonprofit and Voluntary Sector Quarterly, 33(2), 247–270. https://doi.org/10.1177/0899764004263420.
Brindle, D. (2018). Oxfam scandal is a body blow for the whole UK charity sector. Guardian. https://www.theguardian.com/voluntary-sector-network/2018/feb/13/oxfam-scandal-body-blow-uk-charity-sector-sport-relief. Accessed 6 July 2018.
Bryce, H. J. (2007). The public’s trust in nonprofit organizations: The role of relationship marketing and management. California Management Review, 49(4), 112–131.
Burnett, K. (1992). Relationship fundraising. London: White Lion Press.
Carolei, D. (2018). How is Oxfam being held accountable over the Haiti scandal? British Politics and Policy at LSE. http://eprints.lse.ac.uk/89096/1/politicsandpolicy-how-is-oxfam-being-held-accountable-over-the-haiti.pdf. Accessed 3 July 2018.
Cave, J. (2016). A shifting sector: Emerging trends for Canada’s nonprofits in 2016. The Philanthropist. http://thephilanthropist.ca/2016/01/a-shifting-sector-emerging-trends-for-canadas-nonprofits-in-2016/. Accessed 2 Dec 2017.
Charities Aid Foundation. (2018). CAF UK Giving 2018: An overview of charitable giving in the UK [PDF document]. Kent. https://www.cafonline.org/docs/default-source/about-us-publications/caf-uk-giving-2018-report.pdf. Accessed 6 July 2018
Clarke, L., & Carroll, L. E. (2016). Sociological and economic theories of markets and nonprofits: Evidence from home health organizations. American Journal of Sociology, 97(4), 945–969.
Cnaan, R., Jones, K., Dickin, A., & Salomon, M. (2011). Nonprofit watchdogs: Do they serve the average donor? Nonprofit Management & Leadership, 21(4), 381–397. https://doi.org/10.1002/nml.20032.
Coleman, J. S. (1990). Foundations of social theory. Cambridge: Harvard University Press.
Cooley, A., & Ron, J. (2002). The NGO scramble: Organizational insecurity and the political economy of transnational action. International Security, 27(1), 5–39.
Cornwall, A., Lucas, H., & Pasteur, K. (2000). Introduction: Accountability through participation—Developing workable partnership models in the health sector. Institute of Development Studies Bulletin, 31(1), 1–13.
Coyne, A. (2017). Take the politics out of charity? Far better to just cancel the tax break. National Post. http://nationalpost.com/opinion/andrew-coyne-take-the-politics-out-of-charity-far-better-to-just-cancel-the-tax-break. Accessed 14 Mar 2017.
DiMaggio, P. J., & Anheier, H. K. (1990). The sociology of nonprofit organizations and sectors. Annual Review of Sociology, 16, 137–159.
Donovan, K. (2007). Charity scams bust public trust. The Star. https://www.thestar.com/news/investigations/2007/06/02/charity_scams_bust_public_trust.html. Accessed 10 July 2017.
Dumont, G. E. (2013). Transparency or accountability? The purpose of online technologies for nonprofits. International Review of Public Administration, 18(3), 7–29. https://doi.org/10.1080/12294659.2013.10805261.
Ebrahim, A. (2003). Accountability in practice: Mechanisms for NGOs. World Development, 31(5), 813–829. https://doi.org/10.1016/S0305-750X(03)00014-7.
Ebrahim, A. (2005). Accountability Myopia: Losing sight of organizational learning. Nonprofit and Voluntary Sector Quarterly, 34(1), 56–87. https://doi.org/10.1177/0899764004269430.
Ebrahim, A., & Weisband, E. (Eds.). (2007). Global accountabilities: Participation, pluralism, and public ethics. Cambridge: Cambridge University Press.
Edwards, M., & Hulme, D. (1996). Too close for comfort? The impact of official aid on nongovernmental organizations. World Development, 24(6), 961–973.
Emmett, B., & Emmett, G. (2015). Charities in Canada as an Economic Sector [PDF document]. Toronto, CA. http://www.imaginecanada.ca/sites/default/files/imaginecanada_charities_in_canada_as_an_economic_sector_2015-06-22.pdf. Accessed 5 June 2017.
Frumkin, P. (2002). On being nonprofit: A conceptual and policy primer. Cambridge: Harvard University Press.
Furneaux, C., & Wymer, W. (2015). Public trust in Australian charities: Accounting for cause and effect. Third Sector Review, 21(2), 99–127.
Gaskin, K. (1999). Blurred vision: Public trust in charities. International Journal of Nonprofit and Voluntary Sector Marketing, 4(2), 163–178. https://doi.org/10.1002/nvsm.66.
Giving USA. (2017). The Annual Report on Philanthropy for the Year 2016. Chicago: Giving USA Foundation.
Grønbjerg, K. A. (2009). Are nonprofits trustworthy? Bloomington: Indiana Nonprofit Sector: Scope and Community Dimensions. https://pdfs.semanticscholar.org/8f49/b7cd608b841af771989b8707b73d4f0cbf32.pdf. Accessed 25 June 2017.
Grønbjerg, K. A., McGiverin-Bohan, K., Gallagher, A., Dula, L., & Miller, R. (2016). Briefing series: Indiana government officials and trust in nonprofits. Bloomington: Indiana Nonprofit Sector: Scope and Community Dimensions.
Hager, M. A., & Hedberg, E. C. (2016). Institutional trust, sector confidence, and charitable giving. Journal of Nonprofit & Public Sector Marketing, 28(2), 164–184.
Hale, K. (2013). Understanding nonprofit transparency: The limits of formal regulation in the american nonprofit sector. International Review of Public Administration, 18(3), 31–49. https://doi.org/10.1080/12294659.2013.10805262.
Hall, M. H., Barr, C. W., Easwaramoorthy, M., Sokolowski, S. W., & Salamon, L. M. (2005). The Canadian Nonprofit and Voluntary Sector in Comparative Perspective [PDF document]. Toronto: Imagine Canada. http://sectorsource.ca/sites/default/files/resources/files/jhu_report_en.pdf. Accessed 24 June 2017.
Handy, F. (1997). Co-existence of nonprofits, for profits, and public sector institutions. Annals of Public and Cooperative Economics, 68(2), 201–223.
Handy, F. (2000). How we beg: The analysis of direct mail appeals. Nonprofit and Voluntary Sector Quarterly, 29(3), 439–454.
Handy, F., Seto, S., Wakaruk, A., Mersey, B., Mejia, A., & Copeland, L. (2010). The discerning consumer: Is nonprofit status a factor? Nonprofit and Voluntary Sector Quarterly, 39(5), 866–883. https://doi.org/10.1177/0899764010362113.
Hansmann, H. B. (1980). The role of nonprofit enterprise. The Yale Law Journal, 89(5), 835–901. https://doi.org/10.2307/796089.
Hansmann, H. (1996). The ownership of enterprise. Cambridge, MA: The Belknap Press.
Herzlinger, R. E. (1996). Can public trust in nonprofits and governments be restored? Harvard Business Review, 74(2), 97–107.
Hillier, A. (2018). Oxfam: A crisis to end all crises. Third Sector. https://www.thirdsector.co.uk/oxfam-crisis-end-crises/communications/article/1459831. Accessed 10 July 2018.
Hyndman, N., & McConville, D. (2016). Transparency in reporting on charities’ efficiency: A framework for analysis. Nonprofit and Voluntary Sector Quarterlyn, 45(4), 844–865. https://doi.org/10.1177/0899764015603205.
Imagine Canada. (2010). Bill C-470: Twelve frequently asked questions [PDF document]. Toronto, CA: Imagine Canada. http://www.imaginecanada.ca/sites/default/files/c-470_top12_faq_en.pdf. Accessed 4 Feb 2017.
Independent Sector. (2016). United for charity: How Americans trust and value the charitable sector [PDF document]. https://www.independentsector.org/wp-content/uploads/2016/10/United-for-Charity-v5.pdf. Accessed 9 June 2017.
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305–360.
Kearns, K. (1994). The strategic management of accountability in nonprofit organizations: An analytical framework. Public Administration Review, 54(2), 185–192. https://doi.org/10.2307/976528.
Keating, E. K., & Frumkin, P. (2003). Reengineering nonprofit financial accountability: Toward a more reliable foundation for regulation. Public Administration Review, 63(1), 3–15. https://doi.org/10.1111/1540-6210.00260.
Keirouz, K. S. (1998). Public perceptions and confidence in Indiana nonprofit organizations. Indianapolis: Indiana University Center of Philanthropy.
Kissane, R. J. (2003). What’s need got to do with it? Barriers to use of nonprofit social services. Journal of Sociology and Social Welfare, 30(2), 127–148. https://doi.org/10.1023/A:1016565426011.
Kissane, R. J. (2010). The client perspective on nonprofit social service organizations. Journal of Policy Analysis and Management, 29(3), 632–637. https://doi.org/10.1002/pam.
Kline, R. B (2011). Principles and practice of structural equation modelling (3rd ed.). New York: Guilford Press.
Koppell, J. G. S. (2005). Pathologies of accountability: ICANN and the challenge of “multiple accountabilities disorder”. Public Administration Review, 65(1), 94–108. https://doi.org/10.1111/j.1540-6210.2005.00434.x.
Kramer, R. M. (2000). A third sector in the third millennium? VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 11(1), 1–23.
Lasby, D., & Barr, C. (2013). Talking about charities 2013: Canadians’ opinions on charities and issues affecting charities [PDF document]. Edmonton. https://www.muttart.org/wp-content/uploads/2015/11/3.-Talking-About-Charities-Full-Report-2013.pdf. Accessed 18 June 2017.
Lasby, D., & Barr, C. (2015). Giving in Canada: Strong philanthropic traditions supporting a large nonprofit sector. In P. Wiepking & F. Handy (Eds.), The Palgrave handbook of global philanthropy (1st ed., pp. 25–43). London: Palgrave Macmillan.
Light, P. C. (2008). How Americans view charities: A report on charitable confidence, 2008 [PDF document]. Washington, DC. https://wagner.nyu.edu/files/faculty/publications/04_nonprofits_light.pdf. Accessed 2 Dec 2017.
McDougle, L. (2014). Understanding public awareness of nonprofit organizations: Exploring the awareness–confidence relationship. International Journal of Nonprofit and Voluntary Sector Marketing, 19(3), 187–199. https://doi.org/10.1002/nvsm.
McDougle, L., & Handy, F. (2014). The influence of information costs on donor decision making. Nonprofit Management and Leadership, 24(4), 465–485. https://doi.org/10.1002/nml.21105.
McDougle, L., & Lam, M. (2014). Individual and community-level determinants of public attitudes toward nonprofit organizations. Nonprofit and Voluntary Sector Quarterly, 43(4), 672–692. https://doi.org/10.1177/0899764013479830.
Muthén, L. K., & Muthén, B. O. (1998–2012). Mplus user’s guide (7th edn.). Los Angeles: Muthén and Muthén.
Newport, F. (2017). Americans’ confidence in institutions edges up. Gallup. https://news.gallup.com/poll/212840/americans-confidence-institutions-edges.aspx. Accessed 7 July 2018.
Nye, J. S., Zelikow, P. D., & King, D. C. (Eds.). (1997). Why people don’t trust government. Cambridge: Harvard University Press.
O’Neill, M. (2009). Public confidence in charitable nonprofits. Nonprofit and Voluntary Sector Quarterly, 38(2), 237–269. https://doi.org/10.1177/0899764008326895.
Prakash, A., & Gugerty, M. K. (2010). Trust but verify? Voluntary regulation programs in the nonprofit sector. Regulation and Governance, 4(1), 22–47. https://doi.org/10.1111/j.1748-5991.2009.01067.x.
Putnam, R. D. (2000). Bowling alone: The collapse and revival of American community. New York: Simon & Schuster.
Ries, T. E., Bershoff, D. M., Adkins, S., Armstrong, C., & Bruening, J. (2018). 2018 Edelman Trust Barometer Trust Barometer: Global Report [PDF document]. New York. https://cms.edelman.com/sites/default/files/2018-01/2018%20Edelman%20Trust%20Barometer%20Global%20Report.pdf. Accessed 10 July 2018.
Rimington, J. (2018). Five tips to avoid a scandal like Oxfam Great Britain’s. Stanford Social Innovation Review. https://ssir.org/articles/entry/five_tips_to_avoid_a_scandal_like_oxfam_great_britain. Accessed 9 July 2018.
Rutley, R., & Stephens, I. (2017). Public Trust And Confidence in Australian Charities. http://www.acnc.gov.au/ACNC/Publications/Reports/Public_Trust_2017.aspx.
Salamon, L. M. (2012). The resilient sector. In L. M. Salamon (Ed.), The state of nonprofit America. (2nd ed., pp. 3–88) Washington, DC: Brookings Institution.
Sargeant, A. (1999). Charitable giving: towards a model of donor behaviour. Journal of Marketing Management, 15(4), 215–238. https://doi.org/10.1362/026725799784870351.
Sargeant, A., & Lee, S. (2002). Individual and contextual antecedents of donor trust in the voluntary sector. Journal of Marketing Management, 18(7–8), 779–802. https://doi.org/10.1362/0267257022780679.
Sargeant, A., & Lee, S. (2004). Donor trust and relationship commitment in the U.K. charity sector: The impact on behavior. Nonprofit and Voluntary Sector Quarterly, 33(2), 185–202. https://doi.org/10.1177/0899764004263321.
Saxton, J. (1995). A strong charity brand comes from strong beliefs and values. Journal of Brand Management, 2(4), 211–220.
Saxton, J. (2004). Editorial: The Achilles’ Heel of modern nonprofits is not public “trust and confidence” but public understanding of 21st century charities. International Journal of Nonprofit and Voluntary Sector Marketing, 9(3), 188–190. https://doi.org/10.1002/nvsm.246.
Schatteman, A. (2013). Nonprofit accountability: To whom and for what? An introduction to the Special Issue. International Review of Public Administration, 18(3), 1–6. https://doi.org/10.1080/12294659.2013.10805260.
Schlesinger, M., Mitchell, S., & Gray, B. H. (2004). Restoring public legitimacy to the nonprofit sector: A survey experiment using descriptions of nonprofit ownership. Nonprofit and Voluntary Sector Quarterly, 33(4), 673–710. https://doi.org/10.1177/0899764004269431.
Schmitz, H. P., Raggo, P., & Bruno-van Vijfeijken, T. (2011). Accountability of transnational NGOs: Aspirations versus practice. Nonprofit and Voluntary Sector Quarterly, 41(6), 1175–1194. https://doi.org/10.1177/0899764011431165.
Shier, M. L., & Handy, F. (2013). Understanding online donor behavior: the role of donor characteristics, perceptions of the internet, website and program, and influence from social networks. International Journal of Nonprofit & Voluntary Sector Marketing, 17(3), 219–230. https://doi.org/10.1002/nvsm.1425.
Sisco, H. F., Collins, E. L., & Zoch, L. M. (2010). Through the looking glass: A decade of Red Cross crisis response and situational crisis communication theory. Public Relations Review, 36(1), 21–27.
Sloan, M. F. (2009). The effects of nonprofit accountability ratings on donor behavior. Nonprofit and Voluntary Sector Quarterly, 38(2), 220–236. https://doi.org/10.1177/0899764008316470.
Smith, S. R., & Lipsky, M. (1993). Nonprofits for hire: The welfare state in the age of contracting. Cambridge, MA: Harvard University Press.
Tremblay-Boire, J., & Prakash, A. (2014). Accountability.org: Online disclosures by U.S. Nonprofits. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(2), 693–719. https://doi.org/10.1007/s11266-014-9452-3.
Turcotte, M. (2015). Volunteering and charitable giving in Canada [PDF document]. http://www.statcan.gc.ca/pub/89-652-x/89-652-x2015001-eng.pdf. Accessed 25 June 2017.
Weisbrod, B. A. (1998). The nonprofit mission and its financing. Journal of Policy Analysis and Management, 17(2), 165–174.
Williams, A. P., & Taylor, J. A. (2013). Resolving accountability ambiguity in nonprofit organizations. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 24(3), 559–580. https://doi.org/10.1007/s11266-012-9266-0.
Wilson, M., & Hegarty, N. (1997). Public perceptions of nonprofit organizations in Michigan. Lansing: Institute for Public Policy and Social Research.
We are grateful to have this data which were made available to us by generosity of the Muttart Foundation (Canada) and Imagine Canada. The authors are very grateful to the Muttart Foundation and Imagine Canada for the use of their 2013 dataset.
Conflict of interest
The authors declare that they have no conflict of interest.
About this article
Cite this article
Farwell, M.M., Shier, M.L. & Handy, F. Explaining Trust in Canadian Charities: The Influence of Public Perceptions of Accountability, Transparency, Familiarity and Institutional Trust. Voluntas 30, 768–782 (2019). https://doi.org/10.1007/s11266-018-00046-8