The share of donors who say trust is an important factor in their charitable giving is declining, according to a new study released Monday from the Better Business Bureau’s Give.org charity evaluation site.
The study, the latest edition of Giving.org’s Donor Trust Report, found the proportion of donors who say trust is of “high importance” before making a donation declined from 73 percent in 2017 to 64 percent in 2020. The results are based on surveys conducted in March and August 2020 and December 2019, with the report framing many of its findings against results from similar surveys conducted in 2017. Together, the 2019 and 2020 surveys had more than 3,100 respondents, with margins of error of 2 to 3 percent.
The survey also found individuals who say trust in a charity is highly important are more likely to donate than those who assign low importance to trust in charities; 53 percent of respondents who say trust is highly important gave more than $200 to a charity in 2019, compared with 39 percent of those who said it was not as important.
Further, donors are giving less weight to a charity’s financial ratios as a “trust signal.” In 2017, 35 percent of respondents said the ratio of a charity’s spending on providing services to its overall spending was an important signal of a charity’s trustworthiness. In 2020, only about 19 percent held the same opinion.
According to Elvia Castro, manager of regional charity reporting for the Better Business Bureau’s Wise Giving Alliance, potential donors may be affected by a growing distrust in institutions in general. She noted the Edeleman Trust Barometer, a series of annual reports measuring trust in institutions of all kinds across the globe, has been charting a persistent rise in distrust of institutions over the past decade. In 2017, 47 percent of global respondents to the Edelman survey reported distrust in institutions. In 2020, it had grown to 52 percent.
“It’s a broader societal effect that we think is trickling into the charitable sector,” said Castro. “It isn’t driven by something charities are doing or not doing, but it is affecting the sector.”
Similarly, fewer respondents in 2020 assigned high importance to “accomplishments shared by the organization” as a sign of trust than in previous years. In 2017, 44 percent of respondents said these self-shared accomplishments were of high importance when assessing trust. In 2020, that dropped to 30 percent. It’s also a relatively recent shift. In December 2019, 50 percent of respondents said this was a highly important signal of trust, followed by third-party evaluations, at 32 percent.
Castro hypothesized the pandemic has so upturned people’s daily lives that they are looking for different trust signals. “A lot of messaging for a charity will be how they’re directly impacted within Covid-19 efforts, or they might speak to how their costs are affected by the larger Covid-19 issue,” said Castro.
Third-party evaluations, at 36 percent, and name recognition were the most commonly selected highly important trust signals for respondents to the August 2020 survey.
The report also sheds light on how giving attitudes have shifted since the onset of the pandemic. Notably, surveys from December and August show big changes in respondents’ desire to increase their volunteering and their giving directly to individuals in need. In December 2019, 22 percent of respondents said they would like to increase their giving to individuals in need directly through crowdfunding websites. In August 2020, that had declined to 10 percent. Likewise, the proportion of respondents who said they wanted to increase their volunteering dropped from 41 percent to 16 percent.
Castro said it’s likely that Covid-related safety concerns are behind the decreased interest in volunteering. “People have to be extra careful, and they’re only going to do it in certain settings,” she said.
Castro said the results about giving directly to individuals were surprising. Anecdotally, at least, giving directly to individuals through crowdfunding sites is becoming more common, creating competition for traditional nonprofits. But Castro hypothesized crowdfunding donations are hard to plan for, and donors rarely allocate money for these appeals.
“My personal conclusion is crowdfunding is more of an impulsive give, more of an emotional gift,” said Castro. “It happens more because they see someone who they just must help, and they jump at it.”
Meanwhile, the share of respondents who want to increase their support for “good business or social enterprise ventures” rose from 5 percent to 20 percent from December to August, while the share who want to increase direct giving to family and friends rose from 17 percent to 28 percent in that time.
