Many non-profit experts agree that trust is a very important element in successfully running a non-profit organization. Organizations with a transparent culture are more likely to attract loyal employees while organizations that still make clandestine transactions part of their culture, attracts untrustworthy employees. Those employees are likely to jump ship when the going gets tough.
A report compiled by Deloitte reveals the following:
- 30% of American employees plan to look for a job when the economy turns around
- 48% of the group mentioned above cite a loss of trust in their employer as the reason, and
- 65% of Fortune 1000 executives believe trust will be a factor in voluntary employee turnover in the near future.
This report indicates that profit organizations spend billions to secure their consumer’s loyalty but fail in winning their employees’ trust. This extends to non-profit organizations that tend to focus more on training executives on Ethics and Integrity, but fail to implement them in their activities.
Tweet this: A non-profit organization with a tainted image will always struggle to raise funds
A non-profit organization with a tainted image will always struggle to raise funds as negative reports are hardly forgotten by people. An example of this is the recent Koin report on a non-profit executive who pleaded guilty to embezzling $200k from the Oregon Association for Career and Technical Education (OACTE), also known as Oregon ACTE Inc. She apparently had direct access to all OACTE’s financial records, bank accounts, PayPal account and purchase records. The embezzlement is reported to have happened in 2009 and investigators managed to find tangible evidence to charge her.
The investigation revealed that the accused and her husband used the stolen money for ATM withdrawals (cash), grocery purchases, vacation expenses, and paying personal bills.
There are many similar negative reports involving millions with some non-profit executive reportedly getting away scot-free. Such reports have caused donors to be cautious about who they fund.
Lack of trust has resulted in a delay in issuing NGO- certificates in other countries as vigorous checks have to be done.
Trust is important for securing funds
Tough economic times can force non-profit organizations to come up with alternative ways to raise g funds, sometimes even adopting profit-driven sector practices. An example of this is a non-profit gift shop that serves as a source for raising funds- this initiative is seen as a turnaround from charity work to making a profit.
NGOs should avoid running their organizations like profit-businesses and remember that theirs is a non-profit line. Donors trust organizations geared towards doing good with the little resources they have access to.
Unethical conduct erodes trust
Non-profit organizations are expected to follow a code of conduct that lays down all points of principle each employee should adhere to. The code of conduct is used to ensure that all activities are done in accordance with the non-profit’s standards.
Following a code of conduct builds trust. Donors and the bigger community will know that funds are handled by principled and trusted people.
Spending responsibly builds trust
It’s important for non-profit organizations to know how much their organization spends. This will not only enable them to spend within budget but also forecast future costs. A non-profit organization such as UNAIDS with a plan to provide access to medicine to all HIV-infected people by the year 2030, forces any NGO implementing this plan to spend funds responsibly.
Paper-based systems hamper responsible spending. These systems are mostly used for clandestine illegal activities, hence any non-profit still using a paper-based system cannot be fully trusted by donors.
Transparency has become a fundamental element when serving community needs. It’s the organization’s responsibility to cultivate transparency across all aspects of their organization.
Humentum believes that non-profit organizations should increase trust by keeping their risks low.
R Report fraud to a senior member of staff or board member
I Investigate all incidents to gather facts and evidence
S Secure assets and records
K Keep calm!
S Swiftly act
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