2023 Reflections on Philanthropy: Overcoming the Trust Gap

At the end of every year, I ask myself the same question: Is the world in a better place than it was a year ago? Sadly, events happening around the globe suggest otherwise. And it’s likely that discouraging trends will continue.

Poverty, hunger, homelessness and the devastating effects of war will continue to inflict damage on populations around the world. At the same time, the wealth gap will likely continue to expand, creating more millionaires and billionaires than ever before.

For me, this is why the work of philanthropy and nonprofits is so critically important. Our role is to serve the common good – to help those caught in the middle or at the bottom by accessing resources and wealth that have been created over generations.

Nonprofits often measure their success by the funds they secure through government grants, individual donors and corporate partners. While these funds are vitally important, I wonder if we spend enough time measuring the impact of how we use those resources.

According to Independent Sector’s 2023 Health of the U.S. Nonprofit Sector Annual Review, 52% of the U.S. public said they trusted nonprofits in 2023. While those results are discouraging, it’s even more startling that the number dropped 7% from 2020.

Why this level of growing distrust? One related reason could be a growing skepticism of traditional organizations that we see elsewhere, such as political parties, government institutions and religious entities.

Some donors tell me it stems from what they perceive as a lack of progress. Why should they fund programs if the organization isn’t moving the needle? Others cite too many organizations with similar missions – they want to see more collaboration. Others say it’s donor fatigue, especially coming out of the COVID pandemic, as the same people get asked to do more and more each year.

Ultimately, I believe it’s a combination of all these reasons, and then some.

As the year winds down, we at The Vella Group are taking these developments to heart. We’re looking long and hard at how we use our resources to collaborate with our partners and drive maximum impact. While funds raised will continue to serve as an important metric, our focus will be to help translate how those efforts are truly making a difference. And if there isn’t impact, we’ll question why we are spending the resources. In some cases, tough questions and tough answers will be needed.

No one knows what 2024 will bring or if we’ll be in a better place a year from now – globally or personally. But we can’t lose hope. Nonprofit work is critical, but it’s time to reflect and take stock. As donors re-evaluate where they spend their energy and resources, nonprofits need to do the same, placing greater emphasis on demonstrating impact to further their vital missions.

Wishing you all peace and good health and a happy holiday season.