Why People Don’t Trust Charities
Few sectors attract as much public suspicion as charities. Everyone has heard the following phrases, “They do not actually do anything”, “They steal all the money they get” etc.. For a sector built on goodwill, that level of distrust is quite damaging.
So why has this narrative taken hold? Are charities really as corrupt or ineffective as people believe?
As someone who has worked closely with charities, donors, and funders, the answer is more complex than a simple yes or no.
Where the Distrust Comes From
1. High-profile scandals shape public perception
Public trust in charities tends to be fragile, given charities role of doing good, people put charities on a pedestal as the spirit of virtue. Therefore, scandals, even rare ones, have an outsized impact. When a charity is exposed for misusing funds, paying excessive salaries, or failing to deliver promised outcomes, it becomes an enormous disturbance. This then makes it so more people have heard of the huge scandal than the good charities are doing and because of this, the scandal becomes a reference point for all charities in the public imagination.
One bad actor can taint thousands of legitimate organizations. People rarely remember the quiet success stories, but they remember the scandals vividly.
While there are many charities that do what they promise and deliver the work, that is a less luring headline than a big scandal.
The Role of Media and Social Narratives
Stories about corruption spread faster than stories about gradual progress. A viral post claiming “this charity stole millions” will always outperform a report showing a 10% improvement in literacy rates over five years. This dynamic encourages media outlets , which benefit from high engagement, to spotlight stories about charities misusing funds, knowing these narratives attract the most clicks and attention.
Given that charities are established to address poverty, inequality, and conflict, complex issues that cannot be resolved within months, they cannot produce the same eye-catching headlines because that simply isn’t realistic. Many charities are cautious, jargon-heavy, and risk-averse, which makes their work harder to understand and leaves them vulnerable to mistrust.
2. Confusion about “overhead” and administrative costs
One of the most common accusations is that charities “spend everything on admin,” a claim that usually stems from a misunderstanding of how organizations actually function. Running a charity requires skilled staff, reliable financial systems and audits, safeguarding measures, legal compliance, reporting, and the ability to monitor and evaluate impact over time. These costs are not waste; they are what allow a charity to operate responsibly and protect both the people it serves and the funds entrusted to it. Yet many donors expect their money to go directly to beneficiaries, with little tolerance for the infrastructure that makes that delivery possible. In reality, just like any institution or business, charities need systems and people in place to ensure work is done properly and ethically. A useful way to think about this is to imagine a house on fire: one person with a bottle of water cannot put it out, and even a thousand people with bottles still would not succeed. But if those same thousand people invest in building and staffing a fire station, they create a system capable of responding effectively. Administration in charities serves the same purpose, it turns goodwill into real, sustained impact.
While it is often believed that the charities with the least overhead are the best, underfunding admin can increase the risk of mismanagement. This is because it removes the systems and people that are meant to prevent mistakes, misuse, and fraud. When charities are pressured to keep overhead artificially low, they cut back on finance staff, audits, internal controls, training, and oversight. This leads to poor record-keeping, lack of separation of duties, weak monitoring of partners, and delayed detection of problems. Even well-intentioned organizations can lose control of funds simply because no one is resourced to track spending properly, challenge irregularities, or intervene early when something goes wrong.
In 2010, the Central Asia Institute, collapsed after investigations found widespread financial mismanagement. The organization spent large sums on the founder’s personal expenses and had weak accounting systems, minimal oversight, and poor governance. One reason this persisted for years was that administrative controls were severely underfunded and informal, with little financial scrutiny or independent auditing. The scandal did not emerge because the charity spent too much on admin, but because it spent too little on the systems that would have detected and prevented misuse earlier.
The Bigger Picture
The industry has made so much progress over the past few decades, charities have helped drive historic improvements in human wellbeing. Global extreme poverty has fallen dramatically compared to the late 20th century. Child mortality rates have been cut by more than half. Access to clean drinking water, basic education, and life-saving vaccines has expanded to hundreds of millions of people, often through partnerships between charities, governments, and local organizations.
Charities have also become far more professional and evidence-driven than they once were. Many now use rigorous monitoring and evaluation frameworks, independent audits, and data-led decision-making to understand what works and what doesn’t. Entire fields, from global health to disaster response, have evolved because charities tested approaches, learned from failure, and scaled what proved effective.
The sector has also shifted away from purely transactional aid toward long-term capacity building. Instead of just delivering services, many charities now invest in local leadership, strengthen community institutions, support policy change, and work to address root causes rather than symptoms. This kind of progress is slower and less visible, but far more durable.
Transparency and accountability have improved as well. Financial reporting standards are higher, impact reporting is more common, and public scrutiny is stronger than ever. While this scrutiny can feel hostile at times, it has pushed the sector to raise its standards and confront uncomfortable truths.
Why It Feels Like Money Disappears
From a donor’s perspective, it often feels like money disappears into a black box: a donation is made, a thank-you email arrives, and then there is silence. When impact reporting is overly technical, language is vague (“supporting communities,” “empowering change”), and results take years rather than months, people naturally fill the gaps with suspicion and assume nothing meaningful happened at all. Real trust, however, isn’t built through reassurance or branding, it’s built through transparency. That means clearly showing where the money goes in plain language, explaining not only what worked but what didn’t, being explicit about who makes decisions, how partners are chosen and monitored, and what success actually looks like. This is the gap Giving for the Living is designed to address by collaborating with the charities people already know and trust, and supporting them with the guidance and structure needed to become more transparent. In practice, this happens through a milestone-based framework that breaks each project down into clear, deliverable stages, showing exactly what needs to be done, when it will be done, and how much each part costs, so donors can follow their contribution from intention to impact.
