Rebuilding networks, social capital key for nonprofit organizations

Charities and nonprofit organizations will need to develop stronger ties with their supporters because of the COVID-19 pandemic, according to a Grand Valley professor. 

The pandemic challenged charities and nonprofit organizations in an unprecedented fashion, forcing them to strategize virtual ways in connecting with donors online, said Salvatore Alaimo, associate professor of nonprofit management, within the School of Public, Nonprofit, and Health Administration.

However, Alaimo said charitable organizations rely on the social capital of networking, relationships, trust and reciprocity that they build and maintain with supporters. 

“This social capital feeds into whether people donate, whether they decide to volunteer their precious, expendable time or whether they want to serve on the board of your organization,” said Alaimo. 

The holiday season usually means an increase in donations to charities and nonprofits, and after nearly two years of pandemic restrictions limiting in-person gatherings and events, this season is even more important.

Giving USA’s 2021 annual report stated Americans responded by donating more than $471 billion to charities and nonprofits in 2020, a 5.1 percent increase over 2019. Foundation giving also increased to more than $16 billion in 2020, a 19 percent increase over 2019.

According to the Urban Institute, about 1.5 million charitable organizations function in the United States. While charitable giving has increased, Alaimo believes they will face long-term ramifications due to the challenging times.  

“For nonprofits, it’s going to be an adjustment of priorities,” said Alaimo. “Staff leadership and boards of directors will have to go back to basics. Who’s the audience they are trying to reach, who are the stakeholders, and how do they maintain relationships if we’re being kept separate from each other.”

More than 80 percent of nonprofits have budgets less than $500,000, so they faced challenges even before the pandemic, said Alaimo.

In-person events are integral to forming connections between supporters and the nonprofit, said Alaimo. But, with the pandemic limiting in-person functions, charities resorted to a myriad of virtual events.

Auctions, fun runs and even golf outings moved online, making those all-important connections difficult to maintain. For all the good technology did to ease the logistics of fundraising, it still created separations between organizations and supporters, said Alaimo.

“As I remind my students, just because we are electronically networked does not mean we are good at networking,” said Alaimo. “Now that COVID has come along, the isolation factor of technology is amplified. My concern is all of that is going to put a dent into social capital, and that’s not going to bode well for nonprofits.”

When it comes to selecting nonprofits that are reputable and allocate money efficiently, Alaimo said there are several websites and databases to help such as GuideStar, Charity Navigator or the Better Business Bureau.

WalletHub released its list of best charitable organizations for 2022. 

“The nonprofits that best form long-term relationships are going to be more fiscally viable and sustainable,” said Alaimo.