The effect of hybridisation processes on stakeholder trust in non-profit and hybrid organisations: How stakeholder trust is influenced by the integration of market practices in non-profit organisations

Abstract

Non-profit Organisations are faced with substantial challenges nowadays. They have significant social and environmental (SE) issues to address, but they are financially pressured to sustain themselves and diversify income strategies. When full for-profit organisations change their mission to address SE issues, they are oftentimes praised for it and benefit in direct and indirect ways, be it through positive publicity, increased market valuation and higher levels of public trust. However, when non-profit organisations diversify to include more market-oriented activities in their operations, consequences are not yet clear. External stakeholders can view this hybridisation as one more reason to trust these organisations, and in their ability to create positive change, or they can view it as a threat to the original SE mission, and lose trust. In this work, I explore the effect on trust, if any, and the direction (positive or negative) of such organisational moves, also known as hybridisation processes. To measure trust, a short version of Organisational Trust Inventory (OTI) questionnaire was used. The assessment of the construct Trust is described as a second-order reflective-formative construct by utilising PLS-SEM.