The Authentic Organization

I learned how to behave properly at an adult dinner table at a pretty young age. But when I moved to the United States at the age of 13, I discovered that some American families have very different rules of conversation than those I had become familiar with in Europe. All the topics that I had come to know as the core of intelligent conversation were off limits: religion, politics, intimate relations, and money — especially money.

Some organizations are like this. Even if they are open about one or more of the first three of these, they often have cultures of discomfort about money (even in donor relations, as I’ve explored a bit before). Indeed, with policies restricting information about salaries, it can go much further than culture.

There are a few factors that limit the ability of some organizations to be secretive about salaries. In many countries, larger nonprofits have to report certain salaries to regulatory authorities. Other channels exist to reveal the salaries of executives in major corporations. But mostly, it’s up to the organizations to decide.

Management sets the tone when it comes to transparency about salaries. Because salaries tend to be negotiated up rather than down, management will often seek to keep salaries secret in order to strengthen their negotiating position. It’s tough to balance a rational salary policy against fluctuating labor markets and the vagaries of individual hiring decisions.

And yet, I think this sort of secrecy is fundamentally corrosive. Salaries are important to people, very important. If people can’t talk about something that important, then what other important things can’t they talk about?

This points out a key implication about authenticity in organizations: Authenticity demands that we abandon many deeply entrenched habits of using the control of information to gain power. It’s not possible to step onto the road toward authenticity without also accepting that the destination will involve new power relations.

From my perspective, that’s a wonderful thing. Let’s start with salaries.