Should our salaries be public? For Asian startups, it’s a question of culture

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This is a Discuss post, where we feature short but insightful opinions from the Asian tech community on startup, entrepreneurship, and tech topics.

“How much do you earn?” If you’ve never heard that question thrown around a networking event, it’s because, as much as we’ve progressed, we still skirt around the mere mention of our salaries.

But there’s been discussion in startup circles to have full salary disclosure. This could mean allowing employees to freely discuss their salaries or a company making all salaries available for viewing.

What are the benefits and drawbacks of this? Would it even work? We asked two startup founders to share their thoughts.

Editor’s note: Answers have been edited for clarity.

Filbert Richerd Ng Tsai, founder of UpSmart Strategy Consulting

Open compensation schemes are definitely one of the things that we’re looking into adopting to promote a better culture of transparency within the firm. As a management consultancy firm, I do find it a bit tricky to adopt such a radical approach to transparency since it can cause some unnecessary discomfort within the team.

But adopting an open compensation scheme can definitely help in ensuring fair compensation is provided to every employee, which can help curb the C-suite pay dilemma that many corporations are facing. However, there is still a massive barrier since such a practice will require:

• Management teams to communicate more with employees on how their individual compensation is determined
• Employees to agree to share their compensation details to other employees
• Breaking open the taboo topic of how much people are earning

I am leaning toward modifying the degree of compensation disclosure to ensure that individual compensation is still kept confidential. This would entail us:

• Disclosing a compensation formula that considers position, experience, and performance to let employees know how their compensation is determined
• Discussing with employees individually how profit share, bonuses, and compensation are determined based on the performance of the firm

We have already been practicing full transparency when it comes to internal financials, which would provide employees instant access to our firm’s performance. This motivates everyone in the team to contribute to the performance of the company (which will eventually go into the profit share pool).

Let’s discuss