Fair, transparent, self-determined compensation –
The question of fair compensation in purpose-driven organizations is an evergreen. Many mission-led teams grapple with questions like: What does a fair salary look like? How much should—and can—you earn when working in service of the common good? How do salaries in purpose-driven companies compare to the broader market?
Because there’s no one-size-fits-all answer, we developed our own salary framework back in 2019. We’ve since fundamentally iterated on that process to make our organization more resilient and regenerative. Here, we’d like to share the result with you.
The core idea is this:
A salary process can never be “objectively” fair. The goal of the process is to minimize the sum of all subjectively perceived injustices.
Every full-time Diver* can (and should) submit a salary proposal that they consider appropriate for their own contribution.
To foster openness and facilitate peer-to-peer exchange, all salaries at TheDive are visible to every full-time Diver* within the organization. This includes the submitted salary proposals.
It’s clear: some roles in a company come with more responsibility, others with less—and salaries should reflect that. At the same time, no one should feel disadvantaged, which is why the gap between the lowest and highest salary may not exceed a factor of 5
If someone’s idea of an appropriate salary changes—say, because they’ve taken on significantly more responsibility in a short time or their personal circumstances have shifted—they can make this “tension” visible and submit a corresponding proposal. This allows us, as an organization, to respond to unforeseen developments at any time.
A “tension holder” nominates two people—based on close collaboration or complementary perspectives—to review the proposal and provide feedback: one from within their own circle and one from outside. Together with the newly established role of Circle Economist, they form an effective, holistic, and resilient review body, making the organization’s salary-setting process more co-creative.
Anyone submitting a proposal is asked to justify their requested change from three perspectives:
- Individual perspective: Why should I earn more? What contributions am I making that justify my salary request?
- Immediate circle perspective: Who in the organization can I reasonably compare myself to, and what insights does that provide about our salaries?
- Organizational perspective: What is TheDive’s overall financial situation?
Additionally, the decision should take into account different streams of contribution, in line with our value-creation accounting approach. The process is overseen by the Compensation Strategist role.
Proposals are kept concise, with a one-page template in place to limit the effort required from everyone involved. Submitting a salary proposal should not be a bureaucratic hurdle. Guidance is provided through narrowly defined salary bands to ensure better comparability.
Anyone who has read our article New Finance on the previous pages won’t be surprised that, as part of the new process, we’ve also moved away from the concept of a salary budget. We believe this principle is incompatible with the requirements of a life-centric organization. On one hand, its rigidity limits our flexibility and responsiveness; on the other, budget-driven management tends to overlook contributions that aren’t directly monetizable but are crucial for the (co-)evolution of the organization.
Through newly developed salary criteria, we can now make these streams of contribution visible, compare them, and incorporate them into the decision-making process. Here’s an excerpt from the questionnaire designed to help Diver* reflect on their performance and, in turn, their salary request:
Responsibility & Contribution
- What responsibilities do I hold within my home circle and at TheDive overall?
- How would I describe my contribution to the development of my home circle?
- How—and to what extent—do I contribute to the overall development of TheDive?
Expertise & Experience:
- What specific expertise and experience does my role (or roles) require?
- How much expertise do I already bring to the table?
- In which areas would I like/need to continue learning?
Performance & Achievements
- How well do I fulfill my roles and cover my responsibilities?
- Which milestones or interim goals have I achieved in recent months?
- Which projects have I completed? What is going well, and what is (still) not going so well?
- In which areas can I still improve?
- What have I already accomplished at TheDive, and what do I still want to achieve?
- If you hold a role in a BIZ circle: How much billable work have I delivered, and how do I assess it?
TheDive Culture
- To what extent do I take responsibility for my own tensions?
- How autonomously and proactively do I work in my roles (role autonomy)?
- How does my behavior contribute to transparent and trust-based collaboration?
- How well do I maintain awareness of my own balance?
Market Perspective
- Which organizations can TheDive be compared to, and what would a salary for comparable roles be in another organization?
- What could I earn in other organizations for comparable work?
Personal
- Which personal circumstances and goals shape or justify my salary request?
- Are there aspects that call for solidarity within the community?
This step is meant to examine and articulate your own tensions. It concludes with the decision of whether or not to submit a salary proposal.
The goal of this step is to write and submit a proposal. It is considered submitted once the document is in the correct location and the People Circle has been informed.
The feedback providers now have two weeks to give written feedback. Afterwards, the Circle Economist is involved. Based on the substantive feedback, they provide economic feedback on the salary proposal. This step is complete when all feedback forms have been fully submitted in the salary process folder..
Here, the proposer takes the lead again. They have access to all feedback via the salary process folder and have three options: leave the proposal as is, withdraw it, or adjust it.
At this stage, the proposer, the Circle Economist, and the Compensation Strategist decide on the new salary through objection integration. If there are no objections, this step—and thus the entire process—is complete. If objections exist, they are addressed through the consent process.
Why We Abolished the Lead Role
The Lead Role was previously the position where most leadership responsibilities were concentrated. Last year, we abolished it. More specifically, we distributed its leadership functions across three different roles.
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New things are constantly emerging at TheDive.
With our newsletter, you’ll stay up to date.