The Chartered Institute of Personnel and Development (CIPD), in its 2017 Reward Management Survey, stated that pay was becoming more transparent in most organisations.
The study showed that 69% of the 715 organisations surveyed were open about pay levels, with 31% favouring ‘great’ transparency in form of written policies. Similarly, in the 2016/17 HR/Reward Practices Survey conducted by KPMG Nigeria, 53% of employees believed that their companies’ performance management systems were more than fair.
Pay Transparency is a controversial concept with varying definitions across different bodies and organisations. Some define it using the literal word “transparency” and therefore interpret it as the act of revealing employee compensation information to other employees. Others interpret it as transparency of pay processes i.e. the process of being clear and open about compensation decisions, and providing all required information to understand these decisions. With the advent of technology and social media where people discuss and share all aspects of their lives, it is inevitable people will begin to seek platforms to share compensation information. It is important to note that there is no perfect level of pay transparency. As with other organisational decisions, it should be dependent on the organisational culture, brand strategy, goals, organisational philosophy, amongst other factors.
Click to download and read more on this article.
© 2019 KPMG Professional Services in Nigeria, a limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved.