Self-moderation refers to members taking a step back and evaluating their environment and their own behavior and then taking steps to either correct their behavior or remove themselves from an environment that isn't good for them.
A member is in the #multishipping channel and a ship comes up that they do not like. Instead of telling everyone that that ship is a squick for them, they should instead self-moderate and move to another area of the server until the discussion has moved on. The discussion of the ship in question is within the rules of the room and other members are enjoying the discussion. It is the responsibility of the member who is bothered by said ship to remove themselves from the channel. The members discussing their ship can enjoy their conversation in peace, and squicked member doesn't have to read it. Everyone wins!