Guide to employee resource groups: The critical ins and outs

When you join a new company— whether in person or remotely— what’s the first thing you look for on day one? You may be sorting through administrative details, or getting an understanding of your responsibilities. 

It’s likely you’re also assessing who you’re working with. Who’s on your team; who’s the leader; where do you fit into it all?

We want to find belonging and community when we start a new job. And for many employees from underrepresented backgrounds finding colleagues similar to them is too often a challenge. 

That’s where employee resource groups come into play. Employees want to find community among others like them.

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What are employee resource groups?

Employee resource groups are voluntary, employee-organized communities that foster connections between employees that share similar interests, characteristics, or backgrounds. Most commonly, employees of similar ethnicities, gender identities, or sexual orientations form employee resource groups to give them a space to discuss their experiences at work. 

The different names for employee resource groups

Employee resource groups (ERGs) are also known as affinity groups, business resource groups, or business network groups. 

Employee resource groups are most commonly nested within Diversity, Equity and Inclusion initiatives within an organization. 

Affinity groups, on the other hand, commonly refer to communities outside the workplace of people with similar interests. In the 60s, for example, anti-war protesters would be referred to as an affinity group.

History of employee resource groups

Employees have been forming communities forever. But the term, “employee resource group” got its official start in 1970 with Joseph Wilson, the CEO of Xerox at the time. He supported black employees in launching the National Black Employees Caucus. 

Doing so gave employees a formal network within the company to discuss their experiences as black employees in a predominately white workplace. It also gave them the authority to advocate for changes within the company. 

The example of Xerox highlights the important role leaders play in empowering ERGs. We’ll talk more about this below.

Research into the history of ERGs has shown that there’s a shift in their purpose. In the past it was only about inclusion and supporting diversity. Now, however, studies highlight that “their purpose has transformed to include organizational challenges such as leadership development, innovation, and change management.” 

Different kinds of employee resource groups

There are several common ERG types in most organizations. For larger organizations with multiple locations and hundreds or even thousands of employees, there can be many. Siemens, for example, has 12 different ERGs employees can join. Some of their ERGs are unique while others fall into what is commonly seen.

Common types of employee resource group themes include:

• Culture or ethnicity
• People with disabilities
• Women
• Faith-based
• Gender identity minorities
• Sexual orientation minorities
• Age minorities
• Working parents, single parents and caregivers

There are other types of ERGs that are becoming more popular. . As ERGs have become more popular different types of groups have formed. They fall more into the category of affinity groups as they’re based on interests rather than characteristics. There are now companies with ERGs for employees interested in volunteering, climate advocacy, or workplace wellness.

Can a company have multiple employee resource groups?

Yes. Some companies can have multiple ERGs for different purposes. Some employees may participate in more than one as well. For example, a working mother may be part of an ERG for her and other working women while also participating in an ERG for African Americans.

How many companies have employee resource groups?

Studies who that over 90% of Fortune 500 companies have ERGs. Likewise, a 2011 Mercer report looking at 64 organizations found the average membership rate for ERGs to be around 8%. This may seem like a small amount, but for multinational companies with thousands of employees, 8% can be hundreds of employees. And ERGs most commonly exist for groups of employees that are in the minority compared to the rest of the organization.

How do employees benefit from joining an employee resource group?

The benefits of employee resource groups on employees include:

• Helping employees feel heard and included in the workplace. It cultivates a feeling of belonging or a sense of community within the organization.
• ERG members can support one another. Employees in ERGs share similar lived experiences and perspectives. In this way, they can provide helpful and relevant support for each other.
• Build employees' professional networks. Employees from underrepresented backgrounds can benefit from meeting other employees through ERGs. They can connect with leaders and pursue mentoring opportunities which lead to professional development.
• Gain visibility to opportunities. Because employees in ERGs can come from all levels of the organization, more junior team members can connect with leaders which will help them stand out for future opportunities for career development.
• Employees can communicate concerns and advocate for change to leaders more effectively. Employees have more of a voice when they’re together. Formal ERGs give employees from underrepresented groups a seat at the table.
• Promote understanding of different cultures. Employees who don’t come from an underrepresented group can gain new perspectives from participating in an ERG as an ally.

The strong business case for employee resource groups 

Organizations stand to benefit from having formal employee resource groups. But in the past, many didn’t recognize their value. The Wall Street Journal cites that critics have described ERGs as networking groups where employees “wine and whine.” 

As ERGs become more of a norm and support for them is more widespread, executives are recognizing the benefits. Numerous studies show how ERGs contribute to their strategic goals.

• 70% of organizations in a study highlighted by SHRM relied on their ERGs to build a workforce that reflected the demographics of their customer base. Likewise, almost 30% got assistance from their employee resource groups to increase the organization’s spend with diverse suppliers.
• In the same study, 90% of these companies leveraged ERG members to help onboard new employees. The first 90 days at a new job determine how likely they are to stay over the long haul. Being greeted and introduced to the company by someone like you can be the crucial differentiating factor.
• Nearly all respondents in a survey by Salesforce found that “ERGs boost company culture and champion DEI initiatives.”
• A study by the USC Marshall Center for Effective Organizations found that ERGs play a significant role in achieving diversity and inclusion initiatives. 

Examples of companies with employee resource groups

There are many companies with employee resource groups worth mentioning. At Together, we’ve worked with several organizations that have leveraged internal employee mentorship programs to expand the impact of their ERGs. We’ll highlight them below:

Avision Young (Commercial real estate)

Avison Young is a commercial real estate firm based in Canada. They have an employee resource group specifically for women. The goal of their ERG was to increase the representation of women in leadership positions. 

Through a mentoring program, they paired leaders with women in the ERG. They’d have discussions around their career goals and challenges. The leaders provided guidance and support in helping them advance their careers. They highlighted the impact of their ERG in a press release stating:

“As a result of [our employee resource group’s] focus on advancing women… Avison Young’s corporate leadership is now 40% women and 25% of its board are women.”

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King Games, a division of Activision (Video games)

King games created the popular game Candy Crush. Internal employee surveys revealed that non-male King employees felt they didn’t belong in a predominantly male industry and company. They had a lack of confidence in their ability to advance their careers because of their gender. In response, King launched several initiatives to support diversity and inclusion. 

Their primary initiative was a mentorship program called Kicking Glass. 

Over 250 non-male employees were paired with mentors who were leaders across the organization. The mentors gave them guidance and visibility for promotions. Another goal of their program was to drive more gender diversity among new hires. In 2018, they cited having only a third of new hires being women. After their program, they reached 40% and have continued to improve since. 

New York Life (Insurance)

New York Life is the third-largest life insurance company in the United States. They wanted to pair up members of their ERGs with leaders across their organization. Their Empower Program ran for 9 months, connecting ERG members with executives leading to open opportunities for them to grow and develop their careers. 

Mentors encouraged their mentees by sharing their professional stories and connecting them with others in their network. 

Their empower program successfully paired 53% of all ERG members with a mentor of the same background. For leaders not of the same backgrounds, the program gave them a fresh perspective and ERG members opportunities to have conversations around their experience in the workplace.

The importance of mentorship in employee resource groups

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The three examples of successful employee resource groups above all include mentoring programs. 

It shouldn’t be a surprise. Mentorship programs are an incredibly effective way to build supportive communities for diverse employees. 

Starting mentoring programs within ERGs, across different ERGs, or connecting ERG members with leaders provide several key benefits:

• ERG members can be paired with leaders in a reverse mentoring style. The ERG member exposes the leader to new perspectives, namely being an employee from an underrepresented background.
• ERG members get 1-on-1 development time with a mentor. This not only helps them build the skills to advance their careers, but it widens their professional network.
• Mentorship programs increase feelings of belonging. Employees in remote workplaces can often feel “cut off” from the rest of the organization. Having mentors who want to help them grow can significantly improve employees’ morale and engagement.

At Together, we see many companies launch diversity and inclusion mentoring programs to accelerate the impact of their employee resource groups. The impact is more meaningful employee connection, more advancement opportunities for diverse employees, and a culture that employees are proud to be a part of. If you’re thinking about starting a mentorship program to support diversity and ERG programs Together can make it easy to register employees, match them with mentors, support their relationships, and report on the program’s success.

The role of ERGs in diversity, equity and inclusion initiatives

A major misconception of ERGs is that they are tasked with “solving” issues related to diversity and inclusion in the workplace.

Frank Starling, the Founder of Variety Pack, a Diversity and Inclusion Consultancy describes in a Forbes article that “the burden of “solving Diversity and Inclusion (D&I)” [is placed] on the very groups that experience discrimination and racism in the workplace. These employees are left with the additional hours of work beyond their day jobs, planning and implementing D&I programming which can often cause burnout.”

Nichelle Grant, head of diversity and inclusion at Siemens USA shares in an HR Exchange Network webinar on ERGs the role they play in a business. She outlines that ERGs create an inclusive culture that permeates all areas of a business:

• Talent acquisition: Candidates are looking for areas where they can engage when considering a company they want to join.
• Onboarding: Employees from underrepresented backgrounds joining a company may be intimidated by a lack of representation. With an ERG, they can immediately plug into a supportive community of people like them. ERG members invite them to events, introduce them to colleagues, and get them engaged.
• Development: ERGs provide mentoring opportunities that accelerate the development of leadership skills and open doors to future opportunities.
• Performance management: Employees who participate in ERGs and the leaders who champion them should be recognized for their contributions. Most often their work is voluntary so highlighting their achievements in performance reviews will undoubtedly improve their performance and engagement.
• Succession planning: You can find high potential talent and future leaders within ERGs.
• Workforce planning: Organizations can leverage the knowledge of ERGs for strategic projects. Likewise, members of ERGs can provide great testimonials for acquisition initiatives that attract top talent from diverse backgrounds.

Challenges of running effective employee resource groups

While there are a number of benefits to having ERGs in the workplace, there can be some drawbacks. These include:

• Not all members share the same vision of success, which may lead to divisiveness. 
• ERGs can give a false sense of security that diversity issues have been solved.
• Organizations with low employee engagement may struggle to develop successful ERG programs. 
• Some ERGs struggle with a lack of budget because of a lack of support from leaders.
• There are few research studies into how best to run an ERG.
• Too many ERGs can leave employees wondering where they belong. 
• Many employee resource groups are run by volunteers who have aren’t compensated for their efforts. 
• Members of ERGs can feel siloed off from the rest of the organization. This can counteract the goal of inclusion.

To mitigate these challenges, ERGs need support and buy-in from leaders. Without it, gaining a budget for activities or events becomes more difficult. Likewise, without engaging events, engagement in the ERG can plummet leading to stagnation. For this reason, having executive sponsors “ensure[s] ERGs undertake a broader, more impactful vision for contributions and ensure[s] the ERG has the organizational capital to make that vision a reality. They are some of the most critical and yet under-utilized diversity allies we have in today’s large organizations.” 

Starting your employee resource group

When ERGs are aligned to company goals, it is a win-win for everyone. Groups can help foster a welcoming community for those from different backgrounds and demographics. Companies may also seek the advice of ERGs when it comes to working with diverse suppliers or customers. ERGs are also valuable partners when it comes to recruitment and employee development. 

To get the most out of an ERG, develop guidelines and structure to facilitate meetings, manage resources such as budgets, and set boundaries for members. It should include developing some roles within each group, such as leader and treasurer.

We’ve outlined the best practices for building an employee resource group so you don’t miss any crucial steps. If you’re ready to take your ERG to the next level, consider starting an internal mentoring program that connects leaders with ERG members. You can use mentor matching software like Together’s to make the pairing process seamless. The platform will also send each pairing meeting agendas so their conversations are focused on topics that promote their growth. 

Overall, ERGs are about employee connection. Creating a support community for employees to meet others like them will undoubtedly positively impact a workforce's engagement and feelings of belonging.