March 1, 2024

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What Are Employee Resource Groups? | Company Culture

3 min read
What Are Employee Resource Groups? | Company Culture

Employee Resource Groups (ERGs) are voluntary, employee-led groups with a shared purpose. They provide support and access to resources as well as promote career development, satisfaction and success in the workplace for employees united by a characteristic, an interest or an intention.

Team of millennial colleagues sharing ideas for new business start up, togetherness, innovation, diversity

(Getty Images)

The first official ERG in the United States, the Xerox National Black Employees Caucus, was created in 1970 as a forum for Black employees to advocate for inclusion and change within the company. Over time, ERGs have been formed to support employees united by gender, ethnicity, sexual orientation, religious affiliation, lifestyle or interest.

In the modern workplace, ERGs are comprised of employees with a shared characteristic as well as allies, or supporters of those employees. Many ERGs work in partnership with or emerged from a company’s goal to create a more diverse and inclusive culture.

Allyship, or the inclusion of others who support the cause and focus for which the ERG was formed, is increasingly common. For example, an ERG for working parents may also have colleagues that do not have children as part of their membership or leadership.

Including others who have not have lived the experience shared by the ERG members can increase sharing of ideas, consideration of opposing viewpoints and enhancing mutual respect. This inclusivity helps with better understanding of the challenges, addressing bias and can increase awareness and belonging for all ERG members.

How Common Are ERGs?

In a 2017 Forbes article, Georgene Huang reported that over 90% of Fortune 500 companies had ERGs. But since the start of 2020, “about 35% of companies have added or expanded their support for ERGs, according to a 2021 McKinsey & Co report. The Society for Human Resource Managers also estimates that about 8.5% of employees participate in ERGs at their company.

Although ERGs have a long history, they are being discussed more than ever. For one reason, employees and leaders at mid-sized and smaller companies, especially those that participated in effective ERGS at larger companies, have helped to promote ERGs in their organizations.

Additionally, many companies see ERGs as a key component of fostering more inclusive environments and achieving diversity, equity and inclusion (DEI) goals. Research conducted by public relations firm Weber Shandwick found 76% of corporate diversity professionals viewed ERGs as part of “well-aligned D&I initiatives.”

How to Create an ERG?

An ERG can be launched by an employee or a group of employees, or it can be implemented by leadership in response to a growing interest or need by employees.

Regardless of how they start, effective ERGs often include engaged employees and attentive leaders who can effect change and advocate for the needs of the group at a senior level. A prevailing concept for impact is to have an executive sponsor for the ERG.

“It links the ERG to the organization’s business priorities and leadership to the ERG’s contributions and concerns,” according to Great Place to Work.

Taking an “open to all” approach is also important. It is helpful to include some ally members and even a leader who does not share the characteristics of the group but is interested in understanding their perspective. The diversity of thought and viewpoint can increase the ability to propose long lasting solutions and drive positive impact.

Characteristics of an Effective ERG

As with any group or new initiative, great ideas alone do not translate into change, member satisfaction or great experiences. As ERGs are studied and members are surveyed, a some recurring factors for success have emerged. One notable finding is McKinsey & Company’s five dimensions of an ERG that corollate to employee’s feeling of inclusion and belonging. These dimensions include external engagement, allyship, leadership connection, employee community building and career advancement.

If you are an employee looking to start an ERG or join one, or if you are a leader or ERG sponsor, here are some additional factors to consider. Achieving engagement and impact requires clear communication and setting expectations regarding the groups’ mission, purpose, goals and function.

It is important that members have a safe and productive means of sharing their thoughts and ideas. It is also critical that executive leaders listen, ask questions and deepen their understanding of the group’s needs. Finally, prioritizing actions and requests and ensuring that the group has a voice can go a long way to making a positive impact on the company and achieve desired changes or results.

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