What Are Employee Resource Groups (ERGS)? ERG Definition, Purpose, and Types
Diversity Equity and Inclusion Director for MentorcliQ
May 17, 2023
Employee Resource Groups, or ERGs, are now a standard form of employee engagement, culture building, and retention. They’re nearly ubiquitous at Fortune 500 companies, with 90% (or more) of the top U.S. organizations offering them to employees. Interestingly enough, however, they’re still somewhat of a mystery to many people, including company leaders. What is an Employee Resource Group? Who can be in one? Are they even necessary?
In this post, we’ll answer the most important and common questions about ERGs. We will also help guide you in the right direction, whether you’re considering creating an ERG or joining one.
Employee Resource Group Definition
Consider this the “ERG 101” section. We’ll start with the basic question everyone always asks, “what is an ERG?”
Employee Resource Groups (ERGs) are groups of employees who unite around a common identity or interest, such as:
- Racial or ethnic identities
- Career path
- Life status (such as working parents)
The idea for ERGs is fairly simple: To create a supportive space within a larger organization that fosters diversity, equity, and inclusion through a shared space. Ideally, this helps improve overall morale and productivity for participants by allowing them to create strong connections and community within their place of work.
Business Resource Group Definition
We should note that “ERG” or “Employee Resource Group” is by far the most common term used to refer to this type of group. There are others, however. The other term you’ll find widespread is “Business Resource Group” or “BRG.”
A Business Resource Group is any group of employees who unite around a common identity or interest, such as:
- Racial or ethnic identities
- Career path
- Life status (such as working parents)
I know what you’re thinking here: “Wait…you just said that about ERGs.”
You’re correct. We did! Hop to the next section to understand why.
ERGs vs. BRGs: Is There a Difference
Are Employee Resource Groups and Business Resource Groups the same thing? From our perspective, yes. But that’s not an opinion that’s shared by everyone. You’ll find that some websites provide different definitions for ERGs and BRGs.
For example, The Diversity Movement states the following:
“ERGs additionally focus on professional development, mentorship opportunities, and awareness efforts. Business Resource Groups are focused on driving strategic business imperatives forward, in addition to addressing the purposes outlined for ERGs.”
The difference, according to them, is subtle. But for some people, that difference is there, and it’s enough to use different terms. The idea that BRGs do everything ERGs do but also focus additionally on strategic business imperatives is shared by others. In most cases, however, you’ll likely find that the two terms are used interchangeably without any distinction.
From a Google Trends perspective, the two terms are used about the same amount, at least when people are performing Google searches.
Now, if you want a little insider perspective: Don’t attach too deep a meaning to what a company chooses to call these programs. For example, Mastercard uses Business Resource Groups, while Ally Financial uses Employee Resource Groups. And Kellogg’s, to make things even more confusing, uses a combination of both. It calls its programs Business Employee Resource Groups (BERGs).
Other terms we’ve seen include:
- Business Partnering Groups
- Employee Networks
- Network Resource Groups
- Associate Resource Groups
- Business Councils
- Affinity Groups
There’s more, but you get the idea. “Groups” is often a part of the word, or “Networks” or “Business” or many combinations of these. They’re all effectively serving the same purpose, so try not to get too lost in the terminology.
Which term should I use for my affinity group?
For what it’s worth, ERGs and BRGs are the same idea under a different heading. Nothing precludes ERGs from focusing on driving strategic business objectives. Most do since their very existence is critical to several business objectives (DEI, employee engagement, retention, and culture building).
If you’re building ERGs for the first time, use whichever term you want. Or make up a new one.
We’ve already shown you a few examples you can use as a template. Just make sure you properly market your affinity group concept in a way that builds buy-in from everyone across your organization. And make sure how you position and market that ERG is visible in a way that potential employees and job applicants can see it too.
Something to keep in mind for the future, though, is how ERGs are perceived. Some argue that the term ERG implies the groups are only for marginalized employees. In contrast, others believe BRG suggests a more professional and corporate approach suitable for business contexts. There’s a chance that how you name your groups could impact their perception. ERGs have the potential to support positive change in the workplace. Don’t let the naming convention you choose make your life and work more complicated than it needs to be.
What Is the Purpose of an Employee Resource Group?
Now here’s the million-dollar question. There are some misconceptions about ERGs, particularly why they’re even necessary to begin with. ERGs are multi-purpose engagement strategies that serve multiple purposes. An effectively created, properly structured, and well-run ERG can serve multiple purposes, including:
- Helping new employees onboard more quickly
- Connecting employees to meaningful workplace relationships
- Help employees network more authentically
- Build and spread company culture
- Create a safe space for employees to interact with colleagues
- Increase employee engagement
- Improve employee retention
- Serve as a location for finding high-potential employees
- Provide a central location for networking
The purposes don’t end there. And each of those purposes can be directly connected to a key business objective. What’s more, each can also be tied to key performance indicators if the program is planned, structured, and executed correctly. Diverst’s ERG software is a leader in helping make sure your affinity programs are measurable, but you’ll still need to think and plan strategically before you launch them.
7 Key Benefits of Employee Resource Groups
Whether you’re an executive leader trying to determine if an ERG is necessary or an employee wondering whether you should join a program, the benefits of Employee Resource Groups are pretty clear. Here’s a more detailed breakdown of why ERGs are a good idea to have or join.
1. ERGs help build community and internal support networks
Do you ever feel like you don’t belong at work? Are you lacking someone to relate to or confide in about the unique challenges at your job? Employee resource groups can help. These groups, formed around shared interests or identities, provide employees with a supportive community.
Providing employees a space to connect and share experiences creates a more welcoming and supportive culture. Joining or starting an ERG is a great way to gain extra support or make your workplace more inclusive. With the majority of Gen Z and Millennial workers saying they want to work in a diverse company, ERGs are an effective way to start building that type of culture.
2. ERGs can help foster diversity, equity, and inclusion
In a guide that explores diversity, equity, inclusion, and belonging (DEIB) in more depth, Sam Cook from the mentoring software company MentorcliQ writes:
“In addition to valuing and respecting differences, DEIB is crucial to creating a sense of belonging among employees of all backgrounds, identities, and experiences.”
Employee Resource Groups are gaining popularity in the workplace as companies respond to increasing demand for attention to DEIB. Because ERGs emphasize affinity group participation, they’re one of the best options to support a DEI strategy.
When designed well, ERGs should help employees from all types of backgrounds connect with others who are similar to them. These programs usually offer networking, mentorship, and career advancement opportunities that may not exist for participants through other means. It comes down to visibility. That’s a critical DEI objective and a must-have for a company that wants to claim it supports DEI.
But there’s a hitch in that plan. These groups only do that when they’re adequately supported by leadership. And while 100% of leaders say they actively support and promote ERG participation, just 52% of employees say the same. And one study found that just 8% of employees at Fortune 500 companies even participate in their company’s ERGs.
It’s a bit of a “he said/she said” between executive leaders and employees, but perception is everything. If half of surveyed employees say ERG participation is not encouraged, what employers say doesn’t matter. It means leaders at organizations where ERGs exist are failing at communicating their desire to see people participate. That needs to change for ERGs to have the desired DEI impact that they’ve already been proven to offer.
3. ERGs can help amplify the voice of employees from historically underrepresented groups
Although not exclusively, many ERGs or BRGs tend to focus on giving employees from historically underrepresented groups a dedicated place to connect, grow, and learn. If you’re unfamiliar with the term “historically underrepresented groups,” Emory University has a great definition for it:
“…groups who have been denied access and/or suffered past institutional discrimination in the United States…”
This doesn’t have only to be applied to the U.S., of course. Many countries have historically underrepresented groups of their own. But from a U.S. perspective, the types of ERGs you may commonly find covers people who identify with the following:
- Black/African American
- Adult learners (e.g., career professionals without a college degree)
- Lower-income individuals
- People with disabilities
- Some religious groups
ERGs are a powerful tool for amplifying employee voices within these groups. By creating a platform for dialogue, engagement, and feedback, ERGs can help surface issues and concerns that might otherwise go unnoticed.
This can inform company policies, practices, and culture, leading to increased engagement and commitment from employees. However, ERGs can face obstacles and limitations, such as attracting and retaining members, if they lack adequate support or recognition from the company. ERGs have also been known to face resistance from individuals or groups who feel excluded or marginalized by the focus on a particular identity or issue.
4. ERGs serve as professional development hubs
Affinity groups like ERGs are a great place to leverage employee development strategies. These communities can empower individuals in their workplaces and help them achieve professional goals through networking, mentoring, and leadership development.
That said, not all ERGs function this way. Some ERGs have a larger emphasis on social connection and culture building, making them more useful for those purposes. Nevertheless, you can add a skill development and growth element to pretty much any ERG, especially if you have integrated software like Diverst’s tool that allows you to add those features to any ERG program hosted in the software platform.
Don’t just sit there staring at your screen: Book a demo and learn more about what ERG software can do!
5. ERGs can create or boost career opportunities
The networking available through ERGs is unique and hard to replicate with other engagement strategies. As participants engage with like-minded professionals, it can lead to valuable connections, mentorship opportunities, and access to insider information about career advancements within the organization.
We’ve also found that active participation in ERGs can raise an individual’s organizational visibility. By taking on leadership roles or contributing to ERG initiatives, members can demonstrate their skills, expertise, and commitment DEI. Such visibility can lead to increased recognition from senior leaders, opening doors for promotions or special assignments.
6. ERGs can strengthen company culture
Some employees will feel out of place, especially in a remote or hybrid work environment. Employees can feel isolated and lonely. Employee Resource Groups can help. They give employees a space to connect with colleagues who share their interests and background. Doing so helps them find workplace buddies and form long-lasting relationships that boost morale. Not all research agrees on whether participation in these groups improves company culture or reinforces stereotypes.
However, the importance of creating a culture where all employees feel seen and valued is clear. Let’s keep the conversation going and empower each other in the workplace.
7. ERGs can improve employee retention
Have you worked for a company that didn’t align with your values and beliefs? Maybe you were the only person of color or with a disability in the office. It’s a common experience with little discussion. For many employees, these negative experiences are enough reason to quit.
As Axios reported in a 2020 article, “Corporate America’s revolving door for Black employees,”: “Systemic racism is leading to a turnover problem in corporate America: Companies have a hard time holding on to Black employees.”
At some companies, the turnover rate for Black and other BIPOC employees can be as much 2x higher (or more) than for White employees. Much of that comes down to feeling isolated and alone, even in an in-person office. Many BIPOOC employees say remote work has improved their work experience (making them less likely to quit), but it’s often not enough.
ERGs help companies tap into diverse perspectives, leading to better decision-making and innovation. Some companies may fear ERGs are divisive or exclusive, but they are a powerful tool for an equitable workplace.
How Do I Start an ERG?
Launching an Employee Resource Group won’t happen overnight, but it can happen much more quickly than you’d imagine. The key is planning ahead of time and using the right tools.
We recommend you book a demo to get a more detailed understanding of how ERGs are launched, but here’s a quick rundown of how to start an ERG:
- Define your purpose and objectives: Clarify the purpose of your ERG. Identify the group’s specific goals, focus areas, and target audience. Determine the issues, challenges, or opportunities you aim to address through the ERG. This clarity will guide your efforts and help you gain support from potential members and stakeholders.
- Build a core team: Recruit a group of dedicated individuals who share a passion for the ERG’s purpose. This core team will drive the initial efforts, organize activities, and ensure the ERG’s sustainability. Seek members from various departments, levels, and backgrounds to bring diverse perspectives and expertise to the group. Consider reaching out to potential allies, advocates, and individuals with influence in the organization to join your team. You may also use this step to build the ERG leadership structure for each planned group.
- Gather support and alignment with organizational goals: Obtain support from key organizational stakeholders, such as senior leaders, human resources, or diversity and inclusion champions. Share your vision, objectives, and potential benefits of the ERG. Highlight how it aligns with the organization’s values, goals, and commitment to diversity and inclusion. Engage in conversations and gather feedback to address any concerns or questions. Show how the ERG will be measured.
- Develop an action plan: Create a detailed action plan that outlines the ERG’s activities, timeline, and resource requirements. Determine the frequency of meetings, events, or initiatives, and establish a communication strategy to engage members effectively. Identify potential partnerships or collaborations with other ERGs, departments, or external organizations to amplify your impact. Don’t forget to include an internal marketing plan to build membership and participation.
- Launch and promote the ERG: Once your action plan is in place, officially launch the ERG. Raise awareness about the group through various communication channels, such as email announcements, intranet postings, or internal social media platforms. Organize a kickoff event or information session to introduce the ERG, its purpose, and its benefits to potential members. Encourage interested employees to join and actively participate in the ERG’s activities.
Creating these spaces will improve the experience for everyone, not just BIPOC employees or those from marginalized groups. While those populations tend to get the most attention, ERGs are for everyone. As long as your approach is creative and inclusive, all employees can benefit from your approach to Employee Resource Groups.