March 29, 2023

Employee Resource Groups: Impact of Employee-Led Diversity Initiatives

Syed Ahmad Arshad
Product Designer | Fullstack Developer
Employee Resource Groups

Now with companies growing bigger and employing a more diverse workforce than ever, the need to indulge employees in constructive circles encouraging interaction, development, and support has grown massively. Not all employees in a company come from similar backgrounds or share the same values. In a diverse workforce, chances are that people belong to different underrepresented groups as well, and if the said people feel unheard, marginalized, or badly treated on any platform, they will quit looking for other opportunities.

Talented employees may come from any race, background, or group and it is only wise to allow them to foster a tolerant and inclusive culture where they can excel in their fields. Underrepresented groups of employees i.e. women in some regions, religious/ethnic/linguistic minorities, and differently-abled people, may feel more connected if they are encouraged to form communities and support groups. Moreover, people with similar interests, likenesses, and goals may also come together and do something about their passion. With the goal of inclusive company culture in mind, company leadership in major firms encourages their employees to create Employee Resource Groups (ERGs).

What are Employee Resource Groups (ERGs)?

Employee resource groups(also called affinity groups) are employee-led, voluntary groups formed within an organization to support and promote diversity, equity, and inclusion initiatives. ERGs typically focus on specific demographics, such as gender, race, ethnicity, religion, sexual orientation, disability, or veteran status.

The purpose of ERGs is to create a sense of community and belonging for employees who share common interests, backgrounds, or experiences. They provide opportunities for professional development, mentorship, financial support, networking, and socializing. ERGs also serve as a platform for employees to advocate for policies and practices that support diversity, equity, and inclusion in the workplace.

ERGs are often supported by the company leadership and receive funding, resources, and guidance to carry out their initiatives. They play a crucial role in building a more inclusive and supportive workplace culture, enhancing engagement and employee retention, and attracting and retaining diverse talent.

ERGs: A Brief History

ERGs History

The history of employee resource groups (ERGs) dates back to the 1960s when a few companies began forming groups to support employees from different minority backgrounds. The concept of ERGs emerged as a response to the Civil Rights Movement and the need for companies to address diversity and inclusion issues in the workplace.

In the 1970s, ERGs became more prevalent as a way for companies to recruit and retain diverse talent. Many large companies, including IBM, Xerox, and AT&T, started formalizing their ERG programs, offering support, resources, and funding to employee-led groups.

In the 1980s and 1990s, ERGs began to expand their focus beyond ethnicity and race, including groups for women, people with disabilities, and veterans. ERGs became a way for employees to connect with like-minded individuals, support each other, and advocate for change within their organizations.

In the 2000s, ERGs continued to grow in popularity and importance. Many companies recognized the business benefits of having diverse and inclusive workplaces, including increased productivity, creativity, and innovation. ERGs became a strategic tool for companies to improve their diversity and inclusion initiatives, support employee development, and strengthen their employer brand.

Today, ERGs are a common practice in many companies and industries worldwide. They play a critical role in creating a more diverse and inclusive workplace culture. As per TopMBA, around 90% of Fortune 500 companies have ERGs.

Primary Objectives of an Employee Resource Group

Primary Objective

The primary goal of an Employee Resource Group (ERG) is to create a supportive community within an organization that advocates for the needs and interests of a specific group of employees. ERGs should aim to:

The specific goals and objectives of an ERG may vary depending on the organization and the group it represents. However, the overarching aim of an ERG should be to create a more inclusive, supportive, and equitable workplace for all employees.

Benefits of ERGs: How They Help Build a Social Fabric

ERGs can provide a number of benefits for both employees and the organization as a whole. Some potential benefits of ERGs are discussed below.

Community building

Community Building

Employee groups can create a feeling of belonging among employees who share similar experiences or backgrounds. By providing a platform for employees to connect with others who understand their unique challenges and perspectives, ERGs can help foster a sense of community within the organization. This feeling of connection and community can help increase employee loyalty and reduce turnover.

Support and mentorship


ERGs can offer assistance and guidance to members who face specific obstacles or issues in the workplace. Through peer support and mentorship programs, ERGs can help members navigate these challenges and develop professionally. This type of support can be especially valuable for employees who may feel isolated or lack access to traditional mentorship opportunities. By providing this support, ERGs can help members build skills and confidence and ultimately contribute more effectively to the organization.

Diversity and inclusion

Diversity and Inclusive Company Culture

Employee Resource Groups (ERGs) are a valuable tool that organizations can use to promote diversity and an inclusive environment. ERGs provide a forum for underrepresented employees to share their experiences and perspectives, which can help organizations gain a deeper understanding of the needs and concerns of their diverse workforce.

By creating a space for employees from diverse backgrounds to come together, ERGs can help organizations to build a more inclusive company culture and discourage workplace discrimination. ERGs can also serve as a resource for employees who may feel isolated or marginalized in the workplace, providing them with a support network and a sense of community.

Through ERGs, employees can share their ideas and perspectives with management, which can help to inform diversity and inclusion initiatives. ERGs can also serve as a resource for organizations as they seek to attract and retain a diverse workforce.

Employee engagement

Employee Engagament

Employee Resource Groups (ERGs) can have a positive impact on employee engagement by offering opportunities for employees to actively participate in the organization and contribute to its objectives and values.

ERGs create a sense of community and belonging, which can increase employee engagement and motivation. When employees feel that they are part of a group that values their unique perspectives and experiences, they are more likely to feel connected to the organization and its mission.

ERGs also provide employees with opportunities to develop new skills, gain visibility within the organization, and work on leadership development. This can help to boost employee morale and job satisfaction, which in turn can lead to increased engagement and productivity.

Talent development


ERGs, or Employee Resource Groups, can play a significant role in identifying and nurturing talent within an organization. ERGs are groups of employees who share common interests or backgrounds and come together to promote diversity, equity, and inclusion in the workplace.

Through participation in ERGs, employees can develop valuable professional and other leadership skills. ERGs provide opportunities for members to take on senior leadership roles within the group, which can help them build their leadership abilities and gain experience in managing teams and projects.



Employee Resource Groups can be instrumental in attracting and retaining diverse talent in organizations.

By demonstrating their commitment to diversity, equity, and inclusion through the formation and support of ERGs, organizations can showcase their values and attract candidates who prioritize these values in their job search. ERGs can also serve as a resource for recruiting and networking with diverse candidates, as members of ERGs often have connections to diverse communities and can help organizations reach a broader pool of candidates.

Furthermore, ERGs can help organizations retain diverse talent by providing a sense of community and support for employees from underrepresented groups. ERGs can help employees feel valued and included in the workplace, which can improve job satisfaction and reduce turnover rates.

Cultural awareness

Cultural Awareness

ERGs can play a significant role in promoting cross-cultural awareness and understanding among employees by providing education about different cultural backgrounds.

These groups can serve as a valuable tool for educating employees on various cultures, which can help foster a deeper understanding and appreciation for diversity in the workplace. By doing so, they can help create a more welcoming and inclusive environment.


ERGs can contribute to innovation and problem-solving by bringing diverse perspectives and ideas to the table.

Employee well-being

Employee Well-being

Employee groups have the ability to offer employees valuable emotional and social support, which in turn can enhance their overall sense of well-being and improve their mental health. In other words, ERGs can serve as a helpful resource for employees seeking to improve their emotional and social needs, leading to a positive impact on their mental health.

Brand image

Brand Image

ERGs can play a significant role in bolstering an organization's brand image by showcasing a dedication to promoting diversity and inclusion. This, in turn, can attract customers and investors who prioritize these values when choosing where to invest their time and money. In simpler terms, ERGs can help organizations project a positive image of themselves by demonstrating a commitment to diversity and inclusion, which can attract customers and investors who share those values.

Community involvement


Effective employee resource groups offer employees the chance to participate in community outreach and volunteer activities, which can ultimately enhance an organization's connections with its community and have a positive social impact. In other words, ERGs create opportunities for employees to engage with their community in meaningful ways, which can help the organization build stronger relationships with community members and have a more positive influence on the community as a whole.

Frequently Asked Questions (FAQs)

What should an ERG do?

An Employee Resource Group (ERG) is a community within an organization that advocates for a specific group of employees. ERGs should create a sense of belonging, discuss issues related to diversity, promote awareness, collaborate with management, encourage career growth, engage in community outreach, and serve as a resource for the organization. The specific goals of an ERG may vary, but the primary objective should be to create a more inclusive, supportive, and equitable workplace for all employees.

How much do ERG leaders make?

ERG leaders are typically not paid for their role as it is considered a voluntary position within an organization. ERGs are usually led by employees who have a passion for the group they represent and are willing to dedicate their time and energy to create a supportive community within the organization.

In some cases, an organization may provide resources or funding to support the initiatives of an ERG, but this is not typically used for compensating the leaders of the group. Instead, ERG leaders often receive personal and professional development opportunities and recognition for their contributions to the organization.

What is a typical ERG budget?

The budget for an Employee Resource Group (ERG) varies widely depending on the size of the organization, the goals of the ERG, and the level of support from the company. Some ERGs may have a very small budget or no budget at all, relying on the passion and dedication of its members to carry out their activities. Other ERGs may have a larger budget that supports initiatives such as training, community outreach events, or professional development opportunities for its members. Generally, ERG budgets are determined on a case-by-case basis and are subject to the organization's available resources and priorities.

What is a wellness ERG?

A Wellness ERG, or Employee Resource Group, is a group within an organization that is focused on promoting the overall well-being and health of its employees. This type of ERG aims to create a supportive community that fosters a healthy work-life balance and encourages employees to prioritize their physical and mental health.

How do you structure an Employee Resource Group?

Structuring an Employee Resource Group (ERG) involves creating a framework that provides a clear purpose, objectives, and guidelines for the group. Here are some steps to help structure an ERG:

By following these steps, an organization can structure an ERG that is effective, sustainable, and aligned with the needs and interests of its employees.

What is an ERG program?

An ERG program, or Employee Resource Group program, is a formal initiative within an organization that supports the creation and management of ERGs. This program is designed to provide resources, support, and guidance to ERG leaders and members, and ensure that the ERGs align with the organization's mission and goals.

What are the most common employee resource groups?

The most common Employee Resource Groups (ERGs) vary depending on the organization and its workforce. However, some of the most common ERGs found in many organizations include:

What makes a good ERG leader?

A good ERG (Employee Resource Group) leader possesses several key qualities, including:

What is the difference between ERG and affinity group?

ERG (Employee Resource Group) and affinity group are often used interchangeably, but there is a slight difference between the two.

An ERG is a formal initiative within an organization that supports a specific group of employees, often those who are underrepresented in the workplace. ERGs provide resources, support, and guidance to members and help promote a more inclusive workplace culture. ERGs are often sponsored and supported by the organization and may receive funding and other resources to support their activities.

On the other hand, an affinity group is a more informal group of individuals who share a common interest or identity. Affinity groups may form within or outside of an organization and may not have a formal structure or sponsorship from the organization. While affinity groups can also provide support and resources to their members, they may not have access to the same level of organizational support as ERGs.

How's BRG different from ERG?

BRG stands for Business Resource Group, which is similar to an ERG but with a more business-oriented focus. BRGs are formed to support specific business goals and objectives, such as increasing sales or improving customer satisfaction, by leveraging the unique perspectives and insights of employees with a shared characteristic or interest.

While ERGs typically focus on promoting diversity, inclusion, and employee well-being, BRGs may have a more specific business goal or function, such as marketing to a particular customer segment or developing new product ideas based on the insights of employees from diverse backgrounds.

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