How to Create Employee Resource Groups in Your Business

  • Employee resource groups are worker-led communities that create a sense of belonging in a business.
  • These groups are an important way for small business owners to attract and retain talent.
  • Nine HR and DEI leaders tell Insider how business owners can start a successful program.
  • This article is part of Talent Insider, a series with expert advice to help small business owners navigate a range of recruiting challenges.

It’s hard to maintain a sense of community as a small business grows, but it’s not impossible. To create a sense of belonging, entrepreneurs should create employee resource groups, nine HR and diversity, equity and inclusion leaders told Insider.

These groups are employer-based networks formed around shared identities, affinities or interests, says Kristy Lilas, vice president of diversity, inclusion and belonging at web hosting company GoDaddy.

“They provide a community for employees to develop relationships and support each other’s professional development, work together on projects and programs, and learn from each other,” Lilas added. “They also make us have fun.”

These groups typically encompass a wide variety of identities—from identities designed by and for black workers, to identities dedicated to workforce veterans. They should only be created if a business has a community that needs it, says Amy Spurling, CEO and founder of human resources platform Compt.

Nine HR and diversity, equity and inclusion leaders share their advice for small business owners interested in starting and supporting employee resource groups at their companies.

Generate interest and infrastructure at the same time

These groups may be led by employees, but entrepreneurs should be involved in their creation, said Sharon Ray, head of diversity, equity and inclusion at Envoy Global, which provides immigration services software.

If employees are interested in setting up employee resource groups, companies should already have a clear structure, said Paloma Thombley, vice president of Handshake, a platform that helps college students find careers.

“Think of it like a training wheel,” Thombley added. “You need to be able to support them before you let them ride themselves and figure out what’s best for the team.”

Naznine Tilak, global head of diversity, equity, inclusion and belonging at software company Pegasystems, says this can be accomplished with a handbook that guides community leaders through responsibilities, event planning, budgeting and more.

Missions should be aligned with business goals

Compt’s Spurling says employee resource groups shouldn’t be just a conduit for employee complaints. Small business owners must ensure that their team’s mission aligns with their company’s goals.

“Having an ERG group needs to have a positive outcome,” she said, referring to the employee resource group.

At accounting and consulting firm KPMG, for example, employees in participating groups are able to collaborate and build lasting relationships with similar communities in client organizations, says Elena Richards, KPMG’s chief diversity, equity and inclusion officer. Richards added that at KPMG, one in three employees joins the company’s employee resource group.

“We can forget that a company’s greatest asset is its employees,” says GoDaddy’s Lilas. “No matter what we do as a business, there are people behind the work and without them our business cannot function.”

Engagement in leadership through executive sponsorship

Emily Goldberg, HR business partner at startup data and research firm Crunchbase, said the executive sponsor — a representative from the leadership team that supports and advocates for employee resource teams — is critical to the success of the project.

“They bridge any gaps where employees may have to really drive their goals and events,” Goldberg said.

In a perfect world, employee resource groups would have two executive sponsors, said Bernard Coleman, chief diversity and engagement officer at Envoy’s Ray and small business HR platform Gusto. Coleman added that one of the co-sponsors should determine what the group is designed to do, while the other should not.

KPMG’s Women’s Network, which will celebrate its 20th anniversary next year, has always had men on its advisory board as a way to teach male leaders how to be effective allies, Richards said.

But Terri Hatcher, chief diversity and inclusion officer at information technology firm NTT Data, said leadership’s involvement in employee resource groups should not be limited to executive sponsorship. For example, in the wake of the murder of George Floyd, the CEO of NTT Data asked to meet with the leaders of the company’s team supporting Black and African American employees to discuss how to create the best possible solution for all employees workplace, Hatcher said.

“Our leadership sees ERG as a subject matter expert,” Hatcher added. “So if there’s something going on within our society or organization and they think one of our ERGs might be able to provide insight, they’ll get in touch with them.”

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