Darren Cassidy, president (western Europe) for the US-based technology firm Xerox, is heartfelt when he says that his proudest moment, in 34 years with the business, was when he and his company’s Women’s Alliance employee resource group (ERG) formally launched its first menopause policy, two years ago.
“The safe space our nearly dozen global ERGs allow for is our way of creating an inclusive organisation,” he says. “But [our ERGs] challenge us to ensure real change happens. Once I was a sponsor for the menopause policies, things moved very quickly indeed.”
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Typically, ERGs are established to support people who share common backgrounds, interests, or experiences. Xerox is no stranger to the concept; it launched the world’s first black employee ERG, in the midst of New York’s civil rights riots, in 1964. One could say that everyone else has ‘copied’ Xerox’s template. But having oscillated in and out of popularity (as well as corporate backing) over the years, there’s new evidence to suggest that ERGs could be having another moment.
ERGs are increasingly being seen as a favoured conduit for enabling meaningful diversity, equity and inclusion (DEI). Data published by the software company Benevity in November reveals that 61% of employers plan to boost their ERG budgets this year. Four out of five leaders polled note that ERGs are rising in significance, and 86% say they see ERGs as “critical to culture”.
Because company-wide DEI policies often suffer from what HireVue’s organisational psychologist Tom Cornell observes as a “lack of senior-level engagement,” more and more commentators see ERGs as able to fill this void. “What’s different with ERGs,” argues Lyndsey Oliver, head of EDI at hospitality provider BaxterStorey, “is that they take an inclusion-first, rather than a diverse-first, approach, which means they don’t focus on corporate-sounding quotas or targets, which can be off putting to some. Inclusivity allows diversity to follow naturally.”
Since 2023, the number of ERGs at BaxterStorey has doubled from three to six. Some of its newest ones are its women’s network, Rise, and Tribe, a group supporting working families, which launched in October. Other firms that have recently launched ERGs include the sustainability firm Stantec, which in December 2023 launched a ‘Persons With a Disability’ ERG to join its ‘Neurodiversity UK’ ERG, and four others. Amazon has also added a UK Social Mobility ERG to its existing suite.
So meaningful have they become, and so quickly, that Oliver says, as long as there’s demand, more will likely follow. She adds: “I think these groups make our DEI policies feel more real. That makes them become part of our culture.”
Lead with passion
According to Al Bird, CEO at consulting company Instep, ERGs “get on and do stuff”, led by passionate people, whereas big company PR-led initiatives often fail to draw the same engagement. “Initiatives like the Corporate Equality Index might well increase awareness of the different facets of EDI in the workplace, but ERGs enable employees to steer EDI initiatives in a direction that’s more likely to suit an organisation,” he says.
Rebecca Clarke, Stantec UK’s head of inclusion, diversity and wellbeing, adds: “We’ve decided to use ERGs to really challenge us. Our ERG heads sit in quarterly meetings with our inclusion, diversity and equality council.”
Similarly, Oliver praises Rise for its input in developing the company’s new surrogacy pay, adoption leave and associated benefits. “ERGs really share their lived experiences,” she says. As software firm Workhuman’s Evolution of Work research (2023) revealed, nearly two-thirds of staff say ERGs contribute to psychological safety. The presence of an ERG makes them trust leaders more (36%); trust co-workers more (31%), and helps them feel more connected to the company culture (26%).
A critical view
Of course, it’s not always quite that simple. ERGs have been criticised – such as by Stonewall co-founder Simon Fanshawe – as simply comprising identity groups that focus too much on one agenda, becoming divisive ‘grumble hubs’ for employee activists.
Hanna Naima McCloskey, founder of DEI agency Fearless Future, who has penned her own white paper calling for better blueprint for doing DEI, also shares these concerns. “There’s a real danger,” she argues, “that as ERGs become more popular, firms could see them as ‘the DEI strategy’, which is a failure of recognising what the purpose of DEI should be”.
She adds: “Good DEI should advocate an issues-led, rather than identity-led, approach, such as looking at why disabled staff may not be getting promoted as much as non-disabled staff. An issue-led approach will look at how all people are affected.” It’s not an isolated view.
Thushy Muruges, equitable design lead, people experience, for HR software firm Culture Amp, says: “ERG leaders are often unfairly tasked with driving structural change. Most ERG leaders lack the skills, authority or resources to execute these responsibilities effectively, making this expectation unrealistic.”
Among McCloskey’s gripes are that ERGs typically compete against each other, and that “while members have marginalised experiences, that’s no guarantee they’ll be able to design policy.” She reports knowing marginalised people who are asked to do work because of their protected characteristics, which can lead to burnout. ERGs can also be closed shops, she adds, when allies are what’s really needed.
It’s not that McCloskey doesn’t think ERGs can be influential: “They just need to be properly structured,” she says. “It’s vital that ERGs have a strong, strategic container around what their purpose is. That means closely tying them to the long-term DEI strategy of the company.”
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Diane Lightfoot, the Business Disability Forum’s CEO, says: “Many of our members have a disability ERG, but many will still debate how they should be used.” She adds: “They have to be part of a larger eco-system.
“Firms still need to channel the lived experiences they are collecting. While ERGs can identify issues, HR still needs to provide the support, such as adjustment programmes.”
Entertainment business AEG Europe’s senior VP of HR, Kirstie Loveridge, concurs. Loveridge launched the business’ first ERGs during the height of the Covid-19 pandemic. She describes them as “a real game changer in showing we cared," while admitting that she let them “do things their own way,” to start with. She says that she’s now developed “more of a framework for how they operate”, where people join the group for set periods of time, and have budgets and leaders allocated to them.
“ERGs aren’t replacing the DEI strategy; they’re a part of it,” she says. “We still have specialist EDI practitioners.”
At BaxterStorey, new ERGs are first cultivated in its over-arching inclusion network, Dive In, to see if there’s traction before officially being spun out. This approach was taken for six months before Tribe was officially launched.
Oliver explains: “We know that companies still need a strong DEI strategy to slot into. We create a business case for an ERG first, and each ERG has a core committee. They work with our marketing and brand team to communicate messages to the wider company.
She adds: “To stay focused, and because they come up with so many good ideas, each ERG is tasked to identify what we call a heavy-weight, mid-weight, and light-weight campaign each year. This way we know we’ll have at least 18 campaigns from our six groups. We also ensure that these don’t overlap.”
Keeping ERGs focused
The key, it seems, is for HRDs to make sure that ERGs stay focused. McKinsey research finds staff who rate ERGs as ‘effective’ or ‘very effective’ are much more likely to report positive inclusion scores than staff who rate their ERGs as ‘ineffective’ or ‘very ineffective’ (83% vs 59%). At professional services firm Davies Group – which launched its women’s network ERG at the end of last year – staying effective is enshrined in one of the pillars that any ERG must adhere to: change.
ERGs are mandated to influence change, says Gillie Fairbrother, its global responsible business officer. “We restructured our ERGs with proper governance specifically to help them impact policy.”
She adds: “We see DEI as everyone’s job. But it’s also about the actions that the business can take from ERGs challenging us. It’s driven by employees, but actioned by HR.”
Where ERGs excel
“Firms need to remember that, primarily, ERGs are safe spaces for the communities they serve,” says Kate Thrumble, head of people and experience for creative agency VaynerMedia. “The magic of our recently created mental health ERG is that it doesn’t replace DEI; it is part of it.”
She adds: “We insist that ERGs have global sponsors, which prevents them from being echo chambers. They work with HR because they’re often good at recognising blind spots. For example, our LGBTQ+ group recently sense checked our transition policy.
“The DEI strategy has to be tight in order for ERGs to work. Just because a company launches an ERG, it doesn’t guarantee it’ll automatically be successful; they still need commitment.”
Martin Scragg, chair of Stantec’s UK Neurodiversity ERG, reports spending two to three hours a week on his ERG. “ERGs aren’t an easy option for doing DEI,” adds Stantec’s Clarke. “We work hard to ensure that our top-down DEI model meets in the middle with bottom-up ERGs.”
What is clear is that traction for them is growing. “After I spoke about our Neurodiversity ERG, I was bombarded with requests from people asking for advice about how they could set their own ERG up,” reflects Scragg.
But, as Sam Price, talent solutions director at recruitment and consultancy Morson, says, they just need doing properly: “As DEI budgets have been cut, and impact has been difficult to prove, ERGs are stepping up to be the low-cost, high-impact solution. Connect them to policy and great things happen. When done really well, staff feel listened to, and staff become culture evangelists.”
This article was published in the January/February 2025 edition of HR magazine.
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