Pros & Cons of Employee Resource Groups: Why Companies Need Them

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Originally Published September 2017. Updated December 2019.

Imagine an innovative, efficient, inclusive, and productive workplace, where communication thrives across functions and up and down the hierarchy. This is the picture our clients’ employees paint when they describe their Employee Resource Groups or Business Resource Groups. Who doesn’t want that?

Let’s weigh some of the commonly listed pros and cons of employee resource groups.

Pros and Cons of Employee Resource Groups

Benefits of Employee Resource Groups

  • Grow high-potential leaders
  • Develop community partnerships
  • Assist in attracting diverse talent
  • Boost innovation
  • Encourage professional development
  • Cultivate mentoring
  • Provide cross-functional teamwork

ERGs provide solid opportunities for the next generation. Think of the potential career benefits: greater exposure in expanded networks, access to senior leadership, new skills learned from working on ERG initiatives, and the opportunity to increase cultural awareness throughout the company.

Disadvantages of Employee Resource Groups

Overwhelmingly, there seem to be many more benefits. However, some experts have also argued over the shortcomings that these groups present.

  • Employees of diverse backgrounds have different ideas of success
  • They may give the false impression that diversity issues have been solved
  • Some organizations lack employee engagement

How Charles Schwab has benefited from ERGs

Charles Schawb Employee Resource Group
Schwab veterans network

Charles Schwab’s Employee Resource Groups (ERGs) serve Asian/Pacific Islanders, Blacks, Veterans, LGBT, the environmentally focused, Latinos, parents, and women. Deloria Nelson, Schwab’s Managing Director of Diversity and Inclusion, supports all of those groups. She says, “It’s a great way to connect with colleagues, learn about the company, help recruit great talent, help spread the word about what a good company we are and gain professional development.”

One of the strongest ERG benefits for workers is the chance to develop leadership skills. Nelson explains:

“Participation in an Employee Resource Group provides an opportunity to network with leaders, partner with Talent Acquisition and gain exposure to executives across various locations.”

Lashonda Royal, the national chair of Black Professionals at Charles Schwab (BPACS), describes her experience: “I’ve grown professionally, and my leadership skills have been enhanced. For example, I’ve been a project manager, a liaison, and a guest speaker on behalf of my group, and I am now its national chair. All of these opportunities were new to me and help me exercise my influence with not only my peers but leadership as well.”

How Hyatt has benefited from ERGs

Daniel Chaparro, who is an Area Wellness Manager for Hyatt and is a member of HyPrideAZ chapter, agrees. “Each day I can enter work and be my true self allowing me to focus on my daily tasks and make connections with colleagues, new hires and community partners. As part of the HyPrideAZ chapter we get to bring our purpose to life “We care for others so that they can be their best” by bringing awareness to not only our colleagues on LGBT issues and also be part of the LGBT community within Phoenix.”

Employee Resource Groups empower diverse groups, develop leaders, and develop new business opportunities. As the scope and function of ERGs has grown, the opportunities for career development have grown along with it. Savvy, diverse candidates often seek out companies with ERGs.

Hyatt also has a Women@hyatt ERG that focuses on the development of women leaders. AZWomen@hyatt is a program where colleagues of all levels are able to come together to mentor, flourish and guide the local members in their careers. Women@hyatt also hosts wellness, networking, life balance and community involvement events.  Lori Schacher has been a member of local chapter since 2014 and currently sits on the Board of Directors for the AZ chapter which includes all Hyatt properties in Phoenix and Tucson.

“Women@hyatt is such a great resource for newer colleagues to meet and get to know other professional women within the company at all levels and across all our Hyatt brands. It offers opportunities for growth and development along with networking and fun” says Schacher.

Employees appreciate the enhanced opportunities and are enthusiastic in recommending their workplace to others. “Schwab gets the importance of diversity and inclusion,” explains Nelson. “Supporting ERGs is one way Schwab demonstrates that commitment. We recognize that diversity and inclusion make us a better company. Innovation and excellence are what we strive for, and including people with various backgrounds, gender and gender expressions, ethnicities, ages, disabilities, family status, veteran status and religions contribute to us being the awesome, industry-leading company we are.”

Find a company that supports diversity through Employee Resource Groups

Employee Resource Groups are often a significant indicator of a company having a commitment to diversity and inclusion. BestCompaniesAZ is shining a spotlight on companies like this at our regular career events. Meet hiring representatives from Charles Schwab, Hyatt and many more award-winning employers. Explore our upcoming events!

By Lee Vikre – Hiring Jedi

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