United States
New York , 26 January 2011

Despite fears they may be irrelevant to the new generation of supposedly post-feminist, multicultural workers, Employee Resource Groups (ERGs) – also known as employee networks and affinity groups – are enjoying a renaissance at some organizations and having a positive effect on business success, finds a new study by Mercer’s Equality, Diversity and Inclusion practice.

ERGs Come of Age: The Evolution of Employee Resource Groups is an analysis of employee networks in 64 organizations. The study – which can be downloaded free of charge at http://www.mercer.com/ERGreport – was conducted with funding from the nonprofit educational organization Industrial Relations Counselors, Inc.

The study found that many companies are experiencing a resurgence of enthusiasm for ERGs, both those organized around traditional affinities such as race and gender and newer groups that are intentionally inclusive, such as multicultural and multigenerational groups, or that are based on common interests, such as the environment.

The most prevalent ERG focus areas reported by study participants are women (93%), race/ethnicity (90%) and lesbian/gay/bisexual/transgender (84%). Other ERG focus areas include disability (52%), generational (48%), multicultural (43%), working parents (35%), military service (34%), single religion (16%), adoptive parents (13%), elder-care responsibilities (11%) and interfaith (9%). (See Figure 1.)

“For 30 years, ERGs have helped women, ethnic minorities, gays and lesbians, and other demographic groups navigate the corporate world,” said Michal Fineman, a consultant in Mercer’s Global Equality, Diversity and Inclusion practice and the study’s chief author. “Many of the new generation of employees don’t tend to identify as strongly as their older colleagues with race and gender affinities, leading some to question whether ERGs are relevant today. This new study concludes that they are alive and well and, furthermore, that they can serve an important business purpose.”

Estimated membership rates in the companies that participated in the study range from less than 1% to more than 20% of employees worldwide. Among the 64 organizations surveyed, 8.5% of the workforce in US-based companies and 4.3% in organizations headquartered outside the US belong to one or more ERGs, on average,

The new commitment to ERGs is evidenced by the level of support they receive in large companies. The average annual budget for ERGs reported by survey participants was $7,203 for every 100 ERG members, and many companies spend well into six figures every year (not counting the cost of technology, facilities, staff support, and other non-financial resources provided to the groups).

Companies also devote significant staff time to making their ERGs successful. On average, the surveyed companies have 1.4 full-time equivalent employees dedicated to the management, coaching and coordination of their ERGs, not to mention the time spent during the workday by ERG members, executive sponsors and others who coach and train ERG officers, meet with the groups and participate in events.

“Three trends appear to account for the rebirth of the ERG movement in large firms,” said Ms. Fineman. “First is the emergence of the ‘millennial generation’, whose members are comfortable using social media to work collaboratively. Second is the globalization of ERGs, which are drawing interest from a new potential membership base in Europe, Latin America and Asia. Most importantly, ERGs have an increasingly business-oriented focus in their missions and activities, which earns them more respect and involvement from business leaders and gives members greater visibility in the organization.”

Notes for editors
The full report ERGs Come of Age: The Evolution of Employee Resource Groups can be viewed at http://www.mercer.com/ERGreport. The majority of the 64 participating organizations are for-profit companies; a small number are primarily government contractors or themselves part of government. Most (67%) are multi-regional or global; three-fourths (76%) are headquartered in the US. Participating organizations range in size from 1,600 to 380,000 employees with a median of 32,000.

Mercer’s Global Equality, Diversity and Inclusion practice, acquired as part of the acquisition of ORC Worldwide last summer, began in the early 1960s in the US and today includes Europe. The practice is headquartered in New York and London.
 
About Mercer
Mercer is a leading global provider of consulting, outsourcing and investment services. Mercer works with clients to solve their most complex benefit and human capital issues, designing and helping manage health, retirement and other benefits. It is a leader in benefit outsourcing. Mercer’s investment services include investment consulting and multi-manager investment management. Mercer’s 20,000 employees are based in more than 40 countries. The company is a wholly owned subsidiary of Marsh & McLennan Companies, Inc., which lists its stock (ticker

symbol: MMC) on the New York and Chicago stock exchanges. For more information, visit www.mercer.com.