Mastering Budget Management: Best Practices for ERG Leaders

Published July 17, 2024

Pull up a chair — employee resource groups (ERGs) now have a seat at the table. They're evolving from their roots in diversity, equity and inclusion to become pivotal elements of organizational culture and social impact. According to the State of Corporate Purpose 2024, four out of five companies acknowledge the growing significance of ERGs.

But, in order to maximize their influence and impact — and get more investment — ERGs and the people who run these programs need to be able to easily manage their budgets and report back on the return on investment. These best practices will help.

Set the foundation for effective budget management

Everything is easier when your ERG budgets are clear and transparent, and ERG leaders and members can see what's been allocated, what's been spent and what balance remains. 

Best practices: 

• Implement a centralized financial dashboard: Offer a holistic view of finances, ensuring that all financial activities are visible at a glance, in real-time. This helps ERG leaders make informed decisions, track spending against budgets, and spend responsibly. 
• Regular financial reviews: Scheduled financial check-ins make it easier to stay on top of the health of your budget. This proactive approach ensures that you're in line with your goals and making the most of your funds, while also avoiding any unexpected budget issues. Plus, you can measure the impact of your spend and advocate for more funding.

Create a forward-thinking financial strategy

Prevent a last-minute scramble for resources by anticipating the future needs of your program. 

Best practices: 

• Build a reserve fund: “Rainy day” funds are crucial for weathering unforeseen financial needs. This acts as a safety net, ensuring that your ERG program activities continue seamlessly, even in the face of unexpected costs. 
• Forecast future spend: Forecasting financial needs can set the stage for realistic budgeting and help you prepare for future program expenses.

Streamline your processes

“Process over perfection” should be a saying because efficient processes lead to less administrative work — and more time to grow your program and make strategic decisions. 

Best practices: 

• Standardize request and approval workflows: This ensures consistency and fairness in budget management, reduces confusion and speeds up your approval process.
• Automate where possible: Reduce manual labor, and maintain organization and accuracy, with automated budget alerts, digital processing of receipts and invoices, and more. 

Cultivate accountability and engagement 

When ERG members understand how budget decisions are made and see transparency in financial management, their trust and involvement in the ERG can increase. 

Best practices: 

• Communicate financial decisions: Transparent communication about financial decisions, and regular budget updates, can deepen members' understanding of how the budget is being allocated to create impact within the company and the communities it serves, and promote a sense of shared responsibility. 
• Encourage member input: Involving members in financial decisions and planning, like choosing guest speakers or which nonprofits to support with ERG-directed grants, fosters a democratic process and aligns the budget with members' needs and priorities.

Beyond the numbers

Effective budget management for ERG programs isn’t just about tracking numbers. It encompasses strategic planning, efficient processes and robust member engagement. When done well — and when you have purpose-built software to make it easy — it’s one of the best ways ERG program leaders can measure and report on the impact of their programs.

See how you can efficiently manage your ERGs, and their budgets, with Benevity Affinity Groups.