Document retention policies are fundamental business tools that appropriately address the creation, retention and disposition of corporate actions. The United States Supreme Court recently noted: "Document retention policies, which are created in part to keep certain information from getting into the hands of others, including the Government, are common in business . . . . It is, of course, not wrongful for a manager to instruct his employees to comply with a valid document retention policy under ordinary circumstances." Arthur Andersen v. U.S., 125 S.Ct. 2129, 2135 (U.S. May 31, 2005). The failure to properly maintain and monitor a corporate records retention policy can create substantial risk for both the corporation and its employees, particularly in light of the Sarbanes-Oxley Act and expanded interest in corporate conduct.
In today's corporate world, more than 90% of communications and business activities take place in an electronic environment. Current trends in pre-trial discovery also have focused on electronic communications, substantially increasing costs and risks. However, many corporate records retention programs do not adequately address the creation, management and disposition of electronic records. Therefore, it is increasingly important for companies to evaluate and consider how their records management programs impact electronic records.