When the pandemic shuttered offices around the world, forcing everyone to work from home, some organizations transitioned with few problems. And while others adjusted more slowly, most have come to enjoy the flexibility of remote work and remain productive as ever, if not more so.
Support for this argument comes from a recent poll, which found that only about 3% of white-collar professionals worldwide want to return to the office full time. No doubt in an effort to attract and retain top talent, companies have taken note. For instance, Microsoft’s newly announced office reopening plan “embraces schedule flexibility.”
Financial services is different from other industries, tending to lean more heavily on face-to-face meetings. Yet more executives are beginning to accept that staff will, at least for the time being, continue to work from home (or elsewhere), even as today’s tech-driven workplace has created headaches for internal compliance, regulatory and legal professionals.
For proof, think about e-discovery. When email was the primary form of business communication, many of the current legacy systems could identify, protect and produce information under compressed, high-pressure timelines.
However, that changed once the pandemic hit. The emergence of Slack, Zoom, Microsoft Teams and other communication and collaboration tools has made this task far more complex, thanks to the massive uptick in the volume and variety of messages flowing through every business.
Indeed, whereas deconstructing an email chain for legal review purposes is a somewhat orderly process, the same cannot be said about these other platforms. Consider Slack. Each channel is a recipe for a discovery nightmare, with every message, participant, like, edit, attachment or other action considered a separate item.
Grouping and sequencing each of those data points is time-consuming and brutally complicated, perhaps involving as many as 100,000 pieces of information. Naturally, this would make it difficult, if not bordering on impossible, to reconstruct the context of a conversation to identify responsive content (As you can imagine, doing something similar for a Zoom video meeting would be exponentially more daunting).
All of this is why proactively capturing and preserving historical content has never been more critical. However, the 2021 Smarsh Annual Risk and Compliance Survey Report makes it clear that few firms are doing this. Of the 83% of firms that allowed conferencing tools, the survey found that only 22% had established retention and oversight programs for the resulting communications content.
Again, why this gap exists is well understood — woefully outdated archiving systems. But in failing to update them, firms have adopted the mindset of someone who decides daily exercise and a healthier diet are important only after they experience a severe heart attack.
Discovery and litigation are a reality of doing business in financial services. By relying on legacy archiving systems to tackle the challenges associated with today’s communication environment, firms are, to expand on the above metaphor, eating fast food every day and shunning all types of physical activity.
It represents a failure to manage data according to its risk and value — a fundamental governance principle for any business. But more than that, it’s an invitation for excessive levels of regulatory exposure, almost as if it’s an unavoidable operating cost.
To be sure, the stakes are as high as ever. Regulators have accepted that mobile devices, collaborative tools and conferencing apps are the lifeblood of any organization. Consequently, courts — which always assume the worst when a company can't produce bits of information upon request, especially when they are required to collect it — will be as unsparing as ever.
Therefore, firms need purpose-built tools to manage their discovery responsibilities. It’s only a matter of time until a significant case turns on a piece of evidence embedded within a Slack chat, a Zoom meeting or somewhere on TikTok or Instagram. The time to prepare for that reality is now.
Robert Cruz is vice president of information governance for Smarsh.
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