As a business, there are certain rules and regulations you have to follow to stay on the right side of the law. One of the most common issues that arises is destroying documents on a proper retention schedule. As a business, there are naturally going to be some documents that you want to keep permanently (such as, audit reports, retirement and pension records
) however, keeping certain documents for longer than is necessary can cause just as many problems as not keeping those documents long enough.
The Problem With Keeping Documents for too Long
In 1998, Arthur Anderson LLP was found guilty of flawed accounting practices in connection with their client Waste Management. When the prosecutor began looking for documents in the Arthur Anderson offices to prove them guilty, they found Arthur Anderson employees trying to shred documents that proved their guilt. Not only did the company have to deal with the charges of flawed accounting practices, but they also had to deal with charges of trying to destroy evidence.
The tragedy for Anderson was the fact that the documents that ultimately implicated them did not need to be kept by the company as long as they had been. If the company had followed a retention schedule
, they might have avoided the charges altogether.
While the story of Arthur Anderson is a somewhat extreme example, it shows exactly what can happen when companies don’t follow a retention schedule.
Not Keeping Documents Long Enough
On the other side of the coin, it is possible that not keeping documents for long enough can lead to legal issues as well. Fortunately, there are retention guidelines available through the Better Business Bureau that advise companies on how long they should keep documents and when it is acceptable to destroy those documents.
Using a Standard Document Retention Schedule
The best way to stay on the right side of the law while not keeping unnecessary documents longer than needed is to adopt a standard process for each document type, ensuring that each one is held at least as long as is legally required.
It is worthwhile to have robust Record Management services that include records storage
, such as the services offered through Corodata. These services provide you with the tools to stay on top of your retention.
Ultimately, a strong record retention policy will prevent inadvertent wrongdoing, which can save time and headaches if legal issues ever arise in the business. The best way to stay on the right side of the law is to strictly follow your records retention policy and destroy documents when they are no longer needed.