Companies Facing New Regulatory Pressures to Audit Electronic Communications
CeBIT 2004, Hanover, Germany — 18th March 2004 — New corporate accountability regulations are forcing companies to take a tougher approach to recording and monitoring staff emails and instant messaging (IM), concludes the latest Storage Index survey commissioned by Hitachi Data Systems*.
The survey of large and medium-size enterprises across Europe, the Middle East and Africa* found that more than half of firms (56 percent) now routinely monitor employees' email messages, while even more (61 percent) centrally archive all emails. At the same time, more than a third of companies (36 percent) actively monitor IM communications, and the vast majority (68 percent) have put in place explicit staff guidelines for both email and IM usage.
While such measures may be unpopular among workers with more dubious email and IM habits, the introduction of new corporate accountability regulations, such as the Sarbanes-Oxley Act, have led many companies to review their electronic communications policies. This is particularly true in heavily regulated industries such as financial services, where companies face severe penalties for failing to comply with communications auditing requirements.
| Proportion of companies routinely monitoring staff communications | ||
| Country | Email | IM |
| Austria | 50% | 40% |
| Belgium | 57% | 40% |
| Denmark | 30% | 20% |
| Finland | 44% | 29% |
| France | 71% | 60% |
| Germany | 51% | 41% |
| Israel | 57% | 41% |
| Italy | 57% | 23% |
| Netherlands | 66% | 31% |
| Norway | 50% | 32% |
| Poland | 67% | 17% |
| South Africa | 50% | 40% |
| Spain | 77% | 70% |
| Sweden | 30% | 13% |
| Switzerland | 50% | 47% |
| UK | 62% | 22% |
| EMEA average | 56% | 36% |
According to Hitachi Data Systems, the introduction of stricter, more efficient email management systems is also seen as key to minimising the storage costs associated with spiralling volumes of messages. A recent survey by the data storage specialist found that email messages (including attachments) can take up more than 40 percent of a company's data storage capacity.
However, this latest survey also highlights substantial variations between companies and across the region.
For example, among those companies that do not currently monitor email or IM use, some 60 percent were unable to say when they would be in a position to do so. Moreover, in some countries, the number of companies recording and monitoring staff communications is less than half that reported in other countries.
The survey also raises serious concerns over the length of time companies retain email and IM data. Although emerging regulations stipulate that electronic communications are archived for anything up to eight years, fewer than one in five firms (18 percent) currently retain email messages for more than three years.
| Proportion of companies routinely archiving staff communications | ||||
| Email | Instant Messaging (IM) | |||
| Country | For less than 3 years | For more than 3 years | For less than 3 years | For more than 3 years |
| Austria | 37% | 23% | 20% | 17% |
| Belgium | 70% | 7% | 40% | 0% |
| Denmark | 37% | 27% | 13% | 10% |
| Finland | 35% | 9% | 9% | 3% |
| France | 45% | 10% | 37% | 3% |
| Germany | 31% | 30% | 13% | 5% |
| Netherlands | 53% | 22% | 9% | 9% |
| Israel | 33% | 30% | 10% | 7% |
| Italy | 73% | 7% | 43% | 3% |
| Norway | 44% | 9% | 15% | 6% |
| Poland | 60% | 10% | 7% | 0% |
| South Africa | 27% | 33% | 17% | 7% |
| Spain | 70% | 33% | 53% | 10% |
| Sweden | 27% | 17% | 0% | 0% |
| Switzerland | 47% | 30% | 27% | 23% |
| UK | 40% | 19% | 7% | 2% |
| EMEA average | 43% | 18% | 20% | 6% |
Even more worryingly, barely one in twenty firms (6 percent) retains IM messages for more than three years, while three-quarters do not archive IM messages at all. This is despite the fact that IM has been recognized as the fastest growing communications medium of all time2. Analysts have estimated that around 70 per cent of enterprises have some sort of IM client running, whether they are aware of it or not3, underlining the problem facing IT departments in managing what was originally designed as a consumer communications tool4.
"New accountability regulations and IT cost pressures are clearly starting to have an impact on corporate communications. Over the next year or so, we expect to see most companies making significant investments in email management systems and similar technology." says Tony Reid, Director of Solutions Marketing (EMEA) at Hitachi Data Systems.
"We should probably just feel fortunate that so many companies have got away for so long without effective management of such business-critical communications tools," adds Reid.
*Research note
This survey was conducted as part of the next `Hitachi Data Systems Storage Index', due for publication in spring 2004. This is an independently-conducted study commissioned and owned by Hitachi Data Systems.
Findings are based on 690 anonymous interviews with IT director throughout the EMEA (Europe, Middle-East and Africa) region. The countries surveyed were: Austria, Belgium, Denmark, Finland, France, Germany, Israel, Italy, Netherlands, Norway, Poland, South Africa, Spain, Sweden, Switzerland and the UK.
About Hitachi Data Systems
Hitachi Data Systems leverages global R&D resources to develop storage solutions built on industry-leading technology with the performance, availability and scalability to maximize customers' ROI and minimize their risk. By focusing on the customer's perspective as we apply the best hardware, software, and services from Hitachi and our partners, we uniquely satisfy our customers' business needs.
With 2,700 employees, Hitachi Data Systems conducts business through direct and indirect channels in the public, government and private sectors in over 170 countries and regions. Its customers include more than 50 percent of Fortune 100 companies. For more information, please visit our Web site at www.hds.com.
About Hitachi, Ltd.
Hitachi, Ltd. (NYSE: HIT), headquartered in Tokyo, Japan, is a leading global electronics company, with approximately 340,000 employees worldwide. Fiscal 2002 (ended March 31, 2003) consolidated sales totaled 8,191.7 billion yen ($68.3 billion). The company offers a wide range of systems, products and services in market sectors, including information systems, electronic devices, power and industrial systems, consumer products, materials and financial services. For more information on Hitachi, please visit the company's Web site at http://www.hitachi.com/.
Shirley Virando Hitachi Data Systems +44 (0) 1753 618682 shirley.virando@hds.com
© 2003, Hitachi Data Systems Corporation. Hitachi Data Systems is registered with the U.S. Patent and Trademark Office as a trademark and service mark of Hitachi, Ltd. All other trade names, trademarks, and service marks used herein are the rightful property of their respective owners.
1 Regulations such as the Sarbanes-Oxley Act, SEC rule 17a-4 and NASD 3110 make auditing of all electronic communications (including email and IM) a mandatory requirement.
2 In its first five years, IM has grown more than 30% faster than email at its inception, according to Forrester Research, Gartner, Inc. believes that IM traffic will surpass email traffic by 2006. IDC projects that overall usage numbers to grow at an average of 110% for the next several years.
3 Source: Gartner, Inc.
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