Firms are failing to adopt record management policy

With rising commercial rents, file storage is now a significant cost factor, writes Claire Shoesmith

When you go to see your local doctor you expect him or her to have your records to hand and to be able to lay their finger quickly on any documents detailing previous ailments or allergies before treating you for a new illness. The same goes for homeowners who file their home's deeds away with their bank or mortgage provider. They expect the organisation to keep the documents safe until such a time as they may be needed.

What you don't want to find is that, years after you have switched doctors or the mortgage has ceased to exist, the organisation continues to hold detailed personal information about you.

In theory you have the Data Protection Act to thank for that. However, in practice, many companies have so much information in storage they often don't even know what information they have.

"For many companies the lack of a proper document storage policy is the main problem when it comes to the retention of information," says Cecil Ryan, managing director of Document Management services (DMG), which provides data listings and information storage and destruction systems.

"What they often don't realise is that the way in which they destroy information can often be equally as important as how they choose to retain it."

According to a recent survey by DMG, 62 per cent of Irish companies have no policy in place for the safe and secure retention and destruction of documents. Moreover, 35 per cent of those surveyed said their approach to document storage had caused a considerable drain on work time as staff members searched for old files.

A lot of the issues can be traced back to uncertainty, according to SeáSweeney, senior compliance officer at the Office of the Data Commissioner. In line with a 2003 amendment to the Data Protection Act, public and private institutions in the Republic are required to retain all information only for as long as a relationship exists between the organisation and the individual concerned - for the life of a mortgage or a car loan. Previously, this only applied to electronic data.

Company executives can now personally be held responsible for any information that is deliberately held for longer than necessary - with possible fines of up to €100,000 - while individuals can also sue companies that fail to produce information they are required to hold on demand.

Martin Bradley, a consultant on records management, believes the Republic is a long way behind Britain and many other parts of Europe when it comes to document storage and destruction because of a lack of guidance.

"Companies are becoming increasingly aware of the need to store and destroy information appropriately, but are often unsure of the guidelines," he says, adding that while the subject of record keeping appears in almost every piece of Government legislation, what is actually needed is one single piece of legislation dedicated solely to this purpose.

Another issue that can be solved by having an effective document retention policy is that of space. While the dawn of the internet age and the emergence of e-mails was supposed to produce the paperless office, it did in fact do exactly the opposite, says Bradley. A survey conducted by the University of California, Berkeley, in 2002 found that offices worldwide used 43 per cent more paper than they did in 1999.

According to DMG, the average company gives over about 6 per cent of its office space to document storage and, in a market like the Republic, which has some of the highest commercial rents in Europe, this may not be the best use of resources.As a result of all this, and the concern that tighter compliance rules introduced in the US may soon find their way into Ireland, effective record management has become an increasingly essential part of modern organizations, says Bradley.

Despite DMG's survey showing many companies' failure to adopt a proper document storage policy, a separate study, released this week by Experian, shows that when it comes to direct marketing campaigns, Irish companies rank third in Europe in ensuring the data they hold on consumers is accurate and compliant with the data protection laws. However, such data is most likely electronic, and this has been subject to specific laws for longer than paper documentation.

As companies become more aware of the issues, business is changing for DMG and its rivals.

"In the past people used to come to us when they were running out of space or they had made a mistake by losing a particular file," says Ryan. "But recently it has become much more about the efficient running of their business, reducing costs and compliance issues."

As Bradley says, companies spend vast amounts of money installing firewalls and internet security systems, but the loss of one important paper document can cause just as much havoc with the business.

"At least if you have a policy you know where you are," he says. "Whether you keep files for seven, 10 or however many years, you will know whether you have it or you don't."