A new study from Smarsh UK reveals that financial firms do not have adequate archiving and supervision systems in place to manage their regulatory obligations to retain and oversee electronic communications in line with, among other things, recent pronouncements from the Financial Conduct Authority regarding social media and communications with customers.

The 2015 UK Electronic Communications Compliance Report found the British financial firms allow the use of social media and mobile messaging as essential business communication channels. Despite this widespread acceptance of social media, however, firms are struggling to come up with adequate archiving and supervision strategies and systems. Smarsh is a major archiving and "compliance in the Cloud" IT firm.

The report shows that half of the businesses that Smarsh canvassed do not have archiving IT systems in place for mainstream social media channels such as LinkedIn (58%) and Twitter (56%), or for mobile/SMS text messaging (58%). Smarsh says that they ought to act quickly to avoid costly lapses in compliance and retention.

Insights from the report, conducted specifically in the British market for the first time, show that financial firms collectively realise the power of social media and allow the use of channels such as LinkedIn (72%), Twitter (60%) and mobile/SMS text messaging (56%) for business communication. However, almost half (46%) of those businesses in the survey said that the new and changing regulations were a growing concern in terms of electronic message compliance. Businesses also cited the increased regulatory scrutiny (44%) and their ability to deal with emerging e-communication channels (39%) as 'challenging'.