Electronic information is potentially admissible before courts of law, although evidential weight is called into play. Email that is centrally managed and stored in a way that cannot be tampered with improves its evidential weight. This increases an organization's chances of being able to use email evidence offensively in litigation rather than being limited to having email used against it.
Recent high profile fraud cases such as at Enron have hinged upon proving who knew what, when, and have required the forensic investigation of email history. More day-to-day court proceedings concerning harassment, contract law etc. can also hinge on email evidence, which can be used by or against the organization.
In these circumstances it is in the organization's interest to be able to present a complete and accurate record of email discussions which is tamper-evident and easily searched by those with authority to do so. Critically, if you can then prove that 'email can't be shredded' you can not only show that an email was sent, but also that it wasn't.
Interestingly, some organizations' initial response to this issue is to be concerned that a compliance level email repository will store evidence that might incriminate them, and therefore is somehow a bad thing. However, more detailed thought usually leads responsible organizations to the conclusion that corporate governance is essential to a successful business. More than ever in the post-Enron world, it is clear that if anyone is breaking the law within a company, it is in the company's long term interest to be able to discover it, stop it, and assist the authorities fully with any legal action required. This in itself is naturally a deterrent against illegal actions by employees and owners.
Besides, deleting all reference to a particular email is a lot harder than many people imagine. What about data held on nightly and then separate weekly backup tapes? Were messages forwarded to others inside or outside the organization? Post any supposed deletion, what about magnetic 'images' that may still reside on computer disks after supposed deletion only to come to light in the event of a later forensic investigation? Even if a complete purge is successful, from an evidential point of view, does one party wish to leave others as the only record holders of events?
Organizations also need to be careful during any technology upgrades, that for example when migrating from one email system to another, important metadata and other forensic information is not lost.