The alternative to having a document retention policy is to just have employees delete things in an arbitrary manner. It's not just CYA for leaving inconvenient doc lying around, it's also to ensure the proper retention in the event of a preservation order or public records request.
Some companies go way further than others. One place I worked included "notes of a personal nature (eg, birthday cards)" in the retention policy and let us keep them for a week or two before destruction.
This sets a general policy of deleting documents/emails/etc after $X days. This is really a CYA policy to purge old conversations if a big lawsuit comes down asking for document retention in relation to some scandal, and if its older than $X days you're covered since your standard legal process was followed.
Attorneys who sue or investigate people for a living want everything forever, and those who get sued want to delete email before it arrives.
Email is a great way to get in trouble, as people tend to say dumb things, even about things that they have nothing to do with!