Would be very grateful to hear how people are approaching Records Retention policies for Microsoft Teams Chat. Do you have one? If so what is the retention period you have set? Has this always in place? If not, how did you approach the change and how was it received?  

We treat Teams and Slack interactions as two different types for retention purposes:

1. Chats - these are ad-hoc, 1:1/group chats in the "Chat" tab. They are considered disposable, unstructured and similar to Skype/Lync. These have a short-term deletion policy of around 45 days.

2. Channel Conversations - these are structured, follow a topic, get work done and are considered equivalent to high-speed email. These follow the email retention/deletion policy of multiple years, depending upon role and audit/legal requirements.

This keeps things simple and clear. A side benefit is that knowledge accumulates within structured discussions while keeping knowledge from accumulating in fragmented casual chats.

It was a bit of a cultural change, but we had prior retention policies for IM and email, which provided a precedent to map to.

My company implemented 3years retention policy for Teams Chat, One Drive files and emails.
If the documents/emails are needed to retain more than 3 years, it should be uploaded to SharePoint Online as official Business file.