This setting is no longer included in new Data Encryption policies created in ZENworks 11 SP4 or newer versions.
If your policy includes this setting, it is because 1) the Data Encryption policy was created in a ZENworks 11 SP3 or earlier version and 2) the setting was enabled. You cannot modify the setting, but the setting will continue to be enforced on any device (regardless of ZENworks Adaptive Agent version) to which the policy is assigned. If you no longer want the setting applied to a device, you must assign the device a new Data Encryption policy that does not have the setting.