Element is end to end encrypted by default for private rooms and 1:1 chats, but the Matrix protocol does not mandate the use of end to end encryption since it doesn't make sense for some use cases, particularly for public world readable rooms and IoT application.

There are organisations today that use Element without e2ee, though in practice we find that most see e2ee as a plus point - especially with the recent UX improvements (https://element.io/blog/e2e-encryption-by-default-cross-sign...).