Step1: Open the O365 Admin Center
Step2: Next, click Show All (admin centers) and then click Security.
Step3: Next, in the Security / Microsoft 365 Defender Admin Center, under Email & Collaboration, click on Policies & rules.
Step4: Here, click on Threat Policies
Step5: Under Threat policies, click Anti-Spam.
Step6: Under the Default Anti-Spam outbound policy (Default) we will probably find Automatic Forwarding is set to Automatic – System-Controlled.
Step7: Close the Default Policy and then at the top of the screen click the + Create Policy drop-down and choose Outbound
Step8: In the new Outbound policy, edit the description to something like “Custom Outbound “, and add the Users or Groups to the policy (whom you want to give the ability to forward.)
Step9: At the bottom of the new customs policy change Automatic Forwarding to On – Forwarding is enabled
Step10: Save and close the new policy and that should do it. Try sending some test messages to see if the forward works correctly. We may need to change the new policy’s Priority to 0 if something still isn’t working. Also, don’t forget to double-check the Automatic Forwarding on the mailbox itself.