Investment firms still have a Plain English problem…
In July, the Financial Conduct Authority (FCA) published research findings that said just 6% of investment product disclosure documents were written in language plain enough for consumers to understand.
Yes, that’s right: 6%.
The reason it’s so low? “Word complexity”.
Jargon, technical phrases, complicated and challenging words.
“We expect firms to explain product disclosure information in plain English to help consumers understand and feel confident investing.”
Why this matters now
As the FCA explains, the research is part of the broader plan to encourage investment firms to improve the information they provide to investors before the Consumer Composite Investments (CCI) regime is officially brought in on 8 June 2027. The CCI regime is intended to give consumers clearer information to help them choose investment products. But essentially, the onus is on investment firms to “present the disclosures in a way that promotes consumer understanding, with standardised requirements limited to costs, risk and return and past performance information”.
“We expect readability and intelligibility to improve under the new regime.”
I’ve spent the last 25 years working with investment companies to adopt Plain English principles. I’ve worked hard to convince them the entire document needs to be easy to understand, including the disclaimers. I’ve had language battles with legal and compliance teams, and we’ve mostly managed to find a good compromise.
Because making investment literature easy to read is better for business, for customers and the industry as a whole. But clearly, there’s still a LONG way to go. And the FCA is now monitoring this closely.
So, if you found this 6% stat as troubling as I did – and you’re worried your firm’s content might be part of the problem – don’t take this as a criticism, but as an opportunity to act now before the FCA forces you to.
If you want your content to stand out for the right reasons, and to get an edge over 94% of your competitors, let’s have a conversation about where Flight to Quality® can help.
