Your editorial, We’re not there yet on plain language, is right to highlight how much financial communications still lean on jargon and dense disclosure. We have had two decades of initiatives — from the Bank Act reforms that created the Financial Consumer Agency of Canada to the introduction of Key Facts, Fund Facts and ETF Facts — yet most materials still read like they were built to satisfy process rather than inform consumers. That critique stands. What I question is the implied remedy: that the answer is to keep dumbing down the writing until it becomes clear.
Plain language is necessary; oversimplification is not. When we strip out context to make a paragraph shorter, we often remove exactly what a client needs to make an informed decision: the economic trade-offs, the costs that compound, the penalties that bite if they exit early and the conflicts that shape recommendations. This converts disclosure into slogans. It may reduce complaints about readability, but it does little to improve decisions.
To achieve improved outcomes, attention should move away from merely supplying investors with more readable materials and instead prioritize equipping them with actionable insights and comparable data at the point of decision-making. Specifically:
- Decision-time essentials. Provide a concise, standardized disclosure block — including all-in fees, liquidity and exit penalties, key risks, advisor compensation and potential conflicts of interest, as well as realistic outcome ranges — at the point where client consent is requested. This approach eliminates the need for clients to search through multiple documents.
- Present information in a structured manner, avoiding oversimplification. Begin with five or six key, non-negotiable facts and subsequently provide opportunities for deeper exploration. Employ clear, straightforward language without sacrificing nuance; clarify implications such as potential changes if rates increase, early redemptions are required or if recommendations are limited to proprietary products.
- Comparability by design. Present recurring costs and incentives in a standardized template to enable side-by-side comparison. If products are not directly comparable, state this clearly and describe the limitations.
- Active comprehension checks. Replace “I have read and understood” tick-boxes with brief, decision-relevant prompts (e.g., “If you redeem in the first 24 months, the early-exit charge could be up to $X — proceed?”). Measure whether clients can accurately answer a couple of key questions before they sign.
- Feedback loops that matter. Test documents with real clients, publish aggregate comprehension results and iteratively improve materials. Readability scores are fine; demonstrated understanding is better.
Regulators and firms have already shown they can standardize summaries; now the task is to make them decision-useful. That means moving from document-centric compliance to outcome-centric design at the point of sale. Plain language should support that aim — not replace it.
In short, don’t dumb it down. Make it useful at the moment it counts.