The Financial Conduct Authority (FCA) has published its Discussion Paper on a Future Disclosure Framework.
In response, Dr Matthew Connell, director of policy and public affairs at the PFS, said: “The PFS welcomes the FCA’s review of the disclosure framework. The EU disclosure regime for investors did not work well for consumers for two reasons. Firstly, it was not based on rigorous consumer research, so the content and format of the information given to investors was not based on what investors needed to know, when they needed to know it, or in the best format to engage consumers.
“Secondly, the disclosure information for consumers also relied on a high degree of wishful thinking about the power of distributors over product providers. This is because issues around standardisation of information from investment houses were not addressed properly by EU regulators. Instead these issues were left to distributors to resolve. For example, regulators did not establish proper, standardised approaches to transaction costs within investment funds and instead left it to distributors to request information from providers that those providers were unwilling or unable to deliver.”
Dr Connell concluded: “The new rules must also be based on rigorous consumer research built around the real-life interactions that consumers have with advisers and investment providers and should recognise changes in technology that can improve both the presentation of information to consumers and the ability of advisers to keep records.”
The discussion period ends on 7 March 2023.
To find out more and contribute to the discussion, visit: https://bit.ly/3Jjpfe8
