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The MAS has proposed guidelines to improve the quality and clarity of forms used in the financial advisory industry. If you offer financial advice, now is a good time to review your forms and seek feedback from clients and those who work closely with them.
The MAS guidelines have been proposed in response to issues they have seen on the quality of forms used across the financial advisory industry. Poor documentation designs may have confused certain clients, which in turn, may have resulted in complaints or breaches. The guidelines encourage financial advisors to take a customer-centric approach to help clients better understand the advisory and sales process.
| The MAS’ guide to good form design |
| As a financial adviser, you must collect relevant information about your client before recommending a suitable investment product. The MAS guidelines provide three principles to designing your forms to help your clients better understand your sales and advisory process. |
1. You should use clear and concise language. To this, you should:
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2. Your form should have a reader-friendly layout. To this, you should use:
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3. Your form should be efficiently designed. To this, you should:
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Implications
Financial advisors always have had to balance their business with applicable regulations aimed at the best interests of clients. Advisors are now challenged to apply this extra dimension to their documentation. Not only must forms meet regulatory requirements but they also need to ensure that clients can easily understand them. However, this challenge comes with a degree of flexibility: the financial advisor can decide how best to phrase their documentation to suit their clientele’s understanding.
A well-designed form, however, is not a silver bullet to ensure full client understanding of the advisory and sales process. It should be viewed as merely a tool in the hands of the financial advisor’s client-facing staff, who remain at the forefront of your client’s advisory and sales experience. Again, with the client’s interests in mind, such staff will need to be equally attentive to their client’s understanding of their advice and of the advice itself.
Next steps
While waiting for the MAS guidelines to be issued, you may wish to seek feedback on the client-friendliness of your forms. Client-facing staff and even clients themselves may be able to help you identify where greater clarity is needed.
You should be aware that the guidelines are not exhaustive and that your forms still could lack good design if they are followed to the letter. Therefore, approach good design as an outcome, best judged by your clients, and continue to review your forms accordingly.
In the drive to redesign your forms, you should be careful to not oversimplify them to the point where the form’s contents are no longer fit for purpose, where the form fails to meet regulatory requirements or no longer protects you from liability.
How we can help
We review your client-facing documentation for flow, clarity and readability, as well as for compliance with all regulatory requirements.
Your front-line staff ensure the best experience for your clients. We can help you develop training for them on your advisory and sales process to complement your client-facing documentation.
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