June 14, 1994
TO: RESEARCH COMMITTEE NO. 18-94
SEC RULES COMMITTEE NO. 62-94
SHAREHOLDER COMMUNICATIONS COMMITTEE NO. 13-94
RE: REQUEST FOR MARKET SURVEY RESEARCH
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The North American Securities Administrators Association
recently formed the Disclosure Reform Committee ("Committee") to
develop recommendations to improve existing disclosure requirements
and practices in the securities industry. The primary goal of the
Committee is to produce a report by the end of the year that
identifies and describes reform measures necessary to increase the
readability and adequacy of disclosure documents.
The Committee and its Advisory Group, which includes the
Institute, recently met to discuss the Committee's projects and
possible methods to accomplish these projects. The Committee
determined that basic information about the "average investor" and
the financial literacy of the "average investor" is necessary in
order for the Committee to make informed recommendations on ways to
improve disclosure.
The Institute has been asked to gather market survey research
from its members to share with the Committee. Of particular
interest to the Committee is research relating to the type of
information investors rely upon in making investment decisions, and
the financial literacy of the average investor. Also, if your fund
complex has simplified the language in disclosure materials
provided to investors (e.g., annual reports, prospectuses), we
would be interested in receiving information on the effectiveness
of these changes. A copy of the Committee's request for
information to the Institute is attached.
If you or anyone within your firm has any information or
recommendations on the foregoing, please provide them to me by
Friday, July 1, 1994. Given the sensitive nature of this type of
information, the Committee has assured the Institute that any
information provided to it will be kept confidential. If you have
any questions, please contact Patricia Louie, Associate Counsel
(202/326-5821), or Sandy West, Director of Marketing Research
(202/326-5912).
Paul Schott Stevens
General Counsel
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