Posts Tagged ‘information design’

Coloring inside the Lines – Designing Business Communications in Highly Regulated Industries

Wednesday, November 13th, 2013
From Don Quixote by Miguel de Cervantes.

From Don Quixote by Miguel de Cervantes.

Most designers look at regulations the way that Don Quixote looked at windmills – as an adversary that must be defeated or circumvented.

In fact, regulations are just one of several boundaries on any designer of business communications. Designs are also restricted by:

  • Corporate Identity Guidelines
  • Postal Regulations
  • Production Processes

And just as windmills are not giants, boundaries don’t need to be the designer’s enemy. In fact, identifying these factors in advance can help to focus attention on the goals of the design and also apply a filter to the process of finding solutions. The ability to understand and design for these constraints can actually become a strategic advantage for the designer.

Do you need to be an expert on every regulation? Cam Shapansky, Partner at Canada-based marketing agency Blue ID says “I don’t think the designer should become the regulatory expert, but we’ve always tried to view the regulators as a friend.” At the end of the day, compliance departments and corporate counsel exist for a reason – they are the legal experts. What is critical is that designers understand when they are working with a communication that is subject to regulatory compliance and that they engage the appropriate experts as early in the process as possible. Some designers may be tempted to simply lift-out the regulatory language that is currently used. This is a problem for several reasons; first, the product or business changes that were the catalyst for redesign might have negated the need for specific disclosures. Second the regulations (or cited regulatory agencies) may have changed or be pending change – recent examples include the renamed FINRA (replacing NASD in the footnotes of your U.S. brokerage statements) and the newly formed Consumer Financial Protection Bureau or CFPB. Third, the company’s “compliance culture” or interpretation of the regulations may have shifted since the last time the document was updated. Some companies take a very conservative approach, erring on the side of legal protection to the corporation at the cost of customer experience. This can have a major impact on the design process as well as the design itself.

Another way that companies differ in their interpretation of regulations is in the placement of compliance messaging according to Michael Ellison. As the president of Corporate Insight, an analyst firm that uses live accounts at leading financial firms to benchmark communications across all major channels, Ellison reviews a lot of statements. “Some firms dump several paragraphs of legalese onto one page in very small type, creating a dense, uninviting reading experience that adds no value to the relationship. Others sprinkle the required language throughout the document. While still dense legal-speak, the language is at least a little easier to understand since it’s presented in proper context. A third – and in our view, optimal – approach transforms regulatory disclosures into readable, plain language, presenting this required text in a way that is not distracting to the reader.”  .

Progressive companies combine “point of need” messaging with plain language disclosures to minimize complex legal language and make sure that key information is placed where it is most useful to the reader. Some language may still be clustered in one area of the statement if it is general information that is not frequently referenced. According to Shapansky, “We consider the meeting with corporate counsel to be one of the most important meetings we have with any client. You know within the first 30 seconds what type of regulatory interpretation the company is going to follow and whether they are progressive or not. “

Working directly with a firm’s compliance expert provides a much-needed opportunity to advocate for innovations that make the language and positioning more customer-friendly. Sometimes the boundaries need to be pushed and interpretations need to be challenged for the benefit of the customer – and ultimately the corporation as well. Often in challenging specific compliance “rules” it is determined that they are not rules at all but simply “guidelines” defined by some long-retired employee of years gone by.

In designing business communications, you must have a strategy for dealing with the boundary conditions you face. Will the design process be based on rigid instructions or will there be a dialogue? Will the process lean toward the customer or toward a bureaucratic norm? Will you color well within the lines or will you color right up to the outside edge of the line?

Keys to Success:

  • Understand the current interpretation. Why was the regulatory language handled in this particular way? Has the corporate or regulatory climate changed?
  • Understand the corporate culture. Do they take a conservative position or a progressive position? Do they actually have a position or are they just doing what they’ve always done?
  • Make your case for any requested changes. Will your approach have a significant positive impact on customer experience, cost or risk exposure? Can you back your claims up with competitive benchmarks or research?
  • Provide several options. There may be more than one way to make improvements. Don’t end up with the status quo, legalese interpretation because you weren’t willing to compromise.
  • Engage with compliance representatives in person (and have your corporate sponsor on board with your recommendations first.) Remember, it’s easy to say “no” in an email. It’s much harder face-to-face.
  • Document the discussions and factors that drove the decision to take a particular approach. This will help to make the decision stick and avoid revisiting issues multiple times when and if new people join the project.

Most importantly, remember that regulations are intended to inform and protect the customer.  They also protect the corporation from potential liability.  Regulations are not the enemy of design, they don’t need to be defeated or circumvented. They need to be understood and implemented in a way that serves the intended purpose – and the same could be said of any portion of content in any information design project. Once you learn enough to color inside the regulatory lines you’re much more likely to be able to influence where those lines are drawn.


Elizabeth GoodingElizabeth Gooding is the President of Gooding Communications Group and editor of the Insight Forums blog. She writes, presents and provides training on trends and opportunities for business communications professionals within regulated vertical industries.

Vertical Stuff Transaction Printers Should Know

Monday, October 11th, 2010

A quick note on some regulations that are impacting transaction documents in the Financial Services Vertical:

1. Cost Basis Reporting

2. 401(k) Fee Disclosure

The Emergency Economic Stabilization Act of 2008 is best known for the $700 billion bailout provision – but also includes new requirements for financial intermediaries  to report adjusted cost basis  to investors and the Internal Revenue Service (IRS) for securities transactions. The stated goal of the legislation is to provide investors with the means to accurately report gains or losses on the sale of securities for their annual tax filings. However – a more realistic perspective would be that the government wants a way to ensure that investors are accurately reporting gains and losses (particularly the gains!) on their annual tax filings. In 2005, the IRS estimated that the US federal government was losing approximately $11 billion in tax revenues due to the failure of investors to accurately report adjusted cost basis information and it has likely gotten worse since then.

While adjusted cost basis will be required to be reported on the 1099-B, many firms are also preparing to include  it on customer statements so that their customers are aware of the tax consequences of their trading activity. At minimum, firms are preparing messaging strategy around this issue. This legislation will impact Equity holdings (brokerage) in 2011, Mutual Funds (held directly or through brokerage) in 2012 and debt investments and options holdings in 2013. The DTCC provides a good overview of the reporting requirements and open questions. This will make statements and possibly trade confirmations and 1099-B forms longer – significantly longer for firmst that do not currently report holdings at the tax lot level.

Next on the list of regulations making envelopes fatter is the US Department of Labor who will be issuing new guidelines in the next 30 days to require 401(k) plan sponsors (employers offering 401(k) plans) to provide plan-participants (employees invested in the plan) with more-detailed information on the fees and expenses associated with the investments in their retirement portfolios. While the legislation talks about the plan sponsors, in reality, the process changes will fall on the backs of the recordkeepers who support them – companies like Fidelity Investments, T. Rowe Price, Schwab, TIAA-CREF – who are the same companies dealing with the cost basis changes as well. Investment News is a pretty good source to keep on track of changes for the 401k market – however they are more concerned with the potential litigation aspects of the issue than the impact on customer communications.

What does this all mean to you? Well, if you are a service provider, this is a great opportunity to help your clients out with redesign and plain language services to minimize the impact of providing the new information. In situations like this, the impact on page count is a concern, but the phone ringing off the hook due to new and confusing information can be even more costly in the short term. If you don’t have the expertise in-house to provide this type of vertical market redesign and consultation – now would be a good time to find a partner because the regulatory changes aren’t going to stop any time soon. With the right partner – you have a chance to be a real hero to customers struggling with these regulations – and that’s the kind of relationship you want to build right?

So keep up with the “vertical stuff transaction printers should know” and have a real conversation with your next customer or prospect.

So Many Changes, So Little Time. (Countdown to the CARD Act – Part Two)

Wednesday, August 19th, 2009

One of the cornerstones of the CARD Act of 2009 is that all the forms and statements that credit card companies send out “have to have plain language that is in plain sight.” The law makes specific requirements for each type of document in terms of content, language and in some cases even type size. The requirements were based, in large part, on extensive consumer research sponsored by the Federal Reserve. An overview of the research and results can be found at

For card issuers already struggling with portions of the Act that go into effect this week (see Countdown to the CARD Act Part One) the clock is ticking to get all of these changes designed, coded and tested in advance of the February 2010 deadline. I’ve summarize the key content and formatting changes to each type of document below.