Bank of England analyst, Jonathan Fullwood, has told the UK finance sector to cut the financial ‘gobbledygook’ otherwise it risks continuing the ‘great divide’ between banks and the public.
Terms such as ‘bear market’, ‘credit correlation’ and ‘operational risk’ may be the norm for those working in finance but to the general public they are incomprehensible jargon, Fullwood warns.
Writing in a post for Bank Underground, Mr Fullwood had this to say about the language the financial sector uses; “How much of what… the financial industry in general write can actually be read by a broad audience?… [It] must try harder if claims of accessibility are to be meaningful.”
To put together his research, Mr Fullwood, analysed a selection of financial reports along with terms and conditions issued to customers and looked at them in comparison to newspaper articles and political speeches. He looked at things such as sentence length and average syllables per word, he then rated the documents based on school-grade reading levels.
He found that documents from private banks require a reading level of grade 12 (equivalent to age 16 to 17) and the Bank of England’s content is around grade 14 level. However, for the text to resonate with a wide audience it should be written at a grade 8 or 9 level. This shows a big difference in reading grades and shows why the public is so confused by the financial sector.
In comparison, political speeches are rated at grade six (primary school level) and newspaper article average at grade nine. To truly understand what all this means, Fullwood included the reading grades for some of the world’s most famous authors. Jane Austen is around grade seven and Emily Bronte is grade eight, six grades lower than a Bank of England speech.
Fullwood, along with the Campaign for Plain English, feel that financial institutions need to simplify their language and they advocate clearer writing to help the public re-engage with the banks. Long words, long sentences and long paragraphs all contributed to the high reading grades for financial content leaving the public with little clarity over subjects raised.
Chrissie Maher, who began the Campaign for Plain English back in 1979, had this to say about the language the financial sector uses; “It’s disgraceful that banks and insurance companies have such a hold over us through their use of language…. Often it means the customer is left with little clarity, and all the responsibility.”
Many people feel that effective communication and simpler language would play a vital role in rebuilding trust in the financial sector. Campaigners also feel that “improvements in readability could be made with relatively little effort”.
With trust in banks at such a low level following recent scandals, the financial sector would do well to simplify the language it uses in an attempt to engage the public with important issues in the economy.