The Plain English Handbook is a reflection of individuals’ and organizations’ ideas, and generosity of many including the SEC and the private sector. For Investors to benefit fully from the protections of our federal securities laws, they must read and understand disclosure documents. Owing to the fact that many investors are neither lawyers, accountants, nor investments bankers can understand plain English.
There must be an acquisition of new style in terms of thinking and writing for the shift to plain English to be a success. We must question whether the documents we write highlight the essential information that investors require in order to make informed and viable decisions. Adoption of a precise way of communicating the jargon and legalese of the past is mandatory in the area of investment. This way of communication should be in a position to communicate complex investment words in a clear way to investors. There are many benefits for using plain English. First investors will gain the ability to make informed decisions in terms of what to buy, when to sell and when to hold. By reading and understanding plain English documents, brokers and advisers on investment issues will be able to make informed and better recommendations to their clients. The production of documents that fulfill the needs of our security laws is the aim of plain English regardless of which route one takes. This aims at telling clearly to investors, what they need to know in order to make informed investment decisions. Plain English does not mean erasing complex information in order to make the document easy for investors to understand. In the contrary, plain English means presentation of complex information in a clear and orderly manner in order for investors to understand and make informed decisions. Plain English entails analysis and decision on the kind of details that an investor requires for him or her to make a sound decision in terms of investment. There is extremely economical use of words in the plain English documents. This is dictated by the level of understanding of the audience. The sentence structure within the document is tight, and the tone is direct and welcoming. The design of the document should be visually appealing to the reader. The document prepared in plain English should be easy for the investor to read and should look like a document meant for reading.
There are some guidelines for text in plain English. First, one should avoid obvious grammatical mistakes like too wordy sentences, verbs that are weak and not supportive, ensure one uses active voice, complicated financial and legal jargon, the layout should be readable and understandable and avoid unnecessary details. Secondly, they should maintain readability and highlight information use different size or weight of their typeface. An extremely crucial aspect of writing a plain English document is the generous utilization of white space in the pages. This enhances readability, helps in emphasizing the significant points and lightens the overall look of the document. There are steps involved in the preparation of the plain English document. First, one has to assemble a team. The team will include a team leader who will see the project through to its conclusion. The team should have lead writer who will format the document into a simple, readable and understandable work. There should be lawyers who will advice on the kind of information that needs to be included in the document and the reasons for the same. There should be an investment expert, a compliance officer, an operations person and a marketing person.
One should then select the documents. This includes consideration of the length of the document and the time required for writing the document. With this, one is armed with the knowledge necessary in the preparation of plain English documents for the purpose of investment and prospectus information.