August 9, 2015
It is my understanding the Securities and Exchange Commission (SEC) has issued proposed rules that will shift the default delivery method for critical shareholder reports from paper to electronic delivery. While I can appreciate the intent of this change, it is too early in the evolution of digital technology for the consumer. Currently, the consumer is given the choice of how to receive investment reports. According to SEC's own study conducted by Siegel + Gale in 2012, 71 percent of American investors said they prefer to read annual reports in paper format rather than online versions and a large number of respondents also asserted that printed materials yield higher content comprehension than online materials.
Rule 30e-3 would impede access for many investors, especially the elderly, those with disabilities, and minority Americans - all demographics that are less likely to have regular Internet access. For example, 41 percent of Americans over 65 years of age do not use the Internet, yet, according to the Investment Company Fact Book, 34 percent of this population owns mutual funds.
Paper is a superior distribution method for important information. In a recent national survey, 88 percent of respondents said that they understand and can retain or use information better when they read print on paper, and when given a choice, 81 percent of respondents prefer to read print on paper.
Please do not change the current distribution of reports via paper. By making investment information only available online, it becomes "out-of-sight, out-of-mind" and no longer user-friendly. Having to now navigate various websites, make specific requests, and possibly pay for printing are not options that promote ease of use and transparency. I hope you will reconsider the changes in your proposed rules.
Robert J. Woods | Executive Director
United Way of York County