August 3, 2015
The U.S. Government, thru the Security Exchange Commission (SEC), is attempting to take away paper options and shift the burden to the consumer. The "Investment Company Reporting Modernization Rule 30e-3", the proposal will make electronic delivery the new standard for all shareholder reports. To continue receiving information in print, the consumer will need to log into a website, make a request, and possibly pay for print.
This is opposite from how the industry operates today. When you invest in company stock, a mutual fund or an IRA, you currently receive printed materials in the mail for free. You have an option to receive information through e-mail, but the Choice is yours and it is free.
Paper is still the preferred method of transmission for investors. 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.1
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.2, 3
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.
Peggy A. Thiel
Controller
PA Operations
Glatfelter