REP 632 Disclosure: Why it shouldn鈥檛 be the default
Released听14 October听2019
Financial services disclosure has traditionally been assumed to inform us (as consumers), help us make 鈥榞ood鈥� financial decisions, and drive competition.
This report focuses on the real-world context in which disclosure operates. It shows that, and explains why, disclosure and warnings can be less effective than expected, or even ineffective, in influencing consumer behaviour. In some instances it shows that disclosure and warnings can backfire, contributing to consumer harm.
The report is a joint publication by the 91AV and Investments Commission (ASIC) and the Dutch Authority for Financial Markets (AFM). Both of these regulators have, over a number of years, identified limitations to disclosure in their respective retail financial services markets.听 Although the Australian and the Dutch financial markets and regulatory regimes differ, there is also much common ground.