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Make super documents more readable


The 2021 readability scorecard: Australian superannuation funds from Ethos CRS reports on the readability of documents produced by the largest super funds in Australia.

The findings are clear and stark. Super funds still have some work to do if they are to produce readable and engaging content for fund members.

In producing the scorecard, we were guided by two principles:

  • Fund members should be able to easily read what their funds put in writing.
  • Clarity helps members make informed financial decisions.

In Australia, superannuation is important. Over 12 million Australians have a super account, and over four million have more than one account. The sector manages $3.3 trillion in assets, yet only 35% of Australians know the value of their super.

Retail and industry super funds have a duty to be open and clear about the financial services they provide, the performance of funds they manage and the rights and responsibilities of fund members.

Using the online readability application VisibleThread, we measured three attributes of text: the Flesch-Kincaid grade level, active voice, and sentence length. These metrics then generate a readability score. A readability score of 100 reflects writing that is easy to read.

The average readability score of 80 documents from 20 funds was only 45.6. On average, content did not meet established benchmarks.

CareSuper won the gold medal for producing the most readable suite of documents. Their documents scored an average of 49.4.

We awarded silver medals to AustralianSuper and HESTA, which tied for second place. Their suite of documents each generated a readability score of 49.2.

To improve the readability and quality of documents, we made two key recommendations.

The first was that the sector should adopt the principles of plain language.

The second was that funds should set and meet standards for documents and content.

According to the Australian Bureau of Statistics, 44% of Australians read at or below a year 10 level. We found that the average score for grade level was 13.5, which suggests members may need tertiary qualifications to accurately interpret content and text.

The Association of Superannuation Funds Australia has identified that some members are more vulnerable than others. Some are less able to engage with content. Factors that make members vulnerable include low levels of literacy and/or a non-English speaking background.

The Australian Treasury has also emphasised that super funds should communicate clearly. Simple changes can improve engagement, savings and choices.

Is it easy to express complex financial ideas clearly? Or to engage with a very diverse group of members? The answer clearly is no.

Funds have told us that they are adopting a conservative approach when producing mandated documents - product disclosure statements, financial services guides, annual reports, and company policies.

Legal departments are having the final word on documents and text. Which is good ... and bad.

The pressing of legal professionals into a communications role is a potential consequence of interest from regulators. In the wake of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, regulators are understandably keen for funds to meet mandated requirements for content.

To ensure that content complies, funds face a challenge and create a tension. Documents must comply with the law and yet must still be easily understood by members.

And this is where readability comes in.

Whatever the audience and whatever the benchmark, readability as a measure enables funds to assess the adequacy of content.

That's an important first step if content is to become clear.

The readability metrics for this article are:

  • Ethos CRS readability score: 140.8
  • average words per sentence: 13.8
  • active voice sentences: 98 per cent
  • grade level: 11.