The Consumer Duty Compromise: New Broadridge Research Finds Legacy Regulation is Undermining Customer Understanding

Rhea-AI Summary

Broadridge (NYSE: BR) research dated April 24, 2026 finds that legacy FCA disclosure rules can reduce customer comprehension and raise potential for harm. In a 1,500‑person UK trial, a reimagined communication more than doubled comprehension and personalised numerical examples raised understanding from 32% to 59%.

The report urges regulatory reform, application of behavioural frameworks, and stronger communications governance to improve customer outcomes, trust, and operational efficiency.

Positive

• Comprehension more than doubled with reimagined communications
• Personalised numerical examples raised understanding from 32% to 59%
• 1,500-participant randomised controlled trial provides experimental evidence
• Modernising communications can improve customer experience, trust, and lower operational costs

Negative

• Only 15% of participants answered key comprehension questions correctly using legacy communications
• Over 80% of participants perceived communications as clear despite low actual comprehension
• Senior communications leaders report legacy rules, rigid templates, and governance complexity as barriers

News Market Reaction – BR

-0.56%

-0.56% Session close to close

In the Apr 24 session, BR declined 0.56%, reflecting a mild negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement highlights Broadridge’s behavioural science research showing that redesigned, pers...

Analysis

This announcement highlights Broadridge’s behavioural science research showing that redesigned, personalised communications can more than double customer understanding, with key gains from 32% to 59% comprehension of inaction consequences. It comes as the stock trades well below its $217.37 200-day MA and 42.84% under its $271.91 52-week high. Investors may watch how such thought-leadership converts into mandates, and remain mindful of the effective S-3ASR shelf filed on 2025-08-05.

Key Figures

Trial participants: 1,500 customers Baseline comprehension: 15% Perceived clarity: Over 80% +2 more

5 metrics

Trial participants 1,500 customers Three-armed randomised controlled trial of UK savings customers

Baseline comprehension 15% Participants correctly answering key questions using original communication

Perceived clarity Over 80% Participants rating all versions as clear, fair and easy to understand

Understanding with examples 32% Understanding consequences of inaction before personalised numerical examples

Improved understanding 59% Understanding consequences of inaction with personalised numerical examples

Historical Context

5 past events · Latest: Apr 22 (Positive)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Apr 22	Product launch	Positive	-1.7%	Launch of Central Risk and Liquidity Optimization Solution for unified trading and risk.
Apr 21	Strategic investment	Positive	+0.4%	Minority investment in HQLAx to support growth on Canton Network.
Apr 21	Client win	Positive	+0.4%	Tavira selects Broadridge OMS, connectivity and middle office solutions.
Apr 20	Client adoption	Positive	+0.4%	Matsui Securities adopts JASDECPS SaaS to transform securities lending operations.
Apr 20	Earnings call scheduling	Neutral	+0.4%	Announcement of webcast and call to review Q3 FY26 results on Apr 30.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent product and partnership news has generally seen modestly positive or flat next-day moves, with one notable negative divergence.

Recent Company History

Over the past week, Broadridge has issued several operational and strategic updates. On Apr 20–22, 2026, it announced a new Central Risk and Liquidity Optimization Solution, a Tavira agency brokerage win, and Matsui Securities’ adoption of its JASDECPS SaaS platform. It also scheduled its Q3 FY26 results call for Apr 30 and disclosed a strategic investment in HQLAx. Price reactions were mostly small and positive, apart from a mild decline after the risk platform launch.

Key Terms

financial conduct authority, behavioural science, randomised controlled trial

3 terms

financial conduct authority regulatory

"legacy Financial Conduct Authority (FCA) disclosure rules may be actively undermining"

A government-authorized regulator that sets and enforces rules for banks, brokers, insurers and other financial firms to keep markets fair and safe. Think of it as a referee for the financial system: it watches for cheating, protects consumers, and can penalize companies that break the rules. Its actions matter to investors because enforcement decisions, rule changes or approvals influence company costs, reputations and overall market confidence.

behavioural science medical

"redesigned using behavioural science principles and personalised content, understanding"

Behavioural science studies how people actually make decisions, combining insights from psychology, sociology and economics to explain predictable biases, habits and emotional reactions. For investors, it matters because these human patterns influence consumer demand, employee behavior and market moves—like how a crowd can panic-sell or overbuy—so understanding them helps predict risks, shape marketing or product strategy, and design policies that nudge better financial outcomes.

randomised controlled trial medical

"In a three-armed randomised controlled trial of 1,500 UK savings customers"

A randomised controlled trial is a medical study in which participants are assigned by chance to different groups—one getting the treatment being tested and another a control such as a placebo or standard care—so researchers can fairly compare outcomes. Think of it like flipping a coin to form two teams to avoid bias. For investors, results from well-run trials provide the strongest evidence on a drug or device’s safety and effectiveness, lowering uncertainty about regulatory approval, market potential and commercial risk.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Comprehension more than doubles with reimagined communications, Broadridge's behavioural science study shows

LONDON, April 24, 2026 /PRNewswire/ -- New research from Broadridge Financial Solutions Inc. (NYSE: BR), a global Fintech leader, reveals that legacy Financial Conduct Authority (FCA) disclosure rules may be actively undermining customer understanding, and increasing the potential for customer harm.

The study, The Consumer Duty Compromise, finds that legacy regulation for financial communications can significantly reduce customer comprehension. However, when those same communications are redesigned using behavioural science principles and personalised content, understanding more than doubles.

"This research makes clear: legacy rules do present barriers to customer comprehension," said Emily Gore, VP Business Development & Strategy at Broadridge. "If customers don't truly understand the financial implications of their actions, or inaction, we risk falling short of Consumer Duty's core purpose. By applying behavioural science, firms can dramatically improve understanding and drive better customer outcomes. Firms that move early, the report suggests, will not only meet regulatory expectations, they will gain competitive advantage through stronger customer relationships."

Comprehension doubled, potential harm reduced

In a three-armed randomised controlled trial of 1,500 UK savings customers:

• Only 15% of participants who read the original (control) communication were able to correctly answer key comprehension questions.
• Despite this, over 80% of participants believed all versions were "clear, fair and easy to understand" - exposing a significant gap between perceived and actual comprehension.
• A fully reimagined version, designed to leverage key behavioural principles, more than doubled comprehension
• When personalised numerical examples were included, understanding of the consequences of inaction increased from 32% to 59% - the largest gain across the trial

The findings highlight a critical challenge for firms working to meet Consumer Duty requirements: customers consistently overestimate their understanding of financial communications.

A challenging context

Senior communications leaders across global and UK banks report feeling caught between compliance demands and delivering genuinely clear communications. Many cited prescriptive legacy rules, rigid templates, and governance complexity as barriers to meaningful progress, even where intent to improve is strong. The findings provide clear evidence of the real impact of legacy rules on the teams working to deliver key messages and on the customers themselves.  

Action on three fronts

The report recommends that firms:

• Continue to advocate for regulatory reform using evidence like this study
• Apply proven behavioural frameworks to maximise understanding within current rules
• Invest in a strategic approach to the governance and improvement of communications. One with the right roles, responsibilities and tools to manage consistent standards and track outcomes.

Beyond regulatory alignment, firms that modernise communications management can expect:

• Improved customer experience and trust
• Stronger brand metrics
• Faster speed to market
• Lower operational costs

A call for regulatory and industry action

The report suggests the following fixes:

• Continued FCA efforts to identify and remove conflicting legacy requirements
• Strategic approaches to the management and governance of customer communications to ensure consistent standards and support outcome tracking
• The establishment of specialist teams responsible for communications standards and equipping colleagues with the tools and support needed for clear, effective communications

About Broadridge

Broadridge Financial Solutions (NYSE: BR) is a global technology leader with trusted expertise and transformative technology, helping clients and the financial services industry operate, innovate, and grow. We power investing, governance, and communications for our clients – driving operational resiliency, elevating business performance, and transforming investor experiences.

Our technology and operations platforms process and generate over 7 billion communications annually and underpin the daily average trading of over $15 trillion in tokenized and traditional securities globally. A certified Great Place to Work^®, Broadridge is part of the S&P 500^® Index, employing over 15,000 associates in 21 countries.

For more information about us, please visit www.broadridge.com 

Broadridge Contacts:

Investors: 
broadridgeir@broadridge.com           

Media:
Gregg.Rosenberg@broadridge.com 

View original content to download multimedia:https://www.prnewswire.com/news-releases/the-consumer-duty-compromise-new-broadridge-research-finds-legacy-regulation-is-undermining-customer-understanding-302752401.html

SOURCE Broadridge Financial Solutions, Inc.

FAQ

What did Broadridge (BR) find about customer comprehension in the April 24, 2026 study?

Comprehension more than doubled with redesigned communications. According to the company, a reimagined version more than doubled correct responses in a 1,500‑person UK trial, showing behavioural design improves measurable understanding.

How did personalised examples affect understanding in Broadridge's BR research?

Personalised numerical examples increased understanding from 32% to 59%. According to the company, this was the largest gain in the trial and specifically improved comprehension of consequences of inaction.

What gap did Broadridge identify between perceived and actual clarity in communications?

Participants often overestimated comprehension: over 80% thought messages were clear while only 15% answered key questions correctly. According to the company, this reveals a major perception-versus-knowledge gap.

What recommendations did Broadridge (BR) make for firms to meet Consumer Duty?

Broadridge recommends advocating regulatory reform, applying behavioural frameworks, and investing in governance. According to the company, firms should adopt specialised teams and tools to track outcomes and raise standards.

Will implementing Broadridge's recommendations affect costs or speed to market for firms?

The report suggests benefits include lower operational costs and faster speed to market. According to the company, modernised communications management can streamline processes and reduce friction across teams.

How robust is the evidence behind Broadridge's Consumer Duty compromise findings?

The findings come from a three‑armed randomised controlled trial of 1,500 UK savings customers. According to the company, the experimental design and sample size provide direct evidence of communication design effects.