fiduciary duty

Intermediatezipf 3.04

Pronunciation

/fɪˈdjuːʃiˌɛri ˈdjuːti/(fih-DOO-shee-er-ee DOO-tee)

Part of speech

nounlaw / finance

Chinese

信托义务；受托责任

Definition

A legal obligation to act in the best interest of another party — the highest standard of care in law, requiring loyalty, good faith, and avoidance of conflicts of interest.

Word family

  • fiduciary/fɪˈdjuːʃiˌɛri/(adj/n)信托的/受托人

Collocations

  • breach of fiduciary duty
  • owe a fiduciary duty
  • fiduciary duty of care
  • fiduciary duty of loyalty
  • fiduciary obligations

Examples

  1. 1.A company director owes a fiduciary duty to shareholders — they must prioritise the company's interests above their own, even if a personal opportunity is more lucrative. (corporate governance)
  2. 2.The financial adviser breached his fiduciary duty by recommending high-commission products that benefited him rather than his clients. (professional obligation)

Synonyms

  • duty of care (obligation to act responsibly)
  • duty of loyalty (obligation to put another's interests first)

Etymology

from Latin "fiduciarius" — from "fiducia" (trust, confidence) — the duty that flows from trust