Fiduciary duty

How it is used

A formal term found in board papers, law and finance. Directors, trustees and fund managers owe a fiduciary duty, often described as a duty of care and a duty of loyalty. The exact rules depend on each country's law.

Example sentences

1. The company lawyer reminded the directors of their fiduciary duty before the vote.

2. Using company information for personal gain would be a breach of fiduciary duty.

Common collocations

• owe a fiduciary duty
• breach of fiduciary duty
• fiduciary duty to shareholders
• fiduciary responsibility

Related terms

• board of directorsThe group of people elected by a company's shareholders to oversee its management, approve major decisions and appoint or replace the chief executive.
• conflict of interestA situation in which a person's private interests, such as money, family or another job, could affect, or seem to affect, the decisions they make for their organisation.
• shareholderA person or organisation that owns shares in a company, and therefore part of it, usually with the right to vote at general meetings and to receive dividends.
• corporate governanceThe system of rules, practices and controls by which a company is directed and supervised, especially the relationship between the board, the managers and the shareholders.
• non-executive directorA board member who is not part of the management team and does not work in the business day to day, but advises and monitors the executives.

This word in other fields

The same English word can have a different meaning in another field:

• fiduciary duty · Contract & Commercial Law

More terms: Corporate Governance

• stakeholder
• transparency
• compliance
• code of conduct
• succession planning
• ESG