Fiduciary

A fiduciary is an individual or organization that is legally and ethically obligated to act in the best interests of another party. Commonly found in financial advising, estate planning, and corporate governance, fiduciaries are bound by duties of loyalty and care, ensuring that they prioritize their clients’ needs above their own. Fiduciaries must provide honest and transparent advice, avoiding conflicts of interest and always acting with their clients' best financial interests at heart.

Example

A financial adviser managing a retiree’s investment portfolio acts as a fiduciary, making investment decisions that align with the client’s goals, risk tolerance, and long-term needs. Even if a higher commission could be earned by recommending another product, the adviser must choose the option that best serves the client's interests.