Investment Governance Blog

RiskApocalypse

UPIA §2(b) – Duty to Monitor Risk and Return

The Duty The preamble to the Uniform Prudent Investor Act notes, “The tradeoff in all investing between risk and return is identified as the fiduciary's central consideration.”  For most trustees...
RiskApocalypse

ERISA §1104(a)(1)(c): Duty to balance risk and return with Alternative Investments

Prudence not Prescience Trustees are required to make hard investment decisions. They are to take into consideration the risk of loss and the opportunity for gain associated with each particular...
Advice

Prudent Delegation Standard of Care: Registered Investment Advisor v. Registered Representative

In the same way a trustee owes duties of care and loyalty to the beneficiaries of a trust, the investment managers also owe a particular standard of care to the...
Diversification

ERISA §1104(a)(1)(C) re Diversification

US Code §1104(a)(1)(C) states, “A fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries… by diversifying the investments of the...
Pirate

UPIA §7 re Duty to Pay Only Fair Fees

“Wasting beneficiaries' money is imprudent. In devising and implementing strategies for the investment and management of trust assets, trustees are obligated to minimize costs” (National Conference of Commissioners on Uniform...
business manager's duties of care

Johnny Depp v. TMG: What are a business manager’s duties of care?

The Question: What standard of care and what attendant duties does a business manager owe to their client? The Answer: It depends on what roles and services the business manager...
Diversification

Reconciling the Duty to Diversify

The Duty “In making and implementing investment decisions, the trustee has a duty to diversify the investments of the trust unless, under the circumstances, it is prudent not to do...
Pirate

ERISA §1104(a)(1)(A)(ii) re Duty to Incur Reasonable Fees

It is fundamental to a trustee’s duties to ensure that expenses incurred by the plan are fair and reasonable. However, when a plan is using one vendor to provide a...
Funds Greatest Risk

An ERISA Trustee’s Duty of Loyalty

It’s hard to be an ERISA trustee. Many plan trustees have other pressing corporate responsibilities and few have the time or experience to become fiduciary governance experts. But fiduciary governance...