Duty of care
The obligation to exercise the skill, prudence and diligence that a reasonable professional would exercise in the same circumstances — measured against a standard of conduct, not against the outcome.
Why it matters
Owed to the client or beneficiary, by the person who undertook the responsibility. It bites at the moment a decision is made, and is assessed with reference to what was reasonable then rather than what is known now — which is why contemporaneous records matter more than retrospective explanations. It is breached by failing to do what a prudent professional would have done: not by losing money, and not by using an automated system. The open question in agentic finance is what constitutes reasonable care in deploying a system whose behavior the deployer cannot fully predict, and no court has answered it. Deploying without an articulated governance framework, in a period when frameworks are publicly available, is the fact pattern most likely to be tested first.
What it is not
These are routinely confused with Duty of care. The distinctions are not pedantic — each one has consequences for how a system is governed.
Care concerns competence and diligence. Loyalty concerns whose interest is served. Both are components of fiduciary duty and are breached differently.
Best execution is a specific obligation about trade handling. Duty of care is general and covers the whole relationship.
Relationships
Typed edges into the rest of the ontology. These are what make the canon traversable rather than merely readable.
| Verb | Target | Meaning |
|---|---|---|
relatedTo | Fiduciary duty | An association too weak or too general for a stronger verb. |
addresses | Accountability | The subject speaks to the object as a question or concern. |
relatedTo | Oversight | An association too weak or too general for a stronger verb. |
Record
| Canonical identifier | QIS-TERM-00055 |
| Status | Canonical industry term |
| Adoption | Widely used |
| Domain · Layer | Legal doctrine · Governance |
| Origin | Tort and fiduciary law; one of the two components of the adviser's fiduciary obligation. |
| Semantic aliases | None recorded. |
| First published | 2026-08-02 |
| Last reviewed | 2026-08-02 · 180-day cycle |
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