In an industry where Greed is Good, Fiduciary Responsibility seems almost counterintuitive, sort of akin to requiring selflessness in an industry that rewards selfishness. Yet, Fiduciary Responsibility is the law of the land.
Therefore, establishing a strategy for maintaining, reconciling, or if necessary, rehabilitating your personal understanding and application of Fiduciary Responsibility is an important component of the Wall Street Psychologist’s Gyroscope.
This is easier said than done, because Fiduciary Responsibility governs the relationship between two individuals (or an individual and an institution) within the pressurized context of a financial affiliation susceptible to so many factors.
For instance, the fiduciary must be able to take criticism, which may sometimes be irrational, harsh, and even abusive. The fiduciary must listen and process their client’s fears, anxieties, and grievances. Acknowledging the client’s dignity, worth, and value is paramount at all times and one should never take their client for granted. Never minimize client concerns. The very act of listening to a client’s grievances strengthens the relationship. In fact, it is required and as such is part of the psychological mechanism that cements the partnership and makes it more real and human. After all, you are managing one of the client’s most precious possessions: their money!
In treatment, as explained further in this book, I focus on reacquainting my patients with concepts such as virtue, integrity, and honesty. Reconnecting with these concepts is necessary to restoring appreciation for the necessity of Fiduciary Responsibility.
Fiduciary Responsibility is that much more difficult to navigate because there is no central document to apply. While the Securities & Exchange Commission and other regulators incorporate concepts of Fiduciary Responsibility into various rules and regulations, there is no definitive, industry-wide statute.
So, while there is general consensus on the core theme of Fiduciary Responsibility, in how it is specifically applied by individuals and the institutions for which the work can vary greatly.
In lieu of some form of standardized industry-wide rehabilitation initiative, I have developed a simple “Fiduciary Responsibility Affirmation Exercise,” detailed further in this book.[4]
[4] See section 3.1.1 – Fiduciary Responsibility Affirmation Exercise