Author: Knut A. Rostad
SEC Chair Mary Jo White’s recent statement that the SEC should proceed with rule-making on a uniform fiduciary standard focuses attention on what such a rule may entail. Recent SEC decisions, statements from senior staff and commissioners and statements from former SEC staff and commissioners provide bold lines of a clear picture of the SEC’s view of the duty of loyalty.
These bold lines suggest traditional views that conflicts of interest are inherently harmful and should be avoided have altered. Instead, they depict a new and benign view of conflicts. A view that holds that conflicts are routine and acceptable — not inherently inconsistent with providing objective advice.