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Legal counsel briefs Federated trustees on fiduciary duties, emphasizing loyalty and prudence
Summary
Board legal counsel delivered an annual fiduciary training covering the duties of loyalty, prudence, diversification, exclusive benefit and following plan documents; the session stressed process documentation, delegation and monitoring to reduce legal risk.
San Jose Federated Retirement System legal counsel provided trustees an annual refresher on fiduciary duties Jan. 16, focusing on the twin obligations of loyalty and prudence and practical steps to document deliberations and monitor delegated responsibilities.
Counsel Chen reviewed five core fiduciary duties that apply to public retirement boards in California: the duty of loyalty, the exclusive-benefit rule, the duty of prudence, the duty to diversify and the duty to follow the plan document. Counsel quoted Article XVI, Section 17 of the California Constitution as the constitutional basis trustees must follow and said those duties “take precedence” when the board administers the plan.
Chen…
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