What is "breach of fiduciary duty"?

Breach of fiduciary duty occurs when an individual or entity fails to act in the best interests of another party to whom they owe a fiduciary obligation. This duty is commonly found in relationships like those between a trustee and a beneficiary, or a corporate officer and the corporation's shareholders. The essence of a fiduciary duty is trust and confidence; one party is entrusted to manage the affairs or assets of another party, and they must prioritize the interests of the latter above their own.

When this duty is breached, it can result in significant legal repercussions, as the breach undermines the trust that is fundamental to these relationships. This concept is critical in the context of corporate governance, where officers and directors are expected to act in the best interests of the shareholders.

The other choices touch on aspects of business ethics and wrongdoing but do not encapsulate the specific legal definition and implications of a breach of fiduciary duty. A minor violation of policies doesn't reach the level of obligation required in fiduciary relationships, ethical dilemmas can involve various interests but do not specifically define the legal breach, and financial wrongdoing might occur within the context of a breach but does not capture the essence of the fiduciary obligation itself.