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Reconfiguring the Future-Fit Fiduciary Using Collective Phronesis and Techné

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  • Helen Mussell

Abstract

This paper argues that a reconfiguration of the practice of the fiduciary – widely cited as a barrier to pursuing sustainability investments and initiatives - presents the opportunity for a promising connection between practical wisdom and business ethics practice. The paper introduces three tensions arising from current fiduciary practice which constrain sustainability. A proposed reconfiguration of fiduciary practice to resolve the tensions is then outlined. This reconfiguration pivots on two premises. Firstly, that fiduciary practice should be disaggregated into two ontologically distinct stages – processual and outcome – and secondly, that different types of wisdom and knowledge are required for each stage – namely collective phronesis for the first processual stage and techné for the second outcome stage. This differentiation creates new divisions of labour for trustees and beneficiaries, with the first stage facilitating joint consultation. The extent this inclusive future-fit fiduciary has for positively impacting sustainability and ethical business practice is highlighted.

Suggested Citation

  • Helen Mussell, 2026. "Reconfiguring the Future-Fit Fiduciary Using Collective Phronesis and Techné," Working Papers wp549, Centre for Business Research, University of Cambridge.
    • Handle: RePEc:cbr:cbrwps:wp549
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    References listed on IDEAS

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    1. Goodman, Jennifer & Arenas, Daniel, 2015. "Engaging Ethically: A Discourse Ethics Perspective on Social Shareholder Engagement," Business Ethics Quarterly, Cambridge University Press, vol. 25(2), pages 163-189, April.
    2. Benjamin J. Richardson, 2011. "From fiduciary duties to fiduciary relationships for socially responsible investing: responding to the will of beneficiaries," Journal of Sustainable Finance & Investment, Taylor & Francis Journals, vol. 1(1), pages 5-19, February.
    3. Haug, Espen Gaarder & Taleb, Nassim Nicholas, 2011. "Option traders use (very) sophisticated heuristics, never the Black-Scholes-Merton formula," Journal of Economic Behavior & Organization, Elsevier, vol. 77(2), pages 97-106, February.
    4. Mussell, Helen, 2021. "The Silenced and Unsought Beneficiary: Investigating Epistemic Injustice in the Fiduciary," Business Ethics Quarterly, Cambridge University Press, vol. 31(4), pages 549-571, October.
    5. Helen J. Mussell, 2023. "Theorising the Fiduciary: Ontology and Ethics," Journal of Business Ethics, Springer, vol. 186(2), pages 293-307, August.
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    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law
    • N2 - Economic History - - Financial Markets and Institutions

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