As a coach, you have both a fiduciary obligation and a duty of care to your clients, and those whom you come into contact with in the course of your work. These are very important legal concepts that you may not have come across before. To the best of the writer’s knowledge, they apply in the same or similar way throughout the world.
The term ‘fiduciary’ (from the Latin trust and good faith), is a duty imposed by the law of equity (a branch of law relating to fairness), that relates to people who engage in a formal contract with others in roles such as advisors, attorneys/solicitors, coaches, consultants, partners, stockbrokers, etc. (In the graphic above, the fiduciary obligation is represented by the smaller circle, because it only applies to people with whom you have engaged in a contract.)
It is designed to ensure that the client (who is usually paying for the service, although the client relationship also exists in unpaid situations), is able to rely on the advice, guidance and information given by the service provider (in this case the coach).
This reliance covers a wide range of issues, including the following rights of the client, which in turn form the obligations of the coach:
- to be able to rely on the coach acting entirely in the client’s best interests (to the extent that this may mean putting the client’s best interests ahead of the coach’s);
- to be treated entirely fairly;
- to maintain the relationship in strictest confidence;
- to have the coach disclose any conflict of interest that may arise during the relationship;
- to have the coach disclose any situation where the coach may not be able to fulfil their role effectively for any reason;
- not to have the coach take advantage of the client’s lack of knowledge or vulnerability to benefit the coach in any way.
Whatever you do in your client/coach relationship must be focused on the benefit for the client. In the unusual situation where a conflict of interest between the client’s needs and your own needs arises, you must always put the client first.
While the fiduciary obligation is restricted to people who are in a contract of some sort, the slightly lesser duty of care applies to everyone with whom a professional or business person comes into contact in the course of their work, including people to whom you owe a fiduciary obligation. (Duty of care is part of the branch of law known as the tort of negligence, and is also part of common law [that decided by courts].) It is expressed as a moral duty to take reasonable care not to cause or permit ‘harm’ to any other person.
In the coaching environment, we have a duty of care to prospective future clients as well as current and past clients. We also have a duty to our colleague coaches, other professionals and people associated with clients, such as family members, employers, media, and the public at large.
Any assessment of whether a duty of care has been breached will usually take account of three specific factors:
- In the United Kingdom, Australia and New Zealand (along with, I believe, many other developed countries), the basic test is the ‘reasonable person’ test. Would a reasonable person have acted in such a way, without first checking facts, or seeking further advice or information?
- What level of harm or damage has resulted from such action? (The higher the level of actual or potential harm that may arise, the greater the duty of care obligation.)
- Were there any policy considerations or restrictions that should have alerted a person to a direction not to rely (partly or exclusively) on advice or information provided? (E.g. a disclaimer, warning, etc.)
Although these terms can at first seem quite confusing, they’re not actually hard to manage on a day to day basis. Remember, if someone is your client, you have a higher level of obligation to them. You must place their interests ahead of your own. The duty of care is about not exposing people to risk. Avoid this by using plain-language disclaimers or caveats, (both verbal and written, if necessary).
This is a guest post by Certified Positive Psychology Coach® member, Yvonne Box.
If you would like to learn more about coaching issues like these, register for the upcoming Best Practices for Professional Coaches module. Click the big blue button to find this and other coaching training modules.