Which of the following best describes a fiduciary duty?

A fiduciary duty is primarily characterized by the responsibility to act honestly and in good faith on behalf of another party. This duty requires fiduciaries, such as trustees or financial advisors, to prioritize the interests of their clients or beneficiaries over their own interests. It encompasses a range of ethical obligations, including loyalty, prudence, and full disclosure, ensuring that fiduciaries act in a way that fosters trust and confidence within the client relationship. By adhering to these principles, fiduciaries help safeguard the interests of those they serve, ensuring that their actions are not only legal but also morally sound.

This understanding highlights why the other options do not adequately define fiduciary duty. While the pursuit of profits for a firm may be a goal for some business roles, it does not encompass the broader ethical obligations inherent in fiduciary relationships. Unilateral decision-making power does not align with the collaborative and trust-based nature of fiduciary responsibilities. Finally, managing assets without supervision implies a lack of accountability, which contradicts the key tenets of fiduciary duty that emphasize oversight and care in managing another party's assets.