Which of the following defines "fiduciary duty"?

The definition of "fiduciary duty" is best captured by the obligation to act for another's benefit within the scope of a relationship. This concept emphasizes the trust and confidence inherent in the relationship between the fiduciary and the beneficiary, where the fiduciary is required to act with loyalty and care.

Fiduciary duty is central to many professional roles, particularly in finance and legal contexts, where an individual is entrusted with the care of another's assets or interests. This duty mandates that the fiduciary must prioritize the best interests of the beneficiary while exercising their authority and making decisions. It embodies principles of honesty, transparency, and ethical conduct, requiring the fiduciary to avoid conflicts of interest and to not benefit personally at the expense of the beneficiary.

In contrast, the other choices reflect aspects that might relate to fiduciary roles but do not capture the essence of fiduciary duty itself. Authority to make decisions or manage investments does not inherently imply the ethical obligations necessary to meet fiduciary duty. Additionally, the notion of allocating funds without restrictions may suggest a level of authority but lacks the nuance of accountability that fiduciary duty entails. Thus, the obligation to act for another's benefit is the most accurate characterization of what constitutes fiduciary duty.