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Financial Markets Conduct Act 2013

Governance of financial products - Governance of managed investment products - Role of manager

144: Duty of manager and investment manager to comply with relevant professional standard of care

You could also call this:

"Managers must be careful and make good decisions when looking after people's money."

Illustration for Financial Markets Conduct Act 2013

When you are a manager of a registered scheme, you must be careful and diligent in your work. You need to exercise the care, diligence, and skill that a prudent person in your profession would use in the same situation. This means you must work carefully and make good decisions.

If you are a trustee of a restricted scheme and you are not a professional manager, you still have to be careful. You must exercise the care, diligence, and skill that a prudent business person would use in the same situation. This helps keep the scheme running smoothly.

You can find more information about this by looking at the Financial Markets Conduct Act 2013 and other related laws, such as the laws referenced in the compare section, s 24(1), s 117, and cl 3(3).

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM4091136.

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143: General duties applying in exercise of manager's functions, or

"Managers of schemes must act honestly, fairly, and in the best interests of scheme participants."

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145: Duties of directors and senior managers of manager, or

"People in charge of companies must be fair and not use their job to help themselves or hurt others."

Part 4Governance of financial products
Governance of managed investment products: Role of manager

144Duty of manager and investment manager to comply with relevant professional standard of care

  1. A professional manager of a registered scheme must, in exercising any powers, or performing any duties, exercise the care, diligence, and skill that a prudent person engaged in that profession would exercise in the same circumstances.

  2. In this section, a professional manager is—

  3. a manager of a registered scheme (other than a restricted scheme):
    1. an investment manager of a registered scheme:
      1. a licensed independent trustee of a restricted scheme:
        1. any other trustee of a restricted scheme whose profession or business is or includes acting as a trustee or investing money on behalf of others.

          1. A trustee of a restricted scheme who is not a professional manager must, in exercising any powers or performing any duties, exercise the care, diligence, and skill that a prudent person of business would exercise in the same circumstances.

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