Can financial services standardize putting clients first?

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The Fiduciary argument takes center stage.  Not long ago, I posted on the Obama Administration’s roadmap for financial regulatory reform.  Buried about two thirds of the way in to his plan are a few pages (specifically 72 and 73) that, as a financial planner, I believe speak to the heart of the entire issue. 
 
The proposed initiative:
 
“Establish a fiduciary duty for broker dealers offering investment advice and harmonize the regulation of investment advisors and broker dealers."
 
As a registered investment advisor, currently a fiduciary regulated under the Investment Advisers Act of 1940, I recognize the challenges of this initiative. 
 
 First, how do you define a true fiduciary? There is not one legally enforceable definition--its interpretation varies across courts of law, organizations that have adopted their own language, and will be further defined as specific matters arise in law and society. 

Second, under the law, responsibilities shift once the title of fiduciary is applied. For example, a trust department has different requirements and responsibilities to uphold than a traditional investment advisor who manages portfolios that contain trusts.  An investment advisor has different responsibilities when managing an ERISA Account (e.g., a 401k or other qualified retirement plan) than a regular account. The same holds for a doctor or a lawyer.
 
Conceptually and idealistically they all have the same thing in common--putting the client’s interests first. But legally, and from an enforcement perspective, they are vary dramatically. And there are a lot of challenges ahead in trying to implement some kind of uniform fiduciary standard across the entire world of financial services.
 
Fortunately, the Committee for the Fiduciary Standard recognizes this. And it is using its powerful media influence to put forth some specific proposals in regards to the fiduciary concept that can then be taken forward by lawmakers as they craft financial regulatory reform. 
 
The committee was formed a couple of months back to address some of the problems noted above. Its primary objective is to reach out to the consumer and financial media to educate about an authentic fiduciary standard. They must also intercept the powerful lobbyists of the Wall Street financial services firms and insurance companies who will likely try to weaken any fiduciary standard imposed by regulators (on their currently very profitable business models).
 
The committee has proposed the following five principles in an effort to simplify any regulation going forward when implementing a fiduciary standard:
 
-Put the client’s best interest first
 
-Act with prudence; that is, with the skill, care, diligence and good judgment of a professional
 
-Do not mislead clients; provide conspicuous, full and fair disclosure of all important facts
 
-Avoid conflicts of interest
 
-Fully disclose and fairly manage, in the client’s favor, unavoidable conflicts. 
 
Young professionals who are interested in supporting this endeavor can sign a petition.