Question

Why is it important to include fiduciary activities in an institution's overall strategic plan? Select all that apply.

a. To develop a strategic plan, an organization's strengths and weaknesses can be evaluated.
b. Failure to do so may result in misallocation of resources to the fiduciary business line.
c. Board and management may be better positioned to recognize and react to changes in the environment and to risk facing fiduciary business lines.
d. Effective planning should include information and input for plans for each individual business line, including an organization's fiduciary business lines.

Answer 1

Including fiduciary activities in an institution's overall strategic plan is important for evaluating strengths and weaknesses, preventing resource misallocation, recognizing and reacting to changes and risks, and ensuring coordination and alignment across business lines.

Step-by-step explanation:

Including fiduciary activities in an institution's overall strategic plan is important for several reasons:

1. To develop a strategic plan, an organization's strengths and weaknesses can be evaluated. By including fiduciary activities, the organization can assess its financial strengths and weaknesses, and make informed decisions about resource allocation.
2. Failure to include fiduciary activities may result in misallocation of resources to the fiduciary business line. Without proper consideration of fiduciary activities, the organization may allocate resources in a way that does not align with its overall strategic objectives, leading to inefficiencies and potential financial losses.
3. The board and management may be better positioned to recognize and react to changes in the environment and to risk-facing fiduciary business lines. By including fiduciary activities in the strategic plan, the board and management can stay informed about market trends, regulatory changes, and other factors that may impact the fiduciary business lines. This allows them to proactively adapt their strategies and mitigate risks.
4. Effective planning should include information and input for plans for each individual business line, including an organization's fiduciary business lines. By including fiduciary activities in the overall strategic plan, the organization ensures that each business line, including fiduciary business lines, is considered in the planning process. This promotes coordination and alignment across different areas of the organization.