Holding Superfiduciaries Accountable to the Adaptively Evolving Extraordinary Prudence Of People Who Care

The essence of good stewardship is fiduciary accountability to the common sense and common wisdom of The Hypothetical Reasonable Person.

The right and responsibility for making investment choices sits squarely with the superfiduciary, but those choices must be prudently made to pursue the twin superfiduciary purposes of generating adequate superfiduciary cash flows, forever, in a forever that is worth flowing into.

Success is not legally required. Prudence is.

Prospects for success are determined by the superfiduciary.

Prudence in assessing those prospects is determined by The Hypothetical Reasonable Person.

The Hypothetical Reasonable Person is the embodiment of the common sense and common wisdom of you, me and all of us, as People Who Care, whose lives are affected by the decisions being made by the superfiduciary stewards of society’s shared savings.

How do we give The Hypothetical Reasonable Person its shape? And how do we change that shape from time to time, to fit the changing times, as times change, and people evolve prosperous adaptations to life’s constant changes?

In the context of Modern Finance, where superfiduciary investing is pretty much limited to hiring professional portfolio managers to manage portfolios of trading positions in shares of specified kinds of investment contracts (commonly called “financial assets”, or just “assets”) listed for trading over specified public exchanges (or in alternative private trading markets), there is not a lot of need or opportunity to consult The Hypothetical Reasonable Person.

Once you commit to speculation through portfolio diversification, there is not much that common sense or common wisdom can say beyond requiring adherence to industry norms by hiring good managers who are properly expert and experienced in the kinds of investment contracts they speculate on, and the public exchanges or private alternative markets they speculate in.

In the context of evergreen~ Future Finance, where superfiduciary investing is through negotiated agreements on prioritizing cash flows flowing though enterprise, there is constant need for guidance on the evolving standards of prudence from The Hypothetical Reasonable Person.

Success is still not legally required, but it does become a primary indicator of whether particular kinds of investments meet the standards of extraordinary prudence. And by this standard, the entire Modern Finance practice of speculation through portfolio diversification is just not prudent, because it just is not working.

Once we replace peer benchmarking with superfiduciary success, there is a lot that common sense and common wisdom can, should and must say about which Main Street enterprises superfiduciaries choose to invest in, and how well those investments are designed to contribute to the twin superfiduciary purposes of generating adequate superfiduciary cash flows, forever, in a forever that is worth flowing into.

Which means we have to evolve new places and processes for popular participation in adaptively evolving the common sense and common wisdom of The Hypothetical Reasonable Person.

is accountable for both financial results,
and physical impacts

The Importance of Conversation

People talking.

That’s how common sense and common wisdom get shaped, and how they evolve over time, and from time to time. People talk about their experiences, and form consensus views about what it is reasonable to expect will be the consequences if certain people take certain actions at certain times, under certain circumstances.

Most of the time, common sense and common wisdom evolve informally.

Now is not one of those times.

When the question is whether certain superfiduciaries investments are properly prudent, it seems prudent to have a more formal process for getting people talking. And it seems further prudent to include experts in that process, to facilitate discussion towards consensus, and also to provide technical guidance on any technical matters that may become important to reaching the right consensus.

The process must be sufficiently open and inclusive to be properly representative of the common sense and the common wisdom of all, but also sufficiently ordered and disciplined to avoid collapsing into a chaos of contentiousness. After all, the point of the conversation is not to make a particular investment decision. The decision whether or not to invest is exclusively the right and responsibility of the superfiduciaries. The purpose of the conversation is only to provide guidance to the superfiduciaries on whether or not the community at large will consider an investment properly prudent if it gets made, even if, in the event, it does not work out as expected.

This is why we talk about popular participation in curated conversations, where experts control the flow, to keep the discussion properly focused on the limited question of prudence.

A new role for the university

A good place to hold open conversations that are curated by experts can be found in the modern university, especially universities that are physically located within urban clusters of bioregional uniqueness. These universities have the physical facilities, public accessibility and knowledge experts required for popular participation in curated conversations. Moreover, they have access to the technologies of social media through which to expand the reach of popular participation, to ensure that conversations really do reflect the common sense and common wisdom of all the people.

A new use for the Humanities

Participation in curated conversations requires at least a minimum level of technical fluency and linguistic proficiency with the core competencies of evergreen~ enterprise design through superfiduciary stewardship investment decision-making. It also requires a sufficient sense of history and at least some minimum level of cultural literacy, and some familiarity with geography, governance, anthropology, sociology, language and linguistics.

People Who Care who study the Humanities, either formally, at university, or autodidactically, will be better prepared to participate in curated conversations about the common sense and common wisdom of extraordinary prudence.

A new pursuit of Peace

All people want peace. Modern Finance is not designed to finance peace. Future Finance will be.

A major focus of conversations with People Who Care about extraordinary prudence will focus on whether a contemplated investment will foster and promote peace, both earth peace and people peace.

A new function for Art