For social security institutions that have an investment mandate, legislation, policy or decree establishes the general direction of the investment policy, adherence to the prudent person principle, and aligns it with sustainability principles. The board and the management have the technical expertise to decide on the types of allowed investment instruments, the need for diversification to mitigate risks, and the merits and risks of an investment proposal, using security and profitability as the main basis for an investment undertaking. Legislation, policy or decree establishes the legal liability of the board, the management and their designated agents for fraudulent investments.