In general, a fiduciary duty means that someone has to consider the best interests of another individual or potentially a business entity when making decisions. If they have a fiduciary duty, they cannot simply act in their own best interests at all times, especially if it would harm that other individual or business.
In this sense, your business partner certainly has a fiduciary duty to you and the company. They are expected to act in good faith and make reasonable decisions that put the company first. They will not take deliberate action to harm the company, and they will work hard to avoid negligent action that could result in the same outcome.
Does this mean mistakes are not allowed?
No, this does not necessarily mean mistakes are prohibited. If your business partner makes a poor decision and it harms your company financially, they may have made it in good faith, genuinely believing that it would help the business. They have not breached their duty to your company.
However, if your business partner is embezzling funds or misappropriating business assets for personal use, that would be a violation of their fiduciary duty. They are causing financial harm to the company for their own gain.
Another example could be if your business partner owns another company in the same industry that you are not connected to. If they take steps to help that other business at the expense of your partnership, you may be able to claim that it is a breach of their fiduciary duty. This does not mean they cannot be involved with two businesses at once, but they have to be careful about what they do to avoid deliberately causing harm to you or the partnership that you joined.
If you believe that your business partner has violated this duty and caused serious harm, it can lead to conflicts and lawsuits. Take the time to carefully look into all of your legal options to find a resolution.