OCIO FUNDAMENTALS

Bringing together all you need to know, about outsourced CIO

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The basics

What is OCIO?

OCIO stands for Outsourced Chief Investment Officer. This is when an organization delegates either some or all of the day-to-day management of its investment portfolio to a qualified firm. By hiring an OCIO, you retain control over important decisions like strategic asset allocation. Your OCIO partner manages the day-to-day investment management.

How OCIO can help your organization

HOW CAN CIO OUTSOURCING HELP?

Deepen your resources.

Outsourcing your investments will add depth and continuity, allowing you to focus on the decisions most critical to your organization.

Respond more rapidly in a crisis.

Partnering with an OCIO firm ensures your portfolio is monitored around the clock and can respond rapidly in a crisis.

Lower your investment costs.

An OCIO provider can use their scale, leveraging in-house capabilities at cost and negotiating more competitive sub-manager rates.

OCIOs improve access to the best ideas

The right partner can significantly broaden the range of investment opportunities - robustly assessing, and providing access to, a much deeper pool of opportunities.

Improve alignment – The ESG Roadmap

Whether you're driven by personal or stakeholder values, mitigating risk or complying with regulation, ESG factors are a key consideration for many investors. Yet, as with many areas of investing, it's complicated. An investment outsourcing partner can help.

Private Markets - Leveraging its power

The private markets category can be a powerful investment tool for overcoming low returns. But it demands greater levels of risk management and potentially large capital requirements, challenges an outsourcing partner can help you address.

Enhanced implementation capabilities – Execution is key

A skilled outsourced investment management provider will be able to incorporate critical risk management functions, such as overlays and transition management internally, providing you with a single point of accountability

FIDUCIARY GUIDEBOOKS

Tailored for DB, DC, healthcare, and non-profit, we step through the key elements of an optimal investment program.

WE CAN HELP

If you're considering an outsourced CIO model, we can help you find the right approach for you.

No obligation. Let's talk.

OCIO MYTH-BUSTING

Top 3 concerns when transitioning to investment management outsourcing.

"I'll lose control of my investment program"

The reality is far removed. Each outsourcing partnership is based on the unique resourcing needs of the organization. Fiduciary responsibility cannot be delegated; however, we can help you determine the right level of resourcing for your organization. The ultimate authority remains with you.

"Outsourcing hides fee layering"

Fee standardization remains an elusive goal for the industry and hidden or additional fees can be an issue with some providers. The industry best practice remains full fee transparency, particularly around the remuneration to third parties, with a simple "all-in" or "cost-plus" fee based on the scale of assets managed.

"Strategies are over-diversified"

Portfolios can be over-diversified, with additional inclusions reducing return potential without reducing risk. Best practice providers will have the tools to accurately assess a broad array of opportunities for diversification and align them with the investors' unique risk appetite.

Considering an outsourced investment approach

What to look for in a provider.

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KEY ASPECT 1

Integrated, holistic risk management

Accurate, timely and comprehensive visibility of risks at the total portfolio level forms the foundation for virtually all basic risk and portfolio management activities. Yet, with the complexity embedded in today’s portfolios, across public and private assets, integrated holistic visibility is surprising uncommon.

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KEY ASPECT 2

Organizational focus and capability

Maintaining the full suite of capabilities required for any outsourcing solution requires significant commitment, scale and resources. Organizations with competing priorities, little leadership focus or lacking fully integrated capabilities will find it challenging to sustain a competitive edge.

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KEY ASPECT 3

Industry-specific experience

A partner lacking a well-grounded understanding of your industry will ultimately draw on your time to get up to speed (at your expense). In contrast, a partner who is an industry specialist will be able to provide additional insight, and support, based on their experience guiding organizations with similar challenges.

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KEY ASPECT 4

The human element

Although exceedingly difficult to quantify, the relationship between your organization and your outsourcing provider is of critical importance. The best partners will act as a seamless extension of your team, with aligned objectives and a cohesive approach.

OUTSOURCING GUIDE

Tools and practical advice to help determine the right investment outsourcing model for your organization.

RFP BUILDER

Our Request For Proposal Builder helps to ensure you ask the right questions when searching for the ideal partner.

LATEST OCIO BLOG POSTS

Hear from our experts on the latest on outsourced CIO.

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Our approach

Learn how we can help reduce your operational burden, so you are free to focus on what matters most.

What's next

We'd love to talk.

Lisa Schneider

Please reach out to me directly through this form.

Lisa Schneider, CFA

Managing Director,
Head of Client Solutions

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