The executive chairman and founder of one of the earliest OCIO firms urges investors to be cautious about new firms claiming to offer the same service.

Alpha Capital Management has unveiled a new set of indices to help asset owners measure the performance of outsourced chief investment officers, or OCIOs.

In this new volume, Nicole Wellmann Kraus advances our understanding of effective strategic oversight of endowments to strengthen the prospects for investment success and organizational financial health, as she sheds light on the demands of a sector in disruption.

Some OCIO search consultants are worried about managers loading up OCIO portfolios with their own investment strategies, with some declining to recommend OCIOs that include too many proprietary products in their portfolios.

The outsourced CIO model has exploded, overseeing $3 trillion in institutional assets, more than triple the level of 15 years ago. But it still has a way to go in improving the transparency that asset owners need from OCIO providers entrusted with managing holdings.

Endowments and foundations are too light on alternative investments, increasingly use outsourced CIOs and have cooled off a bit on environmental, social and governance issues, among the findings of a recent survey from CAPTRUST Financial Advisors.

Demand for the services of OCIOs is likely to remain robust in the coming years as institutions face a persistently volatile market environment requiring professional expertise, while the growing appeal of high-returning alternative assets will also buoy the need for OCIOs.

Asset owners are increasingly adopting outside help, as 7% expect to go the OCIO route over the next several years.

Replay and slides from CFA Institute’s Webinar on the Exposure Draft of the Guidance Statement for OCIO Strategies Now Available!

Mercer has reached an agreement to acquire the outsourced chief investment officer business of Vanguard.

2023 was supposed to be a down year for foundations and endowments with a potentially recessionary environment, however, equity and bond returns came out in the green, thanks in part to strong fourth quarters, leaving investors and allocators with a more optimistic outlook for their portfolios en

Managing an investment office for institutional investors can be a complex and costly endeavor.

Amid an expected pickup in consolidation for outsourced CIOs, top providers -- overseeing a mix of corporate, nonprofit and healthcare plan assets -- insist that scale is a friend, capable of accelerating their own growth while delivering better value for clients.

The long-term trend of shipping out investment management appears to have slipped for asset allocators, despite several large outsourcing arrangements being announced in recent months.

To stay up to date with insights and industry developments, please provide us with your contact information.

Ready to start looking for an OCIO? Get the information you need to choose the OCIO that is best for your needs. Know the OCIO landscape, understand your investment philosophy, identify implementation system preferences, and determine your key decision factors.

Find out how to partner effectively with your OCIO:  know what to expect during the transition to a new OCIO relationship.

Many institutions rely on one or more large pools of investments to support their operations.

Answer the questions in the table below. Scores 3 or higher indicate that OCIO could be an effective solution for your organization. 

Download the Assessment

We recommend that you request fee information in a format that makes it easier to assess many of these factors. 

Download OCIO Fee Template

Request performance information from an OCIO in the manner this is most helpful to you.  This toolkit is designed with best practices in mind.

Request performance information from an OCIO in the manner this is most helpful to you.  This template is designed with best practices in mind.

Download Performace Template

Defining Investments Outsourcing Investments outsourcing takes on many shapes and is often defined differently by various market participants.

Why do asset owners hire outsourced chief investment officers? To help them get the returns they want. As common-sensical as that sounds, this quest for good performance is woven into the OCIO appeal in a way that benefits the owners more than many realize.

Delve deeper into the key question: “What is an OCIO?” Understand why the OCIO model has become an important and effective investment solution for many organizations.

The strong growth of OCIO assets in the year ended March 31 likely will accelerate as institutional investors evaluate their funds' performance during the market turmoil in the first quarter and elect to outsource portfolio management, said OCIO managers and industry observers.

The OCIO market is one of those segments of the investment world that is seeing a significant increase in growth. Not only are managers that were created solely as OCIOs finding new opportunities, more traditional managers, including large fund complexes, are also being drawn into this market.

The Greenwich Roundtable has released a thoughtful paper, Best Governance Practices in Delegation and Consultant Selection for Long-Term Funds, which includes a solid sample RFP.

As outsourcing of the CIO role has gained momentum in recent years, with a throng of new entrants in the outsourcing arena, organizations needing an outsourced CIO (OCIO) are using traditional RFPs to identify suitable candidates.

How long will a search take? Even with a search consultant, the process of finding an optimal OCIO partner likely will take at least six months. 

The chief responsibility of an OCIO is to act as a trusted advisor and a co-fiduciary. Alignment, trust, transparency, and a spirit of partnership are critical ingredients of a successful OCIO relationship.

The overwhelming reason that institutional investors outsource investment management is a lack of internal resources.

The year ended March 31 was a strong one for OCIO managers, many of which had double-digit growth in assets under management thanks to a wave of new clients and strong performance.

Endowments are an increasingly precious resource to cover rising costs, strengthen financial resilience, support important initiatives, and help keep higher education affordable. The work of a college or university investment committee member has never been more important.

Poor governance by investment committees and asset management organizations often takes the form of other maladies, such as high turnover, high costs, performance-chasing, or rigid and counterproductive decision rules. These are often symptoms of broader governance ills.

A culture of good investment governance is based on the shared objectives, mutual respect, judgment and experience of the group of people working together to fulfill fiduciary responsibilities.

The challenges of investing are both technical and human. To excel, endowment stewards must be as attentive to potential land mines in governance as they are to those in global markets.

Although every organization will have specific requirements, some concerns are universal. Do not make a decision without confirming the ten key decision points in this toolkit.

In a Cerulli survey released in November 2020, 91% of search firms sampled said inadequate communication around investment performance was a challenge with OCIO providers, with more than a quarter saying it was a significant challenge. This aspect was the s

Answer these questions. A total score of 50 points or more indicates that OCIO could be an effective solution for your organization.

The pandemic has challenged everyone in many ways ― personally and professionally. The coronavirus has forced investment managers and their clients to grapple with yet another black swan crisis just over a decade since the last one.

Fees and expenses are always an important consideration in selecting an OCIO provider and asking detailed and probing questions of potential providers is critical in a diligence process.

OCIOs offer different “implementation systems” (ways of deploying client assets) that vary in customization from least to most customized as follows: Single Fund, Hybrid, and Fully Customized.

We recommend that you request fee information in a format that makes it easier to assess many of these factors. 

Request OCIO performance information in the manner that is most helpful to the investment committee.  This toolkit highlights best practices in OCIO performance reporting.

Considering hiring an OCIO Search Consultant? In this toolkit, we suggest questions to ask candidates.

Are you ready to create an RFP? For help drafting and RFI or RFP, we suggest this toolkit. 

There are many moving parts to an OCIO transition. It helps to break it down into three phases: documentation, transfer, and implementation.  

This toolkit illustrates the typical division of responsibilities between an Investment Committee and its OCIO.

We are committed to protecting your privacy and have adopted this Privacy Policy to let you know how your personal information is processed and used. This Policy applies solely to information collected by the Web pages owned and operated by Strategic Investment Management, LLC (Strategic).

Among the most important decisions a fiduciary body may be called upon to make is whether or not to outsource its organization's investment program, and which outsourced CIO to choose.

In this toolkit, we provide some detailed considerations for the organization to determine before looking for an OCIO.

The market for outsourced investment teams is “red hot” thanks to the darkening outlook for future returns, with allocators of capital increasingly delegating entire multibillion-dollar mandates to outside money managers. 

We offer this collection of toolkits on key topics as a resource for institutional investment committees, business leaders and industry professionals interested in the OCIO business model and best practices.

November 2 - 4, 2021 | Virtual Event  Back for a third successful year, P&I's all-inclusive OCIO conference will address the ‘why’ and the ‘how’ of the model and will share best practices on how to implement, evaluate, benchmark and evolve for the best out

The OCIO model provides an organization’s investment committee (or its equivalent) with these three inherent advantages of having an internal chief investment officer. 

Watch a replay of NACUBO’s webinar: “Navigating the Journey Towards Mission Alignment”.

A new study shows more private and community foundations are using outsourced CIO services, but people in the space say clients also want some customization.

Some firms offering outsourced chief investment officer, or OCIO, services are plotting their next moves after a year of remarkable equity returns which some firms may use to separate themselves from the pack.

The majority of search consultants expect to see an increase in discretionary advisor searches over the next year, according to a new survey.

Institutional investors are increasingly outsourcing their investment offices, yet investment committees still have issues with the idea of handing over full oversight of the portfolio to an external firm.

In this report, Chestnut Advisory Group, examines the industry trends driving OCIO growth and discusses steps asset managers and OCIOs can take to ensure their firms benefit from this growth.

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July 16 - 19, 2022 | Gaylord Rockies Resort | Denver and Online

NACUBO is excited to reconvene our members as we host the NACUBO 2022 Annual Meeting in Denver.

April 12 – 14, 2022 | Virtual Event

The 2022 AGB National Conference on Trusteeship will set the table for the governance work of strategic transformation. 

A need for heightened risk management is the leading impetus for companies to enlist outside help to manage investments.

In AGB’s newest podcast episode, David Bass, and Horacio Valeiras discuss how the environment in which investment committees operate today is different from the pre-pandemic era and some of the most significant lessons learned in recent years.

Increasing complexity of assets. A need to move quickly to adjust to volatile markets and uncertainty. Those are just a few of the reasons why industry experts and consultants say demand for outsourced CIO managers will only continue to grow.

Outsourced CIOs are a fast-growing part of the financial world, enabling asset allocators to farm out investment management. But how can institutions gauge the track records of OCIOs, a disparate group with wide-ranging approaches to investing?

Whether an organization hires a consultant or conducts its own search, the process is similar and can be divided into three phases: preparation, due diligence, and selection.

The CFA Institute has assembled a working group to help it decide on a method to measure the performance of outsourced chief investment officer, or OCIO, firms based on the Global Investment Performance Standards, known as GIPS.

Environmental, social and governance expertise is increasingly becoming a trump card for outsourced chief investment officers, or OCIOs, looking to gain traction with nonprofits in a crowded marketplace.

Institutional investors – and their search consultants – are struggling to compare the costs of outsourced chief investment officers, or OCIOs, as the market expands with a wide range of fee structures and approaches to underlying investments.

January 30 – February 1, 2022 | Hyatt Regency Grand Cypress | Orlando, FL

AGB’s Foundation Leadership Forum is the only national conference that focuses on excellence in governance and leadership for foundation boards and chief executives.