Operational Due Diligence
Aon’s Operational Risk and Solutions (“ORSA”) group provides operational due diligence (“ODD”) and monitoring for Aon Investments and its clients. Its services are also available to external clients that do not currently use Aon Investments for other investment consulting services.
ORSA is a specialty consulting team that focuses on helping clients identify operational risks that can exist within the investment management field. Its services include traditional, comprehensive pre-investment operational due diligence as well as a range of additional operational monitoring and consulting services. ORSA’s team has conducted more than 1000 full, pre-investment operational due diligence reviews of investment managers, around the world and across all asset classes.
Operational Risk IQ Platform
ORSA has developed its proprietary Operational Risk IQ platform to provide the backbone for its ODD and operational monitoring and consulting services. ORSA’s ODD IQ program and its patent-pending output, ODD IQ, allows the group to efficiently identify and quantify a broad range of potential operational risks that may exist among investment managers. The platform’s scalable and automated output provides complementary analytics to ORSA’s pre-investment ODD process and provides cost-effective reporting to support comprehensive ongoing monitoring of operational factors in multi-manager portfolios or approved manager platforms.
ODD IQ is designed to efficiently identify potential operational risks among investment managers and then quantify them through comparative analytics. ODD IQ is not intended to replace traditional ODD and its qualitative assessments, but rather to complement and improve them through the consistent use of objective factors, when possible. The platform’s scalable automation allows us to spend less time on the administrative aspects of ODD (collecting information and report writing) so that we can focus more time on risk assessment and reduction. The automated reporting capabilities further allow us to offer a range of service levels. Our toolkit approach allows end users to customize their experience based on resource capabilities, risk tolerance, and subject matter expertise. ODD IQ provides clients with the potential to actually increase their breadth and scope of coverage while committing less resources to an ODD program overall, particularly in relation to ongoing monitoring.
- Data is collected from managers through an online questionnaire covering approximately 175 predefined risk factors:
- Non-investment risks of using third-party investment managers to run a multi-manager portfolio, and
- Governance and operational policies, ranging from the organization’s structure to its technology and cyber security capabilities, to its trade settlement and back office functions.
- Reporting helps to quickly identify potential exposures, whether to an individual manager or across a multi-manager portfolio
- ODD IQ provides objective, auditable reports to meet regulatory or assurance obligations.
Are ORSA’s pre-investment ODD services or ODD IQ services right for you?
Aon ODD IQ can benefit investors in retirement plans, endowments/foundations, family offices, wealth management platforms, registered investment advisors, and managed account platforms. We help investors in high-volume, multi-manager environments who need:
- Assistance launching an ODD program
- Ongoing due diligence monitoring
- Investment screening to narrow manager evaluations
ODD and ODD IQ Service Levels
You can pair ODD IQ with full-service ORSA ODD assessments by experienced due diligence professionals, including independent qualifications, interviews, documentation and analysis. We offer three levels of service:
- ODD IQ – Our lowest priced offering is designed for groups with internal expertise and provides automated critical exposure reporting
- ODD IQ Plus – This service level provides the reporting of ODD IQ “plus” an ORSA consultant’s expertise for those who need additional expertise to develop risk management strategies
- Full ODD – Comprehensive, traditional operational due diligence that incorporates ODD IQ reporting and our independent qualitative assessment of an expanded range of potential risk factors