What Is an Outsourced Chief Investment Officer?
An outsourced chief investment officer (OCIO) is a resource for organizations that can take on accountability and fiduciary responsibility for an asset pool, including strategic investment decisions. An OCIO also aims to manage liquidity trading costs, protect against drawdowns and shield investment committees from potential litigation. Given the increased complexity of institutional investment programs, an OCIO can help investors access the expertise and scale they need to get the most out of their portfolios.
What Are the Benefits of Partnering With an Outsourced CIO?
In today's volatile environment, traditional solutions for managing and governing asset pools and investment strategies no longer meet the needs of many investors. Clients need experienced partners with broad expertise to mitigate risks and effectively execute investment decisions. Key benefits of an OCIO include:
Enhanced GovernanceOur delegated investment solutions allow fiduciaries to focus on strategic issues with the biggest impact on outcomes, including:
- Asset mix
- Investment structure
- Risk management
Time SavingsPartnering with our team allows asset sponsors to focus more of their energy on their organizations by spending less time managing their investments.
Lower CostsAggregating global delegated assets increases the collective buying power for investment and delivers potential costs savings to all delegated/OCIO clients.
Unbiased Advice and ImplementationOur open architecture and transparent fee model allow us to implement solutions we believe are in the best interest of our clients. We also leverage the expertise of investment managers who are buy-rated by Aon, and we ensure independence throughout our process.
Faster ExecutionOur ability to use discretion allows us to act quickly on asset allocation or investment manager changes. Clients don't need to worry about missing out on opportunistic investments or decision-making delays impacting investment performance.
Seek Better OutcomesDelegated investment solutions provide easier access to asset classes (including alternatives) and preferred investment strategies, potentially improving risk-adjusted returns through increased diversification and custom risk management strategies.1
1 Diversification does not ensure a profit nor does it protect against loss of principal. Diversification among investment options and asset classes may help to reduce overall volatility.
Why Should I Choose a Consultant as an OCIO?
Our consultants harness Aon's full capabilities to help you make better decisions. Whether you select our team to provide fully or partially delegated investment solutions, we have the investment, fiduciary and operational resources to meet your needs.
Our OCIO model is a truly consultative approach. We'll partner with you to understand your business and investment goals and bring the right data, insights and expertise to the conversation as needed, including:
- 1 Alternatives Expertise
- 2 Benefits Benchmarking
- 3 Cyber
- 4 Environment, Social and Governance Consulting
- 5 Fiduciary Liability and Directors’ and Officers’ Insurance
- 6 Human Capital Consulting
- 7 Intellectual Property Solutions
- 8 Mergers and Acquisitions Services
- 9 Operational Due Diligence
- 10 Pooled Employer Plans
What Should I Look for in an OCIO?
Whether you’re speaking to our team or another potential OCIO provider, we encourage you to ask the following questions.
- Does the OCIO have the scale and infrastructure to support multiple competencies and investment specialties?
- Can the OCIO access all asset classes and allocate assets across a range of risks?
- How transparent is the OCIO's pricing process?
- Does the OCIO have a financial incentive to include or exclude any particular investment manager or
sell its products?
- Does the OCIO have a history of generating returns and meeting client expectations?