2022 Outsourced-Chief Investment Officer Survey

Survey


Respondent Profile

Respondent Organization Type

Corporate Pension 30%
Public Pension 20%
Endowment/Foundation 39%
401(k), 403(b), 457 DC plan 31%
Other 8%

Respondent Regions Represented

USA 75%
Canada 13%
Other 12%

Respondents by Total Investable Portfolio Size

<$500MM 33%
$500MM–$5B 38%
>$5B 30%

Staffing

Average Size of Investment Staff by Organization Type

Corporate Pension 5
Public Pension 3
Endowment/Foundation 4
401(k), 403(b), 457 DC plan 6
Other 7

Average Size of Investment Staff by Region

USA 4
Canada 2
Other 15

Average Size of Investment Staff by Investable Portfolio Size

<$500MM 2
$500MM–$5B 4
>$5B 8

Outsourcing Arrangements

Respondent Outsourcing Situation

Currently outsource 30%
Do not outsource and no plans to do so 70%

% That Outsource or Plan To by Organization Type

Corporate Pension 28%
Public Pension 0%
Endowment/Foundation 33%
401(k), 403(b), 457 DC plan 47%
Other 0%

% That Outsource or Plan To by Region

USA / Canada 33%
Europe / Pacific 0%

% That Outsource or Plan To by Investable Portfolio Size

<$500MM 50%
$500MM–$5B 26%
>$5B 11%

Types of Outsourcing Arrangements Used/Planned

All respondents
<$500MM
$500MM–$5B
>$5B
Full discretion 59% 56% 83% 0%
Partial discretion 41% 44% 17% 100%

How Much of the Portfolio Is Outsourced

All respondents
<$500MM
$500MM–$5B
>$5B
100% outsourced 83% 100% 67% 50%
75% – 99% outsourced 11% 0% 33% 0%
50% – 74% outsourced 0% 0% 0% 0%
25% – 49% outsourced 0% 0% 0% 0%
<25% outsourced 6% 0% 0% 50%

Reasons for Outsourcing

Reasons for Outsourcing and Their Importance

1=Not at all important; 2=Slightly important; 3=Moderately important; 4=Important; 5=Very important

Score 1 2 3 4 5
Better risk management 4.3 0% 6% 11% 33% 50%
Cost savings 3.2 22% 11% 11% 39% 17%
Lack of internal resources 4.2 0% 11% 17% 17% 56%
Additional fiduciary oversight 4.1 0% 11% 17% 28% 44%
Need to increase returns 3.6 6% 0% 33% 50% 11%
Faster implementation/decisions 3.9 6% 0% 22% 39% 33%
Desire for strategic partnership 3.4 22% 0% 17% 33% 28%

Outsourcing Goals

All respondents
<$500MM
$500MM–$5B
>$5B
Absolute return 67% 60% 100% 0%
De-risking 33% 40% 0% 100%

Fee Structures

Outsourcing Fee Structure

All respondents
<$500MM
$500MM–$5B
>$5B
Flat basis point fees ONLY 67% 80% 67% 0%
Sliding asset-based fees ONLY 28% 10% 33% 100%
Multiple or Other fee structures used 6% 10% 0% 0%
Performance fees ONLY 0% 0% 0% 0%

Non-Outsourcers

To your knowledge, have any OCIO providers attempted to win your business in the past 12 months?

All respondents
<$500MM
$500MM–$5B
>$5B
No 73% 44% 71% 93%
Yes 27% 56% 29% 7%

Reasons for Not Considering an Outsourcing Arrangement and Their Importance

1=Not at all important; 2=Slightly important; 3=Moderately important; 4=Important; 5=Very important

Score 1 2 3 4 5
Execute better risk management in-house 4.2 0% 2% 17% 39% 41%
Cost 3.9 3% 13% 15% 35% 35%
Sufficient internal expertise 4.2 2% 2% 12% 39% 44%
No need for additional fiduciary oversight 3.5 7% 12% 27% 27% 27%
Satisfied with returns produced internally 4.4 2% 0% 5% 44% 49%
Satisfied with speed of implementation 4.2 0% 2% 17% 41% 39%
No desire for partnership with outside firm 3.5 10% 10% 20% 39% 22%