Survey
Respondent Profile
Respondent Organization Type
| Corporate Pension | 30% |
| Public Pension | 21% |
| Endowment/Foundation | 33% |
| 401(k), 403(b), 457 DC plan | 30% |
| Other | 7% |
Respondent Regions Represented
| Europe/Pacific/Other | 9% |
| Canada | 12% |
| USA | 79% |
Respondents by Total Investable Portfolio Size
| >$500MM | 31% |
| $500MM–$5B | 46% |
| <$5B | 24% |
Staffing
Average Size of Investment Staff by Organization Type
| Corporate Pension | 5 |
| Public Pension | 5 |
| Endowment/Foundation | 3 |
| 401(k), 403(b), 457 DC plan | 3 |
| Other | 2 |
Average Size of Investment Staff by Region
| USA | 3 |
| Canada | 4 |
| Europe/Pacific/Other | 10 |
Average Size of Investment Staff by Investable Portfolio Size
| <$500MM | 1 |
| $500MM–$5B | 2 |
| >$5B | 11 |
Outsourcing Arrangements
Respondent Outsourcing Situation
| Plan to outsource in the next 24 months | 1% |
| Currently outsource | 35% |
| Do not outsource and no plans to do so | 60% |
| Plan to outsource in the next 12 months | 4% |
% That Outsource or Plan To by Organization Type
| Corporate Pension | 44% |
| Public Pension | 39% |
| Endowment/Foundation | 43% |
| 401(k), 403(b), 457 DC plan | 56% |
| Other | 33% |
% That Outsource or Plan To by Region
| USA / Canada | 39% |
| Europe / Pacific | 50% |
% That Outsource or Plan To by Investable Portfolio Size
| <$500MM | 58% |
| $500MM–$5B | 38% |
| >$5B | 20% |
Reasons for Outsourcing
Reasons for Outsourcing and Their Importance
1=Not at all important; 5=Very important
| Score | 1 | 2 | 3 | 4 | 5 | |
| Better risk management | 4.1 | 3% | 7% | 17% | 24% | 48% |
| Cost savings | 3.4 | 10% | 17% | 21% | 28% | 24% |
| Lack of internal resources | 4.1 | 3% | 7% | 10% | 38% | 41% |
| Additional fiduciary oversight | 3.8 | 7% | 0% | 28% | 34% | 31% |
| Need to increase returns | 3.4 | 14% | 10% | 21% | 28% | 28% |
| Faster implementation/decisions | 3.7 | 7% | 10% | 24% | 28% | 31% |
| Desire for strategic partnership | 3.2 | 17% | 14% | 21% | 28% | 21% |
Outsourcing Goals
|
All respondents
|
<$500MM
|
$500MM–$5B
|
>$5B
|
|
| Absolute return | 64% | 71% | 58% | 50% |
| De-risking | 36% | 29% | 42% | 50% |
Fee Structures
Outsourcing Fee Structure
|
All respondents
|
<$500MM
|
$500MM–$5B
|
>$5B
|
|
| Flat basis point fees ONLY | 59% | 50% | 69% | 50% |
| Sliding asset-based fees ONLY | 17% | 21% | 15% | 0% |
| Multiple or Other fee structures used | 24% | 29% | 15% | 50% |
| 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 | 77% | 73% | 79% | 76% |
| Yes | 23% | 27% | 21% | 24% |
Reasons for Not Considering an Outsourcing Arrangement and Their Importance
1=Not at all important; 5=Very important
| Score | 1 | 2 | 3 | 4 | 5 | |
| Execute better risk management in-house | 3.8 | 9% | 0% | 28% | 25% | 38% |
| Cost | 4.0 | 6% | 4% | 17% | 30% | 43% |
| Sufficient internal expertise | 4.1 | 6% | 2% | 8% | 45% | 40% |
| No need for additional fiduciary oversight | 3.5 | 9% | 6% | 32% | 28% | 25% |
| Satisfied with returns produced internally | 4.2 | 4% | 0% | 9% | 45% | 42% |
| Satisfied with speed of implementation | 4.0 | 4% | 2% | 21% | 40% | 34% |
| No desire for partnership with outside firm | 3.3 | 19% | 6% | 28% | 25% | 23% |