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Why nonprofit investment committees are going to OCIO

Portfolio returns are critical to supporting spending and achieving nonprofit investment committee goals. But investing today is more challenging than ever, due to:

  • Complex and volatile markets
  • Stretched resources and tight budgets
  • Overworked committee members
  • Infrequent committee meetings that stymie timely decision-making

These challenges can get in the way of a nonprofit's long-term success.

That's why more investment committees are moving to an OCIO model.

Working with an OCIO allows you to focus on strategic activities.

Committees realize that they can gain valuable resources, advice and infrastructure – key elements to a timely and more successful investment portfolio – by working with an OCIO provider.

Hiring an OCIO gives you:

  1. Access to dedicated nonprofit investment specialists
  2. An infrastructure that enables more nimble investment decision-making
  3. An opportunity to improve performance
  4. Potential access to lower fees than you are currently paying

Reallocate your time to making critical decisions

There are many myths associated with the OCIO model, including that committee members' roles will be minimized. In fact, it's just the opposite -- you can have a higher overall impact, as you can focus on critical asset allocation decisions, long-term planning and overall strategy.

A flexible OCIO model allows you to:

  • Maintain control over the roles you want the committee to have in the portfolio decision-making 
  • Delegate some of the day-to-day investment-related tasks, like manager monitoring and selection
  • Gain improved governance, more strategic control and time to focus on decisions that can positively impact your mission

Access to resources and advice

A dedicated Client Portfolio Manager, backed by a support team that includes investment and advice experts, can help nonprofit committees hit the ground running. You establish the investment policy statement, and together you develop a custom asset allocation.

The most valued OCIOs bring the following to the table:

  1. In-depth quarterly meetings with economic, manager and asset class reviews
  2. Asset allocation advice and modeling that demonstrates the potential impacts of investment decisions
  3. Timely portfolio adjustments/manager changes with full transparency
  4. Spending and hurdle rate analysis
  5. More comprehensive risk management and continuous monitoring
  6. Ongoing education on industry developments, market trends and portfolio changes
  7. Support for your donor and fundraising efforts

Find out more about our award-winning OCIO model

Helping you achieve your mission is our number one goal. We're competitively priced, results-focused and supported by significant infrastructure. Learn more about our OCIO program.

Information provided by SEI Investments Management Corporation (SIMC), a registered investment adviser and wholly owned subsidiary of SEI Investments Company.

This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. The content is for educational purposes only. Investing involves risk, including possible loss of principal.

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Don't forget this key criteria you'll want to consider when researching the OCIO model.

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Mary Jane Bobyock, CFA

Managing Director, Nonprofit Advisory Team, Institutional Group