Key Takeaways
- • BlackRock's OCIO unit, housed within its multi-asset strategies and solutions platform, manages more than $360 billion in assets, according to the article.
- • The global OCIO industry grew from about $1 trillion in 2015 to more than $3.3 trillion in 2024, per Cerulli Associates, and BlackRock estimates OCIO assets will reach $5.6 trillion by the end of the decade.
- • Goldman Sachs Asset Management won a combined $70 billion in defined benefit and defined contribution mandates this year from Verizon Communications and Lockheed Martin.
- • Ryan Marshall, global head of multi-asset strategies at BlackRock, says healthcare allocators will be the next area of rapid OCIO outsourcing growth, with the healthcare segment compounding at 20% annually over the past four years.
- • BlackRock's average OCIO pension client brings roughly $3 billion in assets, versus about $500 million for endowment and foundation clients, and the firm is targeting endowments, foundations and family offices for growth.
Summary
The outsourced chief investment officer market has expanded beyond the smaller institutions that initially drove its growth, as larger asset owners increasingly delegate investment management, portfolio construction and other investment-office functions to external providers. BlackRock Inc. is among the managers benefiting from this shift. Its OCIO unit, housed on the multi-asset strategies and solutions platform, manages more than $360 billion, according to the article.
Ryan Marshall, global head of multi-asset strategies at BlackRock, attributes the firm's position to the scale of its resources and portfolio size, along with specialized client service across client types. Citing Cerulli Associates data, the article reports that the OCIO industry grew from around $1 trillion in 2015 to more than $3.3 trillion in 2024, and BlackRock estimates OCIO assets will reach $5.6 trillion by the end of the decade. Marshall says that rising demands on investment teams, including the cost of technology platforms, public and private market coverage, and the need to deploy artificial intelligence, are prompting even large organizations with strong in-house capabilities to outsource. He notes that some chief operating officers and CFOs now question why non-asset-management companies such as airlines, manufacturers and healthcare organizations maintain in-house asset managers.
Corporate defined benefit pensions have driven much of the market's upmarket movement. Improved funded status has shifted sponsors' priorities from closing deficits to protecting surpluses and limiting downside risk. The article reports that Goldman Sachs Asset Management won a combined $70 billion in defined benefit and defined contribution assets this year from Verizon Communications and Lockheed Martin. Other notable mandates cited include UPS ($43.3 billion), Shell PLC ($70 billion across two mandates), BAE Systems ($28.2 billion) and Eli Lilly ($25 billion). Marshall says BlackRock's average OCIO pension client brings about $3 billion in assets, while endowment and foundation portfolios average around $500 million, and he expects the largest increase to come from the endowment and foundation segment.
Marshall identifies healthcare allocators as the next area of rapid growth, noting the segment has compounded at 20% annually over the last four years. Healthcare institutions often must balance operating requirements, capital projects, pension obligations and foundation assets, each with different liquidity needs and horizons, which creates demand for a balance-sheet-level OCIO approach. BlackRock is also looking to grow among endowments, foundations and family offices, which Marshall says are less aware of the firm's OCIO business than defined benefit plans. "That's a big area of focus for us globally," he says.
Ryan Marshall, global head of multi-asset strategies at BlackRock, attributes the firm's position to the scale of its resources and portfolio size, along with specialized client service across client types. Citing Cerulli Associates data, the article reports that the OCIO industry grew from around $1 trillion in 2015 to more than $3.3 trillion in 2024, and BlackRock estimates OCIO assets will reach $5.6 trillion by the end of the decade. Marshall says that rising demands on investment teams, including the cost of technology platforms, public and private market coverage, and the need to deploy artificial intelligence, are prompting even large organizations with strong in-house capabilities to outsource. He notes that some chief operating officers and CFOs now question why non-asset-management companies such as airlines, manufacturers and healthcare organizations maintain in-house asset managers.
Corporate defined benefit pensions have driven much of the market's upmarket movement. Improved funded status has shifted sponsors' priorities from closing deficits to protecting surpluses and limiting downside risk. The article reports that Goldman Sachs Asset Management won a combined $70 billion in defined benefit and defined contribution assets this year from Verizon Communications and Lockheed Martin. Other notable mandates cited include UPS ($43.3 billion), Shell PLC ($70 billion across two mandates), BAE Systems ($28.2 billion) and Eli Lilly ($25 billion). Marshall says BlackRock's average OCIO pension client brings about $3 billion in assets, while endowment and foundation portfolios average around $500 million, and he expects the largest increase to come from the endowment and foundation segment.
Marshall identifies healthcare allocators as the next area of rapid growth, noting the segment has compounded at 20% annually over the last four years. Healthcare institutions often must balance operating requirements, capital projects, pension obligations and foundation assets, each with different liquidity needs and horizons, which creates demand for a balance-sheet-level OCIO approach. BlackRock is also looking to grow among endowments, foundations and family offices, which Marshall says are less aware of the firm's OCIO business than defined benefit plans. "That's a big area of focus for us globally," he says.
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