
New GIPS Standards Guidance for OCIOs: What You Need to Know
Sean P. Gilligan, CFA, CPA, CIPM
February 3, 2025

The Global Investment Performance Standards (GIPS®) have released a new Guidance Statement for OCIO Portfolios, bringing greater transparency and consistency to the way Outsourced Chief Investment Officers (OCIOs) report performance. This update is a significant milestone for firms managing OCIO Portfolios and asset owners looking to evaluate their OCIO providers.
What is an OCIO?
An Outsourced Chief Investment Officer (OCIO) is a third-party fiduciary that provides both strategic investment advice and investment management services to institutional investors such as pension funds, endowments, and foundations. Instead of building an in-house investment team, asset owners delegate investment decisions to an OCIO, which handles everything from strategic planning to portfolio management.
Who Does the New Guidance Apply To?
The Guidance Statement for OCIO Portfolios applies when a firm provides both:
- Strategic investment advice, including developing or assessing an asset owner’s strategic asset allocation and investment policy statement.
- Investment management services, such as portfolio construction, fund and manager selection, and ongoing management.
This ensures that firms managing OCIO Portfolios follow standardized performance reporting, making it easier for prospective clients to compare OCIO providers.
Who is Exempt from the OCIO Guidance?
The guidance does not apply in the following scenarios:
- Investment management without strategic advice – If a firm only manages investments without advising on asset allocation or investment policy.
- Strategic advice without investment management – If a firm provides recommendations but does not manage the portfolio.
- Partial OCIO portfolios – If a firm only manages a portion of a portfolio, rather than the full OCIO mandate.
- Retail client portfolios – The guidance is specific to institutional OCIO Portfolios and does not apply to retail investors including larger wealth management portfolios.
Key Change: Required OCIO Composites
Previously, OCIO firms had flexibility in defining their performance composites. Now, the GIPS Standards introduce Required OCIO Composites, which categorize portfolios based on strategic asset allocation.
Types of Required OCIO Composites
- Liability-Focused Composites – Designed for portfolios aiming to meet specific liability streams, such as corporate pensions.
- Total Return Composites – Focused on capital appreciation, commonly used by endowments and foundations.
Firms must classify OCIO Portfolios based on their strategic allocation, not short-term tactical shifts. This standardization enhances comparability across OCIO providers. The specific allocation ranges for the required composites are as follows:
Required OCIO Composites for OCIO Portfolios

Performance Calculation & Reporting
To ensure transparency, firms must follow specific rules for return calculations and fee disclosures:
- Time-weighted returns (TWR) are required, even for portfolios with private equity or real estate holdings.
- Both gross and net-of-fee returns must be presented to clarify the true cost of OCIO management.
- Fee schedule disclosures must include all investment management fees, including fees from proprietary funds and third-party placements.
Enhanced Transparency in GIPS Reports
The new guidance also requires OCIO firms to disclose additional portfolio details, such as:
- Annual asset allocation breakdowns (e.g., growth vs. liability-hedging assets).
- Private market investment and hedge fund exposures.
- Portfolio characteristics, such as funding ratios and duration for liability-focused portfolios.
By providing these details, OCIO firms enable prospective clients to make better-informed decisions when selecting an investment partner.
When Do These Changes Take Effect?
The Guidance Statement for OCIO Portfolios is effective December 31, 2025. From this date forward, GIPS Reports for Required OCIO Composites must follow the new standards. However, firms are encouraged to adopt the guidance earlier to improve transparency and reporting consistency.
Why This Matters
With OCIO services growing in popularity, this new guidance ensures that firms adhere to best practices in performance reporting. By establishing clear rules for composite classification, return calculation, and fee disclosure, the guidance empowers asset owners to compare OCIO providers with confidence.
As the December 31, 2025 deadline approaches, OCIO firms should begin aligning their reporting practices with this new guidance to stay ahead of the curve.
Don’t miss CFA Institute’s webinar scheduled for this Thursday February 6, 2025 to hear more on this guidance statement.
Questions?
If you have questions about the Guidance Statement for OCIO Portfolios or the Standards in general, we would love to talk to you. Longs Peak’s professionals have extensive experience helping firms become GIPS compliant as well as helping firms maintain their compliance with the GIPS Standards on an ongoing basis. Please feel free to email us at hello@longspeakadvisory.com.