Sources say it’s partly due to the growing popularity of ESG investing, but there’s a lot more going on to fuel the trend, from increasing market complexity to the emergence of new regulations.

Samantha Davidson, U.S. outsourced chief investment officer (OCIO) business leader at Mercer, recently sat down for a discussion with PLANADVISER to mark her six month anniversary in the role.


Davidson says it has been “quite a busy and unique time” to be working in this space, noting a lot of her time has already been spent on the rapidly evolving topic of environmental, social and governance (ESG) as well as diversity, equity and inclusion (DE&I) investing, among other key areas.


“I had been at Goldman Sachs for 17 years before moving into this role, and it has been a big change for me,” Davidson says. “As you know, Mercer services clients globally, so we have the benefit of collaborating with clients to implement ESG programs internationally and are always looking to bring lessons here to the States.”


Davidson says the OCIO model has been around as a concept for 15 or 20 years, though there have been some entities using outsourcing for longer than that—say, 25 years.


“However, the trends have really shifted in 2020 and 2021,” she says. “Early on, the interest in using OCIOs was very concentrated among small and midsized organizations that didn’t have strong investment teams within their own organizations. In our experience and in our peers’ experience, this is changing, and OCIO is really moving up market in a significant way.”


Davidson says the high-level explanation for this development is not so mysterious. Essentially, these larger organizations feel like they need to put their people first and their focus elsewhere, and they want someone to steward their assets in a holistic and trusted fashion.


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