What is a chief investment officer? Definition and meaning

A chief investment officer, often referred by just the initials CIO, is a board-level executive who is head of investments within an organization, or head of an institution’s investment portfolio in charge of a team of professionals that manage and monitor investments.

The initials CIO may also mean chief information office or chief investment office.

Investment refers to the use of resources to make more money, or bring income and other benefits in the future.

The chief investment officer and team are typically responsible for managing and supervising investment activity, placing investment orders, managing pension investments, maintaining good investor relations, and working with external analysts. The team also develops short- and long-term investment policies.

Chief Investment OfficerOnce found just in large corporations, chief investment officers are becoming more common in medium-sized companies.

The CIO also reports portfolio performance to directors and other executives.

The chief investment officer typically works together with the chief financial officer (CFO). Many report directly to the chief executive officer (CEO), providing regular updates on the status of the corporation’s investment activities.

Good CIOs need to wear two hats; their first-line goal is to achieve a return, while their second-line objective is to manage risk levels. Having to focus on both goals invariably creates conflicts.

Chief investment officers at universities

CIOs are often part of the leadership of colleges and universities, especially those that make investments that help bring in income to maintain scholarships, campuses, and other important functions.

The CIO advises the university’s board members and other officers regarding the current status of the institution’s investment portfolio. They also make recommendations on any changes to the portfolio that they think need to be made.

According to Ohio State University, a CIO’s duties and responsibilities include:

– Establishing and maintaining a financial and operational processing environment that focuses on ethical standards and appropriate internal controls.

– Advising the President, Development and Investments Committee and Senior Vice President for Business and Finance on matters related to the university’s investment portfolio, and its performance.

– Maintaining an investment manager search process to make sure best use is being made of staff (and that staff selection is good).

– Establishing relationships within the global investment community to ensure the institution has access to best-in-class research and managers.

According to the Financial Times Lexicon:

“A chief investment officer, or CIO, is the head of an institution’s investment portfolio who is responsible for overseeing a staff of professionals that manage and monitor investments.”

Video – Meet a CIO

In this video, Sunil Singhania talks about his job as a chief investment officer.