2023 CIO

Sentiment survey

The 2023 CIO Sentiment Survey, a global collaboration between Top1000funds.com and CaseyQuirk, part of Deloitte Consulting, finds asset owners keeping their allocations static but focusing on agility as they observe dramatic market changes not seen in a generation. With a majority lacking confidence that they will meet their return targets, respondents are re-evaluating their equity exposures, re-structuring their fixed income allocations and de-emphasising private markets.

Key Themes

Most asset owners are planning ‘no change’ in allocation shifts as they wait for clearer market signals

Investors are cooling on private markets, especially private equity, with most predicting write-downs for at least another year

Resources and time are stretched, with CIOs saying their internal teams are under-resourced, talent markets are tight, and they face personal time constraints

Wait-and-see approach as historic market shifts take place

The year 2022 presented market conditions not seen in a generation. It was the first year in more than four decades where equities and bonds fell in tandem. Runaway inflation and its implications for markets dominated the headlines. Geopolitical concerns, the rising cost of goods, and an extremely tight talent market all contributed to the complex landscape asset owners are now navigating.

The 2023 Global CIO Survey, which garnered responses 55 chief investment officers of global pension funds, finds asset owners in a holding pattern, waiting for more information to decide their next move. Allocations are being kept fairly static despite a dramatically reshaped market environment, with 73 per cent of respondents planning ‘no change’ in allocation shifts – a higher proportion than the previous three years.

2022 presented investment conditions not seen in a generation

Equity and Bond Annual Returns
Count of up vs down years, 1980 2022

Equities Up, Bonds Up
Equities Down, Bonds Up
Equities Up, Bonds Down
Equities Down, Bonds Down


In addition, there was a plunge in confidence among CIOs that they will meet their return targets, with only 36 per cent of participants expecting they will. Only 11 per cent are taking on additional risk to achieve return targets due to the uncertainty of markets.

Tyler Cloherty, managing director and leader of Deloitte Strategy and Analytics’ Knowledge Center, said he was surprised to find such static portfolios despite enormous structural changes in the investment landscape.

73 per cent of respondents planning ‘no change’ in allocation shifts

Asset owners are avoiding large-scale allocation changes during an uncertain environment.

CIOs are less confident about meeting return targets and are wary of taking additional risk.

CIOs Planning ‘No Change’ in Allocation Shifts Median, including equity, fixed income and solutions , 2020-2023


Confident in Meeting Return Target?
% “Yes” response, % of respondents, 2019-2023


“Considering everything that’s been happening, I would have thought there would be significant restructuring,” Cloherty said. “Maybe that will start to unfold over the next six months.”

When asked about this apparent stalemate, Andrew Lill, CIO at Australian retirement fund REST Super, said data-driven CIOs are taking a “wait and see” approach in the current market.

“It is not clear at this stage whether taking more risk, or de-risking, is the right course of action, as markets are currently very data driven,” Lill said. 

Part of the reason CIOs are not confident in hitting their targets is probably the prevalence of CPI+ targets, which makes hitting targets a challenge when inflation is high but asset class returns are moderate, he said.

Private markets out of favour, fixed income looking up

Amidst heightened risk concerns, CIOs are re-evaluating their equity exposures. The data found liquid equity exposures in a holding pattern, but 31 per cent said they are considering shifting their equities to more inflation-proof sectors. 

They are also de-emphasising private markets and expecting write-downs to continue until at least the end of 2023. Private equity optimism waned to a five-year low with only a handful of respondents planning to increase their private equity allocations this year.

“Investors are really cooling on private markets, especially PE, as valuations remain high and they are thinking about whether they have over-allocated in past years,” said Diane Cullen, senior consultant at CaseyQuirk.

Fixed-income allocations are also being re-structured due to fundamental changes in the rate environment, leading to a resurgence of high-quality active fixed income, and tactical increases in active emerging market debt to take advantage of high yields. 

Christopher Ailman, chief investment officer of CalSTRS, which is the second largest public pension fund in the United States, said fixed income allocations had shrunk in recent years but higher returns are now reversing that trend.

“Now that [fixed income] will have 4-6 per cent return, people will be putting in more money,” Ailman said. “It’s not a massive asset allocation change, the 80/20 portfolio was creeping to 85/15, and it will go back to 80/20. That return on cash and fixed income will help with overall returns.”

CIOs are also adjusting their portfolios to include more inflation-hedging strategies, adding exposure to real assets and private credit, and shifting equities to more inflation-proof sectors.

“Investors are really cooling on private markets”

Taking More Risk to Achieve Return Target?

% “Yes” response, % of respondents, 2021-2023


Plans are adding more sparingly to their private market allocations, with the lowest growth in three years

CIOs Planning Net Increase* in Total Private Market Allocation
% of respondents, 2023


*Net increase equals % of plans that are increasing allocations less % of those that are decreasing allocations

Strained resources, tight talent market

Asset owners are clearly feeling resource-constrained, and are looking to hire more staff, gain assistance from investment consultants, and gain efficiencies.

Understaffed internal teams and a shortage of talent were selected as top concerns by 58 per cent of respondents. There was also a large jump compared to previous years in respondents noting ‘personal time constraints.’ 

“The last 12-18 months has been a challenging talent market to try to get people in the door,” Cloherty said. “Asset owners are competing in the same talent pool against commercial asset managers, they are often not able to pay as much, not able to react as quickly to fill positions, and more hamstrung to get the best quality talent in the door.”

Effectively incorporating sustainability goals is, unsurprisingly, a major challenge, with many respondents also noting they lack the necessary systems and tools. Other related options checked by large minorities included ’External stakeholder pressures’ including media and regulators, and ‘Aggressive/ambitious plan objectives.’

Hoped-for efficiency gains from technology investments appear to be slow to arrive, with 57 per cent feeling digital advancements have not significantly enhanced their manager due diligence process. 

Responding to these challenges, the majority are planning to increase their investment staff over the next 18 months, with significant cohorts also planning to increase resourcing to operations, risk management and legal/compliance. 

Asset owners are also leaning more on support networks, with larger numbers planning to use investment consultants than in previous years.

Respondents are increasingly co-opting managers into their ESG goals, with 71 per cent collaborating with investment managers to increase transparency and develop best practices. 

This is happening alongside an ongoing shift towards internal management, suggesting asset owners are leaning more heavily on a smaller number of key strategic partners.