[FIRESIDE CHAT] Overview of the updated Universal Standards

  • Laura FOOSE, SPTF


Laura FOOSE opened this session by introducing the Social Performance Task Force (SPTF), explaining that SPTF members, representing every stakeholder group in the inclusive finance sector, develop and promote standards and good practices for social and environmental performance management. She referred to the main point to be discussed in this session: the updated Universal Standards for Social and Environmental Performance Management which will be launched in January 2022.

Foose continued by stating the relevance of the Universal Standards for Social and Environmental Performance Management to the responsible provision of digital financial services. SPTF created the Universal Standards as a manual grounded in real practices to support financial service providers (FSPs) in aligning their policies and procedures with responsible business practices. She described the seven dimensions of the Universal Standards, being: Social Strategy; Committed Leadership; Client-centred Products and Services; Client Protection; Responsible Human Resource Development; Responsible Growth and Returns; and Environmental Performance Management. These dimensions can be divided in two categories: do good and do no harm.

Foose stressed the importance for financial institutions to act in the interest of all stakeholders to remain relevant. She pointed out the relation between the emergence of crises and attention for Social Performance Management to increase the resilience of financial service providers. Furthermore, technological innovation has allowed clients, employees, and vulnerable communities to voice their concerns about social issues related to financial inclusion on digital platforms. Overall, there is an increasing recognition of the importance of Social Performance Management as part of Environmental, Social and Governance (ESG) practice.

Amelia GREENBERG explained that SPTF/CERISE update the Universal Standards approximately every five years, to reflect the changing nature of financial service provision, in particular in current times with climate change and the digital revolution. Greenberg continued by explaining the process of revising the Universal Standards for Social and Environmental Performance Management. SPTF starts with expert interviews held for each of the seven dimensions. Subsequently, the experts’ feedback is condensed and synthesized, as well as complemented by documented knowledge, such as research studies and toolkits. The proposed changes are communicated with SPTF/CERISE members to solicit their input, after which a final review is done by the SPTF board. Once the revisions to standards and practices are formalised, SPTF/CERISE updates the indicators in the SPI evaluation tool.

Greenberg provided an overview of the main changes to the Universal Standards:

  • In terms of language, the previous language focused on which policies are in place, but the updated version focuses on what FSPs are actually ‘’doing’’.
  • With regards to data collection and analysis of outcomes, financial service providers should not only include indicators determining client benefits, but also measure unintended negative outcomes for clients and households. Moreover, FSPs should analyse their data by segments of clients,  to ensure better data insights. Other changes are the stronger emphasis on quantitative data collection to complement qualitative data and the use of existing data to inform product design.
  • The responsible business practices related to employees are now concentrated into a single dimension (Dimension 5: Responsible Human Resource Development), SPTF/CERISE has also strengthened the elements around developing and promoting staff.
  • Whereas Dimension 6 on Responsible Growth and Returns used to cover standards for financial service providers and investors, it is now focused on what financial service providers have control over. Furthermore, the practices within the standard on growth now focus specifically on risks to clients and to employees due to growth.
  • There is a new mandatory seventh dimension on green performance, which is aligned with the Green Index 3.0 developed by the e-MFP Green Inclusive & Climate Smart Finance Action Group.

Foose underlined the relationship between the Universal Standards, the SPI tool, and ratings and certifications. The Universal Standards provide a framework for harmonization of social and environmental performance management and reporting by financial service providers. She explained that the SPI tool is the assessment and reporting tool for the Universal Standards. The SPI tool and rating and certification frameworks are annually revised to ensure alignment with the updated Universal Standards. She highlighted the new design of SPI online by CERISE, providing multiple entry points for companies to use the tool.

Greenberg presented what is coming next year in terms of updating the standards to address responsible digital financial services in the current digital context. The Universal Standards apply to all FSPs, including digital financial service providers, but there are additional specific client protection risks in digital finance, and SPTF is working to identify the management practices that mitigate those risks. To do so, SPTF is conducting document review and expert interviews, and will publish in early 2022 a draft set of responsible DFS management standards based on its findings. SPTF will then launch a working group to invite all interested parties to further discuss and refine these DFS standards. Greenberg finished with a call to action to join this Working Group and referred to resources on SPTF’s website.


An audience member asked if the ALINUS tool has been adapted simultaneously with updating the SPI4 and the Universal Standards. Foose confirmed that the Investor Working Group is currently in the process of selecting indicators from the updated SPI tool to be included in an updated ALINUS tool.

When asked by audience members about the alignment of the Universal Standards with the OECD Guidelines on Multinational Enterprises (MNEs) and the UN Guiding Principles on Business and Human Rights and coordination with ISO and GIN, Foose explained that the SPTF works closely together with these organisations to ensure harmonisation to offer a common language. Greenberg added that the Universal Standards manual is aligned in language and concepts with the OECD Guidelines and UN Guiding Principles. However, as she explained, there is a need for both types of documents, as they serve complementary but different purposes: a) the guidelines present high-level principles whereas the Universal Standards define specific management practices to implement; and, b) the Universal Standards do not focus on general good business practices, but specifically on management practices that ensure client protection and strong social performance.