Navigating the updated SPS 515: Elevating member outcomes beyond compliance 

With the introduction of SPS 515 on 1 January 2020, APRA required superannuation trustees to embed member outcomes requirements as a core part of their strategic planning and decision-making processes. However, many trustees still view these requirements as a compliance function. The updated SPS 515 enhances the intersection of compliance and strategy. APRA describes the updates as setting a clear expectation for trustees to prioritise members’ best financial interests in all decisions and fund operations.

While some aspects of SPS 515 remain unchanged, including the overall format of the Annual Outcomes Assessment (AOA) and BPR, trustees should review the updated SPS 515 and ensure compliance by 1 July 2025. This is an opportunity to enhance business planning processes for improved member outcomes.

If not already done, trustees should:

• Conduct a comprehensive gap analysis to identify compliance needs related to the new standard and guidance.
• Assess whether expenditure management frameworks have well-defined processes, including controls and governance delegations, to monitor whether expenditure meets expected outcomes. The framework needs to demonstrate that expenditure contributes to strategic objectives in an objective and measurable way (e.g. the impact of advertising spend).
• Incorporate RIS outcomes into the BPR, using specific and measurable quantitative and qualitative metrics. APRA expects trustees to measure improvements in member retirement income outcomes resulting from the RIS. Many trustees have begun defining these metrics and building RIS scorecards over the past year. A triennial review of the RIS should be conducted by someone operationally independent.
• Holistically assess financial capital management and reserving policies, considering changes to incorporate the updated broader requirements.
• Continuously enhance member cohorting processes by acquiring relevant member data, applying public data overlays, and improving data analytics capabilities.
• Review the financial projections underpinning the strategic business plan, ensuring they cover various potential scenarios over the plan’s term.
• Update the member outcomes policy if one was created when SPS 515 was first introduced.

Collaboration across all business units is essential to meet these new requirements effectively. By working together, your fund will not only comply with SPS 515 but also enhance the value delivered to your members.

Contact us today to discover how Mercer’s experts can transform your approach to SPS 515, turning compliance into a strategic advantage that enhances member outcomes and drives organisational success.

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