Criterion: a standard of judging or making a decision; any established law, rule, principle or fact by which correct judgment may be formed.  A model or test. 

We also speak of meeting the criterion, as in “She met the criterion for the position and we hired her.”

If, on the other hand, you ‘set the criterion’ you are establishing a new standard.  Some politicians set the criterion so low, I wonder sometimes if anyone couldn’t become one. 

Criterion comes from the Greek word krites (κριτής).  Krites means judge.  From krites, English also derives the words critic and critical.

Synonyms: gauge, model, standard, test, benchmark, guide, measure