ESG CERTIFICATION EXAM QUESTIONS
AND VERIFIED ANSWERS 2026
▶ What social factors are included in ESG assessments? Answer: Labour
practices, human rights, employee health and well-being, diversity, equity &
inclusion, impact on community and customers
▶ What governance aspects are evaluated in ESG? Answer: Management
processes, internal controls/audits, board oversight, executive pay,
shareholder rights, transparency
▶ How does ESG impact business risk management? Answer: It changes
how risks and opportunities are measured and managed.
▶ Why is ESG important for stakeholders? Answer: It allows companies to
show stakeholders that they are mitigating risks and planning for a
changing future.
▶ Is ESG relevant only for publicly-traded companies? Answer: No, ESG is
important for all companies, including mid-market companies.
▶ What is a Carbon Credit? Answer: A tradable unit that represents one
metric tonne of avoided GHG emissions, reduced GHG emissions, or GHG
removals.
▶ What is Greenwashing? Answer: The act of making false or misleading
statements about the environmental benefits of a product or practice.
▶ What does Carbon Neutral mean? Answer: Any CO2 released into the
atmosphere from a company's activities is balanced by an equivalent
amount being removed.
▶ What is meant by Net-Zero Carbon Emissions? Answer: Activity that
releases no carbon emissions into the atmosphere, often referred to as net-
zero.
, ▶ What is the Paris Agreement? Answer: An international treaty aimed at
reducing carbon emissions and combating climate change.
▶ What are Science Based Targets? Answer: Targets set by companies to
reduce greenhouse gas emissions in line with climate science.
▶ What does Decarbonization refer to? Answer: The process of reducing
carbon emissions associated with electricity, industry, and transport.
▶ What are Planetary Boundaries? Answer: Limits within which humanity
can safely operate to avoid catastrophic environmental change.
▶ What is meant by Negative Emissions? Answer: Removal of GHGs from
the atmosphere by deliberate human activities.
▶ What is meant by a Just Transition? Answer: An approach that ensures
the transition to a sustainable economy is fair and inclusive.
▶ What is Green Financing? Answer: Financial flows associated with zero-
or low-carbon assets or activities.
▶ What is Grey Financing? Answer: Financial flows toward activities and
technologies that contribute significantly to GHG emissions.
▶ What does Greenhushing refer to? Answer: The practice where
companies underreport or withhold information about their environmental
efforts.
▶ What is the role of Indigenous Knowledge in ESG? Answer: Indigenous
Knowledge can provide valuable insights and practices for sustainable
environmental management.
▶ What are the United Nations Sustainable Development Goals? Answer:
A collection of 17 global goals designed to be a 'blueprint to achieve a
better and more sustainable future for all.'
▶ What is Adaptation in the context of climate change? Answer:
Adjustments in ecological, social or economic systems in response to
actual or expected climatic stimuli and their effects.
AND VERIFIED ANSWERS 2026
▶ What social factors are included in ESG assessments? Answer: Labour
practices, human rights, employee health and well-being, diversity, equity &
inclusion, impact on community and customers
▶ What governance aspects are evaluated in ESG? Answer: Management
processes, internal controls/audits, board oversight, executive pay,
shareholder rights, transparency
▶ How does ESG impact business risk management? Answer: It changes
how risks and opportunities are measured and managed.
▶ Why is ESG important for stakeholders? Answer: It allows companies to
show stakeholders that they are mitigating risks and planning for a
changing future.
▶ Is ESG relevant only for publicly-traded companies? Answer: No, ESG is
important for all companies, including mid-market companies.
▶ What is a Carbon Credit? Answer: A tradable unit that represents one
metric tonne of avoided GHG emissions, reduced GHG emissions, or GHG
removals.
▶ What is Greenwashing? Answer: The act of making false or misleading
statements about the environmental benefits of a product or practice.
▶ What does Carbon Neutral mean? Answer: Any CO2 released into the
atmosphere from a company's activities is balanced by an equivalent
amount being removed.
▶ What is meant by Net-Zero Carbon Emissions? Answer: Activity that
releases no carbon emissions into the atmosphere, often referred to as net-
zero.
, ▶ What is the Paris Agreement? Answer: An international treaty aimed at
reducing carbon emissions and combating climate change.
▶ What are Science Based Targets? Answer: Targets set by companies to
reduce greenhouse gas emissions in line with climate science.
▶ What does Decarbonization refer to? Answer: The process of reducing
carbon emissions associated with electricity, industry, and transport.
▶ What are Planetary Boundaries? Answer: Limits within which humanity
can safely operate to avoid catastrophic environmental change.
▶ What is meant by Negative Emissions? Answer: Removal of GHGs from
the atmosphere by deliberate human activities.
▶ What is meant by a Just Transition? Answer: An approach that ensures
the transition to a sustainable economy is fair and inclusive.
▶ What is Green Financing? Answer: Financial flows associated with zero-
or low-carbon assets or activities.
▶ What is Grey Financing? Answer: Financial flows toward activities and
technologies that contribute significantly to GHG emissions.
▶ What does Greenhushing refer to? Answer: The practice where
companies underreport or withhold information about their environmental
efforts.
▶ What is the role of Indigenous Knowledge in ESG? Answer: Indigenous
Knowledge can provide valuable insights and practices for sustainable
environmental management.
▶ What are the United Nations Sustainable Development Goals? Answer:
A collection of 17 global goals designed to be a 'blueprint to achieve a
better and more sustainable future for all.'
▶ What is Adaptation in the context of climate change? Answer:
Adjustments in ecological, social or economic systems in response to
actual or expected climatic stimuli and their effects.
