ESG PRACTICE EXAM QUESTIONS AND
DETAILED SOLUTIONS 2026
▶ 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.
▶ What is the Sustainability Advantage? Answer: The competitive edge
gained by companies that effectively integrate sustainability into their
business practices.
▶ What are some ESG trends to watch in 2026? Answer: Emerging
regulations, increased stakeholder engagement, and advancements in
sustainable technologies.
▶ What does adaptation refer to in the context of climate change? Answer:
Changes in processes, practices, and structures to moderate potential
damages or benefit from opportunities associated with climate change.
, ▶ What is mitigation in relation to climate change? Answer: A human
intervention to reduce emissions or enhance the sinks of greenhouse
gases (GHGs).
▶ What is the Mitigation Hierarchy? Answer: A series of steps for corporate
climate action: 1) AVOID, 2) REDUCE, and 3) OFFSET.
▶ What does the term 'Scope' refer to in GHG accounting? Answer: The
classification of an organization's GHG emissions according to the GHG
Protocol Corporate Standard.
▶ What are Scope 1 Emissions? Answer: Direct GHG emissions from
operations owned or controlled by the reporting company.
▶ What are Scope 2 Emissions? Answer: Indirect GHG emissions
associated with the generation of purchased or acquired electricity, steam,
heating, or cooling consumed by the reporting company.
▶ What are Scope 3 Emissions? Answer: Indirect GHG emissions that
occur in the value chain of the reporting company, including both upstream
and downstream emissions.
▶ What has driven the evolution of the ESG movement? Answer: A shift
from pre to post-industrial revolution focusing on environmental, social, and
governance factors.
▶ What role do Indigenous Peoples play in conservation? Answer: They
are custodians of unique knowledge and practices that emphasize the
balance between humans and the natural world.
▶ What is a major criticism of Western conservation models? Answer:
They have treated Indigenous Peoples as threats to biodiversity rather than
recognizing their role in protecting it.
▶ What is the significance of collaboration in modern conservation efforts?
Answer: It emphasizes ethical engagement and participatory research,
moving away from extractive practices.
DETAILED SOLUTIONS 2026
▶ 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.
▶ What is the Sustainability Advantage? Answer: The competitive edge
gained by companies that effectively integrate sustainability into their
business practices.
▶ What are some ESG trends to watch in 2026? Answer: Emerging
regulations, increased stakeholder engagement, and advancements in
sustainable technologies.
▶ What does adaptation refer to in the context of climate change? Answer:
Changes in processes, practices, and structures to moderate potential
damages or benefit from opportunities associated with climate change.
, ▶ What is mitigation in relation to climate change? Answer: A human
intervention to reduce emissions or enhance the sinks of greenhouse
gases (GHGs).
▶ What is the Mitigation Hierarchy? Answer: A series of steps for corporate
climate action: 1) AVOID, 2) REDUCE, and 3) OFFSET.
▶ What does the term 'Scope' refer to in GHG accounting? Answer: The
classification of an organization's GHG emissions according to the GHG
Protocol Corporate Standard.
▶ What are Scope 1 Emissions? Answer: Direct GHG emissions from
operations owned or controlled by the reporting company.
▶ What are Scope 2 Emissions? Answer: Indirect GHG emissions
associated with the generation of purchased or acquired electricity, steam,
heating, or cooling consumed by the reporting company.
▶ What are Scope 3 Emissions? Answer: Indirect GHG emissions that
occur in the value chain of the reporting company, including both upstream
and downstream emissions.
▶ What has driven the evolution of the ESG movement? Answer: A shift
from pre to post-industrial revolution focusing on environmental, social, and
governance factors.
▶ What role do Indigenous Peoples play in conservation? Answer: They
are custodians of unique knowledge and practices that emphasize the
balance between humans and the natural world.
▶ What is a major criticism of Western conservation models? Answer:
They have treated Indigenous Peoples as threats to biodiversity rather than
recognizing their role in protecting it.
▶ What is the significance of collaboration in modern conservation efforts?
Answer: It emphasizes ethical engagement and participatory research,
moving away from extractive practices.
