CFA ESG Chapter 4 Exam Questions & Answers Correct 100%

Long-term social changes impact... - Answer governments, societies and economics, permanently over a long period of time. Can environmental trends have a social impact? - Answer Yes, environmental trends can have a severe social impact as well. In terms of social impact, give an example of one that happens because of global warming - Answer If we get global warming, we will see migration like we have never seen before from the places most effected. E.g., climate change impacting the bottom 2/3rds of the population. What is the most important step when incorporating social factors in investment decision making? - Answer Focus on the most controversial/ financially material. Remember, this book is on investment decisions, so your starting point is to focus on the most controversial / financially material. What was the impact of COVID-19 on companies in terms of "reshoring"? - Answer Due to supply chain impacts, many companies reduced their supply chain risk by relocating production of strategic importance back to high-wage countries. How would you go about incorporating social factors into the investment process? - Answer 1. Determine which social factors are most controversial or financially material in each industry. 2. Assess how exposed certain companies are to these sector and country specific issues. 3. Assess critical social issues in their supply chain. Name the four social factors that impact internal stakeholders. - Answer 1. Human capital development 2. Working conditions, health & safety 3. Human rights 4. Employment standards and labour rights Name the four external social factors that impact stakeholders. - Answer 1. Stakeholder opposition and controversial sourcing. 2. Product liability and consumer protection. 3. Social opportunities. 4. Animal welfare.