Official CFA ESG Practice QAS 100%
Correct!!
Does conventional financial investing focus on enhancing the long-term value of an
investment portfolio? - ANSWERSNo, conventional financial investing is ST. Only ESG
investing focusses on the LT.
What are the "core planetary boundaries" identified by the Stockholm Resilience
Centre? - ANSWERSBiosphere integrity and climate change
ESG integration can have a material financial impact on a company, resulting in what? -
ANSWERSESG investing can reduce risk and enhance returns
The ESG reporting framework used by the United Nations Global Compact signatories
is published by whom? - ANSWERSGlobal Reporting Initiative (GRI).
What situation does a 'negative externality' describe? - ANSWERSSituations where the
production or consumption of a product or service's private price equilibrium cannot
reflect the true costs of that product or service for society as a whole
Is engaging in public policy debates on ESG issues a typical method by which ESG
factors are reflected in investment approaches? - ANSWERSYes it is
Would disclosing the investor's corporate social responsibility activities be a typical
method by which ESG factors are reflected in investment approaches? - ANSWERSNo
it would not
What are the four broad groupings of issues covered by the UN Global Compact? -
ANSWERSHuman rights, labor, environment, and anti-corruption
What was the Shareholder Rights Directive (SRD) role? - ANSWERSThe SRD was
issued by the EU and requires investors to be active owners and to act with a more
long-term focus.
Which two reports formed the backbone for the launch of the Principles for Responsible
Investment (PRI) in 2006? - ANSWERSFreshfields Report and 'Who Cares Wins' report
Which regions manage the highest proportion of sustainable and responsible
investment assets? - ANSWERSCanada and Europe
Why are investment mandates important for ESG investing? - ANSWERSThey are
contracts that define the requirements of the asset manager with regard to ESG issues.
, What is the main challenge with policies that are "comply or explain" regarding ESG
issues? - ANSWERSIt leads to investors challenging the assertion that ESG integration
is a requirement.
Which matters do the EU Taxonomy address? - ANSWERSGreen bonds and low-
carbon benchmarks
What is the key aim of the international Paris Agreement on climate change? -
ANSWERSTo pursue efforts to limit the temperature increase to 2°C (3.6°F) above pre-
industrial levels by the end of the century.
How often are Paris agreement signatories required to update on their commitments? -
ANSWERSEvery 5 years
The first international convention to set targets for emissions of the main greenhouse
gases was the what? - ANSWERSKyoto Protocol
In relation to the European Green Deal, the "green supporting factor" refers to what? -
ANSWERSThe treatment of "green" assets in the capital requirements of banks and
insurers.
Which country has the highest level of investments in the low carbon energy transition?
- ANSWERSChina
What do the Helsinki principles do? - ANSWERSEncourage signatories to "take climate
change into account in macroeconomic policy, fiscal planning, budgeting, public
investment management, and procurement practices."
What does the Network for Greening the Financial System (NGFS) comprise? -
ANSWERSOver 70 Central Banks and financial supervisors
What is internal / shadow carbon pricing? - ANSWERSAn internal or shadow price on
carbon creates a theoretical or assumed cost per tonne of carbon emissions. This is
used to better understand the potential impact of future climate regulation on the
profitability of a project, a new business model, or an investment.
Protecting coastlines from erosion is an example of what? - ANSWERSClimate change
adaptation
Does policy change to encourage low-carbon economies represent a transition risk? -
ANSWERSYes it does
What would traditional occupational health focus on? - ANSWERSLimit employee
exposure to conditions that lead to occupational diseases.
Correct!!
Does conventional financial investing focus on enhancing the long-term value of an
investment portfolio? - ANSWERSNo, conventional financial investing is ST. Only ESG
investing focusses on the LT.
What are the "core planetary boundaries" identified by the Stockholm Resilience
Centre? - ANSWERSBiosphere integrity and climate change
ESG integration can have a material financial impact on a company, resulting in what? -
ANSWERSESG investing can reduce risk and enhance returns
The ESG reporting framework used by the United Nations Global Compact signatories
is published by whom? - ANSWERSGlobal Reporting Initiative (GRI).
What situation does a 'negative externality' describe? - ANSWERSSituations where the
production or consumption of a product or service's private price equilibrium cannot
reflect the true costs of that product or service for society as a whole
Is engaging in public policy debates on ESG issues a typical method by which ESG
factors are reflected in investment approaches? - ANSWERSYes it is
Would disclosing the investor's corporate social responsibility activities be a typical
method by which ESG factors are reflected in investment approaches? - ANSWERSNo
it would not
What are the four broad groupings of issues covered by the UN Global Compact? -
ANSWERSHuman rights, labor, environment, and anti-corruption
What was the Shareholder Rights Directive (SRD) role? - ANSWERSThe SRD was
issued by the EU and requires investors to be active owners and to act with a more
long-term focus.
Which two reports formed the backbone for the launch of the Principles for Responsible
Investment (PRI) in 2006? - ANSWERSFreshfields Report and 'Who Cares Wins' report
Which regions manage the highest proportion of sustainable and responsible
investment assets? - ANSWERSCanada and Europe
Why are investment mandates important for ESG investing? - ANSWERSThey are
contracts that define the requirements of the asset manager with regard to ESG issues.
, What is the main challenge with policies that are "comply or explain" regarding ESG
issues? - ANSWERSIt leads to investors challenging the assertion that ESG integration
is a requirement.
Which matters do the EU Taxonomy address? - ANSWERSGreen bonds and low-
carbon benchmarks
What is the key aim of the international Paris Agreement on climate change? -
ANSWERSTo pursue efforts to limit the temperature increase to 2°C (3.6°F) above pre-
industrial levels by the end of the century.
How often are Paris agreement signatories required to update on their commitments? -
ANSWERSEvery 5 years
The first international convention to set targets for emissions of the main greenhouse
gases was the what? - ANSWERSKyoto Protocol
In relation to the European Green Deal, the "green supporting factor" refers to what? -
ANSWERSThe treatment of "green" assets in the capital requirements of banks and
insurers.
Which country has the highest level of investments in the low carbon energy transition?
- ANSWERSChina
What do the Helsinki principles do? - ANSWERSEncourage signatories to "take climate
change into account in macroeconomic policy, fiscal planning, budgeting, public
investment management, and procurement practices."
What does the Network for Greening the Financial System (NGFS) comprise? -
ANSWERSOver 70 Central Banks and financial supervisors
What is internal / shadow carbon pricing? - ANSWERSAn internal or shadow price on
carbon creates a theoretical or assumed cost per tonne of carbon emissions. This is
used to better understand the potential impact of future climate regulation on the
profitability of a project, a new business model, or an investment.
Protecting coastlines from erosion is an example of what? - ANSWERSClimate change
adaptation
Does policy change to encourage low-carbon economies represent a transition risk? -
ANSWERSYes it does
What would traditional occupational health focus on? - ANSWERSLimit employee
exposure to conditions that lead to occupational diseases.
