Key Terms for SHRM 2025-2026 Exam Preparation
Ableism - correct answer Discrimination and social prejudice against people with disabilities.
Accessibility - correct answer The design of products, devices, services, or environments to
make them accessible to people with disabilities.
Accountability - correct answer The responsibility of an individual or organization to account for
its activities and accept blame for failures or faults.
Active Candidates - correct answer Job seekers who are actively searching and applying for
jobs.
Affirmative Action - correct answer Policies that promote the employment of individuals who
have been historically excluded from certain sectors due to their race, ethnicity, or gender.
Age Discrimination in Employment Act (ADEA) - correct answer U.S. federal law that prohibits
employment discrimination against individuals age 40 and older.
Ageism - correct answer Prejudice or discrimination based on a person's age.
Agency Shop - correct answer A workplace where employees, even if not union members, must
pay union dues or fees.
Agile Management - correct answer A method of project management, typically used in
software development, that emphasizes flexibility, collaboration, and customer satisfaction.
Americans with Disabilities Act (ADA) - correct answer U.S. legislation that prohibits
discrimination against individuals with disabilities.
Applicant Pool - correct answer The total number of individuals who have applied for a
particular job opening.
Applicant Tracking System (ATS) - correct answer Software application that enables the
electronic handling of recruitment and hiring needs.
Arbitration - correct answer A process of dispute resolution in which a neutral third-party
makes a decision.
Artificial Intelligence (AI) - correct answer The simulation of human intelligence processes by
machines, especially computer systems.
At-Will Employment - correct answer A contract agreement that an employee can be dismissed
by an employer for any reason, and without warning.
Augmented Reality (AR) - correct answer A technology that overlays digital information on an
image of something being viewed through a device.
,Automation - correct answer The use of technology to perform tasks without human
intervention.
B Corporation - correct answer A type of for-profit corporate entity that includes positive
impact on society, workers, and the environment in addition to profit as its legally defined
goals.
Background Check - correct answer The process of looking up and compiling criminal,
commercial, and financial records of an individual.
Balance Sheet - correct answer A financial statement that reports a company's assets, liabilities,
and shareholders' equity at a specific point in time.
Balanced Scorecard - correct answer A performance metric used to identify, improve, and
control a business's various functions and resulting outcomes.
BAME (Black, Asian, and Minority Ethnic) - correct answer A term used in the UK to refer to
members of non-white communities.
Behavioral Assessment - correct answer A method used in the field of psychology to observe,
describe, explain, and predict behavior.
Behavioral Interview - correct answer A job interview technique where candidates are asked to
describe past behavior in specific situations.
Benchmarking - correct answer A process of measuring the performance of a company's
products, services, or processes against those of another business considered to be the best in
the industry.
Big Data - correct answer Extremely large data sets that may be analyzed computically to reveal
patterns, trends, and associations.
Biodiversity - correct answer The variety of life in the world or in a particular habitat or
ecosystem.
BIPOC (Black, Indigenous, People of Color) - correct answer An acronym that stands for Black,
Indigenous, and People of Color.
Black Swan Event - correct answer An unpredictable event that is beyond what is normally
expected of a situation and has potentially severe consequences.
Blockchain - correct answer A system in which a record of transactions made in bitcoin or
another cryptocurrency are maintained across several computers that are linked in a peer-to-
peer network.
Boolean Search - correct answer A type of search allowing users to combine keywords with
operators such as AND, NOT and OR to produce more relevant results.
,Brand Equity - correct answer The commercial value that derives from consumer perception of
the brand name of a particular product or service, rather than from the product or service itself.
Break-Even Point - correct answer The point at which total cost and total revenue are equal.
Business Continuity Management (BCM) - correct answer A framework for identifying an
organization's risk of exposure to internal and external threats.
Business Ethics - correct answer The study of appropriate business policies and practices
regarding potentially controversial subjects including corporate governance, insider trading,
bribery, discrimination, corporate social responsibility, and fiduciary responsibilities.
Business Impact Analysis (BIA) - correct answer A process that identifies and evaluates the
potential effects of an interruption to critical business operations as a result of a disaster,
accident or emergency.
Business Intelligence (BI) - correct answer The strategies and technologies used by enterprises
for the data analysis of business information.
Business Interruption Insurance - correct answer A type of insurance that covers the loss of
income that a business suffers after a disaster.
Business Process Outsourcing (BPO) - correct answer The practice of contracting a specific work
process or processes to an external service provider.
Business Strategy - correct answer A set of competitive moves and actions that a business uses
to attract customers, compete successfully, strengthening performance, and achieve
organisational goals.
Candidate Experience - correct answer How job seekers perceive and react to employers'
sourcing, recruiting, interviewing, hiring, and onboarding processes.
Candidate Pool - correct answer The group of job seekers who are actively seeking employment
with your organization.
Candidate Retention - correct answer The ability to engage and retain job candidates during the
recruitment process.
Candidate Shortlisting - correct answer The process of identifying the candidates from your
applicant pool who best meet the required and desired criteria for an open role, and who you
want to move forward onto the next step of your recruitment process.
Capital Expenditure (CAPEX) - correct answer Funds used by a company to acquire or upgrade
physical assets such as property, industrial buildings or equipment.
, Carbon Footprint - correct answer The total amount of greenhouse gases produced to directly
and indirectly support human activities, usually expressed in equivalent tons of carbon dioxide
(CO2).
Carbon Neutral - correct answer Achieving net zero carbon dioxide emissions by balancing
carbon emissions with carbon removal or simply eliminating carbon emissions altogether.
Carbon Offsetting - correct answer The act of reducing or removing the carbon dioxide
emissions that you are responsible for by paying others to remove or reduce them.
Carbon Tax - correct answer A levy imposed on the carbon content of fossil fuels to mitigate the
effects of greenhouse gas emissions.
Career Pathing - correct answer The process of mapping multiple possible career advancement
routes within an organization, often including the skills, knowledge and experiences required at
each step.
Career Site - correct answer A webpage or dedicated part of a company's website that displays
job openings and other career-related information.
Cash Flow - correct answer The net amount of cash and cash-equivalents being transferred into
and out of a business.
Cause Marketing - correct answer Marketing that ties a company and its products to an issue or
cause with the goal of improving sales and benefiting the cause.
Change Management - correct answer The systematic approach to dealing with change, both
from the perspective of an organization and on the individual level.
Child Labor - correct answer The exploitation of children through any form of work that
deprives them of their childhood, interferes with their ability to attend regular school, and is
mentally, physically, socially or morally harmful.
Circular Economy - correct answer An economic system aimed at eliminating waste and the
continual use of resources.
Cisgender - correct answer Referring to individuals whose gender identity aligns with the sex
they were assigned at birth.
Clean Technology - correct answer Products, services, or processes that use less energy, fewer
limited resources, create less waste and cause less environmental damage than their traditional
counterparts.
Climate Change - correct answer A long-term shift in global or regional climate patterns, often
seen today as a significant increase in average global temperatures.
Ableism - correct answer Discrimination and social prejudice against people with disabilities.
Accessibility - correct answer The design of products, devices, services, or environments to
make them accessible to people with disabilities.
Accountability - correct answer The responsibility of an individual or organization to account for
its activities and accept blame for failures or faults.
Active Candidates - correct answer Job seekers who are actively searching and applying for
jobs.
Affirmative Action - correct answer Policies that promote the employment of individuals who
have been historically excluded from certain sectors due to their race, ethnicity, or gender.
Age Discrimination in Employment Act (ADEA) - correct answer U.S. federal law that prohibits
employment discrimination against individuals age 40 and older.
Ageism - correct answer Prejudice or discrimination based on a person's age.
Agency Shop - correct answer A workplace where employees, even if not union members, must
pay union dues or fees.
Agile Management - correct answer A method of project management, typically used in
software development, that emphasizes flexibility, collaboration, and customer satisfaction.
Americans with Disabilities Act (ADA) - correct answer U.S. legislation that prohibits
discrimination against individuals with disabilities.
Applicant Pool - correct answer The total number of individuals who have applied for a
particular job opening.
Applicant Tracking System (ATS) - correct answer Software application that enables the
electronic handling of recruitment and hiring needs.
Arbitration - correct answer A process of dispute resolution in which a neutral third-party
makes a decision.
Artificial Intelligence (AI) - correct answer The simulation of human intelligence processes by
machines, especially computer systems.
At-Will Employment - correct answer A contract agreement that an employee can be dismissed
by an employer for any reason, and without warning.
Augmented Reality (AR) - correct answer A technology that overlays digital information on an
image of something being viewed through a device.
,Automation - correct answer The use of technology to perform tasks without human
intervention.
B Corporation - correct answer A type of for-profit corporate entity that includes positive
impact on society, workers, and the environment in addition to profit as its legally defined
goals.
Background Check - correct answer The process of looking up and compiling criminal,
commercial, and financial records of an individual.
Balance Sheet - correct answer A financial statement that reports a company's assets, liabilities,
and shareholders' equity at a specific point in time.
Balanced Scorecard - correct answer A performance metric used to identify, improve, and
control a business's various functions and resulting outcomes.
BAME (Black, Asian, and Minority Ethnic) - correct answer A term used in the UK to refer to
members of non-white communities.
Behavioral Assessment - correct answer A method used in the field of psychology to observe,
describe, explain, and predict behavior.
Behavioral Interview - correct answer A job interview technique where candidates are asked to
describe past behavior in specific situations.
Benchmarking - correct answer A process of measuring the performance of a company's
products, services, or processes against those of another business considered to be the best in
the industry.
Big Data - correct answer Extremely large data sets that may be analyzed computically to reveal
patterns, trends, and associations.
Biodiversity - correct answer The variety of life in the world or in a particular habitat or
ecosystem.
BIPOC (Black, Indigenous, People of Color) - correct answer An acronym that stands for Black,
Indigenous, and People of Color.
Black Swan Event - correct answer An unpredictable event that is beyond what is normally
expected of a situation and has potentially severe consequences.
Blockchain - correct answer A system in which a record of transactions made in bitcoin or
another cryptocurrency are maintained across several computers that are linked in a peer-to-
peer network.
Boolean Search - correct answer A type of search allowing users to combine keywords with
operators such as AND, NOT and OR to produce more relevant results.
,Brand Equity - correct answer The commercial value that derives from consumer perception of
the brand name of a particular product or service, rather than from the product or service itself.
Break-Even Point - correct answer The point at which total cost and total revenue are equal.
Business Continuity Management (BCM) - correct answer A framework for identifying an
organization's risk of exposure to internal and external threats.
Business Ethics - correct answer The study of appropriate business policies and practices
regarding potentially controversial subjects including corporate governance, insider trading,
bribery, discrimination, corporate social responsibility, and fiduciary responsibilities.
Business Impact Analysis (BIA) - correct answer A process that identifies and evaluates the
potential effects of an interruption to critical business operations as a result of a disaster,
accident or emergency.
Business Intelligence (BI) - correct answer The strategies and technologies used by enterprises
for the data analysis of business information.
Business Interruption Insurance - correct answer A type of insurance that covers the loss of
income that a business suffers after a disaster.
Business Process Outsourcing (BPO) - correct answer The practice of contracting a specific work
process or processes to an external service provider.
Business Strategy - correct answer A set of competitive moves and actions that a business uses
to attract customers, compete successfully, strengthening performance, and achieve
organisational goals.
Candidate Experience - correct answer How job seekers perceive and react to employers'
sourcing, recruiting, interviewing, hiring, and onboarding processes.
Candidate Pool - correct answer The group of job seekers who are actively seeking employment
with your organization.
Candidate Retention - correct answer The ability to engage and retain job candidates during the
recruitment process.
Candidate Shortlisting - correct answer The process of identifying the candidates from your
applicant pool who best meet the required and desired criteria for an open role, and who you
want to move forward onto the next step of your recruitment process.
Capital Expenditure (CAPEX) - correct answer Funds used by a company to acquire or upgrade
physical assets such as property, industrial buildings or equipment.
, Carbon Footprint - correct answer The total amount of greenhouse gases produced to directly
and indirectly support human activities, usually expressed in equivalent tons of carbon dioxide
(CO2).
Carbon Neutral - correct answer Achieving net zero carbon dioxide emissions by balancing
carbon emissions with carbon removal or simply eliminating carbon emissions altogether.
Carbon Offsetting - correct answer The act of reducing or removing the carbon dioxide
emissions that you are responsible for by paying others to remove or reduce them.
Carbon Tax - correct answer A levy imposed on the carbon content of fossil fuels to mitigate the
effects of greenhouse gas emissions.
Career Pathing - correct answer The process of mapping multiple possible career advancement
routes within an organization, often including the skills, knowledge and experiences required at
each step.
Career Site - correct answer A webpage or dedicated part of a company's website that displays
job openings and other career-related information.
Cash Flow - correct answer The net amount of cash and cash-equivalents being transferred into
and out of a business.
Cause Marketing - correct answer Marketing that ties a company and its products to an issue or
cause with the goal of improving sales and benefiting the cause.
Change Management - correct answer The systematic approach to dealing with change, both
from the perspective of an organization and on the individual level.
Child Labor - correct answer The exploitation of children through any form of work that
deprives them of their childhood, interferes with their ability to attend regular school, and is
mentally, physically, socially or morally harmful.
Circular Economy - correct answer An economic system aimed at eliminating waste and the
continual use of resources.
Cisgender - correct answer Referring to individuals whose gender identity aligns with the sex
they were assigned at birth.
Clean Technology - correct answer Products, services, or processes that use less energy, fewer
limited resources, create less waste and cause less environmental damage than their traditional
counterparts.
Climate Change - correct answer A long-term shift in global or regional climate patterns, often
seen today as a significant increase in average global temperatures.
