CFA ESG Certification Exam Newest 2025/2026
Complete All 150 Questions And Correct Detailed
Answers (Verified Answers) |Already Graded
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What is ESG investing?
a) an approach to managing companies that explicitly acknowledges the relevance of
environmental, social, and governance factors in corporate decision making
b) an approach to managing companies that explicitly acknowledges the relevance of
environmental, social, and economic factors in investment decision making
c) an approach to managing assets where investors explicitly acknowledge the
relevance of environmental, social, and governance factors in their investment decisions
d) an approach to managing assets where investors explicitly acknowledge the
relevance of environmental, social, and economic factors in corporate engagement -
✔✔ANSW✔✔c
Which of the following is not an example of a social factor?
a) Labor rights
b) Local communities
c) Product safety
d) Biodiversity - ✔✔ANSW✔✔d
In what sense are ESG considerations non-financial?
a) They are difficult to value precisely and difficult to time
b) They are issues that will never turn into financials
c) They sit in a different category of performance
d) They can only every be measured qualitatively - ✔✔ANSW✔✔a
For which of the following sectors will the management of greenhouse gas emissions be
most material?
a) Software
b) Recruitment
c) Power generation
d) Fund management - ✔✔ANSW✔✔c
Which of the following is not a typical method by which ESG is reflected in investment
approaches?
a) Integrating ESG into investment decision making
b) Engaging actively with companies on ESG matters
c) Engaging in public policy debates on ESG issues
,d) Disclosing the investor's corporate social responsibility activities - ✔✔ANSW✔✔d
Which of the following is not a form of ESG investment?
a) Valuation investment
b) Ethical investment
c) Thematic investment
d) Impact investment - ✔✔ANSW✔✔a
What are the four broad groupings of issues covered by the UN Global Compact?
a) Environmental, social, governance, and impact
b) Human rights, labor, environment, and anti corruption
c) Poverty, diversity, sustainability, and transparency
d) Education, development, fairness, independence - ✔✔ANSW✔✔b
What is not one of the three P's in the triple bottom line concept?
a) People
b) Planet
c) Profit
d) Principle - ✔✔ANSW✔✔d
Which of the following statements is true about best-in-class investments?
a) It involves selecting only the companies that overcome a defined ranking hurdle
b) It cannot be used to maintain key characteristics, such as regional and sectoral
diversification of an index
c) It refers to selecting companies that fall under a sustainability-related theme
d) It refers to allocating capital to assets that best mitigate climate change -
✔✔ANSW✔✔a
Which of the following sectors is NOT typically excluded by ethical and faith-based
investors?
a) Tobacco
b) Alcohol
c) Controversial weapons
d) Technology - ✔✔ANSW✔✔d
The efficiency of shareholder engagement does NOT depend on...
a) the scale of ownership of the individual investor or the collective initiative
b) the quality of the engagement dialogue and method used
c) whether divestment is known to be a possible sanction
d) the amount of security in free float - ✔✔ANSW✔✔d
In which ways can ESG matters become financially material for a company, and
contribute to reduced risk and enhanced return?
a) Increased cost and reduced efficiency
b) Increased externality
, c) Increased risk of fines
d) Increased adaptability to sustainable megatrends - ✔✔ANSW✔✔d
What kinds of situations does the term 'negative externality' best describe?
a) Situations where the production of goods induces costs to others that are not
reflected in the prices charged for them
b) Situations where the consumption of services induces benefits to others that are not
reflected in the prices charged for them
c) Situations 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
d) Situations where the production or consumption of a product or service's private price
equilibrium cannot reflect the true benefits of that product or service for society as a
whole - ✔✔ANSW✔✔c
According to Oxfam, "reports show that the richest 1% in the world have more than
double the wealth of 6.9 billion people." Which megatrend does this refer to?
a) Emerging and urban
b) Technological disruption
c) Demographic changes and wealth inequality
d) Climate change and resource scarcity - ✔✔ANSW✔✔c
What is the most probable reason why an investor would engage with policy makers on
ESG?
a) The consideration of ESG related matters can contribute to the proper functioning of
the financial markets
b) Asset owners need regulators to level the playing field in order to be able to increase
their percentage of ESG investments
c) Policy consultations on ESG investing are mandatory in order to ensure that all
perspectives are taken into consideration
d) ESG investors require a sound and stable financial system in order to make alpha
from ESG megatrends - ✔✔ANSW✔✔a
Which regions manage the highest proportion of sustainable and responsible investing
assets?
a) Asia and North America
b) Australia and USA
c) USA and Europe
d) Asia and Europe - ✔✔ANSW✔✔c
What is the largest sustainable investment strategy globally?
a) Impact investing
b) Best in class
c) ESG integration
d) Negative screening - ✔✔ANSW✔✔d
Complete All 150 Questions And Correct Detailed
Answers (Verified Answers) |Already Graded
A+||Brand New Version!!
What is ESG investing?
a) an approach to managing companies that explicitly acknowledges the relevance of
environmental, social, and governance factors in corporate decision making
b) an approach to managing companies that explicitly acknowledges the relevance of
environmental, social, and economic factors in investment decision making
c) an approach to managing assets where investors explicitly acknowledge the
relevance of environmental, social, and governance factors in their investment decisions
d) an approach to managing assets where investors explicitly acknowledge the
relevance of environmental, social, and economic factors in corporate engagement -
✔✔ANSW✔✔c
Which of the following is not an example of a social factor?
a) Labor rights
b) Local communities
c) Product safety
d) Biodiversity - ✔✔ANSW✔✔d
In what sense are ESG considerations non-financial?
a) They are difficult to value precisely and difficult to time
b) They are issues that will never turn into financials
c) They sit in a different category of performance
d) They can only every be measured qualitatively - ✔✔ANSW✔✔a
For which of the following sectors will the management of greenhouse gas emissions be
most material?
a) Software
b) Recruitment
c) Power generation
d) Fund management - ✔✔ANSW✔✔c
Which of the following is not a typical method by which ESG is reflected in investment
approaches?
a) Integrating ESG into investment decision making
b) Engaging actively with companies on ESG matters
c) Engaging in public policy debates on ESG issues
,d) Disclosing the investor's corporate social responsibility activities - ✔✔ANSW✔✔d
Which of the following is not a form of ESG investment?
a) Valuation investment
b) Ethical investment
c) Thematic investment
d) Impact investment - ✔✔ANSW✔✔a
What are the four broad groupings of issues covered by the UN Global Compact?
a) Environmental, social, governance, and impact
b) Human rights, labor, environment, and anti corruption
c) Poverty, diversity, sustainability, and transparency
d) Education, development, fairness, independence - ✔✔ANSW✔✔b
What is not one of the three P's in the triple bottom line concept?
a) People
b) Planet
c) Profit
d) Principle - ✔✔ANSW✔✔d
Which of the following statements is true about best-in-class investments?
a) It involves selecting only the companies that overcome a defined ranking hurdle
b) It cannot be used to maintain key characteristics, such as regional and sectoral
diversification of an index
c) It refers to selecting companies that fall under a sustainability-related theme
d) It refers to allocating capital to assets that best mitigate climate change -
✔✔ANSW✔✔a
Which of the following sectors is NOT typically excluded by ethical and faith-based
investors?
a) Tobacco
b) Alcohol
c) Controversial weapons
d) Technology - ✔✔ANSW✔✔d
The efficiency of shareholder engagement does NOT depend on...
a) the scale of ownership of the individual investor or the collective initiative
b) the quality of the engagement dialogue and method used
c) whether divestment is known to be a possible sanction
d) the amount of security in free float - ✔✔ANSW✔✔d
In which ways can ESG matters become financially material for a company, and
contribute to reduced risk and enhanced return?
a) Increased cost and reduced efficiency
b) Increased externality
, c) Increased risk of fines
d) Increased adaptability to sustainable megatrends - ✔✔ANSW✔✔d
What kinds of situations does the term 'negative externality' best describe?
a) Situations where the production of goods induces costs to others that are not
reflected in the prices charged for them
b) Situations where the consumption of services induces benefits to others that are not
reflected in the prices charged for them
c) Situations 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
d) Situations where the production or consumption of a product or service's private price
equilibrium cannot reflect the true benefits of that product or service for society as a
whole - ✔✔ANSW✔✔c
According to Oxfam, "reports show that the richest 1% in the world have more than
double the wealth of 6.9 billion people." Which megatrend does this refer to?
a) Emerging and urban
b) Technological disruption
c) Demographic changes and wealth inequality
d) Climate change and resource scarcity - ✔✔ANSW✔✔c
What is the most probable reason why an investor would engage with policy makers on
ESG?
a) The consideration of ESG related matters can contribute to the proper functioning of
the financial markets
b) Asset owners need regulators to level the playing field in order to be able to increase
their percentage of ESG investments
c) Policy consultations on ESG investing are mandatory in order to ensure that all
perspectives are taken into consideration
d) ESG investors require a sound and stable financial system in order to make alpha
from ESG megatrends - ✔✔ANSW✔✔a
Which regions manage the highest proportion of sustainable and responsible investing
assets?
a) Asia and North America
b) Australia and USA
c) USA and Europe
d) Asia and Europe - ✔✔ANSW✔✔c
What is the largest sustainable investment strategy globally?
a) Impact investing
b) Best in class
c) ESG integration
d) Negative screening - ✔✔ANSW✔✔d
