CFA /
ESG Exam Questions With Correct Answers
/ // // // // //
Spectrum //of //Capital
Impact //Investment
- //investments //made //with //the //specific //intent //of //generating //positive, //measurable //social
and/or /
/environmental /
/impact //alongside //a //financial //return //(which //differentiates //it //from //philanthropy)
- //historically //through //direct //investments //(private //equity, //real //estate)
UN //Global //Compact //(UNGC)
- //was //launched //in //2000 //as //a //collaboration //between //leading //corporations //& //the //UN //(>8k
//signatories)
- //signatories //agreed //to //adhere //to //10 //principles
UN //Environment //Program //Finance //Initiative //(UNEP //FI)
- //started //in //1992, //over //300 //members
- //partnership //w/ //global //financial //sector
- //goal //is //to //mobilize //private //sector //finance //for //sustainable //development
-/
/established: /
/Principles /
/for /
/Responsible /
/Investment /
/(PRI), //Principles //for //Sustainable //Insurance //(PSI), //Principles //for //Responsible //Banking //(PRB)
PRI //Member //Requirements
- //annual //report //on //responsible //investment //practices //&
(1) //firm //needs //to //have //a //responsible //investment //policy //that //covers //> //50% //firm //AUM
(2) //someone //is //responsible //for //implementing //the //policy
(3) //senior-level //commitment //for //implementation
,Kyoto //Protocol
- //determined //by //UN //Framework //Convention //on //Climate //Change //(UNFCCC)
-/
/commits /
/industrialized //countries //to //limit //GHG //emissions //in //accordance //with //individual //targets
Paris //Agreement
- //determined //by //UN //Framework //Convention //on //Climate //Change //(UNFCCC)
- //commits //to //limiting //annual //global //temperature //rise //to //2 //degrees //C //(3.6 //F)
Value //Reporting //Foundation //(VRF)
-/
/was /
/formed /
/upon /
/the /
/merger /
/of /
/the /
/International /
/Integrated /
/Reporting //Council //(IIRC) //and //the //Sustainability //Accounting //Standards //Board //(SASB)
EU's //Sustainable //Finance //Disclosure //Regulation //(SFDR)
- //went //into //force //March //2021
- //goal //is //to //standardize //sustainability //disclosures
- //applies //to //advisors //and //market //participants //who //create //financial //products //in //the //EEA
- //requires //disclosure //at //the //company //and //product //level
Financial //Stability //Board //Task //Force //on //Climate-related //Financial //Disclosures //(TCFD)
- //tries //to //apply //the //Paris //Agreement //to //the //business //world
-/
/drives /
/an //advance //in //disclosures //by //seeking //transparency //about //realistic //scenario //planning,
particularly //around //the //physical //impacts //of //climate //change
, 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.
(d) //Disclosing //the //investor's //corporate //social //responsibility //activities.
What //are //the //four //broad //groupings //of //issues //covered //by //the //UN //Global //Compact?
(a) //Environmental, //social, //governance //and //impact.
(b) //Human //rights, //labour, //environment //and //anti-corruption.
(c) //Poverty, //diversity, //sustainability //and //transparency.
(d) //Education, //development, //fairness //and //independence.
(b) //Human //rights, //labour, //environment //and //anti-corruption.
How //are //pension //fund //members //most //likely //to //influence //responsible //investment?
(a) //Their //formal //investment //advice //to //pension //fund //executives //must //be //implemented
(b) /
/They //monitor //company //controversy //through //social //media //and //inform //asset //managers.
(c) //They //act //in //the //interest //of //sustainable //companies
(d) //Their //ethical //preferences //may //be //taken //into //account.
(d) //Their //ethical //preferences //may //be //taken //into //account.
Which //matters //does //the //EU //taxonomy //address?
(a) //Green //bonds //and //engagement.
(b) //Green //bonds //and //low-carbon //benchmarks.
(c) //Carbon //disclosure //and //long-termism.
(d) //Climate //risk //and //fiduciary //duty.
(b) //Green //bonds //and //low-carbon //benchmarks.
We //have //an //expert-written //solution //to //this //problem!
ESG Exam Questions With Correct Answers
/ // // // // //
Spectrum //of //Capital
Impact //Investment
- //investments //made //with //the //specific //intent //of //generating //positive, //measurable //social
and/or /
/environmental /
/impact //alongside //a //financial //return //(which //differentiates //it //from //philanthropy)
- //historically //through //direct //investments //(private //equity, //real //estate)
UN //Global //Compact //(UNGC)
- //was //launched //in //2000 //as //a //collaboration //between //leading //corporations //& //the //UN //(>8k
//signatories)
- //signatories //agreed //to //adhere //to //10 //principles
UN //Environment //Program //Finance //Initiative //(UNEP //FI)
- //started //in //1992, //over //300 //members
- //partnership //w/ //global //financial //sector
- //goal //is //to //mobilize //private //sector //finance //for //sustainable //development
-/
/established: /
/Principles /
/for /
/Responsible /
/Investment /
/(PRI), //Principles //for //Sustainable //Insurance //(PSI), //Principles //for //Responsible //Banking //(PRB)
PRI //Member //Requirements
- //annual //report //on //responsible //investment //practices //&
(1) //firm //needs //to //have //a //responsible //investment //policy //that //covers //> //50% //firm //AUM
(2) //someone //is //responsible //for //implementing //the //policy
(3) //senior-level //commitment //for //implementation
,Kyoto //Protocol
- //determined //by //UN //Framework //Convention //on //Climate //Change //(UNFCCC)
-/
/commits /
/industrialized //countries //to //limit //GHG //emissions //in //accordance //with //individual //targets
Paris //Agreement
- //determined //by //UN //Framework //Convention //on //Climate //Change //(UNFCCC)
- //commits //to //limiting //annual //global //temperature //rise //to //2 //degrees //C //(3.6 //F)
Value //Reporting //Foundation //(VRF)
-/
/was /
/formed /
/upon /
/the /
/merger /
/of /
/the /
/International /
/Integrated /
/Reporting //Council //(IIRC) //and //the //Sustainability //Accounting //Standards //Board //(SASB)
EU's //Sustainable //Finance //Disclosure //Regulation //(SFDR)
- //went //into //force //March //2021
- //goal //is //to //standardize //sustainability //disclosures
- //applies //to //advisors //and //market //participants //who //create //financial //products //in //the //EEA
- //requires //disclosure //at //the //company //and //product //level
Financial //Stability //Board //Task //Force //on //Climate-related //Financial //Disclosures //(TCFD)
- //tries //to //apply //the //Paris //Agreement //to //the //business //world
-/
/drives /
/an //advance //in //disclosures //by //seeking //transparency //about //realistic //scenario //planning,
particularly //around //the //physical //impacts //of //climate //change
, 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.
(d) //Disclosing //the //investor's //corporate //social //responsibility //activities.
What //are //the //four //broad //groupings //of //issues //covered //by //the //UN //Global //Compact?
(a) //Environmental, //social, //governance //and //impact.
(b) //Human //rights, //labour, //environment //and //anti-corruption.
(c) //Poverty, //diversity, //sustainability //and //transparency.
(d) //Education, //development, //fairness //and //independence.
(b) //Human //rights, //labour, //environment //and //anti-corruption.
How //are //pension //fund //members //most //likely //to //influence //responsible //investment?
(a) //Their //formal //investment //advice //to //pension //fund //executives //must //be //implemented
(b) /
/They //monitor //company //controversy //through //social //media //and //inform //asset //managers.
(c) //They //act //in //the //interest //of //sustainable //companies
(d) //Their //ethical //preferences //may //be //taken //into //account.
(d) //Their //ethical //preferences //may //be //taken //into //account.
Which //matters //does //the //EU //taxonomy //address?
(a) //Green //bonds //and //engagement.
(b) //Green //bonds //and //low-carbon //benchmarks.
(c) //Carbon //disclosure //and //long-termism.
(d) //Climate //risk //and //fiduciary //duty.
(b) //Green //bonds //and //low-carbon //benchmarks.
We //have //an //expert-written //solution //to //this //problem!
