CFA Institute ESG Investing Dumps (V8.02) – Allowing You to Confidently Prepare for the Certificate in ESG Investing Certification Exam

1. Which of the following sectors has the highest percentage of corporate profits at risk from state intervention?

2. Scores used to construct ESG index benchmarks can be

3. When undertaking an ESG assessment of a private equity deal ESG screening and due diligence will most likely take place during:

4. Which of the following statements about corporate governance is most accurate? Companies with a more diverse board of directors are most likely associated with

5. Which of the following greenhouse gases (GHGs) has the longest lifetime in the atmosphere?

6. Human rights violations are most likely to affect workers employed

7. What is the underlying principle of the corporate governance code in most markets?

8. Which of the following is an example of a bottom-up ESG engagement approach? An asset manager:

9. The concept of double-agency in society refers to the conflict of interest between

10. In France, shareholders eligible for being awarded double voting rights are

11. Which of the following asset classes has the lowest degree of ESG integration?

12. A company reduces water usage and increases usage of more expensive resources after regulations become more stringent. This most likely impacts:

13. Under the disclosure guide for public equities published by the Pension and Lifetime Savings Association (PLSA). fund managers are expected to report on:

14. A challenge to ESG integration at the asset allocation level when using mean-variance optimization is that it:

15. Over the past several years, the proportion of sustainable investing relative to total managed assets has fallen in:

16. Which of the following is a form of individual engagement?

17. According to the UK Investor Forum which of the following is a key success factor for effective engagement?

18. The triple bottom line accounting theory considers people, profit, and:

19. With respect to ESG integration, adjusting financial model inputs based on an evaluation of a company’s ESG risk factors is an example of a:

20. Which of the following is an example of a just’ transition with regards to climate change?

21. The Integrated Biodiversity Assessment Tool (IBAT) is best described as an interactive mapping tool allowing decisionmakers to:

22. The divergence of ratings among ESG providers most likely.

23. Regrowing previously logged forests is most likely an example of climate:

24. The United Nations Sustainable Development Goals (SDGs) are particularly aimed at

25. Which of the following is an environmental megatrend that has a severe social impact?

26. What type of provider of ESG-related products and services is CDP (formerly known as Carbon Disclosure Project)?

27. The investor initiative FAIRR focuses on screening out companies

28. An ESG scorecard for sovereign debt issuers has the following information:

Country 1 No carbon policy and high corruption risk

Country 2 High-level carbon policy and low corruption risk

Country 3 Detailed carbon policy and low corruption risk

Based only on this information, the country with the lowest ESG risk is:

29. Avoiding long term transition risk can most likely be achieved by:

30. Increased investment crowding into more ESG-friendly sectors is most likely to increase

31. In ESG integration, which of the following best describes a data-mformed analytical opinion designed to support investment decision-making?

32. Which of the following ESG investment approaches would most appropriately be used to construct a balanced and diversified portfolio?

33. Compared to an optimal portfolio that does not have any ESG restrictions a portfolio that optimizes for multiple ESG factors will most likely experience

34. The Sustamalytics database is most likely used for:

35. According to the Capitals Coalition, the stock of renewable and non-renewable natural resources that combine to yield a flow of benefits to people is best described as

36. Which of the following technologies is most likely to be viewed by investors as a strategic solution to the decarbonization of high-temperature processes?

37. In contrast to engagement dialogues, monitoring dialogues most likely involve:

38. Which of the following has the long-term goal to keep the increase in global average temperature to well below 2°C (3.6°F) above pre-industnal levels?

39. Integrating the impact of material ESG factors into traditional financial analysis for a company with strong ESG practices most likely.

40. The UK’s Green Finance Strategy identifies the policy lever of financing green as

41. Which of the following would credit rating agencies (CRAs) most likely focus on in order to test how ESG factors affect an issuer’s ability to convert assets into cash?

42. Which of the following ESG investing approaches aims to drive positive change in the way investee companies are governed and managed?

43. Which of the following statements about social trends is most accurate?

44. With respect to ESG engagement for a company that is a going concern, the interests of equity investors and debt investors are most likely.

45. To produce a rating, an ESG rating provider will most likely apply a weighting system to

46. According to the McKinsey framework which of the following elements of sustainable investing is allocated to the investment dimension of tools and processes?

47. Uploading a portfolio to an external ESG data provider’s online platform

48. Which of the following is best described as a risk management framework for assessing environmental and social risk in project finance?

49. Which of the following is most likely the primary driver of ESG investment for a life insurer?

50. Which of the following would most likely be the initial step when drafting a client's investment mandate?

51. According to Mercer Consulting, which of the following asset classes has the highest availability of sustainability-themed strategies compared to its asset-class universe?

52. According to the Sustainability Accounting Standards Board (SASB) materiality risk mapping, greenhouse gas emissions (GHG) are most material for the

53. Which of the following statements about the Green Claims Directive (GCD) is most accurate? The GCD:

54. When incorporating ESG factors into valuation inputs, which of the following would most likely require the lowest discount rate?

55. Excluding investment in companies with a history of labor infractions is best categorized as a(n):

56. According to the Active Ownership study, which of the following statements regarding ESG engagement is most accurate?

57. Which of the following statements about voting is most accurate?

58. In which country is the proposal of shareholder resolutions most common?

59. Which of the following emphasizes that short-term investment performance will be of limited significance in evaluating the manager?

60. One of the mam principles of stewardship codes calls for institutional investors to:

61. Wastewater treatment facilities:

62. With respect to the current state of ESG disclosure globally, issuer reporting frameworks for ESG information are

63. A portfolio manager may need to adopt a more appropriate ESG benchmark rather than a broad market benchmark if the degree of exclusions results in:

64. Fund labelers are most likely classified as:

65. Which of the following is most likely categorized as an external social factor?

66. According to the Taskforce on Nature-related Financial Disclosures (TNFD), the four realms of nature include

67. Which of the following statements about ESG integration in fixed income is most accurate?

68. The Cadbury Commission proposed that:

69. Which of the three ESG factors is most often taken into consideration by traditional investment analysts?

70. Which of the following factors is most relevant to the performance outlook of a military equipment manufacturer?

71. Formal corporate governance codes are most likely to

72. The offering of indexes and passive funds with ESG integration by asset managers

73. Which of the following increases pressure on natural resources?

74. Which of the following is an example of shareholder engagement? Institutional investors:

75. Which of the following statements about quantitative ESG analysis is most accurate?

76. Performance materiality:

77. low risk exposure to this factor in the short run

78. Which of the following statements regarding ESG screening is most accurate?

79. The role of auditors is to assess the financial reports prepared by management and to provide assurance that:

80. Regarding ESG issues, which of the following sets the tone for the investment value chain?

81. A discount retailer facing high employee turnover due to poor working conditions will most likely experience:

82. To fall in scope of mandatory compliance with the EU’s Corporate Sustainability Reporting Directive (CSRD), companies would need to meet which of the following conditions?

Condition 1 EUR40 million in net turnover

Condition 2 EUR20 million in assets

Condition 3 250 or more employees

83. Which of the following is most likely an example of a negative externality?

84. For a board to be successful the most important type of diversity needed is:

85. Assessing the alignment of local labor laws with International Labour Organization (ILO) principles is an example of social analysis at the:

86. An asset manager considering environmental risks would most likely use:

87. Jurisdictions are most likely to impose extraterritorial laws in relation to:

88. Working conditions on a tree plantation are most likely an example of a(n)

89. According to the framework of the Task Force on Climate-Related Financial Disclosures (TCFD): the formula for carbon intensity at the portfolio level weighs emissions based upon an issuer's:

90. According to a study of the Hermes UK Focus Fund: which of the following engagement objectives was most likely to be achieved through shareholder activism?

91. Which of the following climate risks are systemic risks to the financial system?

92. Which of the following types of ESG bonds provide financing to issuers who commit to future improvements in sustainability outcomes?

93. When searching for an asset manager with an ESG approach, in the request for proposal (RFP) an

institutional asset owner would most appropriately ask:

94. Companies may be excluded from the UK Modern Slavery Act on the basis of:

95. Which of the following is most likely a reason for concern regarding the quality of a company's ESG disclosures?

96. Norms-based screening is the largest investment strategy in

97. Compared with younger people, older people are more likely to have:

98. Which of the following is an advantage of using ESG index-based strategies?

99. When assessing credit and ESG ratings, which of the following statements is most accurate?

100. In ESG integration, model adjustments are typically performed at the: