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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions:

1. XYZ Corporation has been acquired by a global company that plans to centralize all sourcing activities and standardize processes. Which factor could help XYZ Corporation gain a competitive advantage through this centralization?

A) Improved benchmarking shared data to provide ability to agree prices with global competitors
B) Efficiency gains that lead to increased productivity and lower prices
C) Ability to use more favorable legislation in different countries and avoid local legal obligations
D) Increased due diligence activity resulting in lower governance of suppliers

2. Which of the following form the 'Triple Bottom Line'? Select THREE

A) product
B) people
C) planet
D) profit
E) placement

3. A company frequently ships high-value goods internationally, and the logistics team identifies a significant risk of financial loss due to potential cargo theft or damage during transit. To mitigate this risk, the company hires an external freight forwarder who provides insurance coverage and assumes full responsibility for the goods while in transit.
What is the most appropriate risk management strategy in this scenario?

A) Treat
B) Transfer
C) Terminate
D) Tolerate

4. Which of the following statements best describes the potential risks associated with adopting ESG considerations?

A) Implementing ESG considerations guarantees immediate financial returns and market leadership
B) Adopting ESG practices eliminates all regulatory scrutiny and compliance requirements
C) Greenwashing can lead to a loss of consumer trust and brand reputation when companies falsely claim to be environmentally friendly
D) ESG initiatives are primarily concerned with social factors and do not impact environmental or governance aspects

5. During the transition phase at the end of a contract, what is typically the most challenging aspect to manage?

A) Developing an exit strategy
B) Transferring documents
C) Knowledge transfer and intellectual property (IP) rights
D) Returning physical assets

Solutions: