CFA Certificate in ESG Investing Exam Questions with Complete Correct Answers | Grade A+
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Module
CFA
Institution
CFA (CFA)
Externalities are costs that a business does not bear itself but instead imposes on others.
Which of the following is not an example of an externalised cost?
Ans: Building on brownfield sites.
Explanation
Externalities are costs that a business does not bear itself (internalise) but instead im...
A company has scored well on ESG metrics relative to its competitors, which implies a
number of things. Which of the following is not one of the implications of this relative ESG
score?
Ans: They are more likely to grow rapidly and offer higher short term returns.
Explanation
Companies that score well on ESG metrics are better able to anticipate ESG risks and
opportunities, enjoy valuation premiums due to changing investor concerns and preferences,
and are more disposed to longer term strategic thinking and planning.
What is sustainable development goal 13 (SDG 13)?
Ans: To take urgent action to combat climate change and its impacts.
, Explanation
SDG 13 is focused on climate change. SDG 13 underpins a recognition that economic
development and climate change are inextricably linked, especially where the effects of
global warming in particular can have a negative effect on growth and development.
What is the concept of the triple bottom line (TBL) in the context of corporate accounting?
Ans: TBL attempts to clearly communicate to investors and stakeholders the value created
by companies when social and environmental issues were considered systematically in their
business operations.
Explanation
TBL attempts to improve reporting practices and communicate more clearly to investors and
stakeholders the value created by companies when social and environmental issues were
considered systematically in their business operations.
Which of the following would not be considered a corporate governance issue?
Ans: Working conditions.
Explanation
Working conditions is a social issue.
Institutional investors aim to integrate ESG factors into investment decisions. Which of the
following is not a typical method by which this may be achieved?
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