Free Certificate in ESG Investing Exam ESG-Investing Exam Practice Test

Corporate disclosures in line with the recommendations of the Corporate Sustainability Reporting Directive (CSRD) are a regulatory requirement for companies in:

• the EU only
• the UK only
• both the EU and the UK

Excluding tobacco from the investment universe is an example of which of the following ESG screening approaches?

• Universal exclusion
• Idiosyncratic exclusion
• Conduct-related exclusion

Which of the following statements regarding corporate governance is most accurate?

• Board appraisals are most effective when led by an internal facilitator.
• A board should be independent of the decisions of the previous boards.
• Gender is the most important type of diversity needed for a board to be successful.

Which of the following is an example of a social factor affecting external stakeholders?

• Human rights
• Animal welfare
• Workers' health and safety

Which of the following is most likely a result of monitoring rather than engagement?

• Changed company behaviors
• Efficient capital allocation by investors
• Delivery of corporate purpose and culture

The mechanism of dual-class shares most likely favors:

• Institutional investors
• Minority shareholders
• The founders of a company

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

• Methane
• Carbon dioxide
• Fluorinated gas

Which of the following would most likely see its estimate of intrinsic value increased by analysts?

• A company with high climate-related risk
• A company facing significant environmental regulations
• A company having launched a service that reduces customers’ electricity usage

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

• Slightly lower fee structures compared to other index-based strategies
• Lower costs compared to discretionary, actively managed ESG strategies
• More focused stewardship activities with companies compared to actively managed ESG strategies

Scorecards for ESG analysis are most likely:

• applicable to public companies but not private companies.
• used when third-party research or scores are not available.
• inappropriate for country-level assessments of sovereign bonds.