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L5M5 Valid Test Guide | L5M5 Guide
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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions (Q13-Q18):
NEW QUESTION # 13
The Fairtrade labeling system is built on specific Fair Trade standards. These standards are intended to directly address which TWO of the following aspects?
- A. Employee pension schemes
- B. Safe and fair working conditions
- C. Leadership and management training
- D. Fair and equitable wages
- E. Feedback and input from customers
Answer: B,D
Explanation:
Choice B- Ensuring that workers and producers are paid fairly is a key principle of Fair Trade standards.
Choice E- Fair Trade standards prioritize ensuring safe, ethical, and fair working environments for workers and producers. This is correct.
Incorrect answer:
Choice A- This is incorrect. While training programs may support broader goals, they are not the primary focus of Fair Trade standards.
Choice C- Fair Trade standards focus on ethical practices and producer welfare, not customer engagement processes.
Choice D- While Fair Trade aims to improve economic stability, pensions are not directly covered under its standards.
Reference:
LO-3.3; Page 299; Fair Trade International (FI), global fair-trade organizations and their implications for procurement and supply
NEW QUESTION # 14
A company dedicated to sustainable procurement is evaluating its processes to integrate Fair Trade goods. At which stage of the procurement process can Fair Trade requirements be most strategically incorporated?
- A. During tender specification development and supplier evaluation
- B. When monitoring supplier compliance during the contract term
- C. During pre-procurement planning and market research
- D. After contract award, during supplier performance evaluation
Answer: A
Explanation:
Choice D- This is the most strategic stage for including Fair Trade requirements, as it ensures suppliers are aware of the criteria upfront and allows for evaluation based on their adherence to these standards.
Incorrect answer:
Choice A - While monitoring suppliers post-contract is important, it's reactive rather than strategic. The ability to enforce Fair Trade requirements is limited if they weren't specified from the start.
Choice B - This stage helps identify Fair Trade suppliers and assess feasibility but doesn't directly bind suppliers to comply with Fair Trade standards.
Choice C - Compliance monitoring is crucial for maintaining standards, but it's not the stage where requirements are introduced.
Reference:
LO-3.3; Page 311-312; Fairtrade standards that affect the workplace and producers and their implications for procurement and supply
NEW QUESTION # 15
Which term describes the phenomenon where environmental disruptions in the supply chain cause amplified fluctuations in demand or inventory levels as they move upstream?
- A. Bluewashing
- B. Green Bullwhip Effect
- C. Greenwashing
- D. Fairwashing
Answer: B
Explanation:
sustainability-related disruptions lead to amplified fluctuations in demand or inventory levels throughout the supply chain.
Incorrect answer:
Option A- Greenwashing refers to the practice of companies misleading consumers about the environmental benefits of their products or operations, without making substantial sustainable improvements.
Option B- Bluewashing refers to a company's attempt to improve its reputation by associating itself with the United Nations or other international organizations without genuine commitment to the causes they claim to support.
Option D- Fairwashing refers to companies falsely claiming to support fair trade practices or other ethical standards to improve their public image without implementing those practices authentically.
Reference:
LO-3.2; Page 282; The benefits and challenges of independent standards in securing ESG objectives in ethical and sustainable procurement and supply arrangements
NEW QUESTION # 16
Ms. Nabila plans to create a CSR plan by involving all internal and external stakeholders of the company. Which TWO key components should she prioritize for the CSR plan?
- A. Refinement
- B. Introduction
- C. Philanthropic responsibility
- D. CSR Strategy
- E. Financial Analysis
Answer: A,D
Explanation:
Key components of a CSR plan
* CSR assessment
* CSR strategy
* CSR commitment to stakeholder engagement
* Implementation plan and activities
* Verification and evaluation of results
* Refinement
Reference:
LO-1.1; Page 8; Analyze the application of ethical and ESG (Environmental, Social and Governance) factors in supple chains
NEW QUESTION # 17
Social security is recognized internationally as a fundamental human right. When sourcing from developing countries, procurement professionals must be mindful of the limited social support available to low-income workers, as neglecting this issue could harm their organization's reputation. Which of the following is NOT a step toward expanding social security coverage for more people in developing countries?
- A. Separate social security benefits from a person's employment status
- B. Improve tax collection to finance the extension
- C. Increase costs of informal economy benefits
- D. Increase costs of formal sector benefits
Answer: D
Explanation:
Therefore Choice D is a not a way in which social security can be extended as we need to reduce costs of formal sector benefits. Reference: LO-1.3; Page 94; Wages and social security arrangements
NEW QUESTION # 18
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