Amazon
Avaya
Cisco
CompTIA
CrowdStrike
EC-Council
EXIN
Fortinet
Google
ISC
ISC2
ITIL
Juniper
Microsoft
NVIDIA
Okta
Palo Alto Networks
Salesforce
All Vendors
  1. Home
  2. CFA
  3. Sustainable-Investing

CFA Sustainable-Investing Exam (page: 17)
CFA Sustainable Investing Certificate(-SIC)
Updated on: 09-Feb-2026

Viewing Page 17 of 102
Sustainable-Investing PDF 802 Questions

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

  1. Defining how to measure ESG performance
  2. Clarifying the client's ESG investment beliefs
  3. Defining how to measure financial performance

Answer(s): B

Explanation:

The initial step when drafting a client's investment mandate should be clarifying the client's ESG investment beliefs. This foundational step helps in defining the client's values, objectives, and priorities related to ESG, which will guide the entire investment strategy and ensure that it aligns with the client's expectations and goals.



Which of the following encourages institutional investors to work together on human rights and social issues?

  1. Human Rights 100+
  2. OECD Guidelines for Multinational Enterprises
  3. United Nations Guiding Principles on Business and Human Rights

Answer(s): C

Explanation:

The United Nations Guiding Principles on Business and Human Rights encourage institutional investors to work together on human rights and social issues. These principles provide a global standard for preventing and addressing the risk of adverse impacts on human rights linked to business activity, promoting collaborative efforts among investors to uphold human rights standards.



New technologies have enabled workers to:

  1. improve their work-life balance only.
  2. adopt more flexible working patterns only.
  3. both improve their work-life balance and adopt more flexible working patterns.

Answer(s): C

Explanation:

New Technologies and Work Patterns:

New technologies, such as telecommuting tools, cloud computing, and collaboration software, have significantly transformed the workplace by enabling workers to improve their work-life balance and adopt more flexible working patterns.

1. Improved Work-Life Balance: Technologies such as remote work platforms (e.g., Zoom, Microsoft Teams) allow employees to work from home, reducing commute times and providing more time for personal activities. This flexibility helps employees balance professional responsibilities with personal and family commitments, thereby enhancing overall well-being.

2. Flexible Working Patterns: Advanced technologies enable flexible work schedules, allowing employees to work at times that suit them best, rather than adhering to traditional 9-to-5 schedules. This flexibility can lead to increased productivity and job satisfaction as employees can choose work hours that align with their peak performance times and personal preferences.

Reference from CFA ESG Investing:

Workplace Flexibility: The CFA Institute highlights the role of technology in enabling workplace flexibility, which can lead to better employee satisfaction and productivity. Improved work-life balance and flexible working patterns are essential aspects of modern work environments facilitated by technological advancements.

Remote Work: The shift towards remote work, accelerated by technological advancements, has allowed employees to manage their time more effectively, leading to a better balance between work and personal life.

In conclusion, new technologies have enabled workers to both improve their work-life balance and adopt more flexible working patterns, making option C the verified answer.



Which of the following subclasses is most likely to have the highest level of ESG integration using Mercer's ratings?

  1. Sovereign debt
  2. High-yield credit
  3. Investment-grade credit

Answer(s): C

Explanation:

ESG Integration using Mercer's Ratings:

Mercer's ratings assess the level of ESG integration across various asset classes and subclasses. Investment-grade credit is most likely to have the highest level of ESG integration compared to sovereign debt and high-yield credit.

1. Investment-Grade Credit: Investment-grade credit typically involves higher-quality issuers with better credit ratings and stronger financial stability. These issuers are more likely to integrate ESG factors into their operations and disclosures, as they often face greater scrutiny from investors and regulatory bodies. Additionally, ESG integration is more prevalent in investment-grade credit due to the higher availability of ESG data and metrics for these issuers.

2. Sovereign Debt: While ESG considerations are increasingly applied to sovereign debt, the level of integration varies significantly by country. Some governments may prioritize ESG factors, while others may not, leading to a lower overall level of ESG integration compared to investment-grade credit.

3. High-Yield Credit: High-yield credit involves issuers with lower credit ratings and higher risk profiles. These issuers may have less capacity or incentive to integrate ESG factors compared to investment-grade issuers, leading to lower levels of ESG integration.

Reference from CFA ESG Investing:

ESG Integration in Credit Markets: The CFA Institute discusses how ESG integration varies across different segments of the credit market. Investment-grade credit typically exhibits higher levels of ESG integration due to better data availability and higher investor demand for sustainable practices.

Mercer's Ratings: Mercer's ESG ratings emphasize the importance of integrating ESG factors into investment processes, with investment-grade credit generally leading in ESG integration efforts.



Corporate governance in the UK is notable for:

  1. its requirement for joint auditors.
  2. the existence of double voting rights for some shareholders.
  3. the prominence of board behavior guidelines in its Corporate Governance Code.

Answer(s): C

Explanation:

Corporate governance in the UK is notable for its comprehensive guidelines and principles that promote effective board behavior and accountability.

1. Board Behavior Guidelines: The UK Corporate Governance Code places a strong emphasis on board behavior, setting out clear guidelines for the roles and responsibilities of directors. These guidelines aim to ensure that boards act in the best interests of the company and its stakeholders, promoting transparency, accountability, and ethical behavior.

2. Joint Auditors and Double Voting Rights:

Joint Auditors: The requirement for joint auditors is more common in other jurisdictions, such as France, rather than in the UK.

Double Voting Rights: Double voting rights for some shareholders are not a feature of UK corporate governance but can be found in other markets, like France, where long-term shareholders may be granted additional voting rights as an incentive for loyalty.

Reference from CFA ESG Investing:

UK Corporate Governance Code: The CFA Institute highlights the importance of the UK Corporate Governance Code, which includes detailed guidelines on board behavior to ensure that directors fulfill their duties effectively and ethically.

Board Responsibilities: The UK Corporate Governance Code emphasizes the need for boards to maintain high standards of conduct, accountability, and governance practices, reflecting the prominence of board behavior guidelines.



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

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

Answer(s): B

Explanation:

ESG Index-Based Strategies:

ESG index-based strategies offer various advantages, including lower costs compared to discretionary, actively managed ESG strategies.

1. Lower Costs: Index-based strategies typically have lower management fees compared to actively managed strategies. This is because index funds aim to replicate the performance of a specific ESG index, requiring less research and management effort than actively selecting and managing individual securities based on ESG criteria. This cost efficiency is a significant advantage for investors seeking exposure to ESG factors without incurring high fees.

2. Fee Structures and Stewardship Activities:

Fee Structures: While ESG index-based strategies may not necessarily have slightly lower fee structures compared to other index-based strategies (option A), they do offer cost advantages over actively managed ESG strategies.

Stewardship Activities: Although stewardship activities are important, ESG index-based strategies may not offer more focused stewardship activities compared to actively managed strategies (option C), as active managers often engage more directly with companies on ESG issues.

Reference from CFA ESG Investing:

Cost Efficiency: The CFA Institute explains that index-based strategies, including ESG-focused ones, generally incur lower costs than actively managed strategies due to their passive management approach.

Index-Based ESG Strategies: These strategies provide a cost-effective way to incorporate ESG considerations into a portfolio, making them attractive to investors who prioritize cost efficiency.

In conclusion, an advantage of using ESG index-based strategies is their lower costs compared to discretionary, actively managed ESG strategies, making option B the verified answer.



Which of the following engagement styles is most likely closely aligned with passive investments?

  1. Bottom-up engagement
  2. Issued-based engagement
  3. Company-focused engagement

Answer(s): B

Explanation:

Issue-based engagement is most closely aligned with passive investments. Passive investors, who typically hold broadly diversified portfolios, often focus on specific ESG issues that affect multiple companies across sectors. They may engage with companies on these issues through collaborative initiatives or voting on shareholder resolutions, rather than engaging deeply with individual companies, which is more characteristic of active investment strategies.



Applying ESG screens to quantitative strategies directs the portfolio on:

  1. an asset basis.
  2. a top-down basis.
  3. an individual issuer basis.

Answer(s): B

Explanation:

Applying ESG screens to quantitative strategies typically directs the portfolio on a top-down basis. This approach involves integrating ESG factors into the overall portfolio construction and management process, rather than evaluating individual issuers or assets in isolation. This method ensures that ESG considerations are systematically incorporated into the investment strategy, aligning with broader portfolio goals.



Viewing Page 17 of 102



Share your comments for CFA Sustainable-Investing exam with other users:

Mark 10/24/2023 1:34:00 AM

any recent feeedback?
UNITED STATES


Gopinadh 8/9/2023 4:05:00 AM

question number 2 is indicating you are giving proper questions. observe and change properly.
Anonymous


Santhi 1/1/2024 8:23:00 AM

passed today.40% questions were new.litwere case study,lots of new questions on afd,ratelimit,tm,lb,app gatway.got 2 set series of questions which are not present here.questions on azure cyclecloud, no.of vnet/vms required for implimentation,blueprints assignment/management group etc
INDIA


Raviraj Magadum 1/12/2024 11:39:00 AM

practice test
INDIA


sivaramakrishnan 7/27/2023 8:12:00 AM

want the dumps for emc content management server programming(cmsp)
Anonymous


Aderonke 10/23/2023 1:52:00 PM

brilliant and helpful
UNITED KINGDOM


Az 9/16/2023 2:43:00 PM

q75. azure files is pass
SWITZERLAND


ketty 11/9/2023 8:10:00 AM

very helpful
Anonymous


Sonail 5/2/2022 1:36:00 PM

thank you for these questions. it helped a lot.
UNITED STATES


Shariq 7/28/2023 8:00:00 AM

how do i get the h12-724 dumps
Anonymous


adi 10/30/2023 11:51:00 PM

nice data dumps
Anonymous


EDITH NCUBE 7/25/2023 7:28:00 AM

answers are correct
SOUTH AFRICA


Raja 6/20/2023 4:38:00 AM

good explanation
UNITED STATES


BigMouthDog 1/22/2022 8:17:00 PM

hi team just want to know if there is any update version of the exam 350-401
AUSTRALIA


francesco 10/30/2023 11:08:00 AM

helpful on 2017 scrum guide
EUROPEAN UNION


Amitabha Roy 10/5/2023 3:16:00 AM

planning to attempt for the exam.
Anonymous


Prem Yadav 7/29/2023 6:20:00 AM

pleaseee upload
INDIA


Ahmed Hashi 7/6/2023 5:40:00 PM

thanks ly so i have information cia
EUROPEAN UNION


mansi 5/31/2023 7:58:00 AM

hello team, i need sap qm dumps for practice
INDIA


Jamil aljamil 12/4/2023 4:47:00 AM

it’s good but not senatios based
UNITED KINGDOM


Cath 10/10/2023 10:19:00 AM

q.119 - the correct answer is b - they are not captured in an update set as theyre data.
VIET NAM


P 1/6/2024 11:22:00 AM

good matter
Anonymous


surya 7/30/2023 2:02:00 PM

please upload c_sacp_2308
CANADA


Sasuke 7/11/2023 10:30:00 PM

please upload the dump. thanks very much !!
Anonymous


V 7/4/2023 8:57:00 AM

good questions
UNITED STATES


TTB 8/22/2023 5:30:00 AM

hi, could you please update the latest dump version
Anonymous


T 7/28/2023 9:06:00 PM

this question is keep repeat : you are developing a sales application that will contain several azure cloud services and handle different components of a transaction. different cloud services will process customer orders, billing, payment, inventory, and shipping. you need to recommend a solution to enable the cloud services to asynchronously communicate transaction information by using xml messages. what should you include in the recommendation?
NEW ZEALAND


Gurgaon 9/28/2023 4:35:00 AM

great questions
UNITED STATES


wasif 10/11/2023 2:22:00 AM

its realy good
UNITED ARAB EMIRATES


Shubhra Rathi 8/26/2023 1:12:00 PM

oracle 1z0-1059-22 dumps
Anonymous


Leo 7/29/2023 8:48:00 AM

please share me the pdf..
INDIA


AbedRabbou Alaqabna 12/18/2023 3:10:00 AM

q50: which two functions can be used by an end user when pivoting an interactive report? the correct answer is a, c because we do not have rank in the function pivoting you can check in the apex app
GREECE


Rohan Limaye 12/30/2023 8:52:00 AM

best to practice
Anonymous


Aparajeeta 10/13/2023 2:42:00 PM

so far it is good
Anonymous