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CIPS L4M4 Exam Syllabus Topics:

SectionObjectives
Topic 1: Ethics in Procurement and Supply- Codes of conduct and ethical decision-making
- Principles of professional ethics
Topic 2: Supply Chain Risk and Compliance- Managing ethical risks in sourcing
- Supplier compliance and monitoring
Topic 3: Corporate Social Responsibility (CSR)- Stakeholder expectations and governance
- CSR frameworks and standards
Topic 4: Responsible Sourcing- Sustainability in supply chains
- Social responsibility and human rights
- Environmental considerations and impacts

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CIPS - Pass-Sure L4M4 Test Questions Answers

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CIPS Ethical and Responsible Sourcing Sample Questions (Q151-Q156):

NEW QUESTION # 151
What is a major benefit to using Incoterms when sourcing goods internationally?

Answer: A

Explanation:
Incoterms can replace lengthy contract clauses as they replace the need for contracts to detail which party is responsible for organising transport, paying duties, having the insurance etc.
Incoterms is an odd one for exam topics- some students say it was a huge part of their exam and there were many questions on this. Others said there were just one or two. Questions get randomly assigned from the bank so it's completely random how many you'll get on this topic.


NEW QUESTION # 152
Which of the following would you expect to find in an Invitation to Tender? Select THREE

Answer: C,E

Explanation:
An ITT would include details on the awarding body (usually a brief overview of the buyer), the deadline (bids must be received by a certain date) and qualifications required (such as ISO requirements or competency certificates of staff members if it's a service contract). You wouldn'tfind pricing schedules in an ITT (this would be provided by the supplier in response to the ITT), nor would you find risk assessments (a supplier might be asked to provide one as part of the quality assessment of the tender though).
Invitation To Tender Simply Explained I Thornton & Lowe (thorntonandlowe.com)


NEW QUESTION # 153
What type of ratio measures a company's ability to meet short-term obligations, focusing on converting assets to cash?

Answer: D

Explanation:
Liquidity ratios (e.g., current ratio, quick ratio) measure whether a company can cover short-term debts with liquid assets like cash, receivables, and inventory. These ratios provide insight into a supplier's ability to remain operational without defaulting on immediate obligations. Profitability ratios show long-term returns; EPS and dividends per share apply to shareholders, not supply continuity. Responsible sourcing emphasises liquidity as a key measure of supplier stability, as poor liquidity can cause supply interruptions or business failure, jeopardising contracts and buyer obligations.
Reference: CIPS L4M4 Study Guide (v2), LO: "Application" - financial appraisal, liquidity assessment.


NEW QUESTION # 154
A Request for Quotation asks a supplier to submit a price only, with no other details provided. Is this TRUE?

Answer: C

Explanation:
Request for Quotations can include more details than just prices. They can include specs and technical drawings and samples. It's like saying 'we can give you this price with these conditions'.
The other no answer is wrong because RfQ don't always include samples. A sample wouldn't be possible for a quote for an IT consultancy piece of work.


NEW QUESTION # 155
A buyer of bakery products sees wheat shortages due to poor harvests but demand remains high. How does this affect negotiation?

Answer: B

Explanation:
In commodity markets, shortages combined with sustained demand drive price increases. The buyer loses bargaining power, as suppliers can charge higher rates. Negotiating downward is unrealistic; instead, buyers should manage risk through hedging, forward contracts, or alternative sourcing. CIPS notes that responsible sourcing requires understanding market dynamics and their ethical implications (e.g., food security, affordability). The organisation must manage stakeholder expectations about pricing rather than assume negotiation leverage. This reflects the implications of market volatility in global supply chains.
Reference: CIPS L4M4 Study Guide (v2), LO: "Implications" - commodity market dynamics, supply
/demand, and negotiation position.


NEW QUESTION # 156
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