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CIPS L4M4 Exam Syllabus Topics:

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

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CIPS Ethical and Responsible Sourcing Sample Questions (Q161-Q166):

NEW QUESTION # 161
The bill of lading is one of the main documents in sea freight. Which of the following statements represent its uses? (Select TWO)

A. It provides evidence that the goods are fully insured in transit
B. It provides evidence of the contract of carriage for the goods
C. It provides evidence of the title of ownership of the goods
D. It provides evidence guaranteeing the use of Incoterms
E. It provides evidence of the country of origin of the goods

Answer: B,C

Explanation:
A bill of lading serves as:
* Evidence of the contract of carriage between shipper and carrier.
Reference: CIPS L4M4 Study Guide (v2), LO: "Application" - international trade documentation, bills of lading.

NEW QUESTION # 162
ABC Ltd works with supplier XYZ Ltd who uses a variety of subcontractors. ABC has recently learned of an ethical breach being committed by one of XYZ's subcontractors. What should ABC do?

A. Research alternative suppliers
B. Recommend remedial action
C. Seek compensation
D. Terminate the contract

Answer: B

Explanation:
ABC should do a 'root cause analysis' to find out where the issue has come about, and why. From there, once they know what the breach is and how serious it is, they can suggest corrective action.
They can't jump straight to terminating the contract or seeking damages as it's not the supplier itself but rather the subcontractor. Also that would be really hasty considering we don't know what the issue is and what the market conditions are like. That supplier may be the only one who can provide the product. We also don't know if the supplier knows about the issue themselves.

NEW QUESTION # 163
A procurement manager of a medium-sized company has suggested to their executive board that implementing an ISO environmental standard would improve procurement practices and reduce environmental and social impacts. However, some colleagues are concerned about the potential complexity and supplier resistance. Should the company go ahead with the recommendation?

A. Yes, implementation would guarantee that the company is compliant with all environmental laws
B. No, because ISO standards are only relevant to large organisations
C. Yes, as it would align with, and help to achieve, sustainability goals
D. No, ISO standards are too complex for staff and suppliers to understand and follow

Answer: C

Explanation:
Adopting ISO environmental standards aligns procurement practices with sustainability goals and helps reduce environmental and social impacts. Although implementing ISO standards may require initial adjustments, they foster long-term benefits by promoting responsible and ethical sourcing practices across the supply chain.

NEW QUESTION # 164
Tariffs and import duties imposed on a buying organisation for goods purchased from an international supplier provide benefit to ...

A. Consumers by having access to lower-priced goods
B. Local competitors through lower prices
C. The domestic industry through reduced competition
D. The supplying organisation as they receive additional payment

Answer: C

Explanation:
Tariffs/import duties increase the landed cost of imports, which shields domestic producers by making foreign alternatives relatively more expensive. They do not go to the foreign supplier and typically do not lower consumer prices.
Reference: CIPS L4M4 Study Guide (v2): LO "Implications of global sourcing" - trade barriers (tariffs/non- tariffs) and their market effects.

NEW QUESTION # 165
A company has a low gearing of 20%. This shows that the company relies on equity capital and should therefore have less difficulty coping during tough economic times. Is this statement TRUE?

A. No- a low gearing suggests that the company is financed by long-term debt rather than equity
B. Yes- a low gearing ratio shows that the business is solvent and can deal with supply chain disruptions easily
C. No- a low gearing shows you that a company isn't likely to be profitable
D. Yes- a low gearing ratio means the company's finances are made up of equity rather than debt

Answer: D

Explanation:
the correct answer is 'Yes- a low gearing ratio means the company's finances are made up of equity rather than debt'.
Remember low gearing = good (based on equity), high gearing = bad (based on debt). Anything over 50% is considered high.
The two no answers are therefore incorrect and you can discount these straight away. The other yes answer is one of those answers which COULD be true, but isn't always true, and we'd need more information to know for sure. When you get options like this there will be one that is always right and one which is sometimes right
- so always pick the always right one.
Dealing with supply chain disruptions is complex, and depending what the disruption is, how big it is, what the industry is etc determines whether a supplier can handle it or not. Because there's more factors to consider than just gearing, this isn't the right answer.

NEW QUESTION # 166
......

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