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| Section | Objectives |
|---|---|
| Corporate Social Responsibility (CSR) | - CSR frameworks and standards - Stakeholder expectations and governance |
| Responsible Sourcing | - Sustainability in supply chains - Social responsibility and human rights - Environmental considerations and impacts |
| Supply Chain Risk and Compliance | - Supplier compliance and monitoring - Managing ethical risks in sourcing |
| Ethics in Procurement and Supply | - Principles of professional ethics - Codes of conduct and ethical decision-making |
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NEW QUESTION # 289
If a commodity index shows that the price of a commodity is continually rising, what does this indicate about the market?
Answer: C
Explanation:
The correct answer is 'demand is exceeding supply'- If everyone wants to buy something, the sup-pliers will likely increase the price.
If there was little demand or there were threats of substitutions, this would likely result in a price decrease.
NEW QUESTION # 290
Which models would be appropriate for analysis of the supply market?
* Porter's Five Forces
* Porter's Value Chain
* STEEPLED
* Ishikawa Fishbone
Answer: D
Explanation:
Supply market analysis involves identifying competitive pressures and external influences. Porter's Five Forces assesses supplier power, buyer power, threat of substitutes, new entrants, and rivalry - directly relevant to market dynamics. STEEPLED analysis considers external macro-environmental factors (social, technological, economic, environmental, political, legal, ethical, demographic). By contrast, Porter's Value Chain analyses internal activities of a single organisation, while the Ishikawa diagram is a root-cause tool for problem-solving, not market analysis. Using the correct tools ensures sourcing decisions account for risks and opportunities at both industry and macro levels.
Reference: CIPS L4M4 Study Guide (v2), LO: "Concepts" - market analysis tools, external environment scanning.
NEW QUESTION # 291
Which of the following financial documents would show whether a supplier has sufficient funds to pay their subcontractors in the short term?
Answer: C
Explanation:
A cash flow statement shows the money coming in and out. This would therefore show whether a supplier has enough money coming in, to be able to pay some of it out to a subcontractor.
P&L and Balance Sheets look more broadly at finances, rather than saying what's physically in the bank at a specific given time.
Do learn the difference between these three financial documents for the exam.
Balance Sheet: Explanation, Components, and Examples (investopedia.com) Profit and Loss Statement Meaning, Importance, Types, and Examples (investopedia.com) Cash Flow Statement: How to Read and Understand It (investopedia.com)
NEW QUESTION # 292
A procurement manager has a new contract to award. There are twelve suppliers in the market. Which of the following is a benefit of using a full competitive tendering process?
Answer: D
Explanation:
A full competitive tender ensures fairness, transparency, and equal treatment of all suppliers. Each bidder has an equal opportunity to compete, and award decisions are based on pre-published criteria. This builds trust, prevents corruption, and strengthens market confidence. It is not quick or informal (A), nor does it disclose competitor bids (B). Decision-making is collective and accountable, not unilateral (D). Responsible sourcing stresses fairness and transparency in supplier engagement, ensuring a level playing field and compliance with ethical procurement standards.
Reference: CIPS L4M4 Study Guide (v2), LO: "Implementation" - tendering principles and fairness.
NEW QUESTION # 293
Which of the following factors are typically considered when assessing a supplier's financial capacity?
Answer: B
Explanation:
Profitability and asset levels indicate a supplier's financial stability and ability to meet contract demands.
Responsible sourcing practices include assessing financial capacity to reduce risk in the supply chain and ensure long-term supplier viability.
NEW QUESTION # 294
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