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CIPS Managing Ethical Procurement and Supply (L5M5) L5M5 Prüfungsfragen mit Lösungen (Q59-Q64):
59. Frage
A company frequently ships high-value goods internationally, and the logistics team identifies a significant risk of financial loss due to potential cargo theft or damage during transit. To mitigate this risk, the company hires an external freight forwarder who provides insurance coverage and assumes full responsibility for the goods while in transit.
What is the most appropriate risk management strategy in this scenario?
- A. Treat
- B. Tolerate
- C. Transfer
- D. Terminate
Antwort: C
Begründung:
Option B- By hiring the external freight forwarder with insurance coverage, the company shifts the responsibility and potential financial loss to a third party. Thus, the correct answer is B.
Incorrect answer:
Option A- "Treat" involves taking action to mitigate the risk internally. For example, the company could implement its own security measures, such as using GPS tracking, enhanced packaging, or employing in-house logistics staff. In this scenario, the company is not mitigating the risk itself but instead transferring the responsibility to the freight forwarder.
Option C- The risk of theft or damage is significant in this scenario, and ignoring it would likely result in substantial financial losses. Hence, tolerating the risk is not a viable strategy.
Option D- Terminating the activity is not practical for the business, as shipping goods internationally is likely critical to operations. Instead, transferring the risk to the freight forwarder is a more reasonable approach.
Reference:
LO-2.1; Page 166; Use of risk mitigation strategies to achieve ESG objectives to secure ethical and sustainable procurement and supply arrangements
60. Frage
A procurement officer at a global retail company is responsible for sourcing raw materials for a new product line. With the company committed to ethical sourcing practices, including Fair Trade, the officer aims to clearly communicate Fair Trade requirements to potential suppliers. Where should these requirements be included to ensure compliance?
- A. In the company's annual sustainability report
- B. In the specifications section of the tender document
- C. In internal emails to the procurement team
- D. During supplier performance review meetings after contracts are signed
Antwort: B
Begründung:
Choice B- Fair Trade requirements must be included in the specifications section of the tender documents so that potential suppliers are aware of and can comply with these requirements before submitting bids or entering into agreements.
Other options, like internal communications or sustainability reports, do not effectively communicate requirements to suppliers in a legally enforceable way.
Reference:
LO-3.3; Page 311-312; Fairtrade standards that affect the workplace and producers and their implications for procurement and supply
61. Frage
Mila's Catering Services has committed to paying living wages to its workers as part of its ESG objectives. Which of the following are reasons for this initiative? Select any TWO.
- A. Creates a positive impact on the society
- B. Paying a living wage can be expensive, especially for small businesses with thin profit margins
- C. Living wage laws can reduce job opportunities for less-skilled workers
- D. Improves long term buyer supplier relationships and makes them sustainable
Antwort: A,D
Begründung:
Choice B - Paying living wages improves long term buyer supplier relationships and makes them sustainable thus is good for business. This option is correct.
Choice D- Living wages workers are working individuals who can actively take part in the local economy and boost local businesses. This therefore motivates business leaders and employees who want their company to make a positive impact on the society. This is also the correct answer.
Choice A - The imposition of living wages reduces job opportunities for the very families they are intended to help. When wages are legislated by government above those that would result in a competitive market, employers respond by reducing the number of workers they employ and/or the number of hours their employees work. That means living wage laws lead to higher unemployment for low-skilled workers and reduce opportunities for those entering the workforce to gain valuable skills and work experience. This is a downside of living wage and not a reason to take the initiative.
Choice C -Considering cost, paying a living wage can be expensive, especially for small businesses with thin profit margins thus is not a reason to undertake the initiative.
Reference:
LO-1.3; Page 92-93; Wages and social security arrangements
62. Frage
While low-cost country sourcing can provide substantial cost savings for buyers, it also comes with significant risks. Which of the following should be avoided as a potential target for low-cost country sourcing?
- A. A country that is remote geographically but with good transportation routes
- B. A country with stable tax and tariff structures
- C. A country consisting of workers with detailed knowledge of the product
- D. A country where companies use Just in Time (JIT) method of SCM
Antwort: D
Begründung:
Choice B-It is important to calculate the potential cost of a supplier failing to meet the level of service timeline. If a company uses JIT methods of supply chain management, then LCCS is not a suitable option especially for critical components because delivery delays can be costly and disruptive. Without backup inventory, customers may have to wait for the company to receive supplies and manufacture the product. Thus is the correct answer.
Incorrect answer:
Choice A- A country with good transportation routes is critical to analyse as shipping will be fairly economical. Therefore is a potential target for LCCS.
Choice C- Level of education and skills of workers in chosen low cost country will help in producing vital key components as they will specialize in them. Thus this country should be a potential target of LCCS.
Choice D- Tariffs and taxes can significantly impact the cost-effectiveness of sourcing from low-cost countries. Understanding the export taxation in the source country and import tariffs in one's own country is crucial. This being stable can help in calculating and making a decision of selecting a country for low cost sourcing.
Reference:
LO-1.2; Page 76; Low-cost country sourcing
63. Frage
The development of a documented process to assess the environmental performance of suppliers prior to appointment, would be covered by which part of an ISO 14001:2015 environmental management system?
- A. Context of the organization
- B. Operation
- C. Support
- D. Performance evaluation
Antwort: B
Begründung:
Choice B- This is the correct answer. The "Operation" clause of ISO 14001:2015 includes the need for an organization to establish processes for managing external impacts, such as assessing the environmental performance of suppliers and considering their sustainability efforts before appointing them.
Incorrect answer:
Choice A- This part of the ISO 14001:2015 focuses on monitoring, measuring, analyzing, and evaluating the environmental performance of the organization. It is more about assessing the internal processes rather than supplier assessment.
Choice C- This part focuses on understanding the external and internal factors that influence the organization's environmental management system, but not directly on supplier assessment processes.
Choice D- This section covers the resources, competence, awareness, communication, and documented information needed to support the environmental management system, but does not directly address the supplier evaluation process.
Reference:
LO-3.2; Page 284; Role of industry standards and frameworks used by organizations in securing ESG considerations and ethical standards
64. Frage
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