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CIPS L5M5 Exam Syllabus Topics:

Topic	Details
Topic 1	Understand initiatives and standards related to ESG (Environmental, Social, and Governance) that support ethical and sustainable procurement and supply: This section of the exam measures the skills of Procurement Leaders and covers the global frameworks and standards that shape ethical supply practices. It explores international labour standards set by organizations such as the UN and ILO, and labour codes like the Ethical Trading Initiative and SA800. Candidates also examine external environmental frameworks, industry accreditations, and their role in meeting ESG goals. Finally, this section addresses fair trade principles, organizations such as WFTO and Fairtrade International, and the need to align internal governance with global standards.
Topic 2	Understand the importance of compliance with ESG (Environmental, Social, and Governance) factors to achieve ethical and sustainable procurement and supply arrangements: This section of the exam measures skills of Supply Chain Specialists and covers methods to ensure compliance with ESG standards in procurement. It includes the use of supply chain mapping, risk management, stakeholder engagement, and contractual terms to secure sustainable practices. Candidates also learn how to monitor supplier performance, handle non-compliance, and utilize third-party auditors to maintain ethical standards. Relationship management strategies, corrective actions, and escalation processes are emphasized as part of ensuring suppliers meet ESG expectations.
Topic 3	Understand the impact of ESG (Environmental, Social, and Governance) considerations on ethical and sustainable supply chains: This section of the exam measures the skills of Procurement Managers and covers how ESG principles are applied to secure ethical and sustainable supply chains. It looks at the role of environmental, social, and governance factors in procurement decisions, alongside risks and benefits of ESG adoption. Learners also explore issues such as modern slavery, bribery, and human rights, as well as the importance of diversity, inclusion, and stakeholder management. The section highlights how globalization, culture, and labour practices shape supply strategies and examines potential conflicts that may arise when balancing ESG priorities with business demands.

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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions (Q60-Q65):

NEW QUESTION # 60
The unethical practice of using information that is not publicly available to trade on the stock market is commonly known as what?

A. bribery
B. greasing the wheels
C. insider trading
D. kickback

Answer: C

Explanation:
This is Insider Trading- the definition is on p.2

NEW QUESTION # 61
There are many different drivers of globalisation. Which of the following would be considered a cost driver?

A. To increase value for stakeholders
B. Improvements in transport technology
C. Opportunity to build economies of scale
D. Trading rules abroad less stringent

Answer: C

Explanation:
Comprehensive and Detailed Explanation From Exact Extract of Documents:
Globalisation is driven by a variety of factors, including cost, technology, and regulation. A cost driver is a factor that helps organisations reduce expenses and achieve financial efficiency. According to the L5M5 study guide (p.56), one of the most significant cost drivers is the opportunity to build economies of scale, where larger production volumes reduce per-unit costs. While improvements in technology (A) and relaxed trade rules (C) are drivers of globalisation, they are not specifically cost-related. "Value for stakeholders" (B) is broader and not strictly a cost driver. Procurement professionals should recognise economies of scale as a primary cost incentive for international sourcing and trade.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.56

NEW QUESTION # 62
A group of small-scale coffee farmers in a rural village has been receiving the Fairtrade Premium for their products. During a recent community meeting, they discuss how to allocate the premium funds for the upcoming year. Which of the following projects would best align with the principles of the Fairtrade Premium in addition to the fair trade price?

A. Allocating the funds to one farmer to expand their personal farming business
B. Distributing the funds equally among the farmers to use as they see fit
C. Investing in building a community health clinic to improve access to healthcare for all villagers
D. Using the funds to subsidize private education for the children of the wealthiest farmers

Answer: C

Explanation:
Choice B- This option aligns with the principles of Fair Trade, as the premium is intended to support projects that benefit the community as a whole, fostering development and sustainability.
Incorrect answer:
Choice A- While this might seem fair at first glance, the Fairtrade Premium is not meant for personal distribution. Its purpose is to fund collective projects that benefit the entire community, such as infrastructure, education, or health initiatives.
Choice C- This option does not align with the principles of equity and inclusivity. Fair Trade encourages using the premium to benefit the entire community, particularly the most vulnerable and marginalized groups, rather than focusing on individuals who are already advantaged.
Choice D- Providing funds to a single farmer for personal business expansion is not in line with the collective approach of Fair Trade. The premium is intended to address community-wide challenges and improve the shared resources and infrastructure for all.
Reference:LO-3.3; Page 305; Fairtrade standards that affect the workplace and producers and their implications for procurement and supply

NEW QUESTION # 63
Which organisation is responsible for the creation of the 2030 Sustainable Development Agenda?

A. NATO
B. ILO
C. ISO
D. UN

Answer: D

Explanation:
This is the UN. There are 17 sustainability goals and these are listed on p.3. For the exam it's a good idea to familiarise yourself with them, but there's no need to learn them all off-by-heart.

NEW QUESTION # 64
Which of the following scenarios best illustrate instances of bribery?

A. A buying organization excludes certain bidders from a high-value tender on the basis that these bidders have not detailed what environmental protection measures they would take
B. Upon landing at Dhaka Airport, the customs official informs that a 'standard processing fee' of $20 is required to allow entry into the country upon which a receipt for payment will be given
C. During the audit of a luxury goods distributor, the auditor was asked to take a pen home as a gift. After checking organizational policy, the auditor accepted the gift
D. A supplier has just sent the procurement official her invoice for approval. Included in her expenses is a large round sum figure for 'client entertainment' without any price breakdown

Answer: D

Explanation:
Choice B- 'Commercial organisations' commit an offence if they, or any person associated with them, bribes another person intending to obtain or retain business or a business advantage. The purpose of the expenditure is key, not necessarily the amount or what is being purchased. The extent to which the expenditure is incidental is also a factor. An itemised invoice providing a breakdown of the expense will be useful, along with further enquiries of the supplier. As there is no price breakdown, it is a valid reason to suspect the expense and is a form of bribe.
Incorrect answer:
Choice A- It is an offence to bribe another person or to be bribed. As per Bribery Act 2010, failing to prevent a bribe being paid to obtain or retain business or a business advantage is an offence. In this situation, the policy regarding acceptance of gifts was ahered to and is not bribery.
Choice C- Bribing a foreign official is an offence under the Bribery Act 2010. It is important to determine whether the fee is genuine or not; it should be accompanied with official notices and a receipt for payment. As the official informs it is a "standard processing fee" with documentary eveidence like a money receipt, it is not a case of bribery.
Choice D- As the requirement for the buying organisation was to detail environtmetal protection measures for a tender, the buying organisation has the right to reject bidders on this basis. This is not a form of bribery in any way.
Reference:
LO-1.1; Page 47-48; Issues impacting ethical and sustainable procurement and supply: modern slavery, bribery, corruption, fraud and human rights infringements

NEW QUESTION # 65
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CIPS L5M5 Exam Syllabus Topics:

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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions (Q60-Q65):

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