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

1. An organization has a clear understanding of the service it requires and has precisely outlined the process for how the supplier must deliver it. It aims to use an 'outcome-focused specification.' Is this the appropriate specification approach for the organization?

A) No, in an outcome-focused specification approach, the supplier determines how to deliver the service
B) Yes, this specification approach explicitly defines how the service should be delivered
C) No, an open specification would be the better approach
D) Yes, this specification approach allows for maximum innovation from the supplier

2. EcoWear, a well-known apparel company committed to sustainability, has recently expanded its supply chain but failed to address key ESG issues, leading to the following concerns:
A supplier has been reported for using toxic dyes, causing environmental harm.
Another supplier has poor labor practices, resulting in worker strikes.
If these ESG issues remain unresolved, what are the most likely consequences for EcoWear? Select any TWO.

A) Increased Sales: Consumers are likely to overlook the issues and continue purchasing EcoWear products, boosting sales
B) Legal Benefits: EcoWear could benefit from reduced regulatory scrutiny and enjoy a more favorable legal environment
C) Reputational Damage: The company may face backlash from consumers and advocacy groups, harming its brand reputation and customer loyalty
D) Inability to secure or attract potential investments from banks

3. Liam, a Procurement Officer at Zenith Corp, oversees a contract with Apex Supplies, a key supplier of essential manufacturing components. After identifying a critical issue in Apex Supplies' delivery process, which TWO documents should Liam complete?

A) Root Cause Analysis and Corrective Action Plan
B) SWOT Analysis and KPIs
C) Corrective Action Plan and SWOT Analysis
D) KPI's and Root Cause Analysis

4. XYZ Corp is seeking industry certification and has hired an external firm to assess its compliance with regulatory requirements and industry standards. The firm will provide an unbiased evaluation and recommend improvements. What type of audit is XYZ Corp conducting?

A) Financial audit
B) Internal audit
C) Third-party audit
D) Compliance audit

5. A retail company has recently faced supply chain fraud, including counterfeit products and inflated invoices from suppliers. To enhance its fraud prevention measures, the management team is considering various strategies. Which of the following would be the most effective approach to mitigating supply chain fraud?

A) Establish a Diverse Supply Chain
B) Fact-Finding Questionnaires
C) Due Diligence on Suppliers
D) Keep Up to Date with Legislation

Solutions: