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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions (Q95-Q100):
NEW QUESTION # 95
Ruben is a new Procurement Manager at XYZ Company. He has been charged with buying a new piece of machinery for a factory. Having looked at several options, and considered sustainability, he has opted to buy the more expensive piece of machinery.
In terms of sustainability, why might he have made this choice?
Answer: A
Explanation:
This question is testing if you know about Whole Life Cycle Costing. You'll have come across this already at level 4 (module 7). It's a big part of sustainability. See p.14 for a quick recap on this. In terms of this question, even if you don't remember life-cycle costing, options 1 2 and 4 can't be right- we don't have information in the question that tells us that the higher priced item is better quality, from a reputable company or environmentally friendly- we just don't know based on the information we've been given so these answers can't be right.
NEW QUESTION # 96
A large retail chain, HyperMart, sources products from multiple suppliers, each specializing in different categories such as electronics, clothing, and groceries. To maintain a diverse selection, HyperMart has contracts with multiple suppliers for each product category. At the same time, these suppliers serve various large retailers and are not solely dependent on HyperMart for their sales.
In this scenario, how does the mutual independence between HyperMart and its suppliers illustrate the dynamics of the power dominance model?
Answer: C
Explanation:
In this scenario, both HyperMart and its suppliers operate independently. HyperMart has multiple suppliers to choose from, limiting any single supplier's influence. Likewise, suppliers serve multiple large retailers, including HyperMart, preventing dependency on a single customer. This mutual independence creates a balanced power dynamic, where neither party holds significant control over the other.
Thus, the correct answer is Option C.
Reference:
LO-1.4; Page 128-129; Responsible use of power relationships
NEW QUESTION # 97
A manufacturing company experienced frequent breakdowns of a critical machine due to improper maintenance. To resolve this, management is investigating the root cause and implementing measures to prevent future occurrences. What type of plan is the management prioritizing?
Answer: C
Explanation:
Choice B- This is the correct answer because the focus is on implementing measures to prevent future breakdowns and ensure the issue does not recur.
Incorrect answer:
Choice A- This would apply if the management's focus was on fixing the immediate issue (e.g., repairing the broken machine). Since the emphasis is on prevention, this is incorrect.
Choice C- While identifying the root cause is a part of the process, the plan described involves taking preventive action beyond just identifying the cause.
Choice D- This is incorrect because risk mitigation focuses on reducing potential risks, often before they occur. In this case, the issue has already occurred, and the goal is prevention, not general risk management.
Reference:
LO-2.4; Page 229-230; Creating corrective action plans and supplier development programmes
NEW QUESTION # 98
A multinational retail company faces cybersecurity incidents, including unauthorized access to customer payment data and phishing attacks. To strengthen information security, the board seeks a globally recognized framework. The IT team must recommend the most suitable ISO standard for managing these risks systematically. Which ISO standard should the company adopt?
Answer: D
Explanation:
Choice A - ISO 9001 focuses on quality management and ensuring consistent product or service delivery. While it is valuable for improving operational processes, it does not specifically address information security risks or cybersecurity threats.
Choice B - ISO 27001 is the globally recognized standard for Information Security Management Systems (ISMS). It helps organizations systematically manage and improve their cybersecurity practices, protect customer data, and mitigate risks such as unauthorized access and phishing attacks..
Choice C - This standard focuses on sustainable procurement, ensuring ethical and environmental considerations in supply chain management. It is not relevant to cybersecurity.
Choice D- This standard addresses, occupational health and safety (OH&S), helping organizations improve workplace safety and reduce risks of injuries but does not cover information security.
Reference:
LO-3.3; Page 314; Importance of updating internal and governance standards
NEW QUESTION # 99
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.
Answer: A,B
Explanation:
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
NEW QUESTION # 100
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