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One of the best things about our Ethical and Responsible Sourcing (L4M4) prep material is the convenience it offers. The CIPS L4M4 study material is available in three formats: web-based Ethical and Responsible Sourcing (L4M4) practice exam, desktop practice test software, and Prepare for your Ethical and Responsible Sourcing (L4M4) PDF. We also understand that every student is unique and learns differently, so our product is designed in three formats to adapt to their individual needs.

CIPS Ethical and Responsible Sourcing Sample Questions (Q163-Q168):

NEW QUESTION # 163
Why is it important to consider factors such as environmental, social, governance, and ethics (ESG) when analysing tenders?
* To ensure adherence to sustainability initiatives
* To improve process workflow
* To perform supplier spend and monitoring
* To identify potential risks within the supply chain

A. 1 and 4 only
B. 2 and 3 only
C. 3 and 4 only
D. 1 and 2 only

Answer: A

Explanation:
Including ESG criteria in tender analysis helps ensure suppliers align with the buyer's sustainability initiatives (1) and helps identify risks within the supply chain (4), such as unethical labour practices or environmental harm. Improving workflow (2) and spend monitoring (3) are operational concerns but not ESG drivers.
Responsible sourcing requires procurement professionals to integrate ESG into decision-making, ensuring not only cost-efficiency but also ethical compliance, resilience, and long-term value. This reflects the growing importance of corporate social responsibility (CSR) and stakeholder expectations.
Reference: CIPS L4M4 Study Guide (v2), LO: "Concepts" - ESG in sourcing decisions.

NEW QUESTION # 164
Which models would be appropriate for analysis of the supply market?
* Porter's Five Forces
* Porter's Value Chain
* STEEPLED
* Ishikawa Fishbone

A. 2 and 4 only
B. 1 and 3 only
C. 2 and 3 only
D. 1 and 2 only

Answer: B

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 # 165
A company has a requirement for an item that has been identified as strategic on the positioning model. The company needs to invite competitive tenders and ensure the selected supplier of this item is in a good financial position. What should the company ask the suppliers to send to show that their current assets cover their current liabilities?

A. Acid test
B. Profit and loss account
C. Annual turnover
D. Gearing ratio

Answer: A

Explanation:
The acid test (quick ratio) is an effective measure of a supplier's ability to meet short-term liabilities, providing insights into financial stability. This aligns with responsible sourcing by ensuring the supplier is financially capable of fulfilling a strategic contract.

NEW QUESTION # 166
Ramesh is an IT category manager within the UK's National Health Service and is responsible for the procurement of a new high-value network system, which will spread across multiple doctors' practices and community health centres. Ramesh has reviewed different tender approaches and concluded that the use of a restricted tender is the most appropriate. Which of the following statements is true for a restricted tender process?

A. Suppliers responding to the tender are pre-qualified
B. The contract will be awarded strictly on pricing criteria
C. It is only relevant when there are few suppliers in the market
D. Direct negotiations occur prior to suppliers submitting their offer

Answer: A

Explanation:
In a restricted tender process, only pre-qualified suppliers are invited to bid, ensuring that participating suppliers have met necessary qualifications. This approach helps in managing high-value contracts by focusing on capable suppliers. Ethical and responsible sourcing in the public sector demands supplier pre- qualification to ensure compliance, transparency, and quality.

NEW QUESTION # 167
A business may be faced with the challenge of deciding whether to source some of its requirements from external suppliers or whether to make them internally. Which of the following factors is likely to justify the decision to make the requirements internally?

A. The other suppliers are using older technology
B. External sourcing involves cumbersome tendering procedures
C. External suppliers are likely to be overcharging
D. The availability of in-house competencies and capacity to carry out the production

Answer: D

Explanation:
Internal production is often justified when a company has the necessary competencies and capacity. This approach aligns with responsible sourcing by leveraging internal capabilities for better control over quality, cost, and compliance with ethical and environmental standards.

NEW QUESTION # 168
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