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CFA Institute ESG-Investing Exam Questions

Exam Name: Certificate in ESG Investing
Exam Code: ESG-Investing
Related Certification(s): CFA Institute ESG Certification ESG Certification
Certification Provider: CFA Institute
Actual Exam Duration: 140 Minutes
Number of ESG-Investing practice questions in our database: 468 (updated: Jan. 19, 2025)
Expected ESG-Investing Exam Topics, as suggested by CFA Institute :
  • Topic 1: Overview of ESG Investing and the ESG Market: This section tests ESG Investment Managers and delves into responsible investment strategies, examining how environmental, social, and governance (ESG) elements shape the investment ecosystem.
  • Topic 2: Environmental Factors: This section examines environmental elements, covering systemic links, material impacts, and major trends for ESG Consultants. This section also reviews techniques for evaluating environmental impacts at the national, sectoral, and organizational levels.
  • Topic 3: Social Factors: This section focuses on analyzing social factors, including their systemic effects and material impacts. This section also provides methodologies for assessing social risks and opportunities at country, sector, and organizational levels.
  • Topic 4: Understanding Governance Factors: This section includes governance elements for ESG Investment Consultants, including core characteristics, governance models, and material impacts. It discusses how governance factors influence investment choices.
  • Topic 5: Engagement and Stewardship: This section explores the foundations of investor engagement and stewardship, emphasizing their importance and practical application.
  • Topic 6: ESG Analysis, Valuation, and Integration: Targetted for ESG Consultants, this domain covers methods for embedding ESG factors into the investment process, the obstacles that may arise, and the impact of ESG considerations on valuations across various asset classes.
  • Topic 7: ESG Integrated Portfolio: This section discusses the application of ESG analysis across multiple asset classes, exploring strategies for incorporating ESG criteria into portfolio management.
  • Topic 8: Investment Mandates and Portfolio Analytics: This domain explains to ESG Analysts the importance of constructing mandates to support effective ESG investment results. This section highlights key aspects, such as transparency and accountability, which are essential for asset owners and intermediaries to align portfolios with ESG priorities.
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Lemuel

9 days ago
Aced the CFA ESG exam! Pass4Success's materials were key to my success in such a short time.
upvoted 0 times
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Wynell

13 days ago
The ESG Investing exam is behind me now, and I couldn't have done it without Pass4Success. A question that left me unsure was about ESG analysis, valuation, and integration, particularly how to adjust valuation models to incorporate ESG data. Despite my doubts, I passed the exam.
upvoted 0 times
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Trina

1 months ago
I successfully passed the ESG Investing exam, and the practice questions from Pass4Success were a big help. One question that I found challenging was about social factors, specifically how to measure the social impact of an investment. I wasn't sure of the best indicators to use, but I managed to pass.
upvoted 0 times
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Jettie

1 months ago
ESG certification achieved! Pass4Success's practice questions were crucial for my quick prep. Thanks!
upvoted 0 times
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Isadora

2 months ago
Passing the ESG Investing exam was a significant achievement, and I owe part of my success to Pass4Success. A question that stumped me was related to investment mandates and portfolio analytics, focusing on how to align ESG goals with traditional financial objectives. Despite my uncertainty, I passed the exam.
upvoted 0 times
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Adelina

2 months ago
I am thrilled to have passed the ESG Investing exam, and the Pass4Success practice questions were invaluable. One question that puzzled me was about ESG integrated portfolios, particularly how to balance risk and return while incorporating ESG criteria. I wasn't confident in my answer, but it all worked out in the end.
upvoted 0 times
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Corinne

2 months ago
Whew, ESG exam done! Pass4Success made prep so much easier. Their questions were a lifesaver.
upvoted 0 times
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Kenny

3 months ago
Glad I could help! Remember, the key is to understand the practical application of ESG concepts. Good luck with your studies!
upvoted 0 times
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Werner

3 months ago
The ESG Investing exam was a challenging yet rewarding experience. Thanks to Pass4Success, I was well-prepared. A tricky question involved understanding governance factors, specifically about the role of board diversity in corporate governance. I was uncertain about the exact metrics to use, but I still succeeded in passing.
upvoted 0 times
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Shawnda

3 months ago
Thanks for all the insights! I'm feeling more confident about the exam now.
upvoted 0 times
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Janessa

3 months ago
Having just passed the CFA Institute Certificate in ESG Investing exam, I can say that the Pass4Success practice questions were a great help. One question that caught me off guard was about the impact of carbon emissions on investment portfolios. It asked how to integrate these environmental factors into portfolio analysis, and I wasn't entirely sure of the best approach. Nonetheless, I managed to pass the exam.
upvoted 0 times
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Antonio

3 months ago
Just passed the CFA ESG Investing exam! Pass4Success's questions were spot-on. Couldn't have done it without them!
upvoted 0 times
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Free CFA Institute ESG-Investing Exam Actual Questions

Note: Premium Questions for ESG-Investing were last updated On Jan. 19, 2025 (see below)

Question #1

The potential impacts of climate risk on asset allocation strategies are:

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Correct Answer: C

Climate risks have both local and systemic impacts on asset allocation. Local risks pertain to specific regions or industries, while systemic risks can affect the entire financial system due to the global nature of climate change. (ESGTextBook[PallasCatFin], Chapter 3, Page 139)


Question #2

A common characteristic of the EU Paris-Aligned Benchmarks and the EU Climate Transition Benchmarks is that they both:

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Correct Answer: C

Both the EU Paris-Aligned Benchmarks and the EU Climate Transition Benchmarks require an initial reduction in carbon emissions intensity in the starting year, to ensure alignment with climate goals and the Paris Agreement. (ESGTextBook[PallasCatFin], Chapter 3, Page 153)


Question #3

The potential impacts of climate risk on asset allocation strategies are:

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Correct Answer: C

Climate risks have both local and systemic impacts on asset allocation. Local risks pertain to specific regions or industries, while systemic risks can affect the entire financial system due to the global nature of climate change. (ESGTextBook[PallasCatFin], Chapter 3, Page 139)


Question #4

Are the following statements relating to investor engagement accurate?

Statement 1: Investors need to frame the engagement topic into a broader discussion around strategy and long-term financial performance with the management team.

Statement 2: Active investment houses are working to ensure that their portfolio managers can deliver stewardship alongside their regular monitoring of investee companies.

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Correct Answer: C

Both statements are accurate. Effective engagement with companies often requires framing the discussion around strategy and long-term performance. Active investment houses are also focusing on integrating stewardship activities with ongoing portfolio management. (ESGTextBook[PallasCatFin], Chapter 6, Page 285)


Question #5

An emissions trading system (ETS) permits a high allocation of free allowances to energy-intensive companies. The most likely objective of this practice is to:

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Correct Answer: B

Free allowances in an ETS are often allocated to energy-intensive companies to prevent the offshoring of emissions, also known as 'carbon leakage,' where companies relocate to jurisdictions with laxer environmental regulations. (ESGTextBook[PallasCatFin], Chapter 3, Page 153)


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