CFA Institute ESG-Investing Actual Free Exam Questions & Community Discussion

Exam Code/Number: ESG-Investing
Exam Name/Title: Certificate in ESG Investing
Certification Provider: CFA Institute
Corresponding Certification: ESG Investing Certificate

Exam Questions: 618
Updated On: May 30, 2026

Question #57

Increased investment crowding into more ESG-friendly sectors is most likely to increase:

A. valuations.

B. expected returns.

C. materiality thresholds.

Discussion 0

Correct Answer: A Vote an answer

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Question #58

A company has an audit contract with one Big Four firm and non-audit contracts with two other Big Four firms. Which scenario is most likely to materialize when the company rotates its auditors?

A. There will be a sub-optimal level of competition for the audit

B. The new auditor will miss material issues that the existing auditor would have identified

C. The new auditor will be eligible for new non-audit contracts

Discussion 0

Correct Answer: A Vote an answer

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Question #59

Which of the following is a form of individual engagement?

A. Active public engagement

B. Informal discussions

C. Follow-on dialogue

Discussion 0

Correct Answer: B Vote an answer

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Question #60

One of the steps in developing an ESG scorecard is to:

A. Prepare a materiality map of scored indicators

B. Assign red flags to scored indicators

C. Calculate aggregate scores at the issue level

Discussion 0

Correct Answer: A Vote an answer

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Question #61

Asset owners can reflect ESG considerations through corporate engagement by:

A. using ESG criteria to identify investment opportunities through a thematic approach.

B. discussing ESG issues with an investee company's board.

C. working with regulators to design a more stable financial system.

Discussion 0

Correct Answer: B Vote an answer

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Question #62

Engagement teams with a history of governance-led engagement are most likely to be organized:

A. by sector.

B. by asset class.

C. geographically.

Discussion 0

Correct Answer: A Vote an answer

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Question #63

Which of the following board committees aims to ensure that the board is balanced and effective?

A. Compensation committee

B. Audit committee

C. Corporate governance committee

Discussion 0

Correct Answer: C Vote an answer

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Question #64

Which of the following is a principle of the Net Zero Asset Managers Initiative?

A. Aligning all assets under management (AUM) to net zero immediately

B. Achieving net zero by 2025

C. Implementing engagement strategies with investee companies to encourage net zero alignment

Discussion 0

Correct Answer: C Vote an answer

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Question #65

ESG performance attribution:

A. Can be measured using commercially available tools.

B. Can be decomposed using Brinson and risk factor attribution.

C. Is simple to apply within fixed-income portfolios.

Discussion 0

Correct Answer: B Vote an answer

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Question #66

Which of the following statements about externalities is most accurate?

A. Measures to internalize externalities can be taken by corporates or governments

B. Private costs are higher than societal costs when externalities are negative

C. Externalities are reflected in the prices of commercial goods and services

Discussion 0

Correct Answer: A Vote an answer

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Question #67

An analyst derives correlations to determine how ESG factors might impact financial performance over time and then weights those factors appropriately within the portfolio. This approach is best described as:

A. Algorithmic

B. Thematic

C. Systematic

Discussion 0

Correct Answer: C Vote an answer

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Question #68

Measuring a portfolio's carbon intensity using the European Union's Sustainable Finance Disclosure Regulation (SFDR) accounts for:

A. Scope 1 emissions only.

B. Scope 1, Scope 2, and Scope 3 emissions.

C. Scope 1 and Scope 2 emissions only.

Discussion 0

Correct Answer: B Vote an answer

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Question #69

Impact investment funds most likely align their portfolios with:

A. OECD Guidelines for Multinational Enterprises.

B. Sustainable Development Goals.

C. ESG frameworks that are norms-based.

Discussion 0

Correct Answer: B Vote an answer

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Question #70

Compared to stewardship codes drafted by the fund management industry, stewardship codes with regulatory backing most likely place greater emphasis on:

A. Conflicts of interest management.

B. Escalation activities to protect and enhance shareholder value.

C. Disclosure of voting activity.

Discussion 0

Correct Answer: B Vote an answer

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