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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions (Q69-Q74):

NEW QUESTION # 69
GlobalTechManufacturing (GTM), a multinational company, operates a complex supply chain spanning multiple countries and stakeholders. Recognizing this complexity as a major risk, the Chief Supply Chain Officer (CSCO) has launched a supply chain mapping project. The objective is to analyze GTM's supply chain structure and develop risk mitigation strategies. The initial phase of this project will primarily focus on understanding which of the following aspects within GTM's supply chains?
1. Branding
2. Tiers
3. Complexity
4. Innovation

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

Answer: C

Explanation:
Option 2 - Supply chain mapping involves a detailed analysis of supplier layers, including Tier 1, Tier 2, and Tier 3 suppliers. Identifying these tiers allows GTM to trace the flow of materials, information, and services throughout the supply chain. This visibility is crucial for assessing supplier relationships, dependencies, and risks at each level, helping to mitigate potential disruptions. Therefore, this is a correct answer.
Option 3 - GTM's supply chain is extensive and intricate, spanning multiple countries with interconnected layers. Understanding this complexity helps identify risks, inefficiencies, and bottlenecks. Mapping the network enables GTM to manage interdependencies and enhance supply chain resilience, making this another correct answer.
Incorrect answer:
Option 1- While branding is important for market presence and customer perception, it is not directly related to supply chain mapping or risk mitigation in this context.
Option 4- Innovation is valuable for driving competitive advantage and improving processes, but the focus here is on understanding the current structure of the supply chain to address risks, not on developing new innovations.
By focusing on tiers and complexity, GTM can lay a strong foundation for managing its global supply chain risks effectively thus the answer is Choice A.
Reference:
LO-2.1; Page 145-148; Mapping supply chains to achieve supply chain transparency

NEW QUESTION # 70
Ben & Jerry's products feature a Fair Trade mark, demonstrating their commitment to ethical sourcing. Which of the following strategies do they use to uphold labor standards within their supply chain?

A. Offering higher prices for all ingredients, regardless of quality
B. Auditing and reporting on labor practices to ensure compliance
C. Relying solely on self-reporting from suppliers about labor condition
D. Implementing a policy that allows for flexibility in labor standards based on local laws

Answer: B

Explanation:
Choice C- By conducting regular audits and reporting on labor practices, Ben & Jerry's ensures that its suppliers adhere to fair labor standards. This process helps identify and address any issues related to working conditions, wages, and worker rights, thereby promoting accountability and transparency within their supply chain.
Incorrect answer:
Choice A- While paying fair prices is important, simply offering higher prices does not guarantee that labor standards are met.
Choice B- This approach can be misleading because self-reporting may not accurately reflect actual conditions without external verification.
Choice D- This could be misleading as it may suggest that local laws can justify subpar labor practices, which contradicts the fair trade ethos.
Reference:
LO-1.3; Page 88-89; Labor standards and working practices

NEW QUESTION # 71
A multinational engineering firm operates across multiple countries and has publicly committed to diversity and inclusion. However, an independent audit uncovers systemic issues:
1. Women with equal qualifications as men are consistently paid less for similar roles across all branches.
2. In the firm's regional office in Country X, minority ethnic applicants are frequently rejected for managerial roles without valid justification.
3. Employees with disabilities in Country Y are disproportionately placed in lower-growth roles, despite having skills for higher positions.
When questioned, leadership attributes these disparities to "cultural differences" and "regional norms." Which key labor rights issue does this scenario illustrate, and what actions should the company prioritize?

A. Freedom of association and collective bargaining; the company should allow workers to unionize and address these disparities through collective agreements
B. Elimination of discrimination in respect of employment and occupation; the company should implement a comprehensive diversity policy and actively monitor pay equity and equal opportunities
C. Elimination of forced labor; the company should focus on ensuring no workers are coerced into taking undesirable roles
D. Abolition of child labor; the company should ensure that all employees meet the legal working age

Answer: B

Explanation:
Option B- The scenario highlights discriminatory practices in pay disparities based on gender, hiring biases against minority ethnic groups, exclusionary treatment of employees with disabilities. The ILO's principle of eliminating discrimination in respect of employment and occupation requires companies to ensure equal treatment in hiring, pay, and opportunities, regardless of gender, ethnicity, or disability. The company's justification of "cultural differences" and "regional norms" does not absolve it of its responsibility to adhere to international labor standards.
Incorrect answer:
Option A- There is no evidence of coercion or lack of consent in employment.
Option C- The scenario does not mention issues related to unionization or collective bargaining.
Option D- No mention of underage workers is made in the scenario.
Reference:
LO-3.1; Page 253-254; Standards set by the United Nations (UN) and the International Labor Organization (ILO)

NEW QUESTION # 72
Which of the following technologies is increasingly being adopted in supply chain management to enhance transparency, traceability, and prevent counterfeit products?

A. Value Stream Mapping
B. Value chain mapping
C. Blockchain
D. Supply Chain Operations Reference (SCOR)

Answer: C

Explanation:
Option B- Blockchain technology aids supply chain mapping by providing tranparency over transactions and data exchanges across the supply chain. Blockchain enables every transaction or activity across the supply chain to be securely recorded thus reducing instances of counterfeit products and increasing transparency in supply chain. Thus B is the correct choice.
Incorrect answer:
Option A- Value Chain Mapping focuses on analyzing activities within a business to identify value-adding processes.
Option C- Value Stream Mapping is a lean tool for visualizing and improving workflow.
Option D- Supply Chain Operations Reference (SCOR) is a model for managing and improving supply chain performance.
Reference:
LO-2.1; Page 149; Mapping supply chains to achieve supply chain transparency

NEW QUESTION # 73
A small-scale cocoa farmer in a developing country is a member of a Fair Trade cooperative, which benefits from a guaranteed minimum price for cocoa and a Fairtrade Premium. However, some members have expressed concerns about the system. Which of the following is a common criticism of the Fair Trade standard that might explain their dissatisfaction?

A. Farmers who are not part of the cooperative cannot access the benefits of Fair Trade
B. The administrative costs of certification and compliance reduce the net income for farmers
C. All of the above
D. The Fairtrade Premium is too small to make a meaningful impact on the community

Answer: C

Explanation:
Choice A- Critics argue that while the premium is helpful, it may not always be sufficient to address significant challenges like poverty or infrastructure gaps in the community.
Choice B- Fair Trade certification often requires membership in a cooperative, which excludes independent farmers or those unable to join due to geographic or financial barriers.
Choice C- Fair Trade certification comes with costs and stringent requirements, which can burden farmers and cooperatives, sometimes negating the financial benefits of participation.
Choice D- This is the correct answer because all the options accurately highlight potential limitations of the Fair Trade system.
Reference:
LO-3.3; Page 306; Fairtrade standards that affect the workplace and producers and their implications for procurement and supply

NEW QUESTION # 74
......

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