QUESTION: 121

Which of the following best summarizes the studies on carbon risk?

Companies with lower levels of CO2 emissions are associated with higher returns
Companies with higher levels of CO2 emissions are associated with higher returns
There is no conclusive evidence on the link between a company's level of CO2 emissions and returns

Answer(s): C

Explanation:

Studies on carbon risk have not provided conclusive evidence linking a company's level of CO2 emissions directly to financial returns.
While some studies suggest that companies with lower emissions may be better positioned for long-term success due to regulatory and market shifts, other research indicates that the relationship is complex and influenced by various factors. Therefore, it is not universally accepted that lower emissions consistently correlate with higher returns, nor that higher emissions necessarily lead to higher returns.

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QUESTION: 122

Which of the following projects are most likely to be financed in the green bond market?

Real estate projects
Manufacturing projects
Communications technology projects

Answer(s): A

Explanation:

In the green bond market, projects that are most likely to be financed include those that have clear environmental benefits. Real estate projects, especially those focusing on energy efficiency, sustainable building practices, and reducing carbon footprints, align well with the objectives of green bonds. These projects can include the development of green buildings, retrofitting existing structures to improve energy efficiency, and incorporating renewable energy sources.

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QUESTION: 123

A materiality assessment to identify ESG issues impacting a company's financial performance is most likely measured in terms of:

likelihood only.
magnitude of impact only.
both likelihood and magnitude of impact.

Answer(s): C

Explanation:

A materiality assessment to identify ESG issues impacting a company's financial performance is most effectively measured in terms of both likelihood and magnitude of impact. This approach provides a comprehensive view of potential risks and opportunities by evaluating how likely an issue is to occur and the extent of its potential impact on financial performance. This dual assessment helps in prioritizing ESG issues that are both probable and significant in their effects.

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QUESTION: 124

Which of the following is one of the five main drivers of nature change described by the Taskforce on Nature-related Financial Disclosures (TNFD)?

Ecosystem services
Invasive alien species
Transmission channels

Answer(s): B

Explanation:

The Taskforce on Nature-related Financial Disclosures (TNFD) identifies invasive alien species as one of the five main drivers of nature change. These species can significantly disrupt ecosystems, outcompete native species, and lead to biodiversity loss. Understanding and managing the impact of invasive alien species is crucial for maintaining ecosystem health and resilience.

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Free ESG-Investing Exam Braindumps (page: 31)

QUESTION: 121

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QUESTION: 122

Explanation:

QUESTION: 123

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QUESTION: 124

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