The WTO (World Trade Organisation) has several functions. Which of the following is not a function of the WTO?
Answer(s): D
Comprehensive and Detailed Explanation From Exact Extract of Documents:The WTO's main functions include setting international trade rules, facilitating agreements, resolving disputes between member countries, and supporting global trade liberalisation. It also works to promote economic growth and development, indirectly aiming for higher employment and better living standards. However, the WTO does not set or enforce labour standards--this role belongs to the International Labour Organisation (ILO), which specifically governs employment rights, child labour elimination, and health and safety at work. The L5M5 study guide (p.256) emphasises the importance for procurement professionals to distinguish between global trade institutions such as the WTO and labour-focused organisations like the ILO.
Managing Ethical Procurement and Supply (L5M5) Study Guide, p.256
Nicolas is the Head of Procurement at Penny Dolittle Manufacturing Company. He is introducing an ESG agenda to the company's procurement strategy, especially regarding sustainability. Nicolas believes an advantage of this is that it will drive innovation. Is he correct?
Answer(s): A
Comprehensive and Detailed Explanation From Exact Extract of Documents:The L5M5 study guide (p.182) states that sustainability reporting and the adoption of ESG (Environmental, Social, Governance) principles can stimulate organisational change and innovation. By measuring and reporting on sustainability, companies often seek new technologies, processes, and supply models to improve performance and meet ESG commitments. Reporting is not mandatory in all cases, so option B is incorrect. While sustainability may improve reputation and sometimes costs, these are not the key focus of this question. CIPS guidance stresses that sustainability reporting can drive innovation--procurement can encourage suppliers to develop new sustainable practices, products, and approaches.
Managing Ethical Procurement and Supply (L5M5) Study Guide, p.182
What forms of organisation form the Ethical Trading Initiative (ETI)? Select THREE
Answer(s): A,D,E
Comprehensive and Detailed Explanation From Exact Extract of Documents:The Ethical Trading Initiative (ETI) is a leading alliance focused on improving working conditions in global supply chains. The L5M5 study guide (p.260) explains that ETI membership comprises:Private businesses (such as retailers and brands),Non-Governmental Organisations (NGOs), andTrade Unions.This tripartite approach enables collaboration between commercial, labour, and social interests to improve standards. Governments are not direct members, although their legislation can influence ethical trading. Public sector bodies may adopt ETI principles but are not core members. ETI's Base Code, founded on ILO conventions, outlines key principles including no forced labour, freedom of association, and fair working conditions.
Managing Ethical Procurement and Supply (L5M5) Study Guide, p.260
Which of the following are principles of the Wine and Agricultural Ethical Trade Association (WIETA)? Select THREE
Answer(s): A,B,C
Comprehensive and Detailed Explanation From Exact Extract of Documents:The Wine and Agricultural Ethical Trade Association (WIETA) is an organisation promoting fair trade and ethical practices in South Africa's wine industry. The L5M5 study guide (p.262) outlines WIETA's principles, which align with ILO standards. These include prohibition of forced labour, ensuring working hours are not excessive, and providing regular employment rather than temporary or exploitative contracts. Options D and E are not accurate--no workplace can be entirely free of risk, and sick pay is determined by national legislation, not WIETA. Procurement professionals working with agricultural sectors should be aware of such sector-specific ethical trade associations.
Managing Ethical Procurement and Supply (L5M5) Study Guide, p.262
SA8000 measures an organisation's social accountability. Which of the following is a disadvantage of this standard?
Answer(s): C
Comprehensive and Detailed Explanation From Exact Extract of Documents:SA8000 is an internationally recognised certification standard for social accountability. It requires organisations to adopt management systems to monitor compliance with social standards, including child labour elimination, safe working conditions, and fair wages. According to the L5M5 study guide (p.264), one disadvantage is the cost of implementing and maintaining the management system, which can be resource-intensive for smaller organisations. SA8000 is not industry-specific, is recognised globally, and is applicable to both large and small organisations. However, the investment in audits, training, and compliance documentation can be significant, making this a barrier for some companies.
Managing Ethical Procurement and Supply (L5M5) Study Guide, p.264
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