A global cosmetics company surveys consumers. The survey reveals close to 75% of consumers indicate sustainability is an important issue and are willing to change shopping habits to reduce environmental impact. The company responds by establishing a sustainability framework. As part of the process to implement this framework, a company sustainability analyst identifies sustainable investment and disclosure practices.

Which recommendation will the analyst likely make to implement a company sustainability framework?

A senior portfolio analyst at a global asset management firm performs a portfolio review to identify assets that may be affected by climate risk. Preliminary findings show the firm heavily invests in food and beverage companies with high climate risk exposure due to extreme temperatures and droughts. In a report to senior management, the analyst notes the firm can improve portfolio performance by examining physical risk, as the firm currently focuses primarily on transition risk.

Which approach to examining physical risk at the portfolio level should the analyst recommend?

A multinational footwear company prepares its annual GHG inventory. The company sustainability director organizes data according to the GHG Protocol and prepares a set of recommended actions to lower company emissions.

Which action is the director most likely to recommend to reduce company Scope 3 emissions?

A global commercial bank assesses the potential impact of physical climate risk on its project finance portfolio. The bank will grow the project portfolio and invest heavily in assets with the lowest risk. A bank risk manager examines how physical risk can transmit into the financial performance of portfolio assets. How should the risk manager evaluate these assets?

A sustainability analyst for a global food and beverage company tracks ESG metrics to report to investors. The analyst meets with company leaders of different business units to explain criteria and indicator types for each ESG component.

To address each component, which metrics will the analyst socialize with company leaders?

An international hotel chain reviews progress on sustainability goals in preparation for an Earth Day marketing campaign. A sustainability director suggests the hotel highlight how its energy and food sustainability initiatives align with UN SDG targets.

Which of the following correctly describes an SDG target that the hotel could align with?

A large insurance company in South America expands use of climate scenario analysis. The company used RCPs in previous scenario analyses but now hires an actuary with climate expertise to incorporate SSPs in this process.

How can the actuary advise the insurance company use SSPs going forward?

A scientist at a large agricultural company develops an internal presentation that explains weather variation and long-term climate change. The scientist presents global annual temperature anomalies (relative to a 1951-1980 average) throughout the last 20 years:

What natural forcing contributed to the temperature trend from 2014 to 2016?

Which of the following greenhouse gases (GHGs) has the longest lifetime in the atmosphere?

To assess potential business implications of climate change, a large manufacturing company implements scenario analysis for the first time. The company hires a consultant to help incorporate climate-related considerations into a model of the company’s potential business outcomes.

What useful scenario analysis information should the consultant make the company aware of?