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Exam SCR topic 1 question 23 discussion

Actual exam question from GARP's SCR
Question #: 23
Topic #: 1
[All SCR Questions]

At an international finance bank, a lack of staff clarity regarding sustainability, climate, and ESG definitions led to overlapping and inefficient initiatives. To minimize inefficiencies, the sustainability department develops new terminology for use across the bank.
What should the department include in this new terminology?

  • A. Sustainability issues fall exclusively within climate change impacts.
  • B. ESG and sustainability risks are completely interchangeable.
  • C. ESG risks are broader than all sustainability risks.
  • D. Sustainability should include all governance and social risks.
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Suggested Answer: D 🗳️
by goodforme at March 5, 2023, 3 a.m.

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goodforme
Highly Voted 1 year, 7 months ago
Selected Answer: D
Sustainability should include all governance and social risks.
upvoted 10 times
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Ramki_Looking_For_Answerkey
Most Recent 5 months, 2 weeks ago
C is wrong. Sustainability is the broadest category
upvoted 1 times
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MatMat2023
11 months, 3 weeks ago
Sustainability includes social and environmental risks. ESG includes environmental, social AND governance. Hence, ESG is broader than Sustainability.
upvoted 1 times
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kavvv
11 months, 4 weeks ago
Selected Answer: D
Sustainability is a broad category; ESG, or measuring the environmental, social, and governance performance of firms, often by financial counterparties, sits within sus-tainability. (p.30)
upvoted 2 times
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CASS74
1 year ago
Selected Answer: C
Governance is not part of sustainability. The Turnbull report and Cadbury report precede Sustainability in corporations.
upvoted 1 times
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sbrudersohn
1 year, 5 months ago
Selected Answer: C
I'd choose C. Why not D? 1. (2.1) "Investors and financial institutions, for their part, practice sustainability through the ESG policies.." 2. (2.2) "Sustainability...encompasses social and environmental awareness, and it seeks to ensure that economic activity does not harm either society or the broader environment." My comment: it refers to social and environmental instead of social and governance.
upvoted 3 times
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Karnitschnig
1 year, 5 months ago
As far as I understand it Sustainability is the broadest of all these categories. It is not right to say ESG risks are broader than all sustainability risks. ESG is used mostly by the finance world, so I really don't think of it as that broad.
upvoted 2 times
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