CFA Institute Updated Sustainable-Investing Exam Questions and Answers by corey

Business customers often receive tailored ESG information directly from companies, which might not be included in public disclosures intended for investors. (ESGTextBook[PallasCatFin], Chapter 9, Page 499)

The use of renewable energy is an environmental factor in real estate. Integrating renewable energy sources in real estate developments helps reduce greenhouse gas emissions and alignswith sustainability goals, making it a key factor in ESG assessments of real estate portfolios.ESG Reference: Chapter 3, Page 153 - Environmental Factors in the ESG textbook.

Externalities refer to the unintended consequences of a project or asset, such as pollution, that affect its surrounding environment and society. These factors often have social or environmental impacts that are not reflected in the financial costs of the project. (ESGTextBook[PallasCatFin], Chapter 3, Page 114)

Scope 3 emissions include all indirect emissions that occur in a company’s value chain, including those associated with suppliers and consumers. These emissions are typically harder to measure and manage compared to Scope 1 and Scope 2 emissions, which are more directly controlled by the company.ESG Reference: Chapter 3, Page 133 - Environmental Factors in the ESG textbook.