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  1. Home
  2. CIPS Certification
  3. L5M5 Exam
  4. CIPS.L5M5.v2025-11-24.q71 Dumps
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Question 46

The Rampal Power Station, a 1320 MW coal-fired power plant, has recently faced accusations of poor health and safety standards in the workplace. Workers have reported being forced to work without safety masks, exposing them to air pollution. If Rampal Power Station fails to improve its health and safety standards, which of the following is the most likely primary consequence?

Correct Answer: B
Choice B - Loss of reputation and damage to brand is a primary consequence of poor safety standards in the workplace for the power plant.
Incorrect answer:
Choice A - This option suggests that poor health and safety standards might lead to a decrease in the quality of materials sourced. While safety issues can affect worker performance and productivity, they do not directly relate to the quality of materials acquired from suppliers. Poor health and safety standards are more likely to impact employee morale and retention rather than the procurement process.
Choice C -Environmental effect is an indirect consequence for Rampal power plant but more so to the locals living there and natural habitat. If health and safety standards are not improved, it could lead to environmental issues, but this would be a broader consequence rather than a primary one related to workplace conditions.
Choice D-Although in cases of workers injury or death, calculating insurance would be complex, as not all injury and health related costs are covered by insurance, like sick pay, lost time, fines etc. But this is more of a secondary internal challenge and not a primary consequence of the power plant.
Reference:
LO-1.3; Page 99-100; Health and safety standards
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Question 47

Patrick, a Category Manager, is procuring a high-cost item with many suppliers available and low switching costs. According to the Kraljic Matrix, what type of supplier is this?

Correct Answer: A
Comprehensive and Detailed Explanation From Exact Extract of Documents:
In the Kraljic Matrix, leverage items are high value but have many suppliers and low switching costs. The L5M5 study guide (old p.108, new p.154) explains that buyers have strong negotiation power in leverage situations and can achieve cost savings without high risk. Bottleneck items (B) are low-value but high-risk due to limited suppliers, routine items (C) are low-value and low-risk, and strategic items (D) are high-value and high-risk. Procurement professionals must use leverage strategically to maximise value.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.154
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Question 48

The MNE (Multi-National Enterprise) Declaration is designed to promote ethical and sustainable operations by multinational organisations. Which of the following are prioritised by the Declaration? Select TWO

Correct Answer: A,D
Comprehensive and Detailed Explanation From Exact Extract of Documents:
The MNE Declaration, also called the ILO Tripartite Declaration of Principles concerning Multinational Enterprises, sets out guidelines for multinational organisations to operate ethically and sustainably. The L5M5 study guide (p.267) explains that the Declaration prioritises formal economies (regulated, tax-paying, legitimate business environments) and host country labour, ensuring that local workers are not exploited. Informal economies and immigrant labour are recognised but not prioritised in the same way. The declaration is tripartite because it involves three groups: governments, employers, and workers' organisations. Procurement professionals working internationally must be aware of these principles when engaging multinational supply chains.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.267
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Question 49

A point in a supply chain where problems may arise and affect business costs is referred to as what?

Correct Answer: C
Comprehensive and Detailed Explanation From Exact Extract of Documents:
A touch point is defined in the L5M5 study guide (old p.85, new p.112) as a stage in the supply chain where risks or problems may occur, impacting costs or performance. Examples include transport (risk of damage or loss) and quality control (risk of defective goods). Identifying touch points enables procurement professionals to implement risk mitigation strategies, such as insurance, supplier audits, or contingency planning, thereby strengthening supply chain resilience.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.112
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Question 50

The illegitimate use of a person's role for gain is what form of ethical issue?

Correct Answer: B
Comprehensive and Detailed Explanation From Exact Extract of Documents:
The L5M5 study guide (p.48) defines corruption as the illegitimate use of one's role or position for personal gain. This differs from bribery (A), which is offering or accepting inducements, and fraud (C), which involves deception such as falsifying records or creating phantom suppliers. Slavery (D) refers to forced labour. Procurement professionals must recognise corruption risks, particularly in international supply chains, and implement controls such as segregation of duties, audit trails, and whistleblowing policies.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.48
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