Free GARP SCR Exam Dumps Questions & Answers

A large European bank implements the PRB and hires an external auditor to assess implementation progress.
After an initial assessment, the auditor prepares recommendations to improve governance and culture practices within the bank. Which of the following actions did the external auditor most likely recommend?

• A.  Embed sustainability targets within employee remuneration and incentive programs.
• B.  Integrate ESG disclosures into existing bank reporting processes.
• C.  Use SDGs as a framework to evaluate the bank value creation model.
• D.  Publish bank commitments to the Paris Agreement.

The CRO at a commercial bank in China examines the negative impact of climate-related physical risk on clothing manufacturer cash flows that subsequently lead to higher credit risk.
The CRO observes which event leading to increased credit risk from climate physical risk?

• A.  Disruptions in the raw material supply due to climate adaptation
• B.  Rising costs of outdated manufacturing equipment write-offs
• C.  Higher costs of adaptation to stricter new low-carbon standards
• D.  Decrease in production capacity due to higher labor absenteeism

An insurance firm announces it will adopt sustainable practices. To inform sustainable strategy, a company risk analyst researches climate risk. The analyst reviews how climate risk manifests as financial risk through effects on microeconomic company-level risks on various types of companies and institutions. The analyst also identifies possible opportunities resulting from climate risk. Risks and opportunities are presented to senior management.
Which of the following does the analyst cite as an example of how climate risk affects liquidity risk?

• A.  A company's high-emissions factory is hit with a higher carbon tax that results in asset stranding, which causes the company to have less collateral to use to secure funding.
• B.  A bank's customers withdraw deposits and draw on credit lines to finance cash-flow needed for recovery after damaging flooding, which increases loan-to-deposit ratios.
• C.  A mining company that extracts lithium for lithium-ion batteries benefits from higher commodity prices, which increases revenue and profits.
• D.  A company's warehouse that is damaged by a tornado causes business interruption that results in loss of revenues and profits, which weakens the company's ability to repay loans.

A multinational food and beverage corporation has growing concerns that CO2 and other GHGs in the atmosphere have a negative effect on agricultural productivity. The corporation is subject to higher costs and scarce availability for commodities necessary for its supply chain.
The corporation will disclose this scenario under which climate-related risk type?

• A.  Resource efficiency
• B.  Chronic
• C.  Market
• D.  Resilience

A retail company operates internationally, and increasingly incurs scrutiny for environmental and social impacts. In response, the company adopts the SDGs. The company sustainability director begins this process by linking the SDGs to material concerns for the company.
Which strategy should the director suggest the company take to directly address one of the SDGs?

• A.  Disclose ESG factors to investors and stakeholders.
• B.  Ensure the company follows through on stated CSR commitments.
• C.  Promote equitable access to water for surrounding communities.
• D.  Maximize profits from green forest bonds.