L5M5 Exam Dumps - CIPS Level 5 Advanced Diploma in Procurement and Supply Questions and Answers

The L5M5 study guide (p.8) outlines the six key components of a CSR plan: CSR Assessment, CSR Strategy and Refinement, Implementation Plan and Activities (C), Commitment to Stakeholder Engagement (D), and Verification and Evaluation of Results (E). An introduction (A) and financial analysis (B) may support a CSR plan but are not listed as key components. Procurement professionals should ensure CSR plans are robust, measurable, and involve stakeholder engagement to gain legitimacy and trust.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.8

The STEEPLED analysis tool examines external macro-environmental factors: Social, Technological, Economic, Environmental, Political, Legal, Ethical, and Demographic. The L5M5 study guide (p.55) confirms that “D” stands for Demographic, reflecting population trends, age structures, and workforce availability. This addition evolved from the earlier PESTLE model, later extended to STEEPLE and STEEPLED. Procurement professionals use this tool to assess external risks and opportunities that may affect supply markets and ethical sourcing.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.55

The UN Global Compact is primarily aimed at businesses. The L5M5 study guide (p.258) clarifies that while NGOs and other organisations can engage, the Compact is designed to encourage corporate responsibility in human rights, labour, environment, and anti-corruption. Since 2003, cities and public sector organisations can also join under different frameworks, but businesses remain the main focus. For procurement, this means suppliers aligned with the UN Global Compact are more likely to demonstrate compliance with global ethical standards.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.258

When cost is the overriding priority, suppliers may compromise on sustainability. The L5M5 study guide explains that cheap materials may be unsustainably sourced (e.g., timber from non-certified forests). This is particularly highlighted in the old syllabus under LO 3.4, which noted risks when cost or speed is prioritised over ESG. Procurement professionals must balance cost, quality, speed, and sustainability to avoid reputational damage and unethical practices. Focusing solely on cost undermines long-term ESG commitments.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, section on sustainability vs cost priorities

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

The WTO’s main functions include setting international trade rules, facilitating agreements, resolving disputes between member countries, and supporting global trade liberalisation. It also works to promote economic growth and development, indirectly aiming for higher employment and better living standards. However, the WTO does not set or enforce labour standards—this role belongs to the International Labour Organisation (ILO), which specifically governs employment rights, child labour elimination, and health and safety at work. The L5M5 study guide (p.256) emphasises the importance for procurement professionals to distinguish between global trade institutions such as the WTO and labour-focused organisations like the ILO.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.256

Social Security in the UK provides benefits such as sick pay, redundancy support, pensions, and maternity/paternity payments. The L5M5 study guide (p.93) specifies that payments can be made in cases of sickness (A), loss of employment (B), and retirement (C). Benefits are not provided simply for changing jobs (D) or marriage (E), as these do not affect financial or employment security. Procurement professionals need to understand social security systems, especially when working with international suppliers, since welfare provisions differ globally and affect labour conditions.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.93

The L5M5 study guide (p.182) states that sustainability reporting and the adoption of ESG (Environmental, Social, Governance) principles can stimulate organisational change and innovation. By measuring and reporting on sustainability, companies often seek new technologies, processes, and supply models to improve performance and meet ESG commitments. Reporting is not mandatory in all cases, so option B is incorrect. While sustainability may improve reputation and sometimes costs, these are not the key focus of this question. CIPS guidance stresses that sustainability reporting can drive innovation—procurement can encourage suppliers to develop new sustainable practices, products, and approaches.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.182

Procurement often considers Whole Life Cycle Costing (WLCC) rather than upfront cost alone. The L5M5 study guide (p.7) explains that while a product may be more expensive initially, it may be cheaper in the long term due to lower maintenance costs, greater durability, and reduced energy use. This approach supports sustainability by balancing financial and environmental impacts. Options A, B, and D cannot be assumed from the scenario since no evidence supports them. WLCC ensures procurement delivers long-term value, aligning with sustainability goals.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.7

Knowledge transfer and Intellectual Property (IP) rights are often the most difficult elements to manage during contract termination. The L5M5 study guide (p.241) explains that physical assets and documents can be returned easily, but IP rights and tacit knowledge (e.g., processes, experience, trade secrets) are harder to transfer and may be contested between parties. Disputes may arise over ownership of IP developed during the contract. Procurement professionals must establish clear exit strategies early in the contracting process to address these issues and avoid disputes at termination. This ensures continuity and protects business interests while maintaining ethical standards.

???? Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.241