GARP Sustainability and Climate Risk Exam
QUESTION BANK
INDEX
Chapter Pg No.
I FOUNDATIONS OF CLIMATE CHANGE: WHAT IS CLIMATE CHANGE (19 2
Questions)
II SUSTAINABILITY (19 Questions) 8
III CLIMATE CHANGE RISK (21 Questions) 13
IV SUSTAINABILITY AND CLIMATE POLICY, CULTURE AND 19
GOVERNANCE (21 Questions)
V GREEN AND SUSTAINABLE FINANCE: MARKETS AND INSTRUMENTS 25
(21 Questions)
VI CLIMATE RISK MEASUREMENT AND MANAGEMENT (22 Questions) 32
VII CLIMATE MODELS AND SCENARIO ANALYSIS (20 Questions) 39
VIII NET ZERO (13 Questions) 45
1
Sustainability and Climate Risk Exam, 2023
,Chapter 1: FOUNDATIONS OF CLIMATE CHANGE: WHAT IS CLIMATE CHANGE
1. A major good production factory uses abundant fresh water for its boiler. It asks one of its interns
to prepare a report of the impact the water vapor emissions due to human activities on its
abundance surrounding environment. This is what the intern reports:
a) Water vapor directly emissions from human activities contribute essentially nothing to its
atmospheric abundance.
b) Water vapor released by humans has direct impact on the temperature of the surroundings.
c) Water vapor released by humans increases the chance of precipitation and causes risk of
floods in surroundings.
d) Water vapor emissions from human activities contribute heavily to the surrounding
temperature.
2. A small boat making company undertakes an internal study to assess the impact of greenhouse
gas emissions on the climate change. They study multiple papers and find out an interesting fact
about greenhouse gases. Which is the below option correctly mentioning the fact about greenhouse
gases?
a) Majority of the greenhouse gases can be stored and used as a fuel for cooking and other
industrial purposes.
b) Most of the greenhouse gases remain trapped within the ground and keep leaking into the
atmosphere at a slower pace.
c) Majority of the greenhouse gas is utilized for heating up the oceans than the landmasses.
d) Greenhouse gases can be neutralized using oxidation processes like CCUS within short
period of time.
3. A large insurance company in South America expands use of climate scenario analysis. The
company used RCPs in previous scenario analyses but now hires an actuary with climate expertise
to incorporate SSPs in this process. How can the actuary advise the insurance company to use
SSPs going forward?
a) Combine SSPs with different RCPs to assess climate policy options.
b) Eventually replace SSPs with RCPs by integrating underlying data assumptions.
c) Demonstrate how SSP and RCP trajectories typically show contradictory emissions trend
trajectories.
d) Use SSPs to provide alternative emissions pathways to RCPs.
4 In preparation for an upcoming global climate conference, organizers develop climate science
training materials for business executives. How should the training material compare anthropogenic
and natural climate changes?
a) Human activities slowed water vapor feedback, whereas natural climate changes do not
alter water vapor balance.
b) Human activities caused temperature changes greater than any previous natural
temperature changes.
c) Human-induced warming currently exhibits a nonlinear relationship with global CO2 levels,
whereas natural warming shows a linear relationship.
d) It is still to be assessed and concluded if human activities any impact on temperature
change.
2
Sustainability and Climate Risk Exam, 2023
,5. A climate analyst goes through a scientific journal to study the patterns of global temperature
change and comes across a very interesting point. Which one of the below points is found to be
true?
a) Warming has been declining due to increase in albedo effect.
b) Warming has heated up the land masses in northern and southern hemispheres than the
oceans.
c) Warming is more on the northern hemisphere than the tropics & southern hemisphere.
d) Warming is more around the equatorial region and is not so in the northern or southern
hemispheres.
6. A city planning commissioner consults with climate scientists to assess the impact of sea level
rise on strategic infrastructure projects. The scientists discuss several climate model projections
and indicate sea level rise has a fundamental relationship to GHG emissions, regardless of a
specific warming scenario. How should the scientists describe this relationship?
a) Sea level rise lags GHG emissions.
b) Sea level rise will cease once global emissions peak.
c) Sea level rises in response to ocean acidification.
d) Sea level rises proportionally faster than GHG emissions.
7. A senior sustainability consultant at an African think tank explains the complexities of different
Earth science systems to a group of ESG practitioners as part of the think tank’s continuing
education program. Which of the following statements by the sustainability consultant accurately
describes the Earth’s greenhouse effect?
a) A human-driven process in which the main contributor is the decrease in the albedo effect.
b) A natural process in which the Earth’s oceans absorb the majority of non-reflected incoming
solar energy.
c) A natural process in which the Earth reflects three-quarters of incoming solar energy back
into space.
d) A human-driven process that is the main contributor for half of the sea-level rise in the past
200 years.
8. A climate scientist develops a presentation on modern climate change for a group of
policymakers. What observation does the scientist include in the presentation that provides
evidence of human attribution to current climate change?
a) Atmospheric CO2 with isotopes consistent with fossil fuel emissions have increased since
the mid-20th century.
b) In the past 100 years, the atmospheric lifetime of CO2 attributed to energy use increased.
c) In the past 200 years, CO2 is responsible for most negative radiative forcing.
d) Glacial ice records indicate atmospheric CO2 increased by 135 parts per million since the
Industrial Revolution.
9. Proxy that truly indicate climate variation for a time period older than any of the recorded
measurements
a) By measuring the carbon dioxide dissolved in the sediments at the bottom of the oceans.
b) Speleothem indicating the climate change over past many hundred years.
c) By measuring the reflection property of north polar ice caps indicating the change in climate
for past thousands of years.
d) By counting rings on the coral seashells found in tropical regions indicating change in
climate over past couple of centuries.
3
Sustainability and Climate Risk Exam, 2023
, 10. The risk team for a multinational company, that operates and franchises hotel and timeshare
properties, prepares talking points for an upcoming business continuity plan meeting. A key area
for discussion are the risks that can impact the company’s financial and reputational stability. The
team recommends the company conduct climate-related scenario analysis and provides examples
of scenarios and their use. Which of the following is correct for the team to include as part of the
talking points?
a) A company conducting scenario analysis should focus on either physical or transition risks
to avoid inconsistent outcomes.
b) A company can internally develop its models and scenarios or make use of existing publicly
available scenarios.
c) Scenario analysis allows a company to better understand its past performance by
conducting a lookback analysis.
d) Scenario analysis should use a limited set of assumptions and constraints to reduce the
risk of generalized scenario results.
11. A utility company on the Gulf of Mexico reviews a 20-year capital plan. During the review, the
risk management team expresses concern about physical climate impacts on the utility's capital
and operational expenditures. To further understand these risks, the team asks an in-house
scientist to explain how increasing global atmospheric concentrations of water vapor may contribute
to increasing climate risks for the utility. How should the scientist describe the climate impact of
additional water vapor in the atmosphere?
a) The Gulf Stream current will accelerate.
b) Heat waves in arid areas will moderate.
c) Evaporation will increase on all terrestrial areas.
d) Floods and droughts will become more intense.
12. A national science policy advisor reviews IPCC reports throughout the past several decades to
inform government communication on climate change. The advisor creates summaries of each
report’s statements on attribution of modern warming. How should the advisor describe a
conclusion on modern warming attribution from the 2021 IPCC Assessment Report (AR6)?
a) Humans are responsible for 100% of modern warming.
b) GHGs and natural variability equally contribute to modern warming.
c) Most modern warming is possibly due to anthropogenic activity.
d) The Earth has likely warmed since the second half of the 1800s.
13. A global think tank works with a small island nation to assess the cost-effectiveness of
geoengineering technologies that could mitigate global emissions. Upon completion of the
assessment, the think tank finds certain geoengineering techniques may have serious
consequences. Which of the following is a potential negative consequence of implementing a
geoengineering technique?
a) Exponential increase of carbon abatement cost per decade.
b) Changes in global precipitation patterns.
c) Carbon dioxide removal from the atmosphere becomes infeasible.
d) Linear rise in costs each time geoengineering is used.
14. An oil and gas company with sizable GHG emissions operates in all parts of the world. The
company commissions a team of environmental consultants that specialize in climate risk to explore
options for minimizing GHG emissions from company operations. The consultants present several
datasets and highlight that 93% of heat trapped by GHGs heats one particular portion of the Earth.
Which part of the Earth absorbs most heat trapped by GHGs?
4
Sustainability and Climate Risk Exam, 2023
QUESTION BANK
INDEX
Chapter Pg No.
I FOUNDATIONS OF CLIMATE CHANGE: WHAT IS CLIMATE CHANGE (19 2
Questions)
II SUSTAINABILITY (19 Questions) 8
III CLIMATE CHANGE RISK (21 Questions) 13
IV SUSTAINABILITY AND CLIMATE POLICY, CULTURE AND 19
GOVERNANCE (21 Questions)
V GREEN AND SUSTAINABLE FINANCE: MARKETS AND INSTRUMENTS 25
(21 Questions)
VI CLIMATE RISK MEASUREMENT AND MANAGEMENT (22 Questions) 32
VII CLIMATE MODELS AND SCENARIO ANALYSIS (20 Questions) 39
VIII NET ZERO (13 Questions) 45
1
Sustainability and Climate Risk Exam, 2023
,Chapter 1: FOUNDATIONS OF CLIMATE CHANGE: WHAT IS CLIMATE CHANGE
1. A major good production factory uses abundant fresh water for its boiler. It asks one of its interns
to prepare a report of the impact the water vapor emissions due to human activities on its
abundance surrounding environment. This is what the intern reports:
a) Water vapor directly emissions from human activities contribute essentially nothing to its
atmospheric abundance.
b) Water vapor released by humans has direct impact on the temperature of the surroundings.
c) Water vapor released by humans increases the chance of precipitation and causes risk of
floods in surroundings.
d) Water vapor emissions from human activities contribute heavily to the surrounding
temperature.
2. A small boat making company undertakes an internal study to assess the impact of greenhouse
gas emissions on the climate change. They study multiple papers and find out an interesting fact
about greenhouse gases. Which is the below option correctly mentioning the fact about greenhouse
gases?
a) Majority of the greenhouse gases can be stored and used as a fuel for cooking and other
industrial purposes.
b) Most of the greenhouse gases remain trapped within the ground and keep leaking into the
atmosphere at a slower pace.
c) Majority of the greenhouse gas is utilized for heating up the oceans than the landmasses.
d) Greenhouse gases can be neutralized using oxidation processes like CCUS within short
period of time.
3. A large insurance company in South America expands use of climate scenario analysis. The
company used RCPs in previous scenario analyses but now hires an actuary with climate expertise
to incorporate SSPs in this process. How can the actuary advise the insurance company to use
SSPs going forward?
a) Combine SSPs with different RCPs to assess climate policy options.
b) Eventually replace SSPs with RCPs by integrating underlying data assumptions.
c) Demonstrate how SSP and RCP trajectories typically show contradictory emissions trend
trajectories.
d) Use SSPs to provide alternative emissions pathways to RCPs.
4 In preparation for an upcoming global climate conference, organizers develop climate science
training materials for business executives. How should the training material compare anthropogenic
and natural climate changes?
a) Human activities slowed water vapor feedback, whereas natural climate changes do not
alter water vapor balance.
b) Human activities caused temperature changes greater than any previous natural
temperature changes.
c) Human-induced warming currently exhibits a nonlinear relationship with global CO2 levels,
whereas natural warming shows a linear relationship.
d) It is still to be assessed and concluded if human activities any impact on temperature
change.
2
Sustainability and Climate Risk Exam, 2023
,5. A climate analyst goes through a scientific journal to study the patterns of global temperature
change and comes across a very interesting point. Which one of the below points is found to be
true?
a) Warming has been declining due to increase in albedo effect.
b) Warming has heated up the land masses in northern and southern hemispheres than the
oceans.
c) Warming is more on the northern hemisphere than the tropics & southern hemisphere.
d) Warming is more around the equatorial region and is not so in the northern or southern
hemispheres.
6. A city planning commissioner consults with climate scientists to assess the impact of sea level
rise on strategic infrastructure projects. The scientists discuss several climate model projections
and indicate sea level rise has a fundamental relationship to GHG emissions, regardless of a
specific warming scenario. How should the scientists describe this relationship?
a) Sea level rise lags GHG emissions.
b) Sea level rise will cease once global emissions peak.
c) Sea level rises in response to ocean acidification.
d) Sea level rises proportionally faster than GHG emissions.
7. A senior sustainability consultant at an African think tank explains the complexities of different
Earth science systems to a group of ESG practitioners as part of the think tank’s continuing
education program. Which of the following statements by the sustainability consultant accurately
describes the Earth’s greenhouse effect?
a) A human-driven process in which the main contributor is the decrease in the albedo effect.
b) A natural process in which the Earth’s oceans absorb the majority of non-reflected incoming
solar energy.
c) A natural process in which the Earth reflects three-quarters of incoming solar energy back
into space.
d) A human-driven process that is the main contributor for half of the sea-level rise in the past
200 years.
8. A climate scientist develops a presentation on modern climate change for a group of
policymakers. What observation does the scientist include in the presentation that provides
evidence of human attribution to current climate change?
a) Atmospheric CO2 with isotopes consistent with fossil fuel emissions have increased since
the mid-20th century.
b) In the past 100 years, the atmospheric lifetime of CO2 attributed to energy use increased.
c) In the past 200 years, CO2 is responsible for most negative radiative forcing.
d) Glacial ice records indicate atmospheric CO2 increased by 135 parts per million since the
Industrial Revolution.
9. Proxy that truly indicate climate variation for a time period older than any of the recorded
measurements
a) By measuring the carbon dioxide dissolved in the sediments at the bottom of the oceans.
b) Speleothem indicating the climate change over past many hundred years.
c) By measuring the reflection property of north polar ice caps indicating the change in climate
for past thousands of years.
d) By counting rings on the coral seashells found in tropical regions indicating change in
climate over past couple of centuries.
3
Sustainability and Climate Risk Exam, 2023
, 10. The risk team for a multinational company, that operates and franchises hotel and timeshare
properties, prepares talking points for an upcoming business continuity plan meeting. A key area
for discussion are the risks that can impact the company’s financial and reputational stability. The
team recommends the company conduct climate-related scenario analysis and provides examples
of scenarios and their use. Which of the following is correct for the team to include as part of the
talking points?
a) A company conducting scenario analysis should focus on either physical or transition risks
to avoid inconsistent outcomes.
b) A company can internally develop its models and scenarios or make use of existing publicly
available scenarios.
c) Scenario analysis allows a company to better understand its past performance by
conducting a lookback analysis.
d) Scenario analysis should use a limited set of assumptions and constraints to reduce the
risk of generalized scenario results.
11. A utility company on the Gulf of Mexico reviews a 20-year capital plan. During the review, the
risk management team expresses concern about physical climate impacts on the utility's capital
and operational expenditures. To further understand these risks, the team asks an in-house
scientist to explain how increasing global atmospheric concentrations of water vapor may contribute
to increasing climate risks for the utility. How should the scientist describe the climate impact of
additional water vapor in the atmosphere?
a) The Gulf Stream current will accelerate.
b) Heat waves in arid areas will moderate.
c) Evaporation will increase on all terrestrial areas.
d) Floods and droughts will become more intense.
12. A national science policy advisor reviews IPCC reports throughout the past several decades to
inform government communication on climate change. The advisor creates summaries of each
report’s statements on attribution of modern warming. How should the advisor describe a
conclusion on modern warming attribution from the 2021 IPCC Assessment Report (AR6)?
a) Humans are responsible for 100% of modern warming.
b) GHGs and natural variability equally contribute to modern warming.
c) Most modern warming is possibly due to anthropogenic activity.
d) The Earth has likely warmed since the second half of the 1800s.
13. A global think tank works with a small island nation to assess the cost-effectiveness of
geoengineering technologies that could mitigate global emissions. Upon completion of the
assessment, the think tank finds certain geoengineering techniques may have serious
consequences. Which of the following is a potential negative consequence of implementing a
geoengineering technique?
a) Exponential increase of carbon abatement cost per decade.
b) Changes in global precipitation patterns.
c) Carbon dioxide removal from the atmosphere becomes infeasible.
d) Linear rise in costs each time geoengineering is used.
14. An oil and gas company with sizable GHG emissions operates in all parts of the world. The
company commissions a team of environmental consultants that specialize in climate risk to explore
options for minimizing GHG emissions from company operations. The consultants present several
datasets and highlight that 93% of heat trapped by GHGs heats one particular portion of the Earth.
Which part of the Earth absorbs most heat trapped by GHGs?
4
Sustainability and Climate Risk Exam, 2023
