CCEP Third-Party Risk Management 3

Question 1

What is the role of senior management and the board with respect to third-party risk management?

Accepted Answer

To provide governance oversight, set tone from the top, and ensure adequate TPRM resources

Answer

To personally conduct all vendor interviews and site visits

Answer

To individually approve every third-party vendor contract before execution

Answer

To perform day-to-day monitoring of all active third-party relationships

Question 2

What is 'Know Your Vendor' (KYV) and why is it significant in compliance?

Accepted Answer

A due diligence process for understanding a vendor's identity, ownership, and compliance risk profile

Answer

A marketing strategy for building long-term vendor loyalty and partnerships

Answer

A financial audit focused solely on reviewing vendor invoices and pricing

Answer

A regulatory requirement mandating on-site visits to every vendor location

Question 3

When a third party undergoes an acquisition and comes under new ownership, what should the compliance team do?

Accepted Answer

Conduct a reassessment of the third party under its new ownership to identify any new or changed risks

Answer

Assume the existing relationship and risk profile remain unchanged

Answer

Immediately terminate the contract as a precautionary measure

Answer

Automatically transfer all compliance obligations to the acquiring company

Question 4

Which of the following best describes a risk-based approach to third-party management?

Accepted Answer

Focusing more intensive due diligence and monitoring resources on higher-risk third parties

Answer

Applying the same level of due diligence and monitoring to all vendors equally

Answer

Outsourcing all compliance responsibilities entirely to the third parties themselves

Answer

Conducting formal due diligence only at initial onboarding and never thereafter

Question 5

Under the UK Bribery Act, what is the 'adequate procedures' defense available to companies facing corporate liability for third-party bribery?

Accepted Answer

Demonstrating the company had adequate anti-bribery procedures in place designed to prevent bribery

Answer

Proving the company had no knowledge whatsoever of the third party's corrupt actions

Answer

Showing that the third party was classified as an independent contractor rather than an agent

Answer

Providing evidence that the bribery occurred in a jurisdiction where it was not explicitly illegal

Question 6

What is a key best practice for maintaining an effective enterprise-wide third-party compliance program?

Accepted Answer

Maintaining a centralized registry of all third-party relationships with associated risk ratings and due diligence status

Answer

Performing due diligence exclusively at contract renewal milestones

Answer

Storing vendor compliance information in informal, undocumented internal systems

Answer

Limiting compliance oversight to the five largest vendors by annual contract spend

Question 7

Which of the following contractual provisions is most important for protecting a company's compliance interests in a third-party agreement?

Accepted Answer

A right-to-audit clause allowing the company to inspect the third party's compliance records and practices

Answer

A clause requiring the third party to use only the company's preferred software systems

Answer

A clause requiring the third party to maintain a minimum revenue threshold

Answer

A provision specifying the third party's preferred dispute resolution venue