Social Impact & Stakeholder Engagement Flashcards

The International Finance Corporation (IFC) Performance Standards are MOST directly applicable to which type of projects?

Answer: Projects financed by development finance institutions or private sector lenders following Equator Principles

IFC Performance Standards apply to private sector projects financed by IFC or by financial institutions that have adopted the Equator Principles, particularly in emerging markets.

What is the key distinction between 'outputs' and 'outcomes' in a social impact measurement framework?

Answer: Outputs are countable products of activities; outcomes are changes in the condition of beneficiaries

Outputs are immediate, tangible results of activities (e.g., meals served), while outcomes are the actual changes experienced by people (e.g., reduction in food insecurity).

A manufacturing company sources cobalt from the Democratic Republic of Congo. Under responsible sourcing standards, what should the company do FIRST?

Answer: Conduct a conflict minerals risk assessment of its supply chain

The OECD Due Diligence Guidance for Responsible Mineral Supply Chains requires companies to first assess and map risks in their supply chain before taking further action.

Which approach to stakeholder engagement involves inviting affected communities to co-design social programs alongside the company?

Answer: Collaborate and partner

Collaboration and partnership represents a higher level of engagement where communities co-create programs, sharing decision-making authority with the company.

A CEP planner is assessing a company's diversity, equity, and inclusion (DEI) program. Which indicator best measures equity rather than equality?

Answer: Representation of underrepresented groups in senior leadership roles

Equity focuses on outcomes and representation for historically marginalized groups, while equality treats everyone the same regardless of different starting positions.

Which of the following describes the concept of 'social license to operate' (SLO)?

Answer: Ongoing community acceptance and approval of a company's operations

Social license to operate is the informal, ongoing acceptance granted by local communities and stakeholders based on trust, legitimacy, and credibility — distinct from legal permits.

When should a company conduct an 'enhanced social due diligence' rather than standard screening?

Answer: When operating in high-risk contexts such as conflict-affected areas or with vulnerable populations

Enhanced due diligence is triggered by elevated risk factors such as conflict-affected zones, operations involving indigenous peoples, or projects with potential for significant community displacement.