ESG ESG Stakeholder Engagement & Communication 2

Question 1

What does 'free, prior, and informed consent' (FPIC) require of companies?

Accepted Answer

Obtaining genuine consent from indigenous and local communities before proceeding with projects affecting their lands or rights

Answer

FPIC, a UN human rights standard, requires companies to seek authentic consent—not just consultation—from affected indigenous peoples before any project impacting their territories or rights.

Question 2

What is 'ESG investor relations' (ESG IR)?

Accepted Answer

The practice of communicating ESG strategy, performance, and risks specifically to the investment community

Answer

ESG IR involves proactively engaging institutional investors, analysts, and proxy advisors on ESG performance, ratings, and strategy to support informed investment and voting decisions.

Question 3

When communicating ESG targets publicly, which characteristic most protects against greenwashing claims?

Accepted Answer

Setting science-based, time-bound targets with clear interim milestones and public progress reporting

Answer

Specific, science-based targets with defined timelines and transparent progress reporting are most defensible against greenwashing allegations because they are verifiable and accountable.

Question 4

What is 'salient human rights issues' identification in stakeholder engagement?

Accepted Answer

Identifying the human rights risks most likely to result in the most severe harm to people through a company's activities

Answer

The UNGPs direct companies to prioritize 'salient' human rights issues—those presenting the greatest potential for severe, widespread, or irremediable harm to people.

Question 5

What is the recommended approach when ESG stakeholder feedback conflicts with management priorities?

Accepted Answer

Document the conflict, explain the company's position transparently in ESG disclosures, and set a timeline for review

Answer

Best practice requires acknowledging divergent stakeholder views, transparently explaining management's rationale for prioritization, and demonstrating ongoing responsiveness.

(ESG) Certified Environmental, Social, and Governance Consultant Practice Test

(ESG) Certified Environmental, Social, and Governance Consultant Practice Test

ESG ESG Stakeholder Engagement & Communication 2