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CIPS L4M4 Exam - Topic 3 Question 50 Discussion

A chief procurement officer (CPO) reviews a tender process and recommendation before making the final submission to the board of directors for approval. The CPO notices that the evaluation team assessed technical and financial capacity but did not conduct an assessment and due diligence on the supplier's environmental, social, governance, anti-bribery, and corruption practices and processes. The CPO has decided to forward the report to the board for approval and seek reassurance from the supplier at a later date once the contract has been signed. Was the CPO's decision the correct one?
B) No, evaluation of suppliers' compliance is important to protect the buying organisation against reputational risk and other losses
A) Yes, because only financial and technical capacity matters in the evaluation of strategic contracts
C) Yes, as compliance to environmental, social and governance will result in an unjustified increase in supplier costs
D) No, because a supplier's practices become confidential once a contract has been signed

CIPS L4M4 Exam - Topic 3 Question 50 Discussion

Actual exam question for CIPS's L4M4 exam
Question #: 50
Topic #: 3
[All L4M4 Questions]

A chief procurement officer (CPO) reviews a tender process and recommendation before making the final submission to the board of directors for approval. The CPO notices that the evaluation team assessed technical and financial capacity but did not conduct an assessment and due diligence on the supplier's environmental, social, governance, anti-bribery, and corruption practices and processes. The CPO has decided to forward the report to the board for approval and seek reassurance from the supplier at a later date once the contract has been signed. Was the CPO's decision the correct one?

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Suggested Answer: B

Ethical and responsible sourcing requires that environmental, social, governance, anti-bribery and corruption (ESG/ABC) considerations are assessed before contract award, not after. Failure to conduct due diligence exposes the buying organisation to reputational damage, legal sanctions, financial losses, and supply chain disruption. Seeking reassurance post-contract removes leverage and weakens governance controls. CIPS guidance stresses that supplier evaluation must be holistic, covering technical, financial, and ethical compliance to ensure risks are identified and mitigated early. Strategic contracts, in particular, demand robust due diligence to protect organisational integrity and stakeholder trust.


by Gilberto at Jun 21, 2026, 11:16 PM

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Jettie
12 hours ago
I feel like option B makes the most sense since protecting the organization from risks is crucial, but I wonder if the CPO had any other reasons for their decision.
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Sommer
6 days ago
I’m not entirely sure, but I think we practiced a case where ignoring compliance led to major reputational damage for a company.
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Caprice
11 days ago
I remember discussing the importance of due diligence in supplier evaluations, especially regarding ESG factors. It seems risky to skip that step.
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