10 free, exam-style Sustainability and Climate Risk (SCR) (GARP-SCR) practice questions with answers and
explanations. No signup required. Work through them below, then take the
full free GARP-SCR practice test to study every exam domain.
These 10 free GARP-SCR questions are organized by exam domain, so you can see how each part of the Sustainability and Climate Risk (SCR) blueprint is tested. Reveal the answer and explanation under each question.
Domain 1: Foundations of Climate Change
Question 1
An insurance company is reviewing claims data and notices that flood-related claims in coastal regions have increased by 40% over the past two decades. From a climate science perspective, which factor MOST likely contributes to this trend?
- Decreased precipitation globally
- Sea level rise combined with more intense precipitation events
- Reduced ocean temperatures causing more evaporation
- Changes in Earth's orbital patterns
Show answer & explanation
Correct answer: B - Sea level rise combined with more intense precipitation events
Domain 2: Sustainability
Question 2
An asset manager wants a disclosure framework that provides industry-specific, financially material information for investment decisions. The MOST appropriate framework is:
- GRI
- UN PRI
- CDP
- SASB
Show answer & explanation
Correct answer: D - SASB
Domain 3: Climate Change Risk
Question 3
An insurance company notices that claims from flood events have doubled over the past decade. This trend MOST directly reflects increased:
- Transition risk
- Acute physical risk
- Market risk from consumer behavior changes
- Technology disruption risk
Show answer & explanation
Correct answer: B - Acute physical risk
Domain 4: Sustainability and Climate Policy, Culture, and Governance
Question 4
Which GHG Protocol principle is MOST relevant when a company decides which emission sources to include or exclude from its inventory?
- Relevance - ensuring the inventory serves decision-making needs and reflects true emissions
- Consistency
- Accuracy
- Transparency
Show answer & explanation
Correct answer: A - Relevance - ensuring the inventory serves decision-making needs and reflects true emissions
Domain 5: Green and Sustainable Finance: Markets and Instruments
Question 5
A steel company issues a bond to fund the installation of electric arc furnaces to replace coal-fired blast furnaces. This bond is MOST likely classified as:
- A social bond
- A sustainability-linked bond
- A transition bond - financing decarbonization of a hard-to-abate sector
- A conventional corporate bond with no sustainability features
Show answer & explanation
Correct answer: C - A transition bond - financing decarbonization of a hard-to-abate sector
Domain 6: Climate Risk Measurement and Management
Question 6
A portfolio manager wants to reduce the portfolio's Total Carbon Emissions without changing the total portfolio value. The MOST effective approach is to:
- Increase the portfolio's total value
- Only invest in government bonds
- Ignore carbon metrics entirely
- Reallocate investments from companies with high emissions-to-EVIC ratios toward companies with low emissions-to-EVIC ratios
Show answer & explanation
Correct answer: D - Reallocate investments from companies with high emissions-to-EVIC ratios toward companies with low emissions-to-EVIC ratios
Domain 7: Climate Models and Scenario Analysis
Question 7
A risk analyst needs to project potential physical impacts of climate change in a specific river basin. The MOST appropriate modeling approach is:
- Using only an IAM
- Using only WACI calculations
- Downscaling GCM outputs using a Regional Climate Model to obtain local-level projections for the specific basin
- Using PCAF attribution methodology
Show answer & explanation
Correct answer: C - Downscaling GCM outputs using a Regional Climate Model to obtain local-level projections for the specific basin
Domain 8: Net Zero
Question 8
A company sets a target to reach net zero by 2050 but has no interim targets for 2025 or 2030. This target lacks credibility because:
- Without interim milestones, there is no mechanism to track progress, ensure accountability, or demonstrate that the company is on a credible decarbonization trajectory
- 2050 is too soon for net zero
- Interim targets are never required
- Only 2040 targets are considered credible
Show answer & explanation
Correct answer: A - Without interim milestones, there is no mechanism to track progress, ensure accountability, or demonstrate that the company is on a credible decarbonization trajectory
Domain 9: Nature and Biodiversity
Question 9
A pharmaceutical company depends on a plant species found only in a declining tropical rainforest. This illustrates:
- Only a supply chain issue
- Only a reputational concern
- No material financial risk
- Biodiversity-related financial risk - the company's value chain depends on an ecosystem service (genetic resources) that is threatened by habitat loss
Show answer & explanation
Correct answer: D - Biodiversity-related financial risk - the company's value chain depends on an ecosystem service (genetic resources) that is threatened by habitat loss
Domain 10: Climate Risk Disclosure and Carbon Footprinting
Question 10
A company develops a transition plan that includes ambitious science-based targets but has no governance mechanisms for board oversight or management accountability. This plan is deficient in:
- The Ambition principle
- The Action principle
- The Accountability principle - lacking governance structures to ensure delivery
- The Assessment element
Show answer & explanation
Correct answer: C - The Accountability principle - lacking governance structures to ensure delivery