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France adopts corporate duty of care law

The French Parliament yesterday adopted a long-awaited law establishing a duty of care obligation for parent and subcontracting companies...The vote comes after several years of mobilization of French civil society...Companies covered by the new law (it only applies to the largest French companies) have to assess and address adverse impacts on people and the planet under annual public vigilance plans.  This includes impacts linked to their own activities, those of companies under their control, and those of suppliers and subcontractors, with whom they have an established commercial relationship.  When companies default on these obligations, the law empowers victims and other concerned parties to bring the issue before a judge.  Judges can issue fines of up to 10 million euros if vigilance plans are absent, and 30 million euros if this absence results in otherwise preventable damages.  Although this law is a major achievement, French civil society organizations believe the law’s text could have been more ambitious.  The law’s scope is limited, only covering around 100 large companies...It is now essential that other countries follow France’s lead, in other words, binding legislation at national, European and international levels, to advance on much needed regulation for transnational corporations and their financiers...

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