59 JUL 2022 | WWW.LAWYER-MONTHLY.COM for companies and investors because of the potential impact of scandals on sales and on brand image. These concerns are now becoming real legal issues for companies that are required to be more cautious about the activities of their subsidiaries abroad. For example, in the US, since December and the establishment of the UFLPA law, companies are prevented from importing goods from China’s Xinjiang region unless the importer can clearly prove that the goods were produced free from forced labour or human rights abuses. Additionally, the EU Commission proposed in February 2022 an ambitious Directive that would impose on companies a duty of vigilance over subsidiaries and commercial partners in supply chains. Executives would be liable for breaches of duty. New national agencies with powers to investigate, sue and fine violations would also be established. The scope of the Directive would also be much broader than the precursory French act of 2017 because the obligations would apply to companies with at least 500 employees and 150 million euros in revenues and 250 employees and 40 million euros in revenues for companies in high-risk areas (textile, agriculture, oil, gas, etc.). Germany also adopted a similar regulation for companies with more than 3 000 employees that will enter into force on 1 January 2023. Any investment in Russia is also at risk because the broad sanctions adopted EXPERT INSIGHT Governance and social issues have long been public relations obstacles for companies and investors because of the potential impact of scandals on sales and on brand image.