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Global Supply Chain ESG Compliance
Understanding ESG compliance is essential to achieve antifragility and supply chain resiliency. In this guide we explain key regulations and solutions to prevent disruptions.
Uyghur Forced Labor Prevention Act
German Supply Chain Due Diligence Act
Corporate Sustainability Due Diligence Directive
Understanding Compliance
Essential Strategies for Mastering Global Supply Chain ESG Compliance
Regulatory compliance around the Uyghur Forced Labor Prevention Act, the German Supply Chain Due Diligence Act, the Corporate Sustainability Due Diligence Directive, PFAS and other regulations all continue to drive the requirement for global companies to increase supply chain sourcing, production and operational transparency. Understand how to best meet upcoming compliance deadlines and which supply chain best practices to use.
Uyghur Forced Labor Prevention Act
The U.S. Uyghur Forced Labor Prevention Act combats forced labor and human rights violations in China's Xinjiang Uyghur Autonomous Region. UFLPA underscores the importance of ethical sourcing and corporate responsibility in global supply chains, to prevent goods produced under such noncompliant conditions from entering the U.S. market.
Key provisions
- Prohibition of imports: The act presumes that goods produced in Xinjiang involve forced labor and are thus banned from U.S. import unless proven otherwise.
- Due diligence for companies: Businesses importing from China must demonstrate that their supply chains are free from forced labor, ensuring ethical sourcing.
- Government enforcement: U.S. authorities, including the Department of Homeland Security and Customs and Border Protection, are tasked with stringent enforcement of this act.
Who does it affect?
- Global businesses with sites, parts, and products coming out of China: Particularly those linked to the Xinjiang region, that must now ensure compliance with stringent labor standards.
- Human rights groups: Advocates for ethical labor practices who support the implementation and enforcement of the act.
- Consumers: Potentially experiencing changes in product availability and pricing due to adjusted import practices.
Enactment and best practices
Gain best practices on how to best protect your supply chain and meet UFPLA compliance. Understand what warning signs of forced labor to look for across all supply chain tiers. Talk to an expert.
Resilinc’s solutions
- UFLPA AI + Supplier Validation with Multi-Tier Mapping
- UFLPA AI Monitoring with EventWatchAI
- UFLPA 360° Supplier Assessments with Multi-Tier Mapping
- Resiliency Scoring with RiskShield
- UFLPA risk mitigation playbooks, compliance data collection, and supplier collaboration in one platform
- UFLPA compliance and forced labor identification via joint Resilinc + Kharon partnership
PFAS Legislation
Per- and Polyfluoroalkyl Substances (PFAS) are everywhere—in consumer products, building materials, industrial parts and components, and more. Used primarily for their resistance to heat, water, and oil, PFAS raise significant health and environmental concerns. Increased legislative global actions around these substances aim to reduce the exposure risks associated with PFAS. As of May 8, 2025, any amount of PFAS that is manufactured (or imported) must be reported to the U.S. Environmental Protection Agency under TSCA section 8(a)(7). The move signifies a broader shift towards more sustainable and safe chemical management, greater environmental responsibility, and public health protection.
Key provisions
- PFAS alternative sourcing: Regions such as the U.S. and European Union are increasingly regulating or finding alternatives to PFAS for their product manufacturing.
- Environmental Standards: Setting limits on PFAS in drinking water, soil, and air, and enforcing cleanup of contaminated sites.
- Reporting Requirements: Mandating industries to report PFAS usage and release, increasing transparency and data availability for regulatory actions.
Who does it affect?
- Manufacturers using PFAS: Companies in industries such as textiles, paper products, firefighting foams, and more are directly impacted by these regulations.
- Environmental agencies and groups: The U.S. EPA and other regulatory bodies actively involved in the monitoring, research and enforcement of PFAS regulations.
- General public: As potential consumers of PFAS-containing products and inhabitants of environments where PFAS contamination may occur.
Adapting to PFAS restrictions
Gain a broader overview of PFAS regulations, litigations and impacted industries. Understand what sustainable PFAS alternatives are available to you, and what simple steps to take to ensure compliance today. Talk to an expert.
Resilinc’s solutions
- PFAS AI + Supplier Validation with Multi-Tier Mapping
- PFAS AI Monitoring with EventWatchAI
- PFAS 360° Supplier Assessments with Multi-Tier Mapping
- Resiliency Scoring with RiskShield
- PFAS Risk mitigation playbooks, compliance data collection, and supplier collaboration in one platform
German Supply Chain Due Diligence Act
The German Supply Chain Due Diligence Act enforces human rights and environmental protection in global trade. Greater requirements, such as requiring companies to sign an ESG code of conduct, further prevents noncompliance issues from reaching further down in the supply chain. By holding companies accountable for their supply chains, the Act promotes transparency, reduces the risk of exploitation, and encourages sustainable business practices to mitigate supply chain ESG risks.
Key provisions
- Due diligence requirements: Companies are required to implement supply chain due diligence processes to mitigate human rights violations and environmental harm.
- Scope of application: Initially, it applies to companies with more than 3,000 employees in Germany, expanding to include companies with more than 1,000 employees from 2024 onwards.
- Reporting obligations: Companies must report annually on their due diligence efforts and the measures taken to address risks and impacts.
Who does it affect?
- Large companies active in Germany: Primarily targeting large multinational corporations with significant operations in Germany.
- Global suppliers and business partners: Indirectly affects global suppliers and business partners that must comply with the standards set by these companies.
- Consumers and investors: Indirectly affects those who are increasingly seeking ethically responsible business practices.
Enactment and best practices
Learn more in our in-depth essential guide about global ESG disruption data, ESG risks, and informative best practices to protect your supply chain and start applying these insights today. Talk to an expert.
Resilinc’s solutions
- AI + Supplier Validation with Multi-Tier Mapping
- AI Monitoring with EventWatchAI
- 360° Supplier Assessments with Multi-Tier Mapping
- Resiliency Scoring with RiskShield
- Risk mitigation playbooks, compliance data collection, and supplier collaboration in one platform
Corporate Sustainability Due Diligence Directive
The Corporate Sustainability Due Diligence Directive aims to ensure that companies operating within the EU integrate human rights and environmental considerations into their operations and value chains. Newly revised requirements of the CSDDD greatly reduce (from the original agreement) the number of companies that will have to comply. As of March 2024, the mandates only apply to companies doing business in Europe with more than 1,000 employees and annual turnover of more than €450 million. While impacts can be expected over the next 5 years, companies with global trade and supply chain practices can continue to adopt CSDDD guidelines to achieve more ethical and sustainable business models.
Key provisions
- Due diligence obligations: Companies are accountable for potential adverse impacts on human rights and the environment in their supply chains.
- Scope and application: The newly updated directive targets large companies and high-risk sectors, with a specific focus on companies that have a significant impact on the environment and human rights.
- Compliance and enforcement: Companies must report on their due diligence activities, and member states are tasked with ensuring compliance, otherwise they may face non-compliance penalties.
Who does it affect?
- Companies with 5,000 employees and €1,500 million turnover will be impacted in 3 years.
- Companies with 3,000 employees and €900 million turnover will be impacted in 4 years.
- Companies with 1,000 employees and €450 million turnover will be impacted in 5 years.
Enactment and best practices
Learn more about the CSDDD and other significant legislation impacting global companies and their suppliers. Gain insight into due diligence measures and proven strategies you can take to mitigate risk and meet compliance. Talk to an expert.
Resilinc’s solutions
- AI + Supplier Validation with Multi-Tier Mapping
- AI Monitoring with EventWatchAI
- 360° Supplier Assessments with Multi-Tier Mapping
- Resiliency Scoring with RiskShield
- Risk mitigation playbooks, compliance data collection, and supplier collaboration in one platform
National Defense Authorization Act
Sections 857 and 889 of the National Defense Authorization Act are designed to enhance the United States' security and independence in procurement. Section 857 focuses on the strategic sourcing of rare earth elements and other critical materials like germanium, cobalt, lithium, and gallium, ensuring the defense sector's autonomy from unreliable foreign sources. Section 889, known as the Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment, aims to safeguard national security by restricting government contracts with entities using covered telecommunications equipment or services linked to certain companies affiliated with China. This regulation is to prevent cyber-attacks and the exfiltration of information and intellectual property, thus protecting U.S. government and industry.
Key provisions
- Strategic sourcing: Mandates the Department of Defense (DoD) to prioritize the procurement of rare earth elements, critical minerals, and materials from domestic or allied sources.
- Supply chain security: Emphasizes the importance of securing a stable and reliable supply chain for rare earth minerals and materials used in defense applications. It also includes securing telecommunications equipment, preventing the use of items that could compromise national security, particularly those linked to certain companies affiliated with China.
- Risk mitigation: Requires the DoD to assess and mitigate risks associated with the reliance on foreign sources for strategic materials and telecommunications technology, ensuring defense and communication systems are safeguarded against potential cyber threats and foreign interference.
Who does it affect?
- U.S. Department of Defense: As the primary entity responsible for implementing these procurement strategies, the DoD also enforces restrictions on the use of telecommunications equipment and services that could pose security risks, specifically those linked to certain Chinese companies.
- Domestic and allied suppliers: Companies that mine, process, or supply rare earth elements and strategic materials stand to benefit from increased demand. Telecommunications equipment suppliers that meet security criteria set by the DoD will also see opportunities as the need for secure and compliant technology solutions grows.
- Global supply chain entities: Particularly those in countries not allied with the U.S., which might face reduced demand for these materials. Entities providing covered telecommunications equipment and services may also face restrictions or exclusions from U.S. government contracts, affecting their business with the U.S. government.
Enactment and best practices
The enactment of Section 857 and 889 under the 2023 National Defense Authorization Act is a significant move towards enhancing national security and economic independence in critical areas of defense. By shifting the focus to domestic and allied sources for rare earth elements and strategic materials, this legislation aims to reduce potential vulnerabilities in the defense supply chain. This shift not only has implications for the U.S. defense sector but also impacts global trade dynamics and the strategic materials market. Talk to an expert.
Resilinc’s solutions
- AI + Supplier Validation with Multi-Tier Mapping
- AI Monitoring with EventWatchAI
- 360° Supplier Assessments with Multi-Tier Mapping
- Resiliency Scoring with RiskShield
- Risk mitigation playbooks, compliance data collection, and supplier collaboration in one platform
