The expansion of corporate groups and the concentration of decision-making power in parent companies have intensified concerns regarding parent company liability for harm arising from the activities of subsidiaries. This article examines the circumstances in which a parent company may be held liable, not through piercing the corporate veil, but on the basis of an independent breach of due diligence obligations. The central distinction between these two bases of liability is that veil-piercing exceptionally disregards the subsidiary’s separate legal personality, including in situations involving apparent agency or fraud on the law, whereas liability based on the duty of care preserves that separate personality and focuses on the parent company’s own conduct, such as policy-making, supervision, issuing instructions, or risk management. Using a comparative approach, the study analyzes English and French law. The findings show that, in English law, parent company liability has been considered not only through the doctrine of piercing the corporate veil but also through the duty of care, where the parent has assumed a role in directing, supervising, or managing risks associated with the subsidiary’s operations. By contrast, French law, through the Duty of Vigilance Law, has developed a legislative and preventive framework requiring the identification, assessment, prevention, and monitoring of risks arising from subsidiaries and supply chains. Iranian law lacks an independent framework governing parent company liability. Accordingly, a combined model drawing on the French legislative approach and the English judicial experience may provide a basis for developing parent company due diligence obligations in Iranian law.