EU financial watchdog highlights stricter corporate reporting oversight

The European Securities and Markets Authority (ESMA) on Thursday published its report on 2025 corporate reporting enforcement and regulatory activities, outlining how national regulators and ESMA supervised corporate reporting practices across the European Economic Area (EEA) during 2025.

The report provides an overview of enforcement actions and supervisory work related to financial reporting, sustainability reporting and digital reporting, while also assessing issuers’ compliance with ESMA’s 2024 European Common Enforcement Priorities (ECEP).

According to ESMA, financial reporting enforcement activities during 2025 continued to focus on promoting disclosures that are material, transparent, entity-specific and useful for decision-making.

The authority said that sustainability reporting marked a significant development during the year, as 2025 represented the first year of enforcement of the European Sustainability Reporting Standards (ESRS) for jurisdictions falling within the scope of the framework.

The report also highlighted the application of the ESMA Guidelines on Enforcement of Sustainability Information (GLESI) during the reporting period.

ESMA stated that digital reporting remained a supervisory priority, with regulators working to improve the quality, consistency and usability of marked-up financial information submitted under the European Single Electronic Format (ESEF) framework.

The authority explained that the report is addressed primarily to issuers, auditors and investors, providing practical observations drawn from enforcement experience aimed at strengthening the overall quality and transparency of corporate reporting.

The document also outlines enforcement activities undertaken in relation to ESEF digital reporting requirements, which continue to form part of the EU’s broader efforts to modernise and standardise corporate disclosures across European capital markets.

According to ESMA, the report seeks to support more effective reporting practices by sharing insights from supervisory reviews and regulatory experience across EEA jurisdictions.

The publication forms part of the regulator’s ongoing efforts to enhance transparency, comparability and reliability in corporate reporting throughout the European Union and wider EEA markets.