Still using a paper map while everyone else has GPS?
We note, once again, that the EU’s regulatory framework for digital financial reporting reveals a fundamental misalignment between modern data-driven needs and the antiquated publication methods that the EU requires. ESMA continues to be obliged to produce thousand-page PDF documents containing static tables that essentially replicate information already embedded within the IFRS taxonomy itself. That’s information that could be dynamically queried, analyzed, and validated through proper digital tooling.
A truly modern regulatory framework would publish machine-readable schemas, provide interactive online documentation, and offer API access to regulatory requirements that automatically sync with taxonomy updates.
Instead of expecting stakeholders to parse dense legal documents to understand which elements are mandatory, the European Commission should embrace the same digital-first principles they’re imposing on issuers. The irony is stark: while requiring companies to digitise their financial reporting through XBRL, the EU continues to communicate these requirements through fundamentally analogue methods that belong to the pre-digital era.
We have huge sympathy for the ESMA team – the legislative process is not of their making. It isn’t the work of DG FISMA, either, the directorate for Financial Markets within the EC. It is a “machinery of government” problem. That said, it’s high time that policy makers consider modernisation in this field.
