Every year-end all the listed companies on European Union (EU) regulated markets prepare their Annual Financial Reports (AFRs) for submission to national regulators. The familiar process of drafting, reviewing, designing, and publishing has now been redefined by the European Single Electronic Format (ESEF) mandate.
What used to be a final step for formatting and submission is now a technical, regulatory, and design challenge rolled into one. AFRs must be prepared in Inline XBRL (iXBRL), tagged in line with the latest ESEF taxonomy, validated against European Securities and Markets Authority (ESMA) rules, and still look exactly as your brand demands. And 2025 is not making things easier. More granular block tagging, updated anchoring requirements, and stricter validation rules mean the margin for error is smaller than ever.
That is where the latest ESEF tagging techniques come in and why a future-ready platform like IRIS CARBON® makes the difference between just compliant and confidently compliant.
What is ESEF Tagging?
ESEF tagging is the process of encoding financial data within an AFR using a digital language called iXBRL, in line with the ESEF requirements. This approach ensures the report remains both human-readable and machine-readable, improving transparency, accessibility, and comparability of financial information among companies listed on EU regulated markets and it has been mandatory for AFRs since January 1, 2020.
Under ESEF, issuers must:
- Prepare AFRs in XHTML format.
- Integrate iXBRL tags on critical financial statement items.
- Apply the ESEF taxonomy (IFRS taxonomy-based).
- Anchor any custom components to the nearest applicable standard component.
In simple words, ESEF tagging is about making your financial information machine-readable, comparable, and regulator-ready, without compromising on the human-readable layout of your report.
Why It Matters and What’s New in 2025
ESEF tagging matters because ESEF reporting demands design and technical parts rolled into one. Organizations must produce digital reports that satisfy rigorous technical standards such as iXBRL tagging, alignment with the latest ESEF taxonomy, and adherence to ESMA validation rules, all without sacrificing the polished look investors and stakeholders expect from branded documents.
Here are the key changes for 2025:
- Latest ESEF taxonomy required
The 2025 ESEF mandate enforces the use of the updated taxonomy, including new elements to be tagged especially for notes, dividends, and expanded block-tagging. - Increased tagging granularity
2025 brings more granular block-tagging of notes and narrative disclosures. Reports must apply multiple layers of block tags in notes, sometimes anchoring disclosure extensions when the standard taxonomy does not directly fit. - Updated anchoring requirements
In 2025, extension elements must be anchored more precisely in the taxonomy, requiring technical understanding of XBRL linkbases. This step is essential for validation and reduces the margin for subjective mapping. - Stricter validation rules
The new reporting and validation protocols, including requirements for XBRL Calculations 1.1 and mandatory tags for certain elements, mean errors that previously slipped through are now flagged, and companies face higher compliance pressure.
ESMA 2024 Enforcement and Regulatory Highlights
The European Securities and Markets Authority (ESMA) continues to stress strict compliance with ESEF rules. Key points for issuers and preparers include:
- No financial data as images
Only branding or design elements can be images. Financial information must be tagged as text for machine readability. - ESEF format is the official AFR
Only the ESEF version meets regulatory requirements. Other formats like PDFs must include disclaimers clarifying they are not the official report. - Avoid discrepancies between ESEF and PDF reports
Inconsistencies can lead to legal risks. Issuers should have procedures to prevent conflicting information. - Publish on time and in alignment
ESEF AFRs must be filed within four months of year-end. Other formats published earlier need justified reasons and must align with filings on official platforms. - Auditor’s opinion must be available
Where required, the audit report should be public when the ESEF AFR is published.
Why This Matters: ESMA’s enforcement focus means issuers must ensure accuracy, consistency, and timely publication. A platform like IRIS CARBON® can help automate validation, control versions, and streamline compliance with these requirements.
Latest ESEF Tagging Techniques to Know in 2025
1. Advanced Block Tagging for Notes
More granular tagging of individual notes is now the norm, not just section-level tagging. This improves transparency, supports investor analysis, and aligns with ESMA’s push for structured disclosures.
2. Precision Anchoring for Extensions
Custom disclosures require two-step anchoring:
- Primary anchor to the most specific related taxonomy element
- Secondary anchor to a broader category for context
3. Rolling Forward Taxonomy Mapping
The latest best practice is to carry forward prior-year tags but re-map them to the updated taxonomy to avoid deprecated elements and validation errors.
4. Real-Time Validation During Tagging
Immediate feedback on tagging, anchoring, and calculation inconsistencies prevents end-stage errors and filing delays.
5. Multi-Language Tagging Compliance
For multilingual AFRs, tags must have language-specific labels, ensuring complete compliance without redundant tagging work.
ESEF Tagging: Traditional vs. Latest Techniques
| Feature | Traditional ESEF Tagging | Latest ESEF Tagging (2025) |
| Tagging Approach | Section-level block tagging | Granular block tagging for each note |
| Extensions | Single anchor for custom elements | Two-step anchoring (specific plus broader) |
| Taxonomy Updates | Manual re-tagging each year | Roll-forward mapping with taxonomy updates |
| Validation | End-of-process checks | Real-time validation during tagging |
| Language Handling | Single-language labels | Multi-language labels for multilingual AFRs |
| Workflow | Siloed design, tagging, and review | Integrated data, tagging, and design workflow |
From Tagging to Design: How IRIS CARBON® Simplifies the ESEF Journey
Unlike tools focused solely on compliance, IRIS CARBON® unites data, disclosure, and design into a smooth, end-to-end workflow:
- Built-in XBRL Tagging Module
Automates last-mile tagging, maps to the latest taxonomy, and flags deprecated elements. - Real-Time Validation
Intelligent suggestions for anchors, continuous validation to catch issues early. - InDesign Integration
Work seamlessly with designers to keep AFRs on-brand without sacrificing compliance. - Role-Based Collaborative Workflow
Finance, compliance, and design teams collaborate with defined access controls for transparency. - Data-Centric Reporting for Accuracy
Centralized data ensures tagged values match audited figures, reducing errors.
Why It Matters Now
ESEF compliance has evolved from simply following rules to delivering greater value beyond compliance. Regulators, investors, and analysts now expect granular, accurate, and comparable digital disclosures.
With IRIS CARBON®, you:
- Boost internal collaboration across finance, design, and compliance teams.
- Reduce manual effort and version-control chaos.
- Foster transparency with role-based access and audit trails.
- Deliver auditor-ready AFRs that are both compliant and beautifully designed.
Conclusion: Compliance Without Complexity
The evolution of ESEF tagging, from basic block tagging to advanced anchoring and real-time validation, is a sign that corporate reporting is heading data-first, digitally compliant, and design-conscious. If 2020 was about meeting the mandate, 2025 is about optimizing your ESEF process for speed, accuracy, and brand consistency.
IRIS CARBON® does not just help you meet these requirements; it enables you to master them, creating a reporting process that is secure, accurate, and future-proof.
