Cultural narratives and the limits of European Union greenwashing policies

Abstract

The European directive on greenwashing in 2024 represents a significant regulatory shift aimed at increasing transparency in sustainability marketing by restricting the use of vague environmental claims unless backed by official certification. However, its strategic effectiveness hinges on a deeper challenge: consumer perceptions of sustainability are not solely shaped by regulations but by underlying cultural models that influence purchasing behavior.This chapter takes a strategic approach to understanding how cultural narratives shape market responses to sustainability regulations. through 21 in-depth interviews in Spain, we identify two dominant cultural models that define how consumers perceive green products. Following the first model (technology-driven) consumers equate environmental sustainability with innovation, efficiency, and cutting-edge advancements. Consumers who adopt this model favor hybrid cars, smart home systems, and energy-efficient appliances as the hallmark of sustainability. Second, with the nature-driven model framework, consumers associate environmental sustainability to tradition, simplicity, and organic production. This model drives consumer preferences for handmade goods, locally sourced foods, and natural materials as symbols of environmentally responsible choices. While these two models may appear contradictory, consumers seamlessly integrate elements from both without cognitive conflict. By unveiling these cultural models, this chapter provides actionable strategic insights for business and policymakers. Companies can align their branding, product development, and marketing strategies with ingrained cultural narratives to enhance consumer trust and market positioning. Additionally, it offers a strategic lens for policymakers to design more effective sustainability regulations that go beyond enforcement and address behavioral and perceptual drivers of green consumption.

The European directive on greenwashing in 2024 represents a significant regulatory shift aimed at increasing transparency in sustainability marketing by restricting the use of vague environmental claims unless backed by official certification. However, its strategic effectiveness hinges on a deeper challenge: consumer perceptions of sustainability are not solely shaped by regulations but by underlying cultural models that influence purchasing behavior.This chapter takes a strategic approach to understanding how cultural narratives shape market responses to sustainability regulations. through 21 in-depth interviews in Spain, we identify two dominant cultural models that define how consumers perceive green products. Following the first model (technology-driven) consumers equate environmental sustainability with innovation, efficiency, and cutting-edge advancements. Consumers who adopt this model favor hybrid cars, smart home systems, and energy-efficient appliances as the hallmark of sustainability. Second, with the nature-driven model framework, consumers associate environmental sustainability to tradition, simplicity, and organic production. This model drives consumer preferences for handmade goods, locally sourced foods, and natural materials as symbols of environmentally responsible choices. While these two models may appear contradictory, consumers seamlessly integrate elements from both without cognitive conflict. By unveiling these cultural models, this chapter provides actionable strategic insights for business and policymakers. Companies can align their branding, product development, and marketing strategies with ingrained cultural narratives to enhance consumer trust and market positioning. Additionally, it offers a strategic lens for policymakers to design more effective sustainability regulations that go beyond enforcement and address behavioral and perceptual drivers of green consumption.