<p>Religious traditions, as an integral part of China’s long-standing historical and cultural heritage, played a significant role in social life and economic development. This paper investigates the impact of indigenous religious traditions in China on firm greenwashing from an informal institutional perspective. The research finds that indigenous religious traditions negatively impact the greenwashing behavior of listed enterprises. This relationship holds true after conducting a sequence of endogeneity tests. Furthermore, path analysis from the dual perspectives of “information disclosure” and “management self-discipline” reveals that the religious traditions at the enterprise’s place of registration inhibit greenwashing through mechanisms of enhancing managerial ethical awareness and strengthening managers’ risk-avoidance tendencies. Moderation analysis results indicate that the level of legal development and product market competitiveness attenuate this negative relationship. Further distinguishing by enterprise characteristics, the inhibitory impact of religious traditions on greenwashing behavior is found only in less market-oriented, less audited, less externally scrutinized, and non-state-owned firms. This article contributes to understanding the factors and mechanisms influencing enterprise greenwashing behavior from an informal institutional perspective, enriching research on the economic consequences of religious traditions and expanding the conceptual framework of firms’ cultural-economic consequences.</p>