Purpose Based on the broaden-and-build theory of positive emotions and social information processing (SIP) theory, the present study investigated the effects of benevolent leadership on organizational identity of nursing staff in Egyptian government hospitals in Sharkia Governorate, mediated by forgiveness climate, and the role of positive emotions as a moderator of these relationships. Design/methodology/approach The study collected data through an online survey of 335 nursing staff from 46 Egyptian government hospitals in Sharkia Governorate. The reliability and validity of the scale items were evaluated accurately, and the proposed model and hypotheses were tested using partial least squares structural equation modeling (PLS-SEM). Findings The results reveal the positive direct effects of benevolent leadership and forgiveness climate on nursing staff’s organizational identification, with forgiveness climate partially mediating the relationship between benevolent leadership and organizational identification, and positive emotions moderate the relationship between benevolent leadership and both forgiveness climate and organizational identification. This suggests that fostering a forgiveness climate and encouraging positive emotions can enhance organizational identification in government hospitals. Research limitations/implications The study is limited to government hospitals in Egypt, which may restrict the generalizability of the findings to other sectors or cultural contexts. Future research could explore these dynamics in different settings to enhance external validity. Originality/value This study contributes to the literature by introducing positive emotions as a new variable in the determinants of the forgiveness climate that researchers have not previously addressed. Moreover, it highlights the significant moderating role of positive emotions in the relationship between benevolent leadership and both of forgiveness climate and organizational identification, offering valuable insights for improving organizational culture in healthcare settings.