Abstract Background Achieving sustainable performance in healthcare organizations has become a pressing necessity, driven by environmental challenges and the imperative for enhanced efficiency. Within nursing leadership, the integration of green absorptive capacity, green intellectual capital, and green knowledge management has emerged as a strategic approach to fostering sustainability. However, empirical research on the interplay of these green competencies in the nursing sector remains limited. Aim This study aims to examine the mediating role of green knowledge management (GKM) in the relationships between green absorptive capacity, green intellectual capital, and sustainable performance among nursing managers. It explores how GKM processes translate environmental competencies into sustainable leadership outcomes. Methods A cross-sectional descriptive correlational study was conducted among 207 nursing managers at Zagazig University Hospitals, Egypt. Data was collected using five validated instruments, including the Green Absorptive Capacity Questionnaire, Green Intellectual Capital Questionnaire, Sustainable Performance Questionnaire, and Green Knowledge Management Scale. Structural equation modeling and path analysis were performed to test the study hypotheses. Results The findings revealed significant positive associations between green absorptive capacity (β = 0.123, p < 0.001), green intellectual capital (β = 0.064, p = 0.016), and sustainable performance among nursing managers. Green knowledge management exhibited the strongest direct effect on sustainable performance (β = 0.727, p < 0.001). Additionally, green knowledge management significantly moderated the relationships between green absorptive capacity and sustainable performance (β = 0.256, p < 0.001) as well as between green intellectual capital