Abstract Considering the serious environmental uncertainties and challenges facing the supply chain, the focal firm with supply chain ethical leadership (SCEL) can effectively coordinate the economic and environmental relationships and achieve sustainable supply chain. Although its importance, the knowledge of how to shape SCEL is limited. Based on signaling theory, we explore that the mechanism and boundary conditions of green intellectual capital (GIC) shape SCEL via ambidextrous environmental strategy and the moderating role of supply chain trust. Using 317 survey data from Chinese manufacturers, we conducted the hierarchical regression analysis to test the hypotheses. Our results reveal that both green human capital and green relational capital have direct and indirect impacts on SCEL, while green structural capital only contributes to SCEL via ambidextrous environmental strategy. Moreover, when the degree of supply chain trust increases, the effect of ambidextrous environmental strategy on SCEL becomes stronger. This research contributes to the supply chain leadership and environmental strategy literature and provides novel insights into better understanding the mechanisms of shaping SCEL. Managers would do better to shape SCEL by sending reliable signals of GIC and ambidextrous environmental strategy.