Abstract
ABSTRACT Achieving balanced sustainable development remains a central global challenge, with repeated warnings from COP26 to COP28 revealing persistent imbalances across economic, environmental, and social pillars. This challenge is especially acute in the Global South, where rising human capital has not translated into corresponding environmental progress. This paper investigates whether digital capability serves as the activation mechanism that enables human capital to generate triple‐bottom‐line (TBL) sustainability. Drawing on a panel of 60 Global South economies from 2000 to 2022, we develop a capability‐activation framework in which human capital represents latent potential, digital capability functions as its operational catalyst, and institutions shape the magnitude of their combined effects. Using a multi‐layered econometric strategy—Fixed Effects with Driscoll–Kraay corrections, Common Correlated Effects Mean Group (CCEMG), Panel Threshold Regression (PTR), and Method of Moments Quantile Regression (MMQR)—the study identifies strong and asymmetric capability dynamics. Human capital consistently enhances economic and social sustainability but exerts no independent effect on environmental performance. Digital capability emerges as the strongest driver of environmental sustainability, and PTR reveals a clear digital threshold above which human capital begins to reduce carbon intensity. MMQR demonstrates that this activation mechanism intensifies at higher sustainability quantiles, while temporal and regional robustness checks confirm its stability across the pre‐ and post‐SDG eras and across Africa, Asia, and Latin America. The findings highlight that for the Global South, progress toward balanced SDGs depends not on isolated investments in education or technology but on strategically sequenced, mutually reinforcing advances in human capital, digital capability, and institutional governance.