This is bad practice in far worse ways than a triply nested loop. You are using awk and sed to process individual lines. They are full-fledged languages -- I get the impression this program could be rewritten as one awk call; so this is like running, loading, and quitting a web browser to read each individual word on a web page. Seven times per word. Monstrously inefficient, not how it's intended to be used at all. The use of awk to split columns on single, individual lines is especially troublesome, shell read and text substitution is fully capable of doing that.

ls -l | awk '{ print $9 }' is also dangerous and wrong. Why ask ls for extended information then throw it all away? This will also break apart filenames which contain spaces. for j in ./lists/* does the same thing far more safely and without using ls at all.

Except that you don't appear to be using the value of j anywhere even though you loop over it. What are you trying to do? That part of the loop looks like a complete no-op right now. The actual loop is over /path/to/lists/first_list and nothing else.

All things considered, three loops isn't so bad if written well. Please explain what this code is for and I'll help improve it. The contents of /path/to/lists/first_list would also be extremely helpful to figuring out why your current program isn't working.