According to Sir Robert Smith, chairman of both the Weir Group and Scottish & Southern Energy, business needs to arrive at a more sustainable relationship with the wider society in which it operates.

At least I think that's what he's saying. The title of his inaugural ICAS lecture in memory of Aileen Beattie, delivered in London on Tuesday evening, was Business and Society: A Sustainable Relationship. Note, my word "more" does not appear anywhere. And there's no question mark at the end of his title.

But the main thrust of Smith's argument - that there is growing pressure for companies to understand and act on a widening range of risks across their business, but evidence that less than a third of them incorporate risks and opportunities associated with sustainability into their strategies - suggests that's precisely what he meant.

Businesses, he went on, "are run by people for people". We've all heard corporate executives routinely mouth the mantra: Our people are our most important asset. As Smith puts it: "Corporate responsibility is increasingly the overriding factor in attracting, retaining and motivating a talented and diverse workforce".

But so often it can all go horribly wrong. Not so long ago, the departing chief executive of BP, Lord Browne of Madingley, was lionised by his corporate peers, again and again voted the most admired manager of his generation. In 2002, the Financial Times even devoted six pages to an extended and hugely-flattering portrait of the man they dubbed the oil industry's Sun King.

Now, after a series of operational disasters (from an explosion at its Texas City refinery which claimed 15 lives to oil spills from corroding pipelines in Alaska), Browne is leaving BP 17 months ahead of schedule. His successor is already promising to focus "like a laser" on safe and reliable operations, even at the expense of bottom line growth.

"The investment community is increasingly regarding corporate responsibility as a proxy for quality of management of a company," suggests the Weir Group chairman, citing evidence that 86% of institutional investors across Europe believe that social and environmental risk management will have a significantly positive impact on a company's long-term market value.

But is that evidence entirely credible? When HBOS became embroiled in the Farepak scandal before Christmas, the banking group's senior executives were only too aware of the reputational risks they were running. That issue had appeared out of left field and caught them cold.

But having failed to manage that risk, did the affair really have any long-term impact on the Bank of Scotland parent's market value? Despite the wave of public sympathy for the poor people who lost most of their savings and intense media and political criticism for a while, HBOS resisted all calls to compensate the Farepak savers in full.

As the story has fallen out of the headlines, I see no long-term damage to the bank's share price.

If Tony Hayward's laser sorts out BP's safety record and the oil group's reduced production forecasts through to 2009 prove overly conservative, might not BP's market valuation bounce back and Hayward begin to look like the man fit to fill the Sun King's shoes?

After all, who now talks about the Weir Group's little procurement difficulties in Iraq on which Smith was said to have once "bared his soul", despite it all happening before he set foot in the place.

I've no doubt people at the front line in business can and do get caught in the reputational crossfire when things go wrong.

The case that bothers me most is Sam Russell, the founder of Fife-based electronics group Simclar. Since the business decided to close two plants in Ayrshire last month, putting 420 people out of work, Russell has been treated like a pariah.

Labour politicians, including Holyrood ministers, have lined up to take cheap shots at him. He's been accused of asset-stripping and callously throwing a loyal workforce on the dole. He's been threatened with DTI inquiry. The local MP said Russell could "dip into his small change" to pay his workforce off properly.

Even First Minister Jack McConnell joined in to suggest "it does appear that this company has not acted properly in carrying out its responsibilities".

Would that any of them had bothered to look at Russell's record of business building since he first embarked on Simclar's journey in 1976, buying a second-hand braiding machine for £140 and installing it in his garage.

He's battled more set-backs, run more risks than any of them know, many due to foreign-owned multinationals, lured here on state subsidies, going back on their word.

Through all Simclar's ups and downs, Russell has built a business that has given work to thousands down the years, here in Scotland and around the world from the United States to China.

He has clearly run out of road in Ayrshire. And the Sam Russell I know will feel that reverse as keenly as anyone. He doesn't deserve the political vilification he's receiving.

In the end social responsibility cuts both ways.