Tuesday's AFR opinion pages included a double whammy against two prominent themes for corporate responsibility: that companies need to meet the so-called "triple bottom line" and that they need to pursue "stakeholderism".

Alan Kohler is right to entertain doubts about the buzz concept of the triple bottom line, which asks businesses to account for social, environmental and financial performance. After all, HIH and One.Tel have shown that even getting one bottom line right can be hard, much less three. But he's wrong if he thinks that today's corporations don't need to figure out how to deliver a lot more societal value - including positive environmental outcomes - along with their quarterly profit reports. He's doubly wrong to base his thesis on a new book by a statistician.

We all know the line about lies, damn lies and statistics. Bjorn Lomborg, associate professor of statistics at Aarhus University in Denmark, did well to get his arguments purporting to debunk the key statistical claims of environmental doomsayers published in The Economist recently.

According to Lomborg, everything from human population expansion to species extinctions has been wildly exaggerated. Kohler does credit Lomborg with acknowledging global warming as a genuine problem, but says he found that the "proposed cure is more expensive than the disease".

Try telling that to the people of Tuvalu and other small island nations currently meeting at the South Pacific Forum in Nauru, where they'll be questioning the Australian and US government positions on the Kyoto Protocol while waiting for climate change to send their atolls under water.

The people who buy goods and services from corporations big and small don't really think only in statistics, and smart CEOs know it. Value for money aside, their thinking is guided by emotions and icons, not something as cold as percentages.

They think of coral reefs dying, the Murray-Darling turning to salt, the Aral Sea drying up, African children with HIV, Third World sweatshops and anti-globalisation protesters in the streets of Seattle and other cities. Corporate bosses don't just use statistics and profit reports to make all their decisions, either. Not the imaginative ones, anyway. Business leaders need good intuition and gut instinct because often they have to act before all of the figuring out is done, and they can get it very wrong too, as the tech wreck showed.

But Kohler extrapolated boldly from the statistical challenges in Lomborg's forthcoming book, The Skeptical Environmentalist, to warn off chief executives who "uncritically embrace" the triple bottom line, which he damns as a "public relations slogan". That's fair enough, because you'd have to worry about CEOs who uncritically embrace anything.

While triple bottom line reporting is not a panacea for business, neither is ignoring the vital indicators that all is not well for business as usual. The fact is that if executives focus on most of the big environmental or social issues affecting business - for example, energy use, water consumption, pollution control, workplace health and safety, ethical conduct and anti-corporate activism - they'll find they can impact on the bottom line in very traditional ways. That means in areas such as margin improvement, risk management, growth enhancement and capital efficiency.

The real challenge for today's responsible corporations is not trying to invent alternative bottom lines.

Instead, it's to figure out how to convert the societal value that they create into shareholder value that can be accounted for at the one and only financial bottom line.

This leads to the second part of Tuesday's AFR double whammy, where Samuel Gregg, an adjunct scholar with the Centre for Independent Studies, argued that "stakeholderism" could damage the "moral ecology" of business. Stakeholders are all the people and groups who can affect a business, or can be affected by it.

Gregg is worried that trying to consult with all of them is illogical for business, because that means almost everyone for big trans-national corporations, leading to an "essential ethical incoherence". But companies don't just talk to stakeholders to help them agonise their way through moral dilemmas.

Stakeholders occupy a web of potential value that surrounds corporations, a realm that can deliver far more rewards for shareholders than the narrow old value chain ever did, and also one that can inflict a terrible toll. Life sciences giant Monsanto learnt the latter lesson when it sought to impose its genetically modified crop technology on a reluctant Europe in the late 1990s. The reaction of critical stakeholders such as environmental activist groups was both predictable and accessible to Monsanto's leaders, if only they had listened.

Anyway, isn't talking to everyone exactly what business tries to do with the vast sums it habitually spends on market research, or what politicians do for that matter with their relentless opinion polling? And hasn't today's internet technology made it possible for targeted communications on a previously unimaginable scale?

Stakeholder engagement is really a process for adding more value by working through key interest groups - be they green groups or consumer advocates or human rights champions, or whoever - that reflect the emerging directions being taken by society, and therefore the market-place.

Sure, the signals can be confusing at times. But that's business, isn't it? Getting tough decisions right is how CEOs are supposed to earn those big fat performance bonuses.

Murray Hogarth is a consultant with Sydney-based Ecos Corporation, which advises companies on sustainability strategies.

First published in the Australian Financial Review. Originally published 17 August, 2001.