Does CSR Improve Corporate Performance?

“For more than 35 years a quest has been underway to determine whether corporate social responsibility (CSR) produces higher financial returns (Margolis and Walsh 2003, p. 273). For example, a number of theorists have developed an array of substantial literature arguing that socially responsible practices are part of a constellation of management behaviours that contribute to better financial performance (Jones 1995; Kotter and Heskett 1992; Pfeffer 1998; Reichheld 1996; Ullmann 1985; Waddock and Graves 1997). Also, more than 127 empirical studies have been conducted on the subject (Margolis and Walsh 2003).

If work on this subject clearly established that CSR produced stronger corporate financial performance (CFP), there would be major benefits. Then it would not be necessary to attempt via normative arguments alone to persuade those who believe business should focus primarily on financial returns that some profits should be sacrificed in favour of CSR (cf. Wood and Jones 1995, pp. 230–231),” (DeMaCarty, 2009, 394).

Peter DeMaCarty highlights in his article how, “it is clear that many companies continue to be longer on CSR words than action (Moskowitz 2002; Waddock 2002). Thus, despite excellent progress in a substantial number of companies, we are still a long way from seeing CSR become fully adopted by business (see Franklin 2008, pp. 3–6, 22–24). So it is apparent that the normative arguments, theoretical work and empirical research in favour of CSR have left many business leaders unconvinced. As a result, it is clearly worthwhile to continue seeking a better understanding of the CSR-financial relationship,” (p.395).

Yet it seems a shame that there are so many people making the argument for CSR, but don’t seem to be presenting the facts in a way that attracts the majority of organisations and encourages them to realign themselves with a workable CSR strategy.

Unfortunately as DeMaCarty mentions “the effects of managing apparent CSR skilfully, along with other obstacles to developing accurate CSR measurements, probably explain a positive correlation of CSR as measured in studies with financials. Again, what makes higher CSR ratings correlate with better financials probably is an ability of skilful companies, whether they are actually responsible or irresponsible, to both ratchet up their CSR ratings as appropriate and to achieve better financial returns,” (p.419).

One of the most interesting discussions, that may surprise some is whether, we, the human race, can in fact possess ‘moral freedom’, and as DeMaCarty reminds us, “the key controversy surrounds the question of whether causal determinism is true and implies that people cannot possess moral freedom, and therefore cannot be held responsible for their actions (O’Connor 2000),” (p.420). To counter this a further perspective, “termed agent causation, denies that determinism actually does account for all decisions, and holds that the person himself or herself is the cause of his or her actions (O’Connor 2000; see also Descartes 1641/1984, p. 343). Variations of such views claim that our nature or circumstances might limit our choices, but we have freedom in choosing among those open to us.

Finally, “another range of theories holds that our decisions are all caused by events we do not control. Some of them argue that we nevertheless have free will. One variety essentially equates free will with freedom to act without an external constraint or threat (see Hobbes 1651/1997, p. 116; and Widerker and McKenna 2003),” (p.420-421).

What is clear after all the research and mentioned by DeMaCarty is that, “from a financial standpoint, managers have a choice between adopting Corporate Social Responsibility (CSR) or Corporate Social Irresponsibility (CSI) that is not compelled by financial considerations, because they can get equally strong financial returns either way”.

DeMaCarty highlights how “there are strategic principles that can help managers maximise the financial benefits available to responsible companies (see Jones 1995; Kotter and Heskett 1992; Pfeffer 1998; Reichheld 1996; Waddock and Graves 1997). As a result, decent managers who no longer believe they are pressed by financial consequences to adopt certain CSI practices are likely to choose responsible management,” (p.427).

References

DeMaCarty, P. (2009). Financial Returns of Corporate Social Responsibility, and the Moral Freedom and Responsibility of Business Leaders. Business & Society Review, Vol. 114, Issue 3, p. 393-433.

Who are the Worlds Best Business Leaders?

In a controversial article in the Jan/Feb (2010) issue of the Harvard Business Review, Morten Hansen, Herminia Ibarra and Urs Peyer compiled the first ever ranking that shows which CEO’s performed best over their entire time in office – or, for those still in the job, up until September 30th 2009,

To create their ranking they identified all the CEO’s of all publicly traded companies that made the Standard & Poor’s Global 1200 or BRIC 40 lists since 1997. To be included a CEO had to have assumed the job no earlier than January 1995 and no later than December 2007.

To calculate the rankings they assessed the daily company returns for each CEO for the entire length of tenure or until the 30th September 2009. They calculated three performance indicators, (1) the country adjusted company returns; (2) the industry adjusted company returns; and (3) the market capitalisation change. The logic for the three performance indicators over the tenure was to give a more balanced approach.

They identified 1,999 CEO’s world wide making the criteria, and assessed them as follows;

1) Steve Jobs – Apple (1997 – present). Information Technology (USA). Market capitalisation change $150 billion.
2) Yun Jong-Yong – Samsung Electronics (1996 – 2008). Information Technology (South Korea). Market capitalisation change $127 billion.
3) Alexey Miller – Gazprom (2001 – present). Energy (Russia). Market capitalisation change $101 billion.
4) John Chambers – Cisco Systems (1995 – present). Information Technology (USA). Market capitalisation change $152 billion.
5) Mukesh Ambani – Reliance Industries (2002 – present). Energy (India). Market capitalisation change $72 billion.
6) John Martin – Gilead Sciences (1996 – present). Health Care (USA). Market capitalisation change $39 billion.
7) Jeffrey Bezos – Amazon.com (1996 – present). Retail (USA). Market capitalisation change $37 billion.
8) Margaret Whitman – eBay (1998 – 2008). Retail (USA). Market capitalisation change $37 billion.
9) Eric Schmidt – Google (2001 – present). Information Technology (USA). Market capitalisation change $101 billion.
10) Hugh Grant – Monsanto (2003 – present). Materials (USA). Market capitalisation change $35 billion.

The reason you don’t see names such as Bill Gates, Jack Walsh, Larry Ellison, and Warren Buffet, is that they all assumed their CEO roles before 1995, (though the authors feel they would have done well if included).

What’s interesting is that the top 50 increased the wealth of their companies’ shareholders by $48.2 billion (adjusted for inflation, dividends, share repurchases, and share issues); compared to the bottom 50 who produced a loss of $18.3 billion in shareholder value over their tenure, (p.107).

Some other interesting facts from their assessment include;

 The median age at which these executives became CEO’s was 52.
 Only 1.5% are women.
 Only 15% of the CEO’s worked for companies that were situated outside of their country of birth.
 16 countries are represented in the top 50.
 14 of the top 50 had MBA’s.
 12 of the top 50 were recruited from outside the organisation.

Compared to the Barron’s list which is compiled through discussions with investors, analysts and executives, five executives appeared in the Barron’s list and the top 30; Steve Jobs (Apple); John Chambers (Cisco); Jeff Bezos (Amazon); Hugh Grant (Monsanto) and Terry Leahy (Tesco).

The controversy comes from a variety of angles. For example, questions were raised about the validity of Alexey Miller at number three, and the circumstances under which this company generates such large returns. Also questions were asked about non-profit and SME organisations, but then they wouldn’t meet the criteria under which this analysis was conducted. Other questions were around why someone’s ‘favourite’ leader wasn’t on the list.

However, whether ones favourite isn’t in the top 10, or one disagrees with their ranking criteria, what we shouldn’t disagree with is their closing statement, where they conclude that “only by analysing performance over their tenure and beyond can we begin to understand the nature of great leadership,” (p113).

Those who were ranked 11th to 50th were; (11) Robert Tillman (Lowe’s – USA); (12) William Greehey (Valero Energy – USA); (13) Gareth Davis (Imperial Tobacco – UK); (14) William Doyle (PotashCorp – Canada); (15) Benjamin Steinbruch (Companhia Siderurgica Nacional – Brazil); (16) Bart Becht (Reckitt Benckiser Group – UK); (17) Masahiro Sakane (Komatsu – Japan); (18) Terry Leahy (Tesco – UK); (19) John Thompson (Symantec – USA); (20) Graham MacKay (SAB Miller – UK); (21) Mikael Lilius (Fortum – Finland); (22) Mikhail Prokhorov (Norilsk Nickel – Russia); (23) Mark Papa (EOG Resources – USA); (24) C. John Wilder (TXU – USA); (25) Frank Chapman (BG Group – UK); (26) Paul Chisholm (Colt Telecom Group – UK); (27) David Snow, Jr. (Medco Health Solutions – USA); (28) Tomeo Kanbayashi (NTT Data – Japan); (29) Chung Mong-Koo (Hyundai Motor – South Korea); (30) John Lau (Husky Energy – Canada); (31) Stanley Fink (Man Group – UK); (32) Antoine Zacharias (Vinci – France); (33) Juan Villalonga (Telefonica – Spain); (34) Harry Roels (RWE – Germany); (35) Charles Goodyear (BHP Billiton – UK); (36) Matteo Arpe (Capitalia – Italy); (37) Florentino Perez (Group ACS – Spain); (38) Fujio Mitarai (Canon – Japan); (39) Roy Gardner (Centrica – UK); (40) Thierry Desmarest (Total – France); (41) Wang Jianzhou (China Mobile – China); (42) Fu Chengyu (CNOOC Ltd – China); (43) Mark Pigott (Paccar – USA); (44) William Osborn (Northern Trust – USA); (45) Craig Donohue (CME Group – USA); (46) David Simon (Simon Property Group – USA); (47) Larry Glasscock (WellPoint – USA); (48) AJ Scheepbouwer (Royal KPN – Netherlands); (49) Fred Kindle – (ABB – Switzerland); (50) David Pyott (Allergan – USA).

To view the top 100 and access a list of the top 200, go to http://www.hbr.org/top-ceos

References

Hansen, M. T., Ibarra, H. and Peyer, U. (2010). The Best-Performing CEOs in the World. Harvard Business Review, Vol. 88, Issue 1, p.104-113.

Are You A Flexible Leader?

Daniel Goleman, in an article in the Harvard Business Review, “suggests that the most effective executives use a collection of distinct leadership styles each in the right measure, at just the right time. Such flexibility is tough to put into action, but it pays off in performance” (p.78). In fact Young and Dulewicz, support this view highlighting previous studies, covering the 50 years from 1958 to 2008, by a variety of authors, (Tannenbaum and Schmidt; Fiedler; House; Reddin; Hersey and Blanchard; Senge; Jaworski; Higgs and Rowland; and Dulewicz and Higgs), which all show that effective leadership will vary with circumstance; and where recent authors have moved on from focusing on the leader/follower variables to examining the efficacy of different leadership behaviours in different contexts of change, (p.384).

Goleman highlights how effective leadership eludes many people and organisations. One reason he gives is that there is very little quantitative research to demonstrate which precise leadership behaviours yield positive and lasting results. Then you have leadership experts offering advice based on inference, experience, and instinct. Sometimes that advice is right on target; sometimes it's not. And finally you have the leaders themselves, who often are not aware of the most up-to-date leadership results and techniques that could help them become more effective in their role, be it at the strategic leadership or the team leader level.

One key area that does play a role in effective leadership is Emotional Intelligence (EI), where as Goleman explains “EI is the ability to manage ourselves and our relationships effectively; and consists of four fundamental capabilities: self-awareness, self-management, social awareness, and social skills. Each capability, in turn, is composed of specific sets of competencies”, (p.80).

1) Where Self-Awareness, includes:
a) Emotional self-awareness,
b) Accurate self-assessment,
c) Self-confidence.

2) Where Self-Management, includes:
a) Self-control,
b) Trustworthiness,
c) Conscientiousness,
d) Adaptability,
e) Achievement orientation,
f) Initiative.

3) Where Social Awareness, includes:
a) Empathy,
b) Organisational awareness,
c) Service orientation, and

4) Where Social Skills, includes:
a) Vision,
b) Influence,
c) Coaching and mentoring,
d) Communication,
e) Innovation,
f) Conflict management,
g) Relationship building,
h) Teamwork and collaboration

When it comes to leadership styles however, although most agree there is a need to flex the style to the circumstances, part of the confusion comes from each ‘author’ creating their own ‘names’ for different approaches to leadership, rather than trying to find some conformity. A common language of leadership would make it easier for both incumbent and potential leaders to understand and effectively utilise the different leadership styles.

For example Goleman highlights six different styles of leadership, (p.80).

1) Coercive leaders, demand immediate compliance,
2) Authoritative leaders mobilize people toward a vision,
3) Affiliative leaders create emotional bonds and harmony,
4) Democratic leaders build consensus through participation,
5) Pacesetting leaders expect excellence and self-direction, and
6) Coaching leaders develop people for the future.

Where as Young and Dulewicz highlight only three;

1) Goal-orientated: Where the leader sets the direction and plays a significant role in directing others (though this does not imply an authoritarian approach, but a leader-centric approach).

2) Involving: Where the leader provides a strong sense of direction, but with more focus on involving others. Not only in setting the direction, but also in deciding how the goals and objectives will be achieved.

3) Engaging: Where the leader is focused on facilitating others in, firstly, deciding the future goals and direction, and secondly, the approach to be used for achieving these desired goals.

And it doesn’t end there as there are a multitude of other suggested approaches including the ‘Full Range Model of Leadership’, where the late Bernard Bass (founding editor of the leadership quarterly journal) back in 1990, attributed four behavioural characteristics to a transformational leader: (1) charisma; (2) inspirational motivation; (3) intellectual stimulation and (4) individualised consideration. It was only later, in 2003, when John Antonakis, Bruce Avolio and Nagaraj Sivasubramaniam replaced the characteristic of charisma with, what they termed, ‘idealised influence’.

What is clear is that the global business environment is continually changing, and a leader must be able to respond appropriately. Leaders first need to learn, internalise and understand the different approaches to leadership; not from an academic, put a practical perspective. Then they can intuitively adapt to the changing environment, in the process becoming effective flexible leaders. This in turn will lead to sustainable organisational growth and the attraction and retention of the best talent. The payoff will then be in the sustainable results.

References

Goleman, D. (2000). Leadership That Gets Results. Harvard Business Review; Vol. 78, Issue 2, p78-90.

Young, M. and Dulewicz, V. (2006). Leadership styles, change context and leader performance in the Royal Navy. Journal of Change Management, Vol. 6, No. 4, p.383-396.

Yung-Shui Wang and Tung-Chun Huang. (2009). The Relationship of Transformational Leadership with Group Cohesiveness and Emotional Intelligence.
Social Behavior & Personality: An International Journal; Vol. 37, Issue 3, p.379-392.

Is Business Planning Overrated?

In a 2004 article in the Academy of Management Executive, entitled ‘If You Fail to Plan, Do You Plan to Fail?; Brett Matherne mentions that “faced with a multitude of forces encouraging speedy action, many firms respond to the pressure by reducing or even eliminating the time allocated to planning. In a nutshell, it seems as if the pressures of the new competitive landscape are pushing planning aside and forcing companies to simply act faster,” (p.156).

In most organisations, but especially SME’s, the availability of time, or the perceived amount of time required to complete a business task, is the single most common reason given by management for not planning properly. So is it really surprising when so much management time is spent on reactive problem solving.

Yet, in a study by Frederic Delmar and Scott Shane they found that planning before action leads to three major benefits;

1) Speedier decision making;
2) Better management of resources; and
3) Clearer identification of the action steps needed to reach important goals.

“Building on prior studies Delmar and Shane suggest that planning facilitates speedier decisions by identifying missing information about the assumptions and consequences associated with possible business actions before funds are actually committed to these actions. Second planning improves the management of resources by identifying specific action steps and the timing of their execution, allowing required resources to be brought to bear in a more effective manner. Third, planning helps focus firm management on action steps necessary to attain the stated goal and minimise distractions,” (cited in Matherne, 2004, p.156)

In fact to be effective, organisational and/or departmental planning should end up in writing and be used as a source document for periodic review. The advantages of a written plan are that it:

1) Forces the organisation to think more realistically, objectively and unemotionally about their business;
2) Leads to the questioning of past and future assumptions;
3) Makes it easier to communicate planning objectives and strategies to stakeholders, employees, suppliers (or other collaborative partners), financial backers etc;
4) Helps to ensure that all aspects of the plan are clear and integrated (something that is very often lacking);
5) Serves as a reference point when determining the effects of alternative courses of action on business operations;
6) Provides a basis for review;
7) Offers a framework for analysis, especially where objectives have not been achieved.

And while it has been acknowledged that business planning does not guarantee success, studies show that organisations which consistently undertake planning perform better than those where planning is lacking.

Why? Because an effective planning process produces a number of benefits for your organisation, including;

1) Forces an early consideration of essential goals and basic policies;
2) Helps to challenge old ideas and create a climate for new initiatives;
3) Gives you a clear focus;
4) Enables problems to be recognised that call for external sources of information and assistance;
5) Increases your objectivity by converting everything to numbers, planning prevents you viewing the future in ways that the facts do not support;
6) Increases personal motivation throughout the organisation;
7) Enables growth to be planned and associated capital requirements to be determined in advance;
8) Provides feedback of information and periodic reappraisal against established objectives and performance standards.

The benefits cited above are just as true for the large multi-national as they are for the sole proprietor and hence planning before you act is likely to reduce the amount of time management waste on reactive tasks. So it’s worth asking, how efficient is your organisational planning process and how effective do you think your current plan for 2011 will be?

References

Department of Economic Development. Planning Your Business Success. website: http://www.development.tas.gov.au

Matherne, B.P. (2004). If You Fail to Plan, Do You Plan to Fail? Academy of Management Executive, Nov, p.156-157.

2010 Reviewed: What Can We Learn to Make a Better 2011?

As a human race we seem, in general, to be very bad at learning lessons from the past, but maybe this year we can change that trend. With 2010 being a difficult year for many, what can we learn from the good, bad and ugly events that made up the last twelve months; that will help us define our future?

The fun, miraculous and tragic events that took place over the last twelve months, included the following that are worth remembering;

The Worlds Broken Promises. On January 12, a 7.0-magnitude earthquake shook Port-au-Prince, Haiti, toppling buildings and destroying most of the country's infrastructure. The Haitian government estimated 230,000 people were killed, more than 300,000 injured, and more than 1,000,000 people left homeless. Humanitarian aid began flowing into the country within hours of the quake; however it was not enough to prevent rioting in the economically ravaged nation.

Nearly a year on from the earthquake, Robert Muggah writes in the Guardian (31st December 2010) that more than a million people are still living in tents and less than a tenth of aid cash has been delivered, and much less has been spent. Even if some allowance is made for the extraordinary devastation wrought by the disasters, few disagree that the Haitian government's handling of the situation has been spectacularly poor. Likewise, with few exceptions, the international aid sector's record has been dismal. And while 2010 was grim, there are few guarantees that 2011 will be any better. As Robert Muggah states, the international community could not stop the earthquake, but surely it can deliver on its promise to help Haitians reconstruct their battered country.

The Rapid Pace of Technological Change. On January 27th, after months of speculation, Apple Inc. CEO, Steve Jobs, unveiled the company's first tablet computer, the iPad. The mobile tablet provided the functionality of a MacBook laptop and the mobility of an iPhone. The iPad hit shelves in April of 2010 and sold more than 3 million units in just 80 days.

Safety First or Second? On January 21, Toyota instituted its second recall after reports of pedals sticking to floor mats, causing people to accelerate without being able to use their break. The recall included 2.3 million vehicles sold in the U.S. and 1.8 million sold in other countries. An additional 1.1 million more Toyota vehicles were recalled a week later. In April 2010, Toyota agreed to pay a record fine of $16.4m (£10.7m) in the US for failing to report defects.

Yet this was just the beginning, as by 21st October 2010, Toyota had issued 14 different recalls, equating to more than 10 million cars worldwide.

A Medical Miracle. On March 20, a team of 30 Spanish doctors completed the first ever full face transplant. The patient 'Oscar' had been injured in a shooting accident.

The Power of Our Planet. On April 14, the Icelandic volcano Eyjafjallajökull erupted for a second time, causing a massive plume of smoke and ash. In just one week the cloud had forced the cancellation of 95,000 flights over Europe.

Do Organisations put Profitability before Responsibility? On April 20, The Deepwater Horizon, an offshore floating oil rig exploded, killing 11 workers and forcing other workers onto life boats. The explosion set off a three month oil leak that reached American shores in Louisiana, Mississippi, Alabama and Florida.

Oil was estimated to be leaking into the Gulf of Mexico at a rate of between 504,000 and 798,000 gallons a day throughout the summer - the Gulf oil spill resulted in 18 million to 30 million gallons accumulating in the Gulf of Mexico dwarfing both the Ixtoc I oil spill and Exxon Valdez oil tanker disaster.

On 17th June, Mr Hayward the CEO of BP sat in front of a US congressional committee, where he was questioned for over five hours. It seemed that Mr Howard had two well planned answers, firstly “we await the results of the investigations before rendering conclusions” and secondly, “I was not involved in the decision making process.” This event made Mr Hayward and BP look incompetent and uncaring. What was even more questionable was when asked when the investigation would be completed, Mr Hayward didn’t have an answer.

Congresswoman Betty Sutton from Ohio probably stated it best when she told Mr Hayward that his lack of answers showed a real detachment and disconnect with the situation – which Mr Hayward denied (and then went sailing two days later).

A First for Africa. On June 11, South Africa welcomed soccer fans from around the world as the World Cup opened for the first time on African soil. Spain defeated The Netherlands in the World Cup Final 1-0, the nation's first World Cup title.

Another Sporting First. On June 24, American John Isner defeated France's Nicholas Mahut 70-68 in the final set, in an 11 hour, and 5 minute tennis match, which spanned three days. The Wimbledon match was the longest match in history. Both players received an award for their efforts.

Can the Freedom of Information Go Too Far? On July 25, the website Wikileaks releases thousands of classified military intelligence documents dating from 2004-2009. The documents revealed startling information on what the U.S. knew about the Taliban, Iran and Pakistan's involvement in the insurgency, and the amount of civilian casualties. Wikileaks founder Julian Assange (pictured) would not reveal the source of the leaked documents. The Wikileaks website continued several more 'document dumps' through the year.

Later on 28th November 2010, WikiLeaks began publishing the first batch of more than 250 000 US diplomatic cables, many of them classified as "secret", that the website is believed to have obtained from a disaffected US soldier. By 3rd December the original wikileaks.org domain was taken offline by its American domain name system provider, EveryDNS.net, following reports of massive cyber-attacks on the site. This followed Amazon booting Wikileaks from its computer servers on Wednesday following pressure from US politicians.

The Power of Nature. On July 26, 2010 huge quantities of rain flooded 1/5th of Pakistan. The resulting flood disaster affected 20 million people creating the worst flood disaster in Pakistan. Over 1,700 people have died and close to 3,000 were injured.

In the month of September, the World Food Programme (WFP) provided food rations for more than six million people in 47 districts, with a daily peak of 440,000 individuals reached on 27 September alone. Yet on 1st October WFP’s emergency food assistance operation in support of flood-affected communities faced a shortfall of more than US$414 million.

A Time for Giving or a Time for PR? On September 22, it was reported that 26-year-old Facebook founder Mark Zuckerberg would donate $100 million to the Newark Public Schools. Zuckerberg later made the official announcement on Oprah. The timing of the announcement was a bit peculiar; as it came just weeks after a movie allegedly about Zuckerberg called 'Social Network' was released. Facebook was heavily criticized in 2010 for allegedly allowing outside sources to pull personal information from its users, but Zuckerberg was later named 'Time Person of the Year' on December 16th.

A Human Miracle. On October 13, after nearly 70 days trapped below the earth in a Chilean mine, 33 miners are rescued through a tiny capsule taken, like an elevator, up a narrow shaft. All 33 miners were rescued and were in good condition. The miners became instant celebrities and each was greeted by Chile's president upon their rescue.

In Memory. Finally let’s remember a few of the special people, who passed away during 2010;

January 11th; Miep Gies, aged 100, the office secretary who defied Nazi occupiers to hide Anne Frank and her family for two years and saved the teenager's diary, in Amsterdam, from a neck injury sustained in a fall at her home.

January 16th, Glenn W. Bell Jr., 86, an entrepreneur best known as the founder of the Taco Bell chain, in Rancho Santa Fe, California. No cause of death was specified.

March 20th, Stewart Udall, 90, who sowed the seeds of the modern environmental movement in the United States as secretary of the interior in the 1960s, in Santa Fe, New Mexico, of natural causes.

May 11th, Giuliana Coen Camerino, 90, an Italian designer credited with making handbags a fashion item, in Venice. No cause of death was given.

May 15th, John Shepard-Barron, 89, the Scotsman credited with inventing the world's first automatic cash machine, in Inverness, after a short illness.

May 31st, Chris Haney, 59, co-creator of the popular Trivial Pursuit board game, in Toronto after a long illness.

June 28th, Nicolas Hayek, 82, chairperson and former chief executive of the giant Swiss watch-manufacturing firm Swatch and credited with reinventing that country's watch-making industry in the 1980s, in Biel Switzerland of heart failure.

July 19th, David Warren, 85, an Australian scientist who invented the "black box" flight data recorder after investigating the first crash of a commercial jetliner in 1954. No place or cause of death was given.

July 23rd, Daniel Schorr, 93, whose career in American journalism over more than six decades landed him in the dark corners of Europe during the Cold War and the shadows of President Richard Nixon's "enemies list," in Washington, after a brief illness.

July 28th, “Papa Jacques" Montouroy, 63, a legendary French aid worker for Catholic Relief Services for 41 years in several African countries and Haiti, in Freetown, Sierra Leone, of complications from an ulcer.

September 8th, Allen Dale June, 91, one of the 29 original Navajo code talkers who confounded the Japanese in World War II by transmitting messages in their native language, in Prescott, Arizona, of natural causes.

October 9th, Maurice Allais, 99, a French Nobel economic winner and an early critic of shortcomings in the worldwide financial system that led to the latest crisis, in Saint Cloud, France of natural causes.

November 16th, Britton Chance, 97, an American scientist whose work in biomedical optics helped develop spectroscopy as a non-invasive way to diagnose medical problems, in Philadelphia of heart failure.

December 18th, Sarah "Sally" Goodrich, 65, who lost a son in the September 11 attacks and later established a foundation to promote education in Afghanistan, at her home in Bennington, Vermont, of cancer.

In Conclusion

Let’s hope that 2011 can be a better year for everyone and that we can remember, learn and implement solutions from the mistakes of our past. 2011 needs more visionary focus and effective communication from our organisational leaders, creating a greater cohesiveness as employees operate from a position of ‘accountable ownership’ and not simple compliance.

Also we need more focus on developing the effective leadership of the future (and not only in business); individuals who can raise the standards and find solutions for the challenges ahead.