Tyco International

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Tyco International

What are the ethical and legal issues in this case?

The ethical and legal issues at Tyco International range from discrimination, accounting fraud, grand larceny. The issues involved cohesion on the part of the CEO, and the members of his team. In addition, they placed great emphasis on placing their own values ahead of what was good for the organization.

What role did Tyco's corporate culture play in the scandal? What roles did the board of directors, CEO, CFO and legal counsel play?

Tyco's corporate culture was driven by the CEO, Dennis Kozlowski who admired the extravagant and lavish lifestyle lavish of the former CEO, Joseph Gaziano. He took an assertive approach to acquisitions and mergers, which helped Tyco, maintain a 14 year growth within the business units. He viewed himself as the organizations, therefore, conducted business as such.

The Boards of Directors are responsible for protecting Tyco's shareholders interest. In some cases, some of the board members were not aware of the fraud, and other unethical deals that were going on behind the scenes. The board members that were aware, did not bring the issues to the other members of the board, therefore, they were just as guilty of unethical behaviors as the CEO and his direct reports. The reason this could have transpired is probably due to the majority of board members being on the board >10 years, and the relationships that had been established over time.

The CEO, CFO and legal counsel, due to the nature of their positions, were not honest and transparent with the stakeholders concerning the issues relating to the accounting fraud and conflicts of interest. They all engaged in an enterprise of corruption and collusion.

Have Tyco's recent actions been sufficient to restore confidence in the company? What other actions should the company take to demonstrate that it intends to play by the rules?

Tyco top management restructured the organization and while in...
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