Tyco International

Question: Write an essay on Tyco International? Answer: Introduction Historical Scenario: Kozlowski who was the CEO used very aggressive loom towards attaining acquisitions as well as mergers while his tenure. For choosing broad of the directors in the firm he just picked own mates and composed firms entire corporate governance scheme (Boylan, 2001). In the year 1999, after the stock split, some rumors started spreading about the firms accounting habits. It also was supposed that Tyco actually was producing very irregular economic or financial accounts. Later Tycos scandal took place in the year 2002 when board of the directors launched proper investigation regarding their members wrong behavior. Then, Kozlowski and all his friends were forced to resign from the post and also they were dragged to court. Kozlowski plus Swartz (CFO) were suspected for thieving $170 million from Tyco international as well as deceitfully selling additional $430 million from the stock options ('Tyco International Ltd', 2001). Even, Kozlowski plus some board of the directors were accused in mis using of the Tyco fund for fulfillment of some private needs as well as were also cited for the conflict of the interest problems. Discussion How the spending and loans went for so long: Tyco actually was never run in any structured way and also the firm did not have any proper system for fraud check. Even as the firm ballooned to $36 billion massive company with somewhat over 200,000 staffs, Kozlowski permitted just a relative handful of the trusted lieutenants towards working with him in the operations undertaken at Tyco's headquarters. Tyco also once indicated lean management scheme which was unable to keep a watch on the staffs of the firm (Stephens, Vance Pettegrew, 2012). Neither any president was not appointed nor was any experts hired. Just some top managers were handpicked, assuring that they belong to the CEOs mold. But such cunning structure cannot be any proper excuse for seemingly obstinate blindness that was exercised by the key players in the firm. Most egregious breakdown of the oversight was the Tyco's board that consisted of the directors belonging to the CEOs friendliest. Another reason was that all the care and control on the information and data were handled by the CEO himself and he was the one most corrupted (Paliwal, 2006). Outcomes of the event: Because of the unethical problems that were observed in the firm, Tyco International faced many other problems like problems with its sustainability, reliability and many more. Also the firm lost its most effective and beneficial customer base and faced much loss as well. Tyco was almost ruined by such unethical leaders. From such perspective, it also can be said that ethics in this firm played the most crucial role for sustaining the organization (Paine, 2000). Being a firm devoid of ethical conducts, Tyco did not last for longer time and soon lost its reputation. Embezzling fund and bribery as well as accounting fraud even were the issues which were the results of the scandal that took place at Tyco international. All such problems were also very unethical and totally ruined the firms reputation in the market. The scandal even breached some ethical theories. As a result for issues such as accounting fraud and unethical behavior, the firm later took some strict actions (Moon, 2001). These actions taken comprised of improved corporate governance, application of extra conservative accounting scheme to replace pattern of the aggressive accounting which was adopted earlier and which proved to be non-beneficial for the firm. Justification of the Punishment: The punishment that was decided against the managers and unethical leaders in Tyco, involved the embezzlement as well as fraud and this was totally justified. Un-ethicality is never ever a thing to be accepted or forgiven (Kaplan, 2009). The managers misrepresented the responsibility and authority given to them, they misused their power and robbed millions and millions of money from the firms fund and also used to satisfy themselves and fulfill their personal needs and demands. The CEO and other leaders in the firm ignored shareholders interest and also never considered customers as vital part of the business. They also withdrew vast amount of money from firms account and used them for private belongings. These leaders took great amount of money as loans plus bonus, knowing that these funds can be properly diverted to some different advantageous project that will be beneficial for the firm and its staffs as well. The punishment in reality can be said to be very lenient, if their frau d and degree of misconduct will be considered. The firm can even get collapsed if this was not controlled on time. Thus the punishment needed to be harsher (Duska, 2000). Ethical breaches: Ethical breaches are actually very common in the firms. However, it becomes extra difficult for people to anyhow realize that they are getting engaged into unethical carryout. Yes, they realize but by the time its too late. People also at times find themselves getting involved into unlawful practices within firms just because of their decision to properly adopt the specific corporate culture which they find in the particular firm. Generally there is a vast gap amid ones beliefs and eventual actions that are taken (Cory, 2005). The corporate culture actually determines the way in which staffs act and behave as well as think at the time of performing several different actions as well as while undertaking many responsibilities in the firm. In the pace of getting devoted to work and adaption the culture in the firm, people generally fall down in the court where they find themselves performing some unethical and unlawful actions. At times people willingly indulge un-ethicality but its not always the situation (Carroll Buchholtz, 2003). Conclusion: The scandal caused shares value to lower down drastically and also made all the workers breathless. Kozlowski actually went to the enormous lengths for keeping the directors in dark and this was the mistake of the directors that they never interfered. References Boylan, M. (2001). Business ethics. Upper Saddle River, NJ: Prentice Hall. Carroll, A., Buchholtz, A. (2003). Business society. Mason, Ohio: Thomson/South-Western. Cory, J. (2005). Activist business ethics. Boston: Kluwer Academic Publishers. Duska, R. (2000). Business Ethics: Oxymoron or Good Business?. Business Ethics Quarterly, 10(1), 111. doi:10.2307/3857699 Kaplan, D. (2009). Koz makes his case. Moon, C. (2001). Business ethics. London: Economist. Paine, L. (2000). Does Ethics Pay?. Business Ethics Quarterly, 10(1), 319. doi:10.2307/3857716 Paliwal, M. (2006). Business ethics. New Delhi: New Age International. Stephens, W., Vance, C., Pettegrew, L. (2012). Embracing ethics and morality. Tyco International Ltd. (2001). World Pumps, 2001(415), 5. doi:10.1016/s0262-1762(01)80116-4