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Tyco Case

In: Business and Management

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BUS 460 – Ethical Decision Making and Leadership
October 17, 2011
Tyco Case 1. What role did Tyco’s corporate culture play in the scandal?
Tyco’s corporate culture played a huge role in the scandal. From the beginning when Kozlowski worked under then CEO Joesph Gaziano, he was impressed by the extravagant lifestyle that his friend and mentor portrayed. Once his mentor passed in 1982 an a new CEO was put in place for Tyco, Kozlowski still desired to follow in Gaziano’s footsteps even if he had to take some cues from the new CEO, John F. Fort III. Rising up the corporate ladder, Kozlowski maintained an aggressive approach that concerned Fort. This concern lead to the board of directors siding with Kozlowski’s theory that the firm should continue to acquire profitable companies that met guidelines which lead to an ousting of Fort and establishing Kozlowski as the new CEO of Tyco once Fort resigned. 2. How did Dennis Kozlowski have the opportunity to steal $137 million in unauthorized bonuses?
Kozlowski had the opportunity to steal $137 million in unauthorized bonuses because he controlled a decentralized firm, where he as the CEO was also the board chair. Also he was allowed to handpick his own board of directors, by choosing trusted individuals and placing them in key positions, instead of having the shareholders take a vote for them. 3. Why is Kozlowski, now a prisoner for a long time, unrepentant about his conduct as CEO of Tyco?
Kozlowski feels that he did no wrong. Even though he took bonuses for his own use, the company was still profitable and his shareholders where still happy. I believe that he also feels that without his ambition to obtain a lavish lifestyle that the firm wouldn’t have had the chance to reach the heights that it had during his tenure as CEO. I also believe that he feels, with his hard work in acquiring these companies he...

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