Tyco Case Study

TYCO: I’M SURE THAT IT’S A REALLY NICE SHOWER

CURTAIN

Daniela Caballeros

Summer A

MAN 4701

ETHICAL ISSUES

1. The Fiduciary Principle of the Global Business Standards Codex in

the fact that Kozlowski was not being loyal to the company in any

way because he used company funds to by property. Paintings and

his wife's birthday party.

2. The Property Principle was violated because Kozlowski was

stealing from the company.

3. The Fairness Principle was violated because Kozlowski was getting

paid a huge salary even though he was manipulating the companies

assets and revenue by spending it.

(Stanwick A. &D. )

CASE QUESTIONS

1.What do you think Kozlowski’s motivation for trying to avoid sales taxes on his

art purchases was? Explain.

Kozlowski’s motivation was power and greed. He could get away with anything because

he was at the top. There was also no real accountability present or loyalty to Tyco. His

mentality was that if he purchased the artwork through Tyco’s name then he would not

have to pay taxes and he falsified the records to hid his wrong doings.

2. Explain the concept of commingling assets with respect to the Tyco case.

Commingling involves treating the company’s money as if it were your own. In this

case, the offending executives used Tyco’s business assets for their own personal

gain by purchasing artwork, real estate properties, jewelry, and other personal items.

They crated problems and gained attention from taxation authorities and SEC and

other criminal investigations due to their fraudulent behaviors.

CASE QUESTIONS1.Would it have been possible for the board of directors to see the

adjustments taking place in the many different programs at Tyco? Explain.

If the board of directors have been more involved then I think maybe they would

have caught on that there were fraudulent and unethical activities happening.

However, since they were not proactive they were not able to stop the misbehavior

from the company’s employees. The board of directors were to be held with as

much fault as the culpants. The tax evasion, inflated profits, commingling of assets

was illegal and the unauthorized bonuses that they were handing out were not

authorized, but they still continued to do it. They also paid off other officials to

remain quiet. Overall, the harmful parties knew what they were doing was illegal,

unethical, and costly to Tyco.

(Stanwick A. &D. )

REFERENCES

Stanwick A. &D. ( 2012, June 17) Tyco: I’m sure

that it’s a really nice shower curtain.