business ethics

1. Internal
We as a society have assumed companies in whole have been ethical in doing business. It wasn’t
until Enron in 2001 that the public has become more aware of business activities. Shortly after
Enron, Tyco International caught the public eye. One must first have an understanding of what it is
to be ethical and moral. Once there is an understanding of these two terms, one may gain an
appreciation of the occurrences in the corporate business world in the early 2000’s. One
occurrence in particular is Tyco International. Tyco International will be evaluated. This evaluation
will include the historical aspects, the corporate spending and the loans obtained, the outcome of
events, and the punishments imposed. Further, the question of is it difficult to see ethical breaches
that we may commit will be discussed.
Ethics and morality are interconnected and thus integrity is also linked. According to Stephens, one
cannot be defined without the other being in the definition. Stephens states many definitions of
ethics have morals within the definition. One may differ with Stephens. While both ethics and
morals relate to right and wrong, ethics is set rules of conduct that spells out how things are based
on the rules for a specified group or action and morals are based on a person’s habits or principles
and ideals as to their conduct. Integrity is a rigid adherence to a code of behavior. Ethics is society
driven and is flexible to a point. Morals and integrity are internalized within self and are found to be
fairly consistent unless a person changes their belief.
Now with the understanding of ethics, morals, and integrity, we can focus on the history of Tyco
International. Tyco International began as Tyco Laboratories in 1960. As Tyco expanded, Dennis
Kozlowski joined Tyco in 1975 as an assistant controller. Later after Tyco changed its focus from
growth to profits
1) Briefly summarize the historical scenario surrounding Tyco international
The main issue at Tyco is unethical behavior in business decisions favoring a few rather than the
overall company's organization vision and mission. Basically, the Tyco International organization
entailed several acquisition mergers from ADT to Raychem for strengthen the overall business
portfolio. In the competitive marketplace, the footprint is more impressive with many entities

2. Internal
reporting to the parent company, as in, Tyco International. However, the CEO leadership resulted in
questionable and unethical behavior that today reflects lack of empathy in the procedural and
protocol effort to ensure proper business dealings;
a) Financial reporting (try and connect the CEO, Dennis Kozlowski from 1992 onward to 2003 that
demonstrated leadership decisions reflecting unethical and conflict of interests by hiring certain
friends on the board of directors and misrepresentations on accounting practices of data)
b) The selling or splitting of stock (try and associate the accounting habit where one line item
entailed irregular financial transactions that lead to indicate the CEO and some board members
miss-using Tyco's funds for personal use)
c) Conflict of interests ( try and identify how the conflict of hiring or selecting certain individuals that
where personal aspirations outweighs the professional aspect in making ethical choices, thus, the
prevention in not applying the corporate governance and social responsibility)
Keep in mind, the summary of Tyco International is in the leadership behavior that automatically sets
the tone of organizational behavior, thus, the selection of board members the CEO, Kozlowski
utilizes to carry out and continue the type of unethical behavior throughout the organization.
2) How do you think the spending and the loans were able to go on for so long?
Try and think of the accounting procedural as a way to monitor and analysis any unethical practices,
as in, the other fortune 500 companies from Enron and others that through the accounting practices
leave patterns of questionable discrepancies. Keep in mind, the unethical transactions can overtime
expose accounting habits not in compliance to the reality to meeting the financial obligations in
business activities. Therefore, the irregular financial accounts indicate negative exposure overtime,
hence, the growing rumors on Tyco International spending habits and so-called acquiring of
business enterprises that can entail more debt than expected.
Try and think of the strategic decision to deceive and conduct unethical behavior by the CEO by
hiring or selecting some close allies on the board of directors to assists in the fraud. Keep in mind,

3. Internal
the fraudulent behavior can only succeed with assistance from other but overtime the excess
spending usually explodes due to not able to covering up the lack of actual incoming revenue.
3) Evaluate the outcome of event
Consider the board of directors not underlies the influence of the CEO, Kozlowski, in which, the firing
or resigning of the executives led to an aggressive approach in determine fault. Keep in mind, the
accounting practices provide key areas of focuses to follow the money that led to interpret the CEO,
Kozlowski spending more or unauthorized spending not in compliant to the board of directors.
Businesses must constantly report spending habits, spending changes, and spending strategies in
compliance or balance of actual streaming revenue, however, the greed complex always influence
unethical behavior in excesses that entails being caught. Some key areas of consequences of the
unethical behavior as in association to Tyco International:
a) Lack of trust amongst employees (try and identify the employees as the most to lose in the case
of unethical behavior where the misrepresentation of financial stability in revenue and stock value
impacts negatively greatly)
b) The destabilization in company financial standing as well as brand that impacts the corresponding
of the subsidiaries (try and identify the acquisitions of companies under the parent company that
infuses revenue now restricted in moving forward on business strategies of expansion due to a
fraudulent data worth to proceed)
4) Was the punishment justified? Why or Why not?
In any business organization the strategy is ethical conduct to ensure business continuity in meeting
targeted goals within the industry marketplace, however, the leadership factor is critical to assure the
values align with such initiatives. When the unethical leadership continues to lead, the organization
suffers greatly to not fulfilling the primary objective in serving the stakeholders for sustainability.
Keep in mind, the strategic position is making sure the punishment is severe enough that
demonstrates non-cooperative acceptance to such unethical behavior that promotes lack of

4. Internal
responsibility. Leadership is imperative towards the company's strength for facilitating policies and
protocols for conducting business, however, the phase in which leadership deters from the values
leading unethical behavior cease ethical mission objectives.
Therefore, the case study of Tyco International is in consensus to unethical decisions only benefiting
a few, rather, than the company as a whole that eventually reduces value. The punishment is in
reflective to the current state and federal laws through an investigation to determining the individuals
involved in such unethical behavior from fines to jail time.
5) Is it difficult for us to see ethical breaches we ourselves commit?
Aim in framing the self-unethical conduct by measuring up to the values and moral standards to
entail behavioral output, in doing so, the organizational behavior can change either way based on
individual decisions. Thus, the ethical breaches can reflect the consequences in the miss-
representative in company's brand identity and brand value due to poor choices benefiting a few
individuals. The moral standards comes into play that can either support a commitment to ethical
behavior or a breach in behavior conduct in honoring the company's value and mission objective
within the targeted industry. Depending on the individual moral standards entail the difficulty in
seeing their ethical or unethical behavior to fully commit, mainly, the situation is due to complacent
support by other employees not stopping the abuse of unethical behavior conduct. In the case study,
the observation indicates an already motive to deceive and self-benefiting oneself that serves a few
rather than the company at a whole.
For more information on the topic subject, the following provide are some good references:
Bianco, A. et al. (2002). The rise and fall of Dennis Kozlowski, retrieved from
www.businessweek.com/the_rise_and_fall_of _dennis_kozlowski
Roach, S.S. Services Under Siege - The Restructuring Imperative. Harvard Business Review,
September-October (1991), pp. 82-92.

5. Internal
O'Conor, Darren (2000) Business Planning, Scitech Educational - Peer Review, pg. 126, Business
Planning and Business Forecasting
Gro, Stale & Reidar. (2011). The Relationship Between Supervisor Personality, Supervisors, Journal
of Social Psychology 12 (10): 433-465
Read Youngpeter, K. (2008). Controversial psychological research methods and their influence on
the development of formal ethical guidelines. Student Journal of Psychological Science, 1(1), 4-12.
Business Rutgers (2012) Tyco International Speakers on Leadership, retrieved from
http://business.rutgers.edu/news/tyco-international-executives-speak-rutgers-institute-ethical-
leadership-speakers-series-november