This document discusses a decision made by Tyco International in response to a situation facing the organization. The situation involved misconduct by former CEO Dennis Kozlowski and CFO Mark Swartz, who were sued by the company for over $100 million after improper financial activities. A new CEO and management team made decisions to reform corporate governance and accounting practices. A group including the new CEO and VP of Governance made the final decisions, which included severance agreement reforms, an independent board chair, an ethics guide, and staff replacements. The implications were more ethical leadership and restored investor faith.

1. GROUP 9
MD. MOHIUDDIN JILANI 1129141
NURHIDAYAH BINTI SALLEHUDDIN 1212620
MARDHIAH BINTI MOHD IDRIS 1213546
NOR HAMIZAH BINTI KHALIDI 1215056
NURULHASEENA BINTI KADER MAIDEEN 1221986

2. INTRODUCTION

4. Q1.WHAT WAS THE SITUATION BEING FACED BY THE
ORGANIZATION THAT REQUIRED THE DECISION?

5. Q2. IN THE DECISION, DID THE MANAGER OR
MANAGERS APPEAR TO USE GOOD DECISION
MAKING SKILLS? WAS THE FINAL DECISION
MADE BY A GROUP OR INDIVIDUAL?
YES
General action
• Company filed suit against Kozlowski and Swartz for more than $100
million.
 The SEC (The U.S. Securities and Exchange) allows companies to sue insiders who
Profited by buying and selling company stock
 To restore investors faith, new management team recovered some of the
funds taken by Kozlowski.

6. EDWARD
BREEN
(New CEO)
ERIC
PILLMORE
(Vice President of
Corporate
Governance)
• Review company’s accounting and corporate
governance practices
New board of director voted to
• make future executive severance agreement.
• Require the board chair to be an independent person
rather than a Tyco CEO.
• Tyco Guide to Ethical Conduct
• 90% of headquarters staff were replaced.
• ConcernLINE

7. FINAL DECISION MADE BY
GROUP

8. Q3: What are the ethical implications
of this decision, and who is likely to be
impacted?
TOP
MANAGEMENT EMPLOYEES
SHAREHOLDERS
FINANCIAL REPORT
USERS & OUTSIDERS

9. Q4. DO YOU THINK THE SITUATION THAT
REQUIRED THE DECISION COULD HAVE
YES BEEN AVOIDED? IF SO, HOW?
CENTRALIZED
VS
DECENTRALIZED
INTERNAL
CONTROL
CORPORATE
GOVERNANCE

10. Q5: Would you have made a different
decision? If yes, what would it have
been and why? If not, why?
NO