During his reign as CEO, Dennis Kozlowski, who was reported as one of the top 25 corporate managers by BusinessWeek, siphoned hordes of money from Tyco, in the form of unapproved loans and fraudulent stock sales. In early 2002, the scandal slowly began to unravel and Tyco's share price plummeted nearly 80% in a six-week period. Kozlowski was convicted of crimes related to his receipt of $81 million in unauthorized bonuses, the purchase of art for $14.725 million and the payment by Tyco of a $20 million investment banking fee to Frank Walsh, a former Tyco director. He was sentenced to up to 25 years in prison. Tyco’s primary stakeholders included their shareholders, employees and customers. Their secondary stakeholders proved to be the SEC, the District Attorney of Manhattan, NY and the media, just to name a few.
#1: Dennis Kozlowski, CEO.
A: I believe that Kozlowski was in level one- the pre-conventional level of moral development. This is the level in which focus is generally on the self and where ethical egoism is dominant. Ethical egoism is based on the idea that the individual seeks to maximize his/her own self-interests; and this is exactly what Kozlowski did. Stage two of moral development is the seeking-of-rewards stage. At this stage, individuals might not completely understand the moral idea of “right” and “wrong” but rather learn to behave in accordance with the punishments or rewards that follow. Kozlowski enjoyed the rewards that came to him in terms of a lavish lifestyle and thus, continued to behave in the illegal way that he did. I do, however, believe that Kozlowski knew that his actions were wrong, but he chose to do them anyway. That is a total disregard of others, and thus proves he was not in more advanced levels of moral development.
B: It does not take long to see that Kozlowski’s approach to ethics was tremendously immoral. It has been