4230 Hw 3

860 Words Oct 17th, 2014 4 Pages
1. Corporate malfeasance is defined as deceptive and/or fraudulent activities carried out by corporate officers. Usually the CEO is held responsible for corporate problems, but a firm’s board is essential to preventing malfeasance and ensuring that management acts with integrity. I would describe some of Messier’s actions as corporate malfeasance. For example, Messier repurchased a significant amount of Vivendi Universal’s stock (i.e., 6.4 billion Euros from 2001-2002) to fund employee stock option grants. Because Messier was so focused on the firm’s stock, his focus was not on the firm’s financial stability nor did he make the best use of excess cash. Further, the accounting rules used were questionable, as Vivendi Universal used, and …show more content…
Messier was dedicated to Americanizing the firm, taking away from its French heritage. When Messier decided to sell off Vivendi Environment, the parent company’s most profitable business, to finance a deal with USA Networks he continued to transform the firm into a media first business neglecting the firm’s water supply roots. Now the parent company was left with debt and many overvalued assets. Vivendi Universal would eventually have to write down significant amounts due to excessive goodwill estimates from acquisitions. Messier was stubborn. He declared that these loses were not reflective of the company’s sound operations and tried to blame Lescure, the decision-maker for Canal Plus, for the parent company’s business failure, deeming Canal Plus as a tumor for Vivendi Universal. All in all, Messier was adamant in keeping to the story that his firm was in good financial position, and, because he had the support of board members (who he had initially appointed), others believed this story as well. His persistence in growing the business fogged his perception of reality—he was managing a failing business. It is clear that Messier did a poor job as CEO.

3. Messier was a victim of bad timing, however, his failure as a CEO should not only be attributed to poor timing. Yes, the dot.com bubble burst during his tenure, which may have caused him to over value some acquired firms. Other issues

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