Solyndra LLC: Ethical And Legal Issues

Ethical and Legal Issues Behind Solyndra

Solyndra LLC., a solar based company who’s primarily responsible for the production of solar panels, was the very first company to receive funding from the U.S. Government as part of a clean energy project requested during the George W. Bush administration (Grumwald, 2011). The loan guarantee was under the Energy Policy Act of 2005, was led by the Department of Energy, and approved by the Office of Management and Budget once President Obama took office. The loan guarantee that was finally approved in 2009 under Obama’s administration as part of a stimulus bill he acquired and amounted to $535 million which was used to open a second factory out of their California location (Bowers, 2011). Solyndra’s

While Bankruptcy can be seen as a negative tactic whether it’s done by a person or a corporation, it is actually a business decision (United States, n.d.). Solyndra filed for Chapter 11 Bankruptcy mainly to reorganize their assets and pay off the creditors and investors involved. However, many reports indicate that the government may not get any of that money invested but instead the private investors and other officers of the company might be able to keep some portions of it. This in the eyes of the Department of Justice and the IRS are sufficient grounds to state that the bankruptcy move was unethical. In the end, Solyndra won its case and the Bankruptcy court granted what they asked for (Bankruptcy Court,

Internal analysts forewarned that the project to fund Solyndra might not be a good move since they thought that they would be out of money by September 2011(Murphy, 2012). Coincidently, the same month and year the company went bankrupt and closed operations. It has been proven that the Department of Energy tried to warn the Obama Administration that Solyndra would eventually run out of money and investing would cost taxpayers more money in the long run (Ten Lessons of, 2012). Additionally, it has been speculated that the company made themselves look better financially by altering financial statements. Corporate Social Responsibility and the Sarbanes-Oxley Act of 2002 (SOX) come into play in this scenario. Corporate Social Responsibility can be traced back to Milton Friedman back in the 1970s in an article that states that the company does not hold responsibility to its shareholders but each individual working within that company (Friedman, 1970). Somebody failed in this company for sure and a lot of irresponsible corporate decisions were made to acquire such loan. Finally, the SOX act I think plays part in the fact that who actually audited this company and where did all the profits or losses go when it came time to pay back on the loan they received from the government. If the company had obvious financial issues that an expert caught at the