MT 40: Villains & Heroes

Like any great human endeavour, business has its share of the good, the bad and the ugly to brighten or darken the firmament. Matthew Gwyther and Andrew Saunders separate sinners from saints.

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Last Updated: 27 Jan 2016

ROGUES GALLERY ...

JOHN DELOREAN

Infamous sports-car 'tycoon' John DeLorean was a nimble-footed conman, whose career as a swindler pre-dated his entry into the US auto industry of the 1950s. As an engineering student in Detroit in 1948, he sent bogus invoices to 2,700 advertisers in the local Yellow Pages requesting the money be paid to his own newly formed company.

He escaped jail for this scam, as he did on many other occasions before his death in 2005.

On leaving General Motors in 1973, he began raising money for what he rather ironically described as an 'ethical' sports car, the stainless-steel, gull-winged DMC coupe of Back to the Future movie fame. Hollywood stars, including Johnny Cash and Sammy Davis Jr, handed over millions of dollars to DeLorean, but it was the British taxpayer who ended up taking the biggest bath of all.

In 1978, Northern Ireland Secretary Roy Mason proudly announced a deal had been done for the DMC to be built in a factory near Belfast, creating 2,500 jobs.

Production didn't begin until 1981, by which time Margaret Thatcher was PM, but DeLorean pulled the wool over her eyes too. The company went bankrupt in 1982, having received £78 million of taxpayers' money in return for a mere 8,500 cars - a subsidy of over £9,000 per car. Even DeLorean's famous chiselled chin was fake - a silicon implant gave him his matinee-idol profile - but he was cleared of fraud charges in 1986.

ROBERT MAXWELL

When his 20-stone bulk fell off the back of his luxury yacht, The Lady Ghislaine, on 5 November 1991, close to the Canary Islands, Robert Maxwell took his nastiest secrets with him. Was he an agent of Israeli intelligence? Was he guilty of war crimes in Germany in 1945? Did he ever tell a truth in his life?

Born Jan Hoch into grim poverty in Slovakia in 1923, Maxwell escaped the Nazi invasion and came to the UK in 1940 as a refugee. He joined the British army and finished the war as a captain; he was awarded the Military Cross in 1945, the year in which he killed the mayor of a German town.

Maxwell built a massive printing and publishing empire in the UK and abroad, but he ran into trouble with the authorities as early as 1969, when the DTI judged him unfit to lead a public company.

His death - accident, suicide or murder? - left a terrible legacy when it emerged that he had stolen hundreds of millions of pounds from his companies' pension funds, including that of the Mirror Group, to finance corporate debt, frantic takeovers and a lavish lifestyle. Thousands of Maxwell employees lost their pensions.

Gross in his personal habits, Captain Bob was the worst sort of bully and gave business a bad name. His litigiousness prevented investigations into his business dealings and he enjoyed the reputation of having stolen money even from Mother Teresa.

ERNEST SAUNDERS

Convicted fraudster 'Deadly' Ernest Saunders made medical history as the only recorded sufferer of Alzheimer's disease to make a recovery.

A prime mover in the Guinness affair, Saunders was jailed for five years for false accounting, theft and conspiracy after a six-month trial in 1990. His sentence was halved on appeal and he was released from an open prison after serving only 10 months, when the Court of Appeal accepted doctors' advice that he was suffering from pre-senile dementia. He's now a lot better.

Born Ernest Schleyer, Saunders escaped Nazi Austria in 1938, aged three. He had a management career with Beecham and Nestle before becoming Guinness CEO in 1981.

He was one of the so-called Guinness Four, along with Gerald Ronson, Jack Lyons and Anthony 'The Animal' Parnes. The Guinness share-trading fraud was the most famous British business scandal of the 1980s. It involved an attempt to manipulate the stock market to ramp up the price of Guinness shares and assist a £2.7 billion takeover bid for the Scottish booze company Distillers.

Saunders first came to the attention of the boys in blue after the arrest for insider dealing and subsequent squealing of Ivan Boesky, the notorious US arbitrageur who coined the phrase 'greed is good', made famous in the film Wall Street. After his recovery, Saunders acted as an adviser to, among others, Carphone Warehouse.

ASIL NADIR

Born in Cyprus in 1941, Asil Nadir was a classic '80s here-today/gone-tomorrow tycoon, who led the British conglomerate Polly Peck. By July 1990, one month before his empire began to unstitch, the former rag trader sat atop a £2 billion FTSE-100 company and was 36th in the Sunday Times Rich List, with an estimated £200 million fortune.

This was achieved through a dizzying sequence of apparently ingenious acquisitions, ranging from Sansui Electronics to the old Del Monte fruit business. Nadir owned a London mansion and a country estate, and revelled in his status as a friend of the rich and powerful. But financial transparency was not his forte. Charged with 66 counts of theft and fraud amounting to £34 million, he promptly skipped the country in May 1993 to northern Cyprus - which has no extradition treaty with the UK - before his trial.

Nadir was a long-time contributor to the Tory party and was involved in the downfall of Northern Ireland minister Michael Mates. It was found that in 1993 Nadir had paid Mates to ask questions on his behalf in parliament. Mates was forced to resign.

Nadir remains to this day holed-up in a villa on a hill outside Nicosia, although in recent years he has tried to do a deal with the SFO that would involve him returning to the UK for trial without being placed in the slammer. However, the British authorities gave him no choice, but a spell in striped pyjamas.

NICK LEESON

Back in early 1995, a Hong Kong futures trader called Nick Leeson disappeared, leaving only a note on his desk saying 'I'm sorry'. Before long his employer, the venerable London City bank Barings, would be even sorrier, as disastrous losses run up by Leeson and his colleagues came to light. The sum eventually totalled about £860 million, more than twice Barings' entire capital.

The world's first merchant bank, 233 years old, was eventually sold for £1 to Dutch rival ING.

Not a bad few days' work for the 28-year-old son of a plasterer from Watford. Leeson soon turned up in Frankfurt, where he was promptly arrested and taken back to Singapore to stand trial. He eventually served four and half years in the infamous Changi jail, during which time his wife divorced him and he developed cancer of the colon.

The story of Leeson's rise and fall - made into the film Rogue Trader, starring Ewan McGregor - did nothing to dispel the popular view that the City was a greedy and venal place where anything went in the pursuit of money. It also exposed some dangerous practices at Barings, which effectively had been allowing Leeson to police his own trades, and made it clear that bosses at the bank that had financed the Napoleonic Wars were out of their depth in the new high-tech money markets of the mid '90s. Leeson has remarried and now lives in Galway, Republic of Ireland.

THE ANGELIC HOST OF ENTERPRISE

SIR RICHARD BRANSON

What heroic list would be complete without Old Beardy, the branded venture capitalist who still tops every business vox pop, despite having been at it for over 35 years now? A powerboating, ballooning, swashbuckling seeker of the photo-opportunity, Richard Branson's name has become a generic term for entrepreneurialism. He has started businesses in everything from magazines to records to trains, cola to cosmetics.

No bootstrap boy from a Hovis landscape, Branson was educated at Stowe but didn't shine academically. To prove that a privileged background isn't always a bar to enterprise, it was at school that he set up his first business, Student magazine, aged just 16.

By 17 he'd also set up the Student Advisory Centre, a charity designed to help young people. In 1970 he founded Virgin as a mail-order record retailer, also opening a record shop on London's Oxford Street. In 1972 the first Virgin artist, Mike Oldfield, recorded Tubular Bells, which went on to sell more than 5 million copies. In the early '90s, Branson sold up in music to found an airline - a money-pit for capital at the best of times.

He has suffered a number of setbacks recently - a failure to wrest the lottery from Camelot, dark talk about the Byzantine nature of his finances and the profits all going offshore, and some seriously bad publicity about the punctuality of his trains. Now 56, Branson is sui generis: a survivor and an icon.

LORD WEINSTOCK

Arnold Weinstock was Britain's last great industrialist, a man of tremendous personal power and influence whose management dictums remain - for good and ill - standard practice in many of the nation's boardrooms.

The youngest of six, Weinstock was orphaned at 10. He took over the helm at what became GEC in 1963 and embarked on a decades-long programme of acquisition and cost-reduction, creating the definitive diversified conglomerate before finally retiring in 1996. He died aged 77 in 2002.

At its peak, GEC was an £11 billion powerhouse, employing more than 240,000 people and making everything from televisions and telephones to radar and power equipment. Weinstock sat in his spartan office in Stanhope Gate in London, carefully controlling the lot. He was famously cost-averse, even insisting that all lights be turned off at night, and fond of making surprise calls to managers, grilling them on their latest accounts.

Such attention to detail created vast amounts of what we would now call 'shareholder value', but Weinstock's approach was not without flaws. There was too much reliance on the boss and stringent cost controls resulted in failure to exploit new markets. After his retirement, a monstrously bungled attempt to tackle this latter problem led to financial ruin for Marconi (as it had become known) and the tragic break-up of what had once been the jewel in the crown of UK plc.

DAME ANITA RODDICK

Co-founder with her husband Gordon in 1976 of earth-friendly cosmetics chain, the Body Shop, Anita Roddick broke the business rules on a number of counts: she was a woman, she despised the City (describing financiers as 'pin-striped dinosaurs') and she had ethics.

Born in Littlehampton in 1942, over the past 30 years, she has managed to turn a shop selling hand-made, ethically sourced cosmetics in the backstreets of her home town into a global brand worth millions. The Body Shop was one of the icons of the high street in the 1980s, the unconventional Roddick a champion of a new, caring, consumerism. In the 1990s, the business became Britain's most successful international retailer and it now has more than 2,000 shops in 54 countries. It employs around 6,000 people, either directly or through franchises.

Not bad going for the daughter of Italian immigrants who went into retailing only because she was tired of running a cafe and wanted a job with sensible hours.

Roddick's preachy style irritates some, but she was a pioneer of corporate social responsibility long before anyone else had thought of it. More recently, critics said the business had lost its way, but Roddick had the last laugh. She sold the Body Shop to L'Oreal in a deal worth £652 million earlier this year, pocketing a cool £130 million for herself and Gordon, despite a deluge of criticism from her ethical mates.

THE ANGELIC HOST OF ENTERPRISE

JAMES DYSON

Bagless vacuum cleaner boffin James Dyson's story is a classic of the Barnes Wallis plucky British inventor genre, a tale in which brains and determination take on vastly superior forces and end up winning the day.

Cue the Dambusters March and a flight of Lancaster bombers roaring off into the sunset.

Born in 1947 into a long line of teachers and vicars, Dyson graduated from the RCA and had his first big success as an inventor with the Ballbarrow in 1977. He used the money to fund what would become a 15-year obsession - the super-efficient cyclone vacuum cleaner. After 5,000 prototypes, it finally hit the shops here in 1993 - Dyson had been forced to make it himself and to defend numerous lawsuits along the way. Despite being told by the industry that his ideas were worthless, the DC-01 cleaner rapidly became the nation's bestseller. By the late '90s, he was sitting on a £500 million fortune, with a factory in Wiltshire employing 1,300 people and a growing reputation as just the kind of entrepreneur the country needed more of.

The DC-01 and its descendants continue to do well, particularly in the US, but other products - such as the Contrarotator washing machine - have not. His biggest wobble came in 2003 when he offshored his manufacturing operations to Malaysia, having promised to keep them at home only a year before. He's now worth over a billion quid and is the country's 48th-richest individual.

SIR TERRY LEAHY

Terry Leahy is Britain's premier business leader of the 21st century. Love it or hate it, embrace him or spurn him, Tesco and CEO Leahy put others in the shade when it comes to unstoppable expansionism. Leahy repeatedly wins MT's annual award as the UK's Most Admired Business Leader.

The Tesco story is one of unwavering success: it has more than 1,700 stores; it is the UK's largest private-sector employer, providing a living for 237,000 people; and it makes £2 billion a year in profit. Tesco.com is the world's most successful online grocer.

Tesco under Leahy is sure-footed, systematic and tightly managed. Its competitiveness is exemplary: in 2003, the company was taking a remarkable £1 in every £8 spent in the nation's shops. Today, it's closer to £1 in £7, thanks to hugely successful brand extensions into everything from televisions and DVDs to car insurance and banking. But its dominance worries people, and presenting a cuddlier, more caring, CSR-centred face to the world is high on Tesco's agenda.

Unwaveringly modest in public, Leahy worked his way up from the shop floor and is completely without airs and graces. More Everyman than flamboyant maverick, some call him boring - a man who will talk about nothing but his beloved Tesco.

But what Leahy may lack in colour, he more than makes up for in his relentless pursuit of retail efficiency.

THE JURY'S OUT

LORD HANSON

For many devotees of the Thatcherite miracle, James Hanson, born in Huddersfield in 1922, is unquestionably a hero. He was certainly our most successful corporate raider, building up a huge empire in the '70s and '80s, buying underperforming businesses and doing what modern-day private-equity operators call 'unlocking hidden value'.

But his modus operandi - cut costs, slash jobs and make a killing - meant that for many whose path he crossed Hanson was a reviled figure, a corporate Grim Reaper sucking the life out of one firm before moving on to the next.

In his youth, he was engaged for a year to Audrey Hepburn (she called it off); he died in 2004, aged 82.

ROLAND 'TINY' ROWLAND

The legendary swashbuckling entrepreneur and creator of the Lonhro conglomerate, famous for everything in Africa from mines to car dealing, Tiny Rowland (1917-1998) saw himself as a latter-day Cecil Rhodes. Lonrho became one of Britain's biggest companies, acquiring the Observer newspaper en route, but Rowland spent a disproportionate amount of time running a bitter feud with Mohamed al-Fayed after the Egyptian had beaten him to the ownership of Harrods. Former British prime minister Edward Heath once described Rowland's business methods as 'the unacceptable face of capitalism'.

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