Professional Life
He had a career in management with Beecham, Great Universal Stores and Nestlé before becoming chief executive of Guinness plc (now a part of Diageo plc) in 1981, remaining in the position until 1986. He was renowned for his ruthless cost-cutting efficiency, earning from his employees the sobriquet 'Deadly Ernest'.
Under his charge, early in 1986, Guinness plc launched a friendly takeover bid for Edinburgh-based United Distillers plc, which was being stalked by a hostile bidder. This was effected by quietly boosting the Guinness share price. Subsequent to the bid, which resulted in success for Guinness, Saunders (along with Jack Lyons, Anthony Parnes and Gerald Ronson) was charged and convicted on 27 August 1990 of counts of conspiracy to contravene section 13(1)(a)(i) of the Prevention of Fraud (Investments) Act 1958, false accounting and theft, in relation to dishonest conduct in a share support operation (see Guinness share-trading fraud). A series of appeals was finally dismissed in December 2002, although a ruling by the European Court of Human Rights in Saunders v. the United Kingdom declared that the defendants were denied a fair trial by being compelled to provide potentially self-incriminatory information to Department of Trade and Industry inspectors which was then used as primary evidence against them. This breached their right to silence.
While there was no suggestion that Saunders himself sought to or actually did profit from these offences in an immediate or direct manner, the allegation was that they were committed to increase the likelihood of their company's takeover bid succeeding. His board of directors at Guinness plc was not informed of, and had not sanctioned, his arrangements, which included indemnities for unknowable amounts. He had passed $100 million to the American Ivan Boesky to invest shortly before Boesky's prosecution and imprisonment for insider trading, and following that investigation Saunders' plans were revealed to the DTI in Britain.
Read more about this topic: Ernest Saunders
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