Don't hold your breath over Guinness report

So finally, finally, after all these years, the Department of Trade and Industry is to publish its report on the Guinness affair. It might actually do so as early as next week, although the DTI was yesterday casting doubt on whether it could be ready quite so soon. The spark for this belated little act of public service is next Tuesday's ruling by the European Court of Human Rights in Strasbourg on whether Ernest Saunders, the former Guinness chairman, was unfairly tried over the Guinness shares fraud.

Whatever the judges have to say on the matter, the DTI takes the view that it is now free to publish the results of its 10-year investigation of how Guinness illegally won control of Distillers in the mid-1980s. Conspiracy theorists will believe the timing is dictated by the Government's desire to deflect attention from what is all too likely to be another slap in the face for British justice from the European courts. Europe might wish to say, or at least imply, that Mr Saunders and others didn't get a fair trial, but this report will claim in the strongest possible language that he is as guilty as sin. The Serious Fraud Office will fight tooth and nail to uphold the Guinness convictions, whatever the European court says.

I've followed the various twists and turns in the Guinness affair pretty closely over the years, but unfortunately I haven't yet been able to get my hands on a copy of the final version of this report. However, from reasonably well informed gossip and an earlier unpublished draft it is possible to surmise roughly what's in it. Don't hold your breath.

Ten years after the event and with numerous criminal and civil trials to sift the evidence, there isn't a great deal the inspectors can say which is genuinely new about this affair. The Guinness scandal has passed into history and that's what the report is - a history book. There are no significant changes in the law, corporate governance or City practice the inspectors can recommend, for the lessons have been largely learnt and generally acted upon, in so far as they ever can be.

It is, of course, the case that the inspectors can still pass judgment on individuals and organisations still alive and kicking - and they will - but it isn't going to surprise anyone to learn that Mr Saunders is a crook or that Morgan Grenfell, his City advisers at the time, disregarded accepted rules and practices.

From what I hear about this report, however, the inspectors have missed an opportunity. In their analysis, evidence and judgment, they mirror very closely the prosecution case aired in the various criminal proceedings. Broadly, this attempts to pin blame for the scandal on a small group of key people and to varying degrees on the organisations they represented.

The central allegation is that led by Mr Saunders they conspired one with another illegally to support the Guinness share price and that this was kept secret not only from the markets (for the trick would not have worked if everyone had known the share price was being artificially supported), but also everybody else at Guinness and its professional advisers. Ergo these are the culpable ones and everyone else - lawyers, accountants, City advisers and the like - is in the clear. Indeed the case goes rather further than that, for to work properly - as it plainly did in the first Guinness trial - it needs you to believe that no one outside this inner core had any conception of what was going on. Moreover, they would have been profoundly shocked and tried to stop it had they known.

I've never believed this to be the full picture. It is largely true but the real story is more complicated - that the Guinness affair took place against a well established backdrop of cavalier practice and behaviour that encouraged the main protagonists into believing that if this was not quite the accepted way of doing things it was common enough at least to be tolerated. In some City firms practice of this sort was endemic, going unchecked either by internal controls or outside regulators.

I'm not saying here that any of the professionals caught up in the Guinness affair knew what was going on or even that they should have been officiously running around the place saying there's something wrong here and we are going to find out about it. No one ever starts in these situations from the point of view that their client is a crook nor is it their job to act as watchdogs over the activities of others.

All the same, it seems astonishing that nobody suspected what was going on. At the very least they should have been more vigorous in their approach. In the cut and thrust of a contested takeover an anything goes culture rapidly takes hold. It is reasonable to expect established practitioners in these matters to keep things in check. Even after DTI inspectors were sent into Guinness the attitude among some remained one of relaxed complacency right up to the moment when the full enormity of the scandal emerged. Then everyone ran for cover.

The Ernest Saunders version of events, that all these professionals knew what was going on and conspired to pin the whole saga on him, is absurd. But with so many highly paid, top-drawer names around the table to advise and guide him, it is hard to understand how this could have been allowed to happen, even now, 10 years after the event. There won't be much of this in the DTI report, however. The possibility that the whole thing might have been avoided had a more vigorous and professional approach been adopted is simply not addressed. This is a shame for it might have led to a more rounded and illuminating report. The inspectors were in a position to tackle the question of whether the night watchman was asleep on the job. They appear to have decided not to.

Nobody should be too surprised by the spectacle of Duncan Lewis flouncing out of his Granada TV job so soon after joining. Incompatibility seems to be his middle name. He did much the same thing when he was at Cable & Wireless's Mercury Communications subsidiary. He lasted barely more than a year there too. Gerry Robinson and Charles Allen are hard task masters, applying a vigorous regime of management control and accountability throughout the Granada empire. In never seemed very likely that they would be able to work happily with Mr Lewis.

He'll claim that he was never allowed the money or flexibility to do what he wanted with Granada's television interests. They'll claim he couldn't run a .... That's what happens when you get a difference of approach in business. The real problem, I suspect, is that Mr Lewis wants to be his own boss. He wasn't, either at Mercury or Granada. Mr Lewis is the type of executive who needs to be running his own show.

Arts and Entertainment
arts + entsWith one of the best comic roles around, it's no wonder she rarely bothers with films
Davis says: 'My career has been about filling a niche - there were fewer short actors and fewer roles – but now I'm being offered all kinds of things'
PeopleWarwick Davis on Ricky Gervais, Harry Potter and his perfect role
A Russian hunter at the Medved bear-hunting lodge in Siberia
Save the tigerWildlife charities turn to those who kill animals to help save them
Frank Lampard will pass Billy Wright and equal Bobby Charton’s caps tally of 106 caps against
sportFormer Chelsea midfielder in Etihad stopgap before New York contract
Usain Bolt of Jamaica smiles and shakes hands with a competitor after Jamaica won their first heat in the men's 4x100m relay
ebookA unique anthology of reporting and analysis of a crucial period of history
Chancellor George Osborne, along with the Prime Minister, have been 'complacently claiming the economy is now fixed', according to shadow Chancellor Ed Balls
i100... which is awkward, because he is their boss, after all
Arts and Entertainment
The first film introduced Daniel Radcliffe to our screens, pictured here as he prepares to board the train to Hogwarts for the first time.
booksHow reading Harry Potter helps children grow up to be gay-friendly
Life and Style
A small bag of the drug Ecstasy
Life and Style
Floral-print swim shorts, £26, by Topman,; sunglasses, £215, by Paul Smith,
FashionBag yourself the perfect pair
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Financial Analyst - Forecasting - Yorkshire

£300 - £350 per day: Orgtel: Financial Analyst, Forecasting, Halifax, Banking,...

Business Architect - Bristol - £500 per day

£500 per day: Orgtel: Business Architect - Banking - Bristol - £500 per day A...

Regulatory Reporting-MI-Bank-Cardiff-£300/day

£200 - £500 per day + competitive: Orgtel: I am currently working on a large p...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Day In a Page

Save the Tiger: Meet the hunters tasked with protecting Russia's rare Amur tiger

Hunters protect Russia's rare Amur tiger

In an unusual move, wildlife charities have enlisted those who kill animals to help save them. Oliver Poole travels to Siberia to investigate
Transfers: How has your club fared in summer sales?

How has your club fared in summer sales?

Who have bagged the bargain buys and who have landed the giant turkeys
Warwick Davis: The British actor on Ricky Gervais, how the Harry Potter set became his office, and why he'd like to play a spy

'I'm a realist; I know how hard this business is'

Warwick Davis on Ricky Gervais, Harry Potter and his perfect role
The best swim shorts for men: Bag yourself the perfect pair and make a splash this summer

The best swim shorts for men

Bag yourself the perfect pair and make a splash this summer
Has Ukip’s Glastonbury branch really been possessed by the devil?

Has Ukip’s Glastonbury branch really been possessed by the devil?

Meet the couple blamed for bringing Lucifer into local politics
Dress the Gaza situation up all you like, but the truth hurts

Robert Fisk on Gaza conflict

Dress the situation up all you like, but the truth hurts
Save the tiger: Tiger, tiger burning less brightly as numbers plummet

Tiger, tiger burning less brightly

When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

In grandfather's footsteps

5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

Martha Stewart has flying robot

The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

Do women cyclists need 'pootling lanes'?

Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

A tale of two presidents

George W Bush downs his paintbrush to pen father’s life story
Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

The dining car makes a comeback

Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

Gallery rage

How are institutions tackling the discomfort of overcrowding this summer?
Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

Eye on the prize

Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

Women's rugby

Tamara Taylor adds fuel to the ire in quest to land World Cup