If Richard Dunhill didn't exist, his company would probably invent him. No casting agency could have selected a man so perfectly tailored for his role as Chairman of the Board. With his aristocratic head of silver hair, sculptured grey beard and urbane manner, he looks like an elder statesman; he epitomizes the qualities which his firm represents, and to which its customers devoutly aspire: elegance, refinement and class.

Mr. Dunhill bears a striking resemblance to his grandfather Alfred who founded the firm, even to the pipe he puffs. While we talk in his London office, the tobacco which he mixes for himself from 16 exotic blends perfumes the stately room with a sweet yet masculine aroma that suggest after-dinner port taken in the library. Such is his air of understatement that even his solid gold laticed watchband seems to peer discreetly from inside the immaculately stitched sleeve of his classic grey suit.

The man whom staff called "Mr. Richard" has an avuncular twinkle in his eye but wisps of gentle mockey curl about the office along with the smoke . Richard Dunhill's style displays nothing so blatant as charisma, and his well-bred distance owes more to reticence than remoteness. Finesse restrains him from claiming any personal credit for the company's achievements. He recoils visibly when confronted with personal questions and ascribes the firm's success to team effort.

Although Dunhill became a public company in 1923, Richard is the third generation Dunhill to be its chairman. "It is desirable for the head of the company to be identified with its products," he says. "The tradition which my grandfather started has been maintained because the family was more conscious of his standards than other would have been. This gives continuity to the company and confidence to the customers."

Each generation has made an outstanding contribution to the company. "When my grandfather retired he was convinced the company would collapse, but his brother Herbert, a financial wizard, ran it by remote control from Monte Carlo!" Mr. Dunhill chuckles. His Aunt Mary who preceded him as Chairperson was a grandmother figure who occasionally smoked a pipe. An astute businesswoman who expanded and diversified the company's operations, she was so dynamic that on the day she died, at the age of 81, she was out inspecting new merchandise!.

Richard Dunhill's identity is so tightly interwoven with the firm that when asked about his own personal goals, he quips, "Well, they can't promote me any further! As Chairman I've reached the end of the line, but what drives me now is the challenge of ensuring that this company continues to make profits and superbly crafted products."

Now aged 62, Richard Dunhill delights in having spent his entire working life in the service of the same company. He has never wanted to do anything else. "Ever since I was at school, I assumed that if I behaved myself I would become a director. That has always been my ambition."

But there was no nepotism at Dunhill after serving in the army, Alfred's grandson had to learn the business from the bottom.

"It taught me a great deal about the company. Besides, all I knew when I started was how to stick bayonets into people and how to signal in morse code! I certainly wasn't spoilt. I learnt a lot about pipes and lighters working in the repair division! In the wholesale order department, they gave me a car, which I wouldn't had." His desire to see the family involvement in the firm continue will probably be realized s his son Simon, 25, is currently marketing manager in the Smoker's Division of the company.

As we talk, a pale April sun slants through the windows and illuminates an 18th Century painting depicting a woman smoking a pipe - a self-portrait of one of the first women smokers, Mme Le Brun, he explains. Beside it hang other paintings of pipe smokers, part of his grandfather's collection. The family crest that hangs behind his desk, however, is a recent addition.

"I designed it two years ago", he says and points to the motto with the stem of his pipe. "Activity, Integrity and Enthusiasm. That's what I believe in." The emblems on the coat-of-arms are a horseshoe denoting his grandfather's original business, tobacco leaves symbolising the origins of this company, a torch signifying fire, and a clay pipe.

The Dunhill empire began in 1907 when Alfred Dunhill opened his tobacconist shop on the same site in Duke Street where the office and shop stand today. Richard Dunhill believes that his most valuable trait is adaptability. It was his grandfather's strength too. An entrepreneur and inventor, Alfred started work in his father's saddlery business. Smelling a whiff of petrol in the winds of change, his father turned to producing motor car accessories such as big mittens foot warmers and special hats. The Dunhill talent for inventing ingenious gadgets soon manifested itself with Alfred wind-resistant pipe whose tiny windshield stopped the tobacco from becoming an inferno as drivers tore along the roads in their cars. The success of this invention prompted him to open his own business, specializing in smoker's requisites.

Alfred's first customers were spoilt young fops with silver-topped canes and amber cigarette holders who revelled in the indulgence of having their personal blends mixed by the owner, recorded in his special book, and kept in a private humidor. Dunhill's famous cedar-panelled Humidor Room, filled with the Havana cigars that connoisseurs dream about, is still located at the back of the Duke Street shop.

Besides demonstrating a flair for creating a mystique around a commonplace activity, Alfred was determined to succeed by providing his customers with the best of everything and his philosophy that his merchandise must be useful, dependable, beautiful and the best of its kind, has remained Dunhill's guiding principle to this day.

As we sip Earl Grey tea, my gaze falls on a highly polished cabinet whose shelves display miniature scales, containers of tobacco and rows of pipes. Richard Dunhill smiles "Our do-it-yourself tobacco blending cabinet," he says. "We haven't made them for years. Another unusual item we used to make was a Leap year Pipe Case which had a different pipe for each day of the year. It contained 366 pipes arranged in 12 drawers, so that if the owner took a vacation he could remove that month's supply of pipes and take it with him! Sunday pipes had gold bands with a white gold emblem. Those were gimmicks and although not profitable, they did create interest. Today, our product range is more streamlined.

Imaginatively designed, superbly crafted products, sometimes with a whimsical touch, have always been Dunhill's trademarks, but over the decades their ingenuity has been tested by the eccentric requests of some of their illustrious patrons.

Stalin ordered a pipe with a solid gold mouthpiece; a curious request for the leader of the world's workers. King Farouk of Egypt wanted specially designed scissors to cut the hairs in his nose. One Japanese customer requested a lacquer cigarette case shaped like a sandwich with the ham protruding. Most bizarre was a request for a lighter covered with human skin. In the 1930s, an Indian Maharajah ordered a trick-opening box made of 18ct gold and swore the manager to secrecy about the way it opened. The following day, the Prince of Wales' equerry arrived at Duke Street with an urgent Royal Command: His Royal Highness was consumed with impatient to learn how to open his tantalizing gift!

The list of Dunhill's patrons reads like a who's who, not just of English aristocracy but all the royalty of Europe as well as the shakers, movers and entertainers of the world. Winston Churchill made some of his most vital decisions while smoking Dunhill cigars, as did John F. Kennedy. Over the years clients browsing in the House of Dunhill rubbed shoulders with Anna Pavlova, Somerset Maugham, Rudolph Valentino, the Marx Brothers and Frank Sinatra. In 1963 the firm received the ultimate stamp of approval in the Royal Appointment to the Queen.

Alfred Dunhill's inventive smoking accessories have become collectors' items. His most spectacular success was the "Unique" lighter in 1924. For the first time smokers had a reliable lighter whose horizontal flywheel mechanism made it spark every time, and which they could hold and operate in one hand. Luxury variants of the Unique lighter followed, one with a built-in watch. A sports model for open cars featured a windscreen around the flame. In 1930 a "Vanity" version for women incorporated a powder puff and lipstick. Always ahead of competitors, Dunhill went on to produce giant table lighters and pocket lighters, perfecting the mechanism with the roller technique and improving the fuel by introducing butane gas.

The man who buys a Dunhill product is also purchasing a distinctive image: gold standard masculinity coupled with an understated English elegance. Alfred Dunhill laid the foundation of this gentlemanly pipedream in the gracious days of Empire; today, as England hurtles towards Great Europe, his descendants continue to pander to the same nostalgic ideals with equal success. The Dunhill label seeks to confer membership to an exclusive club of English gentlemen who value quality above flair, tradition above trend. Unlike self-indulgent French bon vivants, or lusty Italians who pursue la Dolce Vita, the quintessential Dunhill gentleman reveres restraint, moderation, classical styles and subtle colours.

As I entered the Alfred Dunhill shop in London's West End, the liveried doorman ushered me into the elegant showroom. Points of light from the chandeliers danced on the intricately patterned parquet floor, on which lay an antique Persian rug. Tastefully arranged against wood-panelled walls and in glass-topped display cases was a selection of Dunhill merchandise: wallets, lighters, belts, ties umbrellas, pyjamas, shirts, suits, raincoats, travelling bags, sunglasses, toiletries, watches, pens and cufflinks.

I marvelled at an apparently seamless black travelling bag of butter-soft lambskin that almost melted at the touch. So cunningly designed, it secreted an attached case in a centre opening, so beautifully made that I could hardly believe a human hand had fashioned it. In a glass display case lay a seductive array of Masterpiece Montblanc fountain pens, elegant black bodies tapering into 14 carat gold nibs. The number engraved on the nib, 4810, is the height of the Mont Blanc in metres! At another counter the Elite watches entranced me with their thin casing and openwork link bracelet.

I picked up a slender lighter with a raised barley design in cool, satin-smooth gold plate which felt so good that I almost wished I smoked. It is interesting that the latest Dunhill lighter is a copy of Alfred's original Unique, except that this model is gas and flint-operated, and is also produced in 9ct solid gold.

A carousel of silk ties lay fanned out on a circular table. I asked the assistant why anyone should pay over $100 for a tie. As he patiently pointed out their unique features, I realized that these were not merely ties, they were marvels or sartorial engineering! First of all, they were made of the finest Italian silk, entirely hand-stitched and hand-pressed. Then there was the subtle pattern, exclusive to Dunhill, with the discreet encircled "d" at the base. This was no mass-produced item. Moreover, these ties were padded to ensure that they held their shape. The piece de resistance was a stiff plastic thread behind a narrow tab which when pulled down removed any creases.

Raising the question of price with the Chairman of Dunhill is a little like discussing the issue of privilege with the Queen: you know ahead what the reply will be, but you are not prepared to press your argument. "We place quality above everything, regardless of the time and effort involved, and many people are prepared to pay for our quality. We select the finest fabrics, and have our merchandise made by consummate craftsmen wherever we find them. So our lambswool is made in Scotland, pens in Germany, watches in Switzerland, fashions in Italy, and pipes here in England."

Alfred Dunhill once said that no gentleman is truly well-dressed without the subtle note of a fine masculine fragrance. He introduced fragrance into the range in 1936, but this aspect of Dunhill's merchandise was not successful until the new Editions fragrance and grooming range was launched in 1985.

Its distinctive sensual perfume of wild herbs and exotic spices results from a subtle blending of Italian lemon, petitgrain and Alpine lavender nils, with clary sage, basil and Asian galbanum, cedar and sandalwood.

At the far end of the shop are the smokers' requisites, their unobtrusive location an indication of this division's reduced role among Dunhill's enterprises. Twelve years ago, smokers' products accounted for almost 100% of the firm's sales: today they represent only 8%.

In 1981, Dunhill sold its tobacco business to Rothman's International, who continue to produce Dunhill brand cigarettes under licence. Rothman's is the major shareholder in Dunhill with a 50.6% holding. Like an empire built on slavery in its early years, Dunhill today plays down its association with tobacco. "We're a bit embarrassed about it," said Mr Dunhill, thoughtfully puffing on his pipe.

Behind the counter in the Dunhill showroom, an assistant weighs out 50 grams of rich Atlanta tobacco for a bowler-hatted customer. Its deliciously intense aroma makes my head swim. The wall is decorated with pipes, some as glossy as newly opened chestnuts, others knobbled with a shell finish. Each has the distinctive Dunhill mark, a white dot.

"Our pipes go through 90 processes before they are ready, and the mouthpiece is hand cut, not moulded," Richard Dunhill explains. "Our expert at the factory rejects 98% of all the pipes during some stage of their production because he finds cracks, splits or holes. It's true that you can buy a pipe for 25 pounds while ours cost from 70 pounds to one hundred and fifty pounds, but ours are perfect."

During the last ten years, under Richard Dunhill's direction, men's clothing has been introduced. "It has required a dramatic change of thinking for us to produce two new collections each year after producing merchandise that never dated," he said. Apart from their classic blazers and flannel slacks this summer customers will also be able to select clothes from Dunhill's current Varsity Collection, with its nostalgic evocation of languid college days.

"Our biggest change recently has been the introduction of strongly colour coordinated clothes," said Mr Dunhill. The Varsity collection even Co-ordinates belt and umbrellas! Richard Dunhill is amazed by the success of their menswear division. "It has certainly been one of our greatest triumphs, that after only 12 years we have become the largest supplier of luxury ties in the world!

The success of Dunhill's enterprise in Japan is probably unequalled by any other British company. Dunhill has 30 boutiques in Japanese department stores, each one an oasis of understated indulgence. Japan now accounts for one third of all its business.

Perhaps the biggest surprise in recent years has been Dunhill's acquisition of the French women's fashion and fragrance house, Chloe, which will continue under its own brand name. Dunhill have negotiated ready-to-wear licences for Chloe and Miss Chloe in Japan.

"Our basic strategy will continue to be the creation of a major international enterprise by acquisition and by internal growth," said Mr. Dunhill. "We expand further into fashion and custom-made tailoring, footwear, and we'll acquire more brand names. We have 700 million pounds available in cash. Who knows - we may get into sports services, perhaps even entertainment. The sky's the limit."

The day after our interview, Richard Dunhill was due to fly to Jamaica to select three gold teams to challenge the Australian champions later this year at St Andrews. With its prize of money of $US1.2 million, the Dunhill Cup is the richest golf tournament in the world. "One of our biggest challenges is to communicate our new diversified image to the public and sponsoring the Dunhill Cup is one means of doing that."

Richard was enthusiastic about his imminent visit to mainland China which is to compete in an international gold tournament for the first time since the Revolution outlawed golf as a capitalist pursuit. "As a member of some of the world's leading golf clubs, I should play much better than I do," he shakes his head gloomily. "Perhaps when I retire..." In the meantime, he relaxes landscaping his large Buckinghamshire garden and building models with antique meccano sets which he avidly collects.

Golf tournaments, women's fashions, boutiques in Australia and Japan ... Richard Dunhill leans forward smiling. 'My grandfather would probably have a seizure if he saw what we are doing. But I really think he'd be incredibly impressed."