Hanley was educated at Rugby School, and began his career with Peat Marwick Mitchell & Company (now KPMG) as an articled clerk in 1963. He qualified as a chartered accountant in 1969, and as a Chartered Certified Accountant and chartered secretary in 1980. He joined the Financial Training Company, responsible for training chartered accountants, as a lecturer in Law and Accountancy (now Kaplan Financial Ltd), and rose to become the organisation's deputy chairman.
In 1994, Hanley was brought into the Cabinet by Prime Minister John Major, who made him the Chairman of the Conservative Party and a minister without portfolio. He served in this position until the 1995 Cabinet reshuffle, when he was moved to the non-Cabinet role of Minister of State at the Foreign Office, where he remained until the 1997 general election.
Hanley's Richmond and Barnes constituency was abolished as part of a redrawing of constituency boundaries ahead of the 1997 election. He stood as the Conservative candidate for the new constituency of Richmond Park, but was defeated by the Liberal Democrat candidate Jenny Tonge.
Since leaving politics, Hanley has served on a number of company boards and as a director of the Arab-British Chamber of Commerce.
Hanley is the son of actors Jimmy Hanley and Dinah Sheridan. His sister, Jenny Hanley, became an actress and TV presenter in the 1970s. In 1983 he appeared alongside Jenny in a celebrity special of Family Fortunes.[3] In 1973 he married Verna, Viscountess Villiers, (née Stott, former wife of George Henry Child Villiers, Viscount Villiers, d. 1998) and had one son. He also had one son by a previous marriage and one step daughter.[4]