feisty
The IPO is supposed to be the moment a founder hands something over. Capital comes in, public shareholders arrive, and a new governance structure locks into place around a business the founder built largely alone. In practice, many Australian founders don't hand anything over at all. They stay on as CEO, or as chair, or sometimes as both, and the tension that creates is one of the least discussed dynamics in ASX boardrooms.
Staying on isn't inherently a problem. Some of the most consistent performers on the ASX have been founder-led for years post-listing. But the transition from private company to public company changes the rules of the game whether the founder acknowledges it or not.
The governance gap that opens at listing
Before an IPO, a founder controls the company almost entirely. They set strategy, hire and fire executives, and answer to a small group of investors who typically share their long-term outlook. After listing, they answer to a board with independent directors, institutional shareholders with quarterly reporting expectations, and regulators with continuous disclosure obligations.
The founder hasn't changed. The accountability structure has.
This is where the governance gap opens. Many founders who list their companies have never had a board that can genuinely hold them accountable. The independent directors appointed pre-IPO are often chosen by the founder, which shapes the power dynamic from day one. A board that the CEO assembled is structurally different from a board that assembled itself.
The chair role is where this becomes most acute. A founder who lists as both CEO and chair concentrates power in a way that ASX Corporate Governance Council guidelines explicitly discourage. The Council's principles recommend separating the roles, and institutional investors, particularly large superannuation funds, push back on combined structures. Founders who resist that separation often face their first real board fight within 18 months of listing.
What the CFO's role becomes
In a private founder-led company, the CFO is often a trusted operator who reports directly to the founder and implements financial decisions rather than driving them. Post-IPO, that relationship has to change. The CFO now has obligations to the ASX, to auditors, and to the continuous disclosure regime that sit independent of whatever the founder wants.
Founders who understand this early tend to appoint a CFO with listed company experience before they go public, sometimes 12 to 18 months before the IPO. Founders who don't often find themselves replacing the CFO within two years of listing, once the gap between what the role requires and what the incumbent can deliver becomes visible to the board.
The CFO-to-CEO transition is a related pressure point. In founder-led companies, the CFO rarely moves up because the founder isn't moving out. That bottleneck affects retention of strong finance talent, particularly as those candidates get recruited by companies where the path to the top is clearer.
Institutional shareholders change the conversation
Before listing, a founder negotiates with a small number of sophisticated investors who accept founder control as part of the deal. Post-IPO, the shareholder base broadens fast. Index funds hold the stock by mandate. Superannuation funds take positions. Each brings its own governance framework, proxy adviser relationships, and voting policies.
Founders frequently underestimate how differently these shareholders engage compared to their pre-IPO backers. A venture or private equity investor who backed the founder early accepted asymmetric information and founder control as features of the investment. A super fund doesn't. It expects transparent disclosures, independent board oversight, and executive remuneration that ties to measurable outcomes.
The AGM becomes the first real test. A founder who has never had to defend their remuneration package to a room of institutional shareholders often finds the experience jarring. A protest vote on rem is common within the first two years of listing for companies where the founder retained outsized control of the pay-setting process.
The dual-class share structure question
Some founders try to solve the control problem structurally before listing by issuing dual-class shares that give them weighted voting rights. This is less common on the ASX than on US exchanges, partly because the ASX Listing Rules and major proxy advisers treat it with considerable scepticism, and partly because large Australian institutional investors will price the governance discount into the shares at IPO.
Founders who push for dual-class structures on the ASX typically find the conversation ends quickly. The institutional investors whose support is needed for a successful IPO simply don't want it. A handful of technology companies have listed with modified structures, but they remain exceptions rather than precedents.
When the founder's presence becomes a liability
Most founders who stay on post-IPO do so because investors want them there. The founder's vision, relationships, and domain expertise are often core to the investment thesis. But the conditions that make a founder an asset can reverse.
Three situations recur. First, a strategic pivot that the market doesn't trust the founder to execute, typically when the original market is contracting and the new one requires a different operating model. Second, a governance incident where the founder's informal decision-making style produces a disclosure failure or a related-party transaction that attracts regulatory scrutiny. Third, a performance slide where the board needs to signal to shareholders that accountability exists, and removing the founder is the clearest signal available.
In each of these situations, the board faces a version of the same problem it faces in any CEO removal: the 90 days after the decision are the most exposed period for the company. The difference in a founder-led business is that the founder often controls a substantial shareholding, which means their cooperation with the transition matters in ways it doesn't with a professional CEO. A founder who departs loudly can do material damage to the share price and to staff confidence.
The boards that manage this best tend to have spent time on succession well before the moment arrives. The question of what comes after the founder isn't a pleasant one for a founder-aligned board to raise, but the companies where it gets raised early are the ones that handle the eventual transition without a crisis. As with any succession plan that fails, the cost of avoiding the conversation is usually higher than the cost of having it.
What the best post-IPO founder transitions look like
The pattern that works isn't the founder disappearing. It's the founder redefining their role in a way that the governance structure can actually support.
In practice, that means separating the chair and CEO roles within two to three years of listing, even if the founder retains one of them. It means appointing a CFO with listed company experience, not promoting the person who did the job when it was simpler. It means building an independent board that genuinely challenges the founder's decisions rather than endorsing them.
It also means the founder accepting, usually for the first time, that they no longer own the strategy outright. Institutional shareholders have a legitimate claim on capital allocation decisions. The board has a legitimate claim on CEO succession and remuneration. The CFO has obligations to the market that don't pass through the founder's approval.
Founders who make peace with that shift early tend to remain valuable to the business for a long time. Those who don't usually find the board making the peace for them, on a timetable the founder didn't choose.