Succession, transition a challenge for founder CEOs: Joydeep Sengupta

At the Business Standard BFSI Insight Summit 2026, McKinsey's Sengupta said that founders must balance long-term ambition, take calculated risks, and plan succession to ensure business continuity

Succession planning remains a key challenge for business founders seeking to ensure their companies outlast them, Joydeep Sengupta, author and senior partner at McKinsey & Co., said at the Business Standard BFSI Insight Summit 2026 on Monday.

 

“The one Achilles heel is succession and transition. Two-thirds of them don’t manage succession very well,” Sengupta said during a session titled 'Shapers and Founders — The Inside Story of Asia’s Extraordinary CEOs' with Business Standard’s Ruchika Chitravanshi.

 

Drawing on interviews with 30 chief executives for the book, Sengupta said they revealed common traits among founder-CEOs, including the ability to balance long-term strategic thinking with a close focus on daily operations. He described this approach as having “a telescope in one eye and a microscope in another”. Sengupta added that the role requires maintaining a vision that would span decades while remaining attentive to immediate business decisions.

 

 

He also highlighted the importance of balancing innovation with the preservation of a company's core values. “Founders must be willing to pursue disruptive ideas and improve continuously, while protecting what is fundamental to their organisations and modernising traditional practices,” he said.

 

On risk-taking, Sengupta spoke against the popular perception that entrepreneurs and business owners have an insatiable appetite for risk and make big bets without worrying about the downside.

 

“Their risk appetite is defined by their degree of ambition and not the other way around,” he said, explaining that founders often determine the risks they are willing to take based on the scale of the business they want to build. 

 

Citing the example of David Ku, founder of China's WeBank, Sengupta said the entrepreneur chose to wait for a full banking licence rather than begin operations with a consumer finance licence, despite the possibility of achieving early success through the latter route.

 

Ku believed that a consumer finance licence could limit the business in the longer term and expose it to regulatory challenges.

 

The discussion also touched on how founder-led businesses can expand while retaining their identity. Sengupta said many of the entrepreneurs interviewed had drawn on Western management practices alongside the history and philosophy of their home countries, adapting professional management methods to their own business contexts.

 

However, building a lasting family legacy remains difficult. While many founders think about ensuring their businesses survive beyond their own lifetimes, Sengupta said few had been particularly successful in achieving this.

 

Comparing Asian and international chief executives, he said their underlying mindsets and behaviours were not substantially different, although the environments in which they operate influence their decisions.

 

Sengupta also discussed the challenges women face in leadership, noting that many women CEOs emphasised the importance of freedom, opportunity and support systems that women may not have access to while growing up. He also added that only 3 of the 30 CEOs he spoke to were women, which further shows the reality of women representation.

 

On talent management, he said the way founder-CEOs hire, manage and develop people can be different and sometimes uncomfortable, but remains a decisive factor in the success of a business.