SINGAPORE (Sept 30): When a controversial CEO steps down from his post, it is usually just the beginning of an ugly clean-up. Never has that been more true than for WeWork.

Adam Neumann, the controversial co-founder and CEO of the troubled office subleasing start-up, is stepping down, media outlets reported on Sept 24. Two WeWork insiders, the chief financial officer and vice-chairman of the board, will become co-CEOs.

The questions are, does that fix what is wrong with WeWork, restore investor confidence and resolve the company’s ugly governance? Partially, maybe no and probably not.

It has been clear for some time that Neumann is both the biggest reason for WeWork’s growth and its largest liability. His charisma and outlandish dreams to make office leasing the beginning of a self-actualised empire drew in legions of deep-pocketed believers who poured more than US$12 billion ($16.6 billion) into his company.

He also used his position to enrich himself, to the tune of many hundreds of millions of dollars in WeWork stock sales, personal loans tied to his shares, agreements for WeWork to lease buildings he owned, and nice gigs for his family members with the company.

Along the way, Neumann built a company that bled cash, spent recklessly, became wildly overvalued and maybe is not viable in its current form. WeWork’s investors — notably the Japanese telecom giant SoftBank — enabled Neumann throughout. SoftBank apparently only turned against him in recent days when it was clear that WeWork would have trouble going public at anywhere close to the US$47 billion paper valuation that SoftBank put on the company. Billionaires such as SoftBank’s Masayoshi Son are apparently on your side until you threaten to cost them billions of dollars.

I am not confident, however, that Neumann’s stepping down fundamentally clears the path to an IPO. Neumann has until now controlled WeWork through a special class of shares. Bloomberg News reported that his control would be diluted, but the new CEOs — or their successor, if they are caretakers in that job — would have to contend with an incredibly opinionated shareholder second-guessing their every move. Investors should also question whether WeWork has the right board of directors and whether WeWork insiders are the proper stewards, even temporarily. Everyone involved in this company deserves blame for WeWork’s situation.

There is also that continuing problem of WeWork’s need for cash — a lot of it, and rather urgently. The company has been on pace to burn through roughly US$3 billion this year, and that is why an IPO was needed to pull in billions of dollars in stock sales and loans tied in part to an IPO. The company’s bankers and some executives have talked recently about slashing up to one-third of WeWork’s staff, slowing the company’s office lease expansion and shutting ancillary businesses, according to technology news outlet The Information.

That is a doozy of an idea, and it shows how dire the situation is. No matter what WeWork does, however, there is the not-inconsequential matter of nearly US$50 billion in lease commitments WeWork owes in coming years, regardless of whether WeWork stops its global office expansion immediately. And WeWork has not disclosed enough financial information for investors to know whether the buildings WeWork has occupied the longest generate more revenue from tenant payments than WeWork has spent on leasing, renovation and other costs.

It is stunning that the company has come to this. Changing CEOs on what should be the doorstep of an IPO may not be unprecedented, but it is certainly wild. And no one comes off looking good — certainly not Neumann, whose self-dealing, outlandish statements and reckless stewardship have made him the poster child for start-up cluelessness; not SoftBank; not WeWork’s greedy bankers; nor the rest of the long line of WeWork cheerleaders and enablers.

Changing the CEO, in short, does not necessarily change WeWork’s condition. And it certainly would delay an IPO even longer and raise fresh questions about whether WeWork can tap alternate sources of funding or pare expenses to preserve cash. This company needs to be overhauled from top to bottom, period.

That does not happen quickly, and it does not happen without a top-notch management team and board. WeWork’s executives and directors have not proved up to the task. — Bloomberg LP