diff --git a/cmd/main.go b/cmd/main.go
index 2376fe3a9..34cc6119d 100644
--- a/cmd/main.go
+++ b/cmd/main.go
@@ -209,8 +209,9 @@ func main() {
 	currentNamespace := utils.CurrentNamespace()
 
 	templateReconciler := controller.TemplateReconciler{
-		Client:          mgr.GetClient(),
-		SystemNamespace: currentNamespace,
+		Client:           mgr.GetClient(),
+		CreateManagement: createManagement,
+		SystemNamespace:  currentNamespace,
 		DefaultRegistryConfig: helm.DefaultRegistryConfig{
 			URL:               defaultRegistryURL,
 			RepoType:          determinedRepositoryType,
diff --git a/internal/controller/release_controller.go b/internal/controller/release_controller.go
index 2caa4add0..8f201b3fd 100644
--- a/internal/controller/release_controller.go
+++ b/internal/controller/release_controller.go
@@ -379,10 +379,7 @@ func (r *ReleaseReconciler) SetupWithManager(mgr ctrl.Manager) error {
 	if err != nil {
 		return err
 	}
-	//
-	if !r.CreateManagement {
-		return nil
-	}
+
 	// There's no Release objects created yet and we need to trigger reconcile
 	initChannel := make(chan event.GenericEvent, 1)
 	initChannel <- event.GenericEvent{Object: &kcm.Release{}}
diff --git a/internal/controller/template_controller.go b/internal/controller/template_controller.go
index 706bdb9c0..c4c11b751 100644
--- a/internal/controller/template_controller.go
+++ b/internal/controller/template_controller.go
@@ -51,6 +51,7 @@ type TemplateReconciler struct {
 
 	SystemNamespace       string
 	DefaultRegistryConfig helm.DefaultRegistryConfig
+	CreateManagement      bool
 }
 
 type ClusterTemplateReconciler struct {
@@ -163,12 +164,11 @@ func (r *ProviderTemplateReconciler) Reconcile(ctx context.Context, req ctrl.Req
 		l.Error(err, "Failed to get ProviderTemplate")
 		return ctrl.Result{}, err
 	}
-
 	management, err := r.getManagement(ctx, providerTemplate)
-	if err != nil {
+	if r.CreateManagement && err != nil {
 		return ctrl.Result{}, err
 	}
-	if !management.DeletionTimestamp.IsZero() {
+	if management != nil && !management.DeletionTimestamp.IsZero() {
 		l.Info("Management is being deleted, skipping ProviderTemplate reconciliation")
 		return ctrl.Result{}, nil
 	}