International evidence shows that research is increasingly being carried out in organisational forms built around cross-sectoral (government, academic and business) and transdisciplinary teams with well-defined national social, economic or environmental objectives in view. As a result, new and unfamiliar forms of organisational arrangements for research are emerging within universities and elsewhere. These collaborative research centres have been variously termed ‘hybrid’ or ‘parasitic’. This paper draws upon around 30 in-depth interviews with participants from selected Australian Cooperative Research Centres (CRC). It examines how researchers reconcile the many demands of their dual role, first, as a government researcher or academic, and second as a committed participant in an industry-collaborative research centre. These collaborations go beyond ‘applied research’ to span fundamental research and immediately useful knowledge. But reward systems and performance measures for academic researchers are still founded largely on ‘discovery’, while those for government researchers are based upon ‘application’. The risk is that researchers will be deflected by the collaboration in ways that conflict with their institutional responsibilities. The paper reports work analysing the management strategies used by the CRCs and their public sector partners to ensure that their common goals are achieved while preserving their institutional interests and the expectations of their research staff. The aim is to identify effective ways of managing the various ‘risks’ of cross-sector collaborative research and development (R&D) in Australia and more widely.