What does the emergence of the knowledge worker and of knowledge-worker productivity mean for the governance of the corporation? What do they mean for the future and structure of the economic system?

In the last ten or fifteen years pension funds and other institutional investors became the main share owners of the equity capital of publicly owned companies in all developed countries. This has triggered in the United States a furious debate on the governance of corporations. For with the emergence of pension funds and mutual funds as the owners of publicly owned companies, power has shifted to these new owners.

Similar shifts in both the definition of the purpose of economic organizations such as the business corporation, and of their governance, can be expected to occur in all developed countries.

But within a fairly short period of time, we will face the problem of the governance of corporations again. We will have to redefine the purpose of the employing organization and of its management as both, satisfying the legal owners, such as shareholders, and satisfying the owners of the human capital that gives the organization its wealth-producing power, that is, satisfying the knowledge workers. For increasingly the ability of organizations – and not only of businesses – to survive will come to depend on their "comparative advantage" in making the knowledge worker productive. And the ability to attract and hold the best of the knowledge workers is the first and most fundamental precondition.

Can this be measured, however? Or is it purely an "intangible"? This will surely be a central problem – for management, for investors, for capital markets. What does "Capitalism" mean when knowledge governs – rather than Money? And what do "Free Markets" mean when knowledge workers – and no one else can "own" knowledge – are the true assets. Knowledge workers can be neither bought nor sold. They do not come with a merger or an acquisition. In fact, though the greatest "value," they have no "market value" – that means, of course, that they are not an "asset" in any sense of the term.