Corporate governance today is ineffective primarily because of the concentration of corporate power in the hands of management. A revolutionary approach to corporate governance is needed to rebalance or equalize this power, stop management fraud, promote accurate financial reporting, and thus regain the shaken confidence of the financial markets. This approach can be accomplished by recognizing the employees as key participants in the corporate process. Consequently, the present structure of corporate governance, which is essentially a "table for two" between the management and the board, will be replaced by a "table for three", which marks the recognition of the employees as full members of the corporate team.

Corporate governance structures have always been a private matter between shareholders and managers. However, as the US Congress passed the Sarbanes-Oxley Act to curb recent corporate malfeasance, these structures governing the conduct of the corporation are now a matter of law. Even the adoption of a code of ethics, which was previously within the domain of management prerogatives, is now a requirement under the Act.

In our view, corporate governance today is biased, due to the concentration of corporate power in the hands of top management. Apparently, our capitalistic system works well when corporate power is balanced between the shareholders and managers. In order to rebalance or equalize this power, stop management fraud, and promote accurate financial reporting to regain the shaken confidence of the financial markets, a revolutionary approach to corporate governance is needed. We believe that all these can be accomplished by recognizing the employees as a group of key participants in the corporate process, rather than as a factor of production and as a commodity traded in the labor market.

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