“Brain Capital” in the AI Era and the Role of Law / Reflections on Reading the WEF Report “The Human Advantage”

0 Introduction

In my reflections on AI and law, I have previously touched upon AI and the brain. This is a follow-up to those discussions.

In January 2026, the World Economic Forum (WEF), in collaboration with the McKinsey Health Institute, published a report titled “The Human Advantage: Stronger Brains in the Age of AI.”

Until now, discussions on “AI and law” or AI governance have been dominated by a technology-centric perspective—that is, “how to control AI”—such as regulating AI technology itself, identifying responsible parties, or preventing rights infringements. However, now that the social implementation of generative AI has become irreversible and has begun to deeply permeate our lives and work flows, what must be questioned is the “foundation of the human side that confronts and collaborates with AI.”

The concept of “Brain Capital” proposed in this report argues that human cognitive abilities and mental health are the sources of economic growth and social resilience in the AI era, and the core of competitive advantage. This provides a new perspective for discussions on labor law, healthcare-related law, and even “Cognitive Liberty” and privacy rights as fundamental human rights.

In this article, I will provide an overview of the two pillars presented in this report— “Brain Health” and “Brain Skills”—as well as the levers for social implementation that support them, and then examine the legal issues derived from them and the form of governance that companies and nations should adopt.

1 The Location of the Problem: The Divergence Between Technological Progress and the Human Foundation

At the beginning, the report points out the paradigm shift facing modern society. If the Industrial Revolution was a transition from physical labor to machines, the AI revolution forces a redefinition of the importance of the brain that supports the expansion of human cognitive abilities. As AI transforms labor and life, competitiveness will depend on the “combination of human and machine strengths.”

However, the current situation deviates from that ideal. 24% of the global burden of disease is attributed to brain-related health conditions such as mental health disorders, neurological diseases, and substance use disorders (2025 estimate). The increase in dementia due to aging, chronic stress in the workplace, and uncertainty about the future are lowering the performance of the human brain.

From a legal perspective, it is noteworthy that the report quantifies the economic losses caused by underinvestment in brain health. It is estimated that with appropriate interventions, 267 million disability-adjusted life years (DALYs) could be avoided by 2050, potentially generating up to $6.2 trillion in economic benefits. Conversely, neglecting investment in the brain could become a significant management risk or policy failure that could offset the productivity improvement effects of AI adoption.

In the context of corporate legal affairs and management decisions, this means that employee mental health measures go beyond mere welfare or compliance, becoming a core indicator of human capital management. It is necessary to face the dual nature of the impact of AI adoption on the work environment: the “benefit” of productivity improvement and the “risk” of cognitive overload. While traditional occupational health and safety laws have focused on protection from physical hazards, legal responses to cognitive/mental hazards will be required from now on.

2 Overcoming Fragmentation and Defining “Brain Capital”

The highlight of this report is that it redefines health and ability, which have been treated as separate domains, as an integrated concept called “Brain Capital.” Brain Capital is defined as the combination of the following two elements.

The first is “Brain Health.” This does not simply refer to the absence of disease, but to the “state of optimal brain function” throughout the entire life course from development to aging. It is a concept that comprehensively captures the state of the brain, from neurodevelopment in childhood to mental health in adulthood and dementia prevention in old age. Factors such as sleep, nutrition, exercise, and social connections are deeply involved, and these are holistic health foundations that also correlate with the risk of cardiovascular disease and cancer.

The second is “Brain Skills.” This refers to the abilities that allow people to adapt, build relationships, and contribute, including cognitive abilities, interpersonal skills, self-leadership, and technical literacy. Citing the WEF’s “Future of Jobs Report 2025,” the report lists analytical thinking, creative thinking, resilience (flexibility and agility), empathy, and leadership as skills that will be important in the future. These are “human-specific abilities” that are difficult for AI to replace and are essential for utilizing AI.

What is important is that these two are interdependent. Under burnout or chronic stress, “brain skills” such as creativity and complex decision-making ability are significantly reduced. In other words, even if a company asks its employees for advanced reskilling, if the “brain health” that serves as the foundation is impaired, return on investment cannot be expected.

In terms of legal policy, “public health (medicine)” and “education/vocational training (labor)” have been separated, but the concept of Brain Capital overcomes this vertical division and encourages an integrated approach.

3 Five Key Points for Building Brain Capital

The report presents the following five levers (action guidelines) as a roadmap for building Brain Capital. These can serve as concrete guidelines for policymakers and corporate executives to address.

(1) Safeguard brain health

This involves ensuring access to prevention, treatment, and care throughout the life course. The burden of brain disorders spans all generations, from the young to the elderly, and the fact that half of all mental health disorders emerge by age 14 is particularly significant. Furthermore, measures against dementia, such as Alzheimer's disease, are an urgent issue. Legally, in addition to guaranteeing the right to medical access, the question is how to make the 'right to mental health' in the workplace a reality.

(2) Foster brain skills

This refers to fostering skills for the next generation, current workers, and the elderly. According to the report, an average of 59% of employees will need reskilling by 2030. In the AI era, 'cognitive flexibility' and 'critical thinking'—the ability to rethink approaches in response to changing situations—are valued more than the ability to follow predetermined recipes (procedures). Data showing that investment in early childhood education yields high returns (7-13% annually) can serve as legislative evidence to reinforce the legitimacy of allocating public resources to early intervention in guaranteeing the right to education.

(3) Study brain capital

This involves establishing brain capital as an interdisciplinary research field and developing metrics. In addition to traditional economic indicators like GDP, the necessity of 'satellite accounts' to visualize brain capital is suggested. Accounting for and visualizing the state of the brain as an 'asset' will form the basis for evidence-based policymaking.

(4) Invest in brain capital

This involves utilizing innovative financial schemes such as blended finance (a mix of public/philanthropic and private funds) and social impact bonds, in addition to traditional public funding and grants. Since investments in the brain have a long lead time before returns, creating mechanisms to attract risk capital is essential.

(5) Mobilize for brain capital

This involves governments, businesses, academia, and civil society working together to launch a global movement that positions brain capital as a priority in economic and social policy. The report argues that commitment at the CEO and board level is crucial.

4 Considerations from a Legal and Governance Perspective

Based on the contents of the report above, I would like to present several points of discussion from the perspectives of AI, law, and corporate governance.

4.1 'Cognitive' Deepening of the Duty of Safety in Labor Law

Traditionally, an employer's duty of safety in labor law has focused primarily on preventing physical hazards and health impairments caused by long working hours. However, if the concept of brain capital is incorporated, companies may be required to have an active duty to 'maintain and promote' the brain health of their employees.

Specifically, consideration for technostress and cognitive overload associated with the introduction of AI will become a new issue for occupational health and safety. If AI-driven operational efficiency is designed in a way that increases human surveillance density and strips away psychological safety or autonomy, it is a destruction of brain capital and will hinder productivity in the long term. The legislation of the 'Right to Disconnect' discussed in Europe and elsewhere, and the mandatory implementation of mental health measures in the workplace, should be further strengthened in this context of 'protecting brain capital'.

It also provides implications for identifying 'causality' in legal liability. When an employee commits a serious error, it has traditionally tended to be attributed to individual 'negligence (lack of skills).' However, from the perspective of brain capital, if there is 'inadequate organizational brain health management (neglect of cognitive overload)' in the background, the possibility of holding the organization responsible as a systemic defect increases.

4.2 Neuro-rights and Privacy

As the 'study' and 'measurement' of brain capital progress, 'neuro-rights' are emerging as a new legal challenge.

While measuring and visualizing the state of the brain contributes to the improvement of brain capital, it also implies the use of ultimate private information. There is a risk that employees' brain waves and cognitive states could be monitored through wearable devices or BMI (Brain-Machine Interfaces), and that this data could be used for personnel evaluation and screening as a 'brain capital score'.

How do we design a balance between the legitimate purpose of promoting brain health and mental integrity or cognitive liberty? Establishing governance principles specific to brain data, beyond the framework of personal information protection laws, is an urgent task. Legal safeguards are necessary to ensure that measurement does not lead to 'management' or 'neuro-discrimination'.

4.3 Human Capital Management and Corporate Governance

In Japan, too, 'human capital management' is being called for, and the disclosure of human resource information in securities reports has become mandatory. The concept of 'Brain Capital' in this report concretizes the substance of human capital and provides it with scientific backing.

Demonstrating to investors how a company protects the brain health of its employees and fosters brain skills adapted to the AI era serves as important non-financial information for measuring corporate sustainability. Boards of directors will likely bear a duty of care to monitor the erosion of brain capital and oversee its accumulation, just as they do for financial capital.

The organizational transformation framework presented in the report, '5As' (Aspire, Assess, Architect, Act, Advance), serves as a useful guideline for companies when implementing brain capital strategies.

4.4 'Brain Skills' Required by Law

Finally, there are implications for the field of law. With generative AI, routine tasks such as contract drafting and case law research are being rapidly replaced. For legal studies, this means a decline in the value of the 'ability to follow known recipes.'

On the other hand, the 'brain skills' emphasized in the report—complex decision-making, ethical judgment, deep empathy for clients, and creative legal interpretation in unknown situations (inventing new recipes)—are the very qualities required of legal professionals in the AI era. Legal education and practical training should also focus on cultivating these higher-order brain skills rather than just cramming knowledge.

5 Conclusion

This report by the WEF and the McKinsey Health Institute urges us to turn our gaze back to the 'human brain'—the creator and partner of AI—in an age where we are prone to being captivated by the external intelligence of AI.

AI is merely a tool. It is still humans with 'strong, healthy brains' who master that tool, create new value, and solve the complex problems of society. Investing in brain capital is not just a matter of employee benefits or reducing medical costs. It is the most certain investment strategy that will determine national competitiveness, corporate survival, and individual well-being in the AI era.

Even in the field of law, by incorporating this perspective of 'Brain Capital,' we should be able to update discussions on labor, education, privacy, and human rights to be more scientific and effective. We are facing a time when legal and policy resources should be poured into 'human updates' and the development of environments for walking alongside AI, rather than fearing its evolution.

(Magazine) 'AI and Law - Reflections'

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