Bruce Frohman, California, USA

A It depends what you mean by business. If your definition includes hedge funds, private equity and investment banking, then the answer is a flat yes. If by business, you're referring to the industrial and consumer companies at the core of our economy, the answer is:

"Less and less so". And therein lies a problem.

OK, so maybe it's not a big problem yet. But there is definitely a worrisome trend emerging, in that a burgeoning number of talented senior executives are leaving publicly-traded businesses for privatelyheld concerns. Dave Calhoun's departure from General Electric to run Nielsen and Mark Frissora's leap from Tenneco to Hertz are just two of the more publicised cases. But as a seasoned executive search consultant we know recently put it, "The shift is real and it's gaining momentum. You can almost feel a landslide coming."

And not only in the upper echelons - it's happening in middle management and at business schools as well.

True, investment banking has long drawn between 10% and 20% of the graduates at most highlyregarded MBA programs.

But today, an increasing number of MBAs, particularly those in the top tier of their classes, are also answering the siren song of private equity and hedge funds. In 2006, for instance, almost 25% of the graduating class of Harvard Business School took jobs in those two industries. At Dartmouth's Tuck School, 10% did, but only because the supply of private equity and hedge fund jobs wasn't higher.

One reason, of course, is money. Compensation for senior managers in public companies doesn't compare to the heaps routinely handed out by private equity and financial firms.

And it would be very hard to name an industrial or consumer company where an MBA could start by earning $289,000 in base and bonus, the average HBS graduate's take-home pay in private equity last year.

But we'd make the case that this trend is not totally about pay. There's a more sociological phenomenon at work - about people who love business wanting to get out of the crosshairs of people who despise it, or at least, seriously distrust it.

Everyone knows that American companies are being maligned these days as never before. So-called shareholder activists have put the vast majority of corporate boards on the defensive, draining their attention away from growth initiatives, mergers and acquisitions, globalisation or anything even vaguely risky that involves building the future. Meanwhile, CEOs face persistent scrutiny from a kind of guilty-until-proven-innocent media.

And so, when private equity firms or hedge funds call, what business enthusiast, young or old, wouldn't answer? Who wouldn't want to do business with the kind of "cover" those industries offer? The same goes for investment banking. Yes, most of the big I-banks are now public. But for some reason - perhaps because the industry has so long been known for gargantuan bonuses - its compensation levels do not garner routine shock and awe.

Now make no mistake.

We're not endorsing this nascent trend. We're only saying we get it - and we fear it. Because to your question, "regular" American business needs the best and brightest to thrive in the global marketplace. We can't have all the big brains flocking to the corners of the economy.

We need them front and centre.

Moreover, we need them there in 30 years. Hedge funds, private equity and Ibanking are not like consulting, where talented managers and MBAs often spend three or five years before returning to industry, wiser and richer.

No, once people enter the Brave New World we're talking about, few will leave.

The money will be too good, and the ability to do business without widespread scorn too gratifying.

The solution? It can only lie with boards, which must pull themselves out of bunker mode to address this problem before it's too far gone. Even in the current environment, they have to work up the courage to create compensation packages that link outsize pay to outsize performance.

And they must make sure those packages reach deep down into the organisation, well below the top five executives who generate all the media and shareholder activist hue and cry.

Moreover, boards must remember that for the best and brightest, the biggest career turn-on is not just money, it's impact.

Companies need to offer exciting, challenging jobs with real decision-making authority to both senior executives and MBAs alike.

Of course, those two measures won't halt the flow of great people away from industry, but they could slow it to a trickle.

And since great people are the whole game, that's a dam worth building.

Jack and Suzy Welch are the authors of the international best-seller Winning. You can email them questions at Winning(at)nytimes. com