Welcome to AFR BOSS

It's strange, this mood of shifting realities we're dealing with. The pain of rising prices and interest rates and the shock at the petrol pump swirls through the media. And after a decade of low inflation, the impact on business inputs, supply chains and consumer behaviour is thudding home even as the resources sector struggles with meeting soaring demand. To this we add the looming impact of the Federal Government's evolving carbon emissions trading scheme, which is a bit like trying to wrestle with smoke. It comes as decision-making horizons are shrinking sharply and the strategists are busy revising scenarios. Scientific research suggests we are often ill-prepared, unable to countenance change, especially after long periods of prosperity. The psychologists even have a name for the phenomenon - deferred salience, a state in which people forget or have no experience of dealing with adversity and are ill equipped emotionally and pragmatically to respond to a challenging, ambiguous environment.

This is the world our young leaders are stepping up to. The six winners of the AFR BOSS Young Executive Awards, who stood out from an impressive field, say they're up for the challenges. Meet them on page 24. Our thanks to the members of the judging panel, Roger Corbett, Bonnie Boezeman and Sally Macdonald, and to DDI's chief executive Bruce Watt, for their time and contribution.

Also this month we profile the Rudd Government's policy wonk du jour, Australian Industry Group chief executive Heather Ridout. In our cover story interview with Colleen Ryan, Ridout hits back at her critics, and offers some insights into how she walks the fine line between influencing and being captured.

In this issue we also look at how energy company AGL is trying to reload after its brush with bull market boss Paul Anthony (page 44). And we get a sense of the challenges in the Pilbara wrought by the resources boom, as Michael Vaughan takes a trip with junior miner Atlas Iron.

Narelle Hooper

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