The tech is there, but that doesn't mean you create products people will buy.
At Telstra, the appointment of Vicki Brady as chief executive marks not an ending but a beginning — the first movement in a longer institutional reckoning with time, independence, and the quiet weight of tenure. Chairman John Mullen's decade-plus stewardship, once a source of continuity, has become a governance question that proxy advisors and institutional investors are no longer content to leave unanswered. As Brady inherits the ambitions of the T25 strategy, she does so in the knowledge that the board above her is itself mid-transition — and that the steadiness of any organisation depends not only on who leads, but on whether those who govern them can step aside with grace.
- John Mullen's 10-plus years as chairman has crossed the threshold where governance watchdogs no longer consider him independent, and institutional pressure for his exit is quietly but unmistakably building.
- Proxy advisors including ISS are signalling to clients that Mullen's time has passed, while investors like abrdn expect he will not seek reelection at the 2023 AGM — making his departure a matter of when, not if.
- The succession race for the chairmanship is murkier than the CEO handover, with internal candidates favoured given Telstra's complexity, and names like Jacqueline Searle circulating alongside a roster of seasoned telecoms and finance veterans.
- Brady's T25 mandate is demanding — mid-single-digit earnings growth, a $500 million cost reduction, 95 percent 5G coverage, and a doubled loyalty membership — all while the question of whether consumers will actually pay a premium for 5G remains stubbornly unresolved.
- NBN margin pressures persist, tech giants loom as both partners and rivals, and Brady must navigate forces largely outside her control even as she works to stabilise leadership from within.
Telstra's leadership transition is more layered than a simple changing of the guard. Vicki Brady's elevation to chief executive following Andy Penn's departure is the visible move, but the deeper question concerns chairman John Mullen, whose tenure of more than a decade has drawn increasing scrutiny from governance watchdogs and institutional shareholders.
Mullen has acknowledged the clock is ticking, noting his term expires in October 2023 and that succession discussions are coming. Yet the pressure is already present. Fewer than one in five ASX 200 directors serve longer than a decade, and bodies like the Australian Shareholders' Association cease classifying long-tenured directors as independent after 12 years. Proxy advisors have begun signalling to clients that Mullen's time is up, and investors such as abrdn expect he will not seek reelection at the 2023 annual general meeting — with a handover of the chairmanship likely before then.
Who replaces him is less clear than the Penn-to-Brady succession. Internal candidates are preferred given the business's complexity, and the board's own history — Mullen spent eight years as a director before becoming chairman — suggests someone like Jacqueline Searle may be in contention. A staggered transition, allowing Brady to settle before a new chairman arrives, is widely seen as preferable to simultaneous turnover at both roles.
Brady's immediate task is executing T25, Telstra's growth strategy through 2025, which demands earnings expansion, a $500 million cost reduction, near-universal 5G coverage, and a doubled loyalty membership. She has framed 5G as central to Telstra's future and suggested tech giants could be partners rather than rivals. But industry observers remain cautious — overseas markets have yet to demonstrate that consumers will pay meaningfully more for 5G over 4G, and the products that might justify that premium have not yet materialised.
On the NBN front, the worst of the rollout headwinds are easing, but margin pressure on mid-market plans persists without further regulatory intervention. For Brady, and for whoever ultimately takes the chairman's seat, the road ahead requires both internal cohesion and a steady hand navigating forces that no leadership transition, however well choreographed, can fully control.
Telstra is in the midst of a carefully choreographed leadership transition, with the appointment of Vicki Brady as chief executive marking only the first move in a broader reshuffling at the top. Andy Penn's departure opens the door for Brady to take the helm, but the real question hanging over the company concerns the future of chairman John Mullen, whose decade-plus tenure has begun to draw scrutiny from governance watchdogs and institutional investors alike.
Mullen himself acknowledged the inevitable in recent remarks, noting that his term expires in October 2023 and that he will be discussing his future and possible succession around that time. He expressed confidence in the board's ability to find a strong replacement when the moment arrives, and said he looked forward to working with Brady and her team as they roll out the T25 strategy. Yet the subtext is clear: his time is running short. Fewer than one in five directors on the ASX 200 serve longer than a decade, making Mullen's tenure genuinely unusual. The Australian Shareholders' Association stopped classifying long-serving directors as independent after 12 years of service, citing concerns that extended board tenure can lead to entrenchment, excessive alignment with management, and a reluctance to challenge decisions. APRA's John Lonsdale recently highlighted these same worries in the financial services sector.
Telstra's own governance framework acknowledges the tension. The company conducts a formal review after three three-year terms to examine board renewal and composition. Both Mullen and fellow director Nora Scheinkestel have served more than nine years, yet the board has determined they retain their independence of character and judgment despite their length of service. That determination, however, may not hold sway with proxy advisors. Institutional Shareholder Services and other firms have begun signaling to clients that Mullen's time is up. Natalie Tam, deputy head of Australian equities at abrdn, said that from a best-practice governance perspective, directors should probably not exceed 10 to 12 years of service, and that once they do, they are generally no longer considered independent. Based on her conversations with Telstra, Tam expects Mullen will not seek reelection at the 2023 annual general meeting, with a handover of the chairmanship likely before then.
The succession plan after Mullen remains murkier than the Penn-to-Brady transition. Internal candidates are favored given the complexity of the business—Mullen himself spent eight years on the board before replacing Catherine Livingstone, who had served nine years before becoming chairman. That pattern suggests Jacqueline Searle may be in contention, though the board also includes Verizon alumni Roy Chestnutt, former AMP chief Craig Dunn, Expert360 founder Bridget Loudon, ex-Afterpay chairman Elana Rubin, and offshore telecoms veterans Eelco Blok and Niek Jan van Damme. A staggered succession—with Mullen departing after Brady has settled in—is preferable to simultaneous turnover at both the top roles, which could prove disruptive.
Brady herself faces formidable obstacles in executing the immediate priorities of T25, the extension of Telstra's earlier T22 cost-cutting program. The strategy demands that Telstra lift earnings in the mid-single digits through 2025, grow its dividend again, cut $500 million in costs over three years, expand 5G coverage to 95 percent of Australians, and double membership of its loyalty program. Brady has signaled that 5G is central to growth, pointing to signs that the local mobile market is turning a corner. Yet industry consultant Paul Budde is skeptical that the technology alone will drive meaningful expansion. The fundamental problem, he argues, is whether consumers will actually pay more for 5G over 4G. Greater Internet of Things applications and faster speeds have failed to persuade overseas markets that the jump is worth making. The tech exists, but that does not guarantee the right products will emerge that people want to buy.
Brady has suggested that tech giants like Google, Amazon, and Facebook could be partners rather than competitors, a more optimistic framing than some analysts hold. On the National Broadband Network front, while the headwinds from the rollout are beginning to ease, she will be hoping the competition regulator overhauls NBN's pricing model when it completes its review this year. NBN Co has agreed to remove controversial capacity charges for only the highest speed tiers, but without further intervention, profit margins on mid-market and entry-level plans will continue to face pressure. For Brady and whoever ultimately replaces Mullen in the chairman's seat, the path forward demands both internal alignment and external navigation of forces largely beyond their control.
Notable Quotes
I enjoy my work as chairman of the board and look forward to working with Vicki and her team as we roll out the T25 strategy.— John Mullen, Telstra chairman
The trouble is are you or I going to pay more money because we now have 5G instead of 4G? That is the problem.— Paul Budde, industry consultant
The Hearth Conversation Another angle on the story
Why does it matter so much that Mullen is leaving? He's been there a long time, but is that really a problem?
It's not that long tenure itself is bad—it's that after about a decade, governance experts worry a director becomes too comfortable with management, too invested in past decisions, too reluctant to push back. Mullen has been there over ten years. The rules have shifted around him.
So the board is forcing him out?
Not exactly forcing. He's acknowledged his term ends next October and that succession will be discussed. But proxy advisors have already told investors his time is up. It's a gentle but firm signal.
And Brady—the new CEO—she's walking into a mess, isn't she?
Not a mess, but a genuine puzzle. She needs to make 5G profitable, which means convincing people to pay more for it. That hasn't worked overseas. Meanwhile, the NBN is squeezing margins on regular broadband, and Google and Amazon are creeping into telecom territory.
Can she do it?
She's optimistic about partnerships with the tech giants and about 5G as a growth engine. But even her own industry consultant thinks growth will be very difficult to deliver. She's got the strategy, but the market hasn't proven the demand yet.
So what's the real story here—is it about the leadership change or the business challenge?
Both, but they're connected. A new CEO and a new chairman arriving at the same time could be destabilizing. That's why they're staggering it. But the deeper story is whether Telstra can stop shrinking and start growing again. Everything else is just the people trying to make that happen.