Craig Dunn told a shareholders meeting in Sydney that well-targeted regulation had an important role to play, but alone wouldn't deliver the higher quality or resilient services that underpin Australia's productivity.
As an example, Mr Dunn cited calls for mandatory roaming, which would require mobile operators to offer service to customers of other networks when they move outside their own provider's footprint.
The Australian Competition and Consumer Commission in August began a 12-month inquiry on the issue with submissions due in November.
The goal is to improve service for Australians living in remote and rural areas, but Mr Dunn said it risked doing the opposite.
"Mandated roaming does not build a single new mobile tower or extend coverage into areas where no network exists today," he told the Tuesday meeting.
Telstra has spent $3.8 billion on its mobile network in regional and remote Australia over the past five years as part of a broader strategy that allows the telecommunications provider to differentiate on coverage.
Mandatory roaming risked slowing further investment, Mr Dunn said.
"New regulation must be judged by the incentives it creates, and not by the intentions behind it," he said.
The annual meeting took place against the lingering backdrop of a nationwide Telstra outage in July, which knocked out services for most of a day.
Chief executive Vicki Brady told shareholders the company knew it let customers down with the network failure.
An external review by Technology Audit Partners found the disruption was primarily the result of Telstra not treating network timing as a critical capability that required the highest levels of oversight.
The outage began in the early hours of the morning after a planned change to a timing chassis in Melbourne triggered rolling network failures due to an incorrect internal date being set.
Ownership for network timing issues wasn't sufficiently defined and there was insufficient technical expertise on hand to deal with the problem when it arose, the report found.
"We accept the findings, we've taken immediate steps to strengthen our network, and that work continues," Ms Brady said.
"Our commitment is to use what we have learned to make our services even more resilient and reliable for our customers."
The outage sparked a Senate inquiry and an ongoing investigation by the Australian Communications and Media Authority.
In response, Telstra's board reduced Ms Brady's pay package by $607,000 for 2025/26, taking her total compensation to $6.8 million.
It also docked the short-term incentive pay of nine other senior executives by a total of $1.3 million.
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