Telstra chief executive, David Thodey, has stepped down after almost six years at the helm.
Former AXA chief executive and current Telstra chief financial officer, Andrew Penn, 51, will replace Thodey, who has announced his retirement.
Telstra chairperson, Catherine Livingstone, said Penn was a seasoned executive in global market with proven capability to lead organisations through significant transitions and major expansion.
"He has played a key role in developing Telstra's long-term growth strategy and we are delighted he will continue to lead Telstra's plans to increase customers advocacy, core business value and capitalise on new growth opportunities.
"It is testament to David Thodey that we were able to select the next chief executive from within the business."
Thodey, 60, will continue to assist with Penn's transition from May 1, until the end of the financial year and remain available to the business until late August.
Thodey said his time as chief executive had been focused on developing a strong leadership team.
He said Telstra's evolution as a customer-focused organisation and the completion of the NBN agreement with the federal government has been of historical importance for the company and the country.
"Our journey to being a world class customer service organisation is generational progress," he said.
"We have achieved much change but there is a lot more to do.
"We have provided customer with outstanding connectivity choices, a world class mobile network and new technology to make their lives easier. Andy is ideally placed to keep Telstra on that journey and I'm delighted he has been appointed."
On retirement, Thodey will receive benefits in accordance with his contract of employment and terms of relevant incentive plans, according to a company statement.
The board will permit him to retain a pro-rated amount of his FY15 long term incentive subject to performance conditions and restriction periods in the FY15 LTI plan.
Penn will be paid $2.325 million a year, with short term and long term incentives.
He has a short term incentive which allows him to earn 100 per cent of his yearly salary if performance targets are achieved and up to 200 per cent if they are exceeded.
Penn said he was looking forward to building on Thodey's transition of Telstra into a customer-focused organisation with significant opportunities in new businesses, domestic operations and overseas investment and partnerships.
"Telstra plays a critical role to provide leading technology solutions and service to our customers in the consumer, business and broader social environment," he said.
"The Telstra Board and leadership team has developed compelling plans to 2020, and beyond, which will expand our capability as a increasingly global connectivity company and position us for future growth."