Mr Boyd told attending shareholders the board was "very satisfied" with the performance of the management team.
"Performance deserves to be rewarded. I am aware that there has been disquiet among some of you regarding remuneration of our executives, in particular our CEO, Paul Reynolds."
More than at any time in its history, Telecom needed world-class management, he said.
The company's strategy of total transformation for the long-term health of the company was essential, but that carried few guarantees of success.
An excellent start had been made, in line with the five-year strategy, and Telecom had delivered everything it said it would, Mr Boyd said.
"As such, it is appropriate that the executive team is rewarded for leading what is already New Zealand's most complex business through a complete rebuild."
Telecom disclosed more detail about executive remuneration than it was required to under New Zealand laws, he said.
When Dr Reynolds was appointed more than two years ago, his contract was fully disclosed and it remained available for shareholders to view.
Dr Reynolds' incentive schemes were also disclosed in detail in the 2007 notice of meeting before that year's annual meeting in Dunedin.
The discussion at that annual meeting covered many of the issues raised in recent weeks, and shareholders had voted in favour of Dr Reynolds' short- and long-term incentive schemes, Mr Boyd said.
In its annual report, published in August, Telecom reported that Dr Reynolds was paid more than $5 million for the year to June 30, including his full performance bonus, despite a 43.9% drop in company profits.
The company's other top six executives pulled in another $11 million among them.
Mr Boyd linked the fortunes of Telecom to those of the country as a whole.
"Telecom must be strong for New Zealand to thrive. Telecom remains a cornerstone of of the NZX and one of the few large corporations to maintain its head office in New Zealand."
Telecom employed more than 7000 New Zealanders and many thousands more through its partners.
Telecom's investment of $3 million a day was good for the company's long-term health but it was also good for all of New Zealand, he said.
However, time was against the company.
The delivery of the five-year strategy was critical for Telecom, and the stakes were higher than ever.
Much work remained to be done but there was a real chance of success.
"This is why, more than ever, we need world-class leadership across Telecom."
