Earlier quoted context omitted.
It's fine as a serialization/deserialization primitive for on-disk files, as long as the NULL character is invalid. String tables in most object file formats work like that, a concatenated series of ASCIIZ strings. One byte of overhead (NUL), requires only an offset into one to address a string and you can share strings with common suffixes. It's a very compact layout.
Nothing prevents you from using a shared pool of strings that don't have null terminator. It can even be more efficient, since you don't have the null byte to handle at string end. Depending on the maximum string length you want to support, it doesn't even have to take more space.
If we concatenate the raw strings together without the null terminator, either all string references will require a length on top of the offset (25% size penalty for a Elf32_Sym), or we'll need a separate descriptor table that stores string offsets and lengths to index into.
If we prepend strings with a length (let's say LEB128), we'll be at best tied with null-terminated strings because we'd have a byte for the length vs. a byte for the terminator. At worst, we'll have a longer string table because we'd need more than one byte to encode a long string length and we would lose the ability to share string suffixes.
Out of all the jank from a.out and COFF that was eliminated with ELF, that representation for the string table was kept (in fact, the only change was mandating a null byte at the beginning to have the offset 0 indicate a null string). It works fine since the 1970s and doesn't cause undue problems, as nothing prevents a parser to spit out std::string_view instead of const char* for the application code.