New Zealander of the Year and former Xero boss Sir Rod Drury faced misconduct complaint investigation

Wednesday, 15 April 2026

Sir Rod Drury’s attention toward younger female staff was considered by some to be an “in-joke” at tech company Xero. For junior employee Ally Naylor, it wasn't remotely funny. After watching the firm’s founder receive a knighthood and the New Zealander of the Year award, Naylor decided to speak out about alleged inappropriate behaviour that triggered an internal investigation, the results of which have not been disclosed. Drury says he doesn't accept he's done anything wrong, but has apologised for any 'distress' felt. Xero has launched a review, led by a King’s Counsel. Paula Penfold reports.

Acclaimed tech founder and New Zealander of the Year Sir Rod Drury was the subject of a complaint alleging misconduct, which led to an investigation when he was CEO of a major tech company, a Stuff investigation can reveal.

Ally Naylor, who was a junior Xero employee in the mid-2010s, claims Drury invited her to his apartment on multiple occasions in the context of work-related meetings, where she alleges he behaved inappropriately towards her.

She has described resulting distress and ongoing impacts from what she alleges happened.

“It’s hard to put into words how this has impacted me emotionally,” she wrote in a complaint to Xero in 2017.

“There’s a range of emotions from shame, confusion, fear, to anger and hopelessness. Hopelessness because of the power imbalance between the CEO and me.”

When approached by Stuff on Monday, Drury didn’t accept he’d done anything wrong, but offered an apology over any distress Naylor felt.

“If I’ve caused people distress, I would apologise for it. I’ve always tried to look after staff. We’ve always had a really good culture and environment.”

He said he had never had any feedback about the concerns and was not aware of any distress.

“I wasn’t aware of that. I would apologise … profusely,” he said. “That certainly wasn’t my intention and not my understanding.”

Contact the reporter: paula.penfold@stuffdigital.co.nz

In response to a detailed list of questions about Naylor’s claims, and concerns raised by others, a spokesperson for Xero said on Tuesday the company was committed to “fully understanding and evaluating the events and Xero’s response with expert assistance”.

“We have retained external counsel Maria Dew, KC to assist us in undertaking a review of these matters.”

Drury founded accounting software firm Xero in 2005 and was its chief executive for 11 years.

He was knighted in the 2026 New Year Honours for his services to business, the technology industry and philanthropy. In March he took the top prize at the New Zealander of the Year awards.

The recognition prompted Naylor to tell Stuff of what she claimed she experienced from Drury when she was employed at the company for three years between 2014 and 2017. She was 29 when she began work in the IT department as a project coordinator.

Her account is also set out in a formal complaint she made through Xero’s internal whistleblower processes in 2017, which triggered an internal investigation, confirmed in correspondence from the company’s then-general counsel.

Stuff asked Xero for the outcome of the investigation but it was not provided. In its statement, Xero said, “We treat all allegations seriously. Given the matters raised relate to historical events and confidential matters, we are limited in what we can say.”

Other former staff have told Stuff they were aware of concerns about Drury’s conduct during his time as CEO.

A co-worker, a senior manager we’ll call Nick, said it was an “in joke” that Drury had favourites.

“In particular, a demographic that were generally younger females that he would often make a point of chatting to in the office. And Ally was one of those people.”

Naylor said Drury behaved inappropriately towards her on several occasions at his apartment, which was across the road from the Xero building.

She said the first episode happened as she was leaving after accepting an invitation to dinner.

“As he was walking me to the door he kind of like stopped the door and was like, ‘I just really want to kiss you’, and I was like um sorry no.. this is just like a lot for my head.”

She said he accepted that.

“And then I left and I got into the elevator and I was just like, what the f…? What the f… just happened?

“That’s how it started.”

In a phone call with Stuff, Drury said he did not want to talk about Naylor.

“Anything is private between people,” he said “And I think she was a great employee and a really good person.”

Asked why he invited women employees on their own to his apartment for business meetings, Drury said, “That’s private business. I had lots of different friendships.”

He also disputed they were business meetings. “It’s a hard thing to answer. I always had lots and lots of friends.”

He said he understood the power imbalance in a CEO-employee relationship.

“I understand all of that,” he said. “But, you know, it’s a pretty fast-paced environment, and lots of amazing relationships with people at Xero, male and female. It was like we were all unified as a team, doing some amazing things. It was an incredible time.”

Naylor said she first raised concerns about Drury in 2016 in a conversation with her boss, who she says suggested she speak to the head of HR.

She said in that conversation she was asked if she wanted to make a formal complaint.

At that stage she did not, fearing repercussions for her career. She was a solo mother of a young child.

“I’ve got everything to lose,” she recalled thinking.

The following year, when she decided to leave Xero, Naylor raised her complaint through the whistleblower process on her final day at the company, writing that the behaviour had occurred on multiple occasions in 2015 and 2016.

She asked for two outcomes: that the conduct stop, and accountability for the fact that there was no follow-up after she had first alerted the company to concerns.

Emails from the company’s then-general counsel in late December 2017 confirmed an investigation was initiated.

Drury would not speak about his recollections of that investigation.

“I’m not going to talk about that. It’s private.”

Asked if he acknowledged there was an investigation, he said, “I’m not acknowledging anything.”

A further email exchange shows that on March 1, 2018, Naylor asked Xero for the report of the investigation.

She did not receive any written material, and recalls a later conversation in which she was told it could not be provided to her because it contained information that was not about her.

Four days later, on March 5, the company released statements to the markets and media announcing that Drury would step down as CEO after more than 11 years in the role.

At the time, Xero said the decision followed succession planning, and Australian Steve Vamos would take over as CEO. The move was described by analysts and media as sudden and unexpected.

In the phone call with Stuff, Drury said he did not resign because of the complaint and investigation.

“That was a separate issue. I stepped down because it was time to go. The business had moved from building great product, and we were well through a transition with Steve Vamos.”

Asked why he had signalled four months earlier, in November 2017 – when he sold a significant stake in Xero – that he intended to remain as CEO, Drury said, “You’re in until you’re not. I’d been planning to go, I was well into my 50s, and spent a lot of time away from my children and that sort of stuff, and it was time to go. The nature of the business had changed.

“I was delighted to be able to step out after so much hard work.”

After his resignation as CEO, Drury remained with the company as a non-executive director. He departed that role in 2023 and retains a shareholding.

Asked if he would relinquish his New Zealander of the Year award in light of the revelations, Drury said, “If I thought there was anything really bad that I’d done, I certainly wouldn’t have accepted the award. But I think the balance of what I’ve been doing with work and how I’ve treated people and champion people really speaks for itself.”

However, he acknowledged concerns in light of the public recognition.

“I can’t change anything. If I’ve caused people distress, I would apologise for it.”

The New Zealander of the Year awards office said in a statement that prior to Drury’s nomination it was unaware of any potential issues.

It said awardees were decided through an independent judging process, which included multiple rounds of judging, police vetting, public scrutiny of finalists, and signed disclosures from nominees “regarding matters that could bring the awards into disrepute”.

“No evidence was presented or found by the Awards Office to cause concern about his nomination during the 2026 judging process,” a spokesperson said.

Any relevant information would be considered if it was “formally raised”.

The awards office did not answer Stuff’s questions about whether it was considering reviewing the decision to award Drury the title, or whether it had sought any response from him.

Naylor said it was a considered decision to go public with her story.

“For me, this is a reclamation of my mana and the part that was stolen from me … he did this thing to me and the only way I can get it back is if I claim it for myself.”

After the phone call, Stuff sent Drury a detailed list of follow-up questions.

By deadline, he had not responded.