Kate Hayward CA’s childhood was marked by economic insecurity. Now UK Managing Director of Xero, she hopes to help bring financial literacy to every classroom. She talks to Ryan Herman about tax simplification, reading the numbers and why accountants are ‘people people’

Onstage at Xerocon, guest speaker Louis Theroux is struggling to articulate to an audience of 1,800 financial professionals why somebody would grow up aspiring to become an accountant. Finally, he hits on an answer: the one thing that unites them, he suggests, is that they’re good with numbers.

His interviewer, Kate Hayward CA, interjects: “What they also have in common is they like to help people.”

Around the room, heads nod in agreement with Xero’s UK Managing Director. Picking up on the theme, Theroux – himself a Xero customer – reasons that people tend not to speak openly about their finances, even with friends, but inevitably do so with their accountant. So there is, he posits, a unique relationship between the two.

Talking to CA magazine just as Xerocon, held over two days in July at London Olympia, is winding down, Kate expands on this point: “Yes, accountants are ‘numbers people’, but they’re also ‘people people’. So many of them go above and beyond, because they’re trying to help small businesses thrive.

“As Louis said, they often see into the bank accounts, they see all the personal data that’s not up on the internet, so they have a deep privilege and a deep responsibility that they take very seriously.”

At the end of her wide-ranging conversation with Theroux, which covered everything from his own production start-up to interviewing violent criminals in high-security US prisons, Kate had revealed to the audience that she’s actually an introvert. So how does it feel interrogating arguably the UK’s most famous inquisitor?

“I’ve been in the MD role for two years,” she says, “and when I started, I thought I had to be someone else. But I’ve realised that if I’m me it’s easier – you don’t need to be someone else. And going up on stage, like at Xerocon, I know so many of the customers in the room, and they don’t want me to fail.

“It’s still nerve-wracking, but I know they’re behind me. And, yeah, [interviewing Theroux] was a great moment.”

Seeking stability

While it’s true that accountancy careers aren’t the typical stuff of childhood dreams, it’s a simple fact that the CA qualification provides a real platform for a successful career.

Kate’s journey is just one of the many examples. She grew up in Gravesend, Kent. Her father was a carpenter, but his work was often sporadic. At an early age, Kate decided she would pursue a career that afforded her a regular income and stability.

Initially, however, she studied biology at the University of Southampton. She graduated with first-class honours, but concluded she didn’t want to spend her working life in a laboratory. At a university careers fair, she met a representative of Ernst & Young (now EY), who explained that the Big Four firm offered a summer graduate scheme, allowing her to earn while she learnt.

Kate, who liked being a problem solver, decided accountancy suited her skillset and would likely prove an ideal path towards financial security.

“I was so glad for my training from Ernst & Young because I got to sit in on meetings with clients on day one. Those soft skills have put me in good stead for the rest of my career – to read those signals, to understand how the technical and people skills come together.”

After four years with EY she moved to Australia, where she spent one year with KPMG and two at Deloitte, but was approached by Xero in 2019 to take on a big role as Executive Manager for Global Strategy spanning Europe, the Middle East and Africa.

Recently married, Kate wanted to start a family, and her first instinct was to turn the job down, assuming she wouldn’t be able to balance motherhood with her professional life. It was only when her prospective boss at Xero told her there was no reason why becoming a mother should prevent her from excelling in her job that she decided to accept the offer.

“Society still sees the woman as the primary caregiver,” she says. “The number of times I’ve had a call when my child is sick, even though my husband is on record as the first point of contact…

“In the future very few families will be able to survive on one income, so I think there should be a conversation around childcare. When you expect people to work above and beyond, it’s the childcare cost that’s often the hardest. That’s a conversation we need to have in the UK.”

Small is beautiful

Apart from her boss’s positive attitude towards parenting, one of the key reasons Kate joined Xero was its mission to “make a difference for the small business economy”. Life post-pandemic has been especially tough for many SMEs. Take the issue of late payments, or ‘unapproved debt’. Many of us will have seen emotional LinkedIn posts from entrepreneurs who were forced to close their businesses because too many clients took too long to pay their invoices.

Xero, which has campaigned on this issue, welcomes the Small Business Protection Bill, currently working its way through Parliament.

According to the government, “Reforms include a clear 60-day cap on payment terms on all large firms paying smaller suppliers, mandatory interest on late payments, set at 8% above the Bank of England base rate, and a ban on the practice of withholding retention payments under construction contracts.”

“We were very, very happy when that was announced,” says Kate. “It was long overdue – finally there’ll be some protection for small businesses. We’re looking at ways we can support that and make sure people are doing the right thing.”

Another pressing matter for Xero, and other providers of accounting software, is Making Tax Digital for Income Tax Self Assessment (MTD for ITSA), which has finally been rolled out after years of delay. It is fair to say this hasn’t been greeted with universal acclaim, but what feedback has Xero been getting from its customers?

“From small business owners, I think there was probably a lack of understanding of what it meant and what it looks like. My favourite story comes from a taxi driver, who was a Xero customer, who said to me how much he had been dreading MTD. He spoke to his accountant, who said, ‘Come in, and we’ll train you.’ He was given a bank reconciliation, which is where you match your bank fees to invoices and receipts. He now does it regularly and it gives him a real-time view of his accounts and his business.

“Whether it’s tax, compliance or something else, storytelling is the answer: it simplifies what small businesses need to do, and it’s something we could all do better”

“But there is a hump to get over [explaining] what that means for small businesses. Some may have buried their heads in the sand, and I would encourage them to speak to an accountant in the next month to get it sorted.

“The optimist in me thinks long term it will be really positive for accountants and bookkeepers. But people are going to find it quite hard work at first.”

More broadly, there is still a common gripe among small business owners that the tax system is too complicated. “Whether it’s tax, compliance or something else, storytelling is the answer: it simplifies what small businesses need to do, and it’s something we could all do better,” says Kate.

“We don’t have one unique business identifier in the UK, and I think we should, because you have this number, this number and this number. Simplifying that would help small businesses simplify across tax and everything else they have to do [to remain compliant]. Reducing that admin would be my answer.”

Expansion plan

When Kate joined Xero in 2019, the New Zealand-based firm had around two million customers worldwide. It now has just shy of five million and last year recorded revenue of NZ$2.1bn (£900m), having turned its first profit in 2024.

Meanwhile, the number of accountants in the UK has grown by 17% over the past three years. Yet there are fears that growth could stall, while the post-pandemic surge in SMEs, particularly sole traders, has levelled off.

“We are a nation of small businesses, and yet a nation without financial confidence”

Kate has one solution for stimulating growth in both accounting and SMEs – financial literacy. “Having a base knowledge of accountancy means financial literacy along with an understanding of the commercial side,” she says. “You learn how to talk to people and connect, and you learn digital skills. They are the fundamental capabilities that will set you up for life. Whether you work in a creative field, marketing or something entirely different, having some base of financial literacy provides so much benefit.

“We are a nation of small businesses, and yet a nation without financial confidence. I think that’s key. Entrepreneurship should be a universal right, not just for those from certain backgrounds, whatever that might look like.”

This is something of a mission statement for Kate, who has been closely involved with the Maple Review. Led by Small Business Britain, with backing from the UK government and support from Xero, the Maple Review aims “to identify and dismantle the barriers to entrepreneurship caused by economic deprivation”.

“One of them,” says Kate, “is financial literacy. There’s a bit of a stigma for some people: ‘I’m not a numbers person so I can’t run my own business.’ It stops them going into entrepreneurship. That shouldn’t be the case. One of the report’s key recommendations was the introduction of a national financial literacy programme in secondary schools. We’re really hoping that at some point there will be an announcement that will mean every secondary school child will have a business and financial education.”

This goes back to Kate’s childhood in Gravesend, when the family never knew how much was coming in from one month to the next. The Maple Review couldn’t feel closer to home.

“If we manage to launch financial education in secondary schools, knowing that my two children, who are five and three, will learn about business finances because of something Xero was involved in would make me cry,” she says. “Genuinely, I think it is the best thing that we can do for our future generations.”

xero.com

For more resources visit the ICAS MTD hub