Cream the butter and sugar in a small bowl using electric beaters until light and fluffy. Add the vanilla and egg and beat until well combined. Transfer to a large bowl and add the sifted flour and baking powder, the coconut and macadamia nuts. Using a flat-bladed knife, mix to a soft dough. Gather together, then divide the mixture into two portions.
Place one portion of the dough on a sheet of baking paper and press lightly until the dough is 30cm (12inches) long and 4cm (1½inches) thick. Fold the paper around the dough and roll neatly into a log shape. Twist the edges of the paper to seal. If you like you can shape the log into a triangular shape, to give triangle-shaped biscuits when sliced. Repeat the process with the other portion of dough. Refrigerate the dough for 30 minutes, or until firm.
Preheat the oven to 180°C (350°F/Gas 4). Line two baking trays with baking paper. Cut the logs into slices about 1cm (½inch) thick. Place the slices on the prepared trays, leaving 3cm (1¼inches) between each. Bake for 10–15 minutes, or until golden. Cool on the trays for 5 minutes, then transfer to a wire rack to cool completely. Store in an airtight container.