Nettlefold said Nugent will continue as Swimming Australia head coach and will be supported by extra staff under a new structure.
"There will be a new structure and more support around Leigh Nugent to do his job properly and give him the right support to do what he has done before for this country."
Nugent has been criticised for his handling of the relay team's misbehaviour during their bonding session in Manchester.
The six-member relay team has admitted to taking Stilnox and knocking on doors of swimming team-mates at their Manchester hotel ahead of the London Olympics last year.
Nettlefold said he believes Nugent was informed of the door knocking the following morning but not the taking of Stilnox.
Asked why Nugent did not take any further action Nettlefold said he had not discussed it with him.
"That, I haven't discussed with Leigh, that will be put to the integrity panel," Nettlefold said.
Silver medallist Emily Seebohn said she had told Nugent what was going on and was not impressed to hear that he had originally denied any knowledge of the events.
Seebohm said the truth needs to come out and if it does not she is prepared to tell the whole story.
"So, you know, to be on the team with him - I wasn't too happy with that."
History of misbehaviour
Former Olympic swimmer Lisa Curry told ABC News 24 that there has been a history of hazing and misbehaviour within the Australian swim team.
Curry represented Australia at the Olympic Games in Moscow, Los Angeles and Barcelona/.
She says she experienced the type of behaviour that female swimmers complained about in London.
"Absolutely and these boys are not alone. There's been initiation and misbehaviour in all sorts of teams all over the world in every different sport. Sometimes it's disregarded," she said.
"I know for a fact if it happened while Don Talbot was in charge, they would be sent home without a doubt.
"I just can't believe as elite athletes that they would even put themselves in this position where they were experimenting with Stilnox and energy drinks.
"It just defies being an adult and being an elite athlete. Why do you do that and self-sabotage one of the greatest events of all time?"