Speaking at a reception to mark the start of the UK-US Higher Education Policy Forum, Martin Davidson cited research carried out on behalf of the British Council by polling firm YouGov showing the attitude of British students to globalisation.
He said that at the individual institutional level, US and UK universities had a history of success on collaboration and globalisation. However, he added, the UK sector as a whole perhaps had not been "quite as successful" when it came to globalisation and students.
"Few British undergraduates view globalisation as having anything to do with them," Mr Davidson said. "Awareness of global competition for jobs is high, but virtually no British undergraduates think that it is going to affect them."
Mr Davidson said the forum, held last week in Windsor, would be key to changing the attitudes of young Britons on the importance of globalisation.
"If we are going to be a truly effective global partner, then we have to have truly effective young people with global experience," he said.
At the event, a variety of presidents, vice-chancellors and representatives of higher education institutions from both sides of the Atlantic discussed the challenges, opportunities and potential growth of partnership opportunities between the two countries.
The forum was lauded by President Barack Obama during his visit to the UK earlier this year as an example of how the two countries were working together.
Mr Davidson said he agreed that the forum was an important event.
He added: "If we get this right, we will affect not just the UK-US relationship, but actually the way that we in this country achieve greater recognition of the impact these exchanges have on students' lives, and get them thinking about the rest of the world in a different way."