The traditional position of European universities is under threat, university chiefs have been warned.

Universities have lost their monopoly on teaching and research, with global corporations now running their own higher education programmes and buying in expertise from moonlighting professors, according to leaders of the Association of European Universities (CRE), which met in Berlin this week for its eleventh general assembly.

A Europe-wide study commissioned by the CRE has concluded that institutions must redefine their role to regain the initiative by building stronger working relationships with industry, local authorities and student groups.

Andris Barban, CRE general secretary, said: "There are all sorts of other higher education providers beginning to offer the kind of services that universities once held a monopoly over. Perhaps some students may prefer to have a degree from, say, Intel, than from Oxford Brookes University, for example. Universities need to respond to this challenge."

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A report on the findings of the study, warns that "this is an issue of growing urgency and importance", and "universities must respond to the challenge or face the consequences of being left behind by the rest of society".

The study, which examined relations between universities and their stakeholders in 19 different regions in Europe, found that while universities are increasingly conscious of the need to build new strategic alliances, few are doing so. And there was "almost no evidence" of arrangements for regular input into the content of higher education from stakeholders in any region.

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The report says the slow response of universities to stakeholder needs means that professional training must often be delivered outside universities.

Although universities are expected to play an important role in technology transfer and as a magnet for inward investment, institutions often have no coherent strategy for turning this into a reality.

The report says: "It may also be questioned whether prevailing university structures and leadership roles are adequate for the type of networking now being demanded of higher education institutions."

The report proposes that the CRE should set up a network of universities across Europe to share and disseminate best practice.

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Opinion, page 10