Midlands Innovation is a strategic partnership of eight research-intensive universities. Universities in the Midlands and the pan-regional growth body, the Midlands Engine, are piloting how universities can work together to attract Foreign Direct Investment into regional Research and Development.
HEPI’s report, The role of universities in driving overseas investment into UK Research and Development, published on 7 March 2023 provides national analysis of what is happening in this space.
Here, Professor Karen Holford CBE FREng, Vice-Chancellor and Chief Executive of Cranfield University, writes as the first in a series of blogs from Midlands Innovation on the key considerations for policymakers and the higher education sector on increasing investment into regional R&D through universities.
Foreign investors play a vital role in the success of UK R&D and are increasingly becoming a key source of private funding into university research. Across 15 universities in the Midlands, Foreign Direct Investment (FDI) accounted for around 37 per cent of all industry income in 2019/20.
The UK is recognised as one of the best places in the world to invest in R&D. Investors are attracted to excellent academic talent, facilities and the UK’s clusters of specialist expertise. The UK benefits greatly from its global connections and international research collaborations.
Collaborations with international partners are vital to the continued growth and success of the economy, for creating opportunities for our young, and adding richness and variety to social and cultural life.
But there is a balance to strike, and we must ensure that in our search for partners we do not risk the security of our research.
This is something that Cranfield University, founded in the post-war years at the instigation of government and industry, is well versed in. Our history of close relationships with industrial, academic and government partners means that research security is embedded in our culture. Working on highly sensitive international and commercial projects is something Cranfield has done for decades.
FDI is crucial but security isn’t an optional extra
Inward investment and partnership building is a crucial component in realising the Government’s ambitions to become a scientific superpower, and the 2020 UUKi report Future International Partnerships articulates the influential role universities have.
International investors are generally more agile, willing to take risks and have a drive to commercialise R&D. They also want to invest long-term to see technologies come to fruition – this brings a real opportunity for strategic investment and development of research, enabling us to work at scale. However, there is a level of risk.
Geopolitical tensions, a fast-changing external environment and a myriad of legislation makes research security a complex area. And the higher education sector has a duty to its academic staff, industry partners and international colleagues to operate in a secure way.
This isn’t an optional extra – it is essential; the reputation of UK universities depends on it.
The National Securities and Investment Act (2021) is front of mind for university research ethics groups. The impact of this is already being felt with the recent blocking of a UK university licensing deal. It is now integral to how we work, and universities should draw on the Research Collaboration Advice Team and the Higher Education Export Controls Association for advice and to protect international projects.
The Cranfield experience
At Cranfield University we embed security within our research culture. We have adopted a holistic and evolving approach to security ensuring it is proportionate across the relevant aspects of our activities. We have also recognised the need for a country agnostic approach to avoid prejudice, discrimination and impact on our international community.
A physical embodiment of an international collaboration and a result of FDI is the Aerospace Integration Research Centre – an innovative hangar space and laboratories where multi-nationals work alongside academics. Similarly our Digital Aviation Research and Technology Centre involves international partners using the latest technologies to address aviation research challenges.
The understanding of commercial confidentiality runs deep in everyone working in these spaces and is highly protected. Robust mechanisms guarantee safe, secure internationalisation. This gives industry partners and investors confidence in our security and research integrity.
Key to delivering these projects is a focus on supporting staff; with development opportunities to explore commercial, ethical and security aspects of research. Sharing knowledge around how to operate with partners complex security needs is vital to protecting research integrity as individuals and institutionally.
Stronger through collaboration
The complexities of FDI can be difficult for universities to navigate, which makes it essential that we work together to share good research security practice and collaborate to attract inward investment to the benefit of all. A joined-up consistent approach is a powerful prospect for investors and gives them confidence in robust research security. Anchoring opportunities regionally or as part of a cluster of expertise represents a strong way forward and we need coordination as a sector to deliver this.
One such example is the way in which Midlands Innovation is currently contributing to a Department for Science, Innovation and Technology funded pilot in the Midlands, working with UUKi, UKRI and NCUB, developing a forward plan to attract investment. This long-term approach could create a more ambitious approach to FDI which would benefit many universities and their regions. I welcome the pilot, working together will improve our approach to security, and opens the door to working together to attract investment.
Ultimately, we all have a role to play in helping to unlock the potential of FDI, and universities are pivotal as a bridge between local partners, government and industry. Only by working together will we achieve our ambition of making the UK a scientific superpower.