Nordic universities are turning to the private sector in an unprecedented attempt to raise research funds.

Staff, students and governments from Iceland to Finland generally oppose student fees as a way of financing higher education, so universities have been forced to turn to other sources.

The Swedish 51¹ú²úÊÓƵ of Lund, for instance, has a spin-off company, LU Education, which has signed a 25 million kronor (?1.3 million) four-year contract with the European Union to aid and supervise research projects.

Univa, another company operated by Lund, sells expertise in product development, exploiting the research generated by its academics. Lund, surrounded by the biggest science park in Scandinavia, is now developing a new science park in the nearby city of Helsingborg.

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Scandinavian researchers are encouraged to exploit their discoveries commercially and keep the intellectual property rights.

However, Kari Raivio, rector of Helsinki in Finland, said: "Public funding is still considered important." But the university runs two commercial companies, Helsinki Consulting Group, which provides human resources services, and Licentia, which licenses the university's research.

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Mr Raivio is confident that in Finland the risk of academics deserting higher education for jobs in industry is not a problem. "The recruitment and staff retention aspect is not yet relevant in Finland," he said.