Top universities, including Oxford and Cambridge, have been under huge political pressure to take on minority students after the Prime Minister, David Cameron, attacked them for racial bias and not working harder to broaden their student mix.
Earlier this year Mr Cameron said universities would be forced to disclose the proportion of ethnic minority applicants that get places as he encouraged more transparency.
It now seems that this pressure is leading universities to "take their eye off the ball" in terms of improving quality of research and teaching, in favour of implementing recruitment policies to appease political pressures.
An annual ranking, published by the Times Higher Education (THE), showed Cambridge has fallen to fourth place, down from second last year while Oxford to fifth having been third in one of the most prestigious world university rankings.
The number of UK universities in the top 100 has also dropped from 12 to 10 this year with Bristol and Durham falling out of the list, the table showed.
The table, which is based on the largest invitation-only survey of senior academics across the world, placed only three other UK universities in the top 30 (Imperial, UCL and LSE).
The US dominated the rankings with 43 institutions in the top 100.
Evidently, number one on the list is Harvard, where similar pressures came to the fore after minority students had mental breakdowns because the college wouldn't condemn certain "offensive Halloween costumes."
Perhaps this isn't a positive environment for maximizing one's potential.
The decline in British institutions is partly to do with institutions not recruiting enough high-quality staff from abroad due to increasing restrictions on visas.
It also to do with the pressures on universities to meet quotas to increase the proportion of disadvantaged and ethnic minority students which is distracting them from focusing on research and high-calibre teaching.
Alan Smithers, director of the Centre for Education and Employment Research at Buckingham University, said: "The UK university system is still punching above its weight, but there are worrying signs that its global standing may be in decline.
"In part, this is because for immigration reasons universities have become less open to students and scholars from around the world.
"But it is also because of Government interference. Its current polices are causing universities to take their eye off the ball of recruiting the best to comply with Government demands to increase the proportions entering and graduating from state schools, ethnic minorities and postcodes from which, in the past, few students have come.
Surely, the solution to this problem is more diversity, or at least more spending on "integration."