The Otago University Students’ Association (OUSA) and a group of academics have called on the institution to "block" its involvement with the Silicon Valley company, which includes assisting with the development of courses for the Queenstown Campus.
The groups say Palo Alto Networks (PANW) has ties to the IDF and government.
In March, PANW secured a $250 million contract to supply the Israeli government, while the company was founded by Nir Zuk, a former IDF officer who served in Unit 8200 (cyber warfare) and was head of software development.
University of Otago vice-chancellor Grant Robertson has previously said he did not "accept the characterisation of the partnership" as being linked to warfare.
However, yesterday he said the university was drafting and consulting on guidelines for how to develop and review academic partnerships.
"Given that, and given that there have been developments involving Palo Alto since the university signed the agreement in May 2025, we have decided to review the partnership now," Mr Robertson said.
"Regardless of the outcome of this review, the university is fully committed to developing its presence in Queenstown.
"This includes the master’s of digital technology programme. Work on that qualification is continuing, and we look forward to welcoming the first intake of students in 2027."
The university had a wide range of academic partnerships and agreements, ranging from those undertaken by individual academics through to those at an institutional level, he said.
"In thinking about the development and review of these partnerships we need to balance important considerations, including academic freedom, delivery of relevant programmes, university values and ethical standards and our policies, including on institutional neutrality.
"We also want our considerations to be evidence based. Balancing all of this can be a challenging exercise, and our consideration of guidelines needs to be careful and widely consulted on."
"Students have consistently raised questions about the ethical implications of the university’s relationships, and this review represents an important opportunity to engage meaningfully with those concerns.
"OUSA believes universities should not only pursue academic and technological excellence, but also demonstrate social responsibility and alignment with human rights principles."
OUSA political representative Flynn Nisbett said he had been shocked by the original announcement of the partnership with PANW.
"A company involved with developing weapons and technology to carry out a genocide is not in line with university values of being the critic and conscience of society.
"Students come to Otago to learn critical thinking and a self-motivated work ethic, not to be slaves to capitalist, genocidal workforce recruitment. We oppose the PANW deal, in the spirit of academic freedom, student ethics and the sanctioning of Israel’s actions in Gaza."
Peace and conflict studies professor Richard Jackson said it was good to hear the university was reconsidering its involvement with PANW.
"The university has taken seriously the information that we’ve given them, and its deep connections to the Israeli state and the Israeli military - it appears they are seriously now reviewing in light of that information.
"I mean, the reality is that some of the things that we’ve uncovered that [PANW] has been involved in has happened since they first came up with the idea of partnering with them. So it may be that some of the things we uncovered hadn’t happened yet, and so they weren’t aware of them."
Prof Jackson said in an "interconnected world", the university had to be extra careful to avoid reputational or ethical risks to the institution.
"The risks are very high if you pick the wrong company.
"So I think the lesson is the university has to put a bit more effort into investigating those companies that it works with to ensure it’s not getting entangled."
Prof Jackson said there would be a public meeting on campus discussing these very subjects on May 19.
Mr Robertson said the university would announce the outcome of the review to the university community when it was complete.
