Over the past few decades, in many western countries with large immigrant populations, inequalities in education relating to ethnic background have increased. Interventions traditionally consist of selective compensatory arrangements that focus on instruction in the second language--especially in early stages of schooling--and the treatment of issues of difference, equality and racism within the curriculum. This article discusses recent educational policies that attempt to systematically integrate aspects of linguistic and cultural diversity and equity targets within broader policies of school effectiveness and school improvement. The paper presents the author's findings in an international comparative study of school-improvement strategies that tackle ethnic inequalities in education in Germany, Switzerland and England. Using theories of institutional discrimination and organizational action, strengths and weaknesses of these strategies in their specific political context, particularly structural limitations for inclusiveness resulting from market- and performance-oriented education reforms, will be highlighted. (Contains 2 notes.)