Parekh's theory of multiculturalism offers a number of insights which are u
seful in analysing the role of neighbourhood governance in promoting social
cohesion within culturally diverse small areas. The problems of neighbourh
ood governance are rooted in disjointed structural change across Europe ove
r the past 25 years. In this context, the formation of a multicultural Euro
pean polity risks creating a white European ethnicity which will institutio
nalise specific forms of racism within distressed neighbourhoods. At the sa
me time, the shift from government to governance as a way to address the pr
oblems of governability in structurally reconstituted societies is associat
ed with the top-down imposition of specific forms of neighbourhood governan
ce which can then, unwittingly, become part of the institutionalisation of
racism. Using Parekh's theory to construct a critique yields a set of princ
iples which illuminate a number of key strategic elements which can be used
practically in designing neighbourhood governance mechanisms and which ill
uminate the pre-occupations in the existing literature.