Ethnic diversity refers to the plurality of categories that grant identity in a setting. These are considered ethnic when membership in them is associated with (or believed to be associated with) a common, shared descent. Therefore, a variety of different attributes may signal common ancestry and define group boundaries, including skin colour, language, religion, or place of birth.
Ethnicity is relational, since it derives from the differences perceived between a collective and others. It is only relevant when the traits that differentiate people define social and political interactions or, in other words, when they become institutionalised.