Kwame Ture, then known as Stokely Carmichael, and political scientist Charles V. Hamilton introduced the term in their 1967 book Black Power: The Politics of Liberation. They separated individual racism, such as a violent attack, from institutional racism, which they described as less visible but just as destructive. It lives in the ordinary rules of how organizations run.
Federal drug sentencing is a clear example. The Anti-Drug Abuse Act of 1986 set the same mandatory minimum for 5 grams of crack cocaine as for 500 grams of powder cocaine, a 100-to-1 ratio. Crack defendants were mostly Black, so Black people received far longer sentences for similar conduct. The Fair Sentencing Act of 2010 reduced the ratio to 18-to-1, but did not eliminate it.
Institutional racism can be changed by changing rules, which is why ARD focuses on policy. Examples include school discipline codes, hiring requirements, lending criteria and hospital algorithms. Each can be audited for racial impact and rewritten.