"I think there may be racism by omission rather than by commission but not institutional racism," he says.
The school has more than 250 bilingual pupils, representing some 35 languages, in a roll of 1,100. It began developing its equalities education programme 10 years ago. Now firmly embedded in its development plan, the school's holistic approach earned it a European Commission Award for Equality Initiative in 1996. It reports very few racial incidents.
"If a racist remark was made by a pupil it would be picked up by other pupils and the perpetrator told it's not on," says Mr Wallace. "The peer pressure is strong and if pupils are upset they know they can report to me.
"We monitor racial incidents according to city policy and last session we reported only two minor ones. I know people will argue that not all racial incidents are reported but I'm pretty sure the ethos and culture of our school encourages reporting," he says.
James Gillespie's High's equalities policy is "organic", says Mr Wallace, covering equal opportunities, social class issues, multicultural education and ethos. It begins with Primary 7 pupils, who attend anti-racism workshops led by S3 pupils.
Events in the Middle East, acts of international terrorism and the strained relations between India and Pakistan and between former Soviet bloc countries have a direct impact on the thoughts and fears of many of the school's pupils whose families are Palestinian, Jewish, Irani, Yemeni, Pakistani, Indian, Russian and Ukrainian. (That's not counting the Chinese, Tanzanian, Quebecois, Icelandic, Spanish and English pupils.) "We have to be aware and be pro-active," says Mr Wallace. "There have been no incidents related to September 11, 2001 or any international situations.
"One Palestinian pupil told us he was getting a hard time out in the city. I think the fact that he spoke to us about it says something for the school's ethos."
The pupils' friendships seem to know no ethnic boundaries. "My son is in S5 here and of his mates who come around the house one is Tanzanian, one Yemeni, one Pakistani, one Palestinian and one, I'm not sure if he's Scottish or English but British anyway," says Mr Wallace.
The school runs a Diverse City initiative which celebrates different cultures in its midst, from Celtic to Bangra and Brazilian, and ethnic minority parents' afternoons are run in tandem with other parents'
meetings, for which the school employs Urdu, Bengali, Cantonese and Arabic translators.
It has two English as an Additional Language teachers, who fulfil a crucial role in a school where the arrival of children with minimal English is normal. The school teaches Gaelic and Urdu and presents pupils for language exams in their own language, even if it is not taught.
"Are we serving these pupils well? We look at course choices and coursing routes and they tell us we are meeting needs at least adequately," says Mr Wallace.
However, he believes the mainstream curriculum is too Euro-centric and that that is not the fault of schools but of examination authorities.
"The secondary curriculum is assessment led and exam bodies have not given equalities education enough thought. You might get a unit on the lives of black people in the United States in history or modern studies but there should be more about black people in this country.
"I think this applies to art and English as well. You have to ask: are they encompassing enough of global culture? It needs change at a national level.
"At James Gillespie's High we have an integrated community but we need a national thrust too.
"A good science teacher, for example, will maybe look at black scientists andor women in science but he doesn't have to according to any curricular demands.
"I think it is equally necessary that the equalities approach to all subjects is pursued in every school, whether it has a large, small or no ethnic minority cultures represented in its school population," says Mr Wallace.
"Going down this road is very exciting. You develop yourself professionally and become more sympathetic to other cultures.
"I know there is a pressure on us all from so many external initiatives presently being imposed on schools, but I'd say to colleagues, don't be scared."