Abroad, women boost earnings, but clout is iffy

There's a rising tide of female market power across the globe. Call it the feminization of the economy. For example: • Economic activity of women grew in every region of the world during the 1980s and 1990s, except for Oceania, sub-Saharan Africa, and the former Soviet states, according to a report issued in January by the United Nation's Millennium Project.

• By 2002, women in several nations - including New Zealand, Finland, and Britain - held more than half the nonagricultural jobs, the UN study found.

But there's a disconnect. In societies where women traditionally have borne responsibility for managing money, the private sector is now rolling out high-end financial services to cater to women's sensibilities and preferences. Meanwhile, in settings where women historically have not held such roles, cultural and legal hurdles seem to be sustaining a glass ceiling - even for women whose incomes have doubled or tripled in recent years.

Example: Japan. A dozen Japanese mutual funds specialize in socially responsible investments (SRI), according to a 2004 study from the Natural Capital Institute. Prior to 1998, SRI was virtually unknown in Japan. But now the industry is growing, thanks to an investor base that is mostly female.

"It is said that [Japanese] women care more about the future planet ... and [are] more concerned with safety and reliability of goods and services they purchase" than Japanese men are, says Kyoko Sakuma, executive director of Sustainability Analysis and Consulting in Brussels. A rash of recent scandals involving unsafe food, she says, accounts for a surge of interest in this sector among Japan's female investors.

For generations, women in Japan have been the unofficial "finance minister of the family," giving monthly allowances to their husbands and children, says Setsuko Sakakibara, president of Albero Sacro Limited, a Tokyo financial advisory firm.

Now, she says, banks and investment houses are rushing to set up divisions specifically for female clients. One example: In November, financial services giant Nomura Securities in Tokyo opened a financial-planning department exclusively for women.

But about 1,800 miles to the south, in the Philippines, women are encountering more limited success. Corazon Endonela, for instance, parlayed an initial microfinance loan of $35 into a sewing machine and a livelihood for herself, her two sisters, and a neighbor in the village of Makati. Josephine Posada has done likewise, selling recycled cardboard in a slum outside Manila with the hired help of six teenage boys.

Women like these receive the lion's share of microfinance loans in developing nations. A full 90 percent of the $281 million that Oikocredit. a microfinance cooperative, loans overseas goes to women, says Terry Provance, executive director of Oikocredit USA.

The reason: Women pay their loans back more reliably than men. And in an age when global firms are looking to outsource labor, enterprising women are filling niches from Peru to Bangladesh, where women's share of nonagricultural work jumped from 17.6 percent in 1990 to 25 percent in 2002.

Despite gains in earning power, women in developing nations seldom reach the point of qualifying for commercial bank loans, says Brian Hooks, director of the Global Prosperity Initiative at George Mason University's Mercatus Center. "Very rarely do you find a case where people graduate to the formal financial sector" from informal, often home-based, businesses.

Lack of collateral commonly stands in the way. Where laws or cultural norms keep women from owning real estate, as Mr. Hooks witnessed in the Philippines, boosts in income aren't enough. In such an unregulated domain, women seldom make strides in terms of improved working conditions, says Geeta Rao Gupta, co-coordinator of the UN task force on gender equality and president of the International Center for Research on Women. "There is a sort of implicit assumption that just giving a woman a little bit of money is a good thing," Ms. Gupta says. "It sustains them.... There's opportunity, but it's not opportunity beyond providing them a meager income."

The contrast between women in Japan and in the Philippines echoes around the globe. In the Middle East and North Africa, women accounted for 15 to 20 percent of the nonagricultural workforce in 2002, according to the UN study. In the United States, women's growing earning power has firms lining up to serve them.

"Because of women's lack of confidence when it comes to managing dollars, by nature they are probably more likely to seek out professional advice than their male counterparts," says Dyanne Ross-Hanson, a financial planner in Minneapolis who has seen her clientele of wealthy individuals shift from about 10 percent female to 30 or 40 percent over the past five years. "I think that financial advisers today who can respond to the particular needs of women investors are going to flourish."

In 2002, the College of St. Catherine in St. Paul, Minn., launched a program to train women as financial advisers. But getting women to enroll has been "a bit of a sell," says program manager Sarah Rand. "The industry doesn't have a positive reputation right now. [Because] women want to put their talent to work in a way that reflects their values," they seem to need some coaxing before jumping to serve a market already populated with successful women, she adds.