Safety Initiatives in the Railway Business

Every day, countless customers use the services of both Hankyu Corporation and Hanshin
Electric Railway and for precisely this reason, our mission is to ensure their absolute safety andpeace of mind. Our measures to improve safety on a day-to-day basis, and also to ensure safety
when problems occur, are all consolidated in the safety policy and objectives described below.

Safety policy and safety
objectives

Hankyu Corporation 
Safety objective
Maintaining elimination of accidents for which we bear responsibility
For the fiscal years from fiscal 2015 onward, we again set elimination of accidents for which we bear responsibility as our safety objective.
This has been our safety objective since 2006, and we will continue to do our utmost to achieve it.

Safety Policy and Safety Priority Measures
Provide safe, high-quality transportation services that fully justify public trust—Hankyu Corporation: Safety and comfort● Promote awareness to prevent accidents caused by customers● Heighten employees’ safety awareness● Prevent accidents by using accident precursor information andaccident examples● Create open workplace environments● Realise railways with higher safety levels● Conduct training to ensure development of personnel and handing● Expand and improve emergency responses during natural disasters

down of skills● Prevent accident recurrence rigorously by ensuring countermeasure
implementation

Positions and roles

Safety Management System
President
Directors
Head of Urban Transportation Business(Chief Safety Manager: director)

Deputy Head of Urban Transportation
Business

Manager, Urban
Transportation
Planning

Manager, Transport
DivisionManager, Technical
DivisionManager, Kobe
Line Operations

Manager, Takarazuka
Line Operations

Manager, Kyoto
Line Operations

Deputy Operations
Manager (CrewTraining Manager)

Deputy Operations
Manager (CrewTraining Manager)

Deputy Operations
Manager (CrewTraining Manager)(Head of Investment
and Financing Team)(Chief Train Operations (Chief Civil Engineering
Manager)
Facilities Manager)

Manager, Technical
Division(Chief Electrical
Facilities Manager)

Manager, Technical
Division(Chief Rolling StockManager)Group Safety Management
Promotion Committee

Technical Division (civilengineering facilities)
Safety Management
Promotion Committee

Chief Safety Manager
In order to prioritise securing the safety of railway facilities and rolling stockand the handling of operations, and to control and manage transportation
operations in each division, the Chief Safety Manager works to disseminate
safety management regulations and to ensure compliance with related laws
and ordinances; to increase awareness of safety as the Group’s most importantpriority; to confirm the implementation of transportation operations,management conditions, and the progress made in implementing the safety
improvement measures stipulated in the Medium-Term Management Plan;
and to implement improvement measures.

Chief Crew Training Manager
Based on the instructions and orders of the Chief Train Operations Manager,
the Chief Crew Training Manager maintains and manages the capabilities oftrain crews and periodically confirms and submits reports on the progress
being made in improving their capabilities.

Business Division Safety
Management Promotion
Committee
Investigative Committee to Improve
the Safety and Security of Operations

President
The President determines the implementation, the management
organisation, and the rules of the railway business and when formulating the
Medium-Term Management Plan, which includes facilities and transportation,
personnel, investment, and budget, the President verifies and ascertains
the situation from the perspectives of safety and feasibility and instructs
on improvements.

Chief Train Operations Manager
The Chief Train Operations Manager manages operations-related duties,
including utilising the employees involved in operations, railway facilities, androlling stock; setting and revising the operations plan; managing train crews,
the operations of rolling stock, and train operations; and providing training fortrain crews and maintaining their capabilities.

The Safety Management Promotion Committees

Transport Division
Safety Management
Promotion Committee

and other large-scale disasters

Investigative Committee for
Measures to Prevent Accidents

Technical Division(electrical facilities)
Safety Management
Promotion Committee

Technical Division(rolling stock) Safety
Management
Promotion Committee

Other managers and responsible persons
In each division, other managers and responsible persons maintain andmanage the facilities they are responsible for in order to ensure there are no
obstacles to realising safe transportation.
The safety management promotion committees discuss, investigate, andreport on a variety of proposals for transportation safety management. The
safety management promotion committees include the Group Safety
Management Promotion Committee, on which the President serves aschairperson; the Business Division Safety Management Promotion
Committee, on which the Chief Safety Manager serves as chairperson; andthe divisional safety management promotion committees.

Safety Initiatives in the Railway Business

Hanshin Electric Railway 
Safety objective
Maintaining elimination of accidents for which we bear responsibility
We have maintained elimination of accidents for which we bear responsibility since April 1985 up to the present day.

Safety Policy

Maximum priority on safety

Compliance with laws and regulations● The president, directors and employees shall● The Company shall comply with all laws anddo whatever they can to ensure safety ofoperations, based on the understanding that
putting the highest priority on ensuringsafety is the mission of railway businesses.

regulations related to safety and apply themrigorously and sincerely in its operations.

● The Company shall implement continuousverification procedures to ensure safety management systems are operating appropriately.

Positions and roles

Safety Management System

President
The President has the ultimate responsibility for ensuring transport safety.

President
The Railway Safety Council has been
established as an organisation that specialises
in promoting safety management.

Directors
Urban Transportation
Business
Railway Safety Council

Chief Safety Manager(Head of Urban
Transportation Business)

Manager,Manager,
Transport Division Electrical Division

Manager, Rolling
Stock Division

Chief Safety Manager (Head of Urban Transportation Business)
The Chief Safety Manager is responsible for overseeing all activities related toensuring transport safety.
 hief Train Operations Manager (Deputy Head of Urban Transportation
C
Business)
Under the direction of the Chief Safety Manager, the Chief Train Operations
Manager is responsible for operations including train operations, maintaining
the capabilities of train crews, and other related operations.
Transport Division Manager
Under the direction of the Chief Train Operations Manager, the Transport
Division Manager assists in train operations.

Chief Train Operations Manager*(Deputy Head of Urban
Transportation Business)

Chief Crew Training Manager(Head, East Rolling Stock Yard)(Head, West Rolling Stock Yard)

Maintenance of safety management
systems

Manager,Engineering
Division* Previously, the manager of the Transport Division served
as the Chief Train Operations Manager. Following
the establishment of the Deputy Head of the Urban
Transportation Business, however, the Deputy Head
serves as the Chief Train Operations Manager from fiscal
2014 onward.

 hief Crew Training Manager (the heads of the East Rolling Stock YardC
and the West Rolling Stock Yard)
Under the direction of the Chief Train Operations Manager, the Chief Crew
Training Manager is responsible for ensuring all crew are properly qualified.
Electrical Division Manager
Under the direction of the Chief Safety Manager, the Electrical Division
Manager has overall control of items relating to electrical facilities.
Rolling Stock Division Manager
Under the direction of the Chief Safety Manager, the Rolling Stock Division
Manager has overall control of items relating to rolling stock.
Engineering Division Manager
Under the direction of the Chief Safety Manager, the Engineering Division
Manager has overall control of items relating to track, civil engineering andconstruction facilities.

Safety Initiatives in the Railway BusinessInitiatives to Reinforce
the Safety Management System(Using the PDCA Cycle)

By applying our safety management system (PDCA cycle) to a range of safety initiatives, we areaiming to create a virtuous cycle of improvement based on even higher safety goals.

Revisions to the Railway Business Law in October 2006 required
railway companies to create new safety management systems dedicated to transport safety. Under our new safety man-DO

agement system, we are realising even higher levels of safety by

Safety management
implementation andoperation

applying the PDCA cycle, ensuring compliance with all related
laws and regulations, conducting operations that place the highest priority on safety, and fostering greater awareness of safetyissues among employees from directors down.

PLAN
Creation of safetycontrol plans andsystems

Continuous
improvement

CHECK
Safety management
and operational checks

ACT
Improvements(proposals for improvements) and revisions tosafety management
plans and systems

Safety Management
Implementation

To ensure customers’ safety and peace of mind, we implement safety measures for suchfamiliar infrastructure as platforms and railway crossings while undertaking such major initiatives as the construction of grade separations and employee training. The following are
examples of measures we implement year in, year out.

1. Training and Education 
At government designated in-house training centres, Hankyu

act as instructors and provide rigorous one-to-one procedural

Corporation and Hanshin Electric Railway foster train drivers, train

training. Even after personnel have passed certification exams, we

conductors, and railway station operations personnel. During themaintain and heighten the skills, awareness, and qualifications of

training period, trainees hoping to become drivers or conductors

drivers, conductors, and operations personnel by holding safetyreceive education on academic subjects and practical skills inworkshops and seminars and conducting training based on aaccordance with a national curriculum. Also, experienced drivers

range of scenarios.

Safety Initiatives in the Railway BusinessTraining of Drivers, Conductors, and Operations Personnel through an Instructor System
As well as training drivers, conductors, and railway station opera-

appoints as instructors personnel who have at least seven years oftions personnel with national certification by providing education

operational experience, the recommendation of a superior, and theon academic subjects and practical skills, Hankyu Corporation

approval of their division’s general manager. Instructors shoulder aimplements training under an instructor system. In this system,

considerable responsibility because they must instruct trainees withwhen trainees who hope to become drivers, conductors, or railway

precision and empathy. At the same time, however, this responsibility

station operations personnel are learning their respective duties,

provides instructors with an opportunity for personal growth.
The training of drivers and conductors based on the instructor

an experienced employee is designated to act as an instructor andprovide them with on-the-job training.
On-the-job training with instructors lasts approximately one
month for conductors and approximately three and a half months for

system began roughly 50 years ago. Since then, while adapting thesystem to reflect changes in current needs, we have kept it at theheart of our safety training.

drivers. The mentoring relationship that this training process engenders promotes the sharing of a strong commitment to safety andnever causing an accident. By performing actual duties under thesupervision of an experienced instructor, candidates not only acquire
knowledge and skills but also an appreciation of the paramountimportance of ensuring safety in railway operations.
To foster personnel with advanced safety awareness, knowledge, and skills, securing the outstanding instructors that underpin the instructor system is indispensable. Therefore, Hankyu
Corporation concentrates efforts on training instructors. The company

2. Equipment-Based Countermeasures and Equipment Inspections 

Initiatives for Natural Disasters
1. Responding to rain storms

3. Responding to actions of third parties, such as acts of terrorism

During rain storms, we direct trains to reduce speed or suspend

If there is a warning that the actions of third parties, such as acts ofoperations based on information obtained from the rain gauges, wind

terrorism, could cause serious incidents with extremely significant

gauges, and water meters installed alongside our railway lines andeffects on society, or if such a warning calls for continued vigilance, or

meteorological information from the Japan Meteorological Agency.

if suspicious items or persons are discovered or damage is incurred,
we take measures appropriate to the threat level.

2. Responding to earthquakes
If earthquake early warning systems forecast an earthquake with aseismic intensity of four or above, or if seismographs installed alongside our railway lines detect an earthquake of the same seismic intensity, we immediately begin procedures for the emergency suspensionof the operations of trains on line segments in earthquake zones.

Further, we have installed security cameras in railway stations
and station concourses to prevent crime.

Safety Initiatives in the Railway Business

Maintenance Work: Indispensable for Safe, Comfortable Operations
We have many different types of electrical equipment, including signal safety equipment, secure communication equipment, railway crossing
safety equipment, power equipment, railway track equipment, and substation equipment, which we inspect regularly based on prescribed
inspection schedules.

Scheduled inspection of a signal

Scheduled inspection of securecommunication equipment

Abrasion measurement by an overhead-wire-inspection vehicle

Inspection of substation equipment

Inspection of railway tracks is indispensable to ensuring the safe operation of rolling stock. Further, we implement corrective grinding of slightly
uneven parts of rail surfaces to improve ride comfort and implement corrections to reduce noise and vibration.

Railway track inspection vehicle

Vehicle for the corrective grinding of rails

We conduct inspections at our plants to maintain the safety of rolling stock. Regular inspections include train inspections, monthly status andfunction inspections, main component inspections, and overall inspections. In addition, we conduct unscheduled inspections as required.

A monthly status and function
inspection

An overall inspection

Main Component Inspections
We inspect the main components of power generation devices, running devices, brake devices, andother important devices every four years, or before rolling stock covers a distance of 600,000 km in thecourse of operations, whichever is the shorter period.

Principal Risks and Countermeasures

The Hankyu Hanshin Holdings Group’s approaches to risks related to businesses and other risks that may be of concern toinvestors are stated below.
Further, forward-looking statements in this report reflect the Group’s assessments as of 31st March 2015. Moreover,these statements do not negate the possibility of the said risks affecting the Group’s business results or financial position.

Principal risks

The Group’s countermeasures

Risks related to economic conditionsB orrowing rates could increase due to changes in financial
markets or fund raising from markets could become difficult.

T he Group limits exposure to the risk of interest rate increases bygiving priority to the undertaking of long-term loans with fixedS udden changes in financial markets could affect the Group’sbusiness results or financial position.

interest rates.
The Group secures financing by establishing backup lines ofcredit based on commitment lines set up with correspondent
financial institutions.

Changes in the economic climate could cause exchange rate
volatility.

The Group uses forward exchange contracts, currency swap
contracts and currency option contracts to mitigate exchangeG reater-than-expected volatility could affect the Group’s business results or financial position.

rate fluctuation risk associated with certain foreign currencydenominated monetary payables and receivables.
	 Further, the Group’s overseas sales were less than 10% ofconsolidated revenues from operations as of 31st March 2015.

Risks related to businesses
The further aging of society is expected to increase capital investment for safety countermeasures and construction to make facili-Through continuous initiatives to heighten the value of the
Umeda area and other areas served by Hankyu and Hanshinties barrier-free.

lines, the Group creates line-side areas in which people want toDue to population decline resulting from lower birthrates, the Group’s
railways, buses, and taxis could see demand for passenger transporta-

live permanently or visit frequently.

tion decrease. Also, demand could decrease in other business.

T he Group has set its sights on growing by developing suchnew markets as the Tokyo metropolitan area market and overseas markets.

A n accident in the railway business could cause customers great
suffering.

T he Group is keenly aware that being entrusted with passengers’
lives is a serious responsibility. Therefore, placing first priority on
ensuring the safety of customers is the basis of its business
management.
B ased on its strong commitment to putting customers first andgiving the highest priority to safety, the Group is implementing awide range of measures to upgrade tangible and intangible infrastructure and provide customers with improved safety.
For details about safety measures in the Urban Transportation Business, please see
pages 66 to 70.

P ower supply shortages could disrupt train operations and otherservices. Also, higher electric utility rates could increase power andT he Group is steadily introducing energy-saving equipment tocurb power consumption as much as possible.

other costs.

The Group takes rigorous measures to ensure employees areaware of the importance of cost reductions.
For details about the introduction of energy-saving rolling stock in the Urban
Transportation Business, please see page 43.

Principal Risks and Countermeasures

Principal risks

The Group’s countermeasuresA loss of trust in the quality and safety of products and services
that the Group sells and offers or in the information it provides

T he Group ensures the quality and safety of its products and services
and the appropriateness of the information it provides about them by

about them could lower revenues and lead to a deterioration in

confirming compliance with relevant laws and regulations andbusiness results.

checking quality and hygiene management and food labelling.

Natural disasters, such as earthquakes, typhoons, or floods, or actsof terrorism could significantly damage the Group’s businesses orIn the areas alongside their railway lines, Hankyu Corporation andHanshin Electric Railway Co., Ltd. have installed water meters fortransportation network infrastructure.

rivers and rain and wind gauges for collecting observation data.
Also, they use real-time information from meteorological observatories to ensure safe train operations.
If seismographs detect an earthquake with a seismic intensity offour or above, or if earthquake early warning systems forecast an
earthquake of the same seismic intensity, the Group immediately
begins procedures for the emergency suspension of the operations of all trains on line segments in earthquake zones.
If the Group recognises that continued vigilance is required withrespect to acts of terrorism or other acts, or if suspicious items or
persons are discovered or damage is incurred, it conducts crisis
management appropriate to the threat level.
The Group has established emergency response systems for minimising the effect on society in the unlikely event of an incident
that causes a long disruption to transportation services or results
in a large number of casualties.

An outbreak or epidemic of an infectious disease such as severe
acute respiratory syndrome (SARS) or a new strain of influenza
could restrict economic activities or discourage customers fromgoing out.

In preparation for the spread of an infectious disease, such as a newstrain of influenza, the Group’s core companies have directed theestablishment of business continuity plans for each business division.
	  During the outbreak of a new strain of influenza in 2009 and 2010,
the Group minimised the effect on its businesses by determining thelevel of risk through ongoing surveys of each business division in relation to infection rates among employees and their families.
In the railway business, which provides a particularly importantpart of society’s transportation infrastructure, the Group has established specific response plans in advance. For example, it has
prepared multiple timetables based on scenarios envisaging
shortages of transportation personnel due to the sudden spreadof an infectious disease.

For further information on risks related to businesses and other risks, please see page 77.