Safety Initiatives

Safety policy andsafety objectives

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.

Hankyu Corporation

Hanshin Electric Railway[Safety Policy][Safety Policy]

Provide safe, high-quality transportation services that fully
justify public trust• Maximum priority on safety“Safety and comfort,” Hankyu Corporation[Priority safety measures](1) Increasing awareness of safety, safety measures(2) Measures to improve safety(3) P ersonnel training and technology transfer provided
uniformly in all Group companies’ business divisions[Safety objectives]

Maintaining zero accidents for which we bear responsibility
In fiscal 2014, we once again set the safety objective that we haveset since 2006, of “Maintaining zero accidents for which we bear
responsibility,” and we are working diligently to achieve this objective.

Safety Management System

The president, directors and employees shall do whatever they can toensure safety of operations, based on the understanding that putting thehighest priority on ensuring safety is the mission of railway businesses.

• Compliance with laws and regulations
The Company shall comply with all laws and regulations related tosafety and apply them rigorously and sincerely in its operations.

• Maintenance of safety management systems
The Company shall implement continuous verification procedures toensure safety management systems are operating appropriately.
[Safety objectives]

Maintaining zero accidents for which we bear responsibility
We have maintained zero accidents for which we bear responsibility
since April 1985 up to the present day.

We have constructed a seamless Safety Management System that enables us to share information and solve problems in an integrated manner, from senior management through to currently
operational divisions. If a problem should arise, all of the divisions discuss it and work together
to speedily resolve it.

Hankyu Corporation
Positions and roles

Safety Management System• President
The President determines the implementation, the management organisation, and therules of the railway business and when formulating the Medium-Term Management Plan,
which includes facilities and transportation, factors, investment, and budget, the President
verifies and ascertains the situation from the perspectives of safety and feasibility andinstructs on improvements.

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

Manager, Urban
Transportation Planning(Head of Investment
and Financing Team)Manager,
Transport Division(Chief Train Operations
Manager)Manager,
Technical Division(Chief Civil Engineering
Facilities Manager)

Manager,
Kobe LineOperations

Manager,
Takarazuka LineOperations

Manager,
Kyoto LineOperations

Deputy Operations
Manager(Crew Training Manager)

Deputy Operations
Manager(Crew Training Manager)

Deputy Operations
Manager(Crew Training Manager)

Manager,
Technical Division(Chief Electrical
Facilities Manager)

Manager,
Technical Division(Chief Rolling StockManager)• Chief Safety Manager
In order to prioritise securing the safety of railway facilities and rolling stock and 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 toensure compliance with related laws and ordinances; to increase awareness of safety as
the Group’s most important priority; 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 Train Operations Manager
The Chief Train Operations Manager manages operations-related duties, including utilising
the employees involved in operations, railway facilities, and rolling stock; setting andrevising the operations plan; managing train crews, the operations of rolling stock, and train
operations; and providing training for train crews and maintaining their capabilities.
• Chief Crew Training Manager
Based on the instruction and orders of the Chief Train Operations Manager, the Chief Crew
Training Manager maintains and manages the capabilities of train crew and periodicallyconfirms and submits reports on the progress being made in improving their capabilities.
• Other managers and responsible persons
In each division, other managers and responsible persons maintain and manage thefacilities they are responsible for in order to ensure there are no obstacles to realising safe
transportation.

The Safety Management Promotion Committees

The safety management promotion committees discuss, investigate,
and report on a variety of proposals for transportation safety man-Group Safety Management
Promotion Committee

agement. The safety management promotion committees include

Business Division
Safety Management
Promotion Committee

the President serves as chairperson; the Business Division Safety

Investigative Committee for
Measures to Prevent Accidents

Technical Division
Technical Division
Transport Division(electrical facilities)(civil engineering facilities)
Safety Management
Safety Management
Safety Management
Promotion Committee Promotion Committee Promotion Committee

Manager serves as chairperson; and the divisional safety management
promotion committees.

Revisions to the Railway Business Law in October 2006 required railway companies to create new safety management systems dedicated totransport safety. Under our new safety management system, we are realising even higher levels of safety by applying the PDCA cycle, ensuring
compliance with all related laws and regulations, conducting operations that place the highest priority on safety, and fostering greater awarenessof safety issues among employees from directors down.

Technical Division(rolling stock)
Safety Management
Promotion Committee

DO
Safety management
implementationand operation

Hanshin Electric Railway
Positions and roles

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

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

President
Directors
Urban Transportation
Business
Railway Safety Council
Chief Safety Manager(Head of Urban
Transportation Business)• Chief Safety Manager (Head of Urban Transportation Business)
The Chief Safety Manager is responsible for overseeing all activities related to ensuringtransport safety.
• Chief Train Operations Manager (Deputy Head of Urban Transportation 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 traincrews, 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 Crew Training Manager (the heads of the East Rolling Stock Yard 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.

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

Manager,
Electrical Division

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

the Group Safety Management Promotion Committee, on which
Management Promotion Committee, on which the Chief Safety

Investigative Committee
to Improve the Safety andSecurity of Operations

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

Manager,
Rolling Stock
DivisionManager,Engineering
Division

Chief Crew Training Manager * Previously, the manager of the Transport Division served as theChief Train Operations Manager. Following the establishment(Head, East Rolling Stock Yard)of the Deputy Head of the Urban Transportation Business,(Head, West Rolling Stock Yard)
however, the Deputy Head serves as the Chief Train Operations
Manager from fiscal 2014 onward.

COLUMN

Toward realisingcontinuous improvements
Implementation of a management review*by the President in Hanshin Electric Railway• 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 and construction facilities.

In Hanshin Electric Railway, the Railway Safety Council is the meeting
utilised for investigating, determining, and instructing on safety-related
items. It is composed of senior management in the Urban Transportation
Business, (below the Chief Safety Manager, the Chief Train Operations
Manager, each railway division manager [Transport Division, Electrical
Division, Rolling Stock Division, Engineering Division], etc.) and in principle meets twice a month. Under this system, previously, the results of
the implementation of safety policy were reported to the President by
the Chief Safety Manager (Head of Urban Transportation Business) in a

PLAN
Creation of safety control
plans and systems

Continuous
improvement

CHECK
Safety management
and operational checks

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

management review and a venue had not been established in which the
managers of each division in the Urban Transportation Business reported
to the President. But from fiscal 2013, when there is to be reporting on the
results of the implementation of safety policy, the President attends theRailway Safety Council and each division manager reports directly to him.
In this way, the President is provided with a detailed report on the resultsof the initiatives carried out by each division, and in addition, the President
can communicate his instructions to each division more appropriately.

The 2013 safety policy
management review** A management review corresponds
to A in the PDCA cycle and it is anactivity to appropriately manage
the Safety Management System, toconfirm that it is functioning effectively, and to review and improve it
if necessary.

Implementation andoperation of safety management

Hankyu Corporation and Hanshin Electric Railway are proactively implementing initiatives
on both the infrastructure side, such as at facilities to ensure trains operate safely, and on the
personnel side, including employee education and drills.

Initiatives for natural disasters

Measures to improve safety on platforms

1 Measures to prevent people from falling from platforms onto tracks■ Installing yellow warning-line tiles
Yellow warning-line tiles add bumps to the usual warning lines and they can

1 Responding to rain storms

be felt through the shoe and indicate to the person which side of the plat-

Operational instructions are given based on the information obtained from the rain gauges, windcompleted the installation of yellow warning-line tiles at all their stations.

form is safe. In fiscal 2013, Hankyu Corporation and Hanshin Electric Railway

gauges, and water metres that we have installed along the railway lines of both Hankyu Corporationand Hanshin Electric Railway, and also on the meteorological information acquired from the Japan
Meteorological Agency. This includes instructing trains to lower their speeds or suspend operations.
Moreover, since fiscal 2014, Hankyu Corporation has been utilising information from a private-sector
meteorological information company and working to respond as much as possible to heavy rainfalls
that occur suddenly and over an extremely narrow range, such as the so-called guerrilla rainstorms.

2 Responding to earthquakes■D evices to prevent people falling in train transition areas(outside hood)
We have installed fall-prevention devices (outside hood) in the transition
spaces between trains and platforms to prevent people from falling intothem.

To further enhance the safety of train operations when an earthquake occurs,
we have installed systems for receiving earthquake early warnings fromthe Japan Meteorological Agency. In the event that such a warning is foran earthquake expected to be of seismic intensity of four or above, trainsthat operate in earthquake zones will immediately prepare for emergency
stopping. In addition, the same measure is taken when an earthquake ofseismic intensity of four or above is detected by the seismographs that wehave independently installed alongside the railway lines of both companies.

2 Measures to prevent accidents when people fall from platforms■ Emergency alert devices
When somebody or something falls onto the track, the event is detected by
special mats under the platform edge, or an emergency stop button on theplatform can be pressed. These set off alarm indicators and an emergency
buzzer for crews and station staff, in order to prevent serious accidents.
Hanshin Electric Railway completed the installation of emergency stop but-

Safety measures for rolling stock

tons at all stations in fiscal 2012, while Hankyu Corporation plans to complete
their installation at all stations by the end of fiscal 2016.

1 Installation of emergency alert devices and emergency call devices
In case a person suddenly becomes ill or there is an emergency situation in one of the passenger cars,
we have installed emergency alert devices in the rolling stock of Hankyu Corporation and Hanshin
Electric Railway so that customers can notify a member of the train crew. In addition to this, we aresequentially installing emergency call devices that enable customers to talk to train crew through aninterphone.

■ Platform evacuation steps

2 Equipment recording trains’ operation conditions

For when a customer falls onto the tracks and it is difficult for them to find

We install data recording equipment to record data such as train speeds and brake-use conditions
that would be useful in determining the causes of an accident should one involving rolling stock
occur, and also in preventing such accidents from occurring again. At Hanshin Electric Railway, thisequipment has been installed in all rolling stock (in the driver’s cabs), and in Hankyu Corporation, work
is underway to install it in all rolling stock.

a shelter below the platform, we have installed platform evacuation steps(ladder type and bar type) at constant intervals to enable them to climb backon to the platform.

Features of the ATS (Automatic Train Stop)

Implementation of practical drills to prepare for emergency situations

ATS equipment automatically slows down or stops trains
when drivers fail to notice or respond to, or misinterpretsignals or signalled speed limits. Hankyu Corporation andHanshin Electric Railway both use continuous speed-

Hankyu Corporation and Hanshin Electric Railway both conduct specific drills in their train operations, civil engineering (workshop) facilities,
electrical facilities, and rolling stock divisions, as well as drills to prepare for specific emergency situations. Both companies also hold joint drills forContinuous speed-checking type ATS system:

Hankyu Corporation’s continuous
speed-checking ATS systememergency situations where cooperation across business divisions is required.

checking type ATS systems on all their lines*, including
branch lines, ensuring a high level of safety.
In an effort to further improve safety, Hankyu
Corporation has been adding a new pattern control system

Under

Descriptions of Hankyu Corporation drills

115km/hUnder

Train speed

70km/hUnder

50km/hUnder

to its existing ATS equipment. This new control system isaimed at preventing overrun into level crossings, failure tostop at designated stations, and collisions in which a train

30km/hUnder

ProceedsignalCautionsignal20km/hStopsignalruns into the end block of lines. This system is already inoperation on rail lines.
Control point

Both companies are also working to improve safety byControl point
Fiscal 2014 joint drills conducted across business divisions

installing ATS equipment on sharp curves and branches inlines to prevent derailments caused by excessive speed.
In March 2011, Hankyu Corporation finished compilation

Descriptions of Hanshin Electric Railway drillsof independent safety standards stricter than those of the
Ministry of Land, Infrastructure, Transport and Tourism. In
May 2011, Hanshin Electric Railway completed installation of
ATS facilities at all 28 junctions on its network.
Hankyu Corporation is planning to introduce a safety

Obstruction signal

ATS pickup

system enabling automatic braking of rolling stock using
ATS, even if the driver misses a ‘stop’ shunting signal in a train
depot. This measure is intended to avoid damage to points
if a train jumps a ‘stop’ light, as happened at Nishinomiya

Tsunami Evacuation Guidance Drills

depot on the Kobe Line in June 2012. This system is alreadybeing used at the Nishinomiya depot and installation work iscurrently underway at the Shojaku and Katsura depots.

ATS indicator in driver’s cab

Speedometer in driver’s cab* B etween Sakuragawa and Osaka-Namba stations on the Hanshin Namba
Line, Hanshin Electric Railway relies on an onboard control-point continuous
speed-checking type ATS system that Kintetsu Corporation employs.

Inspections by senior management of field work divisions and exchanges of opinions
Senior management, including the President and the Headof Urban Transportation Business (Chief Safety Manager)
inspect field work divisions, confirm and ascertain the conditions at each facility and for each work duty, and moreover
talk directly to the employees at workplaces and strive toimprove communication with them.

Alcohol checks
All employees that are involved in train operations, including
drivers and supervisors, use an alcohol checker during the workroll-call prior to boarding trains to confirm that they are notunder the influence of alcohol. Also, superintendents carry out
face-to-face inspections at roll calls to confirm the health statusof employees.

Joint drills at the Daimotsu Training Centre

Training employees who value safety and comfort

Acquiring a service care-fitters qualification
Hanshin Electric Railway’s goal is to cultivate in its employees at all its work sites a spirit of hospitality and for them to acquire the skills to appropriately assist the elderly and people with disabilities.
Toward this, it aims for all station employees to acquire the service care-fitters qualification and tofurther improve the hospitality they show to customers. Qualified staff where a “service care-fitter”
name tag so that customers know they possess this qualification.

Training School and Staff Training Centre
Hankyu Corporation and Hanshin Electric Railway have established a training school (certified by
the Ministry of Land, Infrastructure and Transport) to train drivers, conductors, and assistants, and in
addition, Hankyu Corporation has set up a staff training centre to improve the services provided tocustomers by station staff.

Activities to raise awareness of safety at elementary schools along our railway lines
Hankyu Corporation employees visit the elementary schools located along its railway lines to raise thechildren’s awareness about safety. This includes explaining to them how a railroad crossing works andthe correct way to cross it, the things that they should pay attention to when they are waiting for a
train on a platform, and manners in the train.

Our mission is to work with our customers and the people who live in the communities
alongside our railway lines to build a better society. Going forwards, we will continue to focus
our energies into measures to improve safety in cooperation with the people who live alongside
our railway lines and in our local communities, including through drills with the police and firestations and by raising awareness of safety in elementary schools.

Other Risks and Countermeasures
The following is the Group’s perspective provided in response to questions received from our investors in relation to the risks
attendant on our business. Information about future events that appears in this report was determined by the Group to be current asof 31st March 2014 and is not intended to negate the possibility of these risks impacting the business performance, financial positionand other aspects of operations of the Group.

Economic Environment-related Risks
Changes in the Financial Market
Despite increases in the interest rate set by the Bank of Japan andthe difficulties associated with market-based financing accompanying changes in financial markets, the Group limits its exposure
to risk associated with interest rate increases by prioritising theundertaking of long-term loans with fixed interest rates. In addition,
the Group secures financing by working to establish back-up lines
based on commitment lines set up with correspondent financial
institutions.
Nevertheless, in the event that financial markets were tochange dramatically, the business performance and financial position of the Group could be adversely affected.

Foreign Currency Market Fluctuations
The Group assumes that sudden fluctuations in foreign currency
markets will occur as economic conditions change. However,foreign exchange rate contracts, currency swap contracts and currency option contracts are employed to avoid the exchange rate
fluctuation risks attendant on some foreign currency-denominatedassets and liabilities.
Nevertheless, although foreign currency market fluctuation risk
is mitigated through the use of foreign currency exchange-related
derivative transactions, in the event that sudden fluctuations
exceed assumptions, the business performance and financial position of the Group could be adversely affected.
The Group’s overseas sales constitute less than 10% of its consolidated operating revenues.

Business-related Risks
Demographic Change
Due to the aging population, it is expected that capital expenditureon safety measures and construction aimed at making facilities
barrier-free will increase. At the same time, due to future population decline caused by the falling birth rate, it is possible thattransportation demand (for the Group’s railways, buses and taxis)
will recede, and that demand in other businesses may also decline.
In order to respond to this challenge, the Group is working
with government and educational institutions on communitybuilding initiatives with a focus on peace of mind, education andcultural enrichment. By doing so, we are working to enhance theappeal of the areas served by our stations so as to ensure that ourrailway lines enjoy the patronage of large numbers of people.

Safety Management
In the Group’s core railway business, our passengers would suffer
greatly if an accident were to occur. We are keenly aware of the
responsibility entrusted to us for our passengers’ lives. Therefore,
the cornerstone of our business is placing the utmost priority on
ensuring the safety of customers.
Accordingly, the Group has upgraded all aspects of its safety
capabilities in the conviction that putting passengers first andprioritising safety come above all else. We are engaged in a wide
variety of endeavours for ensuring that we go one step further tooffer our passengers even safer transportation.
(For safety measures in our railway business, please refer to Page
67.)

Risks Associated with Power Supply
Shortages and Electric Utility Rates
In the event of a shortage of power supply, train and other services
may be disrupted. In addition, increases in electric utility rates
are a factor driving up power and other costs. In order to curb
power usage to the maximum extent possible while minimising its
impact on earnings and expenses, the Group is undertaking suchmeasures as gradually introducing energy-saving equipment andstrengthening cost reduction awareness among employees.

Damage to the trust regarding the quality
and safety of our products and services,
as well as the displaying of them
The Group’s performance may deteriorate due primarily to adecrease in revenues in the event of damage to the trust in thequality and safety of our products and services as well as the displaying of them.
The Group confirms that all relevant laws and regulations arebeing complied with and carries out checks of quality, sanitation
management, and food labeling. It also strives to ensure the quality
and safety of its products and services and that the correct information is displayed.

Natural Disasters and Acts of Terrorism
The Group’s businesses and transportation network infrastructure
could be significantly damaged by natural disasters such as earthquakes, typhoons and floods or acts of terrorism.
Hankyu Corporation and Hanshin Electric Railway Co., Ltd. haveinstalled rain, wind and river water gauges in the areas along ourrailway lines for collecting observation data. We also use real-time
information provided by meteorological observatories to ensure
the safe operation of our trains. If an earthquake of JMA seismic
intensity 4 or above is detected by a seismograph or predicted byan earthquake early warning system, all trains that operate in thezone in question will immediately prepare for emergency stopping.
For possible acts of terrorism, or where suspicious items or persons
are identified or damage has occurred, we have risk-graded management response systems.
We have also developed emergency response systems forminimising the social impact in the unlikely event of an incident
which causes long-term disruption to transit services or results in agreat number of casualties.

Infectious Disease Outbreaks andEpidemics
Group businesses could be significantly affected if economic activities were restricted or customers refrained from going out due
to an outbreak or epidemic of an infectious disease such as SARS
(Severe Acute Respiratory System) or H1N1 flu.
In response to the spread of infectious diseases such as H1N1
flu, the Group has developed a Business Continuity Plan (BCP) for
each division, under the direction of core companies. During the
H1N1 outbreak in 2009 and 2010, ongoing surveys into infection
rates among employees and their families in each division gave us
a good idea of the scale of risk, minimising the impact of H1N1 on
our business. Also, in the railway business, which is a particularly
important part of the social infrastructure, we drew up plans inadvance to minimise the impact of any explosive spread of the disease, including multiple schedules assuming a shortage of railway
staff.