FLY INTO TOMORROWJAL REPORT 2021
The fiscal year ended March 31, 2021

Foreword

JAL Group Corporate Policy

Table of Contents

Message from the President

The JAL Group adopts the Corporate Policy as its universal management goal andmanagement rationale, and established the Safety Charter as the Group’s safety policy
based on the Corporate Policy.

Safety: The protection of lives.

To accomplish this, we will act according to the following

This is the commitment and basic foundation

principles.

of business continuity for the JAL Group.
We take to heart our mission andresponsibility as safety professionals to ensure

expected of all Group employees, with the hope that application of this Philosophy willa safe operation on every flight with the bestlead to realization of the Corporate Policy.

of our knowledge, skills and abilities.

· Stop immediately when safety concern arises.
· Comply with rules and strictly follow standard operating procedures.
· Always check and confirm; never rely on assumptions.
· Promptly communicate information without omission to ensure
safety.
· Deal with problems quickly and appropriately without
underestimation.

The JAL Group Value Creation Story

The JAL Group also established the JAL Philosophy as a mindset, values and attitude

Foreword

Safety Charter

JAL Philosophy

The JAL Group Will:of all our employees;- Deliver unparalleled service to our customers;- I ncrease corporate value and contribute to thebetterment of society.

Part 2 To Become a Wonderful JAL

Chapter 1 The Formula for Success(The Formula for Life and Work)

Chapter 1 Each of Us Makes JAL What It Is

The Result of Life and Work
= Attitude × Effort × Ability

Chapter 2 Have the Right Attitude
Base Criteria for Decision-Making on“Doing What Is Right as a Human Being”
Have a Beautiful Mind
Be Humble and Honest
Always Be Cheerful and Positive
A Small Good Is Like a Great Evil, While aGreat Good May Appear MercilessWrestle in the Center of the Ring
Grasp Matters Simply
Possess Opposing Extremes

Chapter 3	Accumulate Tedious Efforts with Passion
Work Earnestly
Accumulate Tedious Efforts
Work with Voluntary Attention
Fire Yourself Up
Strive for Perfection

Chapter 4 Ability Will Improve

Chapter 2 Have a Keen Sense of Profitability
Maximize Revenues and Minimize Expenses
Elevate Our Cost-Consciousness
Pursue Profit Fairly
Manage the Company Based on Accurate Figures

Chapter 3 Unite Our Hearts
Make the Best Baton Pass
Align Mental Vectors“Workfloor” Management
Follow the Merit System

Chapter 4 Possess a Fighting Spirit
Maintain an Ardent Desire
Never Give Up Until We Succeed
Boast and Make It Come True
Possess True Courage

Data Book

Ability Will Improve

Each of Us Makes JAL What It Is
Discuss Frankly
Lead by Example
Be the Center of the Vortex
Valuable Lives Are Entrusted to Us in Our WorkBe Thankful
Put Yourself in the Customer’s Position

Medium Term Management Plan

Pursue the material and intellectual growthPart 1 In Order to Lead a Wonderful Life

Chapter 5 Be Creative in Our Work
Today Should Be Better Than Yesterday, Tomorrow
Better Than Today
Conceive Optimistically, Plan Pessimistically, andExecute OptimisticallyThink Through to Visualize the Results
Decide and Act with Speed
Face Challenges with Courage
Aim High

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JAL REPORT 2021

JAL REPORT 20212

Foreword

JAL Group Corporate Policy

Table of Contents

Message from the President

JAL Group Information System

Editorial Policy

In addition to this report, detailed information is available on our corporate website and various
booklets for stakeholders.
JAL REPORT 2021

Chapter 2: Medium Term Management Plan

P.5
P.11

The Value Creation Process

P.13

70 Years of Challenge andInnovation

P.15

JAL Group’s Strengths

P.16

Foundation for Value Creation

P.21

Corporate Governance

Scope of the report
This report covers 131 JAL Group companies, comprising Japan
Airlines Co., Ltd., 79 subsidiaries and 51 affiliates.

The following detailed information is also
posted on the JAL corporate website.

the foundation for corporate valueenhancement over the medium- to long-term.

Reference guidelines
The International Integrated Reporting Framework issued
by the International Integrated Reporting Council (IIRC) and
the Guidance for Collaborative Value Creation issued by the
Ministry of Economy, Trade and Industry were used as referencein preparing this report. The GRI Standard issued by the
Global Reporting Initiative (GRI) was used as reference for ESG
information.

P.36

Environmental Awareness

P.37

Strategic Overview

P.38

Timeline
Management Targets

Air Passenger Business
Cargo and Mail Business
Mileage, Lifestyle and Infrastructure Business
Safety and Comfort
Human Resources Strategy
Digital and IT Strategy
Finance Strategy
Rebuilding the Financial Foundation
Shareholder Returns and Growth Investment
Cost Management
Investment Strategy
ESG Strategy
Environment
PeopleCommunities
Governance

43
51
53
59
61
63
65
66
67
68
69
71
75
87
97
103

P.40

Business Strategy

P.61

Human Resources Strategy

P.63

Digital and IT Strategy

The growth strategies
for each business.

The human resource and intellectual
property strategies
that are the essential to increasing
corporate value.

Date of publication
September 2021

JAL corporate website

P.65

Finance Strategy

www.jal.com/en/

Offers a comprehensive insight into JAL Group’s businessapproach, activities in general, IR (Investor Relations)information and sustainability information.
Regarding statements about the future outlook
This report includes statements about the future outlook of JAL Groupbusinesses and forecasts. These statements reflect current JAL Groupanalysis related to existing information and various trends. Actual results
may differ from the forecasts due to business risks and uncertainties.
Regarding products, services, events, etc.
Some of the products, services, events, etc. contained in this report havebeen suspended due to extenuating circumstances.
For the latest information, please refer to sources such as JAL corporatewebsite.
Regarding the photos included
In some of the photos in this report, masks are not worn however masks
were only removed for the purposes of the photograph.

P.71

ESG Strategy

・JAL Philosophy
・Company Profile
・History
・Corporate Governance・Medium Term Management Plan
・Organizational Overview
https://www.jal.com/en/outline/

・Safety Management
・Efforts to realize a safe and secure society
・Commitments to ensure outstanding quality
https://www.jal.com/en/ﬂight/

・Sustainability Management
・Integrated report/ESG Data
・Initiatives of the JAL Group’s Sustainability
・JAL Group Actions to Achieve SDGs
https://www.jal.com/en/sustainability/

The finance strategy
in the post COVID-19 era.

The initiatives
to create a sustainable future.

・About JAL Group・Stock Information
・IR Library

Data Book40

The business environment(risks and opportunities).

・JAL Group Corporate Policy

Medium Term Management Plan

Business Strategy

JAL REPORT 2021

of JAL’s competitive advantage.

The corporate governance system,

P.39

119
121
127
146
150

The strengths and foundations

Primarily April 2020 to March 2021 (FY2020)

36
36
37
38
39

Data Highlights
Business Data
Financial Data
ESG Data
Company/Stock Information

as the basis of management decisions.

Message from the PresidentManagement Strategy
Environmental Awareness
Strategic Overview
Timeline
Management Targets

Chapter 3: Data Book

3

Period covered by the report

JAL Philosophy

JAL corporate website

Corporate Policy and management visionCorporate Policy・Company Profile

11
13
15
16
19
19
20
21

JAL Group Corporate Policy・
Safety Charter

The JAL Group Value Creation Story

The Value Creation Process
70 Years of Challenge and Innovation
JAL Group’s Strengths
Foundation for Value Creation / Safety Charter/ JAL Philosophy/ Divisional Profitability Management System/ JAL Group Code of Conduct/ Corporate Governance

P.1

Foreword

Chapter 1: The JAL Group Value Creation Story

The JAL Group has published this JAL REPORT 2021 to informstakeholders about our business activity outcomes in theprevious financial year, our strategies for the future, and toprovide an understanding of the Group’s pursuit of social value
along with economic value, and sustainable growth. This reporthas been collated from a wide range of both financial and nonfinancial information that the JAL Group has deemed to be ofparticular importance to Group management, all of which ismade available on the Group’s website.

Safety and Quality

1
3
3
4
5

JAL Group Corporate Policy
Table of Contents
Editorial Policy
JAL Group Information System
Message from the President

your information media.

Sustainability

Foreword

You can learn about…

Investor Relations

Table of Contents

・Financial Highlights
・Monthly Traffic Data
https://www.jal.com/en/investor/

P.113 Major External Ratings
Major Sustainability Initiatives
and Results to Date
P.119 Data Highlights
P.121 Business Data
P.127 Financial Data
P.146 ESG Data

Others

The indicators for measuring successof JAL’s initiatives and the results.

・JAL Group Safety Reporthttps://www.jal.com/en/ﬂight/report/
・Corporate Governance Reporthttps://www.jal.com/en/outline/governance/
・Consolidated Financial Statements
https://www.jal.com/en/investor/library/group.html
・Consolidated Financial Results
https://www.jal.com/en/investor/library/information/

JAL REPORT 2021

4

Foreword

JAL Group Corporate Policy

Table of Contents

Message from the President

We aim to be “the world’s most
preferred and valued airline group” with“Safety and Comfort” and “Sustainability”
Forewordas the engines of growth.

The JAL Group Value Creation Story

Foreword
First and foremost, I would like to express my heartfelt sympathy to those affectedby the novel coronavirus (COVID-19) and their families and my deepest respect andgratitude to all the healthcare professionals and others working to protect human
lives and bring the situation under control.
Since last year, the COVID-19 pandemic has had a tremendous impact on manyindustries including the aviation industry, and we were not an exception. Our company
is facing an extremely difficult situation, and I express my sincerest appreciation to ourcustomers and stakeholders for your tremendous support and kindness.

Medium Term Management Plan

Amid an uncertain business environment, the JAL Group formulated a new Medium
Term Management Plan in order to overcome the current crisis and make steadyprogress toward the future. We will endeavor to achieve sustainable growth anddevelopment and increase corporate value in the post COVID-19 era through theexecution of our business strategy, finance strategy and ESG strategy as the pillars ofstrategic management.

Data Book

This year marks the 70th anniversary of the foundation of the JAL Group. Given thedramatic shifts to values in these changing times brought about by the pandemic, wewill make concerted efforts to become “the world’s most preferred and valued airline
group” by leveraging the strengths we have cultivated to date with a focus on “Safety
and Comfort” and “Sustainability” as the engines of growth. We look forward to yourcontinued support and patronage.
September 2021

AKASAKA Yuji
Representative Director, President

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Foreword

JAL Group Corporate Policy

Table of Contents

Message from the President

Spearheading solutions to social issues and reforms through ESG strategy as
our strongest growth strategy
In particular, addressing climate change is a pressing
social issue for airlines, which emit huge amounts of CO2
in daily operations. With this in mind, we announced ourcommitment to achieve net zero carbon emissions by
2050 at the June 2020 General Meeting of Shareholders.

This may be too big a challenge for one airline to handle.
However, the sustainable growth of the JAL Group canonly materialize in a society and future such as this. I feelthat the pursuit of a sustainable society through businessactivities driven by ESG strategies will create new
business opportunities, and we should not miss out onthat chance.

The question is how net zero emissions can be achieved.
The answer is building a supply chain for the development
and production of environmentally-friendly alternativeand synthetic fuels through long-term cooperation withmany partners. I would like to see the JAL Group play acentral role in making big waves that swell to form new
initiatives.

The JAL Group Value Creation Story

While the movement of people posed risks in the
pandemic situation, we reaffirmed the importance ofmeeting people in person and the value of movement,
since some things cannot be done without movement.
We need to get back to a world where people and goods
can move safely and freely.

Advances in aviation technology have replaced four-engine
aircraft with long-haul twin-engine aircraft and nearly
halved the amount of fuel consumption over the past 30
years. Likewise, continued efforts by manufacturers andairlines to develop cutting-edge aircraft through further
technological advances should lead to huge reductions infuel consumption and carbon emissions.

Foreword

Driven by this strong aspiration, we announced“JAL Vision 2030,” which defines where the JAL Groupwants to be in 2030, and set the goals of creating“a safe and secure society” and “a sustainable future”
in the Medium Term Management Plan, which wasannounced in May.

Medium Term Management Plan

Facing dramatic environmental shifts without precedent

On the other hand, I was sure the pandemic would
generate far-reaching and unprecedented changes
in the environment. Experiencing the pandemic, a crisis
that confronted humanity, has sharpened awarenessof global social issues such as risk exposure and theSDGs and has increased momentum to address theseissues head-on. Furthermore, the acceleration of digital

7

JAL REPORT 2021

transformation is drastically changing private lives and weare bound to see huge changes in society in the future.
Based on these perceptions of the business environment,
I strongly felt a sense of crisis that we will fall behind thetimes if conventional thinking remained unchanged. To
overcome the current crisis and facing the urgent need to
implement financial and business structure reforms,
we have redefined the vision of what the JAL Groupaspires to be in the future.
The JAL Group’s reason for being is to contribute to
the betterment and development of society through airtransportation as social infrastructure and a community
lifeline. This stance has not and will not change. I feel that
it is our responsibility and mission to spearhead solutions
to social issues and reforms and to stand at theforefront of driving initiatives in the coming era. For thispurpose, we have set goals that are appropriate for this.

The JAL Group will focus on the key themes of “Safety and Comfort” and “Sustainability”
as growth engines; amid a time of upheaval with drastic changes in values toward travel.

Safety and Comfort

Realize a safe, secure,and reliable society
in a comfortableenvironmentJAL
Vision2030

Sustainability

Realize an affluent society
where each one of us

Data Book

Fiscal 2020 was a turbulent year of rapid changes
in the business environment brought about by the
spread of COVID-19. We were forced to steer throughdifficult waters in maintaining essential air transport
networks and transporting healthcare workers andmedical supplies, while reducing flights to the extent
possible to control the movement of people. We also did
everything possible to stop negative cash flows andensure employment security to all our employees
through intensive cost reduction and investment control.

can sense and hopefor a brighter future

To become the world’s most preferred and valued airline group,
where many people and goods lively move around.

JAL REPORT 2021

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Foreword

JAL Group Corporate Policy

Table of Contents

Message from the President

A safe and secure society and a sustainable future created by diverse humanresources
With this strength, I am confident that we can take thelead in finding solutions to social issues and promoting
reforms, and contribute to the betterment anddevelopment of society. I will provide opportunities forevery employee to demonstrate their abilities, give wordsof encouragement, “You can do it, let’s do it together,”and together, take on new challenges.

The JAL Group Value Creation Story
Foreword

The JAL Group will continue to move forward to become“the world’s most preferred and valued airline
group” of all our stakeholders.
We look forward to your continued support andpatronage.

The JAL Group Value Creation Story

Originally, air transportation developed with a spirit ofchallenge to open uncharted routes. Given the major
unprecedented changes in the business environment, now
is the time to apply the spirit of challenge we inheritedfrom our predecessors and the strengths we havedeveloped over the years, that is, our human resource
base, customer base and financial base. In particular, ourhuman resources are our greatest assets. Our diverse
workforce, including the young generation of the
future and female employees, will drive initiatives
toward “JAL Vision 2030.” Even amidst large-scale flight
reductions and suspensions due to the pandemic, we saw
every one of our 36,000 employees voluntarily do “whatwe can do now,” which reaffirmed my belief in theunderlying strength of our human resources.

01

Medium Term Management Plan
Data Book

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JAL REPORT 2021

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Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

The Value Creation Process
The JAL Group aims to contribute to the betterment and development of society as set forth in the Corporate Policy, andcreate social value along with economic value through business activities utilizing our management resources, with safety
as the basic foundation of business continuity. We will base our actions on the JAL Philosophy, the divisional profitability
management system, the JAL Group Code of Conduct “Commitment to Society” and corporate governance.

INPUTOUTPUT

JAL Group Businesses and Strategies(Key Management Resources)

Human capital

Networks connecting regional areas in Japan andthe world• JAL Group airlines, oneworld alliance, etc.
Cities serviced: 413• Collaboration with regional communities in Japan→ P.40Wide customer base→ P.65→ P.71→ P.59→ P.45

Realize a safe, secure,

Comfort→ P.60

Low Cost Carrier(LCC)

and reliable society
in a comfortable→ P.49Cargo andMailenvironment
Finance→ P.51

Mileage, Lifestyleand Infrastructure→ P.53

JAL
Vision2030

EBIT (Earnings Before
Interest and Taxes) Margin → P.67
ROIC (Return On
Invested Capital) → P.67
EPS (Earnings → P.67
Per Share)

Production capitalGroupmanagement

Aircraft and serviced airports• JAL Group aircraft: 16 aircraft types, 237 aircraft• Domestic and international airports: 96

Sustainability
Sustainability

Financial capital

Realize an affluent society

Foundation for Value Creation

A strong financial base

• Equity: 947.4 billion yen • Equity ratio: 45.0%
Natural capital

JAL
Philosophy→ P.16→ P.19→ P.19Corporate Governance• Energy sources such as aviation fuel• Tourism resources, materials, and merchandise generated from a richnatural environment and biodiversity

Airline Industry / JAL

MarketSociety

Severe damage on business

Structural changes in air travel
and consumer behavior

Growing social awareness toachieve the SDGs

JAL Group
Code of Conduct“Commitment to Society”

where each one of us

Environment → P.75
Peoplecan sense and hope

→ P.87→ P.20for a brighter future

Communities → P.97

→ P.21

Data Book

Finite resources

Safety Charter

Divisional
Profitability
Management System

Medium Term Management Plan

• JAL Mileage Bank members: approx. 30 million• JAL Card members: approx. 3.6 million

Safety and Comfort

SafetyThe JAL Group Value Creation Story

Social capital

Full Service Carrier(FSC)

Foreword• Regulations and manuals • IT systems (e.g. enterprise systems)• Open innovation (JAL Innovation Platform)

ESG (Environment, Social &Governance) strategy

Accumulated expertise

Finance strategy

Intellectual capital

Digital and IT strategy

Human Resource strategy

Business strategy• Consolidated employees: 36,060• Percentage of men: 48.3%, Percentage of women: 51.7%• Total hours spent on drills and training per person: 277.1

Air travel demand in 2020: reduced byapprox. 70% (YoY)*（JAL Vision）

SafetyandComfortDiverse and professional human resources

Changes in the businessenvironment

OUTCOME(Management Targets)

Stakeholders
Customers

Regional
communities

Business
partners

Administration

Shareholders

Employees* vs 2019: Statistics of IATA (International Air
Transport Association)

11

JAL REPORT 2021

JAL REPORT 2021

12

Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

70 Years of Challenge and Innovation
This year marked the 70th anniversary of the foundation of the JAL Group. We would like to reflect on our history from the foundingof the company as the first post-war private airline in Japan to the present, together with episodes of challenge and innovation.

Leaping into the age of mass transportation
through the establishment of a flight
operation system and management base

Growing into one of the world’s leading
airlines and driving globalization

1980 ‒ 2000s

2010 ‒ Present

JAL started business by borrowing aircraft from another airline andoutsourcing operations and maintenance, but we eventually realized
our dream of independent operations with our own aircraft andexpanded our route network.

With the liberalization and deregulation in the aviation sector, weentered an era of intensifying competition. We grew into a global
airline by improving quality and differentiating ourselves from otherairlines.

After JAL went into bankruptcy in January 2010, we achieved revitalization through business optimization
and awareness reform. Now that we face an unprecedented crisis due to the COVID-19 pandemic, we will
utilize the strengths we have cultivated through history to overcome it and strive to realize “JAL Vision 2030”
through the combined efforts of all our employees.

1987: Full privatization
2002: Merger of Japan Airlines and Japan Air System
Establishes the Corporate Policy, Safety Charter,
Code of Conduct

2010: Files petitions for reorganization proceedings
Reorganizes route network and withdraws fromfreighter business2011: Establishes a new Corporate Policy and the
JAL Philosophy
Introduces the divisional profitability
management system and returns to the
Tsurumaru logo

The second Tsurumaru logo

The third Tsurumaru logo

1951: Founding of Japan Airlines(former company)
1959: Birth of the Tsurumaru(Japanese crane) logo

2012: Relists on the Tokyo Stock Exchange
Enacts the Fundamental Policies ofCorporate Governance
2019: Revises the Safety Charter and enacts a new
Code of Conduct
2021: Establishes “JAL Vision 2030”

Safety and Comfort

Realize a safe, secure,and reliable society
in a comfortableenvironmentJAL
Vision2030

Sustainability

Realize an affluent society
where each one of us
can sense and hopefor a brighter future■ Route Network and Partnership

Cumulative total
1.5 billion people

1983: Records the world’s top passenger and cargotraffic according to International Air Transport
Association (IATA) statistics (for five consecutive
years until 1987)
2007: Joins the oneworld alliance

1952: Starts domestic independent operations
1954: Opens the first international flight on theTokyo-Honolulu-San Francisco route
1967: Opens the round-the-world route

1982: Issues JALCARD
1993: Launches a mileage program
2004: Introduces Class J, a top tier class of service on
domestic flights

Business Activities■ Aircraft■ Safety

1975: Launches the JAL Scholarship Program forstudents from the Asia-Oceania region
Cumulative passenger traffic(total on international anddomestic flights)

1951

13

JAL REPORT 2021

2013: Introduces a new international seat “SKY SUITE”
2017: Renews passenger service system (PSS)

1995

2018: Receives 5-star rating in SKYTRAX World Airline Star
Rating2020: Launches JAL SMART AIRPORT with redesigned airport
facilities■ Aircraft

2002: Begins revamp of
reinforced cockpit doors
Cumulative total
2004: Acquires IOSA (IATA
500 million people
Operational Safety Audit)
certification
2006: Establishes the Safety Promotion Center
Introduces Safety Management System (SMS)
2007: Starts new precision navigation (RNAV) operations

2012: Starts Boeing 787 operations■ Safety
2016: Begins aircraft fault prediction using big data

1984: Launches the CONTRAIL Project of
atmospheric observations (regularized in 2005)
1993: Opens the Priority Guest Center
Cumulative total 2009: Operates the world’s first test flight using
100 million people
biojet fuel1977

2011: Establishes Jetstar Japan in collaboration with Qantas
Group of Australia
2018: Establishes an international medium- to long-haul LCC(ZIPAIR Tokyo)
2021: Makes Spring Airlines Japan a consolidated subsidiary

2019: Starts Airbus A350 operations
Data Book

1970: Commences installation of inertial navigation system (INS)for long-haul flights
Installs metal detectors at domestic airports to strengthen
aviation security
1974: Releases flight information management system “JALFOS”
1978: Installs ground proximity warning system (GPWS) on all aircraft
1997: Completes installation of anti-collision warning system(TCAS) on all aircraft

・Expansion of LCC business2011: American Airlines (American routes)
2012: British Airways (European routes)
2014: Finnair (European routes)
2016: Iberia Airlines (European routes)
2020: Malaysia Airlines (Southeast Asia routes)■ Products and Services, and Customer Base

2004: Starts operations of the
Boeing 777-300 ER.
Participated in development
as a launch customer.

1970: Starts operations of the
Boeing 747 (jumbo jet)

■ ESG

Cumulative total
1 billion people

・Promotion of joint business in major markets

Medium Term Management Plan

■ Route Network and Partnership■ Products and Services, and Customer Base
1965: Launches sales of JALPAK, Japan’s first overseas
package tours
1970: Establishes JAL Global Club (JGC), a frequent flyer
membership club

The JAL Group Value Creation Story

The first Tsurumaru logo

Foreword

1951 ‒ 1970s

Management in General

To become “the world’s most preferred and valued airline group”

2006

2019: Expands and improves Employee Wellness Program
2020: Co-develops a mechanism to minimize the impact of
turbulence.

■ ESG
2010: Certified as an Eco-First company
2011: Launches regional revitalization project “JAPAN PROJECT”

2020: Announces net zero CO2 emissions by 2050

2021
JAL REPORT 2021

14

Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

JAL Group’s Strengths

Foundation for Value Creation/Safety Charter

Three strengths cultivated through 70 years of history

Basic Stance on Safety
Safety Charter

70 Years of Challenge and Innovation

Contributing to the Progress and Development ofSociety through Air Transport

Offer the finest service
and accumulate
experience×

Lessons andLearning×

All employees learn andpass on lessons from
accidents and incidents

Challenge andInnovation
We make steady efforts
and create innovations
to attain high goals.

Human resource base

Customer baseFinancial base

Safety Management System
We have established a safety management system (SMS), which is a systematic framework including the organizational
structure, responsibilities, policies, and operational procedures necessary for safety management.
■PDCA Cycle of the Safety Management System
Management

Plan

Action Check

Plan

15

JAL REPORT 2021

Customer base refers to everything
related to customers such as our mileage
program, membership organizations,data accumulated over the years andrelationships with customers who haveused the JAL Group to date. The JAL
Mileage Bank has more than 30 million
members. We aim to improve customer
satisfaction and preference and attracteven more customers by reviewing
problems identified through assessments
and customer feedback and by making
improvements each day.

Financial baseFinancial base collectively refers to thefinancial position of the JAL Group, strictfinancial discipline on resource allocationand cost management, communication
with our stakeholders, and otherfinancial matters. After our bankruptcy
in 2010, we have built a solid financialbase, which stands out amongst global
airlines, through steady and soundmanagement focused on profitability
rather than size. Despite the financial
damage caused by COVID-19, we havemaintained a sound financial position,
enabling stable business operations.

Plan

Do

Action Check
Corporate Safety andSecurity Division[Risk Management and Corrective Action]
Safety is maintained by accurately grasping the actual status of daily operations, monitoring the SMS based on information
on incidents and other data, and continuously implementing necessary improvements. In order to grasp the actual status,
it is essential for employees to report unsafe situations that they experienced or discovered and the resulting events (“unsafe
events”). We have therefore created an environment to facilitate and encourage reporting.
Reports from employees are managed in real time in an integrated safety database, and risk assessment of each report isperformed. Necessary measures are formulated and implemented for high priority risks in order to reduce risks, using risk
assessment and human error analysis methods in the process. In addition to reports from employees, flight data recorded
during flight are analyzed to provide information for risk management.

Data Book

Human resource base is a collective
term for every employee who belongs
to the JAL Group, corporate policies, thecorporate stance and corporate culture
such as the JAL Group Corporate Policy
and the JAL Philosophy. Air transportation
requires advanced expertise and precision.
Therefore, the JAL Group has continuously
improved human skills, while accumulatingknowledge and experience in flight
operations and everyday work, andpassing on skills from veteran employees
to the next generation including lessons
learned from the past. Human resources
who practice the JAL Philosophy and act
autonomously and voluntarily are thegreatest strengths of the JAL Group.

Customer baseDo

Action Check

Divisions

Human resource baseDo

Medium Term Management Plan

[System]
Under the overall management of the General Safety
Manager, who is appointed pursuant to the Civil
Aeronautics Act, senior management executives, theCorporate Safety and Security Division, and each division
operate their respective safety management cycles,
which are organically linked, and make continuous
improvements. Management regularly reviews
achievement outcomes of safety initiatives and safetytargets, and gives necessary instructions to improve the
SMS, and the need for safety investment and resources.
· For the Safety Management Organizational Chart SMS,
click here.

The JAL Group Value Creation Story

JAL Group’s strengths

Foreword

Operations andServices

The JAL Group has established a Safety Charter based on its Corporate Policy in order to indicate in greater detail its fundamental
policy regarding safety. It clearly states, “Safety: the protection of lives,” to ensure that decisions and actions are aimed at protecting
lives with a shared awareness among all organizations that safety is the basic foundation of our business. All JAL Group staff carry a
Safety Charter Card printed with the Safety Charter and abide by it as professionals on a daily basis.

[Human Resources]
Employees are educated and trained on skills, knowledge and abilities necessary to ensure proper implementation of the
SMS. We also conduct education and activities to raise safety awareness and develop human resources to equip them withnecessary skills, knowledge and abilities.

JAL REPORT 2021

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Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

A safety culture
A safety culture is an organizational culture and a shared awareness of safety of members in an organization. Recognizingthat “Safety: the protection of lives. It is the basic foundation of business continuity for the JAL Group,” we are taking
steps to cultivate a safety culture in which every employee acts on the basic foundation of safety at all times. Safety cannot
be increased immediately by simply doing something particular. The accumulation of multifaceted efforts is needed toproactively prevent accidents. The JAL Group uses the term “safety layers” to describe its broad range of safety initiatives
and is making unwavering efforts to accumulate our safety layers.

A culture of decision-making and challenge
The JAL Group aims to achieve sustainable growth and development by adapting to the rapidly changing environment. As it isextremely important from the viewpoint of safety for employees to make decisions within their authority and responsibility, we arereviewing and improving the decision-making process to ensure smooth and prompt decision-making. These improvements will not
only accelerate decision-making but will also increase employee motivation and serve as the basis for activities to accumulate safety
layers.

The JAL Group is promoting communication and creating opportunities for employees to verbally share and convey information
face-to-face. One such activity is the Communication Leader Meeting (CLM), which has been running since 2006, where employees
across divisions meet and revitalize the organization. We also employ “verbal confirmation” as a means of interactive communication
to ensure thorough checks, and instill this practice in workplaces.

A culture of improving manuals

17

JAL REPORT 2021

Listen to talks by people
who experienced theaccident(the actual people)

Third-party Assessment
The JAL Group regularly conducts internal and external audits in accordance with requirements of theJapanese Ministry of Land, Infrastructure, Transport and Tourism and IATA in order to assess safety
management enhancement initiatives. All IATA airlines are required to pass IOSA (IATA International
Safety Audit) every two years to ensure that safety management is functioning properly. In the JAL
Group, Japan Airlines has been an IOSA registered airline since 2004, Japan Transocean Air since 2010
and J-AIR since 2016.
IOSA Certificate (Japan Airlines)

Safety Advisory GroupIn August 2005, the JAL Group requested an external panel of five experts, called the Safety Advisory
Group, to provide advice on safety issues. The members possess extensive knowledge and experience inhuman factors, failure and defect analysis, organizational operation and culture, and safety, and provide
a wide range of objective advice and recommendations on safety from an expert’s viewpoint, which weapply to Group management and safety operations.

Members
Chair: YANAGIDA Kunio
HATAMURA Yotaro
KAMATA Shinichi
HAGA Shigeru
KOMATSUBARA Akinori

JAL Group Safety Report The report describes JAL Group’s safety initiatives in an easy-to-understand manner.

Food Safety
Allergy free food

Food Safety Management

In addition to seasonal and route-specific meals, Japan Airlines
offers a wide variety of special meals available by advancereservation. In particular, we pay close attention to offering
allergy free food, which directly affects the customers’ lives,
through measures to prevent mistakes in the meals served.
In 2017, we introduced meal vouchers, which are exchanged
between customers and cabin attendants after confirming
details of their reservations. We also introduced colored paper
napkins to visually distinguish meals in order to ensure safety
and security of our in-flight meals.

A culture of thinking from the “second to third person perspective”
In order to encourage JAL Group employees to think from the customer’s perspective, we place importance on the “second to third
person perspective,” which combines the third person perspective of thinking from a specialized airline professional and the first andsecond person perspective of treating customers as if we or our family were the customer. All JAL Group employees study the “second
to third person perspective” during JAL Group Safety Seminars for New Employees and other training courses, and always reflect onwhether they are thinking and acting from this perspective in their daily work.

See aircraft debris andpersonal belongings ofthe victims(the actual object)

Meal voucher■ Hygiene management of in-flight meals and lounge meals
To provide meals that customers can enjoy safely and with peace ofmind, we conduct hygiene management of the entire process fromthe development of menus to loading of meals onto aircraft. Our
hygiene audit staff, who are knowledgeable of the international foodsafety standard FSSC22000, visit catering companies and JAL airport
lounges around the world to conduct hygiene audits. After confirming
in detail whether management standards and procedures are followed
and appropriate risk measures are taken, they provide guidance onareas for improvement and other advice. Although there is a time gap
between the preparation of meals to the time they are consumed,
food safety is maintained through temperature control, hygiene
management of workers and tableware, and various inspections.

Data Book

In the aviation industry, many protocols and regulations are linked to safety and an accurate understanding of their true meaning
is vital. All JAL Group employees always ask themselves, “Why is this procedure necessary?” to grasp its true meaning. We
have manuals to follow specific rules but also to make changes. Therefore, we have created a framework to regularly inventory
manuals qualitatively and quantitively to find room for improvement in actual practice and to make revisions in cooperation with
manufacturers.

Climb the Mt. Osutaka
Ridge to console the soulsof the accident victims(the actual place)

Medium Term Management Plan

A culture of communicating with one another

JAL Group Education on the Three Actuals Principle

The JAL Group Value Creation Story

Reporting hazards is essential to safety management. Therefore, we have introduced a voluntary reporting system to avert emerging
safety problems. Even minor human errors are reported and used to establish preventive measures. In 2007, JAL became the firstairline in Japan to introduce a non-punitive reporting policy to inform employees that they will not be punished for human errors if
the Company deems that they occurred even though every precaution was taken. In this way, we have created an environment toencourage employees to report spontaneously without hesitation.

The JAL Group conducts various education courses to study safety
in real-life situations from the viewpoint of one’s job and to raiseawareness that safety is the basic foundation of our business. In
particular, we continuously educate our employees on lessons learned
from the JAL Flight 123 accident based on the Three Actuals Principle(the actual place, the actual object, the actual people) in order to instill
the importance of safety in the depths of our minds. Activities include
climbing the Mt. Osutaka Ridge (the actual accident site), seeing
aircraft debris (the actual object) in the Safety Promotion Center, andmeeting people who experienced the accident (the actual people)
through news footage and pre-recorded video interviews.

Foreword

A culture of reporting

Developing Safety Professionals

Colored paper napkins

JAL REPORT 2021

18

Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Foundation for Value Creation/JAL Philosophy
Aligning Mental Vectors: A Human Resource Base for Growth and Development
Toward the Realization of the Corporate Policy

Align Mental Vectors

JAL Philosophy = Common Criteria

Policy to “deliver unparalleled service to our customers andcontribute to the betterment of society.”

Awareness Reform Initiatives“Commitment to Society”
The JAL Group Code of Conduct “Commitment to Society”
was established in July 2019 as a guideline for professional
behavior to be observed by all JAL Group employees. Basedon the attitude espoused in the JAL Philosophy, it is more
firmly grounded in the company’s business and activities.
The 10 principles of the United Nations Global Compact
and Charter of Corporate Behavior of Keidanren (Japan
Business Federation) were used as reference. Behavior inaccordance with “Commitment to Society” will enable all
JAL Group employees to more securely implement the JAL
Philosophy in actual practice, while further linking thesepractices to the realization of the Corporate Policy and to
the achievement of SDGs and other goals of society.

JAL Philosophy Workshop

Online workshop

JAL Group Code of Conduct(2) Prohibiting insider trading
Leader’s Workshops(held in February 2020)

4. Respect for humanrights and job satisfaction

5. Mission andresponsibility as a memberof society

6. Passing on the precious
earth to the next generation(global environment)

7. Fair business practices

JAL Philosophy

4. Respect for human rights and job satisfaction(human rights and labor)(2) Safe and comfortable work environments
5. Mission and responsibility as a member ofsociety

In fiscal 2020, we compiled a collection of practicalexamples of practicing the JAL Group Code of Conduct“Commitment to Society” in our everyday work. Throughgroup discussions and other means, every employee
thinks of what they can do from today and puts theminto action.

Medium Term Management Plan

An evolving management system(1) Contributing to regional revitalization
through our business(2) Responsibility as a company that plays a roleIts Role in Realizing the Medium Term
Management Plan
We will implement business structure reform, as stated in theMedium Term Management Plan, to improve profitability ofexisting businesses and expand into new business domains.
In order to build resilience during times of change, we willcontinuously evolve the divisional profitability management
system in order to grasp earnings of each business domain
and use proactive management techniques to restructure ourbusiness.

in social infrastructure(3) Responsibility as a corporate citizen
6. Passing on the precious earth to the next
generation (global environment)(1) Global environmental preservation initiatives(2) Disclosure of environmental information anddialogue

Data Book

JAL REPORT 2021

3. Trust with stakeholders(1) Information disclosure and dialogue

Foundation for Value Creation/
Divisional Profitability Management System

19

2. Pursuit of customer
satisfaction

3. Trust with stakeholders(1) Respecting human rights and diversity

Now in its tenth year, the divisional profitability management
system is making a major contribution to proactive Groupmanagement. In this system, each “amoeba” creates a Target and
Result Table, which lists monthly results, schedules and forecasts
in a common format. Based on this Table, Business Performance
Reporting Meetings are held each month to discuss various issues.
Previously the main focus of these meetings was analysis of thedifference between the initial plan and actual results, but currently
the focus is on creating earnings forecasts months ahead andconducting proactive management based on these forecasts.

1. Safety

2. Pursuit of customer satisfaction

The Leader’s Workshop is held once a month for Executive Officers and Vice Presidents, and twice a year for
managers with the aim to align mental vectors of leaders. By studying the role of a leader and acquiring
leadership skills to develop autonomous employees who think and act on their own and cultivate
psychological safety where employees feel accepted and respected, we would like to foster an organizational
culture where employees are motivated by their work.

 elving deeper into the divisionalD
profitability management system

Preamble

1. Safety

Leader’s Workshop

The divisional profitability management system is anautonomous management system based on “amoeba
management,” in which each amoeba, or the smallest
unit of an organization, keeps track of its earnings whilereflecting the latest market trends.

JAL Group Code of Conduct

The JAL Group Value Creation Story

The JAL Philosophy Workshop is held continuously to enable all employees to repeatedly study and practicethe JAL Philosophy. In fiscal 2020, workshops were held online amidst COVID-19, connecting employees inJapan and overseas and contributing to creating opportunities for cross-functional communication andfostering a sense of unity among employees. We aim to become “the world’s most preferred and valued
airline group” by aligning the mental vectors of all employees.

JAL Group Corporate Policy

Foreword

With an awareness of the need to change employee mindset
based on lessons learned from our bankruptcy, we establishedthe JAL Philosophy as a mindset, values, and attitude that all
employees engaged in JAL Group services and products should
possess. All employees carry the JAL Philosophy Pocketbook
with them and deepen their studies so that whenever they
are lost at work or in their private lives, they return to the JAL
Philosophy and base their decisions on doing what is right as ahuman being. We will continue to practice the JAL Philosophy,align our mental vectors, and strive to realize the Corporate

Realization of the Corporate Policy

Foundation for Value Creation/JAL Group Code of Conduct

7. Fair business practices(1) Reinforcing compliance(2) Preventing corruption(3) Fair business relations with business partners(4) Free and fair competition(5) Management of personal information andintellectual property(6) Eliminating relations with antisocial forces
Full text of the JAL Group Code of Conduct

e-Learning video for all staff

https://www.jal.com/en/sustainability/codeofconduct/
Business Performance Reporting Meeting

JAL REPORT 2021

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The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Foundation for Value Creation/Corporate Governance
Basic Stance

Board of Directors and Directors

We maintain an awareness that the JAL Group is a corporate citizen with the duty of fulfilling our financial responsibilityof earning adequate profits through provision of high quality products in a fair and competitive environment as well as
fulfilling our corporate social responsibility. Thereby, we will deliver unparalleled service to our customers, while upholding
safety as a leading company of safety in the transport sector.
Based on this stance, we have established the JAL Philosophy based on the Corporate Policy, and a corporate governance systemthat exerts strong management monitoring while maintaining high management transparency and makes speedy and appropriate
management decisions in order to increase corporate value and fulfill accountability.

https://www.jal.com/en/outline/governance/

Corporate Governance System

Appointment/Dismissal
Appointment/Dismissal

Corporate GovernanceCommittee

Board of Directors

Advisory/
Recommendation

Nominating Committee
Compensation Committee

Appointment/
Dismissal,
Instruction

Personnel Committee
Officers Disciplinary
Committee
Advisory/
Recommendation

Executive Management
Council

Audit

Appointment/Dismissal,
Supervision/Instruction/
Delegation of Authority

President
Instruction/
Delegation of
Authority

ReportAppointment/
Dismissal

Accounting Auditor

Financial Audit
Report/Collaboration

Audit
Department

Collaboration

Instruction/Report

Councils andCommittees, etc.*1[Response to the Spread of COVID-19]

JAL Philosophy
CouncilPresidentGroup Safety
Enhancement
Council＜Outside Directors＞①O
 utside Directors provide advice to management from apractical and multilateral perspective and monitor businessexecution appropriately. Any person who does not qualify
as highly independent within the definition of Standards
for Independence of Outside Directors established by
the Company shall not be nominated. For Standards for
Independence of Outside Directors, please refer to the JAL
Group Fundamental Policies of Corporate Governance.
② One Outside Director shall be appointed as Lead
Independent Outside Director to improve coordination
with Audit and Supervisory Board Members and internal
divisions.

In fiscal 2020, a total of 20 regular monthly Board meetings and extraordinary Board meetings were held.

Departments andSubsidiaries

Group Business
Performance
ReportingMeetingcomposition diverse in terms of gender, nationality, work
history, age, and other variables. Directors are nominatedfrom among persons with extensive experience, deep
insight, and specialized knowledge in various fields.
② In fiscal 2021, we decided to increase female Director
appointments.
③ In fiscal 2021, we formulated and published a skills matrix
specifying the specialized knowledge and experience
required of Director.

Main Agenda Items Discussed by the Board of Directors
Audit

*

① In fiscal 2021, we redefined diversity to make board

Collaboration

Supervision

1 Councils and Committees

monitoring with a high degree of transparency throughthe nomination of Directors, Audit and Supervisory Board
Members and Executive Officers, decision of director
remuneration, and important decision-making.
① T he Board separates the management monitoring
and business execution functions. The Board Chair
is nominated from among Directors who do notconcurrently serve as Outside Officer.
②A
 t least three highly independent candidates arenominated for Outside Director, and from the Ordinary
General Meeting of Shareholders in June 2021, Outside
Directors account for at least one-third of all Board
members.
③ F rom fiscal 2021, Directors and Audit and Supervisory
Board Members are required to basically attend at least
80% of all Board meetings.
④ T he Board delegates appropriate authority to the
President to ensure efficient decision-making.

Medium Term Management Plan

Executive Officers

Instruction

Audit &
Supervisory Board

Decision of
Proposals regarding
Appointment/
Dismissal＜Board diversity＞

The JAL Group Value Creation Story

General Meeting of Shareholders■ Directors

The Board of Directors exercises strong management

Foreword

Please visit the JAL website for the Fundamental Policies of Corporate Governance and the Corporate Governance Report.

■ Board of Directors

Group Risk
Management
CouncilFinancial Risk
Committee· Board Effectiveness Assessment (P. 25)· Director remuneration· Strengthening internal controls in the JAL Group

Sustainability
Promotion
Committee

Group
Management
CouncilCustomer Experience
Promotion Committee
JAL Wellness Promotion
Committee
Tokyo 2020 Olympic
and Paralympic
Promotion Committee· Formulation of a new Medium Term Management

Plan- Business strategy (LCC business, new businesses, etc.)- Finance strategy- ESG strategy· The active role of women and Board member
development· IT BCP (Business Continuity Plan)· Serious incident reports[Dialogue with Stakeholders]· Feedback on IR (Investor Relations) briefings, etc.
· Customer Voices[Decision-making and monitoring of theexecution of important business matters]

Data Book

Risk Management andInformation Security
Committee· Decision of executive appointments· Financing[Management strategy]
Sustainability
PromotionCouncil[Governance and risk management]· Agile business - Earnings policy

Investment Monitoring
Committee

21

JAL REPORT 2021

JAL REPORT 2021

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The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Optional Committees

Audit and Supervisory Board and Its Members

InsideOutsideCommittee

Corporate GovernanceCommittee

Nominating Committee

Compensation
Committee

Personnel Committee

Officers Disciplinary
Committee

ChairmanLead Independent
Outside Director

Outside Director

Outside Director

President

Outside Director

AKASAKA Yuji

〇

〇

〇

〇

SHIMIZU Shinichiro

〇
〇

〇
〇

〇
〇
〇

UEKI Yoshiharu〇〇

HATCHOJI Sonoko

〇

〇

〇

〇

YANAGI Hiroyuki

〇

〇

〇

〇

Checks whether businessactivities comply with the
JAL Group Fundamental
Policies of Corporate
Governance, conducts
analysis and assessment
to determine whether
they will contributeto sustainable growthand enhancement ofcorporate value overthe medium- to longterm, and provides
necessary feedback andrecommendations to theBoard of Directors.

Submits a report on
inquiries from theBoard regarding
the nomination of
Directors and Audit
and Supervisory Board
Members. Defines
the qualificationsof President andother executives andmanages Board member
development. Reports
to the Board in theevent qualifications ofsenior management arequestioned.

Submits a report on
inquiries from the Board
regarding remunerationof Directors, Executive
Officers and Audit
and Supervisory Board
Members. Inspects the
remuneration system
to ensure it provides
sound incentives towardsustainable growth.

Twice

6 times

7 times

4 times

In view of the directionof revisions to the
Corporate Governance
Code in 2021, thecommittee discussed
matters related to theFundamental Policies ofCorporate Governance,
and formulated andreported the policy on
the Board Effectiveness
Assessment.

In addition to reports
submitted to the Board,the committee discussed
management of Board
member development
including the President
and the requirements
and nomination processof Directors when they
are changed.

In addition to reports
submitted to the Board,the committee discussed
how the director
remuneration systemshould meet current
business conditions.

In addition to reports
submitted to the Board,the committee discussed
the new businessexecution systemand development of
Executive Officers.

Overview〇
Decides disciplinary
action of Directors andExecutive Officers.

0 times① The qualifications required of the President and otherleaders are as follows: “Persons with qualities to steadily
achieve positive results toward realizing the Corporate
Policy by working together with all employees based ona firm commitment to flight safety, which is the basic
foundation of business continuity for the JAL Group. They
must also display initiative in practicing the JAL Philosophy.
The Nominating Committee continuously discusses
possible candidates for President and other executives. By
providing candidates with practical and diverse experiences,such as management in a Group company and overseas
assignments and activities in external organizations, theyacquire the necessary grounding for management at an
early stage.

② To develop the next generation of executives including
Executive Officers, the Personnel Committee discusses
career path mapping, cross-functional rotation, external
networking and human resource pooling to promote
diversity and expand their capacity and perspectives.

Support for Directors and Audit and Supervisory Board Members① Legal considerations are explained to Directors, asnecessary, to ensure that they are fully aware of theirduties, including the fiduciary duties of the duty of loyalty
and the duty of care. They are provided opportunities forcontinuous participation in external training and affiliatedorganizations.
② In addition to the provision of corporate information, Audit
and Supervisory Board Members are given opportunities toparticipate in external training and external organizations.

③ Outside Directors and Outside Audit and Supervisory Board
Members receive advance explanations on Board agendas,
corporate information and other requests, as appropriate.
In order to deepen the understanding of the Company,
Directors and Audit and Supervisory Board Members receive
explanations on safety matters through visits to frontlines,a climb up Mt. Osutaka, the crash site of the JAL Flight 123
accident, and a tour of the Safety Promotion Center, andexplanations on company history and the JAL Philosophy.

JAL REPORT 2021

Data Book

JAL REPORT 2021

Audit and Supervisory Board Members attend Board
meetings and other important meetings, and audit importantmanagement matters, business operations and businessexecution by exchanging opinions with Representative
Directors and Outside Directors, and inspecting important
agenda items and resolutions to be passed. They also audit
business sites and subsidiaries each year together with theSuccession plan for President and other leaders

In addition to the above voluntary committees, the Lead Independent Outside Director organized a few Independent Outside Audit
and Supervisory Board Member Opinion Exchange Meetings, comprising only Outside Directors and Outside Audit and Supervisory
Board Members, to strengthen the network between Outside Directors.

23■ Audit and Supervisory Board Members

Corporate Auditors Office, report back to Representative
Directors and provide feedback to executing departments.
Further, they work closely with the internal Audit Department
and accounting auditors, meet regularly with full time auditorsof major subsidiaries, and strive to improve and strengthenGroup auditing.
Audit and Supervisory Board Members are nominated fromamong persons with extensive knowledge and experience invarious fields to conduct audits from a neutral and objective
perspective and ensure sound management.
Any person who does not qualify as highly independent within
the definition of Standards for Independence of Outside
Directors established by the Company shall not be nominatedfor Outside Audit and Supervisory Board Member.
For Standards for Independence of Outside Directors, pleaserefer to the Fundamental Policies of Corporate Governance.

Medium Term Management Plan

Frequency and main
discussions at meetings
in FY2020

Submits a report on
inquiries from theBoard regarding
the nomination anddismissal of Executive
Officers.

The Audit and Supervisory Board makes objective andappropriate decisions from an independent standpoint, basedon their responsibility to our shareholders, in fulfilling theirrole and responsibility pertaining to their duties, namely,
audit of business execution, nomination and dismissal of
accounting auditors, and exercise of rights concerning auditor
remuneration.

The JAL Group Value Creation Story

KOBAYASHI Eizo〇〇

■ Audit and Supervisory Board

Foreword

Committee

We have established various committees under the Board of Directors in order to build a corporate governance system that demonstrates
high management transparency and strong management oversight. A majority of the committee members are Outside Directors,
ensuring independence from management.

24

Chapter

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The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Board Effectiveness Assessment

Skills Matrix

The Company aims to increase corporate value over the medium- to long-term through a Board Effectiveness Assessment each year,with reference to the self-assessment of each Director and Audit and Supervisory Board Member, and a review of Board operations
to increase corporate value over the mid- to long-term.

FY2020Board Composition
Monitoring

Initiatives

Conducted analysisof the current
situation anddiscussions to solve
issuesThe discussions led
to the establishmentof higher level
management targets
to promote women’s
participation andadvancement in theworkplace.

Appointment ofofficers: Need todeepen activities of
remuneration andpersonnel
committees andimprove reportingto the Board.

Improve the content
of committee
discussions andreport the review
process to theBoard.

Conducted effective
monitoring,
including advice on
solving issues.
The Group
governance system
was restructured.

Need to strengthenGroup governancefor new businesses
through monitoring.

Strengthen
monitoring of new
businesses fromthe perspective of
business, earnings
and human
resources.

Focused on strategic
discussions
responding to the
COVID-19 pandemic
and thepost-COVID-19
world.

Need to holdin-depth discussions
on the long-term
vision and businessportfolio post
COVID-19.

Monitored specificthemes semiannually

Discussed
perceptions of theenvironment
surrounding theaviation industry
and the vision wewant to realize for
the JAL Group.

Dialogue with
Shareholders

In-depth discussions
on long-term issues
and visions areneeded.

Challenges

For details of 2020 assessment results and future initiatives, please refer to Corporate Governance on the JAL website.

https://www.jal.com/en/outline/governance/

JAL REPORT 2021

Improve provisionof information toindividual investors
and strengtheninteractive
communication.

Finance &Accounting

Director, Chairperson

UEKI
Yoshiharu○○

Representative
Director, President

AKASAKA
Yuji○○

Representative
Director, Executive
Vice President

SHIMIZU
Shinichiro

Representative
Director, Senior
Managing Executive
Officer

KIKUYAMA
Hideki

Director, Senior
Managing Executive
Officer

TOYOSHIMA
Ryuzo

Director, Managing
Executive Officer

TSUTSUMI
Tadayuki

Outside Director

KOBAYASHI
Eizo

Outside Director

HATCHOJI
SonokoOutside Director

YANAGI
Hiroyuki

Audit and Supervisory
Board Member

SAITO
Norikazu

Audit and Supervisory
Board Member

KITADA
Yuichi

Outside Audit andSupervisory Board
Member

KAMO
Osamu

Outside Audit andSupervisory Board
MemberKUBO
Shinsuke○○○

Outside Audit andSupervisory Board
Member

OKADA
Joji

○

○

○

○

○

Legal/Risk
Management

SafetyManagement

GlobalExperience

Sales/
Marketing

IT/Technology

○

○

○

○

○

○

○

○

○

○

○

○

○
○
○

○

○

○

○
○

○

○
○

○

○

○

○

○

Data Book

25

Need to strengthen
constructive
dialogue withshareholders.

Develop strategies
to realize along-term vision
includingsustainability.

Management
Experience

Medium Term Management Plan

Medium- to Long-term
Strategy

Monitoring needs
to be enhanced tostrengthen risk
management.

Assessment

Name

The JAL Group Value Creation Story

Assessment Items

Diverse discussions
on human resource
strategy are needed.

Initiatives

Position at theCompany

Foreword

Challenges

FY2021

We have created a skills matrix, which is a set of skills required by Directors and Audit and Supervisory Board Members regarding
their specialized knowledge and experience. It includes basic corporate management skills of management experience, financial
accounting, and legal affairs and risk management, and also safety management, which is particularly important in view of ourbusiness characteristics, global experience, sales and marketing, and IT and technology.

JAL REPORT 2021

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Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Foreword

The JAL Group Value Creation Story

Management Team (Board of Directors)②④

Director, Chairperson

Representative Director, President

Since joining the Company, he has acquired an extremely
high level of insight on flight safety and frontline
experience as a pilot. As Representative Director andPresident from 2012, he demonstrated strong leadershipand determination to direct, formulate and execute theMedium Term Management Plan. Since 2018, he has
contributed to strengthening the monitoring and advisory
function of Board of Directors as Board Chair and amember of Corporate Governance Committee.

Since joining the Company, he has been mainly engaged
in maintenance and engineering and acquired frontline
experience and deep insights into flight safety, as wellas in-depth knowledge and a broad network in theengineering and maintenance industry. From 2014, hebrought his strong leadership and decision-making skills
to JAL Engineering Co., Ltd. as President and solidified thefoundation of flight safety. As Representative Director andPresident of the Company since 2018, he has been working
intensively to maintain flight safety, the basic foundation of
the JAL Group, and has been leading our employees towardrealizing the Corporate Policy through proactive display of
his initiative to practice the JAL Philosophy.

③ SHIMIZU Shinichiro④ KIKUYAMA Hideki

Representative Director, Executive Vice President

Representative Director,
Senior Managing Executive Officer⑤ TOYOSHIMA Ryuzo⑧ HATCHOJI Sonoko⑨ YANAGI Hiroyuki*

Since joining the Company, he has held successive
positions in IT systems, passenger reservations, humanresources, industrial affairs, corporate planning and otherdivisions at JAL Head Office and the Americas Regional
Office, and has demonstrated exceptional leadershipand strong planning and coordination skills. As SeniorVice President of Managing Division Route Marketingfrom 2013, he contributed greatly to maximizing route
profitability. Since 2016, as Senior Vice President of
Financing and Accounting, he has demonstrated precise
management decision-making skills that contribute tocomprehensible and highly transparent disclosures to ourshareholders and investors, and for the interests of ourshareholders.

Director, Senior Managing Executive Officer

Independent Outside Director

Independent Outside Director

Since joining the Company, he has held successive
positions in industrial affairs including Vice President
and has achieved positive results with his exceptional
leadership and strong planning and coordination skills.
As Senior Vice President of Corporate Control from2015, he contributed significantly to the expansion of
the divisional profitability management system across
the JAL Group. Since 2019, he has greatly contributed tomaximizing route profitability as Senior Vice President ofManaging Division Route Marketing.

She has extensive experience in financial productdevelopment, financing and risk management at banks,and in-depth knowledge and experience in customercentric marketing in hotel management. She also possesses
comprehensive knowledge and experience in management
strategy and diverse perspectives in educational reform atuniversities. She draws on her experience to provide advice
on management and appropriate monitoring of businessexecution.
≪Important positions concurrently held≫
Outside Director, Daicel Corporation
Outside Director, Maruha Nichiro Corporation

He has a wealth of experience and knowledge as a senior
management executive at companies that promote
global expansion. He provides advice to our management
executives and monitors business execution from apractical and multilateral perspective.
≪Important positions concurrently held≫
Chairman and Representative Director, Yamaha MotorCo., Ltd.
Outside Director, AGC Inc.
Independent Non-executive Director,
Kirin Holdings Company Limited(September 16, 1952)(December 13, 1962)

Since joining the Company, he has held various positions
in personnel and industrial affairs related to pilots andcabin attendants, and has exercised strongly leadershipand planning and coordination skills to achieve positive
results. As Senior Vice President of Human Resource
Management from 2013 and head of the Executive
Secretariat Office from 2016, he made considerable
contributions to improving and stabilizing JAL’s presenceby taking a bird’s-eye view of the Company. Since April
2020, he has assisted the President as Representative
Director, Executive Vice President and has contributed tostrengthening and improving management.

③⑥(January 3, 1962)(March 19, 1960)⑥ TSUTSUMI Tadayuki*⑦ KOBAYASHI Eizo

Director, Managing Executive Officer

Independent Outside Director

Since joining the Company, he has acquired an extremely
high level of insight on flight safety and frontline
experience as a pilot. Serving as Executive Officer of
Flight Operations from 2019 and Senior Vice President ofCorporate Safety and Security since 2020 to present, he
has greatly contributed to maintaining flight safety withhis strong sense of responsibility and ethics.

He has extensive experience and vast insight on global
business management and leadership at diverse groupcompanies as top management of a general trading
company. He brings practical and diverse perspectives
to management and appropriately monitors businessexecution from a practical and multilateral perspective.
≪Important positions concurrently held≫
Outside Director, OMRON Corporation
Outside Director, Japan Exchange Group, Inc.

(December 19, 1960)

⑦

⑨

⑧

①

(August 17,1959)(January 15, 1950)(January 7, 1949)

Data Book② AKASAKA Yuji

Medium Term Management Plan⑤

① UEKI Yoshiharu(November 20, 1954)* Newly nominated at the 72nd Ordinary General Meeting of Shareholders held on June 17, 2021.

27

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28

Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Management Team (Audit and Supervisory Board Member)■ Standards for Independence of Outside Directors

Foreword

1. A person who is currently or has been in the past 10 years an executive* of consolidated subsidiaries in our company and ourcompany.
2. A person who has fallen under any of the following (a) to (f) in the past three years.
a.	A business partner or an executive thereof whose transaction amount with our company for one business year exceeds 1% of
our company or any of the said business partner’s consolidated subsidiaries in sales.
b.	A major shareholder or an executive thereof whose ratio of funding to our company is 5% or more.
c.	Major lenders to our company or an executive thereof.
d.	A person who receives or belongs to an organization that receives donations exceeding 10 million yen per year from ourcompany.
e.	A person who has received more than 10 million yen per year other than remuneration as an officer, or a person who belongs
to an organization that has received remuneration in excess of 1% of its remuneration consolidated sales.
f.	An executive who is assigned as an external executive of another company and also the Director of the company.
3. A spouse or a relative within the second degree of kinship to the persons listed in 1 and 2 above.
* An executive means an Executive Director or an Executive Officer.

The JAL Group Value Creation Story① SAITO Norikazu② KITADA Yuichi*③ KAMO Osamu

Audit and Supervisory Board Member

Audit and Supervisory Board Member

Since joining the Company, he has worked mainly infinance and accounting for many years and possesses
extensive knowledge of finance, accounting, andinvestor relations. From 2014, serving as Director, Senior
Managing Executive Officer and Senior Vice President of
Finance and Accounting, worked intensively on providing
comprehensible and highly transparent disclosures to ourshareholders and investors, and contributed significantly
to making accurate management decisions on shareholder
returns.
≪Important positions concurrently held≫
None

Since joining the Company, he has worked mainly
in maintenance including maintenance technology
and quality assurance. Serving as Executive Officer ofEngineering and Maintenance from 2018, he supervised
the maintenance division of the JAL Group andcontributed significantly to maintaining and improving
engineering and quality. Since June 2020, as Managing
Executive Officer of Engineering and Maintenance, he has
provided precise comments at Board meetings and othermeetings from the perspective of maintaining flight safety
based on his extensive frontline experience in engineeringand quality assurance.
≪Important positions concurrently held≫
None

Outside Audit and Supervisory Board Member/
Independent Director
Since registering as an attorney-at-law in April 1973, he
has accumulated extensive experience and insight oncompliance and corporate governance, including guidanceon compliance for government agencies and companies
and working in an investigative committee on fraud. Since
June 2016, he has provided legal and auditing advice to
the Company as an Audit and Supervisory Board Member.
≪Important positions concurrently held≫
Attorney at Law, Managing Partner of Ginza Sogo Law
Office.
Outside Audit and Supervisory Board Member of Azearth
Corporation④ KUBO Shinsuke⑤ OKADA Joji⑤

Outside Audit and Supervisory Board Member/
Independent Director

Outside Audit and Supervisory Board Member/
Independent Director

Since joining Sanwa & Co. Tokyo Marunouchi Office(currently Deloitte Touche Tohmatsu LLC), he has gained
a wealth of experience, achievements and deep insight on
accounting through experience in corporate audits, sharelistings, corporate revitalization, M&A and other cases.
≪Important positions concurrently held≫
Representative Partner, Kyoei Accounting Office Certified
Public Accountant
Outside Audit and Supervisory Board Member,
Kawasaki Kisen Co., Ltd.

He possesses extensive experience and expertise as asenior management executive and director of finance andaccounting at a general trading company. Through his
experience as Audit and Supervisory Board Member of ageneral trading company and Chair of the Japan Audit
and Supervisory Board Members Association, he has
gained a good understanding of governance and auditing
including risk management.
≪Important positions concurrently held≫
Member of the Business Accounting Council of Financial
Services Agency
Outside Director, Nippon Exchange Self-Regulation
Organization(October 10, 1951)(March 25, 1947)

③

②

①

④
Data Book(March 4, 1956)(June 22, 1960)

Medium Term Management Plan

(November 23, 1956)* Newly nominated at the 72nd Ordinary General Meeting of Shareholders held on June 17, 2021.

29

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30

Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Message from Outside Directors
Further promotion of diversity from the viewpoint ofsustainability

Outside Director
Attendance at Board meetings: 100% (20out of 20 meetings)

Towards a sustainable future

The JAL Group Value Creation Story[Important positions concurrently held]
Outside Director, Daicel Corporation
Outside Director, Maruha Nichiro Corporation

Foreword

HATCHOJI Sonoko

The JAL Group is committed to achieving the SDGs. The new Medium Term Management
Plan has defined specific issues in four areas; Environment, People, Communities, andGovernance, and aims to create a sustainable society. Regarding the Environment, I
applaud the Company for drawing up a concrete roadmap to achieve net zero carbon
emissions by 2050, which was announced in early 2020. As for Communities, personal
knowledge gained through interactions with regional communities will transform into
organizational knowledge and will be used to strengthen relationships with communities
and customers in the future.
We will also focus on governance and human resource development to support this.
Amid the rapidly changing business environment, we will strengthen initiatives to develop
diverse human resources who can participate in management in the future. Fortunately,
the JAL Group has many outstanding women with specialized knowledge, abilities andgreat potential. In order to further promote diversity, I feel that in addition to providing
training, we need to more boldly allocate experts in their specialized fields across divisions
at a certain stage and develop them through practical experience as candidates forManager and Director. I will contribute to the promotion of sustainability of the Company
based on my own experiences.

The JAL Group has three Independent Outside Directors, who actively share their opinions
at Board meetings and committee meetings, and whose experience and knowledge isutilized in the formulation of JAL Group strategies and management decisions.

Outside Director

Attendance at Board meetings: 100% (20out of 20 meetings)[Important positions concurrently held]
Outside Director, OMRON Corporation
Outside Director, Japan Exchange Group, Inc.

31

JAL REPORT 2021

The JAL Group’s strength lies in its world-class JAL brand and strong human resource base.
The fact that each employee understands their mission and devotes themselves to theirwork is a great asset to the company. I am working to strengthen corporate governancefrom the standpoint of Lead Independent Outside Director and believe the Company
has achieved high corporate governance through its honest approach. However, given
uncertainty of the future in the COVID-19 pandemic, a higher level of risk management
is needed, which requires capacity building to proactively respond to issues throughinformation-gathering and multilateral analysis. Furthermore, we will closely monitor
development of management competencies, which is an important responsibility of theBoard, with consideration to business and management experience and career path
mapping including experience in overseas postings.
Society is changing dramatically and we have entered a new normal that has arisen
during the pandemic. The new Medium Term Management Plan provides the result of ourcomprehensive portfolio view, but we will need to be prepared to stand at the forefront of“creating a new normal” in the Company. To this end, it is important to actively engage
in exchanges between different industries and to develop and promote young mid-level
employees, who will play a leading role. Risk management needs to be strengthened,
while cultivating a corporate culture of embracing challenges without fear of failure. I
would like to make the most of my many years of experience and knowledge in a general
trading company to fulfill my responsibilities to see the JAL Group achieve sustainablegrowth and increase corporate value.

I am YANAGI Hiroyuki and was recently appointed Outside Director. I have been engaged
for many years in global management in the manufacturing industry, which is grounded inrobust safety and high quality. Although there are differences between the manufacturingindustry and service industry, I will use my experience and knowledge to contribute to thedevelopment of the company.
When evaluating the quality assurance system that supports aviation safety, threeperspectives are important. Can “management” grasp the current situation and speak
frankly about the company? How accurate are “frontline operations?” Are businessprocesses documented in manuals? What exactly is “management that links managementwith the frontline”? In other words, are systems for education, open organizations andaccident prevention in place? I would like to visit the frontline to provide guidance andadvice in these areas.
I also hope to be helpful in promoting global expansion in the post COVID-19 world.
The essence of globalization is value creation and commercialization. We must create
value utilizing the JAL Identity and JAL Brand under the Corporate Policy while identifying
diverse market characteristics and targets. To commercialize products and services, weneed to develop new business models and systems in close cooperation with customers
and markets, and to secure and develop suitable human resources.
From this perspective, my role will be supporting management in implementing
appropriate, swift and decisive management practices in order to achieve medium- tolong-term growth and increase corporate value.

YANAGI Hiroyuki
Outside Director[Important positions concurrently held]
Chairman and Representative Director,
Yamaha Motor Co., Ltd.
Outside Director, AGC Inc.
Independent Non-executive Director,
Kirin Holdings Company Limited

JAL REPORT 2021

Data Book

Lead Independent Director

Ensuring Safety, Quality and Strengthening Global
Management

Medium Term Management Plan

KOBAYASHI Eizo

Cultivating a corporate culture of embracing challenge
without fear of failure at a time of great upheaval

32

Chapter

1

The JAL Group Value Creation Story

The Value Creation Process

70 Years of History

JAL Group’s Strengths

Foundation for Value Creation

Message from the Chair of the Board of Directors

Fostering a relationship of trust with each employee is the foundation of
corporate governance● Basic Policy
1.	To achieve sustainable and steady growth and increase corporate value over the medium- to long-term, we promote businessexecution in accordance with the Corporate Policy and management strategies, and strongly motivate Directors to achieve specificmanagement goals.
2.	We will establish appropriate ratios for performance-linked bonus linked to fiscal year performance, and for the purpose offurther promoting the alignment of interests with shareholders, establish appropriate ratios for performance-linked shared-based
remuneration linked to corporate value in accordance with medium- to long-term performance, in order to contribute to thedemonstration of a sound entrepreneurial spirit.
3.	We will provide remuneration that is appropriate to management in accordance with our business performance.
● Remuneration levels and remuneration composition ratios
1.	We will set appropriate remuneration levels with reference to the business environment and objective remuneration data in themarketplace.
2.	Taking into account the business characteristics of the Company and the effectiveness of performance-linked remuneration, fixed
remuneration and performance-linked remuneration shall be established as follows:■ Framework for performance-linked remuneration
1.	Performance-linked bonus
The amount of performance-linked bonus to be paid willvary from approx. 0 ~ 200 depending on the degree ofachievement, with 100 as the amount to be paid in thecase of achievement in line with performance targets.

2.	Performance-linked share-based remuneration
The number of shares to be granted as performance-linked
share-based remuneration will vary from approx. 0 ~ 220depending on the degree of achievement, with 100 as thenumber of shares to be granted in the case of achievement
in line with performance targets. The performance
evaluation period shall be three years, with performancefor three consecutive fiscal years evaluated each year.

■	Performance indicators (adoption of IFRS under consideration)●	Net profit attributable to shareholders of the parent company●	Indicators related to safe operation●	Individual evaluation indices for each director, etc.

■	Performance indicators (adoption of IFRS under consideration)●	Consolidated operating profit margin●	Consolidated ROIC●	Customer satisfaction, etc.

The JAL Group Value Creation Storyand opinions and deliver safety and security based on arelationship of trust with many colleagues, including airport
staff and cabin attendants. The role of Board Chair is to create
the best symphony (decision) by harmonizing various tones(opinions) just like the conductor of an orchestra, through freeand vigorous discussion. Opinions are sometimes divided evenin our company, but in the end, we move on to a resolution
based on mutual trust, and every employee on the frontline
heads toward the direction pointed out by the Board. I fulfill
my role as Board Chair to unite management and the frontline.
Although the COVID-19 pandemic has devastated theaviation industry, my experience as pilot has shown me that
we can overcome any crisis with sufficient preparation. We
are determined to become “the world’s most preferredand valued airline group” and meet the expectations of our
stakeholders.

■ Policy on decision of director remuneration

Foreword

The Board of Directors is expected to promote thesustainable growth of the company and the enhancement ofcorporate value over the medium- to long-term based on its
responsibilities to our shareholders and stakeholders. In orderto fulfill this role, we must provide highly effective supervisionfrom an independent standpoint, while taking appropriate
risks and presenting the general direction we are heading.
The Board comprises members of diverse backgrounds
and extensive knowledge, and diversity is our strength.
In particular, Outside Directors, who possess extensive
management experience and advanced expertise, express
opinions that are rarely raised by our executives. In many
instances, proposals are not approved as originally drafted
due to severe objections. In that sense, there is no doubt thathighly effective supervision is in place.
On the other hand, in order to increase corporate value overthe medium- to long-term, we should not be complacent withthe status quo but instead draw up, through constructive
discussion, the overall direction of the company, such as our
vision and management plan. Having worked as a pilot for
more than 30 years since joining the company, I am highly
aware that the mission of a pilot is to gather information

Director remuneration

Medium Term Management Plan

(Standard in case of achievement in line with performance targets is 100%)

UEKI Yoshiharu
Chair of the Board of Directors

Fixed remuneration

50%

Performance-linked
remuneration
30%

Basic remuneration

20%

Performance-linked Performance-linked
share-based
bonus
remuneration* The above is a rough estimate and will fluctuate depending on the price of our company shares.

■ Payment of remuneration to Directors and Audit and Supervisory Board Members (FY2020)
Data Book

Total remuneration by category, etc. (1 million yen)
Number ofpeopleTotal remuneration, etc.
(1 million yen)

Basic remuneration

Performance-linked
bonus

Performancelinked share-based
remuneration

Director

11

294

294

ー

ー

(including Outside
Director)

(3)

(36)

(36)

(ー)

(ー)

Audit and Supervisory
Board Member

6

77

77

ー

ー

(including Outside Audit
and Supervisory Board
Member)

(4)

(28)

(28)

(ー)

(ー)

Total

17

371

371

ー

ー

Position

33

JAL REPORT 2021

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34

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

02

Medium Term Management Plan

Management Strategy
Environmental AwarenessChanges in behaviors and values and unprecedented environmental changes are expected to last even after COVID-19
subsides. Some of these trends are already becoming apparent.

Macro Environmental Trends
Politics

Largest economic contraction
since the end of WW2• Risk of long-term economic
stagnation• A move from centralization to
decentralization andmultipolarization•

Increasing importance ofsustainability• Transition to a resilient society• A move from “mass” to“personal”•

Technology
Foreword

Digitalization and regional
revitalization• Economic recovery by promoting
Japan as a tourism-orient country• Strengthening of environmental
regulations to curb greenhouseemissions•Society andthe Environment

EconomyAcceleration of digitalizationand integration in real life
• Business model reform with DX• The New Normal such as
remote communication andtouchless solutions•

The JAL Group Value Creation Story

Changes in the Business Environment
MarketSociety

Severe damage to business

Structural changes in air
travel demand and changes
in consumer behavior

Growing social awareness toachieve SDGs

Air travel demand in 2020:
reduced by approx. 70% (YoY)*

Medium Term Management Plan

JAL / Airline Industry* vs 2019: Statistics of IATA (International Air Transport Association)

JAL / Airline Industry

Digital transformation will makesignificant structural changes in
air travel demand and changes in
consumer behavior. While businesstrips have been partly replaced byvirtual travel, travel to meet in personor to experience something new(experiential travel) is expected to
grow. E-commerce growth is likely
drive personal consumption andlogistics.

Society
There is growing awareness of theneed to tackle social issues suchachieving the SDGs and this trend
is likely to increase in the future. In
particular, the global momentum
towards addressing climate change
as a national goal is increasing andcompanies are required to set longterm targets and take climate action.

Data Book

The COVID-19 pandemic has severely
impacted the airline business andairline financial performance. In
2020, global air transport demand
dropped 70% resulting in significant
industry losses. Demand for JAL
Group international and domestic
flights also fell sharply. Fiscal 2020
was JAL’s first financial loss since ourrelisting in 2012.

MarketAlthough environmental uncertainty remains, the aviation industry is expected to show some recovery over the mediumto long-term led by global economic recovery and growth.

35

JAL REPORT 2021

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36

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Strategic Overview

Timeline
Current conditions

FutureMedium Term
Management Plan
for FY2021-2025

Early recovery
from COVID-19

Realization of“JAL Vision 2030”[Illustrative diagram of profit growth]Business strategy

Foreword

Recovery to pre-COVID-19 level
and return to growth

Restructuring business model addressingchanges in market trends and provide asafe and secure travel experience

Pre-COVID-19
level of profit

FY2020Finance strategy

ESG strategy

Rebuilding our financial base,growth investment,
and shareholder returns

ESG management to achieve
SDGs through business

2021

2022

2023

Olympic and Paralympic GamesTokyo 2020

2024

2025

2030

EXPO 2025
Osaka, Kansai

Target of 60 million
inbound tourists to
Japan
Expansion of Narita
Airport (2029)

Profit target
EBIT*

JPY170 bn

Managementtargets

Medium term management targets

2050

The JAL Group Value Creation Story

Three pillars
of management
strategy

Approx. JPY185 bn

JAL Vision

Net zero
CO2 emissions

Review of fiscal 2020

Strategic Pillars
In order to address environmental changes post COVID-19 and promote sustainable growth and development utilizing JAL
Group’s strengths; our human resource base, customer base and financial base, we will pursue initiatives based on “businessstrategy, finance strategy and ESG strategy” as the pillars of management strategy as mentioned in the Medium Term
Management Plan.

■ ESG strategy

In addition to restructuring the business model to address
market changes, we will implement initiatives to make ourcustomers feel safer and more secure in the recovery andgrowth phase of demand.

Positioning ESG strategy as our top growth strategy,
we will promote ESG management to achieve the SDGs
through business and accelerate CO2 reduction initiatives.

■ Finance strategy

These three strategies are not independent but
interconnected. We believe that simultaneous strategy
implementation will increase corporate value.

On swiftly rebuilding our financial base, which wasdamaged by the serious demand slump, we will steadily
implement investment strategies and profit returns to ourshareholder to achieve future growth.

37

JAL REPORT 2021

• Measures against infectious diseases andmaintenance of air transport networks• Thorough cost reduction and liquidity• Initiatives to create a sustainable society

Positioning of the Medium Term
Management Plan
Although market conditions remain uncertain, efforts
to bring COVID-19 under control such as vaccinations
are making steady progress across society. Against thisbackdrop, from fiscal 2021 onwards, all JAL Group
employees will make combined efforts to adapt toenvironmental changes and achieve sustainable growthand development under the JAL Group Medium Term
Management Plan for FY2021-FY2025, a 5-year plan toachieve speedy recovery from the crisis and the long-termtargets in “JAL Vision 2030.”
We target profit of pre-COVID-19 levels and EBIT of 170
billion yen by fiscal 2023 and EBIT of approximately 185
billion yen by fiscal 2025 as well as achievement of the JAL
Vision and the SDGs by 2030 and net zero emissions by
2050.

JAL REPORT 2021

Data Book■ Business strategy

Global aviation demand, hit by COVID-19 since January
2020, dropped sharply and threw the airline industry andour company into turmoil. In fiscal 2020, we focused on
the three points below while maintaining flight safety,
the basic foundation of our business, and fulfilled our
mission and responsibility as an air transport operator.

Medium Term Management Plan

* EBIT: Earnings Before Interest and Taxes

38

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Business Strategy
Management Targets
FY2025 Targets
Safety andComfort

SafetyComfort(during the entire period of the Medium-term management plan)

NPS*1 +4.0pt (International/domestic flights) (FSC)

EBIT Margin

10% or Higher in FY2023 (to improve onwards)

ROIC

9% in FY2023 (to maintain or improve onwards)
FY2023EPS

Total emission:
below 9.09 million tons
(FY2019 Result)PeopleCommunitiesc. ¥290

No use of virgin petroleum-based plastic at
cabin/lounge (100% switch to eco-friendly
materials at Cargo/Airport service)Group Female Managers Ratio: 30%

19.5% as of
FY2020 end

Consistent efforts to encourage
various human resources todemonstrate their potential■ Finance
In fiscal 2023, which will be a turning point for rebuilding
our financial base, we will strive to achieve pre-COVID-19
levels in each indicator and maintain and improve themfrom fiscal 2023 onwards. In particular, we will offset
the impact of stock dilution from our public offering inNovember 2020.

■ Safety and Comfort■ Sustainability

As a leading company in safety, we aim to maintaina clean record, free of aircraft accidents and serious
incidents. We will also do our best to ensure comfort
both in everyday life and air travel, and provide a worldclass customer experience.

Our Environment strategy is to reduce both single-use
plastics and CO2 emissions, People strategy is to promote
Diversity and Inclusion (D&I) such as increasing the ratio of
female managers, and Community strategy is to promote
domestic transportation that contributes to regional
revitalization.

Promote Business Structure Reform Addressing Changes in the Business Environment
Market changes
COVID-19 has changed the business landscape and has
resulted in two marked changes in market trends.
Firstly, structural change in air travel demand. Our
strategy as a full service carrier (FSC) is to attract businesstravelers; however, demand-side recovery is likely to takesome time. Conversely, leisure and visiting friends andrelatives (VFR) travel markets are likely to fuel demand,and some signs of this have already been observed.
Secondly, changes in consumer behavior. It is suggested
that e-commerce, which grew by leaps and bounds
during the pandemic, will continue strong growth andthat digital transformation will increase rapidly changing
customer demands for personalized service.

Basic stance on business structure reformIn the Medium Term Management Plan for
FY2017-FY2020, we pursued strategies to capture
growing business demand, with international flights in
the FSC business as the growth driver.
In the Medium Term Management Plan for
FY2021-FY2025, we will implement business structuralreform to meet customer and societal needs in the
post-pandemic world, and swiftly rebuild our financial
structure to adapt to environmental changes. We aim
to improve FSC business profitability, expand domains
by drawing on JAL Group’s strengths and management
resources, and diversify revenue streams in non-FSC
business domains.
By doing so, we will increase our risk tolerance while

improving profitability, and build a sustainable businessstructure. In concrete terms, we will reduce dependence
on the FSC business model and target leisure and VRF
travel markets through the LCC business model andprovide new air travel services and services in daily life.

FSC Domain (P. 45)
We will strive to minimize costs through aircraft
downsizing and network optimization and improve
profitability by maximizing revenues through enhanced
product competitiveness and marketing.

LCC Domain (P. 49)
We will deploy three business models; ZIPAIR, SPRING
JAPAN, and Jetstar Japan, in growing low-priced markets
and explore new markets.

Cargo and Mail Domain (P. 51)
We will continue to promote agile capacity strategies tomeet robust demand for air freight and capture demandfor high value-added commodities that require highquality transport so as to secure stable revenues.

Data Book

The JAL Group has set management targets for safety
and comfort, finance, and sustainability to to be achieved
by fiscal 2025, based on global trends, shareholder
expectations, impact on business, and their importanceto management. We will treat them as high priority
management issues.

JAL REPORT 2021

Although it is difficult to predict the future due to major unprecedented shifts in the operating environment, I feelthat it is in these times that we must decide the general direction of the company and steadily move forward without
stopping.
All JAL Group employees will take action to pave the way to a post-COVID-19 era to achieve sustainable growth anddevelopment with society under the Medium Term Management Plan.

Medium Term Management Plan

■ Regional Revitalization
2
Domestic passenger* and cargo transport volume: +10% vs FY2019*1: Net Promoter Score…objective indicator of customer satisfaction (vs the beginning of FY2021)*2: Increases in passenger numbers by stimulating tourism demand and creating new flows

39

Pave the way to a post COVID-19 era■ Reduction of Single-use Plastic■ Promotion of D&I

FY2025 Management targets

Managing Executive Officer
Senior Vice President of Corporate Strategy & Planning
Senior Vice President of Business Administration

The JAL Group Value Creation Story

Sustainability

FY2025¥260 Pre-COVID level■ CO2 Emission Reduction

Environment

SAITO Yuji

Top Level Customer Experience both in air travel services and daily life

Foreword

Finance

Aircraft Accidents and Serious Incidents: 0

Mileage, Lifestyle and Infrastructure Domain (P. 53)
We will apply our strengths such as our customer baseand brand, and human skills such as operational knowhow and technical capabilities to develop businesses ingrowing non-airline domains.

JAL REPORT 2021

40

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Business Structure Reform and Profit Growth

Outline of Business Structure Reform

Changes inmarket trends
during
COVID-19

Structural Changes in
Air Travel Demand

Changes in Consumer
Behavior

Delayed recovery of businessdemand• Solid recovery of leisure and
VFR demand
•

•

UP!

Growth of EC market
Growing needs for personalized
services

LCC

Develop New Markets

Downsizing fleet, optimizing network, andenhancing productcompetitiveness/marketing

Multi-model strategy
in the growing low-yield market

Resumption of highly-profitable internationalroutes• Expand use of JAL’s flagship aircraft – Airbus A350
• Global Expansion of JVs in not only
Pacific/European routes

ZIPAIR: Asia/Hawaii/Pacific routes• SPRING JAPAN: Expand areas in China• Jetstar Japan: Capture tourism demand basedin Narita Airport to act as a hub

Changes in the business structure
FY2019 Revenue Breakdown

FY2025 Illustrative Revenue Breakdown

FSC*
International
passenger❶

Cargo
and Mail

LCC

Cargo and Mail

UP!

Steady Revenue Increase

Expand into Growing Fields

Promoting a flexible supply strategy
featuring cargo space and alliance tie-ups

Expanding business domains leveraging
robust customer base and human skills
Mileage/financial/merchandise services
Expansion of market shares in contracted
services (Ground Handling/MRO/Cargo)• Commercialization of regional revitalizationand next-gen air mobility service
•

•

•

Cargo
❸ and Mail
FSC* Domestic passenger
FSC* Domestic passenger* FSC: Full Service Carrier❶ Promote structural restructuring for growth in LCC andMileage, Lifestyle and Infrastructure❷ Steady recovery from COVID-19 in both FSC and LCC modeland optimize business portfolio❸ Increase revenue steadily in the Cargo and Mail domain

Path to Profit Growth
EBIT: [JPY Bn]

Recovery fromCOVID-19
Actual EBIT(IFRS)

Profit growth ineach domain
Expansion ofBusiness Domains
FSC Profitability
Cargo Revenue
Increase

Network
Expansionc. 185

Data Book

Full utilization of belly space (incl. LCC)
Strengthen collaboration with partners to
expand capacity and network• Capturing demand for items requiring hightransportation quality•

Medium Term Management Plan❷

Expanding business domains to address the changing market trends

Mileage, Lifestyle andInfrastructure

FSC*
International
passenger

Mileage/lifestyle/infrastructure•

Airline-related
business andother

The JAL Group Value Creation Story

Improve Profitability•

Foreword

Full Service Carrier (FSC)•

Going forward, we seek to improve profit by increasing
FSC business and cargo revenues and expanding in LCC
and non-airline domains such as mileage to achieve the
EBIT target of 170 billion yen by fiscal 2023. If we canachieve this profit target, earnings per share will be at thesame level as pre-COVID-19 levels.
We will strive to expand our business domains andachieve EBIT of approximately 185 billion yen by fiscal
2025.

Through business structure reform addressing market
changes, we will reduce dependence on the FSC business,and expand our LCC and non-airline businesses such as
mileage.
As a result, we aim to achieve steady profit growth byfiscal 2023, when a return to 2019 demand levels is
expected, and by fiscal 2025, the final year of Medium
Term Management Plan, and to retrieve 43 billion yen oflosses in the recovery phase, starting from 89 billion yen
in EBIT in fiscal 2019.

170

16

10

12

43

89
FY201941

JAL REPORT 2021

Recovery

FSC/Cargo

LCC

Mileage etc.

2023

2025

JAL REPORT 2021

42

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Air Passenger Business

Air Passenger Business/Aircraft

Both FSC and LCC Businesses Are Essential to Growth

Aircraft strategy to support sustainable growth and development

In addition to diversification of pricing and services tomeet customer needs, a trend observed in pre-COVID-19
times, and growing demand driven by Asia’s economic
growth, business demand is expected to decline post
COVID-19 leading to major structural changes in demand.
The JAL Group will provide both affordable LCC services
and high end FSC services, and build networks covering

We will flexibly introduce and retire aircraft according
to air passenger business strategies, upgrade ourinternational and domestic flagship fleets to fuel-efficientcutting-edge aircraft and introduce the Airbus A350. The
Airbus A350-1000 will start international services fromfiscal 2023.

all markets through integrated international and domestic
services.
Through our joint businesses with leading airlines in key
areas and partnerships including those with oneworld
partners, we will boost demand reciprocally and expand
our networks while reducing risks.

With regard to fleet composition, in order to accelerate
the retirement of old Boeing 777 aircraft, large aircraft
will be reduced and medium and small aircraft will be
increased for the LCC business. As a result, we plan tohave 229 aircraft as of the end of fiscal 2023, an increaseof 11 from the end of fiscal 2020.

Foreword

Renewal of Flagship Fleet

Outline of Air Passenger Business Strategy

Environmental AwarenessMid- to Long-term Demand Trend
Diversification of needs regarding
pricing and services• Growing demands driven by economic
growth in Asia

International: 777-300ER•

Domestic: 777-200/300/200ER(777-200ER to be redeployed to domestic flights)

Decline in business travel following
proliferation of web conferences• Strong leisure/VFR demand in
post-COVID-19 era

•

•

39

Fuel Efficiency
Improvement25%(vs incumbent aircrafts)•

International: A350-1000 (FY2023〜)•

Domestic: A350-900 (FY2019〜)

The JAL Group Value Creation Story

Structural Changes due to
COVID-19 Pandemic•

Interior Renewal to
Be More Preferredby Customers

13*

5（FY2019） （FY2023）

18（FY2019） （FY2023）* GE-manufactured engine only

A350/787 for domestic
flights are equipped withpersonal monitor AC power
in all seats.

Revenue growth in the low-yield market for both LCC and FSC models
Establish comprehensive network for domestic and international routes• Enhance demand and expand the network through JVs with leading airlines in key areas
and align with oneworld partners

Medium Term Management Plan

Strategy of Air Passenger Domain••

Business portfolio
Domestic

International

Stability

High

Full Service Carrier

LCC

Focus on JapanHigh

JAL REPORT 2021

Domestic
Flights

LCC

LCC

American Airlines
British Airways
Finnair
IberiaMalaysia Airlines

Focus on China

Short

International
Flights•

Reduce the ratio of large-sized fleet ［from 18% (FY2019) to 14% (FY2023)]•

Increase fleet for LCC (medium- and small-sized)
241
Large

44

218
27

Medium83

Small
Regional
Propeller

229
31［A350/777］80

82［787/767］

62

61

65

［737］

32
20

32
18

32
19

［E190/170］

2019

Aircraft in service
2020 FY2020:
excluding early retirement

2023

Data Book

Price
range

Growth43

Joint VenturePartners

Fleet Composition (ZIPAIR: from FY2019, SPRING JAPAN: FY2023 only due to consolidation in FY2021)［ATR/Q400/SAAB］(Note) Unless otherwise noted, thenumber is end of the fiscal year aircraft.

Low
Long

JAL REPORT 2021

44

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Air Passenger Business/FSC (international passenger business)
Strengthen measures to capture business demand

Illustrative Revenue Trend

In order to capture greater business demand, a revenue base, we will develop networks, products and services toincrease customer preference.

HanedaAirbus A350-900, which was first introduced on domestic routes.

2025

Foreword

2019 FY2020 2023
（CY）

 Expand the network out of Haneda, which has highdemand among business travelers● Provide products and services that are safe, secure, and clean● Enhance product competitiveness by deploying the
cutting-edge Airbus A350-1000● Expand smart airports (JAL SMART AIRPORT) andtouchless and smooth services via mobile devices●

Boarding procedures utilizing facial recognition technology

Implement business structure reform to improve profitability leading to growth
While suspending operations on unprofitable routes, wewill maintain our network through code-sharing. We will
also introduce cutting-edge aircraft and innovate newservices using the latest technologies to meet diverse
customer needs and increase competitiveness.

The JAL Group Value Creation Story

The impact of COVID-19 on international passenger
demand is expected to linger from 2023 into 2024. For
the time being, we will improve profitability throughbusiness optimization and enhanced initiatives to respondto changes in demand and needs in the post COVID-19
world.

Capture high yield transit passengers between North America and Asia
We will increase high yield demand between North
America and Asia post COVID-19, utilizing Narita’s
improved hub function.

 Create timetables with improved connections
 Open the San Francisco route and Bengaluru route from
Narita● Strengthen web sales in regions outside Japan●●

Improve ancillary services (paid ancillary services)
Changes in the number of aircraft

While promoting business optimization until the recovery of demand, we will
introduce aircraft with superior product competitiveness and environmental
performance to increase profitability, leading to the next growth phase.
Suspend unprofitable routes
 Reduce maintenance costs through early retirement of old, large
aircraft● Enhance product competitiveness and reduce CO2 emissions andoperating costs by introducing the fuel-efficient Airbus A350-1000

In order to meet diverse customer needs, we will create new paid
services and achieve both convenience and profitability.

Medium Term Management Plan

Business optimization

-17%

●
●

FY2019

2023

A350
777
Other

 Current ancillary services• JAL Bid Upgrade (U/G)• Paid advance seat selection (seat with extra legroom)• Paid lounge service

●

VOICE

Employee’s Commitment

Turn a pinch into an opportunity and take on bold challenges in growth markets

Deepen cooperation with partners
 Maintain and expand networks utilizing code-sharing
and joint businesses● Strengthen sales by expanding and promoting joint
businesses●

JAL’s joint businesses/code-share partners: 35 companies
Serviced cities: 440

45

JAL REPORT 2021

Data Book

By deepening cooperation with partners, we willcomplement our route network and improve
convenience. At the same time, we will utilize thesales capabilities in the partner’s home market andcapture inbound demand.

2020 was supposed to be a year of rapid growth generated by significant
increases in international departures and arrivals from the Tokyo metropolitan
area. However, the COVID-19 pandemic turned the situation upside down andI felt frustrated. I will instead look ahead to the future when the pandemic
subsides and make preparations to capture emerging demand. For example, ourmain target on international routes is the growing number of transit passengers
from Asia and North America, triggered by Asia’s economic growth. Previously,
we developed products and services tailored to the tastes of international
travelers and strengthened cooperation with our joint business partners. But
now we are building networks with convenient connections based out of Narita
and improving on our marketing strategies to increase our share in competitivemarkets.
Given the environmental challenges we face, I will continue to do my best to
capture growing demand and put the FSC business back on the growth track.

YOSHINO Kazuki
Planning Group
Route Strategy

JAL REPORT 2021

46

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Air Passenger Business/FSC (domestic passengers)
Strengthening initiatives to capture business demand

Illustrative Revenue Trend

We will improve customer preference through enhanced services that deliver safety and comfort and cutting-edge
aircraft in order to capture business demand, which will become a revenue base.
 Pursue cleanliness and comfort with antiviral coatings inaircraft and airports● Provide touchless, smooth travel with smart airports (expand
JAL SMART AIRPORT services to other airports)● Enhance product competitiveness with the cutting-edge
aircraft Airbus A350-900● Review timetables to cater to business demand●

2025

Enhance product competitiveness and capture growing demand to improve
profitability

Develop regional networks with Group airlines and vitalize regional areas

Given these changes, we aim to improve profitability bystimulating new demand and improving our product andservice line-up based on new values and lifestyles post
COVID-19.

The JAL Group Value Creation Story

On domestic routes, we expect the impact of COVID-19
on passenger demand to subside from the end of 2021
to the first half of 2022. However, major changes inworkstyles and lifestyles are expected, such as theproliferation of remote work and web conferencing.

Foreword

2019 FY2020 2023
（CY）

JAL Group airlines (JAL, J-AIR, JAC, HAC, JTA, RAC), whichhave close ties with the local community, will leverage theircommunity-based strengths to communicate the charms of theregion and fulfill their mission in society as lifeline routes.
Furthermore, we will build JAL Group networks that connect
regional areas in Japan with the world to achieve growth anddevelopment with the regions.
 Develop tour packages to World Heritage sites
 Explore and develop tourism materials in regional areas incooperation with local governments and partners●●

We will maintain business size but optimize routes and enhance productcompetitiveness to improve profitability.
Reduce maintenance costs through early retirement of old aircraft● Enhance product competitiveness and reduce CO2 emissions andoperating costs by upgrading to the fuel-efficient Airbus A350-900● Expand Okinawa routes, with growing demand (open new routes
and allocate large aircraft)

Changes in the number of aircraft
Increase in A350●

777
retirement

FY20192023

Capture growing demand●

47

JAL REPORT 2021

Expand “JAL Vacations (regional passenger transport platform*)” for visitors toJapan, who are expected to increase* An initiative to co-develop, with partners in other industries, attractive products
for visitors to Japan. Currently available in the U.S., Canada, Australia, Southeast
Asia (Thailand, Singapore, Malaysia, Indonesia, Vietnam), and East Asia

VOICE

Employee’s Commitment

Protect sustainable livelihoods on outlying islands andcontribute to regional revitalization
Over 80% of the networks operated by JAPAN AIR COMMUTER (JAC) are lifeline
routes to outlying islands. Our mission is to protect their lifelines, such as hospital
visits, nursing care, and the transport of healthcare and infrastructure workers
and medical and daily essentials. We have maintained flights even in the COVID19 pandemic, while keeping flight reductions to the minimum so that the
network will not be disrupted.
As you may know, several islands in Kagoshima and Okinawa prefectures;
Amami-Oshima Island, Tokunoshima Island, the northern part of Okinawa Island,
and Iriomote Island, were listed as World Natural Heritage sites, the second suchlisting after Yakushima which gained World Heritage status. We aim to increase
travelers to this region, utilizing hopping routes and charter flights.
I would like to create new value while fulfilling our role as “the Wings of Regional
Japan,” and contribute to the development of the region.

Data Book

We will strengthen measures to meet air transport demand
between the Tokyo metropolitan area and regional areas inJapan, stimulated by new lifestyles and values, and measures
to capture growing inbound demand.
 Establish fares and tours leading to urban-to-rural
migration and promotion of workation● Strengthen overseas sales to attract inbounddemand to regional areas across Japan

Launch of specially designed aircraft
to commemorate the listing of
Amami-Oshima Island, TokunoshimaIsland, the northern part of Okinawa
Island, and Iriomote Island as a
World Natural Heritage site (Top:
JTA, Bottom: RAC)

-8%
A350
777
Other

Medium Term Management Plan

Renew aircraft and optimize routes to improve profitability

HASEGAWA Shoichi
Corporate Planning Group, Corporate
Planning Department
JAPAN AIR COMMUTER (JAC)

JAL REPORT 2021

48

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Air Passenger Business Domain/LCC
Building a global network that leverages the strengths of LCCs
Illustrative Revenue Trend(3 LCCs in total)

c.x2

2023

2025

China-focused LCC

Strong LCC Network in theTokyo Metropolitan Area

Capture demand in global major
cities utilizing high-performing
787 aircraft

China-focused operation utilizing
small aircraft partnering with Spring
Airlines, the largest LCC in China

Lead the growth of the domestic
LCC market by leveraging thebusiness model we have developed

Create low-yield travel demand in
Asia, US West Coast, Hawaii, etc.
● Utilize belly space as a revenue source●

Expansion to 10 aircraft by FY2024●

Introduce two aircraft per year

Attract inbound tourists from Chinaleveraging Spring Airlines’ strong
brand recognition in China

Consolidate SPRING JAPAN in
June 2021●

Build global networks of three LCCs based out of Narita〜 “Connecting Regions in Japan with the World” 〜

Achieving high-quality, low-cost operation
fully leveraging resources of JAL Group

Capture tourism demand, mainly throughdomestic flights to/from the Tokyo
metropolitan area (Narita)● Increase revenues under the dual-brandstrategy with JAL in domestic flight operation●

Improve profitability throughbusiness restructuring
Enhance profitability by reviewing
the fleet and network, and enhancecargo revenue● Partnering with the Qantas/Jetstar
Group to strengthen marketing andrevenue management● Utilization of aircraft parked at nightfor short-haul international flights
will improve operations.
●

The JAL Group will build global networks leveraging thestrengths of the three LCCs based in Narita, with safety
and security as our top priority, to connect regional
areas in Japan with the world. We will also contribute toregional revitalization and meet diverse customer needs.

Capture latent demand in regional
cities in China●

NaritaTargeting Chinese cities with a populationof more than 10 million, we will develop
new “white spots” where direct flights are
not yet available.

The JAL Group Value Creation Story* Visit Friends and Relatives
Note: Illustrative map

NaritaMedium Term Management Plan

One of the pillars of the Medium Term Management
Plan is to strengthen and expand the LCC business andincrease revenues in growing VFR* travel markets.
As part of these efforts, we will inject additional capital
into Spring Japan and Jetstar Japan, develop businesses
with the three LCCs including ZIPAIR, and build LCC
networks based out of Narita, while adapting to market
changes post COVID-19.

●

Foreword

FY2019First Mid-to-long Haul LCC
in JapanFull-flat seat installed
in upper class
NaritaSelf-order / free Wi-Fi

Note: Illustrative map
Note: Illustrative map

North America+
Southeast Asia

Cities in China

VOICE

Employee’s Commitment

Become a “NEW BASIC” Airline

Narita Airport

Data Book

ZIPAIR is the newest airline in Japan that started last year. Even amidst the
COVID-19 pandemic, we have offered services that are “just right” forcustomers traveling overseas. We cater to the diverse needs of our customers bydifferentiating ourselves from other LCCs, such as offering full-flat seats, which
are unusual for an LCC, free in-flight Wi-Fi, and flat fares for children under six.
As a result, we are receiving more and more positive comments such as, “I’mglad I chose ZIPAIR. I will fly with you again when returning home.”
We are constantly striving to find out what kind of service satisfies our customers.
After COVID-19 is contained, we look forward to the day when we can welcome
many more customers. I will perform my duties responsibly to support flightsafety and high quality operations of ZIPAIR.

HATANAKA Aoi
Chief Cabin Attendant
ZIPAIR Tokyo

Cities in Japan49

JAL REPORT 2021

JAL REPORT 2021

50

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Cargo and Mail Business
Focus on spot demand

Illustrative Revenue Trend

 Demand for advanced transportation services is increasing due to changes in commodities that are transported
prompted by changes in lifestyles.

●+c.50%

2023

Foreword

FY20192025

e-commerce andhome delivery

Food and
local specialties

Shorterlead time

Thoroughquality control
management

Build aproduction system

Medium Term Management Plan

In order to respond to the strong cargo growth trend,
we will implement agile capacity strategies throughour partnerships and expand our network, using cargospace on passenger aircraft to the maximum capacity.
Furthermore, we will position e-commerce, home delivery,
healthcare products (pharmaceuticals and medical
products), food and local specialties as strategic products,
provide high quality services, and ensure profitable
growth.

The JAL Group Value Creation Story

Focus on spot demand and establishing a system torespond to demand

Meet market and customer needs and achieve stable business development
In fiscal 2020, when COVID-19 began to run rampant
around the world, we experienced a shortage of capacity
to transport air freight due to the significant global
reduction of passenger flights. Under these circumstances,
we actively operated cargo flights using passenger aircraft
on international and domestic routes to create capacity
and transport medical products and daily essentials tomeet customer needs. Especially on international routes,
we used freighters of partner carriers overseas and secured
maximum capacity in the tight air cargo market.

Healthcare products(pharmaceuticals and medical products)

Agile capacity strategy
 Speedily increase capacity and networks by utilizing LCCs and enhanced partnerships to capture growing demand Improve convenience of domestic and international flight connections and optimize networks connecting regional
Japan and the world

●
●

VOICE

Employee’s Commitment

Carry the sentiments behind vaccines

Cargo capacity

Regional Asia

51

JAL REPORT 2021

JAL

Maintain

LCC

Increase

Other airlines

Increase(parterships, freighter charters)

Data Book

North America
Japan

Since we became the first in Japan to transport pharmaceuticals on international
flights, we have pursued air logistics services to support safety and security insociety, such as developing cold storage facilities and transport equipment andestablishing procedures to meet the needs of each customer.
I am in charge of transporting special cargo such as pharmaceuticals and I am
also project leader of COVID-19 vaccine shipments. I am especially determined to
put my knowledge and experience to work to make sure that not a single bottle
is wasted. We are applying our knowledge on temperature control, monitoringtransport time and cargo conditions to ensure the quality of vaccines and fulfil
our responsibility to society.
The shipments consigned to us are filled with the customers’ sentiments. I will
do my best to carry the sentiments behind the vaccines by working professionallyand providing the highest level of value through the transport of air freighttransportation.

TAKANO Yosuke
Marketing Group, Business Promotion
Department
Cargo and Mail

JAL REPORT 2021

52

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Mileage, Lifestyle and Infrastructure Business
Expand domains leveraging JAL Group’s strengths

Mileage and Lifestyle Domain

achieve future growth.
We will draw on JAL Group’s strengths; our customer
base, brand, and human skills, to achieve growth inprofitable domains.

The dramatic decline in air transport caused by the
pandemic has raised awareness of the importance of
establishing non-airline revenue streams and pursuing
compatibility and synergies with the airline business toIllustrative Revenue Trend+c.50%

Strategic outline of Mileage, Lifestyle and Infrastructure Domain
Foreword

Human skills

Customer base/Brand

JAL Group’s strengths

FY20192023
2025* IFRS: excluding revenue transferred to air passenger

Deepen customer relationships and create new revenue streams in non-airline
domains
Mileage and Lifestyle Business Domain
Financial Services

Merchandise

Contracted Services Domain (Ground Handling/MRO/Cargo)
Airport

MRO

Cargo

* A service utilizing cutting-edge IT technology of SBI Sumishin Net Bank enabling customers to complete bank functions such as deposits and payments with a mobile app, using an
exclusive online bank account for JMB members

Medium Term Management Plan

Maximize technical capabilities
to ensure safe operations, andpromote a business model that
supports the needs of theairline industry

In financial services, we will increase the number of JAL
NEOBANK* members and establish a customer base infinancial services, using JMB’s customer base.
In the-commerce (product sales) domain, we will expand
our product sales business leveraging JAL’s brand values
and unify sales points of e-commerce sites to develop acomprehensible, user-friendly e-commerce platform.
The JAL Group will continue to pursue an operatorfriendly, user-friendly frequent flyer program to bring JAL
closer to the customers’ daily lives.

The JAL Group Value Creation Story

Mileage

Increase revenue
opportunities by deepening
customer relationships

We will actively utilize the JAL Group membership baseand mileage domain, which we have cultivated in theairline business, to provide new value in customers’ daily
lives and life stages and create new revenue streams in
non-airline domains.
In the mileage domain, we will expand opportunities forcustomers to earn and use mileage in their daily lives andlifestyles, continuously improve the appeal of the JAL
Mileage Bank (JMB) program and increase sales.

Pursue a user-friendly mileage program that brings JAL closer to the customers’ daily lives
 Provide new values in the customers’ daily lives and life stages using JAL Group’s membership base and mileage domain
 Strengthen partnerships in mileage domain, expand financial services and integrate e-commerce domains to create
revenue streams in non-airline domains●●

Regional Business Domain
Evolve into acommunity-based solution
business through regional
revitalization initiatives

TravelInbound demand

Mileage Business

Sales Channels×Logistics
Healthcare

Continue efforts to enhance and differentiate the airline’s business model
Expand opportunities to “earn” and “use” miles by increasing collaborative partners● Increase revenue opportunity by creating services accessible during the daily life of acustomer●

Human Resource Development / Education

Environment●

Intermodal Transport

Mileage and Lifestyle Domain

Co-develop next-gen
transportation and mobility
infrastructure with global
partners

Drone logistics

eVTOL

Residence

EC
RetailHomewareFood
serviceUtilities

Communication

JAL Group Member BaseFinancial Services■ BankingPromote cashless payment
Increase the number of membersof JAL Card / JAL Global Wallet● Expand functions of payment via
smartphones (IC/QR)■ Insurance■ Payment●©Volocopter

JAL REPORT 2021

HealthMedicalService infrastructure●

53

Experience
Entertainment

Daily life

Financial

Next Generation Air Mobility Domain

Clothing

Data Book

Education

Traffic©Volocopter©Bell Textron Inc.

Expand JAL NEOBANK members● Offer travel reserves and housing loans●●

Insurance products in line with each itinerary■ Securities●

Offer investment services according to the stage of life

Product sales domain
Enhance accessibility forusers● Develop and offer
proprietary products incollaboration with Regional
Domain team●

JAL REPORT 2021

54

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Regional Business Domain

Contracted Services Domain (Airport/Maintenance/Cargo)

Create new flows utilizing JAL Group’s strengths and regional resources

Contracted Services Domain(Ground Handling/MRO/Cargo)(Domain total)

FY20192023

2025

The JAL Group has supported commercial aviation growth and increases inairlines’ revenues by actively providing contracted services to other airlines suchas airport handling, aircraft maintenance and cargo handling using our knowhow in flight operations cultivated to date.
We will steadily respond to recovery of aviation demand post COVID-19,
precisely meet changing market needs, and expand ongoing services. By
developing new services based on new technologies, we will support crossboard and cross-continental movements of people and domestic and global
logistics to drive growth in aviation.

Regional Resources
Tourism resources (rich naturalenvironment, cultural heritage,etc.)● Regional specialty goods● Wide variety of art and culture

Regional Business
Seven Priority Businesses
Travel● Intermodal
Transport● Healthcare● Inbound●

Sales Channels×
Logistics● HR Development● Environment●

The JAL Group Value Creation Story

Decentralized society, new workstyles,
and environmental conservation

Changes in theenvironment●+c.50%

Forewordbranches, JAL Furusato (hometown) Ambassadors and JAL
Furusato Cheering Teams, and communities in each prefecture.
We will connect regions in Japan with the world and people
with people and create new flows, applying JAL Group’s
strengths and regional resources to seven priority businesses:
travel (new tourism), inbound tourism, sales channels x
logistics, human resources development, intermodal transport,
healthcare, and the environment.

The objective of regional business, in addition to air transport,
is to utilize our strengths including employees’ knowledge,
experience and skills, and regional resources to create new andsustainable flows of people in order to solve regional problems
and contribute to revitalizing regional economies.
Launched in November 2020, the Regional Vitalization Divisionacts as a bridge and driving force for JAL Group’s regional
activities. It makes continuous efforts to solve regional problems
together with JAL district branches, district airport and cargo

Expand businesses in the contracted services domain using our strengths
to support the development of society and the aviation industry

JAL Strengths
Network
Human resources● Customer base●●Medium Term Management Plan

Strategy of contracted services business

Regional revitalization and problem-solving

 Provide airlines and public agencies with various services leveraging our facilities/equipment and human skills
cultivated in air transportation● Build a solid supply structure in alliance with partners to flexibly respond to changes in demand trends and expand
our market share●

Creating new flows (increase air transport demand)

VOICE

Employee’s Commitment

There are many beautiful places in Japan, which are less traveled and unknown
to many people. My mission is to discover their “treasures,” work with the local
community to find solutions to draw visitors and put our ideas into shape in waysthat only the JAL Group can make possible.
In JAL FURUSATO NOZEI (hometown tax payment charitable contributions), I started
a column on the JAL website outlining what each region has to offer, such as places
for nature lovers, delicious local cuisine, handcraft by artisans, and the people inorder to connect our customers with local communities.
I am meeting with local government officials to increase the number of participating
municipalities in JAL FURUSATO NOZEI. I will continue to do my best to bring smiles
to everyone’s hometowns.

MRO

Cargo

Lead the way to a
tourism-oriented country bysupporting air travel demand

Offer various maintenance andtechnological services from operation
support to equipment services

Provide comprehensive
logistics services to meetstrong cargo demand■ Expand Market Share■ Upgrade Service■ Enhance Logistics Service

High quality and stable services to meetvarious demand (certified by ISAGO)● Packaged services including administrative
operations● Airline marketing to global airlines incollaboration with local municipalities●

Operations support including responses toirregular events and provision of parts,
equipment and tools● Maintenance services for engines andlanding gears● New businesses leveraging expertise in airtransportation (technologies, training
programs, logistics, etc.)●●

Extensive contracted services of cargohandling mainly at hub airports in Japan● Strengthened comprehensive logistics
services using cargo shed facilities● Safety and quality of transportation
leveraging technological support

Data Book

Bring smiles to everyone’s FURUSATO (hometown)

Ground Handling

SAITO Takatoshi
Business Strategy Department
Regional Vitalization

55

JAL REPORT 2021

JAL REPORT 2021

56

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

TOPIC

Next-gen Air Mobility Domain
Create a prosperous and sustainable society by shortening the distance between
people, products, and things
In particular, eVTOL aircraft carrying passengers are
expected to be used in a wide range of areas such as rescue
operations and disaster relief, in addition to air taxi services
from rural to urban areas, utilizing their maneuverability
like that of a helicopter.
The JAL Group will contribute to solving regional issues andcreating new flows in regions in Japan by providing new
mobility services.

Solving regional logistics issues
with drones

As it is important to expand the use of eVTOLs
and increase their acceptance by society, we areworking closely with local governments towards
this end.
In April 2021, Japan Airlines and Mie Prefecture
signed a next generation mobility partnershipagreement to commercialize air taxis. We will work
to revitalize regions by revolutionizing mobility.

From the website of
Mie Prefecture© Volocopter

VOICE

EXPO 2025 OSAKA,KANSAI
An age of new air mobility
is about to start from yourtown. At EXPO 2025 OSAKA,KANSAI, visitors will be able
to enjoy a new experience
using air taxis, including asightseeing flight aroundthe venue, Yumeshima, andairport shuttles between thevenue and airports.

© Volocopter

Employee’s Commitment

Maintain safety and security in new air mobility

57

JAL REPORT 2021

Seeing off a charter flight for an elementary school

Local specialties delivered to the customer’s home

■ Making memories with “Air Travel”

As various school events were conducted in different forms in the
pandemic, we assisted in providing memorable school trips to various
destinations with innovative ideas of safe and secure air travel.
In Hiroshima Prefecture, a local mascot character cheerfully sent off
the students at the boarding gate and handwritten messages written
by JAL employees were placed inside the seat pockets. On the plane,
the students clapped with glee to the many surprises prepared by JAL
Group employees, and we received many messages of thanks fromthe teachers and students.
For schools in Niigata and Chiba prefectures, where school
excursions were cancelled, we operated a sightseeing flight andlet them experience the excitement of air travel by making flightannouncements, taking photos from the plane, and using in-flightentertainment equipment. With the cooperation of customs and the
airport building, they had a simulated experience of going throughimmigrations with passports handmade by airport staff. In Ishikawa
Prefecture, we operated a sightseeing flight above the students’school as well as above Mt. Fuji.
In addition, the students observed the airline industry behind-thescenes by watching ground handling vehicles at work, experiencing
check-in duties, and listening to lectures by cabin attendants andmaintenance engineers.
The JAL Group will continue to promote initiatives using the creativeideas of our employees to bring more smiles to people’s faces.

Data Book

Driven by major changes in values brought about by COVID-19, the JAL Group is
preparing to commercialize new air mobility such as drones and eVTOLs.
The most important thing about aerial vehicles is ensuring safety. In 2020, we
opened JAMOA (JAL Air Mobility Operation Academy), a drone operator training
program utilizing our know-how in airline pilot training. We hope to create safe andnew air mobility by combining the know-how in operations that we have cultivatedin the airline business, such as safety management, aircraft maintenance andoperations control, and new eVTOL technology, and create a prosperous society
where everyone can live comfortably anywhere as they please.
Based on the shared commitment of all JAL Group employees to deliver safety andcomfort in air travel, we will promote the practical use and expansion of air mobility.

Cabin attendant explaining via the screen

Medium Term Management Plan

We are conducting studies on thecommercial viability of logistics drones
to solve regional issues in rural cities.
In October 2020, four companies
including Japan Airlines signed apartnership agreement with Setouchi
Town (Amami-Oshima) with the aimof solving regional issues in outlying
islands using drones. We plan to
conduct demonstration tests usinglarge drones.

Air taxi service using eVTOLs

The domestic version of JAL Online Trip is an online
travel service that combines a “digital flight” guided
by JAL Group crew and “live broadcasting” from thedestination. One of the features is that customers canenjoy the charms of various regions with their five senses,
that is, see and hear images of the actual place and eat,smell, and touch local specialties delivered to their homes.
Another feature is that JAL Group employees who areassociated with the destination appear on the program.
In the Online Trip to Kushiro in Hokkaido under the theme“Ainu culture and salmon,” the customers enjoyed playing
the “mukkuri,” a traditional Ainu musical instrument,
which was delivered to their homes in advance, andtasting local specialties such as salmon ruibe (half-frozen
sashimi) and salmon roe marinated in soy sauce with
explanations from experts in the region.
Going forward, we will continue to provide regional
charms and values in a variety of ways using thelatest technologies, revitalize regions, and create new
touchpoints and communications with our customers.

The JAL Group Value Creation Story

Toward an Air Mobility Revolution■ Online trips

Foreword

In order to develop next generation air mobility and createa prosperous and sustainable society, we are working tocommence the drone logistics business in fiscal 2023 andthe air taxi business in 2025, including studies and trials on
the practical and expanded use of eVTOLs, in partnershipwith developers, Volocopter GmbH of Germany and Bell
Textron Inc. of the U.S.

# What We Can Do Now

TANAKA Shuji
Air Mobility Business Creation
Department
Digital Innovation

Touring a maintenance center online in the Museum of
Aeronautical Sciences

JAL REPORT 2021

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Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Safety and Comfort
Measures to Offer Comfort

All JAL Group employees always act with awareness that safety is the basic foundation of business. As a leading company
in safety, we will continue to bolster our efforts to increase our safety layers to prevent unsafe events.
In addition to safety initiatives directly related to aircraft operations, we will contribute to creating a safe and securesociety by addressing social issues and environmental changes. For this purpose, we will collect a wide range of internaland external information, improve analytical skills using digital technology, strengthen partnerships with manufacturers
to increase flight safety, heighten aviation security against increasingly diverse terrorist threats, develop next generation
air mobility, and adapt to changes in the environment such as infectious diseases. Furthermore, we will foster safety
awareness by continuously passing on lessons from past accidents and thoughts on safety to the next generation, and todevelop safety professionals who always act on the basic foundation of safety.

The JAL Group aims to offer comfort to our customers
and create a prosperous future that brings smiles toeveryone.
In post-COVID-19 air travel, in addition to providing highquality essential services with top priority on safety andcomfort, we will offer personalized products and services
by launching “Personalized Concierge” service which
combines digital technology and human resources.

We will also provide new financial and e-commerce
services in the customers’ everyday lives and life stages
through building strong relationships with regions andother companies.
We will create a new customer experience that delivers
personalized value in both air travel and daily life, andprovide “Tailored Comfort” to suit each customer inevery situation.

Foreword

Measures to ensure safety

Create a Safe and Secure Society
Accumulate safety layers and create a safe and secure society as a leading company in safety

Create a new customer experience in air travel and on the ground

Safety Measures in Flight Operation

Prevention of Infectious Disease■ Safety of Flights and Aircraft■ Touchless solutions andsocial distancing

Advances in aviation security equipment● Establish safety management in the air
mobility field●●●

Expand JAL SMART AIRPORT
Use digital certificates to support safe
and secure transportation

Air
TravelPersonal Concierge
Human services and digitalcommunication tailored for eachcustomer

Expansion of Opportunities
to Use Mileage* JAL FlySafe Measures for infectious diseases

https://www.jal.co.jp/jp/ja/info/2020/other/flysafe/

Greater opportunities to “use” and “accumulate”
miles by increasing JMB partners

Daily Life

Services in Financial andCommerce Fields
New business development leveraging thecustomer base and mileage program

Choices suitable for diversification ofmarket utilizing LCC, alliances and business
jet, etc.

Human
Resources
Technology
Partnership

Expansion of JAL SMART AIRPORT& Mobile Communications
Offer airport and in-flight services on
personal devices

Goods and Services for SDGs
Choice of services leading to the reduction of food loss,
contributing towards regional revitalization with new services
and improved accessibility to promote universal travel

Collaboration with Communities/MaaS

Creation of new styles of travel
Expansion of sales local specialty products
Seamless cooperation with othertransportation modes, etc.
Data Book

Human Resources for Safety Management

Address Diverse Needs

Best-in-class In-flight Services
In-flight comfort in the state-of-the-art
cabin of A350-1000

Medium Term Management Plan

Systems to prevent injuries in turbulence● Failure prediction combining maintenanceexpertise and new technologies (AI/data
analytics, etc.)●■ Strengthen aviation security
and adapt to environmental
changes

The JAL Group Value Creation Story

Safety and Basic Quality

Advanced Safety Measures Utilizing Digital Technologies

Offer personalized values through digitalization and build
relationships with people and regions■ Human resources who think and act on the basic
foundation of safety●

Expand safety education to learn from past accidents based on theThree Actuals Principle (actual place, actual object and actual people)●

Improve on the employee assistance program, a counselingservice for employees with personal difficulties including mental
and physical health problems, and create an environment where
employees can focus on safety

Providing “Tailored Comfort” to each customer in every situation* Details of JAL Group safety initiatives can be found in the JAL Group Safety Report.

59

JAL REPORT 2021

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60

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Human Resources Strategy
Foundation of
Human Resources
Supporting Growthand Development

JAL Philosophy・Divisional Profitability Management System
JAL OODA*

Health Management* OODA: Observe , Orient, Decide, Act ..... four elements required to respond to changes proactively

Executive Officer
Senior Vice President, Human Resources Management

Full Utilization of Surplus
Workforce/
Human Resource
Development for Regrowth

Leverage the activities and challenges of diverse human resources torealize “JAL Vision 2030”

Acquisition of knowledge througheducation and training● Secondment to deepen expertise●Achieving High
Productivity withEnvironmental
Changes
as an Opportunity

Achieve sustainable growth and development through the united efforts of the JAL Group●●

Utilizing digital technology
New Normal Workstyle

Productivity
by capita

Headcount
Maintain the FY2023 level

Collapse in Demand
FY2019Deployment of
Human Resources to
Growing Fields &BU-based Operation

FY2020Demand Rebound and Growth
FY2023■ Human resources mainly placed on FSC, being anactive role in growing fields■ Achieving growth in non-FSC business domains
through independent BUs

FY2025

Existing
businesses(incl. FSC)

Deployment togrowing fields
Existing
businesses(incl. FSC)

Until now From now on

Goal

Value Maximization of
Employee Experience (EX)Data Book

actively transfer staff to new domains. By promoting personal
growth through these measures, providing know-how for
working in multiple domains, and offering diverse work
opportunities and environments, we aim to improve individual
productivity in the recovery phase led by strong demand.
Furthermore, to ensure that diversity is reflected in important
corporate decision-making, human resources in and outside
Japan with diverse knowledge and experience will be appointed
to management posts, regardless of where or how they were
employed to accelerate diversity at the leadership level.
Furthermore, we will promote cross-functional transfers withno limit to job category in order to encourage diverse humanresources to play active roles, and in support departments,
use IT and new location-independent workstyles to enableefficient human resource management.
◆ Shift human resources to growth domains andestablish an operating system for each businessIn order to adapt to market changes caused by the
pandemic, we need to urgently promote growth of non-FSC
domains. We therefore reviewed our organizational structure
and clarified responsibilities for business and performance ineach domain. Looking ahead to growth after the recovery
phase, we will shift human resources, for example, in the
FSC domain to new growth domains.
Through these efforts, the JAL Group will work as a team toachieve sustainable growth and development.

Cross-sectional deployment
regardless of job category● More efficient use of
back-office●Medium Term Management Plan

The global spread of COVID-19 has rapidly changed people’svalues and behavior. Against this backdrop, the JAL Groupwill clarify and deepen fundamental initiatives and accelerate
human resource and organizational initiatives in order toachieve sustainable growth and development with society.
◆ Human resource base for growth and development
On firmly instilling JAL Group’s universal foundations,
namely the JAL Philosophy and the divisional profitability
management system, we will continuously promote
employee wellness and develop autonomous employees who
think and act for themselves, thereby solidifying the humanresource base and organizational base that will support our
growth.
◆ Seize opportunities brought about by environmental
changes to improve profitability
Meanwhile, the rapid decline in air transport demandhas created staff redundancies. In this severe businessenvironment, we will seize opportunities brought about
by environmental changes to invest in human resources*in order to accumulate knowledge and experience ofour diverse workforce and accelerate value creation andproductivity initiatives.
Specifically, we are improving education and training,making maximum use of staff whose roles have been maderedundant, expanding areas in which our employees can play
an active role through internal and external secondments, andAchievingHigh Productivity

Promotion of D&I

The JAL Group Value Creation Story

Human resources are a source of value creation for the JAL Group and a driving force for achieving sustainable growth anddevelopment. We will respect the diverse individuality and autonomy of our employees and actively implement initiatives
to promote personal growth.
Although the current situation remains uncertain, we will treat environmental changes as opportunities to create a safe andsecure society and a sustainable future as articulated in “JAL Vision 2030” through the joint efforts of all employees.

Foreword

SAEDA Naohito

Improving Corporate Value/
Sustainable Growth and Development

Measures and initiatives related to ESG strategies such as D & I are described on pages 87-96.

* Human resource investment policy

The JAL Group has established a system linking important human resource development processes such as recruitment, allocation, performance review, and training in order to maximize
human resource value. We have pursued workstyle innovation to enable diverse human resources to work with motivation regardless of gender, nationality, age, or other variables, andhave actively invested in office environments and digital devices. We will continue to actively invest in creating environments to nurture human resources and utilize individuality to create
new value and improve productivity.

61

JAL REPORT 2021

JAL REPORT 2021

62

Chapter2

Medium Term Management Plan

Business Strategy

Business Domains｜Safety and Comfort｜Human Resources Strategy｜Digital and IT Strategy

Finance Strategy

ESG Strategy

Digital and IT Strategy
Digital and IT Strategy

Value Maximization of

Value Maximization ofCustomer Experience(CX)

Employee Experience
(EX)

Human
Resources

Connect organizations
to encourage
autonomous actions
for higher
productivity

Technology

NISHIHATA Tomohiro
Managing Executive Officer
Senior Vice President, Digital Innovation

Foreword

Connect various
touchpoints aroundcustomers

Digital Transformation (DX)Japan Airlines opened the JAL website, jal.co.jp, in 1995, and became the first airline in Japan to offer online ticket
reservations the following year. In 2017, we renewed and laid the groundwork for a passenger service system for the firsttime in 50 years and promoted DX.
Going forward, we will continue to provide new services such as mobile apps and innovate business models with speed
using our innovation platform built by diverse human resources while expanding partnerships with external partners.

■ Expansion of Mobile

Continuous Improvementof Employee Experience
Digitalization■ Personal Concierge

Communications■ Diversity and High

Productivity

The JAL Group Value Creation Story

Collaborating with people outside the company to promote digitaltransformation (DX)

Providing New Customer
Experiences■ Safety and Basic Quality

Next-gen IT platform
IT Platform as a Backbone of theBusiness Strategy

Human Resources X Technology to Promote DX

63

JAL REPORT 2021

◆ Promoting DX
We have created “Sozo-no-Tsubasa” (Wings of Creation),
an intra-entrepreneur contest for employees to challengethemselves in new domains, opened the JAL Innovation Lab
as a base for creating new value and new businesses, andbuilt JAL Innovation Platform using the JAL Innovation Fundfor investing in startups inside and outside Japan to assemble
internal and external knowledge. In these ways and more, wewould like to put more effort into expanding open innovationin collaboration with people and organizations outside thecompany and create new value, using our human resource
capabilities and combining human resources and technology
to promote DX.

Maximize CX
Before departure

AirportJET

Mobile app

After arrival

Facial recognition Self-ordering systemwith mobile devices

MaaS

Autonomous
wheelchair

JAL Innovation Platform
Key technologies
AI

Quantum
computer

5G

Partners:

Lab Alliance:

Digital Twin

12 companies

About

300 companies

Data Book◆ Building next generation IT infrastructure
In building IT infrastructure, which will become increasingly
important in the future, we will heighten security to ensurestable system operation, use cloud technology to grow new
businesses, and improve data infrastructure which supports
DX.

◆ Digitalizing business processes
To maximize CX, we will develop smart mobility solutions using
mobile services. We will also develop MaaS (Mobility as a Service)
for supporting a seamless journey, which we first provided in
Hawaii, and offer personalized service and multilingual support
based on customer data.
At airports, we are working to offer remote customer service
using our avatar robot JET, lounge access with facial recognition,
self-order menus with mobile devices, and barrier-free mobility
on an autonomous wheelchair.
To maximize EX, we are using AI and RPA (Robotic Process
Automation) to improve productivity and efficiency, training crew
and maintenance engineers using Digital Twin (a digital replicaof an object such as a jet engine), upgrading operations basedon integrated flight data, and developing failure prediction using
big data and AI.

Medium Term Management Plan

◆ Digital and IT Strategy
The goal of DX is to maximize the customer experience (CX)
by delivering new value and unparalleled services, as well as
maximizing the employee experience (EX) through workstyleinnovation to improve business quality and productivity.
To achieve this, the Digital Innovation Division was establishedin April 2021 to integrate DX functions in the JAL Groupand implement DX across all functions. At the same time,
the Steering Committee for the Promotion of Digital
Transformation, comprising directors from 14 divisions, wasestablished to check progress of DX projects, discuss issues
and priorities, and establish a decision-making system.
Achieving these goals requires speedy execution of
investments in three layers: building next generation IT
infrastructure, digitalizing business processes, and promotingDX.
By steadily implementing these investments, we will evolve
intellectual capital; diverse know-how in services, technology,
IT systems, to a higher level in all domains.

xR

IoT

Robot

Innovation Fund:
USD

70 million

Lab members:

320(cumulative total
since 2019)“Sozo-no-Tsubasa”(Wings of Creation):

310 persons(total since 2017)

JAL Innovation Lab established in 2018

Japan Airlines was selected as a DX Brand 2021, a joint initiative of
the Ministry of Economy, Trade and Industry and the Tokyo Stock
Exchange, in recognition of our DX promotion system and efforts todeepen current airline services and develop new businesses.

2018
IT Japan AwardGrand Prix

2019
IT Best Award

2021
DX brandJAL REPORT 2021

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Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

Finance Strategy
Rebuilding financial foundation
Management resources are allocated strategically toward enhancing risk tolerance andimproving capital efficiency at the same timeKIKUYAMA Hideki

We will accomplish rebuilding financial foundation as we committed toward
post-COVID growth
Liquidity
Enhancement of Risk
Tolerance and Capital
Efficiency
Enhance risk tolerance● Maintain and improve financing
capabilities● Improve capital and asset
efficiency

FY2021〜2023

FY2024〜2025

Secure the amount of 5.0~5.6
months worth of passenger revenue

Maintain the same level

The JAL Group Value Creation Story

The spread of COVID-19 infection drastically changed our business environments, but we have a solid corporate culture thathas been developed through revenue and cost management based on divisional profitability management system. We will
improve our performance all together by improvement of productivity and efficiency and further cost reduction throughgroup-wide business restructuring with the COVID experiences. Conducting those measures, we will retrieve robust financial
foundation by fiscal year 2023 for realizing further post-COVID growth.

For liquidity, we set an appropriate level of liquidity as 5.0〜
5.6 months of passenger revenues, considering sufficienttolerance for refund risk that is associated with passenger
revenue size which varies largely when any event risk occurs.
We will maintain that amount of liquidity using credit line toaccomplish risk tolerance enhancement and capital efficiency
at the same time.

Foreword

Representative Director,
Senior Managing Executive Officer
Senior Vice President, Finance and Accounting

During the first three years in the Mid-term Management
Plan, we will focus on rebuilding our financial foundation thathas been damaged by the spread of COVID-19 infections torecover solid financial foundation by fiscal year 2023. Then,we will conduct growth investment actively toward sustainablegrowth from fiscal year 2024 toward revenue growth andcorporate value increase. We will pursue risk tolerance
enhancement and capital efficiency at the same time.

(incl. credit facility)

Leverage

Maintain the same level

Recover the equity ratio to c. 50%●

Toward enhancing risk tolerance and improving capital efficiency at the same time
◆ Measures during the COVID infection

This is the second COVID-year this year but even if the COVID
infection continues, we have secured sufficient financial
foundation for the prolonged COVID effects. Going forward,
we will conduct thorough cost reduction and investment
management to minimize monthly cash outflow and financesufficient liquidity trough our financing capability based on
our solid financial foundations.

65

JAL REPORT 2021

Allocation of Resources
Observe financial discipline● Allocate resources optimally● Promote investment forsustainable growth●

Shareholder Return
Dividends with focus on stability
and consistency● Payout ratio: 35% or higher● Flexible buyback to enhance
total return ratio●

Capitalefficiency

ROIC*1 > 9%
ROE > 10％Maintain or improve

Capitalallocation

Prioritize rebuilding the financial
structure

Promote investment forsustainable growth

Discipline

Dividend

Secure sufficient free cash flow for each fiscal period

Aim to resume dividends as earlyas possible

Stable dividend with payout
ratio over 35%

Total return

Flexibly consider buyback*1: Return on Invested Capital ＝ EBIT (after tax) / Average fixed assets at the beginning and end of a fiscal year(*2)*2: Fixed assets ＝ Inventory assets ＋ Non-current assets − Deferred tax assets − Net defined benefit asset

Set an appropriate level of liquidity as 5.0〜5.6 monthsof passenger revenues after the COVID-19 pandemic
Secure liquidity that will enables us to tolerate risks according to the sizeof passenger revenues subject to potential significant impacts if any
event risk occurs● Secure an appropriate level of cash and deposits considering asset
efficiency●

Working capital＋Repayment/
Investment

Data Book◆ Steady cost control and sufficient liquidity
securement

The JAL Group has been focusing on efficiency, instead ofsize, to establish management structure with risk tolerance.
In this prolonged difficulty, it is time for us to show ourtolerance. Yet, we believe that air demand to/from Japan
will grow in a mid- and long-run in spite of the temporary
decrease caused by COVID-19. The JAL Group will continue tocope with this unprecedented difficulty by taking appropriate
measures to increase revenue and decrease costs as muchas possible. Those measures include appropriate capacity
adjustment, revenue maximization amid the boosted cargodemand, and demand-stimulating measures. We will improve
our profitability as air passenger demands recover, and thenwe will accomplish rebuilding financial foundation as soon
as possible and conduct growth investment with financial
disciplines toward sustainable growth to increase ourcorporate value.

Obtain “A” rating

Medium Term Management Plan

Fiscal year 2020 was a very tough year for the airline industry
due to the expansion of COVID-19 and consequently, air travel
demand still remains at low level. In the difficult businessenvironment, we will improve profitability by variable cost
reduction through swift capacity adjustment and investment
reduction, together with other cost reduction such in-sourcing
operations instead of outsourcing, reducing IT expenditureand reducing personnel cost including executives’ salaries
and employees’ bonus cut, and reduction of investment.
The Japanese government is providing its supports including
deferral or exemption of landing fees and jet fuel tax toassist the airline industry or special measures for employment
subsidies. We will use those supports as much as possible. We
would like to show our sincere gratitude for the supports.

◆ Toward rebuilding financial foundation andsustainable development

Credit rating

Preparation for event risks
Liquidityon hand

Fixed Cost
Spending until
Financing
Refund ofIssuedTickets

Creditfacility

JAL REPORT 2021

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Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

Toward shareholders return and growth investment
We will scrutinize investment during the financial foundation rebuilding period, andthen will actively conduct shareholders return and growth investment

Path to Profit Growth
EBIT: [JPY Bn]
Network
Expansion

Profit growth ineach domain

170c. 185

16

10

12

43

89
FY2019Recovery

FSC/Cargo

LCC

EBIT Margin

Financial

Mileage etc.

2023

The JAL Group has been conducting disciplined costmanagement through divisional profitability management
system for thorough cost reduction. We are coping withdecrease of passenger demand caused by the spread of
COVID-19 by swiftly adjusting our capacity to minimize
variable costs for appropriate cost control. Also, out of thetotal fixed costs, costs that may vary according to operational
size or the number of passengers and temporary or additional

Past Measures

10% or Higher in FY2023 (to improve onwards)

EPS¥260 Pre-COVID
level

•
•

FY2025c. ¥290

FY2021〜2023

FY2024〜2025

A Limited investments for rebuilding financial position
B Recover an appropriate level of liquidity by the endof FY2023

C Active shareholder return
D Investment for sustainable growth

Thorough structural reforms, followed by disciplined cost management
Fullest use of the divisional profitability management system for profitability improvement
through flexible adjustment of supply and cost reduction

The JAL Group Value Creation Story

9% in FY2023 (to maintain or improve onwards)
FY2023

costs that are associated with structural restructuring are
excluded to calculate actual fixed cost. The actual fixed cost in
fiscal year 2020 was 500 billion yen, 60 billion yen down fromthe previous year. We will maintain this 500 billion yen level ofactual fixed cost for later years by steady cost control throughbusiness restructuring and improvement of efficiency andproductivity.

2025

ROIC

Shareholder Return

Flexible variable cost management and fixed cost reduction through structural reforms
and further streamlining and productivity improvement

Foreword

Recovery fromCOVID-19

Actual EBIT(IFRS)FSC Profitability
Cargo Revenue
Increase

Expansion ofBusiness Domains

Cost management

Post-COVID

C Shareholder
ReturnOperatingCash flow

D

A Investment

Debt Financing

Repayment
B Debtand Increase in
Liquidity

Debt Financing

Debt Repayment

Cash Inflow

Cash Allocation

Cash Inflow

Cash Allocation

Investment

Variable
Cost

Flexible and swift adjustment of supply to control variable costs

Medium Term Management Plan

OperatingCash flow

Reduction of actual fixed costs* to the FY2020 level
through structural restructuring and further streamlining and productivity improvement

67

JAL REPORT 2021

the year-end dividend for fiscal year 2020 in order to secureliquidity at hand and maintain financial stability. We would liketo ask for shareholders’ understanding in this situation. During
the term of the Mid-term Management Plan, we will aim fordividends as early as we can, and while watching developmentof financial foundation rebuilding, we will aim for restart ofstable and continuous dividends and flexible share repurchase.
Also, we set our profit target at 170 billion JPY in fiscal year
2023 that makes our EPS equivalent to a pre-COVID level of
260 yen. We will achieve 10% EBIT margin and 9% ROIC in
fiscal year 2023 to make them equivalent to a pre-COVID leveland further maintain or improve those targets. We will strive
altogether to make sufficient profits that will recover dilution
caused by the public offering conducted in November 2020
and realize stable and continuous shareholder return.

■ Illustrative Reduction of Actual Fixed Costs*

Initiatives for Cost Reduction toOffset Cost Increase
Optimization of the fleet size
Improve productivity• More efficient operation with lessmanpower through adoption of JAL
SMART AIRPORT• Utilization of systems to improve cost
efficiency, etc.
•

Actual Fixed Costs
JPY ▼60 Bn

Fixed
Cost

Total
Fixed
Costs

•

ActualFixed
Costs*
JPY 560 Bn

JPY 500 Bn

FY20192020

Data Book

JAL regards shareholder return as one of our most importantmanagement matters. Our fundamental policy is to actively
implement shareholder returns through continuous andstable dividends and flexible share repurchases, while securing
internal reserves for investments for corporate growth in a
future and business environment changes and for building astrong financial structure.
The prolonged COVID-19 spread is affecting the JAL Group’s
short-term performance severely, nonetheless we believe it is
yet temporary and it does not cause fundamental changes toour profit structure, therefore we will not change the above
basic policy.
Unfortunately, the prolonged COVID-19 spread madepassenger demand recovery unforeseeable throughout
the fiscal year 2020. Considering the above situations, we
regrettably determined not to pay the interim dividend andMaintain the FY2020 level

2021

FY2020 reduction, JPY135 Bn from the initial plan(incl. some revenue- and capacity-linked portions)

2022〜* Actual Fixed Cost: (Total Fixed Cost) – (costs that may bevariable according to operational size and number ofpassengers, temporary or additional costs in association withthe structural restructuring (early retirement of aged aircrafts,
LCC business expansion, etc.))

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

Investment strategy

TOPIC

Dialogue with Stakeholders

We will advance effective investments with disciplined investment control
investments for “contactless” or efficiency improvement. The
average investment per annum is expected to be about 150
billion yen. From fiscal year 2024, we will enhance sustainablegrowth investment. The average investment per annum forthe latter two years is expected to be about 200 billion yen,which makes the total investment for the five years about 850
billion yen.

Events for Investors
Each year, we hold various events for investors such as individual meetings, briefings on the Medium Term Management Plan andfinancial results, IR DAY, small meetings with the CEO and CFO, overseas IR sessions for institutional investors, and presentations
for individual investors. In fiscal 2020, these events were held online to maintain close dialogue with market participants. Valuable
opinions are fed back to management, the Board of Directors and relevant departments to be reflected to Group management.
Going forward, we will further improve the quality of disclosure and dialogue and continue these IR events to increase corporate
value.

Foreword

Prior to COVID-19, we had invested more than 200 billion
yen annually toward the expansion of Tokyo metropolitan
area airport capacity. However, during the term of the Midterm Management Plan, we will focus on rebuilding financial
foundation and sustainable growth investments at the sametime. For the first three years till fiscal year 2023, we will
scrutinize investments such as introduction of fuel efficient
A350 to reduce CO2, LCC business enhancement or IT

IR DAY
5-year total: c. JPY 850 Bn

FY2021〜2023

FY2024〜2025

JPY220〜230 Bn/year

c. JPY 150 Bn/year

c. JPY 200 Bn/year(3-year total: c. JPY 700 Bn)(3-year total: c. JPY 450 Bn)(2-year total: c. JPY 400 Bn)

Consider non-organic
growth opportunities
depends on the statusof cash flows

Other

Aircraft
Aircraft

Introduction of A350-900 todomestic routes• Increase in FSC international
aircraft• Renovation of passenger
service systems•

Targeted investment withrestrained size:
Continuous introduction of
A350-900• LCC business• DX promotion, JAL SMART
AIRPORT•

Sustainable growth through:Introduction of A350-1000
into international routes• Expansion of businessdomains• Promoting initiatives toachieve SDGs•

Presentations and briefings for individual investors
In August 2021, we held a briefing for individual investors, which wasattended by more than 100 people. Representative Director, Executive
Vice President Shimizu provided basic background information about
the company and explained the Medium Term Management Plan and
COVID-19 initiatives including episodes on the frontline. We received
positive feedbacks from many participants that our corporate culture ofproactive work behavior even during the pandemic has filtered throughthe company. Also, they replied that their impression of JAL Group was
improved. We will continue to provide opportunities for further dialogue
with individual investors.

* Presentation material in Japanese
Data Book

Investments for “development at
Haneda and Narita” in FY2020

Medium Term Management Plan

Other

The JAL Group Value Creation Story

FY2017〜2019

IR DAY has been held annually since 2017, and it was held in May 2021 for investors and analysts. In addition to dialogue with
top management on the Medium Term Management Plan announced in May, we created opportunities for dialogue, centered onquestions and answers, with directors who are in charge of the full service carrier (FSC) business, low cost carrier (LCC) businesses,
and our new domains; Mileage and Lifestyle Business and Regional Business.
External Director Sonoko Hatchoji participated in the meeting, where she deepened investors’ understanding on JAL Group fromvarious perspectives through dialogue on corporate governance with investors.

Evaluation by external organizations
The JAL Group is working to build trusting relationships through twoway communication. Our proactive disclosure of information was
highly recognized by external organizations.
Received the IR Good Visual Award from the Japan Investor Relations
Association
Ranked No. 1 in the Transportation category for “Award for Excellencein Corporate Disclosure” sponsored by the Securities Analysts
Association of Japan
Click here for more information.

69

JAL REPORT 2021

JAL REPORT 2021

70

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

ESG Strategy
SDGs
Achievement

Promote ESG management to Achieve SDGs
by Specifying 4 Priority Areas, 22 Issues, and c. 180 initiatives to be Addressed
Hidetsugu Ueda

Promotionof ESGManagement

E

71

JAL REPORT 2021

G

Business
Activities

Promotion of D&I, improving
accessibility, etc.

GovernanceBusiness Domains
FSC/LCC/Cargo and Mail/Mileage,
Lifestyle and Infrastructure×

Transparent Management

AssetsHuman resources/knowledge andexperience/aircrafts/airport network/
financial base/customer base×

Fair Business Practices, etc.

Operational Base
Safety Charter / JAL Philosophy / Divisional
Profitability Management System / Code of
Conduct / corporate governanceSpecific Initiatives
All JAL Group employees promote workplace initiatives to achieve the Medium Term Management Plan.
Address to Climate Change● Engine washing ● Lightweight container ● Using SAF

First flight in Japan withdomestic SAF* in February
2021

Regional Revitalization● Flight path optimization● Collaboration● Workation

Promotion of D&I● Diversity● Consideration for Gender Neutrality* Sustainable Aviation Fuel◆ Supported by the unwavering efforts our employees
The unwavering efforts of every employee as well as
leadership by management are essential to driving
sustainability initiatives in diverse areas. We feel that an
engaged and conscious workforce, where diverse individuals
work energetically and achieve personal growth will lead tocorporate growth and continuous value creation, which isindispensable to society. It is important that our employees
have a “feel” of the relationship between their work and theSDGs; therefore, we are providing training and information
to raise awareness and taking the bottom-up approach toturn their ideas into SDGs initiatives.
The JAL Group will take action to achieve sustainable
development together with society and become “the world’s
most preferred and valued airline group” of our stakeholders.

Regional revitalization, etc.

Improving Accessibility

Formulation of guidelines
based on COVID-19 measures

Activities of Employees Success of Global
with Disabilities
human resources●Dedicated counter ●Technology Leveraged Support

Special assistance
Remote signcounterlanguage interpreter

Autonomous
wheelchair●Exclusive tour

Accessible
tourism

ChangeAnnouncement

Sneakers to the
ZIPAIR uniform●Transportation of●Non-face-to-face/

Speed &
Quality

JAL SMARTAIRPORT

medical items

touchless●Publicize regional

specialty products●Support for attracting

foreign visitors

Continuing activities from2011 to 10 Years andevolving into a businessPrevention of the Spread of Infectious Diseases
Put all the customers’ safety
and peace of mind first andoffer a new journey

Data Book◆ Foundation for ESG management
The JAL Group Medium Term Management Plan positions
ESG strategy as one of the pillars of strategic management
for promoting ESG management and achieving the SDGs.
“JAL Vision 2030” espouses the central, transformative
promise of the SDGs, “Leave no one behind,” and ourcommitment to “realize an affluent society where eachone of us can sense and hope for a brighter future.” Our
employees base their actions on the JAL Group Corporate
Policy, the JAL Philosophy and the JAL Group Code of
Conduct “Commitment to Society”, and fully understandthat “Each of us makes JAL what it is” and “Today will bebetter than yesterday and Tomorrow better than today.” This
is JAL Group’s strength and the driving force for addressing
social issues and contributing to the betterment of society.

◆ ESG promotion system
In order to further promote ESG management, we haveestablished the Sustainability Promotion Council chaired by
the President to raise the bar on our sustainability initiatives
including addressing climate change and respect for humanrights. The Council sets numerical targets and KPIs in eachpriority area and issue and conducts progress management
and reviews. The Board of Directors has also strengthened
its function to achieve sustainable increases in corporate
value, such as holding in-depth discussions on sustainability,
long-term issues and visions. Going forward, we will provide
external stakeholders with more opportunities for dialogue
in order to incorporate social trends in our initiatives in atimely manner and improve proactive communication of oursustainability approaches and initiatives.

Contribute todevelopment of regional
communities as social
infrastructure

S

Medium Term Management Plan

◆ JAL Group’s business environment
The COVID-19 pandemic has not only changed lifestyles but
also posed unprecedented challenges to society. It was ayear where we more strongly felt the importance of securingtransportation for the circulation of people and goods
necessary for daily life. Furthermore, we felt the importanceto accelerate our efforts to address social issues, such as
infectious diseases and climate change. At the same time, wewill seize this opportunity to actively contribute to creating asustainable society through our business, such as improving
public hygiene through the transport of medical supplies andrevitalizing regional areas by expanding sales channels for
local specialties.

Communities

The JAL Group Value Creation Story

Creating a sustainable society through our business

PeopleContribute to build asociety where everyone
demonstrates one’ potential

Address to climate change, effective
use of limited resources, etc.

Towards a future where each one of us can sense and hope for a brighter future
There is growing momentum to achieve a sustainable society including the SDGs and true prosperity and happiness.
In order to further promote ESG management through our business, we announced “JAL VISION 2030” to declare ourcommitment to “realize an affluent society where each one of us can sense and hope for a brighter future.” We haveidentified priority issues in four areas; Environment, People, Communities, and Governance, and will take action to solve
social issues and create a sustainable society with a view to achieve the SDGs by 2030 and net zero CO2 emissions by 2050.

Environment
Preserve environment topass on the precious Earth
to the next generation

Foreword

Managing Executive Officer
Senior Vice President of General Affairs
Chair of Sustainability Promotion Committee●Heightened

hygiene standards

Antiviral andAntibacterial Coating

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Main Initiatives and Medium-Term Targets for Sustainability

Promotion System

The JAL Group has set medium-term targets for eachof the “4 priority areas and 22 priority issues” andwill promote ESG management to achieve the SDGs
through our business and create a sustainable society.
Through extensive discussion by management, taking
into account global trends, stakeholder expectations,
impact on business, the importance of Group goals on
management, and the opinions of external experts, 4priority areas were identified (CO2 emission reduction,

This fiscal year, we developed a system to accelerate ESG management
toward achieving the SDGs by establishing the Sustainability Promotion
Council*1 chaired by the President and monitoring progress by the Boardof Directors.
The main agenda items of the Sustainability Promotion Council are as follows.

reduction of single-use plastic, increase ratio of female
managers, regional revitalization) and established aspriority issues in the Medium Term Management Plan.
Going forward, we will disclose our achievements eachyear, expand the scope of our initiatives, and accelerate
ESG initiatives.
For more information, please visit the JAL website.

President
Sustainability Promotion Council●

Meets twice a year
in principle, andwhenever necessary
to the agenda

once
Sustainability Promotion Committee Meets
a month in principle

Foreword

https://www.jal.com/ja/sustainability/

Progress management of priority issues and annual targets of sustainability
initiatives● Reviewof risks and opportunities of climate change● Reviewof the Environmental Management System● Reviewof human rights due diligence

Board of Directors

Sustainability Promotion Vice Presidents Meeting Meets once a month

Furthermore, the Sustainability Promotion Committee* under Sustainability
Promotion Council holds monthly meetings, where the directors check anddiscuss the progress of initiatives.
2

Sustainability Staff Meeting

Meets once a week

*1: The council aims to create “an affluent society where each one of us can sense and hope for a brighter future” as set out in “JAL Vision 2030” and achieve sustainable development
Management
Management targets in the Medium Term Management Plan
targets

Priority
Priority issues in the Medium Term Management Plan
issuesPeople22 Issues

Main initiatives

Addressing Climate Change Reduction of CO2 emissionsManagementtargets

Priority
issuesReducing single-use plasticManagementtargets

Priority
issues

Effective Use of Limited
Resources

Priority
issuesReducing food loss and wasteTarget for FY25

22 Issues

Aircraft Operation：Below 9.09 million tons
Ground Facility: [FY2030 Target] Emissions vs FY2013
50%
No use of virgin petroleum plastic in cabin/lounge
100% switch to eco friendly materials at Cargo/Airport
service

Promotion of Diversity andInclusion (D&I)

Prevention ofEnvironmental Pollution

Industrial waste reduction

Final disposal rate: Keep below 1%

Noise Reduction

Operation with low-noise aircraft

Ratio of ICAO Chapter 4 standard compliant aircraft:100%

Prevention of illegal wildlife trade

Number of illegal wildlife transported:0 times

Use of certified products

Ratio of paper items with FSC® certified paper used inflight:100%

Biodiversity Conservation

Communities

Priority
issuesHealth and Productivity
Management

Group Female Managers Ratio: 30%

Improvement of working productivity

Total work hours:1,850 hours

Promotion of diverse workstyles

Cumulative total number of people who used systems towork remotely: Track usage statistics

Improvement of health check-up participation rate Ratio of check-ups taken by employee: Keep 100%
Ratio improvement of gynecological checkups

Ratio of breast cancer check-up taken: 70%
Ratio of uterine cancer check-up taken: 70%

Respect for Human Rights

Conducting of Human Rights Due DiligenceSpecification of issues and conducting of improvement
plans

Human Resources
Development

Enhancement of employee training

Tracking training hours per person

Improving Accessibility

Promotion of boarding passengers
who feel barriers to travelling

Priority
issuesRatio of such passengers onboard: 2.5 times v.s. FY19 result

Prevent the Spread of
Infectious Diseases

Activation of medical items transportation

Priority
issues+50% v.s. FY19 result

Main initiatives

Route Network Expansion

Preserving and development of regional routes
including island routes

Target for FY25
More than 62 sites

Increase Inbound Tourism

Promotion of passengers from outside of Japanboarding on domestic flights:

1,505,000 people

Improving Convenience inTravelCommercialization of drone logistics/
eVTOL air taxi service

FY23: commercialization of drone logistics
FY25: commercialization of eVTOLs

Regional Revitalization

Increase of tourists to regional
areas

Managementtargets

Priority
issues22 Issues

Promotion of volunteerism
Nurturing the next generation

Track participation in programs

Disaster relief

Track the value of charity miles donatedTarget for FY25
Priority
issuesKeep 100% compliance rate

Function improvement of Board of Directors

Ratio of Outside Directors: Over one third

Prevention of information leakage

0 casesPrevention of corruption and bribery

0 cases

Disclosure

Reinforcement of information disclosure in
Sustainability pages of the Corporate website

Number of views: Over 1,000,000

Responsible Procurement

Supply chain management

Promotion of BCM

Improvement of BCP effectiveness

Fair Business Practices+10% v.s. FY19 result
Track participation

Main initiatives
Compliance to the Corporate
Governance Code

Data Book

22 Issues

JAL REPORT 2021

Managementtargets

GovernanceCommunity Relations

73

Promotion of diverse talent
participating actively in work

Target for FY25

Medium Term Management Plan

Paperless in cargo warehouses: Complete paperless in JAL
flights

Main initiatives

Workstyle Innovation

Recycle rate 100%

Paper reduction

Disaster Restoration
AssistanceRegional Vitalization, and Human Resources. Other officers may be invited to attended meetings depending on the agenda items/issues to be discussed in the meetings.

The JAL Group Value Creation Story

Environment

together with society, through ESG management in all priority areas and priority issues of the JAL Group, the aviation industry and society aimed at achieving the SDGs.

*2: A steering committee to implement the PDCA and promote SDGs initiatives, comprising officers in charge of General Affairs, Corporate Planning, Procurement, Customer Experience,

Priority
issuesSoundness confirmation ratio of primary suppliers: 100%
Number of exercises conducted per BCM: 2 times

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Environment
Basic Concept (JAL Group Code of Conduct)

Priority issues

Addressing Climate
ChangeInitiatives●●

Prevention ofEnvironmental Pollution●●●

Noise Reduction

●

●

P.85
https://www.jal.com/en/sustainability/
environment/noise-reduction/

P.85-86https://www.jal.com/en/sustainability/
environment/biodiversity/

https://www.jal.com/en/sustainability/codeofconduct/

Plastic materials used in cargotransport

Environmental Management
Earth to the next generation, the JAL Group has establishedthe Environmental Policy and a promotion system and is
working to protect the environment as a corporate citizen
and prevent events that may hinder this.
https://www.jal.com/en/sustainability/
environment-management/policy/

ReportManagement
review
Decision-making,appointment(Senior Vice President of General Affairs)
ReportSecretariat

Instruction

Environmental Management System (EMS) to promote
environmental preservation activities appropriately andefficiently while making continuous improvements.

Sustainability Promotion
Council(EMS cases discussed at least biannually)

Members: President, all officers
including EMS Director
Agenda topic of discussion:
Approval of medium- and long-term
environment goals, deliberation on
EMS operational status, etc.

Sustainability Promotion
Committee(EMS cases discussed at least biannually)

Members: Relevant officers, EMS
Director
Agenda topic of discussion: EMS
progress management, problem
sharing, etc.

(ESG Promotion Department)
ReportGroup companies

Divisional EMS Managers(Vice Presidents of Administration)
EMS
supportReport(appointed in each division)75

JAL REPORT 2021

EMS Managers
Meeting(meets biannually)

Members: Divisional EMS Managers,
Chief of Secretariat
Agenda topic of discussion:
Establishing and reviewing divisional
annual targets etc.

EMS Staff Meeting(meets biannually)

Members: Divisional EMS staff,
Secretariat
Agenda topic of discussion: Concrete
initiatives, progress and problem
sharing, etc.

Appointment/
Instruction

Divisional EMS Staff in charge

IKARI Sumire

Information peg after recycling

Export and Mail Business Division
JAL Cargo Service

TOPIC

Biodiversity Conservation

Promoting registration asa World Natural Heritage Site
In July 2021, four Japanese islands, “Amami-Oshima Island,
Tokunoshima Island, the northern part of Okinawa Island andIriomote Island”, were registered as a UNESCO World Natural
Heritage. These regions, isolated from the mainland several
million years ago, have a diverse ecosystem providing habitats
for unique species such as the Amami rabbit, Okinawa rail,a species of bird and Iriomote wildcat only found here andnowhere else.
The JAL Group has been taking steps to support registration of
the islands since 2016. Japan Transocean Air (JTA) formed theWorld Natural Heritage Promotion Joint Association in 2019to support this movement through a public-private partnership
including local companies and organizations. JTA coordinatedwith the local government of the northern part of Okinawa
Island and Taketomi Town on Iriomote Island to preserve thenatural environment, promote regional development, andprevent overtourism after registration.

VOICE
Protect the rich natural environment andpromote the regional economy
In 2019, I was transferred to Taketomi Town on Iriomote
Island on a double assignment at JTA Yaeyama Sales Office
to mainly support the listing of the islands as a World
Natural Heritage Site. I have dealt with urgent issues ofthe local community such as drifting garbage and killingof the Iriomote wildcat and planned beach clean-up andweeding activities to protect the environment. I was deeply
moved when the decision was made to register the islands
as a World Heritage Site. It was the result of steady andunited efforts of the local
communities.
I will continue to use theperspectives and knowledgeof both the public andprivate sectors to meet thechallenge to protect therich natural environment
TAKAYASU Sota (middle right)
Ishigaki Airport, Japan Transocean Air
and promote regional
Note: The members posed as a wildcat after
economies.

Data BookEMS Director

Internal Audit TeamThe global spread of COVID-19 has halted the
movement of people, but the movement of goods that
support daily life has increased. As we can transport thecustomers’ “sentiments” behind their consignments,
we have worked over the past 40 years to provide
environmentally sustainable air cargo transport services,and through trial and error, use environmentally friendly
alternatives for plastic on the airport frontline in orderto make effective use of limited resources.
As we work on airport
frontlines that have directinteraction with customers,
we will look for ways ofcontributing to society andour customers and cooperatewith our partners to reduce
the environmental impact ofour business.

■ We have established, implement and maintain thehttps://www.jal.com/en/sustainability/environment/
environment-management/

President

From the frontline at Narita Airport

Medium Term Management Plan

■ In order to fulfill our responsibility to pass on the precious

VOICE

The JAL Group Value Creation Story●

Biodiversity Conservation

P.85
https://www.jal.com/en/sustainability/
environment/pollution-prevention/

The Cargo and Mail Division uses polythene sheets
for protection from water damage when transporting
pharmaceuticals, food and other daily essentials. Instead ofdisposing these plastic materials after transport, we haveprovided them, for 40 years, to Repro Co., Ltd., which
manufactures and sells recycled products such as boundary
pegs. Repro Co., Ltd. recycles plastic materials to turn theminto plastic products such as pegs with built-in IC tags, which
are installed in forests for landside detection and disasterprevention. The Cargo and Mail Division is working to create arecycling-based society, where recyclable resources are reused,by continuously providing materials to Repro Co., Ltd.
We are also working to reduce CO2 emissions during airtransport including material procurement by using recycledmaterials in polyethylene sheets for cargo transport, whichemit less CO2 in the manufacturing process.

Foreword(1)	Global environmental preservation initiatives
The JAL Group complies with laws and regulations and strives to respondto climate change, effectively use limited resources, prevent environmental
pollution, reduce noise, and preserve biodiversity in order to reduce impacts
of operations on the environment. Furthermore, we pursue the developmentof environmentally friendly technologies to solve environmental issues, incoordination with stakeholders.
(2)	Disclosure of environmental information and dialogue
The JAL Group actively discloses environmental information, maintains
dialogue with stakeholders and expands environmental preservation
initiatives to society.

Effective Use of Limited
Resources

P.83-84● https://www.jal.com/en/sustainability/
environment/limited-resources/●

Effective Use of Limited Resources

Plastic Waste
Recycling polythene sheets

P.77-82https://www.jal.com/en/sustainability/
environment/climate-action/

Passing on the precious Earth to the next generation(global environment)
We sincerely accept the fact that our air transport business impacts
the environment significantly. To fulfill our responsibility of passing
on the precious earth to the next generation, we raise awareness ofevery employee and preserve the environment in every aspect.

TOPIC

cleanup activities aimed at the conservationof the Iriomote wildcat.

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Environment

Addressing Climate Change
Climate change-related “risks” and “opportunities”

Basic Concept■ We are aware that taking urgent action tocombat climate change is essential for thecreation of a sustainable society.
■ In order to steadily promote climate change

initiatives, we announced our target to achieve
net zero CO2 emissions (hereinafter “net zero
emissions”) by 2050 at the General Meeting of
Shareholders held in June 2020.

■ In February 2021, we announced our support

for the recommendations of the Task Force on
Climate-related Financial Disclosures (TCFD) of
the Financial Stability Board (FSB), and in August
2021, made climate-related disclosures in linewith TCFD recommendations.
The JAL Group will continue to provide periodic
disclosures.

Items of risks andopportunities

Transition risks○ Policy/Legal○ Technology○ Market○ Reputation

Outline of impacts
Fuel-efficient aircrafts: In the short to medium-term, the steady implementation of the equipment renewal plan is expected to contribute to
the achievement of CO2 reduction targets. In the long-term, it is expected that small aircrafts with short flight ranges will be replaced by aircrafts
using new technologies such as hydrogen and electric power. However, delays in development of aircraft or airport infrastructure may affect therealization of net zero CO2 emissions in 2050.
SAF*1: In the short to medium-term, there are concerns about supply shortages and high procurement costs due to delays in development anddissemination. In the medium to long-term, there are concerns that the high prices of SAF and hydrogen fuel, which require large quantities offuel to be purchased, will have an impact on income and expenditure.
Emissions trading: In the short term, the impact of emissions trading based on the CORSIA system*2 is assumed to be limited due to a decreasein aviation demand caused by COVID-19. In the medium to long-term, along with the strengthening of CO2 emissions regulations in each country,
it is possible that the cost of purchasing CO2 credits will increase due to the rise in carbon prices.

Governance■ Governance structure
Effectiveness Assessment), it has been resolved that the Board of
Directors will deepen discussions on sustainability, including climatechange.
The JAL Group will strive to make continuous improvements byperiodically evaluating the impact of our business to the environmentand results of disclosed initiatives towards climate change and byimplementing the PDCA cycle to reflect to the initiatives.

Strategy

Operations: The effects against flight operations of changes in precipitation, weather patterns, and extreme weather events have already become
apparent in some areas, and may continue over the medium to long-term.

○ Acute○ Chronic

Demand: The outbreak of pandemic in infectious diseases caused by changes in ecosystems due to increase in average temperature, has thepotential to affect air transport operations in the medium to long-term.

Opportunities

Operation/aircrafts: Reduction of CO2 emissions and increase in profit due to improvement of fuel efficiency are expected through ingenuity indaily operations and technical innovation of aircrafts, and improvement of infrastructure including technological innovation of air traffic control inshort to long term.

○ Resource Efficiency○E nergy Source○ Resilience○ Markets○ Products andServices

SAF: In the medium to long term, the diversification of fuel supply sources by SAF dissemination may lead to improved reliability of aircraft fuelsupply chains.

The JAL Group Value Creation Story

In order to treat climate change-related “risks” and “opportunities”
as important management issues, JAL has established theSustainability Promotion Council headed by the president as the
Chair, and Sustainability Promotion Committee under the council
for deliberation and decision. The contents are reported to theBoard of Directors for discussion and evaluation. In accordance withevaluation of the effectiveness by the Board of Directors (the Board

Physical risks

Foreword

Demand: Although there will be limited impact of the modal shift on the international aviation sector, it may slow the growth of air passenger
demand in Japan in the medium to long term.

Demand: A certain degree of improvement in customer preferences is expected by responding to the diversification of customer needs for lowcarbon, environmental conscious products and services over the short to long term. It could also create new revenue streams by creating new
businesses such as next generation Air Mobility.

*1: SAF Sustainable Aviation Fuel
*2: CORSIA Carbon Offsetting and Reduction Scheme for International Aviation: a system which mandate airlines operating international flights to purchase CO2 emission credits for any excess CO2 emissions
in 2019, from 2021 onwards

Risk Management
Climate change has the potential to adversely affect the airtransport business, which is based on the premise of operating in a“safe and secure society,” and as a result, poses a significant risk tothe sustainability of the business. Furthermore, addressing climatechange through CO2 emission reduction by airlines may have avariety of financial impacts, including upgrading to fuel-efficient
aircraft and compliance with carbon pricing.
These factors affecting the JAL Group’s business are summarized
and discussed in accordance with the TCFD portfolio of climatechange-related risks and opportunities and are listed in the tablebelow. “Short-term,” “Medium-term,” and “Long-term” aredefined as follows.
Classification

Details

Short-term

Fiscal years 2021-2025 (applicable period of current
Medium-Term Management Plan)

Medium-term

Fiscal years 2026-2030 (Period until achievement of
the SDGs)

Long-term

Fiscal years 2031-2050 (Period until the JAL Group’s
achievement of net zero CO2 emissions)■ Risk Management System
Recognizing the risk of climate change as one of our priority
risks, risk management is conducted in accordance with global
laws, regulations and policy trends related to climate change,
while identifying risks in the PDCA cycle of the Environmental
Management System (EMS). They are reported to the Board of

Directors for discussion and evaluation.
The risk of climate change, both transition risk and physical risk,
are managed within the risk management framework of the JAL
Group as a whole.
https://www.jal.com/en/sustainability/governance/
riskmanagement/#risk

Data Book■ Risks and Opportunities

In 2018, the JAL Group participated in the “Support Project for
Scenario Analysis of Climate Risks and Opportunities in Accordancewith TCFD” supervised by the Japanese Ministry of the Environment(MOE), and with reference to the International Energy Agency (IEA)
and the Intergovernmental Panel on Climate Change (IPCC), we set 2
scenarios for the average rise in temperature to the end of this centuryof “below 4°C” and “below 2°C”, and looked at society in 2030.
Since COVID-19’s global outbreak, the international community
has begun to move toward a world with the 1.5°C scenario. This
includes deepening of the Green Recovery Program in Europe,
return to the Paris Agreement by the U.S., China’s net zero CO2emissions declaration by 2060, and the Japanese government’s
2050 net zero carbon emissions declaration and major revisions to
the NDC (Nationally Determined Contribution).
In the aviation industry, ICAO (International Civil Aviation
Organization) is currently studying a long-term CO2 reduction
target for 2050 based on the social demand for decarbonization. In
view of the fact that CO2 emission regulations in each country will
be tightened and emissions trading will become more prevalent in
the future, the JAL Group decided to aim to realize a world with a
1.5°C scenario, set a net zero CO2 emissions target to be reached
by 2050. We have incorporated it into the “JAL Group Medium
Term Management Plan 2021-2025”, which was announced on
May 7, 2021, to accelerate responses to climate change.

Medium Term Management Plan

■ Scenario Analysis

https://press.jal.co.jp/en/items/uploads/bc57cfb6ca40a6
955d89dbbb5253224e7dbf6beb.pdf

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Environment

Addressing Climate Change■ Targets and Initiatives towards CO2 emission
reduction by 2030

Metrics and Targets■S cenarios towards net zero CO2 emissions by
2050

Acceleration of addressing climate change was included in
the JAL Group Medium Term Management Plan for FY2021- FY2025.
Due to the nature of the air transportation business, directemissions from aircraft account for approximately 99% of the
JAL Group’s total CO2 emissions. Therefore, the Group will
first focus on reducing CO2 emissions from aircraft, it will also
set aggressive targets in reducing CO2 emissions from groundfacilities and take sincere measures.

Regarding the reduction of CO2 emissions from aircraft, its
scenarios by 2050 are considered, referring to the latest study
materials by ICAO and IATA, and proceeding to a discussionof future issues and measures to be taken.

The JAL Group’s target for 2030 to keep total emissions below
90% level of that of fiscal 2019 is one of the most ambitious
targets for airlines around the world. We will strive to achieve
our goals by steadily upgrading to the latest aircraft basedon stable financial base, reducing CO2 emissions in daily
operations through the promotion of JAL Green Operations,

Scope 1

FY2025 CO2 Reduction Target

FY2019 result

Aviation: 9.09 million tons

5.55 million tons
( INT:
DOM: 3.54 million tons )JAL Group‘s Road Map towards Net Zero CO Emissions*
2

CO2 Emissions (10k tons)

CO2 Emissions (10k tons)

CO2 Reduction

1,200

Reducec. 0.5 million tons

1,000

800

below 9.09
million tons

600

c. 60%

below 8.18
million tons

・Steadily introduce Airbus A350 and Boeing-787,
more fuel-efficient models

・Coordinate with aircraft manufacturers topromote R&D of electrified/hydrogen-fueled
aircrafts

2025

FY2030Emission
Reduction

2030

c. 5%

Total
Emissions
Below FY2019

90% from
FY2019 volume

c. 0.5 million tons(c. 6%)

c. 2 million tons(c. 20%)10%

partnership for the next-gen air traffic system

FY2030Emission
Reduction

SAF
1%emissions on a daily basis)

・Proactive participation in public-private

Use of SAF

Amount ofReduction

Ratio of SAF to total fuels

・Promote JAL Green Operations (to reduce

Fulcrum SAF manufacturing
plant in Nevadac. 35%

・Switch to SAF by 10% for FY2030, based on thepremise of improvement of the usability

・In addition to the Fulcrum partnership, build

Medium Term Management Plan

Use of SAF:
45%

Upgrades to Fuel-efficient Aircraft

Reduction of CO2 Emissions in Daily Operations

Amount of reduction
from BAU

2.0℃ scenario→
400

Keep the amount of the total
Total emission:
below 8.18 million tons emission below 90% level of the(Reduce c. 2 million tons)
actual amount of FY2019

FY2030Emission
Reduction

600

FY2019Reduction in daily
operations: 5%

Reducec. 2 million tons

CORSIA level

800

Upgrades tofuel-efficient
aircraft: 50%

FY2030 CO2 Reduction Target

Keep the amount of the
Total emission:
below 9.09 million tons total emission below the(Reduce c. 0.5 million tons)
actual amount of FY2019

The JAL Group Value Creation Story

Refer to the next page for details up to 2030

1,000

Foreword■ Reflection in the Medium Term Management
Planand expanding sustainable aviation fuel (SAF) load.
As for SAF, manufacturing and distribution overseas isaccelerating, and in Japan, the government’s Green Growth
Strategy laid out a concrete path to SAF manufacturing anddistribution by 2030. The JAL Group has set an ambitious goalof replacing 10% of fuel loads by SAF in 2030 and will workon SAF commercialization in cooperation with stakeholders inJapan and overseas through public-private partnerships.

and integrated supply chain of Japan-made SAF

200

1.5℃ scenario→

0

FY2019

2025

2030

2035

2040

Target of CO2 reduction (net)Upgrades to fuel-efficient aircraft

CO2 emissions with no efforts (BAU)

Reduction in daily operations

2045

Net Zero CO2Emissions*2050

In addition to “JAL Green Operations” to reduce CO2 emissions in daily operations, promoting collaboration across the entire
industry, including air traffic control agency, airlines, and airport operators

Ground facilities:
80,000 tons (Japan only)

Aim to achieve targets through energy saving
initiatives such as energy conservation, facility
upgrading, workstyle innovation, and infrastructure
improvements, and the use of renewable energy

FY2030 CO2 Reduction Target
Total emission:
below 40,000 tons

50% level of FY2013 results* Achieving a balance between the amount of carbon emissions actually generated by business activities and the amount of reduction achieved through measures =■ Cooperation with external parties to reduce
CO2 emissions
While strengthening coordination and collaboration with various
stakeholders in and outside Japan, we will lead the industry
in pursuing cutting-edge initiatives based on the internationalframework for CO2 reduction and in line with the Green Growth
Strategy of the Japanese government.
Specifically, in addition to actively participating in study meetingsorganized by Ministry of Land, Infrastructure, Transport andTourism on CO2 reduction in flight operations, airports and otherdomains, we will consider appropriate CO2 reduction targets of
the aviation industry to be achieved by 2030 as the Secretariatof the Scheduled Airlines Association of Japan, promote the useof SAF, and engage in high quality, inexpensive carbon credits inJapan.

■ Environmental data disclosures
In order to pass on the precious Earth to the next generation,
the JAL Group has set targets for CO2 emissions, waste andwater consumption, and other environmental data, anddiscloses the results.

Data Book

Use of SAF Collaboration with stakeholders to aim for a decarbonized society to secure SAF supply and reduce costs
Net Zero Emission (including emissions trading and CCS (CO2 absorption technology))

FY2013 result

Use of SAF

Utilizing the latest fuel-efficient aircraft today and aim to introduce aircraft using new technologies in the near future,
Upgrades tofuel-efficient aircraft such as hydrogen and electric powered aircraft

Reduction in daily
operations

Scope 2https://www.jal.com/en/sustainability/esg/pdf/esg.pdf

https://www.jal.com/en/sustainability/environment/partnership/

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Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Environment

Addressing Climate Change【Efforts towards the adoption of domestically
produced SAF】

Specific Initiatives■ Upgrading to fuel-efficient aircraft■ Percentage of fuel-efficient aircraft
Share of Fuel-efficient Aircraft in JAL Group’s Fleet
（%）
100

21

35

28

65

72

79

FY2016

2017

2018

16

60
40
20
0

Non fuel-efficient aircraft

82

84

2019

2020

Fuel efficient aircraft

Fuel-efficient aircraft: A350, 787, 777, 737-800, E170/190, ATR
Actual figures to fiscal year 2019; plans in fiscal year 2020.

Based on the fundamental premise of aviation safety’s
adherence to the principles, a variety of measures to reduce
CO2 emissions are devised, including eco-flight initiatives
by devising the timing and choice of handling during flight
operations, reducing weight of aircraft, and improving fuelefficiency through regular engine internal cleaning.
Furthermore, by promoting JAL Green Operations, a crossorganizational activity, which monitor the status of each
initiative and share the progress within the company, thereby
promoting the PDCA cycle to reduce CO2 emissions.

81

JAL REPORT 2021

Project to turn used clothing into SAF
As part of these efforts to commercialize domestic
SAF, we produced Japan’s first domestic SAF madefrom cotton clothing supplied by customers using only
domestic technology with the cooperation of many
Japanese companies, and after passing compliancetesting for international fuel standard ASTM D7566
and quality inspections, the SAF was loaded on ascheduled domestic flight for the first time.

In response from feedback from customers who have a keeninterest in protecting the environment and preventing global
warming, the JAL Group, in collaboration with blue dot green
Inc., offers passengers the option to offset the CO2 emitted by
the aircraft they fly on through our JAL Carbon Offsets program.
～ 4 Initiatives ～○F orest management project in Oguni, Kumamoto prefecture○D eforestation prevention project in Rimba Raya Biodiversity

Reserve, Indonesia○F orest management project of 4 towns in Hokkaido○ Investment in water infrastructure project in Africa aimed at

improving sanitation.

■ Measures to reduce CO2 emissions fromground facilities
In the area of ground facilities, initiatives with the goal of
reducing unit energy consumption by 1% or more on average
have been promoted. Under the “operator classification
evaluation system” of Act on the Rational Use of Energy (Energy
Conservation Act) implemented by Ministry of Economy, Tradeand Industry, the Group has been certified as “S Class”, an
excellent business operator, for 6 consecutive years since 2015.

■ Supporting the development and use of SAF
Aiming to be a leading airline in the use of SAF, JAL Groupis working on a variety of projects, including investment
in Fulcrum, a US-based SAF manufacturer, use of SAF
produced in Japan for the first time in scheduled flights, andcollaboration with partner companies to build supply chains
for Japan domestic SAF.

【JAL Carbon Offsetting】[Details]

Date: February 4, 2021
Flight Number: JL319
Route: Tokyo Haneda to Fukuoka (Departure 13:00)
Aircraft Type: Boeing 787-8 (JA849J)
LED high ceiling apparatus for hangar【Overseas SAF Procurement】
In the U.S, we invested in Fulcrum in 2018, and the firstplant was completed and started operation in July 2021. JAL
Group plans to begin utilizing the SAF procured from Fulcrum
in scheduled flights, departing from the West Coast of theUnited States, around 2024.
In addition to procurement from Fulcrum, we also plan tocontribute to reducing the volume of carbon emissions bystarting to utilize SAF in flights from Europe and the UnitedStates, where mass production is progressing.

Near the entrance of the renewed andreopened “JAL factory tour ~ SKY MUSEUM ~”Successful domestic SAF project

CONTRAIL Project

As the first step to commercialize domestic SAF, theSAF, that was manufactured in the project involving
many years of work by public organizations, SAF
manufacturers and airlines, passed quality inspections
and was approved for use in actual flight operations.
The JAL Group loaded two types of SAF, produced fromdifferent raw materials in a demonstration plant, for the
first time on a scheduled flight.

The JAL Group has been working on in flight atmosphericobservation since 1993. In 2005, the National Institutefor Environmental Studies (NIES) and aircraft parts
manufacturer JAMCO Corporation joined the efforts to
expand and enhance the scope of these atmosphericobservations, and with each party putting their expertise
to use, the CONTRAIL Project was born. The CONTRAIL
Project is the world’s first planned ongoing, global-scalecontinuous measurement of greenhouse gases using
equipment installed on scheduled passenger flights, andthis joint public-private project continues its activities today.

Data Book■ Reducing CO2 emissions in daily operations

We, as pilots, are working to reduce the volume carbon
emissions and devising various operations that take theglobal environment into consideration. As a company, we
have set a target for net zero CO2 emissions by 2050, andin order to achieve further reductions in CO2 emissions, itis necessary to deregulate by revising laws and take newmeasures in cooperation with airports and air traffic control.
While the Japanese government is committed to achieving
net zero carbon emissions, theStudy Group on CO2 Reductionin Aircraft Operations wasestablished to further accelerate
and promote initiatives toreduce carbon emissions in all
aspects of aircraft operations.
We will also participate in the
MATSUNAMI Koji
study group and work together
Vice President, Flight Standards
with stakeholders to realize new Engineering Department
Boeing 777 Captainmeasures.

Medium Term Management Plan

With the acceleration of next generation aircraft development
such as the announcement of plans by Airbus to introducehydrogen powered aircraft to the market from 2035, the JAL
Group will cooperate with aircraft manufacturers to promotetechnological innovation toward for the development ofelectric and hydrogen powered aircraft.
We will decide the specific schedule of upgrading our fleet
while monitoring aircraft development and will steadily
upgrade to state-of-the art aircraft that emit less CO2. As
infrastructure including airports need to be developed aswell, we will work with various stakeholders including
the government and airport companies to improve theenvironment.

Frontline’s ingenuity in reducing CO2 emissions

The JAL Group Value Creation Story

80

18

VOICE

In addition to responding to Carbon Offsetting and Reduction
Scheme for International Aviation (CORSIA), the JAL Groupalso offers JAL Carbon Offset, in cooperation with Blue Dot
Green Co., Ltd., as a unique initiative that allows passengers
to offset their own CO2 emissions on their flights.

Foreword

In September 2019, the Airbus A350 entered service on
domestic routes, and in October 2019, the Boeing 787,
which had been in service on international routes since 2012,
entered service on domestic routes. These aircraft are fuelefficient and produce less noise and can reduce the amount of
CO2 emissions by 15% to 25% compared with conventional
aircraft.
Utilizing funds raised in public equity offering in 2020, theJAL Group will steadily continue to upgrade to fuel-efficient
aircraft in fiscal 2021 and beyond.

Since February 2020, we have collaborated with Marubeni
Corporation and ENEOS Corporation in a business assessmenton the feasibility of a domestic supply chain for the
manufacture, distribution and sales of SAF derived from plastic
waste and other industrial wastes.
In view of growing global demand for SAF, we will actively
work with the public and private sectors and the aviationindustry to establish a mass production system for domestic
SAF and a supply chain for continuous SAF loads at hub
airports in Japan.

■ Engaging in emissions trading[Details]

Date: Thursday, June 17, 2021
Flight number: JL 515 (Departing from Tokyo (Haneda) boundfor Sapporo (New Chitose airport))
Aircraft Type: Airbus A 350

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Business Strategy

Finance Strategy

E Environment｜S People｜S Communities｜G Governance

ESG Strategy

Environment

Effective Use of Limited Resources
Basic Concept

Specific initiatives to reduce food loss and waste■ In accordance with the JAL Group Environmental Policy,■ As a key initiative, we are working to

the JAL Group promotes the 4Rs (Refuse/Reduce/Reuse/
Recycle) in each business process in order to create arecycling-based society.

reduce the use of petroleum-derived
single-use plastics and reduce food loss
and waste.

Greenhouse gas emissions from food including waste are estimated to be 21 ~ 37% of global emissions.
The JAL Group is aware of the problem of food loss and waste and is implementing initiatives to prevent this.
The JAL Group is reducing food waste through the 3Rs (Reduce, Reuse, Recycle) + 1R (Refuse).
https://www.jal.com/en/sustainability/environment/limited-resources/#anc09

Specific initiatives to reduce single-use plastics*1 Redesign means redesigning products such as reviewing their use, procurement and disposal methods, and developing a collection and recycling system in cooperation withexternal companies.

Single-use plastics used (Japan Airlines Co., Ltd.)
Present

In order to address the plastics problem, we are discussing
reduction methods and targets, driven by the company-wide
Plastic Working Group. In September 2019, we removed plastic
straws and plastic muddlers from our cabin service and lounge
service goods. Further, in May 2021, we announced singleuse plastic reduction targets in the Medium Term Management
Plan. By promoting the 3Rs (Reduce, Reuse, Recycle) + 1(Redesign), we will reduce the use of single-use plastics provided
to customers by 2030 through the following process.

PresentHigh○ Long life design through reuse

Priority
Redesign○ Elimination of plastic(convert to other sustainable materials)○ Recyclable materials(recycled plastic/Bagasse-based plastic, etc.)○ Conversion to environmentally0
Passenger Cabin and Lounge

2025

Others (cargo, airports)

Cabin and Lounge: Single-use plastics discontinued
Others: 100% switch to eco friendly materials

・Reviewed the bottled dipping
sauce for soba noodles (fiscal 2019
results: 4.9 tons)
・Reviewed the service style;switched to a gelled dipping sauce
for soba noodles

Low

recycling schemes in cooperation
with customers and suppliers○ Thorough separation of waste
and promotion of recycling

Reuse

Blend of eco friendly materials

Bottled sauce

Noodles with gelled sauce・Introduced polyurethane coatedgloves as a COVID-19 infection
prevention measure・Reduced the consumption ofplastic gloves

・Discontinued the use of all plastic straws and muddlers in 2019.
・Switched to paper straw using FSC® certified paper and wooden muddlers
・Switched Economy Class plastic drink cups to FSC® certified paper cups.

(biomass/compostable)○ Establishment of collection and

JAL's
FLW 4R

Reuse

friendly materials

Recyclethe number of meal reservations and the actual number ofpassengers

・As a unique JAL initiative, to reduce incineration of plastic bottles,
cabin attendants segregate waste from flights after arrival for recycling(converted to plastic bottles by beverage manufacturers)

Reuse of “non-standard” crops
Donations to welfare councils

We are taking steps to serve fruit that will be discarded
if they are deformed or damaged in in-flight meals by
the end of this fiscal year. By sterilizing and freezing
fruit after preparing them, their use-by dates can beextended while ensuring food safety, thereby reducing
food waste. Efforts to reuse non-standard farm products
to be discarded by converting them into valuable
products can also contribute to the local community.
We are also working to establish an in-flight meal
donation program through social welfareorganizations of local governments.

ReduceLet's do ethical sky!

RecycleMenus can be eaten completely
Ingenuity in the cooking process
Loss meal* trend analysis
Leftover food prevention promotion

Thorough recycling of cooking residual
Adoption of recycling-oriented crops

RecycleJAL Royal Catering (JRC) aims to recycle all leftover cooking oil
generated from in-flight meal production by fiscal 2025. Since
the summer of 2021, the company has been providing in-flightmeals, which use vegetables grown in vegetable waste compost
during food processing. This initiative not only promotes thecreation of a recycling-based society, but also contributes toreducing CO2 emissions during
food transport through “local
production for local consumption”
using farm products grown near
Narita Airport.
In-flight meal spinach grown on farms withsustainable environmental practices in place.
Fumiko’s Western Food SDGs ~ A dish froma list of 50 future ingredients

Data Book

Reuse

and parts replacement○ Breaking away from disposable(converting to silicon materials
reinforced plastics, etc.)* Surplus in-flight meals caused by discrepancies between

RefuseMedium Term Management Plan

ReduceWe are working to develop menus that customers
will thoroughly enjoy, thereby completely finishing
their meal, with the aim of reducing food residues
through creative cooking, reducing waste meal*,
and reducing leftover food. Also, as a uniqueinitiative of JAL, we are also asking our customers
to cooperate in reducing leftover food.

Ethical Choice Service

Single-use plastics discontinued

for/by changing the way of
thinking○ Reducing the number ofpurchases, weight, and size

As some customers do not need in-flight meals,
we introduced the “JAL Ethical Choice ~ Meal
Skip Option” cancellation service. It allows
customers to demonstrate their willingness toRefuse. This is the first time that an international
airline is planning to expand this service on all
international routes.

2025

2025

Petroleum-based plastics only

○ Fundamental review of the need

ReduceThe JAL Group Value Creation Story■ Discontinuation of use of single-use plastics
in-cabin and in lounges

RefuseForeword■ JAL’s FLW (Food Loss & Waste) Reduction Program
The JAL Group is taking steps to deal with plastic problems that cause global warming and marine pollution.
We have set single-use plastic reduction targets as management targets and aim to achieve them through the
3Rs (Reduce, Reuse, Recycle) + 1 (Redesign)*1.

VOICE
As a member of the Food Loss and Waste Reduction Project
After working at Gimpo Airport in South Korea, I was in charge of in-flightmeal menu development at JAL Head Office and engaged in CO2 emission
reduction as a member of the food loss and waste reduction project.
We are working day and night to create tasty menus that our customers
would thoroughly enjoy. We started a new service that allows customers
to refuse their in-flight meal to stop preparing more in-flight meals thannecessary. We are taking steps to leave a greener environment for the next
generation.

SIN Jae-yoon
Catering Operations, Quality
Management Group,
Product and Services
Department

Aggressively purchase commercial products manufactured with the same priority

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Medium Term Management Plan

Business Strategy

Finance Strategy

Environment

Prevention of Environmental
Pollution

Basic Concept■ In accordance with PRTR (Pollutant releaseand transfer register) regulations, theJAL Group manages hazardous chemical
substances and strives to reduce the amounts
handled and released.

Specific Initiatives

Environment

Noise Reduction■ In order to fulfill our responsibility as social

infrastructure, the JAL Group is actively
working to reduce noise in order to coexist
with residents in communities near airports
and sea routes.

Specific Initiatives■ Changes in the percentage of ICAO noise
standard compliant aircraft
We are steadily upgrading our fleet to the latest aircraft models that
emit less CO2 and meet noise standards (ICAO Chapter 4, Chapter14) and are taking measures to reduce noise around airports.
%
100

100%

100%

60
40

43%

46%

49%

Achievements
in fiscal 2020

Targets forfiscal 2021

Targets forfiscal 2025

20

Chapter 4 compliant aircraft

Chapter 14 compliant aircraft

Biodiversity Conservation■ The JAL Group is aware of the direct and indirect impacts of its air transportation business on biodiversity

conservation. In accordance with the JAL Group Environmental Policy, the JAL Group will address biodiversity
conservation in a proactive manner by “fulfilling our responsibilities for biodiversity conservation as an air transport
operator” and “reducing the environmental impact of our business and minimizing impacts on the ecosystem.”Specific Initiatives■C hallenge toward registration as a World
Natural Heritage Site

Examples of initiatives
・Participation in the Liaison Conference on Measures against Poaching
and Smuggling
・Installation of road signs to prevent road kill of rare species
・Maintenance and PR of the Amami hiking trail, which covers the
Amami Islands
・Beach clean-up activities to pick up litter85

JAL REPORT 2021

Launched in 2019 by JAL, JAC, JTA, NTT DOCOMO
and other parties, this joint community promotes theregistration of World Heritage Sites by connecting local
companies and organizations. We are utilizing thestrengths of participating companies and organizations
to protect the natural environment and promote
regional development through nature.
The moment the participants,
at venues in Kagoshima andOkinawa, share the joy when
the decision was made to
add the islands to the World
Natural Heritage list.
(The photo was taken in frontof the special livery aircraftat JTA Maintenance Center“Corporate Venue”)

In April 2020, JTA, established a joint committee to examine
mechanisms for coral reef restoration activities in Yaeyama, based ona plan to support the Yaeyama Fisheries Cooperative in Ishigaki City,
Okinawa Prefecture together with local companies and the Fisheries
Civil Engineering Technology Center for six years. Although coral may
look inorganic, they are creatures such as jellyfish and sea anemonesthat lay eggs once a year. Sexual reproduction is a method of breedingcoral eggs. By 2018, the Fisheries Agency developed technology toefficiently fertilize coral eggs in a form close to nature, enabling the
production of large numbers of seeds and seedlings.
The Yaeyama Fisheries Cooperative is engaged in coral reef breeding,which requires a high level of technical expertise, under the technicalguidance of the Council.

■ Official Supporter of International Year of
Plant Health 2020
The United Nations declared 2020 as International Year of
Plant Health to raise global awareness of the importance ofpreventing the spread of plant pests. As an official supporterof International Year of Plant Health 2020 of approved by the
Ministry of Agriculture, Forestry and Fisheries (MAFF), the JAL
Group is working raise internal and external awareness of theimportance of plant protection.
Not only do we need to be careful when taking plants overseas
or bringing them into Japan, there are also restrictions on the
movement of plants in Japan. For example, taking out sweet
potatoes from the Nansei Islands (the Amami Islands in Okinawa
and Kagoshima prefectures) and the Ogasawara Islands is
restricted. At an in-house workshop held in February 2020, we
invited MAFF officials to talk about plant damage caused bydiseases and pests, plant quarantine, and their relationship withthe aviation industry. As pest and disease control is costly, it isextremely important to prevent the invasion and spread of pests
and diseases. We raised staff awareness through e-Learning,
published an article in the May edition of our in-flight magazine“SKYWARD” and showed an in-flight video on plant quarantine
in cooperation with MAFF from September to December 2020.

* One Health is an integrated approach to ensure the circle of live remains healthy

and balanced recognizing the interconnection of the health of people, animals andecosystems.

Workshop on prevention of illegal wildlife trade

World Heritage programs to commemorate
registration as World Natural Heritage
The JAL Group is planning and implementing a“unique to the JAL Group” World Heritage Guests
Program to visit, see, and interact with areas that havebecome treasures of the world, as part of its efforts tocommemorate World Heritage registration under thethemes of “connecting the world with Japan’s World
Heritage, which has become a treasure of the worldfrom local treasures”
and “connecting
Japan’s World Heritage
to future generations
through coexistence
and conservation withnature”.

Data Book

In July 2021, the Japanese islands of Amami-Oshima Island,
Tokunoshima Island, the northern part of Okinawa Island, and Iriomote
Island, which were separated from the mainland several million years
ago and are home to rare species such as the Amami rabbit and
Iriomote wildcat, were registered as a World Natural Heritage Site inrecognition of their biodiversity and rich natural environment. The JAL
Group is also closely involved in these activities.
JAPAN AIR COMMUTER (JAC) and JAL Kagoshima Office, both
located in Kagoshima, Japan Transocean Air (JTA) and RYUKYU AIRCOMMUTER (RAC) based in Okinawa joined hands with the local
community to protect and raise awareness of the natural environment.

World Natural Heritage Promotion Joint
Association (Okinawa)
World Natural Heritage Promotion
Community (Kagoshima)

Sexual Reproduction and Coral Regeneration Support
Council

In June 2018, the JAL Group signed the Buckingham Palace
Declaration by the United for Wildlife Transport Taskforce toreduce illegal wildlife trade promoted by the International Air
Transport Association (IATA).
Wildlife trafficking is one of the world’s largest crimes, witha trade value of trillions of yen, next to drugs and humantrafficking. In order to prevent crimes, Ishigaki Airport staff
found coconut crabs, an endangered species, being takenout of the island in baggage labeled “pineapple” and Amami
Airport staff found rare frogs and snakes being taken out.
In this way, the transportation stage plays a vital role inpreventing illegal trade in wildlife. In 2020 and March 2021,
we invited officials from the World Wide Fund Japan (WWFJapan) to hold a workshop on the current situation of illegal
wildlife trade and how to respond in case live animals arefound during transport.
Furthermore, we are increasing more opportunities to raiseawareness internally by training instructor-staff, strengthening
efforts to eradicate illegal wildlife trade in cooperation withexternal parties, and endorsing the joint statement by WWF
Japan, “People, Animals, and Ecosystems: One Health*.”The JAL Group is committed to the conservation andsustainable use of biodiversity.

Medium Term Management Plan

Basic Concept

One of the charms of Okinawa is its blue waters and colorfuland vibrant coral reefs. In addition to its scenic function asa tourism resource, the coral reefs are also habitats to many
species, and play various roles such as national land conservationand disaster prevention through wave dissipation effects.
In recent years, the depletion of coral reefs along the coast of
Okinawa Prefecture has become a problem, as seen by bleachingcaused by rising sea temperatures and the emergence of many
starfish. The JAL Group is working to restore coral reefs.

■ Preventing illegal wildlife trade

The JAL Group Value Creation Story

100%

80

0

Environment■ Coral sexual reproduction and coral
regeneration project

Basic Concept

Foreword

We aim to achieve a final disposal rate of 1% or less bypromoting the segregation and collection of industrial waste
at maintenance facilities and thorough waste management
including the selection of disposal sites.
Furthermore, we are working to reduce emissions of carbon
dioxide (CO2), nitrogen oxides (NOx), carbon monoxide (CO),hydrocarbons (HC), and other substances emitted by aircraftin order to prevent air pollution. All JAL Group aircraft engines
conform to all regulatory values and the appropriate standards
set by ICAO (International Civil Aviation Organization) (ICAO
CAEP6/CAEP8 standards for NOx regulations; standards differ
at the time of type certification).

E Environment｜S People｜S Communities｜G Governance

ESG Strategy

Inflight video image

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernancePeopleBasic Concept (JAL Group Code of Conduct)

Priority issues

Initiatives●

Promotion of D&I●●

Workstyle Innovation

The JAL Group provides information on products and services
appropriately, takes comments from customers sincerely, andcontinuously strives to develop and provide better products andservices in order to deliver unparalleled service to our customers.
When doing so, we put ourselves in the customers’ position anddevelop innovative products and services to meet diverse customer
needs.

Health and Productivity
Management

Respect for human rights and job satisfaction (humanrights and labor)

Human Resources
Development

●
●

●
●

●
●

●

Improving Accessibility

Preventing the Spread of
Infectious Diseases

●

●
●

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human/health-management/
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human/human_rights/
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Dialogue with external
experts
In 2019, we established the JAL Group Human Rights Policy
to clearly define our approach to respecting human rights.
Aligned with the UN Guiding Principles on Business and Human
Rights, the policy states that we will incorporate human rights
due diligence (Human Rights DD) in business processes inorder to respect human rights throughout our operations.
In December 2020, we conducted a company-widerisk survey on human rights risks of the JAL Group andcompiled the results in a risk map to identify humanrights issues of importance. To address these risks, we
invited SHIMOTAYA Takeshi, Representative Director of

the Global Alliance for Sustainable Supply Chain (ASSC),
which promotes international human rights initiatives, toparticipate in dialogue with directors of key divisions, whichhave relationships with important stakeholders across thevalue chain, such as Human Resources, General Affairs,
Procurement, and Products and Services.
Mr. Shimotaya provided valuable advice from various
perspectives, including human rights risks related to COVID19, based on which we summarized our efforts on important
human rights issues and disclosed them on the JAL website.
Going forward, the JAL Group will continue to engage indialogue with society and fulfill its responsibility to respect
the human rights of all people, in accordance with the
Human Rights DD mechanism defined in internal regulations,as we believe that respecting human rights is a universal
value.

P.95
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The JAL Group Value Creation Story

Respecting others means respecting different cultures and values. To
achieve this, we actively interact with diverse cultures from aroundthe world.
To create productive workplaces where employees are motivated intheir jobs, we take pride and joy in doing our best for our colleagues.

Respect for Human
Rights

●P.89-90https://www.jal.com/en/sustainability/
human/diversity/

Respect for Human Rights

Foreword

Pursuit of customer satisfaction

TOPIC

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prevent-infection-spread/

https://www.jal.com/en/sustainability/codeofconduct/
Dialogue between ASSC President Shimotaya and the directors of key divisions at the time

Promotion of D&I

Creativity and individuality
are the sources of value
creation

Embracing challenges with respect forindividuality
With a strong aspiration to “create a company where
employees, with or without disabilities, can play an evenmore active role,” I thought of ideas for new challenges
while communicating closely with staff. We foundthat some employees had a strong interest and talent
in art and painting, and in
March 2021, launched thenail room business run byemployees with disabilities.
This is not the only new
business we have created.
We will continue to embracechallenges that recognize
MIYASAKA Kumikoand utilize the individuality(photo right)of every employee.
President of JAL Sunlight

TOPIC

Improving Accessibility

Serving customers withdisabilities in the COVID-19
pandemic
In order to appropriately serve customers with disabilities in
the pandemic, we established Customer Service Guidelines
dealing with COVID-19. For example, we changed waysof assisting wheelchair users and guiding customers withvisual impairment in order to prevent infection to bothcustomers and employees. Wooden wheelchairs for rental
service are given antiviral and antibacterial coatings andother equipment are disinfected after each use to create
an environment of ensuring safety and comfort for all
customers.
Support based on COVID-19 measures:https://www.jal.co.jp/jalpri/flysafe/

87

JAL REPORT 2021

Data BookIn April 2020, a former cabin attendant became Presidentof JAL Sunlight Co., Ltd., a company which espouses thephilosophy to “continuously create new value by leveraging
diversity in an environment where disability is not a barrier.”
Immediately after her appointment, she began embracing
challenges as a new leader by drawing on her individuality
and abilities. Her high sensitivity toward service cultivatedfrom frontline experience and her experience as a cabin
attendant which requires quick action, are reflected in her
speedy actions, from the time of conceptualization of abusiness idea to implementation.
This is a successful example of D&I in value creation from awoman’s perspective.

VOICE

Medium Term Management Plan

TOPIC

Furthermore, in cooperation with other airlines, airport
building companies, and airport operating companies, weare exchanging views with people with disabilities on how
to deliver safety and comfort in air travel services provided
by the aviation industry including the JAL Group. Throughdemonstrations of appropriate service methods during
the pandemic, the participating companies made new
discoveries, deepened their understanding of people withdisabilities, and are working to improve customer service andcreate a seamless mobility environment.

JAL REPORT 2021

88

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

E Environment｜S People｜S Communities｜G Governance

ESG Strategy

PeoplePromotion of D&I■ Promoting the participation and advancement of human resources
hired outside Japan

Basic Concept

In a global environment, we respect diverse cultures and are working to develop humanresources who can create new value. Despite travel restrictions during the pandemic, weare continuing to work on this through online training and remote support. We are also
promoting career advancement of employees outside Japan, who currently account for about
30% of important posts in overseas offices (airport offices, district sales offices, etc.). We willcontinue to develop human resources under a well thought out plan and increase the ratio ofmanagers both inside and outside Japan.

■ Ever since top management announced its commitment to diversity in 2014, we have taken steps to

become a company where all employees can work in a positive environment regardless of gender, age,nationality, race, disability, sexual orientation, gender identity, or other personal attributes.
To achieve this, we respect individuality and ensure equal treatment in all important aspects of humanresource development, such as recruitment, job assignment and advancement, and promote D&I andworkstyle innovation in an integrated manner to facilitate the active participation of diverse humanresources.

■ Promoting women’s advancementin which top management leaders serve as lecturers. Goingforward, we would like to see more women step up as leaders
in terms of both development and advancement.
In recognition of our efforts to develop women leaders, JAL
received both the Second Award (Corporate Award) and the
Executive Award (Individual Award) in the Advance categoryof the 2021 J-Win Diversity Awards*.

Number and ratio of female managers in the JALGroup■ Number of female managers

Ratio of female managers(people)
1100

19.5%

800

15.1%

700

756

600

15.6%
799

16.3%

16.3%

18.0

16.8%
983

846

853

In order to promote the active participation of employees with disabilities, we are embracing
the challenge of developing new fields where they can utilize their talents and abilities. In
addition to cafés and massage rooms, we opened a nail room in Haneda in fiscal 2020, where
employees with disabilities play an active role and employees can deepen their understandingof D&I.

1053

882

2014 nd FY2015 nd FY2016 nd FY2017 nd FY2018 nd FY2019 nd FY2020
End FY
E
E
E
E
E
E

17.0
16.0
15.0
14.0
13.0

* Awards sponsored by the Japan Women’s Innovative Network (J-Win), a non-profit
organization, to recognize companies and individuals who promote D&I

Nail room opened in fiscal 2020

■ Diversity promotion project by employees

Medium Term Management Plan

900

20.0

■ Promoting of challenges by employees with disabilities

19.0

18.4%

1000

（%）

We have been actively hiring experienced employees to link diverse knowledge acquired outside the company to value creation. Theseexperienced professionals work in fields that require advanced knowledge such as business creation, digital innovation and ESG, andare creating new value. Many of them have been promoted to managers, with an increasing number of employees participating inimportant decision-making each year and even advancing to management positions.
As many of these experienced employees, who joined the company during a certain period, will be reaching retirement age soon,
we expect a temporary decline in the total number of managers among them. We will therefore resume recruitment of employees
possessing diverse knowledge and experience and strive to achieve the same ratio of managers and the ratio of new graduate recruits.

The JAL Group Value Creation Story

The JAL Group has focused on the development andadvancement of women and global human resources toensure fair and equitable treatment and allow everyone toplay a leadership role.
As of the end of March 2021, women held 19.5% ofmanager-level positions in the JAL Group, which shows steadyprogress of our efforts. The Medium Term Management
Plan sets a target of raising the proportion of women in
management roles in the JAL Group to 30%, and we areaccelerating efforts to achieve this.
Furthermore, to increase women at the board and executive
levels, we are taking steps to increase women at the Vice
President and senior manager levels. In the past two years,
the number of female Vice Presidents has increased 1.5-fold(57 as of June 2021), and many women have been promoted
to station managers at hub airports such as Haneda, Narita,
Osaka, and Fukuoka.
In the Cabin Attendants Division, leaders of frontline
departments are all women. In order to further increase thenumber of women in leadership roles, we hold study meetings

Foreword■ Recruitment and advancement of experienced employees from outside the company

Specific Initiatives

As a bottom-up approach to promoting D&I, we are carrying out a project called “JAL D&I
Lab.” In fiscal 2021, the members divided into teams under the themes: Globalization, The
Active Participation of People with Disabilities, The Active Participation of Women, and Life
and Career Development, and have been creating ideas based on free-thinking and areshaping them into measures for implementation this fiscal year.
Together with the top-down approach of top management, we will foster a corporate culturethat respects diversity conducive to value creation.
Presentation of JAL D&I Lab Activities

VOICE
Diversity at management level (Executive Officer)

Women’s Leadership Workshop

89

JAL REPORT 2021

〇 Female〇 Hired outside Japan 〇 Experienced employee
Data Book

As the further growth of women in top management is essential to women’s participation
and advancement in the workplace, we have held the Women’s Leadership Workshop,“Akasaka-Juku (school),” regularly since fiscal 2021 under the direct guidance ofPresident Akasaka. Many of the participants are Vice Presidents and senior managers infrontline divisions such as at Airports and Cabin Attendants. As Secretariat, I have pursued
a career as a cabin attendant and I am currently in charge of employee training in theWork Philosophy Development Department.
The objectives of the Female Leader’s Workshop “Akasaka-Juku (school)” are:· To acquire the ability to think, discuss and act by looking ahead, grasp the overallsituation and implement strategy; and· To create new value through cross-functional coordination and mutual learning.
Participants are making efforts to improve their abilities from what they learned from theworkshops and are contributing to developing the next generation of women leaders.

Naoko Shishido
Vice President, Work Philosophy
Development

NAKANO Hoshiko

ABE Eri

YASHIKI Kazuko

TOTTORI Mitsuko

Ross Leggett

OMORI Yasushi

Deputy Senior Vice President,
Passenger Sales
Senior Vice President, EasternJapan

Deputy Senior Vice President,
Regional Revitalization
In charge of Support

Senior Vice President,
Haneda Airport
President of JAL Sky Co., Ltd.

Senior Vice President,
Cabin Attendants

Deputy Senior Vice President,
Route Marketing
In charge of International
Relations and Alliances

Senior Vice President, Mileage andLifestyle Business

JAL REPORT 2021

90

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernancePeoplePeopleWorkstyle Innovation

Health and Productivity Management

Basic Concept■ In pursuit of workstyles that are not bound by

location, we will create an environment where
everyone can actively participate in the workplace
under an appropriate working hours management
system.

Basic Concept■ We will promote “workcation” and “bleisure”

to encourage employees to take long vacations.

Specific Initiatives
Overtime Work and Annual Paid Leave
Applicants

PromotionsystemUnder the strong leadership of the CWO (Chief Wellness Officer, Representative Director, Executive Vice
President), we are vigorously promoting health and productivity management through management-level
initiatives led by the JAL Wellness Promotion Committee comprising directors, and workplace-level initiatives
led by Wellness Leaders in each workplace.

■ Average monthly overtime and holiday work (hours) per person
Percentage of employees taking annual paid leave (%)

85.5%

89.5%

86.0%
76.5%

12.0

FY2016

7.9

8.5

2017

2018

9.5

2019

71.5%
8.0

2020

■ Pursuing a workstyle not bound by location
Remote work
The JAL Group introduced remote work in fiscal 2014 as a means of promoting D&I and work-lifebalance and has continued to improve the IT environment and system to promote this workstyle.
The improved system has enabled the smooth shift to a workstyle in a remote work environment
mainly in support departments, even when businesses were asked to reduce the number of staff
commuting to the office in the pandemic.
We will further promote this workstyle, while solving the communication problem and finding thebest way for managing remote work.

Specific Initiatives■ Health promotion initiatives
Female employees play a central role in various JAL Group workplaces, and their health is an important issue. As a result of efforts to fully
subsidize the cost of gynecological examinations, expand opportunities for health checks for women and improve health literacy throughseminars and e-Learning including male participants, we achieved the target check-up rate for employees and are making steady progresson the target check-up rate for their families. Even in the unlikely event of illness, we have a comprehensive support system to enable
employees to continue work and achieve work-life balance. By promoting wellness and encouraging employees to maintain awarenessof their wellbeing, we would like all our employees to work cheerfully and energetically and improve productivity and increase corporate
value.

JAL Wellness 2025 KPI targets
Obesity rate [all employees]

Less than 15%

Specific health checkup rate [families]

75% or above

Specific health checkup rate [employees, families, special retired insured persons]

80% or above

Specific health guidance implementation rate [employees]

65% or above

Women’shealthGastric cancer screening rate [employees aged 35 and above]

StomachPromoting workcation and bleisure

Verifying new workstyles in the New Normal

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JAL REPORT 2021

Gastric cancer screening rate [spouses aged 35 and above/special retired insured persons]Colorectal cancer screening rate [employees aged 35 and above]

80% or above

Employee on workcation
Colon

Re-examination rate

Farm maintenance such as mowing andwatering orchards. Create new regional recipes.
■ Ishikawa Prefecture: Manage sheep grazing. Support hands-on
nature activities for parents and children.
Plan events held at important cultural assets in■ Iwate Prefecture:
cities.
■ Hyogo Prefecture: Hold events to keep culture alive in old local
movie theaters that were reopened by the local
residents.

Repair of Kumano Kodo pilgrimage routes

Mental health

90% or above

Colorectal cancer screening rate [spouses aged 35 and above/special retired insured persons]

60% or above

Re-examination rate

■ Ehime Prefecture:

90% or above

90% or above

40% or above

Re-examination rate

90% or above
60% or above

Uterine cancer screening rate [spouses aged 18 and above/special retired insured persons]

40% or above

Re-examination rate

90% or above

Women with excessively low BMI [women employees under 34]

50% or above

Re-examination rate

Cancerscreening

Outline of social contribution activities program
through workcation

Activities in Ehime Prefecture

90% or above

Uterine cancer screening rate [women employees aged 18 and above]

70% or above

Breast cancer screening rate [spouses aged 35 and above/special retired insured persons]Less than 20%

Percentage of e-Learning participants [employees]

Health literacy

80% or above

Wellness activities

Percentage of wellness activities by company and regions [employees]

100%

Regularly exercise [employees]

Lifestyle(specific healthcheckupquestionnaire)

Percentage of people with high stress [employees]

Less than 5%

63% or above

Restful sleep [employees]

80% or above

Moderate eating speed [employees]

70% or above

Consumption of alcohol within the recommended Government Guidelines [employees]

90% or above

Male employees

Smoking

Less than 20%

Data Book

By taking a workcation, employees can participate in social
contribution activities during their free time, discover needsof the local community, and think of ideas to create jobs andparticipants to revitalize the regional economy. Through theseexperiences, we aim to nurture employees’ awareness leading
to personal growth and discover new workstyles and new waysof taking holidays through co-creation with local communities.
At the same time, we would like to assist in solving regionspecific problems and contribute to regional revitalization. We
will then review new workstyles in the New Normal from a longterm perspective, considering conditions during and after the
pandemic, and introduce workstyles that are appropriate for our
objectives.

Re-examination rate

Breast cancer screening rate [women employees aged 18 and above]

Medium Term Management Plan

Lifestyle-relateddiseases

70% or above

In order to promote flexible workstyles, in 2017 we introduced workcation, which means working
while on vacation (work+vacation=workcation), and bleisure, which means travel combining bothbusiness and leisure (business+leisure=bleisure). We would like to nurture employee’s sensitivity
through experiences only possible in a local area and promote personal growth.
Workcation, in particular, has drawn people’s attention as a means of regional revitalization
by increasing the population engaged in this field and creating jobs, and has developed into a
co-creation activity.

The JAL Group Value Creation Story

The JAL Group is working continuously to foster a climate where employees with time
constraints, such as childcare and nursing care, receive fair and impartial treatment andwhere diverse human resources can embrace challenges, and thus create a society where
everyone can play an active role. Although the percentage of employees taking annual paid
leave has slightly declined during the pandemic, we are striving to optimize working hours
as well as promoting the planned acquisition of paid leave. In fiscal 2020, the percentage ofannual paid leave applicants was 71.5%, and the average monthly overtime and holiday (daysoff) working hours per person was 8.0 hours (excluding general staff with shift work). In
fiscal 2020, we achieved 1,878 hours, or 98.5% of the target of 1,850 actual working hours.
* Data: Japan Airlines Co., Ltd.

physical and mental well-being our employees and their families is essential to “pursuing the material
and intellectual growth of all our employees and delivering unparalleled service to our customers” asarticulated in the JAL Group Corporate Policy. We are currently working on “JAL Wellness 2025” based on
five major indicators; lifestyle-related diseases, cancer, mental health, smoking and women’s health.

Foreword■ Optimizing working hours■ The JAL Group health promotion project “JAL Wellness” was launched with the recognition that theBreast cancer

2

Uterine cancer

Chapter

Female employees

Less than 3%

Certified as Outstanding Health and Productivity
Management Company
As part of efforts to promote health management, the JAL Group has actively
participated in the Certified Health and Productivity Management Outstanding
Organizations Recognition Program designed by the Ministry of Economy, Trade andIndustry of Japan. In fiscal 2015, the first year of the program, JAL was awarded withhealth and productivity certification. In fiscal 2020, eight companies including JAL
were certified as White 500 for Outstanding Health and Productivity Management,
and four companies were recognized in the large enterprise category. By considering
employee health management from a management perspective and implementing
strategic health management, we aim to revitalize our organization by improving
employee vitality and productivity, and thereby improve our business performanceand stock price. We will continue to work to communicate and contribute to society
through promotion of health and productivity management.

JAL Wellness 2025 MyBook

JAL REPORT 2021

92

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernancePeoplePeopleRespect for Human Rights

Human Resources Development

Basic Concept

Basic Concept■ The JAL Group will fulfill its responsibility to respect human rights for all people based on the belief that■ As individual growth will lead to organizational growth and sustainable growth of the company, employee

respect for human rights is a universal value and is consistent with the realization of the Corporate Policy.

engagement is of great importance, that is, to understand and empathize with the corporate vision and to
think, act and contribute autonomously towards the vision.
The JAL Group will actively invest in human resource development to enhance employee engagement.

Specific Initiatives■ Framework for respecting human rights

HRDD
1. Confirmation/revision of Human
Rights policy
2. Human Rights risk assessment

Risk
reporting

3. Human Rights risk evaluation/
extraction of issues

5. Establishment of improvement
plans regarding the important issues
6. Implementation of the improvement
plans regarding the important issues
Instruction Management
Review(President)
Reporting

8. Reflection of the review details toimprovement plans of the following year

Flow for Human Rights DD Initiatives(We follow this flow each fiscal year to promote respect for human rights.)

The JAL Group aims to become an autonomous team through“JAL OODA” (Observe, Orient, Decide, Act) and has conducted
implemented awareness reform of managers and various
activities to practice JAL OODA. One such example is the W-PIT
activity* launched by young employees, in which they challengethemselves to co-create new businesses with other industries
and conduct in-house ventures leading to “exciting” businesses.
Furthermore, since 2017, we have been holding an intraentrepreneur new business contest called “Sozo no Tsubasa”(Wings of Creation). Winners
have been transferred to thebusiness creation department
and are working to realize theirideas.

■ Initiatives to prevent human trafficking
A particularly important human rights issue for the JAL Group is unintended involvement in human trafficking through airtransportation. To prevent human trafficking, in fiscal 2021 we showed videos to raise awareness of human trafficking prevention
on board JAL Group domestic and international flights, in cooperation with “It’s a Penalty Tokyo Campaign” sponsored by the U.K.
NPO, It’s a Penalty, and co-sponsored by General Incorporated Association Sport For Smile. In addition, we are conducting a training
program for all employees on respect for human rights including the prevention of human trafficking.

Going forward, we will further improve the quality of educationand training using digital technology to promote participation andadvancement of diverse human resources and develop humanresources to support sustainable growth of the JAL Group.

* Abbreviation for Wakuwaku (exciting)Platform Innovation Team

Employee who started W-PIT■ Expanding online education and training courses
Seizing the opportunity brought about by the current harshbusiness environment to develop human resources, we are
increasing the number of training courses and creating anenvironment where employees around the world and employeeswith disabilities can participate online. As a result, the number ofeducation and training hours per person in fiscal 2020 reached276.5 hours, about four times as much as the previous year.

Human resource development outside the company

The JAL Group is focused on educating university students inorder to pass on knowledge and experience cultivated in theairline business. While deepening their understanding of theairline business, we would like to develop human resources who
can contribute to not only transportation and tourism but also
development of a wide range of industries and thereby contributeto energizing regional economies andindustries. We are also expanding
the scope of our education business
utilizing the know-how cultivatedthrough educational activities such as
lectures at universities and seminars
for the general public.

■ Autonomous Career Design (New CAREER Page)
In order to encourage employees to develop their own careers,
we have established a site on the Group intranet called CAREER
Page, which provides information on designing your career(duties, vision and mission of each department, career path of
employees). We also hold online JAL Career Talk Live programs,
where JAL Group employees discuss their careers, to give
employees the opportunity to think about their own career.
The Cabin Attendants Division has begun trialing a system forproviding consultation on career design by professional career
consultants.
We will continue these efforts to create an environment, where
employees can design their own careers.

Participant in JAL CAREER TALK LIVE

Data Book

The JAL Group continues to promote understanding of LGBTQ. We were awarded the highest“Gold” award for five consecutive years in the PRIDE index, which evaluates initiatives for
LGBTQ and other sexual minorities of companies and organizations, established by thevoluntary organization “work with Pride”.
Since October 2020, we have changed announcements at airports and in the cabin from “ladies
and gentlemen” to gender neutral terms, “everyone” and “all passengers” depending on thecontext.
We will continue to provide services that respect diversity.

JAL REPORT 2021

We have established a guideline on the skills and characteristics
expected of JAL Group employees based on the JAL Philosophy,
and exchange human resources across companies and job types
in the JAL Group. By providing specialized training for each job
type and education and training unique to each company, weare developing leaders and safety and service professionals.

Medium Term Management Plan

9. Reporting internally/externally■ Promoting understanding of gender equality and LGBTQ

93■ Developing autonomous employees (in-house
recruitment, etc.)< Main Education and Training Programs >· New Employee Orientation· Leader’s Workshop· JAL Philosophy Workshop· Training for Managers· Career development training by age group· Business skills training courses

4. Dialogue with stakeholders/confirmation of important issues

7. Implementation status review of
improvement plans■ Human resource development programs to
support activities of diverse human resources

The JAL Group Value Creation Story

Grievance
Handling
Mechanism

Specific Initiatives
Foreword

In order to promote respect for human rights, the JAL Grouphas established internal regulations outlining a frameworkfor human rights due diligence (Human Rights DD) and agrievance handling mechanism.
Based on these regulations, we conduct an annual humanrights risk survey of all JAL Group companies, and then assess
risks, extract issues, and identify those that are of particularimportance through dialogue with external experts, and takeconcrete action to eliminate negative impacts on humanrights. Currently, we have defined priority issues in the value
chain; supply chain management, products and services, andthe internal environment, and have disclosed them on the JAL
website.
For example, one of the issues affecting human rights during
the pandemic was preventing infection among employees.
In addition to encouraging remote work mainly in support
departments and reducing the percentage of employees
commuting to the office, we have established rules on coming
to and leaving work and a policy on social distancing based on
guidelines of the Ministry of Health, Labour and Welfare andpublic organizations, and are continuously taking action toprotect our employees. In June 2021, we began a workplacevaccination program to prevent the spread of COVID-19.

Going forward, the JAL Group will continue to improve Human
Rights DD and grievance handling mechanisms to increase
their effectiveness and fulfill our responsibility to respect thefundamental human rights of all people through specific initiatives.

From CAREER Page

JAL REPORT 2021

94

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernancePeoplePeopleImproving Accessibility

Preventing the Spread of Infectious Diseases

Basic Concept

Basic Concept■ The JAL Group has established the JAL Group

Accessibility Service Policy to “create a society
where everyone can enjoy life through travel.”■ Based on this service policy, we are promoting

initiatives to improve accessibility focused onfour areas: development of an environment forusers, promotion of accessible tourism, provisionof information, and education for employees.

JAL Group Accessibility Service Policy
Based on the JAL Philosophy, which defines the basic attitude of employees, we will:
2. offer a variety of travel options toall our customers; and3. co-create enjoyment and delight through travelwith customers and society.

Specific Initiatives■ Development of an environment for users

Wheelchair de Hawaii TourWe have been expanding JAL SMART AIRPORT* services to
hub airports in Japan since 2020. By installing self-service
check-in kiosks and Self Baggage Drop (SBD) with a touchlesssensor on the screen, customers can check in touch-free at the
airport. At Haneda Airport, we are trialing a remote-controlled
robot to assist customers remotely
via the robot. For international
flights departing from Narita andHaneda airports, we have introduced
JAL FaceExpress for smooth andcontactless boarding using facialrecognition technology.
3

We not only take precautionary measures to prevent the spreadof infectious diseases at airports and in aircraft cabins but
also provide pre-travel and post-travel support to ensure thecustomers’ peace of mind. For domestic flights, we offer JAL
1
PCR Test Service* , which is inexpensive, easy and convenient2
to use. For international flights, we offer JAL Covid-19 Cover* ,which covers medical, treatment and accommodation expenses
in case customers test positive or have close contacts.

< Introduction of services available on mobile devices >With the aim of ensuring safe, secure andsmooth international travel, we trialed
mobile apps displaying digital COVID-19
test certificates. In international lounges
at Haneda and Narita airports, we are also
conducting trials of a self-ordering system via
smartphone, and in JAL-operated lounges inJapan, we have introduced an e-library forguests to read their favorite e-books on theirmobile devices.

Ordering system
via smartphones inlounges

  https://press.jal.co.jp/en/release/202012/005903.html

Data Book

JAL REPORT 2021

< Expansion of JAL SMART AIRPORT >Airport, Itami Airport, Fukuoka Airport, Naha Airport

Airport Experience Program (online)

First in Japan to receive highest certifications for infectious disease
precautionary measures from two external organizations
JAL became the first airline in Asia to receive the world’s highest awards* from two externalorganizations for providing the highest levels of safety and security measures. Each audit covereda wide range of assessment items including staff service with consideration for infectious diseases
and provision of easy-to-understand information. JAL’s hygiene and cleanliness standards andtouchless, self-services and travel assistance were highly recognized.

■ Education for employees

95

JAL was the first airline in Japan to apply antiviral andantibacterial coating at all customer touchpoints including JAL
PLAZA (city ticket counter), airports, lounges, and aircraft cabins.
Going forward, we will establish new cleanliness standards
based on specialized knowledge, inspect manual cleaning
procedures, and welcome customers in a clean and hygienic
environment.

  https://www.jal.co.jp/jp/en/dom/option/pcr-srv/*1
  https://www.jal.co.jp/jp/en/inter/jalcoronacover/2**3 Available airports: Five hubs in Japan; Haneda Airport, New Chitose

https://www.jal.co.jp/jalpri/deals/info.html

We continuously educate our employees to deepen their understanding of the needsof people with disabilities and foster a barrier-free mindset. During the pandemic, we
educated them on appropriate ways of serving customers to prevent the spread of
COVID-19 and ensuring a safe and comfortable journey for all passengers.
We also hold sign language classes conducted by JAL Group employees with hearing
impairment to improve sign language skills among employees.

■ Touchless and self-services using the latest
technologies

Medium Term Management Plan*

■ Enhanced hygiene and cleanlinessprecautionary measures at touchpoints■ Support to ensure a safe and comfortablejourney for all passengers■ Provision of information
We are working to improve provision of information to erase any worries before
a trip. The JAL website provides boarding details and enjoyable travel articles* forcustomers who request special assistance.
We also offer an Airport Experience Program that navigates the flow from reservations
to boarding in order to relieve concerns. This program includes individual consultation
time to eliminate individual concerns through direct communication. It was held
online during the pandemic.

Specific Initiatives

Remote controlled robot

We offer special tours for people with disabilities (accessible tours) so that theycan enjoy a variety of travel options. Last year, we held a Hawaiian surfing tour forwheelchair users. JAL Dynamic Package offers a special plan* for guests to use thehotel’s Universal Design (barrier free) room whenever they like to make their trip moreenjoyable.
https://www.jal.co.jp/jp/en/domtour/jaldp/universal_journey/■ Support to ensure a safe and comfortable journey for all passengers

A “Welcome Information” card that provides information on
in-flight announcements to customers with hearing impairment■ Promotion of accessible tourism*■ Touchless and self-services using the latest technologies

The JAL Group Value Creation Story

In order to ensure the comfort of all passengers, we have introduced a “Welcome
Information” card and provide subtitles and audio service for video programs. In
addition to support tools at airports such as wooden wheelchairs and MIRAI SPEAKER,
designed for people with and without hearing impairment for delivering crisp, clear
sound, in 2020 we renewed domestic flight counters at Haneda for customers
requesting special assistance through the development of smart airports (JAL SMART
AIRPORT) that deliver convenience and comfort in air travel. In fiscal 2021, JAL SMART
AIRPORT services were expanded to Sapporo (New Chitose) Airport, Osaka (Itami)
Airport, Fukuoka Airport and Okinawa (Naha) Airport.

■ Enhanced hygiene and cleanliness precautionary measures

Foreword

1. provide stress-free travel for all
customers:

The JAL Group is implementing JAL FlySafe hygiene measures
based on the following three points with top priority on
ensuring the customers’ safety and comfort.

https://press.jal.co.jp/en/items/uploads/a74140652a1bee34e707fb3896f0184fc81f0620.pdf* JAL received the highest COVID-19 Safety Rating from SKYTRAX and the highest certification in the Health Safety powered by SimpliFlying Audit conducted by the Airline
COVID-19 safety measures (example)

Passenger Experience Association (APEX). The audits cover not only hygiene and cleanliness but also infectious disease measures in general, such as touchless and automation
technology and travel assistance. As of June 30, only two airlines including JAL have received both of these awards.

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernanceCommunities
Basic Concept (JAL Group Code of Conduct)

Mission and responsibility as a member of society
We are grateful to play a role in delivering social infrastructure andrepay our gratitude by fulfilling our mission as a public transport
operator.

(3) Responsibility as a corporate citizen
The JAL Group contributes to solving social issues and promotingsocial development as a corporate citizen by nurturing the next
generation, supporting culture and sports, cooperating with disasterrecovery operations, and through regional exchanges, international
cooperation and other activities.

Increasing InboundTourism

Improving Conveniencein Travel

●
●

TOPIC

Regional activities throughout
Japan by cabin attendants

P.45-50, 99
https://www.jal.com/en/sustainability/community/network/

P.45-50, 99● https://www.jal.com/en/sustainability/community/inbound/●

P.57, 99
● https://www.jal.com/en/sustainability/community/maas/●

Regional Revitalization

JAL FURUSATO Ambassadors are cabin attendants who havebeen selected from among applicants with a strong desire to
revitalize their hometown or regions with which they haveclose ties. They actually relocate to these areas and use theirknowledge to create content and develop products utilizing
local resources, in cooperation with the local government,
tourism association, Destination Management and Marketing
Organization (DMO) and local producers.

P.55, 99-100● https://www.jal.com/en/sustainability/community/regional_revitalization/●

Regional Revitalization

For cabin attendants

P.101-102● https://www.jal.com/en/sustainability/community/community_relations/●

Community Relations

FURUSATO Ambassadors

FURUSATO Cheering Teams

19 persons

1,000 persons

For all JAL Group staff

Disaster Assistance
Restoration

P.102● https://www.jal.com/en/sustainability/community/disaster/●

Regional Communities byPrefecture FURUSATO no“WA” (harmony)

A program for employees to participate
in local communities which they are
related to or interested in, and tocommercialize ideas or turn their ideas
into a regional revitalization project.

https://www.jal.com/en/sustainability/codeofconduct/

Regional Revitalization

Energize regional areas in Japan!
Bring smiles!
JAL FURUSATO PROJECTJAL FURUSATO PROJECT Website
https://japan.jal.co.jp/

Deliver cheer and smiles of my hometown
to everyone
After leaving my hometown in Aomori, I visited cities
around the world and was reminded of the wonderfulpeople, culture and nature in Aomori. When I learned
about the opportunity to become an Ambassador andcontribute to my hometown, I decided to apply.
Currently, I am involved in product development using local
specialties and PR activities while strengthening bonds withthe local community. To most people, Aomori brings tomind apples, but it has many
delights that are still unknown.
Going forward, I will thinkof what I can do together
with the local community
to contribute to sustainable
development during and post
COVID-19, convey the charmsof Aomori, and deliver cheer
KASAI Eriand smiles of my hometown
JAL FURUSATO Ambassador
In charge of Tohoku Region,
to everyone.
Regional Ambassador OfficeCommunity Relations< Fostering the Next Generation - JAL SORAIKU® >Full renovation of JAL SKY
MUSEUM
The Sky Museum located in the Haneda Airport MaintenanceCenter Building is open to the public as a hands-on activity
facility of JAL SORAIKU®, which is part of our activities as acorporate citizen. Visitors can get to know jobs in an airline
and JAL Group’s history and see real airplanes up close.
We have had more than 120,000 visitors ranging fromelementary school children to senior citizens. Recently theexhibition area underwent a complete renovation based on
the concept of “have more fun.” In addition to renewing
the exhibition method and introducing large multi-displays,
current employees displayed on a life-size monitor explain
their jobs and a new digital chronology using historicalmaterials explains the history and future of aviation in Japan.

Data Book

After the launch of the JAPAN PROJECT in May 2011, theJAL Group has been working since September 2015 on the
NEW JAPAN PROJECT to revitalize regional areas, focusedon industry and tourism promotion of all 47 prefectures andmunicipalities through regional promotion activities andproduct development utilizing local resources.
In April 2021, we upgraded these activities from the NEW
JAPAN PROJECT to the JAL FURUSATO PROJECT. As an airlinethat connects people, goods and regions, we would like tofurther strengthen our relationships with regional areas andaddress regional problems through the joint efforts of all
employees who have special thoughts about their FURUSATO(hometown).
Based on the keywords, “joint efforts, originality andcontinuity,” we will promote various initiatives to meet
diverse regional needs and revitalize local communities andeconomies.

TOPIC
The logo is designed based on the concept of “connecting” with FURUSATO (hometown)
and the double lines represent travel to and from the region in addition to symbolizing
the aircraft contrails.

VOICE

Medium Term Management Plan

TOPIC

Each JAL FURUSATO Cheering Team has about 20 members
from each of the 47 prefectures, who are recruited internallyto provide detailed support for regional vitalization. Alongwith flight duty, they participate in local events and planand publicize local products, through which they discovereven more local delights, build bonds with the people, andrevitalize the local community.

The JAL Group Value Creation Story(2) Responsibility as a company that plays a role in social infrastructure
The JAL Group conducts organizational risk management to beprepared against terrorism, cyber-attacks, natural disasters and otherevents that threaten civil life and corporate activities. In the event ofa natural disaster, we make efforts to resume air transport services
as quickly as possible, cooperate in disaster recovery efforts throughair transport, etc. and fulfill our social mission and responsibility as apublic transport operator that plays a role in social infrastructure.

Route Network
Expansion

Initiatives

Foreword(1) Contributing to regional revitalization through our business
The JAL Group contributes to the sustainable development ofregions across Japan that support our air transportation business. To
achieve this, we make efforts to enhance the appeal and value ofregions using our know-how accumulated in the aviation businessand networks, and contribute to vitalizing regional economies by
expanding the distribution and flow of people and goods.

Priority issues

JAL Factory Tour -SKY MUSEUM- Homepage (closed as of September 2021)
https://www.jal.co.jp/kengaku/

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Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernanceCommunities

Route Network Expansion

P.45-50https://www.jal.com/en/sustainability/community/network/

Communities

Increasing Inbound Tourism■ Product development using local specialties

P.45-50https://www.jal.com/en/sustainability/community/inbound/

Communities

Improving Convenience in Travel

P.57

https://www.jal.com/en/sustainability/community/maas/* Specific initiatives are detailed above.

Regional Revitalization

born and raised, and FURUSATO in our hearts, and carry out activities to create sustainable communities.

Specific Initiatives

Unfiltered Apple Juice recreates the crispnessof apples.
Available in JAL First Class from April 2021

recommended JALPAK tours.
Since April 2021, we have been publishing articles on our
web magazine “OnTrip JAL” of the charms of Japan’s
regions by our reporters, JAL FURUSATO Ambassadors
and JAL FURUSATO Cheering Teams, and have been
showing in-flight videos of JAL FURUSATO Cheering Teams
introducing local sightseeing spots and delicious cuisine on“JAL on YouTube.”

In order to adjust to changes in behavior during and post
COVID-19, the JAL Group is offering new ideas for travel incooperation with local companies by mutually combining ourassets, knowledge and know-how on tourism.
In Hokkaido, JAL FURUSATO Ambassadors utilized thecharms of their hometowns and their knowledge of travelacquired through flight duty to plan “travel products focusedon regional charms” and “new travel products that ensure
safety and comfort during the pandemic.” They will continue
to plan inspiring tours and safe and comfortable tour
packages for inbound visitors, in anticipation of the recovery
of inbound demand.

■ Passing on traditional culture and protecting
the natural environment

and Iriomote Island” to the World Natural Heritage list in July
2021, we opened a special World Heritage site on the JAL
website; featured World Heritage Sites and specially painted
aircraft under the theme of “connecting” on our web
magazine “OnTrip JAL”; and introduced all World Heritage
Sites in Japan including the recent two listings and special
tours on our domestic tour site.
Going forward, we will continue to contribute to passing on
Japan’s natural and cultural heritage, which we take pride in,to the next generation through travel and PR.

Data Book

The JAL Group has supported efforts to protect the naturalenvironment and pass on traditional Japanese culture,such as support for Upopoi, a space symbolizing ethnic
coexistence for the purpose of cultural restoration anddevelopment of the indigenous Ainu people of Hokkaido,
and beach clean-up activities in Amami and Okinawa.
To commemorate the registration of “Hokkaido andNorthern Tohoku Jomon Period archaeological sites” to theWorld Cultural Heritage list and “Amami-Oshima Island,
Tokunoshima Island, the northern part of Okinawa Island,

Opened a special website introducing
and selling tours available from May
2021 to October 2021

Medium Term Management Plan

Tokushima was featured in July 2021.

Aomori Blackcurrant
Frozen Yogurt

The JAL Group Value Creation Story■ We would like to create new value by strengthening bonds with FURUSATO (hometown), where we were

The JAL Group has conducted a total of 125 regional
promotions up till September 2021 since the launch in May
2011. Through collaborative initiatives with local restaurants
and Japanese-style restaurants, in-flight meals for domestic
First Class use an array of local ingredients, while ourin-flight magazine “SKYWARD” features articles on thevarious regional charms of Japan, such as recommended
sightseeing spots, local products and traditional crafts, andGarlic and Japanese
Basil Oil Sauce■ Ideas for new travel

Basic Concept■ Regional Promotions (monthly activities)

across Japan and over our social media and in-flight magazine.
Going forward, we will continue to introduce attractive
products through collaboration with various regions.

Foreword

Communities

Japan that stretches from north to south has a rich history ofregional dishes, nurtured by the rich natural environment of
the different seasons. The JAL Group is working to develop,
introduce and commercialize products using attractive local
specialties throughout Japan.
For example, in Aomori Prefecture, one of Japan’s leading
agricultural prefectures blessed with abundant water resources
and a cool climate, we drew our attention to Japan’s largest
production of garlic and blackcurrants in addition to apples,
which they are known for. We developed three products,
Unfiltered Apple Juice, Garlic and Japanese Basil Oil Sauce,and Aomori Blackcurrant Frozen Yogurt, in cooperation with
manufacturers, and conducted sales promotions at retail stores

In-flight meals served in domestic First Class using ingredients from Tokushima under
the supervision of a local restaurant

Opened a special site to commemorate the listing of World Heritage
Sites on the JAL website

Introduction of World Heritage Sites and sales of tour packages

https://www.jal.co.jp/jp/en/dom/special/sekaiisan/

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Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G GovernanceCommunities

Community Relations■ Support for culture and sports
Challenge for Tomorrow School

Basic Concept■ As a good corporate citizen, the JAL Group engages in a variety of activities that leverage JAL Group’s strengths

in order to build better relationships with our stakeholders and contribute to the betterment of society.

Specific Initiatives

Launched in April 2017, the Challenge for Tomorrow School, which JAL
cosponsors to let everyone shine through sports, held its 1,000th eventon October 20, 2020.
In fiscal 2020, events were suspended for a certain period of time, but inorder to “provide children with opportunities to experience para-sports
and live with dreams and hopes,” we established safety guidelines in
addition to national and local government laws to provide safe andsecure learning opportunities.

■ JAL SORAIKUStart of online classes

Foundation Paralympic Support Center

Virtual JAL Factory TourWe also started virtual JAL Factory Tours online to allow
participants to experience JAL Group’s history and jobs ofairline staff and see real airplanes up close. We offer new
experiential value through factory tours and online classes
from home.

2019

2020

Number of people

197,469

191,840

20,4352019

2020

Results (past 3 years)
Fiscal year

2018

2019

2020

Number ofart exhibitions(times)41

27

6

Cabin attendants based in Bangkok support studies at local schools for visually
impaired students by reading aloud to children. The mobile app used in these
activities has since been widely used by people with visual impairment in local
communities.

JAL SORAIKU participants (past 3 years)
2018

We cooperate in the transportation of paintings, sculptures and otherartworks displayed in art exhibitions using our air freight networks andtechnologies. In addition to creating opportunities for the Japanesepeople to see artworks and art, it also plays a role of disseminating
Japanese culture overseas.

2018

Reading by cabin attendants®

Fiscal year

Support for art exhibitions

Fiscal year

Participating
296 schools
287 schools
129 schools
schools
Number of (46,253 persons) (41,889 persons) (12,559 persons)peopleThe JAL Group Value Creation Story

JAL SORAIKU® aims to provide opportunities for children tothink about their own future and the future of the global
environment by experiencing the wonders of the sky and thefun of flying. The program offers origami plane classes, classes
on jobs in an airline, and Sky Eco classes. In fiscal 2020, asclasses could not be held face-to-face due to COVID-19, welaunched online classes to allow children to participate easily
from anywhere. Through quizzes, we introduce behind-thescenes stories of jobs performed by airline staff and scenes
from training that are not usually shown.

Results (past 3 years)

Foreword* Para-athlete hands-on activities for elementary, junior and senior high schools sponsored by the Japan®

Photo courtesy of The Nippon Foundation Paralympic Support Center

Communities

To develop educational content based on insights into the airline business utilizing
know-how accumulated through our educational program for the younger
generation, JAL SORAIKU®, JAL submitted an application to become a content creator
for the 2020 Ministry of Economy, Trade and Industry “Future Class” STEAM* LibraryBusiness and was the only airline to be selected. Under the theme, “Thinking of theairline industry 10 years from now ~ History and Future Vision Based on Climate
Change,” we created and provided an educational program that is widely used inschools and educational institutions.
* S TEAM: A universal educational method that comprehensively studies Science, Technology, Engineering, Art andMathematics. It is an educational philosophy that adds creativity to science and mathematics, and refers to crossdisciplinary learning that creates a cycle of learning (exploration) and creation.

Basic Concept■ In order to fulfill our social mission and responsibility as transportation infrastructure, we cooperate in theearly resumption of air transport services and air transport for disaster relief operations. We are also providing
continuous support to those affected in disasters.
Ministry of Economy, Trade and Industry’s STEAM
Library Future Class webpage
https://www.steam-library.go.jp/content/2

FY2020 Support Results

During Breast Cancer Awareness Month, pilots also wear apink epaulet to raise awareness.

Heavy rains
in July 2020

Charity miles

Employeefund-raising

11,328,500 miles

1,431,415 yen

In typhoon-affected areas where town watersupply has been cut, we sent JAL specialized
snow removal trucks that can carry hot water toallow people to bathe. (2019)

JAL REPORT 2021

Data Book

101

Specific Initiatives
In the recovery phase immediately after a disaster, we strive to resume air transport early in order to fulfill our social mission andresponsibility as transportation infrastructure. We also cooperate with the national and local government, and the network of NGOs
and NPOs to transport emergency supplies and volunteers to disaster stricken areas. JAL also organizes a charitable mileage programfor JAL Mileage members to donate their miles and fund-raising activities by employees.
In the reconstruction phase, we work with the local government to promote local industries and create tourism demand though PR
of local products and other activities.

■ Supporting the health of the next generation and women’s healthIn support of the Japan Committee for UNICEF’s “Protection of Children’s Lives, Healthand Rights,” we have been cooperating in collecting donations on board flights andtransporting foreign currency coins since 1991 using the characteristics of an airline.
From fiscal 2004, we began breast cancer awareness campaign activities every October toraise awareness of the importance of early detection and screening test for breast cancer.
In international exchange activities, we are working in cooperation with the JAL
Foundation to conduct activities and cultural exchanges to foster the sensitivity of children
around the world. The JAL Scholarship Program invites university students from the AsiaOceania region to Japan to interact with Japanese students and conduct research on a
specific theme to deepen mutual understanding across national borders.

Medium Term Management Plan

Disaster Assistance Restoration

Developed educational content for the Ministry of Economy, Tradeand Industry’s STEAM Library

In front of Akita Bisaikan, an antenna shop of
Akita Prefecture in Tokyo (2020)

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Governance
Basic Concept (JAL Group Code of Conduct)

Trust with stakeholders
The JAL Group ensures fair disclosure of information while
maintaining constructive dialogue with a board range ofstakeholders in order to achieve sustainable growth and increase
corporate value.
(1) Information disclosure and dialogue(2) Prohibiting insider trading

Priority issues

Initiatives●

Fair Business Practices●●

Disclosure

●

P.106
https://www.jal.com/en/sustainability/
governance/information-disclosure/●●●P.107-108
https://www.jal.com/en/sustainability/
csr-procurement/

P.109-112
https://www.jal.com/en/sustainability/
governance/bcm/

Fair Business Practices

I am currently working as ground crew using my experience
as a cabin attendant to purchase cups and dishes thatpassengers use on board. From the end of last year to springof this year, I was responsible for introducing paper cups
made of FSC® (Forest Stewardship Council) certified paperfor serving hot drinks in First Class on short-haul domestic
flights. As the raw material for making the paper cups was
special and different from ordinary paper products, a higher
price was inevitable if we were to use FSC® certified paper.
However, by changing the specifications while maintaining
quality and the delivery method in collaboration with the
supplier while coordinatingwith internal departments, wewere able to purchase paper
cups made of FSC® certified
paper at an appropriate
price. I will continue tooffer quality assurance tocustomers and introduce
certified commodities thatgive due consideration to
the environment and human
KOJIMA Marirights while keeping in mind
Goods and Materials ProcurementGroup
profitability.
General Procurement

The JAL Group Value Creation Story

Robust Risk
Management(Promotion of BCM)●

We are working together with our suppliers to use FSC®
certified cabin service goods from the perspective of building
a sustainable supply chain, including regulatory compliance,
global environmental protection, respect for human rights,
fair labor practices, and fair business practices.
We will continue to work to increase the use of productsthat have acquired international certification.

VOICE

Foreword

TOPIC

Responsible
Procurement

Responsible Procurement

Providing cabin service goods
using FSC® certified paper

P.105
https://www.jal.com/en/sustainability/
governance/fair-business-practices/

Fair business practices
We comply with laws and rules and conduct ourselves with honesty
and integrity as a member of a company that is genuinely trusted
by society.
(1) Reinforcing compliance(2) Preventing corruption(3) Fair business relations with business partners(4) Free and fair competition(5) Management of personal information and intellectual property(6) Eliminating relations antisocial forces

TOPIC

Information security to protect the personal information of our customers

VOICE

103

JAL REPORT 2021

TAKAKI ShojiSocial Risk Management Group
Risk Management

Robust Risk Management(Promotion of BCM)

To maintain business continuityof important businesses in caseof a large-scale disaster
Since 2005, when the Cabinet Office of the Government ofJapan published Business Continuity Guidelines, BusinessContinuity Management (BCM) and a Business Continuity
Plan (BCP) have become increasingly widespread in Japan. In
particular, the experience of the Great East Japan Earthquake
in 2011 and publication of international standard ISO
22301 have led to rapid proliferation of BCP formulation bycompanies and renewed recognition of its importance.
The JAL Group has also established a BCM system, formulateda BCP, and established and documented strategies toensure that air transportation, which is a vital business, canbe restored within a targeted time frame even if businessis disrupted by a serious event. We will review the content
according to environmental changes, disseminate our business
continuity policy and strategies to internal organizations, andconduct education and training regularly to strengthen disaster
response capabilities to ensure optimal decision-making andactions in the event of an unpredictable serious disaster.

VOICE
A report has predicted that there is a 70% chance of amajor earthquake striking the capital region in the next
30 years. To be prepared, we conduct drills each quarterfor all employees including executives to ensure business
continuity and fulfill our social responsibility as a public
transport operator even if JAL’s central organizations,
namely, JAL Head Office and Haneda Airport, were to
be hit by a magnitude six earthquake and suffer major
damage. We also conduct company-wide drills acrossdivisions and instruct each division to conduct drills
in teams in order to instill knowledge and actions to
be taken in the event of adisaster.
Although it is extremely
difficult to find the best way
to achieve business continuity(restoration), we will strive
to enhance effectivenessand effectiveness of our BCP
through close communicationand coordination among
MIURA Kanako
divisions that are intricately
Risk Management Group
Risk Management
interrelated.

JAL REPORT 2021

Data Book

As many customers use JAL Group services each day, it is extremely important that every
employee who handles information maintains a high awareness of information security andprotection of personal information.
For this reason, all employees are periodically educated on information security and undergo
targeted email attack drills.
Furthermore, in cooperation with IT Planning, our department visits domestic and overseas
offices and airports to check whether information security is handled according to
information security standards and rules, identify risks early, take necessary measures, andthereby strengthen information security throughout the JAL Group.
We particularly keep in mind to communicate with frontline staff, together think of measuresfrom the frontline perspective, and build a trusting relationship.
We often receive ideas and suggestions from workplaces on new services using personal
information. However, in order to eliminate potential security risks and guarantee safety of
personal information, it is difficult to determine the extent permissible and strike a balance
between convenience and personal information protection.
We will maintain awareness that we are entrusted with important information of customers
and strive to ensure information security and keep our customer data secure to ensure
customers can use our services with peace of mind.

TOPIC

Medium Term Management Plan

The JAL Group handles a large amount of customer information every day in various situations, such as reservations and airports,
when flying.
Going forward, we will continue to position information security as one of the most important issues, and will promote various
measures from both a tangible aspect, including systems for detecting and auditing external threats, such as increasingly
sophisticated and complex cyber attacks, as well as an intangible aspect, including increasing employees’ awareness of this issue.

104Chapter2

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Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Governance

GovernanceFair Business Practices (Compliance)

Disclosure

Basic Concept

Basic Concept■ The JAL Group conducts business activities incompliance with applicable laws and regulations.
■ In order to strengthen compliance, JAL Group

employees act in accordance with the JAL Group
Code of Conduct “Commitment to Society” andpractice the JAL Philosophy.

■ The Risk Management Department of Japan■ The JAL Group great importance to disclosure in business and discloses a wide range of information on the

Airlines is positioned as the department incharge of overseeing compliance throughout the
JAL Group and works to raise staff awarenessthrough various measures.
■ We will maintain awareness of issues andproactively implement timely measures, while
paying attention to social trends.

JAL website, such as the Fundamental Policies of Corporate Governance, the Corporate Policy, company
profile, safety and quality information, sustainability information, and investor relations information, inorder to provide stakeholders with an understanding of our corporate stance. The JAL Group Safety Reportprovides our stance and approach to safety, and the annually published JAL REPORT (this report) is an
integrated report that comprehensively covers financial and sustainability information. A broad
spectrum of information is immediately disclosed on the JAL website, and the JAL REPORT outlines
important matters.

Specific Initiatives【JAL Group Safety Report】https://www.jal.com/en/flight/report/

Foreword【JAL website】https://www.jal.com/en/

Specific Initiatives■ Developing an environment for promoting
compliance① Related regulations and handbook

https://www.jal.com/en/sustainability/governance/fair-businesspractices/

Furthermore, a director of each JAL Group company isappointed as Chief Compliance Officer and by establishing
the JAL Group Compliance Network, we achieve clarificationof roles and responsibilities, timely exchange of information,and development of compliance measures.

In order to realize the JAL Group Code of Conduct“Commitment to Society,” we are enhancing education
through face-to-face courses and e-Learning, such ascompliance education for all employees (twice a year) andseminars for officers and by job grade.

https://www.jal.com/en/sustainability/governance/fair-businesspractices/

Anti-corruption measures
In order to seek fair and just profit, the JAL Group Codeof Conduct “Commitment to Society” declares ourcommitment to “prevent corruption” in order to intensify
crackdown on corrupt practices and prevent money
laundering.
With the expansion of global business activities, we also
comply with applicable laws and regulations of countries
and regions where we conduct business (domestic laws
such as the Unfair Competition Prevention Law (Japan),Foreign Corrupt Practices Law (U.S.), Bribery Prevention
Law (U.K.), Commercial Bribery Regulations (China)) andinternational conventions, and promote efforts to prevent
corruption as a corporate citizen.

■ Providing information
To provide our stakeholders with a deeper understanding of the latest situation, we are working to improve the quality of disclosuresand build relationships of trust through two-way communication. In recognition of our proactive approach to information disclosure,the Securities Analysts Association of Japan (SAAJ) has awarded the JAL Group first place in the transportation category for the thirdtime in the past four years as a company with excellent disclosure.
Further, when COVID-19 infections began to run rampant around the globe in spring of 2019, many people were worried about
using public transportation and many investors were concerned about the risk of infection inside the cabin. We prepared financial
results briefing materials that were easier to understand and had a stronger message, and using the hand-drawn illustration below
to promote cabin safety, we were awarded the IR Good Visual Award sponsored by the Japan Investor Relations Association inrecognition of the drawing’s high quality, creative and unique presentation.
Despite the extreme difficulty of disclosing our earnings forecast for fiscal 2020 due to COVID-19, we have been commended for our
stance on disclosure. For example, the announcement of the Company’s first quarter financial results was highlighted as an example
of good disclosure by the Tokyo Stock Exchange for providing detailed information on the extent of the impact of the virus.
Going forward, we will continue our efforts to improve disclosure and information quality so that we may realize better dialogue
with stakeholders.
Illustration of air
circulation in cabin
Drawn by frontline staff
to assure customers thatthey can use our aircraftwith peace of mind, it
encapsulates our strong
desire to achieve businessrecovery and ensure
safety and security. The
illustration is available inseveral languages, including
Japanese, English andChinese, and for children.

③ Consultation desk
The JAL Group has established internal and external Group
Hotlines (open 365 days/24 hours, in Japanese and English)
as a whistleblower hotline available to all JAL Group
employees.
Also, each Group company has its own hotline to quickly
spot and handle misconduct in the JAL Group.

Medium Term Management Plan

② Enhancing employee education

We are continuously promoting various activities to raisecompliance awareness, strengthen information security, andreduce legal risks.
Please visit the following site for main initiatives.

The JAL Group Value Creation Story

Regulations are posted on the intranet so that every JAL
Group employee can check them at any time.
For the main regulations and handbook please see below.

■ Promotion of various initiatives■ Number of breaches to Code of Conduct in
FY2020The number of fines and sanctions imposed on our company*
for violations of laws and regulations is as follows.

Characteristics and correlation of our media* Japan Airlines Co., Ltd. and its subsidiaries

Group Hotline (internal contact)

JAL Group staff

FY2020

JAL General Affairs,
Business Risk Management
Group

Bribery (Preventing corruption)0

Antitrust violations (Free and fair competition)

0

Group Hotline (external contact)

Information leakage (Management of personal
information and intellectual property)0

Law firm
Open 365 days, 24 hours

Human rights abuse (Respecting human rights anddiversity)
Insider Trading (Prohibition of Insider Trading)0

Data Book

Frequency of communication

Item (Relevant Code of contact items in parentheses)

As necessary
JAL website
Summary of financial results / Financial results briefing materials

At least
once a year

JAL Group
ESG data

Corporate Governance
ReportSecurities Report

Notice of Convocation of General Meeting of Shareholders

0

JAL Group
Safety Report

JAL REPORT
Once a year

105

JAL REPORT 2021

FINANCEESG

SAFETY

Main content

JAL REPORT 2021

106

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Governance

Responsible Procurement
Basic Concept

Use of Certified Products■ The JAL Group is aware of the need to gain the■ To deliver a sense of security to customers when they

cooperation and support of many suppliers tooperate its flights and provide products andservices to customers on a daily basis. Therefore,
we strive to build strong partnerships with
suppliers based on mutual trust by ensuring
fair and transparent procurement activities andshowing our appreciation for their support.

board our flights, we cultivate a culture of safety as
top priority with our suppliers and conduct rigorous
quality management to offer the finest hospitality.

assess not only the quality, price and delivery
date of their services and products, but also theirreliability, ESG and sustainability initiatives.

supply chains, including initiatives aimed at legal
compliance, global environment preservation,
respecting of human rights, appropriate labor
practices, and fair business practices.

Strengthening cooperation with business partners■ Requests to suppliers for improvement

Approximately 500 companies in Japan and overseas
have been designated as primary suppliers based on
procurement cost and volume, and product importanceand substitutability. We also screen all commodities thatare procured and create a risk map from the viewpoint ofsustainability including the environment, human rights, andlabor to identify those with high sustainability risks.

The results of the self-assessment questionnaires areassessed, and if they do not meet our criteria, we request
suppliers to make improvements. Fulfilment of criteria by aspecified deadline or submission of a corrective action plan
are requirements for continuing business.

ImpactIn-flight
meals andsupplies
Advertising

AircraftHotel shuttle

Maintenance
FacilityIT

Outsourcing

Warehouse

Real estateTransportation Consumables andgeneral goods■ Targets and Results

The potential for problems■ Monitoring and cooperation with business partners

Compliance with JAL Group Supplier Code of Conduct in Fiscal 2020
(percentage by field)
100%
80%

PeriodFY19 to
FY23

Auditing rate of suppliers requiring
audit
Each year

TargetAchievement

100%

63%

100%

37%

100%

No Target

100%

100%

*1	An NPO that provides a platform for managing and sharing ethical supply chain

40%

data with the aim of achieving responsible business practices in the supply chain.
Established in the U.K. in 2004.

■ Further Improvement required

JAL REPORT 2021

■ Compliance Levels met

Safety andSanitation

Human Rights
and Labor

Quality
Assurance

Expansion to
Suppliers

Business
Management

Establishing asystem forinternal initiatives

Contribution
to regional
communities

Environment

20%

107

Soundness confirmation rate of criticalsuppliers

Training rate of procurement staff

60%

0%

Key Performance Indicators (KPI)
Monitoring completion rate of criticalsuppliers

Loungewear for First Class are made of 100% organic
cotton certified by Global Organic Textile Standard (GOTS),
an international standard for organic fibers.

ST Standard (toys)
We are introducing toys that have undergone and passed
ST (Safety Toy) Standard compliance inspections by a thirdparty inspection agency.

(Note) Content shown on receiving FSC® promotional license (FSC® N003038)○ Food certification
Rainforest Alliance certification (coffee)

ASIAGAP certification (vegetables)

In 2011, we began serving sustainable
coffee, using Rainforest Alliance certified
coffee beans, in the cabin and in thelounge, ahead of other airlines.

Since December 2018, we have been serving food certified
by ASIAGAP (good agricultural practices) for Business Classand Economy Class in-flight meals. JAL Agriport, a JAL Group
company, acquired ASIAGAP in November 2019 at its farmand their vegetables have been used in in-flight meals andlounges.

MSC/ASC certification (seafood)Since June 2019, we have been purchasing seafoodcertified by MSC (Marine Stewardship Council) and ASC(Aquaculture Stewardship Council) through AEON Co.,
Ltd. and used them in Business Class in-flight meals.
In February 2020, we became the first airline in theworld to receive MSC/ASC CoC (Chain of Custody)
certifications. We established traceability management
procedures for our in-flight meal catering facilities toensure that we obtain fish
and aquaculture products
from responsible farms andestablished an operating
system to ensure that in-flightcatering companies strictly
observe these procedures.

Data Book

We ask our suppliers to cooperate in conforming to the JAL
Group Supplier Code of Conduct, which defines sustainability
initiatives that give consideration to the environment, humanrights, labor and other issues. Since fiscal 2019, we havebeen asking primary suppliers to respond to Sedex’s*1 SelfAssessment Questionnaire (SAQ) or a JAL questionnaire toverify the status of compliance.

We have completed confirmation of compliance of 37% of
our suppliers by the end of fiscal 2020 and aim to complete
compliance checks of all primary suppliers by the end of fiscal
2023. We will continue to conduct responsible procurement
to achieve SDGs.

GOTS certification (organic cotton)

Since September 2018, we haveintroduced in-flight service goods
certified by FSC® (Forest StewardshipCouncil®). We also ask our suppliers toacquire FSC® CoC (Chain of Custody)(distribution and management
certification). As a result, more than halfof our paper products such as paper
cups, menu cards, in-flight magazines,
confectionery boxes and wooden toys
are FSC® certified products.

Medium Term Management Plan

AirportvehicleIn fiscal 2020, we held online briefings with our suppliers
to introduce our CO2 reduction initiatives and improvetheir understanding of sustainability. We are enhancing
sustainability education for procurement staff, and bearin mind sustainability in procurement processes such as
selection of suppliers and business negotiations. In addition
to quality, price and delivery date, we also assess suppliers
from the perspective of sustainability through self-assessment
questionnaires.

UniformCabinconfiguration
JAL goods■ Conversation with business partners and
ESG management

FSC® certification (paper products)

The JAL Group Value Creation Story■ Identifying primary suppliers and risk products

Airportservices

https://www.jal.com/en/sustainability/certified-products/○ Certifications for cabin service goods

https://www.jal.com/en/outline/client/

Specific Initiatives

Fuel

Use of Certified Products

Foreword■ When selecting suppliers, we comprehensively■ We work with suppliers to build sustainable

In these times when there is growing demand for responsible procurement with environmental consideration for supply chains andworker’s rights, there are various types of certifications that objectively demonstrate that certain requirements are met. The JAL
Group compares and examines the standards of each type of certification and uses international third-party certifications with highrequirement standards regarding the environment, society and governance, and for food, the previous three standards plus safety.

ASIAGAPMSC CoC

ASC CoC

In-flight SDGs menu using ASC certified ingredients ~ A future dish from alist of 50 foods ~■ High Compliance Levels achieved

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Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Governance

Robust Risk Management (Promotion of BCM) BCM: Business Continuity Management
Basic Concept

Specific Initiatives■ In order to protect and enhance public trust as airtransport infrastructure with safety as the basic
foundation of business, the JAL Group strives to achieve
stable Group management through comprehensive
risk management and promotes corporate social
responsibility (CSR) activities.
■ Even JAL Group companies that are not directly

Risk Management System

we have clarified that organizational leaders areheld accountable for risk management and havedefined “risk” as “any event or act that threatens
the achievement of the mission, purpose or goals of
any individual or organization.” Risks are classified
into two groups: “operational risk” relating to airtransportation and “business risk” that is not related
to air transportation, and priority risks are identified
through a biannual risk survey and treated intensively.

PresidentGroup Safety Enhancement Council

Group Risk Management Council

Progress management,
residual risk assessment(includes review, training, auditing, etc.)

6
Responserisks

Business risks

Operational risks

2

Changes in the business environment
domestically and internationallyConfirm the mission, goals,
and targets of eachorganization

Entire JAL Group
Overseasregional
headquarters

Division A
Dept.
A-1

Dept.
A-2

Group
airlineGroupcompany3

We execute regular risk
management cycles
so that each organization canachieve their goals.

Identify risks

54Clarify priority risks

Update the risk map· Risk Survey (For details of each risk and countermeasures, see pages 136 to 138.)
We conduct risk assessments biannually in accordance with the risk management cycle. After classifying
operational risks relating to air transportation and business risks not relating to air transportation into four
categories: recurrent, incidental, external factors and internal factors, we assess the likelihood and severityof each category and create a risk map and treat priority risks of each organization. We also conduct acomprehensive analysis of priority risks of all organizations to identify priority risks of the JAL Group.
Repeated

Repeated

Chaired by the Senior Vice President of Finance andAccounting and comprising the President, Executive Vice
President and Senior Vice Presidents of relevant divisions, theFinancial Risk Committee identifies financial risks to support

109

JAL REPORT 2021

As the subcommittee of the Group Safety Enhancement
Council, the Group Operational Safety Promotion Committee
works to improve air transport safety by maintaining andstrengthening cooperation on safety between divisions andGroup airlines.

Operational risks
Earthquakes, volcanic eruptions and otherlarge-scale disasters, terrorist attacks,
regional conflicts, wars, outbreak and spreadof infectious diseases, etc.

Operational risksLong-term shutdown of Integrated Operations
Control (IOC) responsible for flight dispatch
and scheduling of aircraft all over the world,
aircraft accidents, etc.

Sporadic

Priority risk

Low Medium High Extreme

Probability

Probability

External factors

Internal factors

Priority risk

Low Medium High Extreme

Probability

Priority risk

Low Medium High Extreme

Probability
Sporadic

For priority risks, we implement PDCA of risk
prevention measures.

Data Book· Financial Risk Committee· Group Operational Safety Promotion Committee

Business risks
Changes in foreign laws or regulations, suchas consumer protection and antitrust laws,
litigation, etc.

Low Medium High Extreme

Very large Large Medium Small
Severity

As the subcommittee of the Group Risk Management
Council, the committee plays two roles. To deal with risks ingeneral, the committee chaired by the Senior Vice Presidentof General Affairs and comprising Senior Vice Presidents ofrelevant departments, plays an administrative role to support
the Group Risk Management Council.
The committee is also responsible for personal data
management and information security. Chaired by the SeniorVice President of General Affairs and Senior Vice Presidentof IT Planning, the committee continuously strengthens
information management.

Chaired by the President and comprising the General Safety
Manager and directors and presidents of Group airlines
appointed by the Chair, the Group Safety Enhancement
Council establishes important safety management policies,
grasps the actual state of business activities, and reviews
organizations, systems and measures, as necessary, toachieve Group safety and promote safety management.

Operational risks
Aviation safety problems, shortages of
JAL Group personnel with qualifications
and skills needed for operations, strikes,
computer program glitches, etc.

Very large Large Medium Small
Severity· Group Safety Enhancement Council· Risk Management and Information Security Committee

Operational risks
Changes in fleet plans attributable to aircraft
manufacturers, changes in laws, regulations andinternational conventions relating to the air transportbusiness, adverse weather, effects of services provided
by third-parties, large-scale infrastructure failures such as
outages of power and communication network systems
that supporting information systems, for example,
cyberattacks by computer viruses, etc.

Internal factors

corporate management, performs financial simulations
regularly, and in case a crisis or large-scale disaster isdeemed to have a significant and quantitative impact on
business performance, estimates the impact, and treats therisk together with the Group Risk Management Council, as
necessary.

External factors

The Group Risk Management Council is chaired by the
President and comprises Senior Vice Presidents and Audit andSupervisory Board Members. The council comprehensively
oversees risk management, crisis management and thebusiness continuity system, assesses current risks, anddiscusses and decides necessary risk treatment.

Priority risk

Medium Term Management Plan

· Group Risk Management Council

Business risks
CO2 emissions, noise, harmful substances,and other environmental issues, mishandlingof JAL Group customer data, human rightsbased harassment, etc.

Very large Large Medium Small
Severity■ Promotion system

Very large Large Medium Small
Severity

Business risks
Economic trends, fuel price and exchange rate
fluctuations, funding and financial market trends,
credit score fluctuations, changes in the competitiveenvironment, workstyles, taxes and public dues suchas landing fees, etc.

The JAL Group Value Creation Story

Risk Management and Information
Security Committee

Financial Risk Committee

1

7

Board of Directors

Promotion of Safety and Security

Group Operational Safety Promotion
Committee■ Risk Management Cycle

Foreword

engaged in air transport promote activities to deepen
understanding and implementation of risk management,in coordination with other Group companies.

■ To achieve JAL Group’s management targets,

Control Self-Assessment
For company-wide priority risks, a workshop is held with relevant risk managers to evaluate the vulnerability of
our responses. If additional measures are deemed necessary, the risks are treated immediately.

Risk Consulting
Under the Group Risk Management Council, consulting services are provided to vulnerable organizations by risk
management teams, in cooperation with Audit and Supervisory Board Members and the Auditing Department.

Management Review
The Risk Management Committee assesses the process and risk treatment of primarily priority risks of the JAL
Group, including reports from other committees. As a result of assessment, the committee gives instructions
for additional investigations and risk treatment, as necessary.
JAL REPORT 2021

110

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance■ BCP (Business Continuity Plan)■ Information Security Measures

In addition to risk management of aviation safety suchas aircraft accidents and incidents, we have established
Disaster Handling Regulations, which outline the system andprocedures for putting top priority on protecting the lives ofcustomers, employees and all affected persons, and a risk
prevention and mitigation system. We have also establisheda Business Continuity Plan (BCP) in the event our regular
operations are disrupted regardless of the cause, and a BCP
covering specific risks that disrupt central functions andprocesses in all areas, such as a pandemic or an earthquake
striking the Tokyo metropolitan area. To put the BCP topractice, we conduct drills regularly, and review and revise
the plan whenever the need arises.
A BCP for COVID-19 was initiated on January 21, 2020 andremains in effect.
In the BCP in case an earthquake occurs beneath Tokyo,
we partially transferred Integrated Operations Control (IOC)functions to Osaka to establish an alternative system. Japan
Airlines Co., Ltd. received the Business Continuity and Social
Contribution Resilience Certification from the Resilience
Japan Promotion Council on November 30, 2019, and ahigh A rating (special interest rate Ⅱ) for business continuity
management from the Development Bank of Japan on March
30, 2020.

· Basic Policy· Management System

In March 2020, we received a DBJ BCM rated
loan from the Development Bank of Japan(DBJ), and the rating results commended Japan
Airlines for “particularly advanced business
continuity initiatives.”· Promotion of Security

Aircraft accident
orincident occurs

Operational risk
eventuates

Notification by discoverer

IOC
Contacts

Person responsible for determining risk level
Determines level

Level II

Level III

Response by special
committee

Response by crisis
management teamResponse by level

Level Ⅱ Response by special committee· A committee is formed by Vice Presidents of main departments withVice President of General Affairs as Secretariat and risk response is
implemented. Vice President of General Affairs advises the person in
charge for determining the risk level to shift to Level Ⅲ orⅠdepending on
the situation.

111

JAL REPORT 2021

Flow to treat cyber incidents

Flow of BCP Activation
Risk
eventuates

Normal level

Level Ⅲ Response by Command Office· A Head Office Command Office chaired by the President (or Executive
Vice President) is set up and normal operations quickly shift to the crisis
management system.

*1 Safety Guidelines for Information Security in the Aviation Field*2 A system for promoting activities that contribute to the improvement of collective defense capabilities against cyber attacks by businesses in public transportation and transport sector

Data Book

Level I
Response by the person
responsible for handling the risk

Medium Term Management Plan

Under the leadership of the Chief Information Security Officer (CISO) appointed from among Executive Officers, the information
security organization promotes information security throughout the JAL Group. As a major public transport operator, we
1
implement data breach prevention measures and virus prevention measures in accordance with guidelines* established by the
Ministry of Land, Infrastructure, Transport and Tourism.
To be prepared for an incident, we monitor unauthorized access, virus infections and other threats 24 hours a day, 365 days ayear, in cooperation with external specialized agencies. In case an incident occurs, a Computer Security Incident Response Team(CSIRT) is set up, with the information security organization as Secretariat, and quick action and recurrence prevention measures
are implemented.
2
As prior information gathering is essential to strengthening cyber security, we participate in Transport ISAC* , the Information
Sharing And Analysis Center for transport operators, and use the information obtained to continuously enhance information
security measures. Furthermore, we continuously implement the PDCA cycle, including an annual audit by an external specialized
agency, and make necessary improvements.
To counter changing risks in recent years due to the proliferation of remote work, we have enhanced information security in the
New Normal, including the use of company provided computers installed with data breach prevention measures that can be usedsafely even outside the company.

Flow for Determining Risk Level

LevelⅠResponse by the person responsible for handling the risk
· The person in charge (leader of organization where the risk has occurred)
responds by assembling people deemed necessary.
· The person in charge advises the person responsible for determining
the level of risk to shift to Level Ⅱ or Ⅲ according to the severity of thesituation.

Given past incidents of personal data breaches caused by unauthorized access to the JAL Mileage Bankand customer data management system, we have positioned enhancement of information security
as a high priority issue. We establish and update measures for regulatory compliance and classify andmanage customer data and other data appropriately. We also educate all employees regularly throughe-Learning.
In addition, the Risk Management and Information Security Committee, which is responsible for personal data management andinformation security, takes steps to enhance information security and reduce business risk.
To respond to increasing threats of cyber-attacks, which are becoming more sophisticated and complex, we have establishedmeasures to detect, quickly respond, and quickly recover from them. Going forward, we will continue to evolve prevention
measures and take all possible steps to protect our business from cyber threats.

The JAL Group Value Creation Story

When a risk has arisen, or is likely to arise, that will affectaviation security, and the performance of air transportation
business (operational risk), this risk is promptly notified toIntegrated Operations Control (IOC) within 15 minutes of theoccurrence.
The person in charge of making LevelⅠto Ⅲ decisions forcrisis management depending on the situation decides theapplicable level and responds to the crisis according to thatlevel. Drills, reviews, education and training are conducted
regularly for each type of disaster with the objective to raiseawareness of crisis management of every employee.

Foreword■ Risk response

In light of the importance of information security and personal information protection in an advanced information
communications society, the JAL Group has established the JAL Group Basic Policy on Information Security and Personal
Information Protection. Information security measures are disclosed on the JAL website, such as compliance with laws, regulations
and internal rules, establishment of a management system, implementation of safety measures, education and awareness-raising
activities, collaboration with contractors, responses to accidents, to make staff aware of consultation services available around theinformation security issue. By implementing these policies, we are striving to properly manage and protect the information heldby the company.

Response by crisis
management system
Crisis management

Target recovery time
Business continuity
BCP

Business
continuity
targetDetect incident
throughmonitoring
systemIncident response
system
Set up CSIRT

Respond to theincident
Actions according to the
Risk Management Manual

Solve the incident
Prevent recurrence

Return to normal operations

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112

Chapter2

Medium Term Management Plan

Business Strategy

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Major External Ratings 2020 – 2021

Received Japan Tourism Award forJapan’s first JAL LGBT ALLY charter flight

Received a special award in Ikumen (men who
take an active role in childrearing) EnterpriseAward 2020 (for COVID-19 measures)

Eleven JAL Group companies selected in
Certified Health & Productivity
Management Outstanding Organizations
Recognition Program 2021

Became the first airline in Japanto win both corporate andindividual awards in 2021 J-Win
Diversity Award

Received 5-star World Airline
Star Rating from SKYTRAX(from 2018)

Became the first airline in Asia to receive
the world’s highest certification from two
external organizations

Selected as DX Brand 2021

Received CDP B rating(industry average C rating)Ranked first as an Excellent
Disclosure Company in thetransportation sector for thethird time in the past four years

Sustainability

Realize an affluent society
where each one of us
can sense and hopefor a brighter future

We have set a medium target for each of the “4 areas/22 issues” that the JAL Group is working on.
The JAL Group will aim to realize a sustainable society through daily business activities and promote
ESG management to achieve the SDGs.
Results of FY20

Contribution to SDGs

Target for FY25
Management
TargetBelow 9.09 million tons

CO2 emission Scope 2 [ground facilities]

57,000 tons

51,000 tons

54,000 tons

Ratio of fuel-efficient aircrafts

82%

84%

86%

Ratio of SAF loaded in total fuel amount

Loaded to all 5 delivered
A350 aircrafts

0%

Replace 1% of total fuels to SAF

Amount of reduction by JAL Green Operations(reducing CO2 emissions in daily operations)

157,000 tons
(1.7% of total emission)

82,000 tons
(1.8% of total emission)

Reduce 2.5% amount of CO2 emitted
from aircrafts

Reduction ratio of new petroleum derived single
plastic use items in in-house standard products
used in-flight and in lounges

2.5%

To be disclosed within
FY21

100%

Management
TargetRatio of eco-friendly material in plastic bags used
for checked baggage at airports*started from FY20

36.3%

100%

Management
TargetRatio of eco-friendly material in plastic used incargo transportation

91%

90%

100%

Management
TargetNumber of routes with meal reservation service
introduced*started from FY20

2 routes

All routes

Recycling ratio of cooking residue in preparing
in-flight meals

7.7%

28.0%

100%

Paper reduction

Paperless in cargo sheds*started from FY20

ーComplete paperless in JAL flights

Prevention ofEnvironmental Pollution

Industrial waste reduction

Final disposal rate

0.3%

0.6%

Keep below 1%

Noise Reduction

Operation with low-noise aircrafts

Ratio of ICAO Chapter 4 standard compliant
aircraft

100%

100%

100%

Prevention of illegal wildlife trade

Number of illegal wildlife transported

0 times

0 times

0 timesUse of certified products

Ratio of paper items with FSC® certified paper
used in-flight

24.2%

66.5%

100%

Reduction of CO2 emissions

Plastic use reduction

Effective Use of Limited
Resources
In-flight meals disposal reduction

Data Book

4.39 million tons

Medium Term Management Plan

Environment

Results of FY19
9.09 million tons

Biodiversity
Conservation

JAL REPORT 2021

Performance indicators
CO2 emission Scope 1 [aviation]

Address to
Climate Change

113

Main initiatives

The JAL Group Value Creation Story

22 issues

E

Foreword

Major Sustainability Initiatives and Results to Date

JAL REPORT 2021

114

Chapter2

Medium Term Management Plan

Business Strategy

22 issues

Promotion of D&I

Finance Strategy

ESG Strategy

E Environment｜S People｜S Communities｜G Governance

Main initiatives
Promotion of diverse talent participating
actively in work

Improvement of working productivity
Workstyle Innovation

PeopleHealth andProductivity
Management

Conducting of Human Rights Due Diligence

Human Resources
Development

Enhancement of employee training

Improving Accessibility

Promotion of boarding passengers who
feel barriers to travelling

Contribution to SDGs

Target for FY25

Ratio of disabled staff hiring*1

2.62%

2.67%

To be established in accordance with thestatutory employment rate

Ratio of female managers*2

18.4%

19.5%

30%

Number of people who used nursing care leave system

53 people

40 people

Track record

Total work hours

1,862 hours

1,878 hours

1,850 hours

Ratio of annual paid leave taken

79.0%

71.5%

100%

Monthly overtime/working hours on holidays per employee

9.5 hours

8.0 hours

4 hours (linked with the annual total workhour target of 1,850 hours)

Cumulative total number of people who used telework

36,352 people

640,579 people

Track record

Number of workcation/bleisure system used

247 times (workcation only)

To be disclosed within FY21

Track record

Ratio of check-ups taken by employee

100%

100%

Keep 100%

Ratio of check-ups taken by family members

37.5%

Ratio of breast cancer check-up taken

36.7%

Ratio of uterine cancer check-up taken

30.7%

Handling against issues (establishment of PDCA andappropriate operation)ーーSpecification of issues and conducting of
improvement plans

Training hours per person

72.3 hours/person

277.1 hours/person

Track record

Training cost per person¥449,480/person¥109,321/person

Track record

Ratio of such passengers onboard

0.36%

0.29%

2.5 times v.s. FY19 result

Number of wooden chairs which do not get caught inmetal detectors

478 wheelchairs

478 wheelchairs

To be disclosed within FY21

Management
Target75%
To be disclosed within FY21

70%
70%

Prevent the Spread of
Infectious Diseases

Activation of medical items
transportation

Weight of transported medical items

610 tons

721 tons(118% v.s. FY19 result)+50% v.s. FY19 result

Route Network
Expansion

Preserving and development of regionalroutes including island routes

Number of Domestic sites (including code share)

62 sites

61 sitesMore than 62 sites

Increase Inbound Tourism

Promotion of passengers from outside ofJapan boarding on domestic flights

Number of people boarded

701,240 people

To be disclosed within FY21

1,505,000 people

Improving Conveniencein Travel

Commercialization of drone
logistics/”flying cars” air taxi

Realization of commercializationーー

FY23: commercialization of drone logistics
FY25: commercialization of flying cars

Regional Revitalization

Increase of tourists to regional areas

Ratio of increaseー

25.8% v.s. FY19 result+10% v.s. FY19 result

Number of people joined

7,745 people

9,772 people

Track record

Total hours

51,734 hours

33,600 hours

Track record

Nurturing the next generation

Number of people who joined the SORAIKUⓇ*3

191,840 people

20,435 people

Track record

Disaster relief

Amount of money donated by Charity Miles¥9,208,500¥11,328,500

Track record

Compliance to the Corporate Governance CodeCompliance rate

100%

100%

Keep 100%

Function improvement of Board of
Directors

Ratio of External Directors

30%

30%

Over one third

Attendance ratio of External Directors andAuditors to Board of Directors

98.3%

100%

Keep over 80%

Prevention of information leakage

Number of incidents occurred

0 cases

2 cases

0 casesPrevention of corruption and bribery

Number of corruption and bribery

0 cases

0 cases

0 cases

Disclosure

Reinforcement of information disclosure in
Sustainability pages of the Corporate website

Number of views

765,912786,229

Over 1,000,000

Responsible
Procurement

Supply chain management

Soundness confirmation ratio of primary suppliers

18%

37%

100%

Number of regulatory safety audits of all caterer
factories and in-flight supply storerooms per year

2 times

2 times

2 times

Promotion of BCM

Improvement of BCP effectiveness

Number of exercises conducted per BCP

1 time1 time2 times

Community Relations

Management
TargetData Book

Fair Business Practices

Promotion of volunteerism

Medium Term Management Plan

GovernanceRatio improvement of gynecologicalcheck-ups

Respect for Human Rights

Disaster Restoration AssistanceG

Improvement of health check-up ratio

Results of FY20

The JAL Group Value Creation StoryS

Communities

S

Results of FY19

Foreword

Promotion of diverse workstyles

Performance indicators*1: Combined data for Japan Airlines Co., Ltd. and its special subsidiary JAL Sunlight Co., Ltd. *2: Data of the JAL Group*3: Activities in order to think about their own futures, future of Japan, the World and the Earth by experiencing the wonder of the skies

115

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116

TOPIC

Olympic and Paralympic Games Tokyo 2020

As an Official Airline Partner
As the official airline partner of the Olympic and Paralympic Games Tokyo 2020 (Tokyo 2020), JAL contributed to the realization of
the Games Vision, “Sport has the power to change the world and the future” and supported the historic event by communicating
emotions and courage to the world. As a supporting partner of the Tokyo 2020 Olympic Torch Relay, in March 2020 we transported
the Tokyo 2020 Olympic Torch from Greece in cooperation with ANA. We also provided safe and secure air transport during the
pandemic so that athletes and tournament officials from around the world could gather in Tokyo with peace of mind.

03

Data Book

JAL’s Policy of Approaches to Tokyo 2020
● Make efforts to recover demand and contribute torevival and reconstruction● Contribute to creating a society that recognizes
diversity● Enhance safety and security and deliver smooth andForeword● Contribute to the success of the Games as proof ofregional revitalization
comfortable travel

The JAL Group Value Creation Story

Major Initiatives and Employee Activities■ J AL’s third aircraft with special livery “Everyone’s JAL 2020 Jet” goes into service on domestic
flights
In 2019, we launched the first and second special aircraft for Tokyo 2020 to build momentum, and in 2021, the third special jet(A350) with gold livery on domestic routes to coincide with the opening of Tokyo 2020. Under the slogan “Gambaro Nippon!
(Go, Japan!),” the aircraft is designed with pictures of Japanese athletes supported by JAL on the fuselage and a gold Tsurumaru(Japanese crane) logo on the tail so that everyone in Japan as well as the athletes can feel hope for a brighter future. We also
conducted related measures in the cabin, at airports and on the JAL website.

Medium Term Management Plan

Data Book■ J AL athlete-employees participate in Tokyo 2020
JAL athlete-employees, Koki Kano (fencing epee), Naoto Tobe (high jump) and Haruka Kitaguchi (javelin), were selected torepresent Japan for the first time. JAL will continue to support athletes who strive to reach world’s top level.
KANO Koki: Finished 15th in the men’s fencing epee individual competition and won the gold medal in the team competition,a first for Japan.
TOBE Naoto: (High Jump Japanese record holder) Japan’s team advances to finals for the first time in 49 years (13th place)
KITAGUCHI Haruka: (Javelin Throw Japanese record holder) Japan’s team advances to the finals for the first time in 57 years(12th place)

117

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Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Data Highlights■ Business■ ESG

Aircraft accident

Serious incident■ Cases■ Cases■Large ■Medium ■Small ■Regional jets

３
２
1

1

１

0
2016

０

0

2017

2018

2019

１

2020（FY）

2016

2017

2018

2019

2020（FY）

56

55

53

64

65

65

70

71

77

52

7

3
Net profit/loss (billion yen)*
Repurchase amount (billion yen)

Dividend payout ratio (%)

35.3%

51

62

Total return ratio*

6

39.3%

61

30.0

40

40

40

44

45

2016

2017

2018

2019

2020（FY）

33.2

20.0

20.0

38.7

38.3

29.4%

32.3%

2017

2018

2019

2019

Japanese standards

2017

2018

48.0
20.0

20.0

18.8

18.8

2016

2019

2019

Japanese standards

Domestic

International

52,054

Domestic (%)

NPS (Net Promoter Score)
Total (%)

International (%)

Domestic (points)

Percentage of fuel-efficient aircraftInternational (points)

96.38

53,295 54,747 51,129

86.91

84.18

84.99

85.00

86.85 87.10 84.73 85.79 84.12 87.46
83.29 86.83

96.27

30.0

95.33

8,138

23.0

225,265 235,246 244,467 242,603

2018

2019

50

65

79

82

2020（FY）

IFRS

4,393

83.0%

2016

2017

2018

2019

2020（FY）

Ratio of female managers

Staff headcount (persons)

32,753 33,038

84

80.6%

Staff

100

72

82.2%

Ratio of female managers (%)

34,003 35,653

36,06020182020 （FY）

16.3%

16.3%

16.8%

2016

2017

2018

18.4%

19.5%

0
0

2020（FY）
2016

2017

2018

2019

2020（FY）

2017

Initial result

2.1

2.2

1.4

1.3

2017

2018

7.6

2020（FY）

2019

0

2016

2017

2018

2019

2020（FY）

2016

2017

2019

2019

Medium Term Management Plan

2017

Fuel-efficient aircraft (%)

108.2%
9,090

8.2

134,3252016

Non-fuel-efficient aircraft (%)

84.6%

9,330

The JAL Group Value Creation Story

On-time arrival rate

Number of flights

0%

9,070

▽286.62020（FY）

IFRS

8,750

39.3%

35.3%
53.4

0.0%
2016

CO2 emission per revenue ton kilometer (vs FY2005)
CO2 emissions from aircraft (1000 tons)

80.9%

49.2%

44.5%

25.1%

20.6%

80

Total return ratio (%)*7

150.8

135.4

47.7%

25.5%

83

Total dividends (billion yen)
Dividend payout ratio (%)*3

72.8%

164.1

28.7%

CO2 emission reduction

Foreword

1

Dividend payout ratio*

Number of aircraft

2020（FY）*1■ Finance
財 務

EBIT* /Net profit/loss* /EBIT margin
2

3

Operating profit (billion yen)3
Net profit/loss (billion yen)*
Operating profit margin (%)
13.2%

12.6%

174.5

EBITDA (billion yen)*

4

20.6%

5

5

300.2

16.9%
238.6

88.8

■ Shareholders’ equity (billion yen)
58.9%
56.2% 57.2% 57.4%

18.1%
251.2

972.0

1,060.3

1,165.1

1,094.8

Equity ratio (%)

Japanese standards

2019

JAL REPORT 2021

■ Monthly average overtime and work on days off per employee (hours)
Ratio of annual paid leave applicants (%)
85.5%

45.0%
1,014.2

947.4

9.6%

10.5%

11.3%

11.5%

12.2%

2019

2020 （FY）

IFRS

2017

2018

Japanese standards

2019

2019

2020（FY）

IFRS

86.0%

76.5%

71.5%

2.69%

2.69%

2.62%

2.67%

7.9

8.5

9.5

8.0

Statutory employment ratesince March 1, 2021 (2.3%)▽215.8

2016

89.5%

12.0

48.0

2016

2017

2018

2019

Japanese standards

2019

2020（FY）

2016

2017

2018

2019

2020（FY）

2016

2017

2018

2019

2020（FY）

2016

2017

2018

2019

2020（FY）

IFRS*1	International Financial Reporting Standards (IFRS) have been applied since fiscal 2020. As a result, fiscal 2019 figures show IFRS based figures and figures based on Japanese standards.
*2	EBIT (Earnings Before Interests and Taxes): Earnings before finance and corporate income taxes*3	[Japanese standards] Net profit attributable to owners of parent [IFRS] Profit attributable to owners of parent (billion yen)
*4	[Japanese standards] EBITDA = Operating profit + Depreciation [IFRS] EBITDA = EBIT + Depreciation
revenue [IFRS] EBITDA margin = EBITDA/Sales revenue*5	[Japanese standards] EBITDA margin = EBITDA/Operating
3,8*6	Dividend payout ratio = Total dividends/Net profit/loss*

119

Overtime work and annual paid
leave applicants

51.2%

2.56%
53.4

2018

Employment rate of persons
11with disabilities*
Employment rate of persons with disabilities (%)

Ratio of non-Japanese managers (%)

150.8▽398.3201710

Data Book

266.1

285.4

EBITDA margin (%)*

▽286.62016

Ratio of non-Japanese managers*

Equity ratio

20.2%

6.4%

176.1

135.4

4

20.6%

100.6
164.1

EBIT margin (%)

11.8%
7.1%

170.3

EBITDA* /EBITDA margin*

EBIT (billion yen)*2*7	Total return ratio = (Total dividends + Repurchase of treasury stock)/Profit/Loss*8	Net profit attributable to owners of parent from FY2015 through FY2018 excludes corporate tax adjustments*9	EBIT margin and EBITDA margin for FY2020 are not shown due to negative figures.
*10	In Japan Airlines Co., Ltd. (Locally hired managers overseas + Non-Japanese managers hired in Japan in business planning and maintenance engineering jobs)/Total managers*11	Aggregate of Japan Airlines Co., Ltd. and JAL Sunlight Corporation, a special subsidiary, as of June 1 of the following fiscal year

JAL REPORT 2021

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Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Business Data
Traffic Data

SafetyUnit

FY2016FY2017FY2018FY2019FY2020Aircraft accident

cases

1

0

1

1

0

Serious incident

cases

0

1

2

3

1

FY2016FY2017FY2018FY2019FY2020

0

0

0

5

8

aircraft

13

13

13

13

13

Boeing 777-300

aircraft

4

4

4

4

4

Boeing 777-200ER

aircraft

11

11

11

11

11

Boeing 777-200

aircraft

12

12

12

11

Boeing 787-9

aircraft

8

11

17

Boeing 787-8

aircraft25

25

Boeing 767-300ER

aircraft31

Boeing 767-300

aircraft6

Boeing 737-800

aircraftBoeing 737-400

aircraftBombardier CRJ200

aircraft

5

0

0

0

0

Embraer 170/Embraer 190

aircraft

22

29

32

32

32

Bombardier DHC-8-400CC

aircraft

4

5

5

5

5

SAAB340B

aircraft

12

10

8

5

3

Bombardier DHC-8-400

aircraft

9

6

1

0

0

Bombardier DHC-8-300

aircraft

1

1

0

0

0

Bombardier DHC-8-100

aircraft

2

0

0

0

0

ATR42-600/ATR72-600

aircraft

1

4

7

10

11

FY2018FY2019FY2020people32,570,397

34,033,475

34,859,576

33,783,710

12,212,131

Revenue Passenger Kilometers*

35,423,513

35,714,021

36,116,930

36,199,539

19,452,985

Available Seat Kilometers*

1000 seatskilometers

24,550,154

25,643,092

26,195,658

25,443,520

9,282,122

Passenger Load Factor

%

69.3

71.8

72.5

70.3

47.7

International flights (Full Service Carrier (FSC))
Total passengers*

people8,394,777

8,585,399

9,128,236

8,277,987

357,519

Revenue Passenger Kilometers*

1000 peoplekilometers

50,621,656

51,836,491

54,925,904

54,324,546

11,918,047

9Available Seat Kilometers*

1000 seatskilometers

40,633,050

42,013,111

44,659,463

41,905,628

2,196,423

20

20

%

80.3

81.0

81.3

77.1

18.4

25

29

29

3
Passenger Load Factor*

29

29

29

29

6

6

5

2

53

57

62

62

61

11

8

3

0

0

3
1, 3

2, 3

Cargo and Mail
Domestic revenue cargo ton-km

1000 tonskilometers

357,803

364,089

343,529

328,182

237,874

International revenue cargo ton-km

1000 tonskilometers

1,887,856

2,233,387

2,429,268

2,407,691

1,948,205

Unit

FY2016FY2017FY2018FY2019FY2020

The JAL Group Value Creation Story

aircraftBoeing 777-300ER

FY2017

Foreword

Airbus A350-900

FY20161000 peoplekilometers

Total passengers

2

Unit

Unit

Domestic flights
1

Aircraft

IFRS*5

Japanese GAAP

Customers
NPS (Net Promoter Score)*4
Domestic flights

points

—

+1.4

+1.3

+7.6

+23.0

International flights

points

—

+2.1

+2.2

+8.2

+30.0
Medium Term Management Plan

*1	Revenue Passenger Kilometers: The total distance flown by revenue paying passengers. Number of Revenue Passengers x Distance Flown (kilometers)*2	Available Seat Kilometers: Measures passenger carrying capacity. Total seats x Distance flown (kilometers).
*3	Since fiscal 2015, calculation of figures for Revenue Passengers Carried, Revenue Passenger Kilometers, Available Seat Kilometers, and Passenger Load Factor for international flights

Flight Data

include codesharing of JAL-operated flights sold by other airlines.

Unit

FY2016FY2017FY2018FY2019*4	Compared to results in early fiscal 2017*5	International Financial Reporting Standards (IFRS) have been applied since fiscal 2020.

FY2020

Number of cities served
Domestic flights

destinations

59

59

60

62

61

International flights

destinations

251

284

348

378

368

Total

destinations

310

343

408

440

429
134,325

Number of flights
Domestic flights

flights

225,265

235,246

244,467

242,603

International flights

flights

52,05453,29554,747

51,129

8,138

Total

flights

277,319

288,541

299,214

293,732

142,463

Domestic flights

%

90.86

84.72

88.33

86.71

96.74

International flights

%

89.28

87.80

87.47

86.35

93.17

Total

%

90.46

88.61

88.10

86.62

96.02

Data Book

On-time departure rate

On-time arrival rate

121

Domestic flights

%

86.85

84.73

84.12

83.29

96.27

International flights

%

87.10

85.79

87.46

86.83

95.33

Total

%

86.91

85.00

84.99

84.18

96.38

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122

Chapter3

Data Book

Data Highlights

Business Data

International Route Map

Financial Data

ESG Data(as of August 23, 2021)

Foreword
The JAL Group Value Creation Story
Medium Term Management Plan

Data Book● The above route map includes codeshare flights.
● The above map is not geographically correct. This is for the purpose ofplacing JAL’s online cities in the center.
● Dashed lines (----) indicate a one-way route.

123

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Chapter3

Data Book

Data Highlights

Business Data

Domestic Route Map

Financial Data

ESG Data

Consolidated Subsidiaries(as of August 23, 2021)

Corporate Name

Paid-in Capital Ratio of Voting Rights(Millions of yen) Direct (%) Indirect (%) Total (%)

Air Transport Business Segment

Asahikawa(Center of Hokkaido)

Memanbetsu (Abashiri・Bihoro・Kitami)
Kushiro(Tancho Kushiro)

MaintenanceObihiro(Tokachi Obihiro)

Sapporo(New Chitose)

Hakodate

Okushiri

Aomori
Misawa(Hachinohe・Towada)
Akita

Yamagata(Oishii Yamagata)
Sendai
Niigata

Komatsu (Kanazawa・Fukui)

Oki(Oki Island Global Geopark)

Izumo(Izumo Enmusubi)

Tajima(Kounotori Tajima)

Okayama(Okayama Momotaro)

Osaka(Itami)

Nagoya(Komaki)Nagoya(Chubu)Tokyo(Haneda)Tokyo(Narita)

Shizuoka(Mt.Fuji Shizuoka)

Osaka(Kansai)

Tokushima
Yamaguchi Ube Takamatsu(Tokushima Awaodori)
Kitakyushu
Kochi(Kokura)Matsuyama(Kochi Ryoma)
Oita
Nanki Shirahama

Fukuoka

Kumamoto(Aso Kumamoto)Nagasaki
AmakusaMiyazaki(Miyazaki Bougainvillea)

Kagoshima

72.8

—

72.8

JAPAN AIR COMMUTER CO., LTD.

300

60.0

—

60.0

200

100.0

—

100.0

9,000

100.0

—

100.0

HOKKAIDO AIR SYSTEM CO., LTD.

490

57.3

—

57.3

RYUKYU AIR COMMUTER CO., LTD.

396

—

74.5

74.5

ZIPAIR TOKYO CO., LTD.

Airport Passenger Handling

Tanegashima(Cosmoport Tanegashima)

Okinoerabu(Erabuyurinoshima)
Yoron

Kita-Daito

Kumejima
Okinawa(Naha)TaramaYonaguni

MiyakoIshigaki(Painushima Ishigaki)

Minami-Daito* Services are not available on select routes during certain periods of the year.

• O saka (Kobe)-Aomori, Osaka (Kobe)-Hanamaki, Osaka (Kobe)-Matsumoto, Osaka (Kobe)-Kochi,
Sapporo (New Chitose)-Yamagata, Sapporo (New Chitose)-Matsumoto, Sapporo (Okadama)-Matsumoto,
Sapporo (Okadama)-Shizuoka, Yamagata-Nagoya (Komaki), Sendai-Izumo, Niigata-Fukuoka,
Shizuoka-Izumo, Shizuoka-Fukuoka, Shizuoka-Kagoshima, Nagoya (Komaki)-Izumo, Nagoya (Komaki)-Kochi,
Nagoya (Komaki)-Fukuoka, Nagoya (Komaki)-Kumamoto sectors are codeshare flights with Fuji Dream
Airlines (FDA). They are operated by FDA aircraft and crew.

1,960

46.4

4.6

51.0

96.7

1.1

97.8

16.7

83.3

100.0

JALPAK INTERNATIONALHAWAII, INC.

USD 1,000

—

100.0

100.0

JALPAK INTERNATIONAL(EUROPE) B.V.

EUR 1,000

—

100.0

100.0

JALPAK INTERNATIONAL(FRANCE) S.A.S.

EUR 1,000

—

100.0

100.0

—

100.0

100.0

—

100.0

100.0

—

100.0

100.0

—

49.0

49.0

100

51.0

—

51.0

JAL INFORMATION TECHNOLOGYCO., LTD.

702

100.0

—

100.0

JAL DIGITAL EXPERIENCE CO., LTD.

475

51.0

—

51.0

33

66.7

33.3

100.0

JALSKY OSAKA CO., LTD.

30

100.0

—

100.0

JALSKY KYUSHU CO., LTD.

30

100.0

—

100.0

JALSKY SAPPORO CO., LTD.

30

100.0

—

100.0

JALSKY KANAZAWA CO., LTD.

10

100.0

—

100.0

JALSKY SENDAI CO., LTD.

10

100.0

—

100.0

JALPAK INTERNATIONAL ASIA
PTE. LTD.

JAL GROUND SERVICE CO., LTD.

100

99.8

0.2

100.0

JAL SATELLITE TRAVEL CO., LTD.

JAL GROUND SERVICE OSAKA CO., LTD.

10

—

100.0

100.0

JAL GROUND SERVICE KYUSHU CO., LTD.

10

—

100.0

100.0

JAL GROUND SERVICE SAPPORO CO., LTD.

10

—

97.7

97.7

JAL ENGINEERING CO., LTD.

80

100.0

—

100.0

JAL MAINTENANCE SERVICE CO., LTD.

10

100.0

—

100.0

EURO-CREATIVE TOURS (U.K.) LTD.

PT. TAURINA TRAVEL DJAYA*2

1,000
1,600
160
GBP 1,000

100
SGD 1,000

146
HKD 1,000

750
IDR 1,000

500,000

Airport-Related Business
JAL ABC, INC.

OthersJAL KANSAI AIRCARGOSYSTEM CO., LTD.

100

69.2

—

69.2

JAL PAYMENT PORT CO., LTD.

390

16.5

68.5

84.9

JAL CARGO SERVICE CO., LTD.

50

100.0

—

100.0

JAL CARD, INC.

360

50.6

—

50.6

JAL CARGO HANDLING CO., LTD.

50

—

100.0

100.0

JAL FACILITIES CO., LTD.

180

85.0

—

85.0

JAL CARGO SERVICE KYUSHU CO., LTD.

20

40.0

40.0

80.0

JAL BUSINESS AVIATION CO., LTD.

100

100.0

—

100.0

JAL SALES CO., LTD.

460

100.0

—

100.0

AXESS INTERNATIONAL
NETWORK, INC.

100

49.0

—

49.0

JAL NAVIA CO., LTD.

50

100.0

—

100.0

JAL AGRIPORT CO., LTD.*2

100

51.0

—

51.0

JAL MILEAGE BANK CO., LTD.

40

100.0

—

100.0

JAL HONGYUAN CO., LTD.

100

51.0

—

51.0

JAL BRAND COMMUNICATIONS
CO., LTD.

100

100.0

—

100.0

JTA INFORMATION &COMMUNICATION CO., LTD.

50

—

100.0

100.0

JAL SBI FINTECH CO., LTD.

45

51.0

—

51.0

JAL SUNLIGHT CO., LTD.

20

100.0

—

100.0

OFFICIAL FILING CO., LTD.

10

50.0

4.0

54.0

JPRO CO., LTD.

10

—

100.0

100.0

100.0

—

100.0

2,700

51.0

—

51.0

JLC INSURANCE COMPANY
LIMITEDUSD 1,000

2,000

Data Book

Tokunoshima(Tokunoshima Kodakara)

HKD1,000

30

100.0

JAL ROYAL CATERING CO., LTD.
Kikaijima

70.0

80

—

Cargo

3.4

JAL JTA SALES CO., LTD.
100.0

Maintenance

66.6

JALPAK CO., LTD.*1

100

Ground Handling

100

Passenger Sales

JAL SKY AIRPORT OKINAWACOMPANY., LTD.

Airport-Related BusinessAmami-Oshima

JUPITER GLOBAL, LTD.

JAL SKY CO., LTD.

Passenger Sales

Yakushima

JAL AIRTECH CO., LTD.

Cargo

Medium Term Management Plan

Hiroshima

Osaka(Kobe)

Matsumoto(Shinshu Matsumoto)

4,537

The JAL Group Value Creation Story

Hanamaki(Iwate Hanamaki)

JAPAN TRANSOCEAN AIR CO., LTD.
J-AIR CO., LTD.

Paid-in Capital Ratio of Voting Rights(Millions of yen) Direct (%) Indirect (%) Total (%)

Foreword

Sapporo(Okadama)

Corporate Name

Other Segments

Air Transport BusinessRishiri(as of March 31, 2021)*1 S ales revenue (excluding operating revenue between consolidated subsidiaries)
of JALPAK Co., Ltd. accounts for over 10% of consolidated operating revenue.
*2 Although JAL’s ownership is 50% or less, it is considered a subsidiary because
JAL has substantial control.

• Fukuoka-Amakusa, Kumamoto-Amakusa sectors are codeshare flights with Amakusa Airlines (AMX). They
are operated by AMZ aircraft and crew.

* Some flights between Osaka (Itami) and Kumamoto are also codeshare flights with AMX.

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Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Financial Data
(Billions of yen)Japanese GAAPFY2012FY2013

FY2014FY2015FY2016FY2017FY20181IFRS*

FY20191,309.3
1,142.5
166.7
157.6
166.2
247.9
(166.7)(61.9)
81.2
82.7
249.5
281.0
164.5

1,344.7
1,165.0
179.6
175.2
149.0
261.1
(199.2)(67.3)
61.8
85.8
265.5
292.7
198.6

1,336.6
1,127.4
209.1
209.2
174.4
312.3
(207.2)(49.6)
105.1
88.5
297.7
321.1
210.6

1,288.9
1,118.6
170.3
165.0
164.1
253.1
(215.5)(53.5)
37.5
95.7
266.1
286.2
233.1

1,383.2
1,208.6
174.5
163.1
135.4
281.5
(180.1)(55.8)
101.3
110.8
285.4
305.4
208.0

1,487.2
1,311.1
176.1
165.3
150.8
296.7
(186.3)(37.0)
110.3
124.1
300.2
320.1
222.1

1,411.2
1,310.5
100.6
102.5
53.4
60.0
(221.5)(30.1)(161.5)
138.0
238.6
260.2
239.6

As of fiscal year-end
Total assets
Net assets
Interest-bearing debt
Shareholdersʼ equity

1,216.6
583.1
160.1
565.0

1,340.1
711.0
134.2
690.2

1,473.3
800.7
100.5
776.4

1,578.9
870.5
92.6
843.0

1,728.7
1,003.3
116.0
972.0

1,853.9
1,094.1
125.7
1,060.3

2,030.3
1,200.1
142.3
1,165.1

1,859.3
1,131.8
191.7
1,094.8

473.36
1,558.15
95.00
362,671458.45
1,903.53
80.00
362,639411.06
2,142.00
104.00362,584481.292,325.79
120.00362,500

456.56
2,749.71
94.00
359,594383.233,019.52
110.00353,334

432.103,340.15
110.00349,006

155.66
3,249.27
55.00
343,101

15.8
36.0
16.9

12.7
26.5
13.0

13.4
20.3
12.8

15.7
21.5
13.7

13.2
18.1
10.3

12.6
13.3
9.7

11.8
13.6
9.1

7.1
4.7
5.2

Per share data (yen, U.S. dollars)*
Profit attributable to owners of parent
Net assets
Dividends
Average number of shares during the fiscal year (thousands of shares)
6

Key Performance Indices
Operating margin (%)
ROE (%)ROA (%)

127

JAL REPORT 2021

51.5
0.2x
19.1
21.5
8.6
12.2
17.5
31,020

52.7
0.1x
19.8
21.8
8.7
12.3
25.3
30,978

53.4
0.1x
22.3
24.0
9.1
11.7
24.9
31,331

56.2
0.1x
20.6
22.2
9.4
11.7
20.6
32,047

57.2
0.1x
20.6
22.1
10.1
12.5
28.7
33,038

57.4
0.1x
20.2
21.5
10.4
13.1
25.5
34,003

58.9
0.2x
16.9
18.4
10.6
13.2
35.3
35,653406.6
44,74534,036
7,525
76.1
11.9
9.1

437.5
46,23535,390
7,723
76.5
12.4
9.5

454.8
47,696
36,109
7,793
75.7
12.6
9.5

448.7
50,56340,305
8,460
79.7
11.1
8.9

415.2
50,621
40,633
8,394
80.3
10.2
8.2

462.9
51,83642,013
8,585
81.0
11.0
8.9

530.6
54,92544,659
9,128
81.3
11.9
9.7

476.2
54,324
41,905
8,277
77.1
11.4
8.8

485.2
36,44323,01230,020
63.1
21.1
13.3

487.4
37,08423,74531,218
64.0
20.5
13.1

487.5
36,30623,99331,644
66.1
20.3
13.4

501.2
35,86924,341
32,114
67.9
20.6
14.0

498.6
35,42324,55032,570
69.3
20.3
14.1

518.2
35,71425,64334,033
71.8
20.2
14.5

528.0
36,11626,19534,859
72.5
20.2
14.6

514.6
36,19925,44333,783
70.3
20.2
14.2

50.4
1,378

54.2
1,512

60.3
1,754

54.2
1,724

43.3
1,887

56.0
2,233

65.4
2,429

59.7
2,407

25.0
360

25.4
366

24.2
356

23.3
363

22.2
357

22.4
364

21.8
343

20.7
328

1,385.9
1,308.8
88.8
88.1
48.0
80.8
(233.7)(38.8)(152.8)
162.4
251.2

481.2
885.0
(398.3)(404.0)(286.6)(219.5)(91.0)
388.6(310.5)182.4(215.8)4,346,716
7,994,192(3,597,741)(3,649,878)(2,589,585)(1,982,829)(822,075)
3,510,288(2,804,904)
1,648,350(1,949,391)

Capital investment (Purchase of non-current assets)

239.6

89.6

810,098

As of fiscal year-end
Total assets
Total equity
Interest-bearing debt
Shareholdersʼ equity

1,982.2
1,049.6
277.4
1,014.2

2,107.2
981.5
515.1
947.4

19,034,224
8,865,820
4,653,111
8,558,025

Per share data (yen, U.S. dollars)Profit attributable to owners of parent
Shareholderʼs equity
Dividends
Average number of shares during the fiscal year (thousands of shares)

140.04
3,009.71
55.00
343,167(764.99)
2,168.06
0.00
374,766(6.90)
19.58
0.00

6.4
4.6
4.3
4.7
51.2
0.3x
18.1

−

−

−

−

−

−

−

−

45.0
0.5x

−

−

−

39.3
35,6530.0
36,060−486.2
53,91045,551
8,958
84.5
10.7
9.0

27.9
11,918
2,196
357
18.4
12.7
2.3

252,633

529.7
36,19927,49636,411
76.0
19.3
14.6

174.0
19,452
9,282
12,212
47.7
18.7
8.9

1,571,727

59.7
2,407

96.5
1,948

872,133

20.7
328

21.7
237

196,332

Key Performance Indices
EBIT margin (%)
ROE (%)ROA (%)ROIC (%)
Equity ratio (%)
D/E ratio (Times)
7
EBITDA margin (%)*

Dividend payout ratio (%)
Number of employees
Business Data
13
International passenger operations (Full Service Carrier)*
Passenger revenue
10,12
ASK (million seat kms)*
11,12
RPK (million passenger kms)*
12
Revenue passengers carried (1,000)*
12
Revenue passenger load factor (%)*
12
Yield (yen)*
12
Unit revenue (yen)*Domestic passenger operations
Passenger revenue
10
ASK (million seat kms)*
11
RPK (million passenger kms)*
Revenue passengers carried (1,000)
Revenue passenger load factor (%)
Yield (yen)Unit revenue (yen)International cargo operations
Cargo revenue
Revenue cargo ton-km (million ton kms)
Domestic cargo operations
Cargo revenue
Revenue cargo ton-km (million ton kms)

−

−

−

−
−
−
−
−
−

−
−
−
−
−
−

−

−

*1

IFRS is adopted from FY2020.
Accordingly, figures for FY2019
are also calculated under IFRS forcomparison.
*2 US dollar amounts are provided
for convenience only, based on
the exchange rate of ¥110.71/
USD on March 31, 2021.
*3 Free cash flow = Cash flow fromoperating activities + Cash flowfrom investing activities*4 [Japanese GAAP] EBITDA =Operating income + Depreciation
and Amortization [IFRS] EBITDA =EBIT + Depreciation*5 [Japanese GAAP] EBITDAR =Operating income + Depreciation
expense + Aircraft lease*6 Japan Airlines Co., Ltd. conducted
a 2-for-1 stock split on October 1,
2014. Figures for profit per share,
net assets per share and dividend
per share have been calculated
assuming the stock split was
conducted at the start of fiscal
2012.
*7 [Japanese GAAP] EBITDA Margin =EBITDA/ Operating Revenue [IFRS]EBITDA Margin = EBITDA/ Revenue*8 [Japanese GAAP] EBITDAR Margin =EBITDAR/ Operating Revenue*9 Unit cost = Consolidated airtransport cost (excluding fuelcosts) / ASK*10 ASK (available seat kilometers).
A unit of passenger transportcapacity: Total number of seats x
Distance flown (kms)*11 RPK (revenue passenger
kilometers). Total flight distancecovered by revenue passengers:
Number of revenue passengers x
Distance flown (kms).
*12 From FY2015, revenue passengers
carried, revenue passenger
kilometers, available seatkilometers and load factor include
codeshare tickets sold by othercompanies for JALoperated flights.
*13 From FY2020, Changes incodeshare passengers on otherairlines are reflected and to theprevious year’s figures as well forcomparison analysis

JAL REPORT 2021

Data Book

Business Data
International passenger operations
Passenger revenue
10,12
ASK (million seat kms)*
11,12
RPK (million passenger kms)*
12
Revenue passengers carried (1,000)*
12
Revenue passenger load factor (%)*
12
Yield (yen)*
12
Unit revenue (yen)*Domestic passenger operations
Passenger revenue
10
ASK (million seat kms)*
11
RPK (million passenger kms)*
Revenue passengers carried (1,000)
Revenue passenger load factor (%)
Yield (yen)Unit revenue (yen)International cargo operations
Cargo revenue
Revenue cargo ton-km (million ton kms)
Domestic cargo operations
Cargo revenue
Revenue cargo ton-km (million ton kms)

46.4
0.3x
22.3
24.8
8.4
11.5
20.1
30,636FY2020Years ended March 31
Revenue
Operating expenses
EBIT (Profit or loss before financing and income tax)
Profit before tax
Profit attributable to owners of parent
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
3
Free cash flow*
Depreciation and amortization
4
EBITDA*

1USD = 110.71 yen

Medium Term Management Plan

Equity ratio (%)
D/E ratio (Times)
7
EBITDA margin (%)*
8
EBITDAR margin (%)*
9
Unit cost (yen)*
Unit cost (yen) (Including fuel cost)
Dividend payout ratio (%)
Number of employees

FY20202

The JAL Group Value Creation Story

1,238.8
1,043.5
195.2
185.8
171.6
264.8
(129.0)(60.6)
135.8
81.0
276.2
307.1
121.8

FY2019Thousands of U.S. dollars*

Foreword

Years ended March 31
Operating revenue
Operating expenses
Operating income
Ordinary income
Profit attributable to owners of parent
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
3
Free cash flow*
Depreciation and amortization
4
EBITDA*
5
EBITDAR*
Capital investment (Purchase of non-current assets)(Billions of yen)128

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Evaluation and Analysis of Financial Conditions
Economic Conditions

Analysis of Consolidated Operating Results

Number of Visitors to Japan(Millions of visitors)
35

1. Earnings Summary

30
25

Revenue

¥

481.2

EBIT

billion▼¥

398.3

Loss attributable to owners of parent

billion▼¥286.6

billion

20
15
10
5(Year)

2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020

0

Source: Japan National Tourism Organization

Global Passenger Traffic (scheduled flights)(Millions of passengers)
5,000

Personnel costs decreased by 36.5 billion yen due to
executives’ salaries and employees’ bonus cut. To counterthe sharp drop in revenue, we have been making continuous
efforts to minimize our operating cost, together with fixed
cost restructuring and investment restructuring. As a result,operating expense was 885 billion yen (down 32.4% from theprevious year).
EBIT was loss of 398.3 billion yen (EBIT 88.8 billion yen in theprevious year). Loss attributable to owners of parent was 286.6
billion yen (profit attributable to owners of parent 48 billion
yen in the previous year) as a result of income tax expensedecrease by recording deferred tax asset.

The JAL Group Value Creation Story

3,750

In fiscal year 2020, international passenger revenue decreasedby 458.2 billion yen year over year due to the prolonged impact
of COVID-19 and domestic passenger revenue decreased by
355.7 billion yen year over year due to due to the declarationof a state of emergency responding to the spread of COVID19, resulting in a revenue decline of 481.2 billion yen (down
65.3% from the previous year).
As for expense, jet fuel costs decreased by 146.6 billion yen
attributable to fuel load reductions due to flight reductions
and a decline in jet fuel prices from the sharp drop in market
jet fuel prices. Maintenance costs decreased 15.8 billion yen
due to reduction in engine maintenance work stemming fromsignificant flight reductions.

Foreword

This fiscal 2020 was an extremely tough year for an airline
industry including the JAL Group due to the spread of
COVID-19. As the COVID-19 spread continued, the JAL
Group strived to maintain its domestic and internationalroute network while implementing hygiene and contactlessmeasures to ensure safety and security. Facing with a rapid andsignificant decrease of revenue, we implemented fundamental
cost reduction measures and investment reduction to mitigate
the negative impact of the decreased revenue. Also, we
made all possible efforts in this unprecedented crisis including
governmental supports to differ tax or fee payments as well as
subsidies for employment adjustment.
We will work altogether to endure this hardship and will fulfill
its mission as public transportation provider to enable ourvalued passengers to use our service with comfort. We will
prepare for a coming demand recovery in a future throughthose measures.

2,500
1,250

2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019

0

Fiscal year 2020 Changes in EBIT
(Year)

Source: International Civil Aviation Organization

Air Passenger Traffic Forecast

Int’lPassenger▼458.2

North America
3.0%Europe774 1,473

Domestic
Passenger

775

Latin America
2.7%

World
3.6%

Source: Japan Aircraft Development Corporation

JAL REPORT 2021

+37.1

Other
Revenue*3▼127.9referred as “EBIT”) was loss of 398.3 billion yen (EBIT 88.8 billion
yen in the previous year). The loss attributable to owners of theparent was 286.6 billion yen (the profit attributable to owners of
the parent 48 billion yen in the previous year).

Fuel+146.6

MaintenanceAircraft

+15.8

▼17.3

+21.4％▼ 13.0％▼ 46.0％▼6.2▼ 53.2％

FY2020

Personnel+36.5+42.8％+12.5％

FSC▼ 40.2

FSC

▼ 3.7

FSC

−

FX
(TTL)

▼ 0.3

FX
(TTL)

▼ 1.1

FX
(TTL)

▼0

▼ 4.9

▼0

+46.3
+13.2
+33.4
Expenses of travel agency+55.8
Other than those above+93.3
Total +242.2

Landing and navigations fees
Sales commissions
Services＋60.2％

FSC*5・FX▼ 40.5

Others+40.6％

Revenue ▼ 904.6Bn (▼ 65.3%)

JAL Group
In fiscal year 2020, the revenue for the consolidated fiscal
year decreased 65.3% year over year to 481.2 billion yen, theoperating expenses decreased 32.4% year over year to 885 billion
yen, the loss/earning before financing and income tax (hereinafter▼ 67.2％8,486 17,847

Cargo &
Mail

*4

Data Book

2.7%▼355.7442+242.2

Includingaircraft early
retirementcosts▼ 94.2％Asia-Pacific4.5%

Middle East
3.1%

▼ 398.3
Other
Expenses

2,903 7,269

3.5%

129

Medium Term Management Plan

FY20191,975 4,040

Africa＋ stands for profit increase (revenue increase, cost decrease)▼ stands for profit decrease (revenue decrease, cost increase)

ASK y/y : ▼ 64.8%
RPK y/y : ▼ 84.3%

88.8

1,923 3,560

312

*2

▼ 487.1Bn

Compound Annual Growth Rate 2020-2040
RPK in Billions■ 2019■ 2040180(JPY Bn)FSC TTLFX TTL(TTL)▼ 43.9▼ 1.6▼ 45.5

Expenses +423.8Bn (+32.4%)*1 IFRS is adopted from FY2020 and to the figures in the previous year to enable comparison analysis*2 Changes in codeshare passengers on other airlines are reflected from FY2020 and to the previous year’s figures as well for comparison analysis*3 Other Revenue = Travel Agency, Mileage, Ground Handling Handling, etc.
*4 Others = Gain or Loss on Sales of Aircraft, Other Revenue, Share of Profit or Loss of Investment and Income/Expenses from Investment*5 FSC = Fuel Surcharge

JAL REPORT 2021

130

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

2) Domestic Passenger Operations

Revenue

2. Segment Earnings¥(1) Air Transportation Segment

431.8

Components of Revenues from the Air Transportation Segment
FY2019(Millions of yen)International operations
486,217

27,917▼94.3

Cargo operations

59,74496,553+61.6

Mail-service operations

7,562

7,344

▼2.9

842

333

▼60.4

554,366

132,149▼76.2

Passenger operations

529,707174,006▼67.2

Cargo operations

20,724

21,735+4.9

Mail-service operations

3,627

3,192

▼12.0

Luggage operations
Sub total

529.7

174.0

▼67.2%

Passengers (ʼ000)*1

36,411

12,212▼66.5%ASK (MN seat km)

36,19919,452▼46.3%

1
RPK (MN passenger km)*

27,496

9,282▼66.2%L/F (%)*

76.0％

47.7％

▼28.2pt

14,54814,249

▼2.1%

19.3

18.7

▼2.7%

14.6

8.9

▼38.9%

1

Revenue per passenger (JPY)* *1 2

Passenger operations

Domestic operations

320

219

▼31.5

Sub total
Total revenues from internationaland domestic operations
Other revenues

554,380

199,154▼64.1

1,108,746

331,304▼70.1

153,136

100,517▼34.4

Total revenues

1,261,883

431,821▼65.8

Luggage operations

y/yPassenger Revenue (JPY Bn)*

1

YoY (%)FY2020

FY2020FY2019billion

1 3
Yield (JPY)* *Unit Revenue (JPY)* *1 4

ASK (MN seat km)
*2

486.2

27.9

▼94.3%

8,958

357▼96.0%

53,91011,918▼77.9%RPK (MN passenger km)

45,5512,196▼95.2%L/F (%)*

84.5％

18.4％

▼66.1pt

54,27478,085+43.9％

10.7

12.7+19.1％

9.0

2.3▼74.0％

2

Revenue per Passenger (JPY)* *2 3

Yield (JPY)* *2 4

Unit Revenue (JPY)* *2 5▼93.1%▼93.4%▼94.2%▼92.3%▼99.2%▼94.3%

America
EuropeAsia / Oceania
China
Hawaii / Guam
Total

● Revenue Passengers Carried* * 
1 2(‘000)FY2019■ RPK (million passenger kilometers) (left hand scale)*2■ ASK (million seat kilometers) (left hand scale)

1,511

102

▼93.2%

Europe750

45▼94.0%

Asia / Oceania

4,211

167

▼96.0%

China

1,365

36

▼97.3%

Hawaii / Guam

1,119

5

▼99.5%

Total

8,958

357

▼96.0%*2● ASK (MN seat km)

60,00090.0

FY201930.0
10,000● RPK* * 

70.0

40,00060.0

30,00020,00030.0
11,918
18.4
2,196
2016

2017

2018

Japanese GAAP

2019

2019

2020 （FY）

20.0
10.0
0

IFRS

16,556
7,976
18,6993,315
7,361
53,910

FY2020

y/y

5,733
2,627
3,307
142
106
11,9181 2▼65.4%▼67.1%▼82.3%▼95.7%▼98.5%▼77.9%(MN passenger km)
FY201914,227
6,759
15,641
2,552
6,370
45,551

America
EuropeAsia / Oceania
China
Hawaii / Guam
Total

FY2020

970
410
710
68
36
2,196

y/y

▼93.2%▼93.9%▼95.5%▼97.3%▼99.4%▼95.2%● Load Factor* * 
1 2*1 Figures for LCC are excluded. Changes in codeshare passengers on other
*2
*3
*4
*5

131

airlines are reflected from FY2020 and to the previous year’s figures as wellfor comparison analysis
Passengers with mileage award tickets are included from FY2020 due
to revenue recognition change by applying IFRS and also included in theprevious year’s figures for comparison analysis
Revenue per Passenger = Passenger Revenue / Passengers
Yield = Passenger Revenue / RPK
Unit Revenue = Passenger Revenue / ASK

10.0
0

JAL REPORT 2021

America
EuropeAsia / Oceania
China
Hawaii / Guam
Total

85.9
84.7
83.6
77.0
86.5
84.5

2016

2017

2018

2019

FY2020

16.9
15.6
21.5
48.2
33.9
18.4

y/y

▼69.0pt▼69.1pt▼62.2pt▼28.8pt▼52.6pt▼66.1pt

02020 （FY）

2019

IFRS

JAL Card Co., Ltd.
FY2020Overseas travelers handled(10,000 number of travelers)
Domestic travelers handled(10,000 number of travelers)
Revenue (before eliminationof consolidated transactions,billions of yen)

YoY (%)

18.3

0.0▼100.0

260.6

114.1

▼56.2

170.1

55.5

▼67.3

Memberships (10,000
number of members)
Revenue (before eliminationof consolidated transactions,billions of yen)

FY2019FY2020

372.0

358.0

▼3.8

19.6

18.6

▼4.9

Major Operating Expense Items*

1(JPY Bn)

FY2019FY2020Diff.

y/y1,385.9481.2▼904.6▼65.3%

Fuel
Landing andnavigation fees
Maintenance
Sales commissions(Air Transport)
2
Services*

243.4

96.7

▼146.6▼60.2%

84.8

38.4

▼46.3

▼54.6%

74.0

58.1

▼15.8

▼21.4% costs

17.0

3.7

▼13.2

▼77.8%

44.4

11.0

▼33.4

▼75.2%

Other linked cost*
Total revenue- andcapacity-linked cost
Aircraft

204.1

91.5

▼112.5▼55.1%

667.9

299.8

▼368.0▼55.1%

134.1

151.5

+17.3

+13.0% retirement costs

Personnel

291.3

254.8

▼36.5

▼12.5% revenue-and capacity-linked costs

Other fixed cost

215.5

178.8

▼36.6

▼17.0% revenue-and capacity-linked costs

Total fixed cost

640.9

585.1

▼55.7

▼8.7%

Total Operating Expenses

1,308.8885.0▼423.8▼32.4%

Revenue

3

Some portions are fixed

Including aircraft earlySome portions areSome portions are

YoY (%)

Operating Expenses

3. Analysis of Factors Affecting Operating Expenses

¥

885.0

billionAs for expense, jet fuel costs decreased 146.6 billion
yen attributable to fuel load reductions due to flight
reductions and a decline in jet fuel prices from the
sharp drop in market jet fuel prices. Maintenancecosts decreased 15.8 billion yen due to reduction inengine maintenance work stemming from significant
flight reductions.
Personnel costs decreased 36.5 billion yen due to
director remuneration and performance-linked
remuneration reductions. To counter the sharp
drop in revenue, we strived to reduce variable costs
such as flight operation costs through agile capacity
adjustments, huge cost reductions and curtailed
investments. As a result, operating expense came to885 billion yen (down 32.4% from the previous year).

*1 IFRS is adopted from FY2020 and to the figures in the previous year to enable comparison analysis*2 Services = Expenses regarding inflight services, airport lounges, cargo equipment, etc.
*3 Other linked cost = Travel agency, Mileage, Ground handling or etc.

(%)
FY201920.0

Data Book

40.0

80.0

50,000050.0America
EuropeAsia / Oceania
China
Hawaii / Guam
Total

40.0

9,282

y/y

America

Revenue Passenger-Load factor (%) (right hand scale)*2

10,000

FY202050.0

19,45220,000Medium Term Management Plan

International Passengers

Component Ratio
FY2019FY2020
28%
34%
16%
18%
32%
32%
10%
14%
14%
2%
100%
100%

60.0
47.7

Results of JALPAK Co., Ltd. and JAL Card Co, Ltd. are shown in the table below.

Revenue-and Capacity-Linked Cost2

2
Passengers (ʼ000)*（％）

FY2020y/y

30,000(2) Other Businesses

Fixed Cost

Passenger Revenue (JPY Bn)*

● Passenger Revenue

y/y

70.0

The JAL Group Value Creation Story

FY2020FY2019*1

80.0

Japanese GAAPFY2019

Revenues of international routes by geographic segment

Revenue Passenger-Load factor (%) (right hand scale)*1

40,000*1 Passengers with mileage award tickets are included from FY2020 due
to revenue recognition change by applying IFRS and also included in theprevious year’s figures for comparison analysis*2 Revenue per Passenger = Passenger Revenue / Passengers*3 Yield = Passenger Revenue / RPK*4 Unit Revenue = Passenger Revenue / ASKJALPAK CO., Ltd.

1) International Passenger Operations (Full Service Carrier)*1■ RPK (million passenger kilometers) (left hand scale)*1■ ASK (million seat kilometers) (left hand scale)

Foreword

The revenue in Air Transportation Segment decreased by
65.8% year on year to 431.8 billion yen and the loss before
investing, financing and income tax (hereinafter referred as“Segment profit (or loss)”) was 403.3 billion yen (segment
profit 74.7 billion yen in the same period in the previous year).
(Revenue and Segment profit (or loss) are before elimination oftransactions between segments.)
Details of revenue are shown in the table on the right. Theinternational passenger revenue for ZIPAIR, engaging in LCC
business, was 51 million yen.

Domestic Passengers

4. Profit Attributable to Owners of Parent

Loss attributable to owners of parent
▼¥

286.6

billionThe loss attributable to owners of the parent was 286.6 billion yen (the profit attributable to owners of the parent 48 billion yen in
the previous year) as a result of income tax expense decrease by recording deferred tax asset.

JAL REPORT 2021

132

Chapter3

Data Book

5. Cash Flows

Data Highlights

Business Data

Financial Data

ESG Data

Cash Flows from Operating Activities

Cash Flows from Investing Activities

Cash Flows from Financing Activities

▼¥

▼¥

▼¥

219.5

billion

91.0

billion388.6

billionThe balance of Cash and Cash equivalents at the end of the current fiscal year increased by 79.1 billion yen from the end of theprevious fiscal year to 408.3 billion yen.

Cash Flow from Operating Activities

Cash Flow*1

As a result of adding back or subtracting non-cash items
including depreciation, retirement benefit liabilities, operatingreceivables and operating payables to/from loss before income
tax of 404 billion yen, cash flow (outflow) from operating
activities was 219.5 billion yen (cash inflow of 80.8 billion yen
for the previous year).

Cash Flow from Investing Activities

Free Cash Flow*
Cash Flow from Financing
Activities
3
Total Cash Flow*
2

Cash flow from investing activities (outflow) was 91 billion yen
mainly due to expenditures for acquiring Fixed assets (cashoutflow of 233.7 billion yen for the previous year).

EBITDA*

4

Cash Flow from Financing Activities

80.8▼219.5▼300.3

162.4

182.4

+20.0

▼233.7▼91.0+142.7▼245.2▼97.8+147.4▼152.8▼310.5▼157.6

▼38.8

388.6

+427.4▼191.678.0+269.7251.2▼215.8▼467.0

¥

88.3

Large
Middle1,982.2

2,107.2

Cash and Deposits

329.1

408.3

+79.1

Balance of Interest-bearing Debt

277.4

515.1

+237.738.6（11.0）

69.6（20.5）+31.0（+9.4）

EquityEquity decreased by 68 billion yen from the end of the previous
fiscal year to 981.5 billion yen, as a result of increase in Net
loss.

Repayment within
2
one year*
Shareholdersʼ Equity*

3

Shareholdersʼ Equity Ratio (%)*

4

D/E Ratio (x)*5+125.01,014.2

947.4

▼66.8

51.2%

45.0%

▼6.2pt

0.3x

0.5x

+0.3x

*1 IFRS is adopted from FY2020 and to the figures in the previous year toenable comparison analysis*2 Figures in brackets represent aircraft lease payment within one year​*3 Equity attributable to owners of the parent*4 Ratio of equity attributable to owners of the parent to total assets*5 Interest-bearing Debt/ Shareholders’ Equity

Total

Owned

LeasedTotal 1

Total 2

retiredaircraftexcluded

Total 2 of
Mar/21 Mar/20

Airbus A350-900

4

1

5

4

4

8

8

+3

Boeing 777-300ER

13

0

13

13

0

13

13

—

Boeing 777-300

4

0

4

4

0

4

0 *

▼4

Boeing 777-200ER

11

0

11

11

0

11

6

▼5

Boeing 777-200

11

0

11

9

0

9

0

▼11

2

43

1

44

41

4

45

27

▼17

Boeing 787-9

17

3

20

17

3

20

20

—

Boeing 787-8

27

0

27

27

0

27

27

—

Boeing 767-300ER

29

0

29

29

0

29

29

—

Boeing 767-300

5

0

5

2

0

2

2

▼3

78

3

81

75

3

78

78

▼3

43

19

62

43

18

61

61

▼1

Boeing 737-800

43

19

62

43

18

61

61

▼1

Embraer 170/
Embraer 190

32

0

32

32

0

32

32

—

De Havilland
DHC-8-400CC

5

0

5

5

0

5

5

—

Small-sized Total*2

SAAB340B

5

0

5

3

0

3

2

ATR42-600/
ATR72-600

9

1

10

10

1

11

11

+1

Regional Total

51

1

52

50

1

51

50

▼2

FSC Total

215

24

239

209

26

235

216

▼23

2

0

2

2

0

2

2

—

2

0

2

2

0

2

2

—

217

24

241

211

26

237

218

▼23

Boeing 787-8
LCC Total
FSC – LCC Total

8. Credit Ratings(As of September 2021)

Rating & Investment Information, Inc. (R&I)

Issuer rating

A– (Negative)

Japan Credit Rating Agency, Ltd. (JCR)

Long-term issuer rating

A (Negative)▼3*1 FSC = Full Service Carrier*2 The difference between Total 1 and Total 2 is retired aircraft as of the end of March 2021, Total

9. Fuel and Exchange Rate Hedging(1) Hedging Policy
On international routes, fuel surcharges allow the Company
to offset some of its fuel costs. As a result, the Company uses
fuel hedging for fuel used on domestic routes. In addition,
the Company’s foreign currency revenues are roughly thesame as its foreign currency expenses, excluding fuel costs.
Consequently, the Company uses fuel and exchange rate
hedging only for fuel costs.

Fuel hedging

Forex hedging

Fuel use

Foreign currency
revenues

Foreign currency
expensesNon-fuel
costs

FSC*
revenuereceived
2

InternationalroutesFuel costs
Domestic
routesHedgedThe Company is exposed to fuelcost risks on domestic routes,
1
which do not have the FSC*The Company is exposed to forex
risks related to fuel costs, as foreign
currency expenses excluding fuelcosts are largely offset by foreign
currency revenues

Data Book

Small

Liabilities increased by 193.1 billion yen from the end of theprevious fiscal year to 1,125.7 billion yen due to increase inInterest-bearing debt and decrease in Contract liability.

Diff.

Medium Term Management Plan

LeasedMiddle-sized Total

Regional

Diff.

Owned

Large-sized Total

1(JPY Bn)
End of FY2019 End of FY2020

billionEnd of Mar/21(March 31, 2021)

End of Mar/20(March 31, 2020)

FSC*

Liabilities

JAL’s current credit ratings are shown in thetable on the right.

CapitalCapitalinvestment
investment

Fiscal 2020 Fleet

LCC

1

%

The JAL Group Value Creation Story+ Cash Flow from Financing Activities*4 EBITDA=EBIT+ Depreciation

19 aircraft.

JAL REPORT 2021

Balance Sheet*
Total Assets

Assets at the fiscal year-end increased by 125 billion yen fromthe end of the previous fiscal year to 2,107.2 billion yen, mainly
due to Cash and Cash equivalents increase.

45.0

billionenable comparison analysis*2 Cash Flow from Operating Activities + Cash Flow from Investing Activities*3 Cash Flow from Operating Activities + Cash Flow from Investing Activities

6. Capital Investment and Aircraft Procurement

133

Assets

*1 IFRS is adopted from FY2020 and to the figures in the previous year to

Cash flow from financing activities (inflow) was 388.6 billion
yen due to Long term debts and issuance of new shares (cashoutflow of 38.8 billion yen for the previous year).

Capital investment in fiscal 2020 totaled 88.3
billion yen (including expenditure for intangible
assets). In JAL Group has made investments
for the introduction of new aircraft to improve
operational efficiency, for intangible assets
including investments to increase competitivenessto meet diverse customer needs, and for system
investments to improve convenience andefficiency.
The main capital expenditures in fiscal 2020 wereadvance payment to purchase four new aircraft(three Airbus A350-900s and one ATR42-600) andother aircraft. The following major assets weresold: three Airbus A350-900s, two Boeing 777200s, three Boeing 767-300s and two SAAB340Bs.
The three Airbus 350-900s that were sold wereconverted to leased aircraft in fiscal 2020, butwere not accounted for as sold or leased inaccordance with IFRS and are still recognized as
aircraft in the consolidated financial statements.
With regard to capital expenditure, we will carefully
select and steadily implement growth investmentsthat will contribute to the enhancement ofcorporate value, such as introducing new aircraftwith superior fuel efficiency and cabin comfort,
strengthening the LCC business, promoting
touchless self-services with greater efficiency, andinvesting in IT to improve customer convenience,as we restructure the financial foundation baseand invest for sustainable growth.

Diff.

947.4

Equity ratio

Foreword

Cash Flow from Operating
Activities
Depreciation andAmortization
Cash Flow from Investing
Activities
Capital Investment¥

Despite the difficult situation, we have secured Equity of 947.4
billion yen and Debt-Equity Ratio of 45.0%.

(JPY Bn)

FY2020FY2019

Shareholders’ equity

7. Financial Position*1 In normal times, the Company uses fuel hedging for fuel used on domestic(2) Overcome Market Risks
The impact of volatility in fuel prices is mitigated by hedging
and fuel surcharges, however there is some time lag of theireffects each year. However, over a medium-term timeframe,
the Company has been largely successful in mitigating the riskof fluctuations in fuel prices. Based on cumulative changes
in prices over a certain period of time, the Company has
offset the impact of those changes through hedging and fuelsurcharges.

routes, which is equivalent to approximately 40% of all fuel consumed by
the Group’s air transport operations*2 FSC = Fuel Surcharge

Image of Cumulative Impact of Price Fluctuations
Fuel prices / forex
FSC / hedging
Impact0Profit fluctuation

JAL REPORT 2021

134

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

12. Business Risks

10. Retirement Benefit Obligations
the capital of pooled assets to work under prescribed policies.
As of the end of the current fiscal year, 38 companies
from among Japan Airlines and consolidated subsidiaries
have a lump-sum retirement benefit plan. The Corporate
Pension Fund also has three funds, including the Japan
Airlines Welfare Pension Fund. Some subsidiaries overseas
also have defined benefit plans. The Japan Airlines Welfare
Pension Fund, whose parent company is Japan Airlines,
has introduced a plan similar to a cash balance plan as an
optional plan. Furthermore, the JAL Group Corporate Pension
Fund comprising domestic consolidated subsidiaries and othercompanies has introduced a cash balance plan.

2) Risk related to medium- to long-term changes inthe business environment

総還元推移（2016～2020年度）
（億円）
2,000

72.8

1,641
47.7

1,354

1,000
25.1

44.5
29.4

300

32.3
200

35.3
534

39.3

40.0

480

332

387

383

200
188

2016

2017

2018

2019

200
188

0.0

0

0.0

-1,000-2,000-3,000△2,866

親会社当期純利益
配当性向※1

日本基準

配当金総額
総還元性向※2

2019

2020

（年度）

IFRS

自己株式取得額※1 配当性向＝配当金総額/親会社当期純利益※3※2 総還元性向＝（配当金総額＋自己株式取得額）／親会社当期純利益※3※3 2016～2018年度の親会社当期純利益は法人税等調整額の影響額を除く(3) External Environment Risk such as
International Affairs and Economic Trends
1) External Environment Risk
The JAL Group’s air transportation business operates in Japanand markets worldwide. Air travel demand may be affectedby global economy trends, terrorist attacks, regional conflicts,
war and other events. In addition, the JAL Group’s services
are partly dependent on maintenance companies, airport
personnel, sky marshals, fuel suppliers, baggage handlingcompanies, security companies, and other third parties, which
could affect our business operations.

2) Competitive Risk

1,508
49.2

Climate change caused by global warming has become amajor global issue, and if large-scale natural disasters caused
by global warming were to occur in Japan more frequently,
it may affect our business performance. The aviationindustry consumes large amounts of fossil fuels, whichcause climate change; therefore, CO2 emission reduction
is a social need and an extremely important management
issue for the JAL Group. In light of the situation, we havedeclared our commitment to achieve net zero CO2 emissions
by 2050, requiring us to implement various measures suchas upgrading to fuel-efficient aircraft, procuring alternative
aviation fuel, and engaging in carbon pricing, all of which
may affect our business operations. Failure to meet the above
targets may undermine our reputation in society and affectour business operations.

(2) Natural Disaster Risk and Climate Change Risk
1) Natural Disaster Risk
The majority of JAL Group passengers use aircraft departingfrom or arriving at Haneda and Narita airports. Consequently,
these airports play a vital role in our air transportation
business.
In addition, our Information System Center, which plays a keyrole in managing JAL Group flights, reservations and otherservices, and the Integrated Operations Control (IOC), which
controls the global operation and scheduling of our fleet, areboth located in the Tokyo area.
Consequently, a major earthquake, volcanic eruption, or
major typhoon in the Tokyo area could lead to the protracted
closure of Haneda or Narita airports, while a fire, terrorist
attack or other incident at these key facilities could lead toa prolonged outage of the Group’s information systems and

The JAL Group faces severe competition in Japan and overseas
in areas such as routes, services, and pricing. On domestic
routes, we compete with other major Japanese airlines,
new low cost airlines, and super express train services. On
international routes, we compete with major domestic andinternational airlines, with competition intensifying on both
domestic and international routes, Alliances, codeshareagreements, and reciprocal air frequent flyer programs
between overseas and Japanese airlines are contributing to
the challenging environment.
Significant deterioration in this competitive climate andbusiness environment could affect JAL Group’s operations.
The JAL Group has partnerships with global partner airlines
in various forms such as joint business, alliance, codeshare,frequent flyer program, and so forth. In the non-aviation
business such as the mileage business, we are working tostrengthen our customer base by forging extensive partnership

JAL REPORT 2021

Data Book

0

200

（％）
85.0

80.9

Due to temporary restrictions on the movement of people
caused by the spread of COVID-19, IT-driven remote work
has proliferated in society. As a result of these changes insocial and behavioral patterns, changes in business air travel
demand may affect the business strategy of our air transportbusiness.

2) Climate Change Risk

Medium Term Management Plan

JAL REPORT 2021

we are not able to pay dividends to shareholders, but wewould like to ask their understanding in this situation.
When the spread of COVID-19 stops and our performance
returns to its track as air transportation demand comes backin Japan and the world, we will strive to realize stable andcontinuous shareholder return again, considering cash flow
and other financial situations of that time and going forward.

The JAL Group operates the air transportation businessin Japan and around the world. A global outbreak of an
unknown disease such as COVID-19, which has been
spreading around the world since the beginning of 2020,
could bring about a sharp drop in air passenger demand
due to restrictions on the movement of people to prevent
infection, such as government-imposed travel restrictions andvoluntary restraint from going out, and voluntary restraint
from using aircraft by companies and passengers. As theGroup’s air transportation business has a high proportionof fixed costs such as aircraft costs and personnel costs, ashort-term sharp decline in demand could seriously affectthe performance of air transport operators including the JAL
Group.

operational capabilities, which would have a severe impact on
the Group’s operations.
To mitigate the risk of a shutdown of the Integrated
Operations Control in Tokyo, some of its functions havebeen transferred to the Operations Control Center at Osaka
International Airport which is in 24-7 operation, but it is not a
substitution for all the functions of the IOC in Tokyo.

The JAL Group Value Creation Story

135(1) Pandemic Risk
1) Risks related to short-term impact on businessperformance

11. Shareholder Returns
JAL regards shareholder returns as one of our most importantmanagement matters. Our fundamental policy is to actively
implement shareholder returns through continuous andstable dividends and flexible share repurchases, while
securing internal reserves for making investments forcorporate growth in the future and changing businessenvironments and to build a strong financial structure.
JAL will decide the dividend per share level, considering
its continuity, stability and predictability with reference
to a payout ratio of approximately 35%. In addition, JAL
will proactively and flexibly consider share repurchases,
considering its financial position and other factors. As aresult, JAL seeks to achieve a total payout ratio, which
combines the total dividends paid out and the total amountsof the share repurchases, of an approximately 35% to 50%
range through appropriately sharing periodic profits andallocating capitals among all of its stakeholders.
At the same time, JAL continuously strives to improve capitalefficiency through monitoring a total return on equity ratio,
which is calculated by dividing the sum of total dividends
paid out and share repurchases by shareholders’ equity. JAL
makes its efforts to maintain this ratio at approximately 3%
or above.
The effect of the spread of the COVID-19 infection has asignificant impact on the JAL Group, nonetheless it is yet
temporary and it does not cause fundamental change to our
profit structure, therefore, we will not change the above
basic policy.
However, the long-lasting COVID-19 spread affected an
airline industry including the JAL Group severely, resulting
in a huge loss of 398.3 billion yen in EBIT for this fiscal year.
And this situation still continues. Considering the above
situations, in order to secure liquidity at hand, we regret that

The JAL Group has identified numerous risks that could havea material impact on investment decisions. The list is not
exhaustive and the JAL Group may be affected by unforeseenrisks not described below. This report also contains forwardlooking statements based on information available to theCompany as of March 31, 2021. The JAL Group is exposed to
the following principal risks due to the nature of its businessactivities, centered on the scheduled air transportation
business and non-scheduled air transportation business.

Foreword

Japan Airlines and major consolidated subsidiaries havefunded- and unfunded-defined benefit plans and defined
contribution plans covering substantially all of theiremployees. At the time of retirement, a premium severance
package may be paid which is not subject to defined benefit
plan obligations based on actuarial calculations in accordancewith IFRS. These pension plans are exposed to generalinvestment risks, interest rate risks, life risks, and other risks,
but are not considered to be significant risks. Accumulated
defined benefit plans are operated by pension funds that arelegally segregated from the JAL Group. The board of directorsof pension funds or outsourced companies are required bylaw to act in the interests of members with priority and put

136

Chapter3

Data Book

Data Highlights

Business Data

relationships with other industries, The JAL Group’s alliancestrategy may be affected by changes in operating conditionsat other partner airlines including oneworld members or joint
business partners, and by changes in the oneworld alliancemembership or major developments in the Group’s alliancerelationships.

(5) Market Fluctuation Risk
1) Fuel Price Fluctuation Risk

2) Exchange Rate Fluctuation Risk

3) Capital Market Risk and Financial Market Risk
The JAL Group needs to make significant capital expenditures
such as the procurement of new aircraft. To finance theseinvestments, we may take out loans from financial institutions

137

JAL REPORT 2021

The JAL Group implements a wide range of measures ona daily basis to ensure the safe operation of its flights.
However, a single fatal accident has the potential ofundermining customer trust in flight safety of the JAL Groupand lead to a loss of public support. We must also provide
compensation for any passenger fatalities or injuries in theevent of an accident, which could have a severe impact
on our operating performance. In addition, safety issues
related to the JAL Group, the same aircraft type operated by
the Group or codeshare flights could undermine customer
trust in JAL Group’s flight safety and lead to a loss of public
support, which could affect our operating performance. To
limit the impact of legal damages related to air accidents andto ensure those affected by any accident receive sufficientcompensation, we have purchased liability insurance thatprovides an internationally recognized level of compensationand coverage.

(7) Regulatory Risk, Environmental Compliance
Risk and Litigation Risk

3) Litigation Risk
JAL Group business activities are exposed to the risk ofvarious types of litigation, which could affect its operations
and operating performance. In the event that a litigation is
filed against the JAL Group, developments in the subsequent
legal case may require additional costs and the booking
of provisions, which could also affect our operating
performance.

(9) HR Risk and Industrial Relations Risk
JAL Group businesses are dependent on hiring humanresources who possess national certificates or other legallyrequired qualifications related to aircraft operation. However,
due to the considerable amount of time required to acquire
these qualifications and skills during the course of theirduties, the JAL Group may not be able to hire sufficienthuman resources when required, which could affect ourbusiness performance. In addition, many of our employees
belong to labor unions, and a collective strike or other labor
disputes could affect flight operations.

(8) IT Risk and Customer Data Protection Risk
JAL Group operations are dependent on many IT systems,
and system failures caused by flaws in computer programs,
computer viruses, and other cyber-attacks may lead to theloss of critical data, as well as flight operation issues, which
could affect the Group’s operations. Large-scale failures in
power systems, communication networks, other infrastructurethat support IT systems, and Cloud services for emailcommunications could also result in significant disruption to
our business performance.
In addition, inadequate handling of personal data or data
breaches caused by unauthorized access could undermine
public trust in our business, systems and corporate brandand also customer and market trust, which could affect ourbusiness performance.

JAL Group’s operations are subject to various international
legal restrictions and national and local government laws
and regulations. Revisions to these laws and regulations may
result in even heightened restrictions on our operations,which could lead to a significant increase in costs.

1) Regulatory Risk
The JAL Group operates flights in accordance with various
rules and regulations, such as Japan’s Civil Aeronautics Act
and other regulations governing airline businesses, bilateralaviation agreements and other international arrangements,
Japan’s Antimonopoly Act and other similar antitrust laws
overseas, and rules on taxes and public dues such as landing
fees. Revisions to these rules and regulations or notificationsof legally enforceable airworthiness directives could have an
impact on our operating performance.
Moreover, the allocation of flight slots at Haneda Airport andother airports that are central to the Group’s air transportbusiness could also affect our business performance.

Data Book

The JAL Group operates in countries other than Japan, andsome of the revenues and expenses are denominated inforeign currencies. In particular, aviation fuel prices, one ofour main expenses, is largely linked to the US dollar. US dollar
exchange rate fluctuations, therefore, have a greater impact
on our expenses than on its revenues. To mitigate the impact
of exchange rate volatility on profits, the JAL Group uses
foreign currency revenues to offset foreign currency expenses
and foreign currency hedging transactions. The price of new
aircraft is also closely linked to the US dollar, which means
we are also exposed to the risk of exchange rate fluctuations
when recording the value of assets and depreciation costs
related to aircraft. To mitigate this risk, we use hedging
transactions to diversify opportunities for foreign currency
exchange.

(6) Aviation Safety Risk

such as preventing global warming, the JAL Group is facingtighter restrictions on CO2 emissions, noise pollution,
harmful substances, and other environment issues. A further
tightening of environmental regulations leading to a higher
cost burden through emission charging mechanisms or otherschemes, such as a new greenhouse gas trading system tobe implemented from fiscal 2020 at earliest, could have an
impact on our operating performance.

Medium Term Management Plan

Fluctuations in fuel prices have a significant impact on JAL
Group’s business performance. We charge a fuel surcharge
to partly cover the impact of higher fuel prices, but fuelprice fluctuations are not immediately reflected in the fuelsurcharge and it is inappropriate to ask customers to cover theentire increase in fuel prices. We also use crude oil hedging
transactions to mitigate the risk of fuel price volatility.
However, a sudden and steep drop in oil prices may notcontribute to an improvement in our operating performance,as the benefits of the decline would not be reflected inbusiness results immediately due to hedge contract positions
and other factors.

or capital markets, and our ability to raise money and pay
costs for the loans are affected by capital and financial market
trends and by changes in our credit rating, which may limit
our access to loans and lead to higher financing costs.
Furthermore, the JAL Group posts deferred tax assets, but if
the expected amount of future taxable income should decline
or if past deferred tax assets are reversed due to tax revisions
or such, the Group’s financial position may be temporarily
affected.

The JAL Group Value Creation Story

In the air transportation business, the JAL Group places
orders for aircraft with the Boeing Company, Airbus SAS,
Embraer SA, ATR, and Mitsubishi Aircraft Corporation toincrease efficiency by upgrading to fuel-efficient aircraft andreducing aircraft types in the fleet. However, the deliveryof new aircraft may be delayed due to technical, financial,and other reasons at aircraft manufacturers, which could
force adjustments to fleet plans that may affect JAL Group’s
operations over the medium and long term.

ESG Data

Foreword(4) Aircraft Delivery Risk

Financial Data

2) Environmental Compliance Risk
Amid growing pressure on companies in recent years tofulfill their corporate social responsibility to the environment

JAL REPORT 2021

138

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Consolidated financial statements(1) Consolidated statement of financial position
As of April 1,
2019

As of March 31,
2020

As of March
31, 2021

As of March
31, 2021

As of April 1,
2019

As of March 31,
2020

As of March
31, 2021

As of March
31, 2021

Millions of yen

Millions of yen

Millions of yen

Thousands of
U.S. dollars

Millions of yen

Millions of yen

Millions of yen

Thousands of
U.S. dollars

Trade and other payables

137,684

125,208

97,185877,833

Interest-bearing liabilities

38,40838,61869,621

628,859
383,795

Liabilities and equity

AssetsLiabilities

Current assets
522,064

329,149

408,335

3,688,329

Trade and other receivables

144,053

94,07176,760693,342

Other ﬁnancial assets

5,067

1,305

14,133

127,657

Inventories

23,682

28,40923,680213,892

Other current assets

46,44255,50044,906405,618

Total current assets

741,309508,435

567,816

5,128,859

Non-current assets

Other ﬁnancial liabilities

39,10851,06542,490

Income taxes payable

19,192

2,824

3,890

35,136

Contract liabilities

294,663

251,809215,239

1,944,169

Provisions

–

1,220

3,750

33,872Other current liabilities

49,91630,90344,714

403,884

Total current liabilities

578,972

501,651476,893

4,307,587

Interest-bearing liabilities

185,920

238,811445,525

4,024,252

Other ﬁnancial liabilities

8,771

13,913

23,479212,076

Deferred tax liabilities

163

222

108

975

Provisions

14,594

14,645

15,667

141,513
1,383,515

Non-current liabilities
795,439

894,835

827,587

7,475,268

Advances on ﬂight equipment

138,569

102,519

129,882

1,173,173

Other tangible ﬁxed assets

77,49586,462

87,942

794,345

Retirement beneﬁt liability

256,305

151,330

153,169

Total tangible ﬁxed assets

1,011,504

1,083,817

1,045,413

9,442,805

Other non-current liabilities

13,243

12,062

10,89998,446

Total non-current liabilities

478,999

430,985

648,850

5,860,807

1,057,972

932,637

1,125,744

10,168,403

Intangible assets

92,255

95,777

89,662809,881

Investments accounted for using equity method

31,697

31,10524,232

218,878

Other ﬁnancial assets

119,515120,218

128,055

1,156,670

Share capital

181,352

181,352

273,200

2,467,708

Deferred tax assets

143,422

122,323

225,886

2,040,339

Capital surplus

182,437

182,437

273,557

2,470,933

Retained earnings

666,030

645,408

352,965

3,188,194

(408)

(408)

(408)

(3,685)

Financial assets measured at fair value throughother comprehensive income

31,097

28,79335,468320,368

Effective portion of cash ﬂow hedges

1,837(23,146)

12,877116,312

–

(141)

(201)

(1,815)32,934

5,506

48,144434,865

1,062,345

1,014,295

947,4598,558,025

33,33035,321

34,075

307,786

1,095,675

1,049,617

981,535

8,865,820

2,153,648

1,982,254

2,107,279

19,034,224

1,178

938

3,176

28,687

Other non-current assets

12,765

19,63823,036208,075

Total non-current assets

1,412,338

1,473,819

1,539,462

13,905,356

2,153,648

1,982,254

2,107,279

19,034,224

Total assets

EquityTreasury shares
Accumulated other comprehensive income

Exchange differences on translation of foreign
operations
Total accumulated other comprehensive income
Total equity attributable to owners of parent
Non-controlling interests

JAL REPORT 2021

JAL REPORT 2021

Data Book

Total equity
Total liabilities and equity

139

Medium Term Management Plan

Retirement beneﬁt asset

Total liabilities

The JAL Group Value Creation Story

Tangible ﬁxed assets
Flight equipment

Current liabilities

Foreword

Cash and cash equivalents

140

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data(2) Consolidated statement of profit or loss and other comprehensive income(3) Consolidated statement of changes in equity
For the year ended March 31, 2020 (April 1, 2019 to March 31, 2020)

FY2019FY2020(April 1, 2019 –March 31, 2020)(April 1, 2020 –March 31, 2021)(April 1, 2020 –March 31, 2021)

Millions of yen

Millions of yen

Thousands of
U.S. dollars

486,217
529,707369,989
1,385,914
9,069

27,969174,006
279,249
481,225
13,397

252,633
1,571,727
2,522,346
4,346,716
121,009291,317
243,420
164,383
609,759
1,308,881
86,103

254,80996,788
190,585
342,854885,037(390,414)

2,301,589
874,248
1,721,479
3,096,865
7,994,192(3,526,456)

1,396(7,582)(68,485)

87,5002,694
3,003(398,306)(3,594,950)
24,33327,124(3,597,741)

1,799
7,570
(404,078)(116,202)(287,875)

16,24968,376(3,649,878)(1,049,607)(2,600,261)

48,057
3,955(286,693)(1,182)(2,589,585)(10,676)(2,702)

3,284

29,6639,875(2,394)(21,624)

(171)

87

785

7,001

977

8,824

(23,250)(162)

34,411(138)

310,821(1,246)(1,302)

1,445

13,052(24,714)(17,713)
34,29835,71836,695(251,179)

322,626
331,451(2,268,801)

Owners of parent

30,430(249,956)(2,257,754)

Non-controlling interests

3,868(1,223)(11,046)

Earnings per share
Basic earnings (loss) per share
Diluted earnings per share

141

JAL REPORT 2021

Yen

140.04–

Yen(764.99)–

U.S. dollars(6.90)–

Proﬁt (loss)

Effective
portion of cash
ﬂow hedges

Millions of yen

Millions of yen

Millions of yen(408)

31,097

1,837

–

–

–

Capital surplus

Retainedearnings

Treasury shares

Millions of yen

Millions of yen

Millions of yen

181,352

182,437

666,030––

48,057

Other comprehensive income

–

–

–

–

(2,813)(24,560)

Comprehensive income––

48,057–(2,813)(24,560)

Dividends––(38,058)–––

Transfer to hedged non-ﬁnancial assets

–

–

–

–

–

(422)

Purchase of treasury shares

–

–

–

(39,999)––

Retirement of treasury shares––(39,999)

39,999Acquisition of subsidiaries

–

–

–

–

–

–

–

Changes in ownership interest in subsidiaries

–

–

–

–

–

–

Change in ownership interest of investments
accounted for using equity method

–

(0)

–

–

–

–

Transfer to retained earnings

–

–

9,378

–

509

–

–

(0)

(68,679)

–

509

(422)

181,352

182,437

645,408(408)

28,793(23,146)

Total transactions with owners and so
forth
Balance as of March, 2020

Equity attributable to owners of parent
Accumulated other comprehensive income

Balance as of April 1, 2019Non-controllinginterests

Total equity

Millions of yen

Millions of yen

Millions of yen

Exchangedifferences ontranslation offoreign
operations

Total equity
Total
attributable toRemeasurements accumulated
owners of parentof deﬁned
other
beneﬁt planscomprehensive
incomeMillions of yen

Millions of yen

Millions of yen––

32,934

1,062,345

33,3301,095,675–––

48,057

3,955

52,012Other comprehensive income

(141)

9,888

(17,627)(17,627)(86)(17,713)Comprehensive income

(141)

9,888

(17,627)

30,4303,868

34,298Dividends–––(38,058)(2,376)(40,435)

Transfer to hedged non-ﬁnancial assets

–

–

(422)

(422)

–

(422)

Purchase of treasury shares

–

–

–

(39,999)–(39,999)

Retirement of treasury shares

–

–

–

–

–

–

Acquisition of subsidiaries

–

–

–

–

98

98

Proﬁt (loss)

Changes in ownership interest in subsidiaries

–

–

–

–

401

401

Change in ownership interest of investments
accounted for using equity method

–

–

–

(0)

0

–

Transfer to retained earnings–(9,888)(9,378)

–

–

–

–

(9,888)(9,801)(78,480)(1,876)(80,357)

(141)

–

5,506

1,014,295

35,321

1,049,617

Total transactions with owners and so
forth
Balance as of March 31, 2020

JAL REPORT 2021

Data Book

Comprehensive income attributable to

Balance as of April 1, 2019

Financial assets
measured atfair value
through othercomprehensive
incomeShare capital

Medium Term Management Plan

1,102
1,760
88,14936,13752,012

Accumulated othercomprehensive income

The JAL Group Value Creation Story

2,399
1,091
88,807(397,997)

Equity attributable to owners of parent

Foreword

Revenue
International passenger revenue
Domestic passenger revenue
Other revenue
Total revenue
Other income
Operating expenses
Personnel expenses
Aircraft fuelDepreciation, amortization and impairment losses
Other operating expenses
Total operating expenses
Operating proﬁt (loss)
Share of proﬁt (loss) of investments accounted for using equity
methodProﬁt (loss) before investing, ﬁnancing and income tax
Income/expenses from investments
Investing income
Investing expenses
Proﬁt (loss) before ﬁnancing and income tax
Finance income/expenses
Finance income
Finance expenses
Proﬁt (loss) before tax
Income tax expense
Proﬁt (loss)
Proﬁt (loss) attributable to
Owners of parent
Non-controlling interests
Other comprehensive income
Items that will not be reclassiﬁed to proﬁt or loss
Financial assets measured at fair value through othercomprehensive income
Remeasurements of deﬁned beneﬁt plans
Share of other comprehensive income of investments accounted
for using equity method
Total of items that will not be reclassiﬁed to proﬁt or loss
Items that may be reclassiﬁed to proﬁt or loss
Effective portion of cash ﬂow hedges
Exchange differences on translation of foreign operations
Share of other comprehensive income of investments accounted
for using equity method
Total of items that may be reclassiﬁed to proﬁt or loss
Other comprehensive income, net of tax
Comprehensive income

FY2020142Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

For the year ended March 31, 2021 (April 1, 2020 to March 31, 2021)

For the year ended March 31, 2021 (April 1, 2020 to March 31, 2021)
Equity attributable to owners of parent

Equity attributable to owners of parent
Accumulated othercomprehensive income

Accumulated othercomprehensive income

Financial assets
measured atfair value
through othercomprehensive
incomeEffective
portion of cash
ﬂow hedges

Millions of yen

Millions of yen

Millions of yen

Share capital

Capital surplus

Retainedearnings

Treasury shares

Millions of yen

Millions of yen

Millions of yen

182,437

645,408(408)

28,793(23,146)––(286,693)–––

Other comprehensive income

–

–

–

–

3,275

35,871––(286,693)

–

3,275

35,871

91,84891,120––––Comprehensive income
Issuance of new shares

Thousands of
U.S. dollars

Thousands of
U.S. dollars

Thousands of
U.S. dollars(209,068)

Retainedearnings

Treasury shares

Thousands of
U.S. dollars

Thousands of
U.S. dollars

Thousands of
U.S. dollars

1,638,081

1,647,881

5,829,717(3,685)260,075

Proﬁt (loss)––(2,589,585)

–

–

–

Other comprehensive income

–

–

–

–

29,581

324,008––(2,589,585)–

29,581

324,008

829,626

823,051

–

–

–

–

Balance as of April 1, 2020

Comprehensive income
Issuance of new shares

–

–

–

–

–

152

Transfer to hedged non-ﬁnancial assets

–

–

–

–

–

1,372

–

–

–

(0)

–

–

Purchase of treasury shares

–

–

–

(0)

–

–

–

(0)

–

–

–

–

–

–

(51,928)–

30,701–

829,626

823,051(51,928)(0)30,701

1,372

2,467,708

2,470,933

3,188,194(3,685)

320,368

116,312

Non-controllinginterests

Total equity

Changes in ownership interest
due to purchase of shares of consolidated
subsidiaries

–

(0)

–

–

–

–

Changes in ownership interest
due to purchase of shares of consolidated
subsidiaries

Transfer to retained earnings––(5,749)

–

3,399

–

Transfer to retained earnings

Balance as of March 31, 2021

91,84891,120(5,749)

(0)

3,399

152

273,200

273,557

352,965(408)

35,46812,877

Total transactions with owners and so
forth
Balance as of March 31, 2021

Equity attributable to owners of parent

Equity attributable to owners of parent

Accumulated other comprehensive income

Accumulated other comprehensive income

Non-controllinginterests

Total equity

Total equity
Total
attributable toRemeasurements accumulated
ownersof parentof deﬁned
other
beneﬁt planscomprehensive
incomeMillions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Millions of yen

(141)

–

5,506

1,014,295

35,321

1,049,617–––(286,693)(1,182)(287,875)

Other comprehensive income(60)(2,349)36,73636,736(40)

36,695Comprehensive income(60)(2,349)36,736(249,956)(1,223)(251,179)

Issuance of new shares

–

–

–

182,968–

182,968

Transfer to hedged non-ﬁnancial assets

–

–

152

152

–

152

Purchase of treasury shares

–

–

–

(0)

–

Proﬁt (loss)

Thousands of
U.S. dollars

Thousands of
U.S. dollars

Thousands of
U.S. dollars

Thousands of
U.S. dollars(1,273)–49,7339,161,728

319,040

9,480,778–––(2,589,585)(10,676)(2,600,261)

Other comprehensive income(541)(21,217)331,821331,821(361)

331,451

Comprehensive income(541)(21,217)331,821(2,257,754)(11,046)(2,268,801)

Issuance of new shares

–

–

–

1,652,678–

1,652,678

Transfer to hedged non-ﬁnancial assets

–

–

1,372

1,372

–

1,372

(0)

Purchase of treasury shares

–

–

–

(0)

–

(0)

Changes in ownership interest
due to purchase of shares of consolidated
subsidiaries

–

–

–

(0)

(198)

(207)

Transfer to retained earnings–

21,21751,928––––21,21753,301

1,654,060(198)

1,653,852(1,815)–434,8658,558,025

307,7868,865,820

–

–

(0)

(22)

(23)

Transfer to retained earnings

–

2,349

5,749

–

–

–

–

2,349

5,901

183,121(22)

183,098(201)–

48,144

947,459

34,075981,535

JAL REPORT 2021

Balance as of April 1, 2020
Proﬁt (loss)

Total transactions with owners and so
forth
Balance as of March 31, 2021

JAL REPORT 2021

Data Book

Thousands of
U.S. dollars–

Balance as of March 31, 2021

Total equity
Total
attributable toRemeasurements accumulated
ownersof parentof deﬁned
other
beneﬁt planscomprehensive
incomeThousands of
U.S. dollars

Changes in ownership interest
due to purchase of shares of consolidated
subsidiaries
Total transactions with owners and so
forth

Exchangedifferences ontranslation offoreign
operations

Medium Term Management Plan

Exchangedifferences ontranslation offoreign
operations

Balance as of April 1, 2020

The JAL Group Value Creation Story

Transfer to hedged non-ﬁnancial assets
Purchase of treasury shares

Total transactions with owners and so
forth

143

Effective
portion of cash
ﬂow hedges

Capital surplus

Foreword

181,352

Proﬁt (loss)

Balance as of April 1, 2020

Financial assets
measured atfair value
through othercomprehensive
incomeShare capital

144

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data(4) Consolidated statement of cash flows
Notes

FY2020FY2019FY2020(April 1,2019 –March 31, 2020)(April 1,2020 –March 31, 2021)(April 1,2020 –March 31, 2021)

Millions of yen

Millions of yen

Thousands of
U.S. dollars

ESG Data
Environment (E)Cash ﬂows from operating activities

Unit

FY2016FY2017FY2018FY2019FY202088,149(404,078)(3,649,878)

164,383

190,585

1,721,479

2,691

2,150

19,420

Total

thousand ton-CO2

8,764

9,083

9,343

9,103

Increase (decrease) in retirement beneﬁt liability(91,001)(1,677)(15,147)

CO2 emissions from aircraft

thousand ton-CO2

9,070

9,330

9,090

(3,018)(20,892)

8,750

Interest and dividend income(2,313)4,406
14,405*
4,393

Interest expenses

1,332

2,927

26,438Proportion of CO2 emissions from aircraftof GHG Scope 1

%

99.8

99.9

99.9

99.9

99.7

(8,635)CO2 emission from Ground Equipment*2

thousand ton-CO2

14

13

thousand ton-CO2

57.5

54

13
50
3
39*

13
57
3
39*

13
51
3
34*

Total

thousand ton-CO2

444.1

460.2

478.5

Proﬁt (loss) before tax
Depreciation, amortization and impairment losses

11,12,
13,18

Loss (gain) on sale and retirement of non-current assets

785

(956)

Greenhouse gas emissions
GHG Scope 1(1,396)

7,582

68,485

GHG Scope 2*2

64,5292,597

23,457GHG Scope 3

Decrease (increase) in inventories(4,695)4,809

43,437

Increase (decrease) in trade and other payables(15,282)(27,036)(244,205)

Category 1: Purchased goods and services

thousand ton-CO2

—

—

—

1,511.4
4(2,282.6)*
322

Increase (decrease) in contract liabilities(43,043)(36,705)(331,541)

Category 2: Capital goods

thousand ton-CO2

—

—

—

721

264

Other, net(44,394)

32,550294,011(229,565)(2,073,570)

thousand ton-CO2

434

450

468
3
465*

4

119,039

Category 3: Fuel- and energy related activities(not included in Scope 1 or Scope 2)455(1,224)*3
4453* (1,221)*

601
3
596*

Income taxes refunded (paid)(38,181)

10,04590,732Category 5: Waste

thousand ton-CO2

—

—

—

2.6

2.2

Net cash provided by (used in) operating activities

80,857(219,519)(1,982,829)

Category 6: Business travel

thousand ton-CO2

4.3

4.3

4.4

4.6

4.7

Category 7: Employee commuting

thousand ton-CO2

5.8

5.9

6.1

6.1 (8.3)*

7.7

Category 8: Leased assets

Cash ﬂows from investing activities
Purchase of non-current assets

11,12(239,611)(89,686)(810,098)

Proceeds from sales of non-current assets

11,12

4,251

1,442

13,025Purchase of other ﬁnancial assets
Proceeds from sales and redemptions of other ﬁnancial
assetsPayments for loans receivable32(5,647)(8,118)(73,326)

32

1,671

2,254

20,359(233)(2,026)(18,300)

837

746

6,738

Collection of loans receivable

1,033

378

3,414

Dividends received

2,446

1,928

17,414

Other, net

1,526

2,069

18,688(233,725)(91,012)(822,075)

Net cash provided by (used in) investing activities
Cash ﬂows from ﬁnancing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings

31
31
31

Proceeds from issuance of bonds

31

Proceeds from issuance of shares

22Interest paid
Dividends paid

23

Repayments of lease liabilities

31

Other, net

31

Net cash provided by (used in) ﬁnancing activities
Effect of exchange rate changes on cash and cash equivalents

(54)

(487)

40,088

256,886

2,320,350(13,367)(20,539)(185,520)

thousand ton-CO2

—

—

—

0.1

0.1

GHG Scope 1+2

thousand ton-CO2

8,821.5

9,137.0

9,393.0

9,160.0

4,457.0

GHG Scope 1+2+3

thousand ton-CO2

9,265.6

9,597.2

9,871.5

10,671.4

5,611.4

Specific Fuel Consumption for Passenger Transport

L/100PK

3.316

3.192

3.132

3.225

4.195

Specific Fuel Consumption for Cargo Transport

L/TKT

0.368

0.355

0.348

0.358

0.466

Kerosene

thousand GJ

0.4

0.3

0.3

0.3

1.2

Heavy fuel oil A

thousand GJ

4.3

8.6

2.5

2.0

2.7

Town gas, LPG

thousand GJ

—

260

267

257

245

Electricity

thousand MWh

113

110

102

98

89

Steam, Heat, Coolingthousand GJ

—

332

340

332

317

Crude Oil Equivalentkl

44,93643,512

41,71740,15335,439Jet fuelthousand kl

3,547

3,678

3,784

3,684

1,781

Crude Oil Equivalent

thousand kl

3,359

3,483

3,583

3,488

1,687

Energy consumption (Fuel total)

thousand MWh—

37,57238,651

37,63018,229Energy consumption (Steam, Heat, Cooling)

thousand MWh

—

95

96

92

88

thousand tons -Nox

5.30

5.02

5.10

5.54

2.43

Basic Fuel Consumption Unit

Energy consumption (Ground)*5

Energy consumption (Aircraft)

39,750–––182,657

1,649,869(831)(1,412)(12,754)(38,146)

(31)

(280)

(2,384)––(24,625)(24,501)(221,307)

NOx (Nitrogen oxide)amount of emissions in LTO cycle*6
Specific NOx Emissions for Passenger Transport

g/PKT

0.054

0.047

0.046

0.053

0.065

Specific NOx Emissions for Cargo Transport

g/TKT

0.597

0.527

0.511

0.589

0.724

thousand tons-HC

0.71

0.63

0.63

0.66

0.13

thousand tons-CO

4.24

3.87

3.95

4.35

1.71

ton

—

24.5

26.3

27.7

23.7

kg

7.06

6.62

7.40

3.94

1.96

(39,316)(4,379)(39,553)(38,810)388,624

3,510,288(1,236)

1,094

9,881

Net increase (decrease) in cash and cash equivalents(192,914)

79,186715,256

Cash and cash equivalents at beginning of period

522,064

329,149

2,973,073

Cash and cash equivalents at end of period

329,149

408,335

3,688,329

The accompanying notes are an integral part of the consolidated financial statements.

Electricity Equivalent

NOx emissions

Other emissions
HC (Hydrocarbon)
amount of emissions in LTO cycle*6
CO (Carbon monoxide)amount of emissions in LTO cycle*6
VOC emissions
Total

Data Book

Dividends paid to non-controlling interests

22

275

Medium Term Management Plan

Interest received

4

1,154.4

The JAL Group Value Creation Story

Subtotal

Foreword

Foreign exchange loss (gain)
Share of loss (proﬁt) of investments accounted for using
equity method
Decrease (increase) in trade and other receivables

CFC substitute (Aircraft)

For more details, please see “Consolidated Financial Statements for the Year ended March 31, 2021” on JAL website.
https://www.jal.com/en/investor/library/finance/pdf/fy2020report_en0331.pdf

145

JAL REPORT 2021

Total

JAL REPORT 2021

146

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Environment (E)Social (S) Human resources data (Japan Airlines Co., Ltd. and 55 consolidated subsidiaries)
Unit

FY2016FY2017FY2018FY2019FY2020

Unit

Water consumption
Withdrawal
435

485
276※3

447
3
220*

335
3
203*

0

0

0

0

0

426

435

485

447

335

Tap water consumption

3

thousand m

426

Groundwater, Sea, River, Lake,
Industrial water consumption
Total consumption

thousand m3
thousand m3

Industrial Waste

FY2017FY2018FY2019FY2020persons

32,75333,03834,00335,65336,060

Number of ground staff

persons

24,05523,82824,29525,27825,244

Number of cockpit crews

persons

2,570

2,629

2,690

2,766

2,876

Number of cabin attendants

persons

6,128

6,581

7,018

7,609

7,940

Ratio of employees in management

%

15.9

15.8

15.5

14.8

15.0

Ratio of employees

%

84.1

84.2

84.5

85.1

85.0
48.3

Total waste generated (日本のみ)

ton

3,436

3,266

3,912

3,330

2,834

Ratio of male employees

%

52.5

51.6

50.2

49.4

ton

3,398

3,233

3,873

3,320

2,817

Ratio of female employees

%

47.5

48.4

49.8

50.6

51.7

Total waste disposed

ton

38

33

39

10

17

Ratio of female managers

%

16.3

16.3

16.8

18.4

19.5

PCB waste

ton

—

3

0.07

0

0

12.2

Final disposal rate

%

1.1

1.0

1.0

0.3

0.6

—

—

—

5

8

Boeing 787

number of aircrafts

33

36

42

49

49

Boeing 777

number of aircrafts

40

40

40

39

37

Boeing 737-800

number of aircrafts

53

57

62

62

61

Embraer 170

number of aircrafts

17

17

18

18

18

Embraer 190

number of aircrafts

5

12

14

14

14

ATR42-600

number of aircrafts

1

4

6

8

9

ATR72-600

number of aircrafts

—

—

1

2

2

Number of fuel-efficient aircrafts

number of aircrafts

149

166

183

197

198

Ratio of fuel-efficient aircrafts

%

65

72

79

82

84

Vehicle

—

—

—

—

3,604

Gasoline consumption

kl

—

—

—

—

495

Diesel consumption

kl

—

—

—

—

5,125

billion yen

—

168.2

175.4

181.3

55.3

Number of violations of legal obligations/regulations

cases

0

0

0

0

0

Amount of fines/penalties related to above violations

yen

0

0

0

0

0

ton

—

137.2

151.4

153.5

22.5

ton

—

0

0

11.8

6.3

%

—

46.0

45.4

47.4

47.4

VehiclesMotor Vehicles

Environmental Investments
Investments (航空機関連費用)
Environmental Violations

Food loss & waste
Food loss & waste in JAL Royal Catering
Narita and Haneda offices
Total weight composted among the foodloss & waste above
Ratio of passengers boarding from Narita andHaneda v.s. all International passengers
Use of petroleum-based single-use plastic(including self-employed lounges)
Total weight recycled (to reusable plastic) among
the use of petroleum-based single-use plastic above

10.5

11.3

11.5

185

200

218

216

218

Ratio of local hires at overseas offices*2

%

89.9

88.4

89.8

88.4

90.2

Ratio of locally hired managerial staff at overseas offices*2
Number of mid-carreer recruitment(Business planning staff hired in Japan)*2
Ratio of disabled employees*3

%

61.9

58.4

64.0

56.3

57.5

persons

29

20

14

50

6

%

2.56

2.69

2.69

2.62

2.67

persons (%)%——

2,340(7.1％)
2.6

2,422(7.1%)
2.0

3,711(10.4%)
1.9

2,352(6.5%)
1.1

years oldyears oldyears oldyears old

38.2
38.6
43.8
34.9

38.6
38.9
44.1
35.6

39.1
39.5
44.0
35.4

39.4
40.2
43.8
35.0

38.6
39.1
44.0
35.0

years

14.2

14.5

14.7

14.4

14.4

hours per person
cost per person (yen)66.4
403,51964.7
422,18770.8
470,698

72.3
449,480277.1
109,321thousand yen

6,737

7,021

7,126

6,684

5,638

%
hours
persons
persons
persons
hours

85.5
12.0
781
65
2,169
14,063

89.5
7.9
843
89
6,826
59,551

86.0
8.5
789
68
8,140
68,288

76.5
9.5
743
53
7,745
51,734

71.5
8.0
—
40
9,772
33,600

Employment, Turnover
Number of new employees (new employee hire rates)
Ratio of voluntary turnover*2
Age
Average age
Average age of ground staff
Average age of cockpit crew
Average age of cabin attendants
Years worked
Average years worked
Training
Training period per person
Training cost per person
Annual compensation
Average annual compensation of employees (all staff)
Workstyle
Ratio of paid holiday taken*2
Monthly average overtime hours worked per person*2
Childcare leave applicants*2
Nursing care leave applicants*2
Participants in voluntary activities
Total hours of voluntary activities
Wellness*4
Appropriate weight maintenance ratio

%

—

68.8

68.8

68.3

67.1

%

—

30.4

28.9

27.9

26.3

ton

—

1,438.3

1,585.3

1,754.1

228.8

Smoking ratio (male)
Smoking ratio (female)

%

—

6.0

5.5

5.0

4.2

ton

—

330.8

359.9

415.7

54.3

Stress check ratio
Breast cancer screening ratio(female employees aged 18 and above)
Breast cancer screening ratio(female employees aged 35 and above)

%

—

90.4

91.6

94.4

96.1

%

—

26.0

25.4

43.4

60.4

%

—

32.0

33.2

45.1

67.2

*1 Excludes in-flight catering facilities in Japan*2 In-flight catering facilities have been added to Head Office, Airport, Maintenance Center and Branch Offices from FY2019.
*3 10 hub airports of JAL Group in Japan*4 Basic unit from FY2020 is used in FY2019 ( ).
*5 Head Office, Airport, Maintenance Center, and Branch Offices*6 ICAO standard of counting take-off and landing as “one.”

Social (S) Communities
Unit

Increase of tourists to regional areas

JAL REPORT 2021

Data Book

Plastic

9.6

persons

Medium Term Management Plan

number of aircrafts%

Number of manegerial staff hired overseas*2

The JAL Group Value Creation Story

Airbus A350

Ratio of foreign employees in management position*1*2

Foreword

Consolidated staff headcountTotal waste used/recycled/soldNumber of Fuel-Efficient aircraft

147

FY2016

Staff%(v.s. FY19 result)

FY2016FY2017—FY2018—FY2019—FY2020—25.8

JAL REPORT 2021

148

Chapter3

Data Book

Data Highlights

Business Data

Financial Data

ESG Data

Company/Stock Information
Stock Information

Governance (G)Unit

FY2016FY2017FY2018FY2019• Stock Exchange The First Section of the Tokyo Stock Exchange

FY2020• Stock Code

Corporate GovernanceCompliance rate to the Corporate Governance Code
Number of directors on board*2

%

—

—

—

100

100

persons

10

10

10

10

10

30

30

30

30

2

1

1

1

1

persons

5

4

4

5

5

Number of information leakage incidents

cases

0

0

0

0

2

Number of corruption and bribery

cases

0

0

0

0

0

Percentage of users whose customer privacy
data is used for secondary purposes

%

0.0

0.0

0.0

0.0

0.0

Number of complaints received from outside
parties and substantiated by the organization
regarding privacy protection

cases

0

0

0

0

0

Number of complaints received from regulatory
bodies regarding privacy protection

cases

%

—

—

—

—

8.5

%

—

—

—

98.3

100

0

0

0

0

*1 (Locally hired managers overseas + Non-Japanese managers hired in Japan in business planning and maintenance engineering positions/Total managers*2 Japan Airlines Co., Ltd. only
*3 Aggregate of Japan Airlines Co., Ltd. and JAL Sunlight Co., Ltd., a special subsidiary, as of June 1 of the following fiscal year
*4 Calculation based on data of Japan Airlines Health Insurance Association0• Account closing date

March 31

• Ordinary General Meeting of ShareholdersJune each year

• Date of Finalizing Shareholders Eligible to Exercise Voting Rights
March 31at the Ordinary General Meeting of Shareholders• Date of record for dividend

September 30 and March 31• Shareholder Registry Administrator
Mitsubishi UFJ Trust and Banking Corporation
September 30 and March 31• Date of record for dividend • Shareholder Registry Administrator
Mitsubishi UFJ Trust and Banking Corporation• Contact
Stock Transfer Agency Department
Mitsubishi UFJ Trust and Banking Corporation
1-1, Nikko-cho, Fuchu-shi, Tokyo, Japan
Mailing address: ShinTokyo Post Office Post-office box no. 29
Phone: 0120-232-711 (toll free (Only within Japan))
Open: 9:00 am to 5:00 pm except Sat, Sun and public holidays(Japan time)
Website: www.tr.mufg.jp/daikou/ (only in Japanese)

Shareholder

所有株式数
（株）

議決権比率
（％）
8.18

Custody Bank of Japan, Ltd.
(Trust account)

16,796,100

3.84

MSCO CUSTOMER SECURITIES

9,178,003

2.10

Kyocera Corporation

7,638,400

1.74

Custody Bank of Japan, Ltd.
(Trust account 5)

7,073,400

1.61

Custody Bank of Japan, Ltd.
(Trust account 9)6,608,200

1.51

Custody Bank of Japan, Ltd.
(Trust account 6)

6,271,100

1.43

Custody Bank of Japan, Ltd.
(Trust account 1)

5,639,000

1.29

The Articles of Incorporation lay down the following provision

Daiwa Securities Group Inc.

5,000,000

1.14

Article 12. Limitation on listing or recording of Citizens of Foreign Countries and Other
Persons in Register of Shareholders and Register of Beneficial Shareholders 12.1
If the Company receives from a person, who falls into one of the categories listed
in the items below, a request for listing or recording his or her name and addressin the register of shareholders (including the register of beneficial shareholders;hereinafter the same), and if the acceptance of such request causes the total voting
rights owned by persons, who fall into one of the categories listed in the items
below, to represent one-third or more of the Company’s total voting rights, theCompany shall refuse such listing or recording.
(1) A person who does not have Japanese citizenship(2) A foreign country, foreign public body or similar entity(3) A corporation or other organization established under foreign laws and regulations
2. When the Company intends to list or record all shares held by any of theshareholders listed in the items of the following paragraph, upon notification froma book-entry institution in accordance with Article 151. Paragraph (1) or (8) of the
Act on Book-Entry Transfer of Company Bonds, Shares, etc., and thereby the total
number of voting rights held by such persons listed in the items of the preceding
paragraph will account for more than a third of the Company’s voting rights, theCompany shall list or record such shareholders in the register of shareholders inaccordance with measures provided for in the Ordinance of the Ministry of Land,
Infrastructure, Transport and Tourism to list or record only a part of the shares sothat the total number of voting rights held by such shareholders in the items of thepreceding paragraph accounts for less than a third of the Company’s voting rights.

Custody Bank of Japan, Ltd.
(Trust account 2)

4,485,800

1.02

104,445,803

23.9• Method of official announcement
Electronic public notice at:
URL www.jal.com/en/corporate/publicnotices/ (only in Japanese)
Provided, however, that if the electronic notice cannot be made due
to an accident or any unavoidable reason, the public notice shall be
published in the Nihon Keizai Shimbun.
• Limitation on listing or recording of Citizens of Foreign
Countries and Other Persons in Register of Shareholders andRegister of Beneficial Shareholders

Trading volume(Right axis)(Million shares)
250

4,000

Company Profile
Corporate NameJapan Airlines Co., Ltd.

Headquarters

Nomura Real Estate Bldg., 2-4-11
Higashi-Shinagawa, Shinagawa-ku, Tokyo
140-8637, Japan
Phone: +81 (0)3-5460-3121
Website: www.jal.com/en

Established

August 1, 1951

Representative
Director,
Yuji Akasaka
Executive President
Capital273,200 million yen

Employees

Consolidated Employees 36,060 people

200

150

3,000

2,000

100

1,000

50

0

Data Book

Share price(Left axis)

(Yen)
5,000

Medium Term Management Plan

35,755,800• Transition of Share Price and Trading Volume (AF8)

Employees 13,787 people
Capital andPaid-in Capital

539,541 million yen

Businesses

1. S cheduled and non-scheduled airtransport services
2. Aerial work services
3. Other related business(Amount is rounded down to the nearest million yen)

0
April
2017

JAL REPORT 2021

• Major Shareholders

The Master Trust Bank of Japan, Ltd.
(Trust account)concerning the Civil Aeronautics Act, Article 120-2.

149

shares of treasury stock were retired on November 8, 2019, and the number of issued
株発行を行い、発行済株式数が90,869千株増加しています。
shares was reduced
by 5,818,000.
2020年12月23日に第三者割当に
Based on the result of a decision by the Board of Directors
on October 31, 2019, 6,067,000*※2020年11月６日開催の取締役会決議に基づき、
shares of treasury stock発行済株式数が9,130千株増加しています。
were retired on March 13, 2020, and the number of issued shares
よる新株発行を行い、was reduced by 6,067,000.

The JAL Group Value Creation Story30

persons

9201
100 shares• Number of Shares Per Unit• Total number of shares to be issued 750 million(Common stock) (700 million)(Class 1 Preferred stock) (12.5 million)(Class 2 Preferred stock) (12.5 million)(Class 3 Preferred stock) (12.5 million)(Class 4 Preferred stock) (12.5 million)• Outstanding Issued Shares
Common stock 437,143,500 (Number of shares per unit: 100)
Number of Shareholders 389,848*T he total number of shares issued includes 136,217 shares of treasury stock.
 ased on the result of a decision by the Board of Directors on October 23, 2019, 5,818,000*B※2020年11月６日開催の取締役会決議に基づき、2020年11月25日に公募による新Foreword%

Number of female directors on board*2
Number of female directors(director, Executive Officer)*2
Ratio of female directors(director, Executive Officer)*2
Attendance ratio of External Directors andAuditors to Board of Directors*2
Risk Management

Ratio of independent directors*2(as of March 31, 2021)

April
2018

April
2019

April
2020

April
2021

JAL REPORT 2021

150