CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY
Annual Report 2020
For the Year Ended March 31, 2020

CENTRAL JAPAN RAILWAY COMPANYCENTRAL JAPAN RAILWAY COMPANY
Annual Report 2020

INDEX
3
4
6

Management Philosophy

Management Philosophy
JR Central’s Operating Revenues
Composition
Market Area Characteristics andTransportation Capacity

Contribute to
the developmentof Japan’s maintransportationartery and social
infrastructure

Business Strategy

8
10
12
14
17
18

JR Central’s History
Top Message
Overview of Business Strategy
Policy on Business Strategy
Surrounding External Environment (Risks)
Initiatives Based on Business Strategy

Special Feature

22
26
29

The Chuo Shinkansen Project Using theSuperconducting Maglev System
Technological Development to Support JR
Central’s Growth
Countermeasures against COVID-19

ESG Activity Report

30
38
56
62

70
100

SafetySocialEnvironment
Governance

Financial Information
Corporate Data

Editorial policy

JR Central strives to enhance dialogue with many stakeholders,
including shareholders and investors, in order to contributeto sustainable growth and increase corporate value over the
medium to long term. The objective of this report is to deepen
readers’understanding of our company’s financial informationand non-financial information such as business strategies and ESG
information. This report is edited with reference to the“International<IR> 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. For ESG
information, we refer to the“GRI Standrds”issued by the Global
Reporting Initiative.

[Remarks regarding forecasts, etc.]
Future plans, forecast figures, etc., in this report are an outlook
based on the information that is currently available to JR Central
and may contain risks and uncertainty. Examples of potential
risks and uncertainty in clude economic trends, businessenvironment developments, consumption trends, the competition
situation for JR Central and subsidiaries, and changes in relevantlaws and legal provisions. This report is compiled based on
information available as of the end of June 2020 in principle.
●In this report, figures of financial information are truncated,while statistical data and all percentages are rounded.
●FY2019 signifies the fiscal year ended March 31, 2020.

2

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Japan’s Main Transportation Artery
JR Central’s mission is to undertake high-speed,large capacity passenger transport between Tokyo,
Nagoya, and Osaka.“Japan’s main transportationartery”refers to this passenger transport. Since theartery runs through this area of Japan, which plays
an important role as the center of the country’seconomy and culture, it is possible that stagnancy
in the main transportation artery will cause Japan’seconomic and societal movement in general to alsostagnate. JR Central will continue to carry out its
mission of managing Japan’s main transportationartery today and in the future through operation of
the Tokaido Shinkansen and the Chuo Shinkansen.

So c i al I n fr as t r u c t u r e
On a broader perspective, JR Central also
undertakes the mission of supporting the social
infrastructure. That is, along with the managementof Japan’s main artery, we take a locally oriented
approach in operating a network of conventionallines in the Tokai Region, centered on the Nagoya
and Shizuoka areas, and manage affiliated businessfocused on the local communities, thereby
supporting the people in these areas. We will remaincommitted to operating conventional lines while
managing and further enhancing affiliated businesses.
CENTRAL JAPAN RAILWAY COMPANY Annual Report 20203

Real Estate

19.0

CENTRAL JAPAN RAILWAY COMPANY
Annual Report 2020

Other

13.5

billion yen

7.4

billion yen

Operating Revenues Operating Income
Transportation

FY20191,431.2

617.6

Merchandise
and Other

263.2

7.4

(Consolidated)

Real Estate

79.9
272.2
1,844.6

19.0
13.5
656.1

Merchandise and Other

JR Central’s Operating
Revenues Composition(billion yen)billion yen

Operating Income

656.1
billion yen

OtherTransportation

617.6

Total

billion yen

Merchandise and Other

Transportation

Includes a department store in JR Central Towers, retailsales in trains, and others.

14

Composition of Operating Revenues

Real Estate

JR Tokai Takashimaya Co., Ltd.
JR-CENTRAL PASSENGERS Co., Ltd.
Tokai Kiosk Company
JR Tokai Corporation%

Includes real estate leasing business, such as stationbuilding leasing, and real estate in lots.

3

Composition of Operating Revenues

77

Includes the Tokaido Shinkansen and conventional railway operations in the Tokai area, bus operations, and others.

Composition of
Operating Revenues

Major Affiliated Companies

Central Japan Railway Company
JR Tokai Bus Company

Conventional Lines

8

%

%

Other

FY2019Transportation
Revenues(Non-Consolidated)

1,365.6
billion yen

%

92

%

Major Affiliated Companies
Central Japan Railway Company
JR CENTRAL BUILDING CO., LTD.
JR Tokai Real Estate Co., Ltd.
Shin-Yokohama Station Development Co., Ltd.
Tokyo Station Development Co., Ltd.
Nagoya Station Area Development Corporation
JR Development and Management
Corporation of Kansai

Includes hotels in our main stations, travel, advertising, rolling stock production,and construction which are not included in other repotable segments.

7

Composition of Operating Revenues

Tokaido Shinkansen

Major Affiliated Companies%

Major Affiliated Companies
JR Tokai Hotels Co., Ltd.
JR Tokai Tours
JR TOKAI AGENCY CO., LTD.
NIPPON SHARYO, LTD.
JR TOKAI CONSTRUCTION Co., Ltd.
CHUO LINEN SUPPLY Co., Ltd.
The Japan Mechanised Works andMaintenance of Way Co., Ltd.
Tokai Rolling Stock & Machinery Co., Ltd.

Notes 1.Operating revenues of each segment includes the amount of sales to other repotable segments as well as the amount of sales to external customers 2.Consolidated operating revenues composition is based on revenue from external customers
3.Consolidated total operating income 656.1 billion yen includes the reconciliations amount of △1.3 billion yen for segment profit which is the elimination of intersegment transactions

4

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 20205

Operating Area
CENTRAL JAPAN RAILWAY COMPANY
Annual Report 2020

Hiroshima

Market Area
Characteristics andTransportation Capacity
Japan’
s population and economic activity
are concentrated in our market area
covering the Tokyo Metropolitan area, theNagoya region, and the Osaka region
Percentages of our market area in Japan as a whole

当社マーケットエリア

Hakata1,174.9 km

JR Central’s market area equals the
economic size of major countries

Changes in daily transportation capacity(Comparison between the Tokaido Shinkansen
and airline transportation services operating
between the Tokyo Metropolitan area and the
Osaka region)（Ten Thousand seats/day）40［As ofJanuary
2020］

Railway

Airlines

JR-CENTRALApproximately

*1

100

Tokyo

Population

12※3
Tokyo area - Okayama

Canada[FY2016]Australia(Nominal GDP)

10100（%）【Source】
JR Central’s market area is calculated taking the following prefectures into accountTokyo, Kanagawa, Chiba, Saitama, Ibaraki, Shizuoka, Yamanashi, Nagano,
Aichi, Mie, Gifu, Shiga, Osaka, Kyoto, Hyogo, Nara
Population: Ministry of Internal Affairs and Communications“Population, Demographics andNumber of Households Derived from Basic Resident Registration”
Total production by prefecture: Cabinet Office“Report on Prefectural Accounts”

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

0

70

%

30%

Tokyo area - Hiroshima

68

32%

%

(16 thousand passengers/day)*2

Approximately

South Korea

50

15%

(9 thousand passengers/day)BrazilPrefectural
GDP

Okayama Hiroshima Hakata(150 thousand
passengers/day)

Italy
%

Osaka

Tokyo area Osaka area*2

20

India

0

%

times
that of airlines

France

65.4

85

About

UK
［As of January 1,
2020］

Nagoya(81 thousand
passengers/day)

30

JR Central’s market area%

JR WestTokyo area*2 Nagoya area*2

Japan

60.9

Airlines%

1,212

Germany

6

Tokaido Shinkansen

Market Share *1(against Airlines)

370,000seats

2,036

China

JR Central has established an
overwhelming market share within its
market area

Within this market, we provide
overwhelming transportation capacity thatis incomparable to other modes

Comparison with GDP of each country

USA

Area

Tokaido Shinkansen

552.6 km（Trillion yen）%

Representing a powerful presencein the inter-city transportation
market, one that is unrivaled allover the world.

Shin-Osaka

366.0 km

その他

23.7

OkayamaTokyo

Nagoya

200

400

600

【Source】
United Nations database, Cabinet Office“Report on Prefectural Accounts”

0*1

30,000seats

10%

Tokyo area - Fukuoka

90%(30 thousand passengers/day)’07.3 ’08.3 ’09.3 ’10.3 ’11.3 ’12.3 ’13.3 ’14.3 ‘15.3 ’16.3 ’17.3 ’18.3 ’19.3 ’20.3

 okaido Shinkansen: The number of passenger seats provided
T(including extra train services) on through-service“Nozomi”and“Hikari”lines operating between Tokyo Station and Shin-Osaka
Station in each respective fiscal year.
*2 Airlines: Calculated by JR Central based on information pertaining
to specified Japanese air carriers (Ministry of Land, Infrastructure,
Transport and Tourism) for FY2006 to FY2019.

*1*2

Market share is calculated by JR Central based on the Interprefectural data of the inter-Regional Passenger Mobility Survey,
published by the Ministry of Land, infrastructure, Transport andTourism for FY2017.
Tokyo area: Tokyo, Kanagawa, Chiba, Saitama, Ibaraki
Nagoya area: Aichi, Gifu, Mie
Osaka area: Osaka, Kyoto, Hyogo, Nara

CENTRAL JAPAN RAILWAY COMPANY Annual Report 20207

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

JR Central’s History

Business Strategy

Increase of the maximum speed to 285 km/h

JR Central’s History●Maximum speed of all Tokaido Shinkansen

trains increases to 270 km/h

● Shift to train scheduled centered on“Nozomi”

1,188.3

1,215.3

1,240.6

1,384.0371.0“Express Reservation”service expands to the total
length of Tokaido and Sanyo Shinkansen lines

403.7

370.4

114.3
66.9
90.3

2000

JR Central takes over theTokaido Shinkansen facilities

56.4

16.5
92.3

26.2

25.1

32.6

94.3

96.3

98.3

37.6

42.0

2000.3

02.3

Established by the Privatization and breakup of JNR

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

08.3

Consistently Improve Transport Services on the Tokaido Shinkansen

10.3

12.3

14.3

Operating income (billion yen)

16.3

18.3

20.3（Year）

Net income attributable to owners of the parent (billion yen)

Establishment of a Solid Management Basebetween Tokyo and Osaka has now been
reduced to 2 hours and 21 minutes. With thetimetable revision of March 2020, we realized
the “12 Nozomi Timetable” that runs up to 12
services (1 every 5 minutes on average) per hour
during busy hours. In July, we began commercial
operation of the new Shinkansen rolling stock
N7 0 0 S, which incorporates the results of ouraccumulated technological development, and weare making use of the Tokaido Shinkansen evenmore convenient.

FY1987FY201960

17

SubstantiallyreducedPassenger volume

27.9

45.8

1.6 x

Number of services

231

378

1.6 x

Maximum speed

220

Railway operation accidents(incidents per year)

Operatingresults

Photographs from the time of privatization“Hida #1”departure ceremony (April 1, 1987, at Nagoya Station)

132.7
91.7

Operating revenues (billion yen)With the inauguration of the Tokaido Shinkansen in
1964, the time required to travel between Tokyo andOsaka was shortened to 3 hours and 10 minutes (4hours at the time of inauguration) from 6 hours and
30 minutes. Furthermore, with the introduction of the“Nozomi”in 1992, that time was shortened to 2 hours
and 30 minutes.
In October 2003, the investment in rolling stock andground facilities that we had continuously engaged
in for approximately 15 years culminated with theupgrading of the maximum speed of all trains to 270
km/h and the drastic timetable revision that resulted ina maximum of seven Nozomi services operating eachhour.
With the introduction of the “10 Nozomi Timetable(operating up to 10 Nozomi services in both
directions)” in 2014, and the increase in maximum
speed to 285 km/h in 2015, the shortest travel time

200

TokaidoShinkansen

JR Central was born on April 1, 1987, following the privatization andbreakup of Japan National Railways (JNR).
JNR, the predecessor of JR Central, took over Japan’s railway business,
which was then a national enterprise, as a public enterprise in 1949. JNR
supported the development of Japan as a means of transportation for theJapanese people, but due to poor management of the public corporation,
it incurred debts of over 30 trillion yen, including the creation of newlines with unclear management responsibilities and disregard forprofitability. At the same time, it fell into a serious state of being unable
to respond quickly to global trends.
Under these circumstances, the“JNR reform”was an effort to review
the role of the railway business operated by JNR for the future. In 1987,
as part of administrative reforms, the operations of JNR were passed
on to 11 succeeding corporations with the aim of carrying out soundcorporate management by privatizing and breaking up the transportation
operations of JNR, rebuilding
the railway business as ameans of transportation
for the people, and further
developing it for the future.
Since the privatization andbreakup of JNR, JR Central
has steadily progressed as a
private company, inheriting
the public and social missionsof JNR.

06.3

400

255.6

159.7

72.2

04.3

397.8

337.4

293.4

122.4

JR Central Towers are opened* Figures for the period between 88.3 and 89.3 are non-consolidated figures of JR Central as the period is before the announcement of consolidated financial results.

8

395.5

372.5

2008

1987

88.3

494.6

434.4

344.4

325.6

1991

656.1 600

578.6

JR Central made NIPPON SHARYO, LTD.
a consolidated subsidiary

Central Japan Railway Company(JR Central) is established

662.0

Tokaido Shinkansen

1,221.6

288.4

1987

The“smartEX”service starts for the Tokaido
Shinkansen and the Sanyo ShinkansenT he“EX-IC”service starts for the“Express Reservation”is launched
for Tokaido Shinkansen

383.7

800

2017

2006

394.0

71.5

1,508.3

1,486.6

2008

2001

874.6

1,844.6

1,822.0

1,652.5

Put N700A into commercial service

1,467.6

1,052.3

800

Put N700S into
commercial service

1,738.4

2013

1,559.4
1,366.9“12 Nozomi Timetable”“10 Nozomi Timetable”●Shinagawa station is opened

1,278.3

20202014 年

2003

Since its establishment, the JR Central Group has worked to improve its transportation
services and increase revenues placing top priority on safety, while at the same time working
to ensure operational efficiency and significantly strengthen its management base. We willcontinue to maintain sound management and stable dividends for the future and strive todevelop our business.

1,000

2020

2015

(10,000 people per day)(trains per day)(km/h)

285+65km/h

1,844.6

2.1 x
9.2 x

Operating revenues (billion yen)

874.6

*2

Operating income (billion yen)

71.5

*2

656.1

16.5

*2

397.8

5.5

*3

1.8

52.6

*4

636.6

Net income attributable toowners of the parent (billion yen)
Long-term debt (trillion yen)

Operating Revenues of Consolidated
Subsidiaries (billion yen)*1

Remarks

24.1 x*5-3.6 trillion yen
12.1 x*1Simple aggregation *2 Non-consolidated figures *3 Figures for FY1991 *4 Figures for FY1989 *5 Excluding long-term debt for the Chuo Shinkansen

Series 0

Series 100

Series 300

Series 700

Series N700

N700A

N700S

Transition of
Shinkansenrolling stock
CENTRAL JAPAN RAILWAY COMPANY Annual Report 20209Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Top Message

Business Strategy

Top Message

Respond to the trust and mandate of all stakeholders and pursue
the mission of “Contribute to the development of Japan’s maintransportation artery and social infrastructure.”mainstay Tokaido Shinkansen, and worked to reduce costs andimprove efficiency while placing top priority on safety. As a result,revenues and profits have increased and, based on this, we achieved
a positive cycle of reducing our long-term debt, enhancing safety andservices from a long-term perspective, and promoting investment intechnological development, which has led to a significant strengtheningof our management base. As a result of these efforts to strengthen ourmanagement base, the current Chuo Shinkansen Project has become
possible.

President and Representative Director

Shin Kaneko

Basic Management Policy
Based on its management philosophy of “Contribute to thedevelopment of Japan’s main transportation artery and social
infrastructure,”JR Central’s basic management policy is to integrally
maintain and develop the Tokaido Shinkansen, which serves as themain transportation artery of Japan, and the conventional railway
networks in the Tokai region, while developing highly synergistic
affiliated businesses with railway business in collaboration with Group
companies.
In order to carry out business activities centered on the railway
business, the“ability to work safely,”“ability to provide better service,”
and“ability to work efficiently”of each division are indispensable. I
believe that it is by constantly strengthening and demonstrating thesethree abilities that we have achieved significant results in the past 30
years or so since the establishment of the company.
First of all, ensuring safe and reliable transportation is the basis
for all our businesses and is the starting point for railway business.
Therefore, we have consistently given top priority to it. In fact,
investment for safety represents approximately 70% of our annual
capital investment, excluding the Chuo Shinkansen, and has amounted
to about 3.8 trillion yen since the foundation of our company. We arealso working tirelessly to improve the skills and safety awareness of
our employees through practical education and training and largescale recovery training, etc. in preparation for emergency situations. In
addition, we are working on safety as our main theme in technologicaldevelopment. As a result, since the opening of the Tokaido Shinkansen,
there have been no train accidents resulting in fatalities or injuries ofpassengers on board, and I believe that trust in the safety of the JR

10

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Central Group has greatly enhanced.
On the service front, with respect to our mainstay Tokaido
Shinkansen, we have focused on the safety and punctuality, as well
as fast, frequent, and comfortable services. Specifically, throughcontinuous capital investment for“improving our transportation
services”centered on“Nozomi”service, such as the launching of new
rolling stock models and renovating Shin-Osaka Station, the maximum
speed has increased from 220 km/h at the time of the company’sestablishment to 285 km/h, and the number of services per day has
increased by approximately 60% from the time the company wasestablished. In March 2020, we achieved a timetable that allows therunning of 12“Nozomi”trains per hour, and in July we launched newrolling stock model“N700S”into commercial operation to continuously
improve service levels. Furthermore, we have actively carried out sales
and marketing initiatives such as promoting online reservation andticketless boarding services and, as a result, the passenger volume of
the Tokaido Shinkansen has increased approximately 1.6 times fromthe start of the company. In addition to launching new rolling stock andincreasing the frequency of services in conventional lines as well, we
have expanded our revenue base by developing affiliated businesses
centered on areas where synergies with our railway business can be
expected, as exemplified by the JR Central Towers and JR Gate Tower
at Nagoya Station.
Furthermore, we have refused to be satifsfied with just maintaining
the status quo and have continued to be creative in finding ways toreduce costs and improve efficiency while increasing revenues byimproving safety and service quality.
In this way, we have improved our services centering on our

In recent years, there has been a growing demand for “ESG
management”in corporate management, and we believe that ourcompany’s business activities have truly embodied the concept of“ESG
management.”JR Central’s management philosophy is“Contributeto the development of Japan’s main transportation artery and social
infrastructure.”To achieve this goal, we have worked to establish a
corporate culture that places the highest priority on safety, and haveensured the soundness, efficiency, and transparency of management
while aiming for long-term corporate development. By doing so,
we have engaged in business activities under solid governance that
increases the trust of all stakeholders. In addition to contributing to
the realization of a more livable society by thoroughly refining safe,
punctual, and comfortable railway transportation services for theTokaido Shinkansen, which is the core of our business and the maintransportation artery of Japan, as well as conventional lines in the
Tokai region, we have been constantly working to further improvethe environmental superiority of railways by incorporating the latest
technologies, in addition to promoting the use of railway transportation,
which has high environmental superiority. The results of our company’sbusiness activities are linked to the achievement of the“sustainable
development”that the SDGs aim to achieve through the constructionof safe and resilient infrastructure, promotion of innovation, andmitigation of the effects of climate change. Furthermore, from theperspective of promoting gender equality and rewarding employment,
we are making daily efforts to achieve the SDGs.

Toward Further Progress in the Future
As I mentioned earlier, the Chuo Shinkansen Project that we are
currently working on will be implemented through the use of theSuperconducting Maglev System developed by our company, assumingthat our company, a private company, will carry out the project at its
own expense as a drastic measure against the need for large-scalerenovation of the Tokaido Shinkansen, which has surpassed its 50th
anniversary, and major disasters. Through this project, our company
will manage the Tokaido Shinkansen and the Chuo Shinkansen in
an integrated manner. For example, by shifting users of the Tokaido
Shinkansen“Nozomi”to the Chuo Shinkansen, the number of“Hikari”
and“Kodama”services can be increased on the Tokaido Shinkansen.
We hope to construct the most desirable transportation system as
a whole by combining the two high-speed railways. By constructing
the bypass, we will be able to reduce management risks, stabilize ouroperations, and continue to forcefully fulfill our company’s mission to“Contribute to the development of Japan’s main transportation arteryand social infrastructure,”which is our management philosophy. In
addition, we believe that the opening of the Chuo Shinkansen will havea major impact on the Japanese economy and on people’s lifestyles.
The government has also proposed the“Super Mega Region”concept,

and hopes are high that the opening of the Chuo Shinkansen will
have the same great effect as the opening of the Tokaido Shinkansen,
realizing the integration of the three major cities of Tokyo, Nagoya, andOsaka. We will continue to make every effort to carry out the Chuo
Shinkansen Project, while placing importance on safety in construction,
environmental protection, and cooperation with local communities,
with the aim of opening the line as soon as possible.

Realize Our Management Philosophy at a
Higher Level
After February 2020, due to the outbreak of COVID-19, the numberof people using trains has significantly decreased. For the time being,
we must be prepared to face a difficult business environment, but
our Group will continue to fulfill its role as a highly public social
infrastructure while taking various infection prevention measures toensure that customers can continue to use our trains with peace ofmind. In addition, the effects of this infection may lead to changes inthe social environment, such as the spread of telework and the use of
online meetings, but the importance of face-to-face meetings between
people will remain unchanged. Even as the use of ICT advances, wewill continue to provide comfortable and convenient services from thestandpoint of our role in facilitating face-to-face communications thatare based on actual visits.
Our Group’s mission remains unwavering. We will continue to refine
the safe, punctual, fast, frequent, and comfortable characteristicsof the Tokaido Shinkansen, which forms the main transportationartery of Japan. We will also continue to strengthen the conventionallines in the Tokai region that form the network with the Tokaido
Shinkansen, as well as affiliated businesses that can be expected togenerate synergies with the railway business. In order to realize thismission even more forcefully in the future, we will proceed with theconstruction of the Chuo Shinkansen. Based on this business strategy,
we have a sense of mission as an important infrastructure company
that supports the Japanese economy and Japanese people’s lives, andwe will always return to our management philosophy of“Contributeto the development of Japan’s main transportation artery and social
infrastructure.”We will continue to take on challenges to achieve
this at a higher level, firmly maintain sound management and stabledividends, increase the trust of all stakeholders including shareholders,customers, employees and business partners, and achieve sustainablegrowth.
We look forward to your continued support and understanding of
our Group’s business.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202011

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Overview of Business Strategy

Business Strategy

Overview of Business Strategy
Management
Philosophy

Contribute to the development of Japan’s maintransportation artery and social infrastructure

Customers
Safe and comfortable
service for everyone● Innovative reduction of
travel time by the Chuo
Shinkansen

Business Activity● 

Ability to work safely

Ability to provide better service

Ability to work efficiently at low cost

JR Central’s strength

Shareholders
S ustained increase of
cash flows● Long-termstabledividends●’ s Main Transportation Artery
Japan

Tokaido Shinkansen

Chuo Shinkansen

Lifeline of JR Central’soperations

Drastic enhancement of
main transportation artery

Safe, Punctual, Fast,
Frequent, Environmentally
Fesibile, Comfortable

Leap to future growth

Employees
Long-term stable
employment
environment● Active and rewarding
workplace●

Outcome

Synergy

Network function

Business partners
Social Inf rastru cture

Building long-term,
stable, fair, andequitable business
relationships●Conventional Lines

Affiliated Businesses

Synergy

Station buildings,
department stores,
hotels, etc.

Nagoya and Shizuoka
regions

Local communities
Expansion of theJapanese economy● Revitalization of local
communities● 
Building a resilient
society● 

Governance
Safety-first corporate cultureSound, efficient, and transparent management from a longterm perspective to realize our management philosophy

Management that increases thetrust of all stakeholders

Global environment
Conservation of the
global environment by
expanding the use ofenvironmentally friendly
railways● 

Surrounding External Environment (Risks)● Earthquake risk ● Declining birthrate and aging population● Intensification of natural disasters● Changes in social needs● Epidemics of infection*Refer to page 17 for details.

12

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202013

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Policy on
Business Strategy

Business Strategy

Policy on Business Strategy

S▶

Safety30 〜P.

SafetySocialEnvironment

Governance

Safety is the foundation of all our businessIn the railway business, securing safe and reliable transportationmust always be the top priority. Regardless of past achievements,
if we were to cause a major accident, the trust placed in the
Company would be lost in an instant, and the Company’s veryexistence would be put in danger. With this frame of mind,
the Company has been concentrating its greatest energy into
safety assurance from both hardware and software perspectives
ever since its establishment. The majority of our annual capital
investment is related to safety, and we have invested a total ofS▶

Social38 〜P.

more than 3.8 trillion yen in safety since our establishment. We
also emphasize safety in technological development and staff
training. As a result, since the Tokaido Shinkansen started service,
there have been no train accidents that have killed or injured
passengers.
There is no end to our efforts for safety. The Company’s toppriority management issue has been and will continue to be theassurance of safe and reliable transportation, and we will continue
our utmost efforts to achieve this goal.

SafetySocialEnvironment

Governance

Mission to serve as Japan’s main transportation artery

Based on its management philosophy of“Contribute to the developmentof Japan’s main transportation artery and social infrastructure,”JR Central
places the highest priority on ensuring safe and reliable transportation in
its railway business, and this is the basic premise for all of our business
operations. On top of that, we are constantly refining the convenience ofthe main transportation artery of the Tokaido Shinkansen, which connects
Tokyo, Nagoya, and Osaka, to expand revenues by increasing thenumber of customers who use our services. At the same time, we havecreated a positive cycle in which we invest to ensure safety and enhance

our services based on our efforts to secure profits through efficientmanagement and being creative in all aspects of business execution.
Through the accumulation of these measures, we have significantly
strengthened our operating foundation, thereby maintaining stabledividends and creating a long-term stable employment environment.
We will strive not only to contribute to the sustainable developmentof society but also to increase the trust of all stakeholders, including
customers, shareholders, employees, and business partners, to promote
the sustainable development of our company.

Since its inauguration in 1964, the Tokaido Shinkansen has supported
the growth of the Japanese economy for more than half a century, withapproximately 6.6 billion people using it as the main transportation artery
connecting Tokyo, Nagoya, and Osaka, the three largest metropolitan
areas in Japan and the centers of society and culture. This region isabout 20% the size of Japan in terms of area, but it is an area where thepopulation is concentrated and produces more than 60% of GDP. The
Tokaido Shinkansen is an essential infrastructure for Japan’s economy andsociety as a whole, as it plays a role in providing transportation services,which are the basic elements of economic activities and social life, tocustomers with diverse needs such as business trips, leisure, and inbounddemand.
To fulfill its mission of maintaining and developing this maintransportation artery, JR Central has consistently strived to improve
its transport services. We have invested our management resources

continuously and effectively for many years in order to constantly
refine not only safety and punctuality, but also fast, frequent, highcapacity, environmentally feasible, and comfortable characteristics.
As a result, since its inception, the Tokaido Shinkansen has achieved
zero train accidents resulting in the death or injury of passengers, anaverage delay of 0.2 minutes, a maximum speed of 285 km/h, and378 trains per day, representing a powerful presence unrivaled in the
global inter-city transportation market.
Thanks to the high competitiveness of the Tokaido Shinkansen,
which was built up through these initiatives, the number ofpassengers transported per day in FY2019 reached 458,000,
accounting for approximately 90% of our company’s non-consolidated
revenues. This cash flow has enabled us to make capital investments
necessary for further growth and pay dividends to shareholders.

Mission as a social infrastructure
Business Strategy and ESG Management
JR Central sets the highest priority on ensuring safe andreliable transportation under its management philosophy of“Contribute to the development of Japan’s main transportationartery and social infrastructure.” JR Central’s mission is tointegrally maintain and develop the Tokaido Shinkansen,
which serves as Japan’s main transportation artery, andthe conventional line network in the Tokai region throughcontinuous efforts, such as providing services that are preferredby customers and streamlining of work, as well as to operate
the “three generations of railways” by constructing the Chuo
Shinkansen to make Japan’s main transportation artery a dual
system. Our fundamental policy is to continue to stably execute
this mission over the long term, including the development ofaffiliated businesses.
The railway business, which is the core business of the JR
Central Group, requires long-term massive capital investment
and technological development with considerable lead times.
Due to such a business structure, we believe it is vital to manage
our railway business based on a long-term outlook rather thanpursuing only short-term profitability. Based on this policy, we are

14

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

promoting mid-to-long term projects in a well-planned manner
while simultaneously providing high quality services in our daily
railway operations and aiming to enhance our management base.
At our company, which focuses on the railway business, we
also believe that refining our business itself is directly linked
to ESG-focused management. Railway transportation has theadvantage of higher energy efficiency and lower impact on the
global environment compared to other transportation modes [E].
We believe that supporting the main transportation artery andregional transportation as social infrastructure will contribute to
the sustainable development of the Japanese economy and local
communities, with securing safe and reliable transportation as
the basic premise [S]. In addition, by conducting such corporate
activities under appropriate governance [G], we believe that we
can secure stable profits, return profits to shareholders, build
long-term stable relationships with employees and business
partners, increase trust from all stakeholders, and lead tosustainable growth as a company.

On a broader perspective, JR Central also undertakes themission of supporting the social infrastructure. That is, in an
integrated manner with the management of Japan’s maintransportation artery, we take a locally oriented approach inoperating a network of conventional lines in the Tokai Region,
centered on the Nagoya and Shizuoka areas, and manage affiliatedbusiness focused on the local communities, thereby supporting thepeople in these areas.
The conventional railway lines operated by JR Central, covering
12 railway sections, are approximately 1,400 km in operating
kilometers, which is approximately 2.5 times the distance of theTokaido Shinkansen, and play a role as a means of transportation
for daily life, including commuting to work and school. In otherwords, they serve as the social infrastructure of the local
community. By combining and mutually complementing theseconventional lines with the Shinkansen line, our company has
provided services that are easy to use and worked to maintainits transportation network. We will continue to strive to provide
transportation services that are loved by the local community, andwe will continue to be creative to secure revenues and operate
our business efficiently.
We also need to expand our revenue base in order to maintainstable management in the future and further strengthen it. A stationthat attracts many people, including railway passengers, is not only
an important connecting point in the local community, but also an
important management resource for our company. By making themost of these management resources, the development of the office,commercial, hotel, and other businesses in good locations at stations
will enliven stations and expand the use of railways. On the other
hand, if railway use increases due to improvements in transportation
services, it will also contribute to increased sales in our company’s affiliated businesses developed at stations. The JR Central Towers
and JR Gate Tower at Nagoya Station, our company’s largest station,
are prime examples. For businesses that create such a positive cycle,
we are working together with Group companies to expand operating
revenues and profits mainly in areas where synergies with railways are
expected.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202015

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

Surrounding External
Environment (Risks)Business Strategy and ESG Management

E▶

Environment

56 〜

P.

Business Strategy
SafetySocialEnvironment

Governance

Responsibility for the global environment
Railways have the outstanding characteristic of being highly
energy efficient compared to other transportation modes andhaving minimal adverse impact on the global environment. JR
Central is directly reducing the load on the environment by further
improving the energy efficiency of its railway operations throughsuch measures as lowering power consumption in rolling stock.
Specifically, we are actively developing and introducing energyconserving rolling stock in an effort to further reduce the
Shinkansen’s energy consumption. When operating between Tokyoand Shin-Osaka at the highest speed of 285 km/h, the N700A typeconsumes 16% less energy than the previous Series 700 when bothare running at a highest speed of 270 km/h, achieving a remarkable
improvement in energy consumption while increasing speed. As aresult, the Energy Consumption unit of the Tokaido Shinkansen as ofthe end of FY2019 decreased approximately 33% from what it wasin FY1990. The N700S, which began commercial operation in July
2020, further reduced power consumption by 6%. Other initiatives

G▶

Governance

62 〜

P.

include the introduction of energy-conserving rolling stock on
con v e n ti on al l i n e s an d th e i mprov e me n t of e l e ctri c ity supply
efficiency on the Shinkansen.
JR Central also mitigates the load placed on the environment
across the entire Transportation section, brought about by having
as many passengers as possible opt to use railway services, which
has a smaller environmental impact compared to other modes oftransport. Railways account for 30% of passenger transport volume
in Japan, but only 7% of CO2 emissions. Compared with an airplane( B 7 7 7 - 2 0 0 ) , t h e T o k a i d o S h i n k a n s e n ( S e r i e s N 7 0 0 “ N o z o m i ”)
consumes approximately 1/8th of the amount of energy per seat
when traveling between Tokyo and Osaka, and discharges about
1/12th of the CO2 emissions. We will continue to improve ourtransportation services while contributing to global environmental
preservation as a corporate responsibility.

SafetySocialEnvironment

Governancedevelopment with considerable lead times, and we believe it is vitalto manage our business based on a long-term outlook rather thanpursuing short-term profitability.
JR Central will continue to work to establish a corporate
culture that places the highest priority on safety, and ensure thesoundness, efficiency, and transparency of management whileaiming for long-term corporate development. By doing so, we will
engage in business activities under solid governance that increases
the trust of all stakeholders.

16

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

■Changes in social needs

Chuo Shinkansen

Shinagawa▶

Increase in inbound travelers

Changes in the number of visitors to Japan(10,000 persons)
6,000

Nagoya

6,000

5,500

Seismic
intensity class

7
6 upper
6 lower
5 upper
5 lower
4

5,000

4,500

4,000

*Prepared by JR Central based on“Countermeasure against Nankai TroughLarge Earthquake (Final Report)”(May. 2013)

Japan is a major earthquake country. Strengthening infrastructure
is an urgent issue in the market area of JR Central, as theprobability of an earthquake with an epicenter directly under the
Tokyo metropolitan area occurring within 30 years is said to bearound 70%, and the probability of an earthquake occurring in the
Nankai Trough is said to be 70 to 80%, among other risks.

■Declining birthrate and aging population
Graph of future population trends in Japan as a whole and in
prefectures along railway lines
105

Japan

Nagoya area

Tokyo area

Osaka area

3,500

3,188
3,119
3,000

2,869

2,500

2,404
1,974

2,000

1,500

1,341

1,000

500

521

614 673733

835 835

1,036

861
679

836
622

100
0

AND COMMUNITIES” and “13. CLIMATE ACTION,” as well as “5.
GENDER EQUALITY” and “8. DECENT WORK AND ECONOMICGROWTH,”to which we can make a particular contribution throughthe value created by our business activities.

95

90

80

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2030
(Year)

Note: Values before 2019 are determined by the Japan National Tourism Organization
The value for 2030 is the target value in the“Tourism Vision to Support
the Future of Japan”
▶

85

2015

2020

2025

2030

2035

2040

Increasing demand for barrier-free access

2045*National Institute of Population and Social Security Research “Regional
Population Projections for Japan: 2015–2045 (2018)”■Intensification of natural disasters

Relationship with stakeholders
JR Central’s railway business is highly public and has a multifaceted
array of stakeholders, including customers, shareholders, employees,
business partners, and local communities. Therefore, we believe it isimportant to maintain a balance between our overall relationships
with our stakeholders, rather than focusing on just one facet. We
believe that improving the convenience of many users, contributing
to the economic and social development of the region and Japan,
securing stable profits, returning profits to shareholders, and building
long-term stable relationships with employees and business partners
will increase the trust of all stakeholders and lead to sustainablegrowth as a company. We will continue to consider the balance of
these multi-faceted stakeholders in our management from a longterm perspective.

■Earthquake risk
Distribution map of the estimated biggest seismic intensity of theEastern Nankai Trough Large Earthquake

Tokaido Shinkansen

Initiatives for SDGs
JR Central defines its role and social mission as the
management philosophy:“Contribute to the development ofJapan’
s main transportation artery and social infrastructure.” As
an important infrastructure company that supports the Japanese
economy and people’s lives, our company must always havepride and a sense of mission in the future, and realize thismanagement philosophy at a higher level. This will lead not only
to sustainable growth as a company, but also to the realization ofthe“sustainable society”as envisioned in the SDGs.
With regard to the 17 goals set out in the SDGs, our company
will mainly focus its energies on realizing “9. INDUSTRY,INNOVATION AND INFRASTRUCTURE,”“11. SUSTAINABLE CITIESJR Central strives to achieve sustainable growth as a corporation by accurately assessing theimpact of changes in the surrounding external environment (risks) on its business activities andreflecting the results in its business strategies as needed.

Shin-Osaka

Management based on solid governanceBecause ensuring safe and reliable transportation is an issue of
utmost importance in the railway business, we manage our businessbased on the principle of steadily implementing the necessary
measures to ensure the long-term stable operation of railways, suchas large-scale Shinkansen renovations and measures to prevent
derailments and deviations. We are also working on the Chuo
Shinkansen, a large-scale, long-term project that will further reduce
our company’s management risk, stabilize our management base,and secure the interests of all stakeholders, including shareholders.
As described above, the railway business operated by our company
requires long-term massive capital investment and technological

Surrounding External Environment (Risks)

Frequent localized heavy rains (torrential rain)

Stakeholders
Customers ●Safe and comfortable service for everyone ●Innovative reduction of travel time by the Chuo Shinkansen
Shareholders ●Sustained increase of cash ﬂows ●Long-term stable dividends

Large-opening movable platform fence at Shin-Osaka Station
Platform No. 26▶

Progress of ICT society/telework

Employees ●Long-term stable employment environment ●Active and rewarding workplace
Business partners ●Building long-term, stable, fair, and equitable business relationships
Local communities ●Expansion of the Japanese economy ●Revitalization of local communities ●Building a resilient society
Global environment ●Conservation of the global environment by expanding the use of environmentally friendly railways■Epidemic of infection⇒Refer to page 29 for information on measures to combat infections.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202017

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Initiatives Based on
Business Strategy

Business Strategy

Initiatives Based on Business Strategy

Improvement of transportation centered on“Nozomi”

Further Development of the Main Transportation Artery

We have worked to enhance our transportation services on
the Tokaido Shinkansen for many years. We put the Series 300“Nozomi”into operation in 1992 with a maximum speed of
270km/h, and then opened Shinagawa Station and replaced all
trains with the Series 300 trains in 2003, allowing us to shift toa Nozomi-centered timetable. This timetable also underwent
successive improvements to fulfill the needs of customers. Then, in
2015, the speed of the Tokaido Shinkansen increased for the firsttime in 23 years, reaching a top speed of 285km/h.
Furthermore, we completed the update to the N700A type* toallow all trains to run at the same highest speed of 285 km/h, andSince its establishment, JR Central has constantly refined not only safe andcomfortable characteristics of the Tokaido Shinkansen, which plays the rolecompetitiveness. In addition, we are promoting the construction of the Chuo
Shinkansen, which will make the main transportation artery a dual system,
as a drastic measure against the need for large-scale renovation and majordisasters of the Tokaido Shinkansen.

Tokaido Shinkansen

Punctual

accidents● No accidents resulting in fatalities or injuries ofpassengers on board since operations commenced● Improvement of safety awareness and skills throughhuman resources education and training● Continual investment in safety-related facilities

Fast

285

Frequent and HighCapacity

km/h

378

services

458,000

passengers

ー

Departure Reservation and settlement

StationReservation, payment and ticketing

Entrance

Entrance

1/12

Tokyo and Osaka is approximately 1/8th that of an aircraft● The CO2 emission rate for the same is around 1/12th

Comfortable● Wide open,

quiet space

As a front runner of high-speed railways, the Tokaido Shinkansen rollingstock is constantly being refined by pursuing high-speed, comfortable,
and energy savings, as well as safe and reliable transportation, and by
introducing cutting-edge technologies.
Since the establishment of the company, we have continued
development of Series 300, Series 700, Series N700, and the current
mainstay N700A. In July of this year, we began commercial operationof the new Shinkansen rolling stock N700S to replace the N700A type,
incorporating the results of our accumulated technological development.
This rolling stock has enhanced safety and stability by shortening thebraking distance in the event of an earthquake, higher emergency
response capability by installing a battery-based self-propelled system,⇒Refer to pages 26 to 28 for information on technological development.

enhanced comfort and convenience by installing a full-active damping
control system, and lower running costs by reducing power consumption.
By developing new technologies, we will continue to improvetransportation services on the
Tokaido Shinkansen, placing
top priority on ensuring safeand reliable transportation.

Note: Results for FY2019 (including extra trains)
Note: Results for FY2019● Number of seating available: 1,323 seats/train

Approx.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

minutes● Number of passengers per day: 458,000● The energy consumption amount per seat when traveling between

18

0.2

● Number of train services per day: 378

Note: Accurate as of the March 2020 timetable revision (arrival
time based on the fastest trains in service)

1/8

MovingLaunch of new N700S Shinkansen rolling stock

Note: Results for FY2019. Including delays
caused by natural disasters, etc.

● Between Tokyo and Shin-Osaka: 2 hours 21 minutes

Approx.

Workplace

Departure⇒Refer to page 39 for the main features of the N700S.

● Average delay time: 0.2 minutes / 1 train in service● Maximum speed: 285 km/h

Environmentallyfeasible

Shinkansen, unlike other competing transportation systems.

Poster of“smartEX”

Characteristics of the Tokaido Shinkansen

0⇒Refer to page 40 for information on the expansion of online reservation services.

Paper ticket Ticketless boarding

In addition to increasing the frequency of the Tokaido
Shinkansen, we are working to provide better services by
expanding online reservation and ticketless boarding services.
By expanding online reservation and ticketless boarding
services, customers can make reservations and pay in advance on
the Internet at a convenient time without having to stop by theticket counter at the station, and they can change the details of
their reservations as many times as they like until four minutes
before departure. You can also use your commuting-type IC card
to get on trains seamlessly from conventional lines. As a result, thewaiting time at the station
approaches zero, effectively
reducing travel time to thedestination.
This reduced total travel
time through the expansionof online reservation
service and the increasein frequency is a majoradvantage of the Tokaido

of Japan’s main artery transportation, in order to maintain and strengthen its

Safe

also finished improvements to equipment, among other upgrades.
As a result, we introduced the“12 Nozomi Timetable” in March
2020. With the“12 Nozomi Timetable,”the maximum number of“Nozomi”services per hour increased by 2 from 10 to 12 in either
direction, and “Nozomi” is now operated at an average intervalof 5 minutes during busy hours. Also, under the“12 Nozomi
Timetable,” all “Nozomi” services will travel between Tokyo andShin-Osaka within 2 hours 30 minutes. With this “12 Nozomi
Timetable,” we have increased the number of “Nozomi” services
during busy times to make the Tokaido Shinkansen even moreconvenient.

Expansion of online reservation service

punctual but also fast, frequent, high capacity, environmentally feasible, and⇒Refer to page 38 for information on improvement in transportation services.

N700S

Chuo Shinkansen
Chuo Shinkansen Project as a drastic measure tostrengthen the main transportation artery
We are promoting the Chuo Shinkansen Project using theSuperconducting Maglev System to continually carry out our missionof operating a high-speed railway linking the Tokyo Metropolitan area,⇒Refer to pages 22 to 25 for the Chuo Shinkansen Project.

Chukyo, and Kinki regions, which is the lifeline of our business, as wellas to ensure the future foundation of the company and stabilize its
management.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202019

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Initiatives Based on
Business Strategy

Maintenance and Development of Local Social Infrastructure

Providing Transportation Infrastructure That Is Easy for All People to Use
All Railway Lines

Based on relevant laws, such as the so-called Barrier-Free Act, JR
Central has been cooperating with governments and municipalities tojointly establish and improve rolling stock and facilities to enable allpassengers to use our services safely and with a sense of security. We aremaking efforts to respond appropriately to the various changing needsof society, such as eliminating uneven ground by installing elevators andother equipment at stations, installing multifunctional toilets, installing
guiding blocks for visually impaired people and braille blocks to prevent
them from falling off platforms, installing movable platform fences tofurther improve safety on platforms, and securing space for wheelchairsin trains cars. JR Central will continue to make every effort to ensure thatits stations and rolling stock are safe and easy to use for all passengers.
We also believe that providing overseas visitors with a chance to visit
the rich tourist attractions along our railway lines is an important issue
from the perspective of increasing railway revenues and revitalizing

Conventional Lines
Improvement of service on conventional lines⇒Refer to page 39 for information on improvement of service on conventional lines.

With regard to conventional lines, we have steadily improved ourservices by, for example, launching new rolling stock and thereby
increasing the speed and frequency of services. In order to enhance
the convenience of limited express trains, we will continue todevelop an integrated network of Shinkansen and conventional lines
by improving connections between the two and increase flexibility
in the operation of major limited express trains by increasing thefrequency of services or number of cars per train to absorb thedemand fluctuations caused by seasonal factors and events. Goingforward, we will continue to work to further enhance safety andcomfort by developing next-generation hybrid powered limited
express rolling stock and other initiatives. Moreover, in order tooffer convenient timetables for local train passengers, we willcontinue to develop a
convenient rapid trainsystem, operate trainsat regular intervals, andincrease the frequencyof services or thenumber of cars per train,
especially during themorning and evening
commuting hours.
Next-generation HC85 series (testing vehicle)

Sales and marketing in coordination with local communities
We are taking measures to stimulate demand through various
tourism campaigns, and while continuing to strengthen our
relationship with local residents and travel agencies at tourist spots
in our operating areas. This has not only helped revitalize local
communities, but also led to increased revenues for our company
by expanding the use of Shinkansen and conventional lines.
For example, in order to promote the use of limited express
services on conventional lines, we are conducting the “Shupo”
Campaign to introduce various tourist attractions along our railway
lines and“Sawayaka Walking”to offer free-of-charge walking tours
that start from our stations and go around wayside sightseeing⇒Refer to page 53 for information on sales and marketing in cooperation with local communities.

spots. We are also collaborating with local governments, travel
agencies, etc., throughthe Destination Campaign
organized jointly by the six
JR passenger rail operators
to develop attractive tourism
re sou rce s an d produ cts an doperate sightseeing trains,etc., to promote the use of
our services, including the
Shinkansen.

Shupo Campaign

Affiliated Businesses
Revitalization of local communities through affiliated businesses
The development of Nagoya Station, the largest station in our
network, is a pillar of our affiliated business. JR Central Towers,
opened in 2000, and JR Gate Tower, opened in 2017, havebeen attracting large numbers of visitors. Already recognized as
landmarks of Nagoya, these buildings have made a significant
contribution to the economic development of the Chubu region.
Going forward, we will continue to operate JR Central Towers and
JR Gate Tower in an integrated manner to maximize their synergies
in order to meet a variety of needs and increase operating
revenues.
Also, we will further invigorate the merchandizing business⇒Refer to pages 42 to 43 for information on affiliated businesses.

and the station building business by developing stores in stationbuildings and renovating
commercial facilities, aswell as work to makeeffective use of land
owned by the Company
to further expand
earnings.

Nagoya Station

20

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

⇒Refer to page 52 for information on initiatives for barrier-free access.

Barrier-free access, support for overseas visitors

By continuing to strengthen
conventional lines in the Tokai
region that form a network with
the Tokaido Shinkansen, as well
as affiliated businesses that are
expected to generate synergies withthe railway business, such as the
JR Central Towers and the JR Gate
Tower at Nagoya Station, JR Central
is working to expand businessrevenues and contribute to themaintenance and development of
the local social infrastructure.

Safety and security in stations and trains
In order to ensure security within railway stations, trains, and importantfacilities, our company has installed security systems such as security
cameras, fences on the tracks of Shinkansen trains, and patrols by
security guards. In addition, the police cooperate in patrols. Furthermore,in cooperation with relevant agencies such as the police and fire
departments, practical joint training is carried out to improve response
capabilities. Through these efforts, we will continue to make constantefforts to ensure that our customers can use our trains with greater

Contribution to global environment
Railways have the outstanding characteristic of being highly
energy efficient compared to other transportation modes and having
minimal adverse impact on the global environment. In addition to
directly reducing the load on the environment by further improving
energy efficiency in its railway operations, such as by lowering power
consumption in rolling stock, JR Central also mitigates the load

Response to intensifying natural disasters
JR Central strives to ensure safety by responding in a timely andappropriate manner to a variety of situations caused by intensifying
natural disasters. In the event that a major impact on train operations
is expected due to a typhoon, heavy rain, or the like, we place thehighest priority on safety and, in order to avoid the risk of overcrowding
in stations and trains being stranded between stations for a long periodof time, we make decisions on appropriate operation plans, including
at times announcing suspension of operation at an early stage. Aftersuspension of operations, we promptly confirm the safety ofthe trains before resuming operations. We are also working
to provide more prompt and accurate information via station
facilities, our website, Twitter, and other means.
In addition, we are taking measures, including technologicaldevelopment, to strengthen and maintain our facilities not only
by limiting the spread of damage in the event of a disaster,
but also by anticipating and responding to the occurrenceof a disaster. Examples include early earthquake detection
on the Shinkansen and more detailed operation regulations⇒Refer to page 41 for information on inbound support.

local regions along the lines. JR Central is implementing a variety ofsales measures in order to encourage tourists to Japan to enjoy theareas along our railway lines casually and conveniently. In addition, we
are working to strengthen information services at stations and otherlocations, improve free WiFi environments, and expand
tourist information sites inforeign languages. In the future,
we will continue to work withlocal people along our railway
lines and travel agencies
to increase the demand for
tourism to Japan.
Guiding a customer using a mobile translation machine⇒Refer to page 29 for information on measures to combat infections.

peace of mind.
At present, due to the outbreak of COVID-19, the number ofpeople using trains and other means of transportation has decreased
significantly, and it is considered that public awareness of infectious
diseases will increase even after the situation settles down. JR Central
intends to continue to fulfill its role as a means of transportation bytaking various infection prevention measures so that people can continue
to use railways with peace of mind.

⇒Refer to pages 56 to 61 for information on our contribution to the global environment.

placed on the environment across the entire Transportation section,
brought about by having as many passengers as possible opt to use
railway services, which has a smaller environmental impact comparedto other modes of transport.

⇒Refer to page 34 for information on our response to natural disasters.

using rainfall radars. In terms of software, we are repeatedly performing
practical training so as to be able to respond to various conditions
expected in the event of extraordinary situations such as natural disasters
or contingencies.
We will continue to promote various types of initiatives and fulfill
our responsibility as a railway company to ensure safe and reliabletransportation even in the event of unforeseen circumstances, thereby
contributing to the realization of a sustainable society.

An electric bulletin board at the station ticket gate (Shinkansen)
CENTRAL JAPAN RAILWAY COMPANY Annual Report 202021

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

The Chuo Shinkansen Project Using
the Superconducting Maglev System

Special Feature 1

The realization of the Chuo Shinkansen using Superconducting Maglev System will contribute to the energizationof Japan’s economic and social activities, making Japan’s main transportation artery between Tokyo, Nagoya,

The Chuo Shinkansen Project Using
the Superconducting Maglev System

and Osaka a dual system, and merging the three major metropolitan areas into“Super Mega Region”.
Super Mega Region 66.48 million people GDP: 311 trillion yen *1
Kansai Region

Central Region

Tokyo Metropolitan Area

（Osaka, Kyoto, Nara, Hyogo ）（Aichi, Gifu, Mie）

（Tokyo, Kanagawa, Chiba, Saitama）

18.30million people GDP：74trillion yen

ShinagawaTravel Time Reduction

Shinagawa‒Nagoya：86minutes→40 minutes(fastest)
Shinagawa‒Osaka :142 minutes→67 minutes(fastest)

Gifu

Nagano*2

YamanashiSuperconducting Maglev System is a projecttransport between Tokyo, Nagoya and Osaka.

to duplicate our artery transportation system

This project will also dramatically improve

linking Tokyo, Nagoya and Osaka, which is theconvenience by greatly reducing travel time due

lifeline of our business and drastically prepare forto its high-speed operations, bring significant

risks such as aging in the future and large-scale

benefits and potential for development to thedisasters of the Tokaido Shinkansen. This projectJapanese economy and society, and ensure thewill allow us to further reduce management risk

long-term interests of shareholders and all other285.6km / 5,523.5billion yen *3and thus stabilize our management base, andstakeholders over a long period of time.

438km *4 / 9,030.0billion yen *5

Chuo Shinkansen

Tokaido Shinkansen（Trillion yen）

（Operating speed：285km/h）

600
400

Shin-Osaka

Comparison of GDP between thethree major metropolitan areas and major countries

311trillion yen

2000Japan Three major
FranceUK
metropolitan areas（Source）United Nations database, Cabinet Oﬃce“Report on
Prefectural Accounts”*Three major metropolitan areas are calculated taking thefollowing prefectures into account Tokyo, Kanagawa, Chiba,
Saitama, Aichi, Gifu, Mie, Osaka, Kyoto, Nara, Hyogo

Value Provided by the Chuo Shinkansen

an integrated manner along with the Tokaido Shinkansen.

Distribution map of the estimated biggest seismic intensity of the
Nankai Trough Large Earthquake

Chuo Shinkansen

Shinagawa

NagoyaSeismic
intensity class
Shin-Osaka

Tokaido Shinkansen

7
6 upper
6 lower
5 upper
5 lower
4*Source: Prepared by JR Central based on“Countermeasure against Nankai Trough Large
Earthquake (Final Report)”(May. 2013)

Chuo Shinkansen Project as a national project

We will continue to fulfill our mission into the future by reducing
management risks and stabilizing our management base bycompleting the Chuo Shinkansen Project. Furthermore, by adopting
the Superconducting Maglev System for the Chuo Shinkansen, we
can expect a drastic reduction in travel time between cities, andthe three major metropolitan areas will be transformed into one
mega-metropolitan area, the so-called“Super Mega Region,”where
the interaction of people will be highly activated and economic
and social activities will be energized, which is expected to have asignificant positive effect on our business.

❶ Creation of new demand
In the competition between the Shinkansen and aircraft, theshorter the travel time of the Shinkansen, the greater its share.
Demand is therefore expected to shift from aircraft to the Chuo
Shinkansen due to the time reduction effect of Superconducting
Maglev System. In addition, the dramatic time reduction will greatly
stimulate the flow between metropolitan areas, which is highly
expected to generate new demand.
Furthermore, in addition to the anticipated new use ofintermediate stations in Kanagawa, Yamanashi, Nagano, Gifu
prefectures, there is a possibility of significantly improving travel
time and frequency between cities along the line and the threemajor cities, and increasing in the flow of people if there is room
to increase the number of operations and the number of stops
for the“Hikari”and“Kodama”by taking advantage of the extra
transportation capacity caused by the transfer of “Nozomi”
passengers to the Chuo Shinkansen.

World’
s fastest speed brings each area along the line closer
40 minutes(fastest)

About 60 minutes

About 45 minutes

About 25 minutes

About 10 minutes

Gifu Prefecture（tentative name）

Nagano Prefecture（tentative name）

Yamanashi Prefecture(tentative name)

Kanagawa Prefecture（tentative name）

About 15 minutes

About 25 minutes

About 45 minutes

About 60 minutes

NagoyaThe possibility of using the Tokaido Shinkansen will increase

Shinagawa
40 minutes(fastest)

Image of the Number of Operations
Tokyo

Shinagawa

Stations where Hikari and Kodama stop

Shin-Yokohama

OdawaraAtami

MishimaStations where Nozomi, Hikari, and Kodama stop

Shin-Fuji

Shizuoka

Kakegawa

Hamamatsu

Toyohashi

Mikawa-Anjo

Nagoya

Gifu-Hashima

MaibaraKyoto

Shin-Osaka

capital investment, would not be hindered by application of the Act,
we referred fundamental clauses regarding application of the Act to the
Ministry of Land, Infrastructure, Transport and Tourism (hereinafter,“MLIT”)
and received a reply in January 2008 indicating that those principles
would not be hindered.
We will take steady steps towards the successful completion ofthis project, maintaining sound management and stable dividends anddemonstrating our flexibility, while making necessary investments toensure safe and reliable transportation, and to enhance competitivenessin the Tokaido Shinkansen and conventional lines, as well as ensure soundmanagement and provide stable dividends. We will first realize the project
between Tokyo and Nagoya, where we have received approval for theconstruction plan, and strive to further extend to Osaka.

Special Feature
CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

*2

*1 Source: [Population] Ministry of Internal Affairs and Communications "Population, Demographics and Number of Households Derived from Basic Resident Registration" (As of January 1, 2020) / [GDP] Cabinet Office "Reporton Prefectural Accounts" (FY2016) *2 The name of each station located in Kanagawa, Yamanashi, Nagano, and Gifu on the Chuo Shinkansen line is temporary. *3 Source: Construction Implementation Plan (Part2) of the Chuo
Shinkansen Section between Shinagawa and Nagoya (Mar. 2018) *4 Source: the Research Report on the Chuo Shinkansen Section between Tokyo and Osaka (Dec. 2009) *5 Source: the Development Plan (May. 2011)

Outline and Significance of the Chuo Shinkansen

The Chuo Shinkansen is being constructed in accordance with the Act,
which is a legal system for developing infrastructure essential to the nationin order to contribute to the development of the national economy, theexpansion of the area of Japanese people’s lives, and the developmentof local communities. Based on the Act, we received the designation
as the operator and the order for construction from the Minister ofLand, Infrastructure, Transport and Tourism in May 2011, and then theconstruction implementation plan was approved by the Minister of Land,
Infrastructure, Transport and Tourism in October 2014. In the meanwhile,
we have conducted environmental assessment procedures and publishedthe final environmental impact assessment report between Tokyo andNagoya, which is promoted as the first stage.
On the other hand, in order to confirm that the principles of a privately
owned company, such as freedom of management and autonomy of

Kanagawa（42.8㎞）（Operating speed：500km/h）

Nagoya*2

Yamanashi Maglev Line

undertaking high-speed, large-capacity passenger

to continue to carry out our founding mission of22*2

T h e C h uo S hi nk a ns en P r o j ec t usin g th e

We are promoting the Chuo Shinkansen Project using theSuperconducting Maglev System based on the Nationwide
Shinkansen Railway Development Act (hereinafter,“the Act”
) tocontinually carry out our mission of operating a high-speed railway
linking the Tokyo Metropolitan area, Central, and Kansai regions(from Tokyo through Nagoya to Osaka), which is the lifeline of ourbusiness, and to ensure the future foundation of the company.
The Tokaido Shinkansen has been in operation for more than 55
years, and while we have carried out the large-scale renovation,
there is a risk of suspension due to major facility replacement
caused by future aging. Japan is an earthquake-prone country,
and although we have taken measures for earthquake resistance,
there is a risk of large-scale disasters, such as possible disruptionof Japan’s main transportation artery due to a heavy earthquake.
Therefore, as a drastic measure to prepare for these future
management risks, we decided to complete the Chuo Shinkansen as
quickly as possible, under the assumption that we bear the cost of
its construction, utilizing the Superconducting Maglev System which
we have developed. The Chuo Shinkansen will make Japan’s maintransportation artery a dual system and JR Central will operate it inTokyo

36.75 million people GDP: 182 trillion yen

11.42 million people GDP: 55 trillion yen

Stations where Kodama stops

Nozomi

Hikari and Kodama
The number of“Hikari”and“Kodama”will increase

Nozomi

Hikari and Kodama● From“Nozomi”centered timetable to“Hikari”and“Kodama”centered timetable.

Present(Image)After starting theoperation of the Chuo
Shinkansen’s entire line

→ Travel time and frequency between the cities along the line and the three major cities improves significantly.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202023

Business Strategy▶ Special Feature 1

ESG Activity Report

Due to the overwhelming time reduction effect of theSuperconducting Maglev System, Tokyo - Nagoya - Osaka will beconnected in about 1 hour, and the three major metropolitan areas
will become“Super Mega Region”with a total population of about
66 million, which exceeds half of Japan’s population.
This“Super Mega Region”is expected to become the core driving
new growth for Japan, which is experiencing a declining population,by broadening the scope of activities and thereby significantly

changing lifestyles such as the way people do business and spend
their leisure time, as well as expanding various possibilities. The
final report of the“Super Mega Region Concept Study Group”
established by MLIT titled “Creating Super Mega Region to
Overcome a Declining Population: Creating New Value throughLiberation from Time and Place”(May 2019) presents the following
as“impacts of the Chuo Shinkansen”.

Opportunities for face-to-face interaction between people will increase and the time for interaction will expand,which will lead to opportunities for creating new innovation.

● It is expected to bring about changes in business styles and lifestyles by liberating people from“time”and“place”, which have been factors that restrict working and living styles, and providing a variety of options.
● Due to the integration of the three major metropolitan areas, the entire Super Mega Region will create
new value and growth industries, which will increase the attractiveness of the region in inviting people
and investment from overseas.
● By organically connecting the Chuo Shinkansen, Shinkansen, and expressway networks, it is expected thatthe multiplicity and substitutability of the high-speed transportation network, which forms the frameworkof the national land policy, will be enhanced, and sustainable flow of people and goods will be secured.
● It is expected that new regional revitalization will begin in the areas around the intermediate stations
located between the three major metropolitan areas, and that the effects of the Super Mega Region
will spread widely beyond areas along the Chuo Shinkansen.
*Extract and summary by JR Central of the final report of the“Super Mega Region Concept Study Group”established by MLIT (May 2019)

Furthermore, according to the “National Land Policy
Simulation Model” compiled by MLIT, the productivity
improvement effects of the formation of the Super Mega
Region as a result of the opening of the Chuo Shinkansen are
estimated to be 3.5 trillion yen per year for the opening of theline up to Nagoya, and 6.5 trillion yen per year for the openingof the line up to Osaka*.
In this way, the dramatic reduction in travel time brought

about by the opening of the Chuo Shinkansen will have a major
impact on the entire country, and will lead to the creation of
new value and the sustainable growth of Japan as a whole.

*National Spatial Planning and Regional Policy Bureau of MLIT“FY2017 Survey
Report on the Development of National Land Policy Simulation Model” (July2018)

Promotion of Construction
We place importance on construction safety, environmental preservation, and cooperation with local communities, and are steadily
promoting construction of the Chuo Shinkansen in each area along the the line.

Construction of terminal stations

Mountainaous tunnel construction

Urban tunnel construction

The construction of the Shinagawa and Nagoya
terminal stations involves installing a largescale underground structure in the basement of
the Tokaido Shinkansen and other lines while
they are in operation, which is very difficult
and requires the utmost care and high level
construction technology. In addition to safely
replacing existing structures of the commerciallines, we will construct earth retaining walls
to protect the surrounding areas. Then, we
will construct a structure that will become thestation of the Chuo Shinkansen in the excavatedunderground space using the open-cut methodthat digs down mainly from the ground surface.

For tunnel construction in mountainous areas,
we adopt the New Austrian Tunneling Method(NATM). NATM uses shotcrete to harden
the surface of the ground drilled by machineor blasting, bolts and concrete to fix therock around the tunnel, and then the rock is
integrated with the natural ground. This allows
the natural support of the natural ground to be
used for digging.

We adopt the shield tunneling method fortunnel construction in urban areas. The shieldtunneling method is a method in which acutter slowly rotates inside a protected steel
tube (shield machine) and excavates soil while
drilling. In the construction, vertical shafts(emergency access), which are the starting
point of the shield machine, are first drilled,
and then the shaft is laterally drilled by theshield machine from one vertical shaft toanother.

Construction of the Chuo Shinkansen is proceeded with consideration for the surrounding environment. The main environmental
conservation measures to be implemented are as follows.
Atmospheric environment(air quality, noise, and vibration)(water quality, water resources, and groundwater)

Water environment

Animals, plants, andecosystems

Reducing the impact of vehicles used
to transport materials and machinery

T he us e o f l o w -no i s e andWastewater and turbid water generated

In the detailed planning of

We reduce the generation

low-vibration construction

by construction work are discharged into

construction, we avoid placesof dust by cleaning andmachinery with low exhaust

public waters after taking measures suchwhere important plant species

watering the entrances, exits

emissions reduces theas treatment and neutralization to reduce

grow to the extent possible and, if

and surrounding roads forgeneration of nitrogen dioxide

turbidity as necessary, by means of turbid

it is unavoidable, we compensate

vehicles used to transportand suspended particulate

water treatment facilities, in accordance

for the influence on the growing

materials and machinery, andmatter, as well as noise andwith wastewater standards, etc., based

environment of important species

by cleaning their tires.

vibration.

on laws and regulations, thereby reducing

by transplanting and seeding in

the impact on public waters.

places with similar environments.

Overview and Development History of Superconducting Maglev System Technology
Superconducting Maglev System is an advanced technology unique toJapan. Instead of using friction between wheels and rails as conventional
railways , it runs in a non-contact manner due to the magnetic force between
the Superconducting Magnet mounted on the vehicle and the coils mounted
on the ground. In addition, to obtain the strong power of the magnets, thetechnology uses a superconducting magnet utilizing“the‘superconductivity’phenomenon in which electrical resistance vanishes when a particular
substance is brought below a certain temperature,”which enables thevehicle to levitate about 10 cm, making it possible to operate safely inearthquake-prone Japan. These features make it possible to travel at an ultrahigh speed of 500 km/h in a stable manner, unlike conventional railways.
The level of the Superconducting Maglev System Technology has been
evaluated in multiple stages since running tests began on the Yamanashi
Maglev Line in April 1997. In July 2009, the Superconducting Magnetic
Levitation Technological Practicality Evaluation Committee of MLIT
(hereinafter,“Evaluation Committee”) confirmed that the Superconducting
Maglev System Technology had already achieved levels sufficient forcommercial service and the Minister of Land, Infrastructure, Transport andTourism established the technological standards for the Superconducting
Maglev in December 2011. Since then, we have continued running tests, andin February 2017, the Evaluation Committee confirmed its evaluation thatthe technology development required for commercial lines was completed.
We will continue to make efforts to further brush up Superconducting
Maglev System Technology, including improving comfort and enhancing
efficiency of maintenance. We will also conduct running tests using Series L0
improved version and develop commercial vehicle specifications, as well aswork to reduce costs for the construction, operation, and maintenance ofcommercial lines.

Progress on the Superconducting Maglev System Technology
June 1990

JR Central applies to the Minister of Transport for approval of theconstruction plan of the Yamanashi Maglev Line and gains approval

April 1997

Running tests start on the Yamanashi Maglev Line

March 2000

The Superconducting Magnetic Levitation Technological
Practicality Evaluation Committee of the Ministry of Transport(hereafter, the“Evaluation Committee”) acknowledges that“there
is potential from a technological standpoint that the technology
could have practical applications”

November 2004

JR Central performs exercises of trains passing each other at 1,026
km/h relative to one another

March 2005

The Evaluation Committee of MLIT acknowledges that“the coretechnologies for practical application have been established”

The Evaluation Committee of MLIT acknowledges that“the technologies required for commercial services havebeen established from a comprehensive and systematic
July 2009 standpoint, and it is possible to move forward with detailingthe specifications for commercial services and the technicalstandards”

December 2011

The Minister establishes the technical standards forSuperconducting Maglev

August 2013

Extension of the Yamanashi Maglev Line to 42.8km and upgradingof facilities are completedApril 2015

JR Central records a travel distance of 4,064 km in one day
JR Central records the world speed record for a manned rail
vehicle at 603 km/h

February 2017

The Evaluation Committee of MLIT evaluates that“the technology
development required for commercial lines was completed”

August 2020

Running tests start using Series L0 improved version

History of Maglev Vehicles

MLX01-1

MLX01-901

Series L0

In order to establish commercial vehicle specifications, in August 2020 we started runningtests using Series L0 improved version, which further brushed up Series L0 based on the resultsof running tests so far.

24

Corporate Data

Implementation of Environmentally Conscious Construction

From the Final Report of the“Super Mega Region Concept Study Group”(May 2019)

Nagoya Station

Financial Information

The Chuo Shinkansen Project Using theSuperconducting Maglev System❷ Broad ripple effects on the economy and society●

Special Feature

Southern Alps Tunnel (Yamanashi construction area)

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Shield machine assembly (North Shinagawa Emergency Access)Series L0 improved version

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202025

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Technological Development to
Support JR Central’s Growth

Special Feature 2

Technological Development to
Support JR Central’s Growth
In order for JR Central to fulfill its mission anddevelop in the future, it is essential to constantly
work to ensure daily safe and reliable transportation,
to pursue comfortable transportation services, andto build the hardware and systems that will support
these efforts through technological development.
In regard to technological development in railway,
it is necessary to bear in mind that only wheneach physical and non-physical research result is
integrated and reflected in actual transportation
services and management systems will it generatevalue to the business, and that the railway

business is greatly affected by social and economic
conditions. In order to address various technologicalissues in a more integrated and comprehensive
manner, our company has set issues that contributeto company measures from a medium to longterm perspective at the Komaki Research Centerestablished in 2002 and, while systematicallyengaging in technological development, is further
pursuing issues related to ensuring safe and reliabletransportation in the railway business, while
engaged in technological development with the aimof finding solutions.

Basic railway R&D cycle
Acquisition of large
amounts of ﬁeld data

Field-based veriﬁcation(From testing on main lines, etc.)(From rolling stocks in commercial services,above-ground facilities, test rolling stock, etc.)

Understanding
phenomena
occurring in the ﬁeld

Major Technological Development Results(Fiscal Year)
Contact wire status monitoring system

New ATC
Establishment of Komaki
Research Center2002

ATC signal and track circuit statusmonitoring system

ATC performance improvements
New movable platform
fence for Tokaido
Shinkansen

Series N700

2005

2007

2009

New typeelectronic level
Next-generation track
crossing controller status monitoring system

High-speed heavy
simple catenary

2012

2013

2014

2017

2018

2019

2020
N700S

Seismic
countermeasure forconcrete viaducts

Derailment prevention
guard and deviation
prevention stopper

N700A

The method for largescale renovation of
Shinkansen infrastructure

N700S verification
testing trainset
Movable platform fenceof conventional lines

Limited express train
rolling stock using
hybrid method

Research and Development of Leading-Edge Technologies for the Future
The importance of technological development in the railway
business will not decrease. On the other hand, looking ahead tothe future, the environment surrounding our company will become
further complicated due to a decrease in the labor force andchanges in working styles caused by the declining birthrate andaging population, intensifying natural disasters, growing awarenessof the global environment, and the like. In addition, the movement
toward digital transformation as a result of the rapid advancementof information and communications technology (ICT) has brought
about changes in the way businesses are run and the creation of
new businesses, as well as presenting new solutions to various

technological challenges. In 2020, JR Central established a special
unit within the Technology Research and Development Department
to further strengthen its efforts to formulate ICT strategies in lightof rapid technological progress, gather needs, allocate appropriate
management resources, and execute highly challenging development
projects. We will continue to push ahead with these efforts evenmore vigorously. We will continue to fulfill our unchanging mission
and create new value by actively using advanced technologies tofirmly incorporate technological innovations into our company’srailway system and expand our company’s technological fields into
the future.

Promoting Technological Development at the Komaki Research Center
Theoreticalanalysisand simulation

Theoretical analysis

Examination using
testing equipment

Veriﬁcation using full scale large
testing equipment

Key Themes of Technology Development
We are promoting technological development based on the following pillars, namely,“ensuring safe and reliable transportation,”“improvement in the convenience, comfort and efficiency of Tokaido Shinkansen,”“overhauling maintenance, service operations andadministration,”and“technological development in anticipation of the opening of the Chuo Shinkansen.”Ensuring safe and reliable transportation

Improvement in the convenience, comfort, and efficiency of the Tokaido Shinkansen

In order to ensure even higher levels of safe and reliabletransportation, we are promoting the development of technologies
for accurately detecting natural disasters such as earthquakes andheavy rain, technologies for reducing damage, and technologies forearly recovery from disasters.

Looking ahead to the opening of the Chuo Shinkansen, we areworking to develop technologies that will further enhance theconvenience, comfort, and efficiency of the Tokaido Shinkansen inorder to continue to strengthen our competitiveness as Japan’smain transportation artery.

Overhauling maintenance, service operations and administration

Technological development in anticipation of the opening of the Chuo Shinkansen

In order to cope with the expected decline in the labor force
in the future, we will work to improve the level and save labor of
inspections and maintenance based on the introduction of newtechnologies, data analysis and evaluation, and active maintenance,
thereby building an efficient and safe system.

By making the most of the knowhow, knowledge, and technologicalcapabilities possessed by the Technology Research and Development
Department, we are promoting technological development that will lead tocost reductions and labor savings, such as construction and maintenance of
the Chuo Shinkansen, as well as advancing the depth of core technologies,
such as design, analysis, and simulation, common to all of the three
generations of railways.

In order to sustain and develop our company into the future, we are also working to broaden the scope of our company’stechnological fields to a wider range of areas. We will strive to develop new value and future visions that we want to create, andtake on the challenge of research and development to realize them.

26

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

To proactively deepen railroad technologies for the Shinkansen andconventional lines, JR Central pursues development of technologies
that support the future of our company, and takes initiatives toenhance technical capabilities and develop human resources. At the
Komaki Research Center, by leveraging the development capability
using actual-size testing equipment, which is the main distinctive
feature of the research center, we have made various accomplishments
in technology development, including the development of new rollingstock, the development of countermeasures against derailment anddeviation for the Tokaido Shinkansen, the development of large-scalerenovation methods for civil engineering structures in relation to our
Shinkansen trains, and the development of high-speed heavy simple
catenary for our Shinkansen trains. Furthermore, in light of recent
advances in ICT technology and digital transformation, the Komaki

Research Center
will actively utilize
these technologies
and play a central
role in promoting
them within ourcompany.

External view of Komaki Research Center

Human Resource Development and Enhancement of Technological Capabilities
Since the opening of the Komaki Research Center,
JR Central’s Railway Operations Divisions and theTechnology Research and Development Department
have worked closely together to respond to thetechnological challenges facing the Railway Operations
Divisions and conduct regular technical exchanges. In
addition, employees of the Railway Operations Divisions
and the Technology Research and Development
Department work together to enhance the technologicalcapabilities of the entire company. In addition, we
promote efforts to develop engineers, such as reports
and presentations on technological development results,

surveys and reports on the latest technological trends by
young researchers, holding seminars by inviting outside
lecturers for the purpose of improving technologicalinsight and technological exchange, and supporting
research by researchers who have free ideas and takeon new challenges. Going forward, we will continue tomonitor technological trends in other industries andfields, broaden our scope of inspiration and application
capabilities, and actively incorporate external knowledge
to enhance our organizational capabilities so that we
can address the difficult technological challenges weface in the railway business.

Technology exchange
meeting

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202027

Business Strategy▶ Special Feature 2・3

ESG Activity Report

Special Feature

Financial Information

Corporate Data

Countermeasures against COVID-19

Major Technological Developments: Responding to Natural Disasters
In recent years, river flooding and sediment disasters caused bylarge typhoons and torrential downpours have become intensified,and it is important to prepare for natural disasters including
earthquakes. Our company has worked to ensure safety from both
Example oftechnologicaldevelopment 1

Study on evaluation method of occurrence riskof debris flow

In order to construct a safer and more secure railway system against
prolonged rain and localized torrential downpours, JR Central has
implemented not only physical measures such as slope protection works but
also non-physical measures such as rain operation regulations based on theobservation values of rain gauges installed along railway lines. However, there
may be differences in the way rain falls along the railway lines and in areas
far from it and, particularly in mountainous areas, there is a risk of debris
flow disasters originating in areas far from the railway line. For this reason,
we have developed a real-time evaluation method for the risk of debris flows
occurring in mountain streams adjacent to railway tracks in the mountainline sections of conventional lines. This method classifies the occurrence ofdebris flows into two types, models the watershed of each mountain stream,and inputs the actual
rainfall amount into thismodel to estimate theoccurrence risk. Thismethod has been usedsince June 2020 toregulate the operationof conventional lines,
contributing to further
Traces of earth and sand collapse
safety during rainfalls.

②Sediment
flows

Provide ample
seating

Ventilate cars in
6-8 minutes

Interior ventilation
Shinkansen

Disinfect and clean
stations and trains,etc.

Air is always replaced with outside air by air conditioning andventilation equipment and, according to calculations, all air in the
train car is replaced with new outside air in about 6 to 8 minutes.

Conventional Air is replaced with outside air by opening andLinesclosing doors and ventilating equipment.
Air conditioning
equipment

Door

Discharge
outside*Earthquake motion
in two horizontal
directions

Outside air
Air conditioning equipment Ventilator

Reserve seats ofchoiceMeasures for closed spaces

Example of stereoscopic analysis model

Pivot bearing

Prevent droplet
infection

Air conditioning
equipment

Ventilator
Outside air Discharge outside

Outside air

Ventilator
Air conditioning
equipment
Outside air

Securing transportation capacity with the“12 Nozomi Timetable” Measures for crowded places

Figure Example of stereoscopic analysis modelOn the Tokaido Shinkansen, by utilizing the“12 Nozomi Timetable,”which can operate up to 12 services per hour in either direction,
we are working on measures to prevent congestion in trains by providing a sufficient number of seats by operating trains with sufficient
capacity.

Major Technological Developments: Labor Saving in Maintenance

Example oftechnologicaldevelopment

evaluation, and active maintenance. In recent years, we have been using
new technologies such as sensing, image recognition, information andcommunications, mass data analysis, and robotics, as well as advancing
technology development that leads to equipment integration, extended life,
and optimization of standards.

Development of technology for measuring ground equipmentusing N700S commercial rolling stock

On the Tokaido Shinkansen, the track and electrical equipment are measured

At present, we are conducting a series of running tests using the N700S

about once every 10 days using the Shinkansen Multiple Inspection Train (Dr.

verification testing trainset to confirm measurement accuracy and durability, and are

Yellow), a dedicated measurement train. In addition, we have developed technology

aiming for practical application in FY2021.

to reduce the size and weight of measuring instruments that can be installed in thecommercial rolling stock of the latest model, the N700S, in order to grasp the status
of facilities more frequently and perform maintenance work in a timely manner.

ATC signal and track circuit statusmonitoring system
Car No. 1

Car No. 12

Car No. 4

Online reservation service for
Tokaido Shinkansen Measures for close-contact settings
By using the“seat map”functionin the Express Reservation/
smartEX (online reservation andticketless boarding services) andthe reserved seat ticket vending
machine, customers can check theseat availability status and reserve/purchase their own seat.
Using this, customers can purchase
Shinkansen tickets without coming
into contact with station staff.

Contact wire statusmonitoring system

As for the measurements of the state of tracks, JR Central has developed the“Next-Generation Track Monitoring System”with improved accuracy by using its

Outside air*Image of a representative model

Pivot bearing

At JR Central, we are developing technologies to improve operational
efficiency, reduce labor, and reduce costs, such as by mechanizing andsystemizing maintenance operations, on the basic premise that safety isensured. Specifically, we are working to develop technologies based on
the three pillars of introduction of new technologies, data analysis and(Whenopeningand closing) Discharge outside

Discharge
outside③Debris flow

Figure Occurrence of debris flows (left: collapse type debris flow, right: stream bed flow
type debris flow)

Door

Discharge
outsideTrack②Debris flow

Air conditioning Outside air
equipment
Ventilator

Openablewindow

Outside air①Slope failure

The Kumamoto Earthquake that occurred in April 2016 caused derailment of
the Kyushu Shinkansen, collapse of buildings, and the collapse of overpasses with“rocking bridge piers”which are installed mainly in places where construction spaceis limited. On the assumption that a similar earthquake occurred in our company’sservice area, JR Central has taken measures to prevent derailment and deviation of
Shinkansen trains and to make buildings and other structures earthquake-resistant.
In addition, we have been examining the seismic performance of all bridges withrocking bridge piers on Shinkansen and conventional lines and, as a result of theseismic performance evaluation
Rocking bridge pierPivot bearing
by structural analysis, wehave confirmed that they havesufficient seismic performance.
Specifically, we made a detailed
three-dimensional model of eachbridge and conducted seismic
Pivot bearing
performance evaluations undera severe condition in which
earthquake motion occurredin two horizontal directions,and confirmed that the rocking
bridge piers do not overturn or
Rocking bridge pierfall at all locations.

Discharge outside

Watershed①Concentrationof surface waterCountermeasures against COVID-19

Verification of safety
in the event of an earthquake

JR Central is taking various measures toprevent the spread of COVID-19, giving toppriority to ensuring the safety of customers
and employees. We are implementing mainly
the following initiatives to ensure that
customers can safely and securely use theTokaido Shinkansen and other JR Central
railways.

Openable window

RainfallExample oftechnologicaldevelopment 2

Special Feature 3

Outside air

Rainfallphysical and non-physical aspects. In addition, we are working
to develop technologies to realize even higher levels of safe andreliable transportation, such as measures to accurately identify
disasters and minimize damage.

Car No. 16

Reservation screen

Other Initiatives
In light of the current status of infections in Japan andoverseas, we are working to prevent the spread of infections
by installing hand sanitizers at all Shinkansen stations andat manned stations on conventional lines so that they canbe used by passengers. In addition, at stations with a large
number of passenger usage, we are disinfecting handaccessible areas such as ticket vending machines daily.
In daily rolling stock cleaning on
Shinkansen and conventionallines, we have been usingalkaline electrolyzed water,which is generally effective in
disinfecting, to maintain hygienein cabins.

own calculation program. This makes it possible to measure new items such as thedeviation of the rails not only vertically but also horizontally, the distance between
the left and right rails, and the height difference.
In measuring the condition of overhead wires and signaling equipment, wedeveloped the“contact wire status monitoring system”and“ATC signal and track
circuit status monitoring system,”which are smaller and lighter. This enables
the measurement of contact wire conditions (abrasion amount, height, etc.) on
commercial trains, eliminating the need for nighttime measurements by workers, andenabling frequent checking of ATC signals and track circuit integrity.

28

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Verticalmeasuring
instrument

Measuring instrument for
distance and height
difference between
left and right rails

Next-generation track monitoring system

Measurement of ground equipment by N700S

ATC signal andtrack circuit
statusmonitoring
systemUnchanging Mission in Post-COVID-19 Society
There is a possibility that the social environment will change as
telework and online meetings become more widely used aroundthe world as a result of the self-restraint on going out following
the outbreak of COVID-19. However, the importance of faceto-face meetings between people with various knowledge andexperience will remain unchanged.

In view of these changes in the social environment, JR Central
will respond flexibly to such changes, while continuing to provide
comfortable and convenient transportation services that can beused by as many people as possible. At the same time, we willcontinue to make every effort to prevent the spread of infections
so that customers can use our services with peace of mind.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202029

SafetyBusiness Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

SafetySafetySafety Management System

Ensuring Safe and Reliable
Transportation

Operational system to ensure transportation safety
Based on the Railway Business Act, JR Central established the Safety
Management Regulations in September 2006, which summarizes the rules tobe observed for ensuring transportation safety, with the aim of maintaining
and improving safety levels. These regulations specify the operational
system for ensuring transportation safety and the responsibilities of safety
managers. As the responsibility of key safety managers, the president is thefirst to make important decisions regarding operational safety. In addition,
general safety managers, operation managers, and crew guidance managers
have been designated, and their respective responsibilities have been
determined. The roles of head office managers in ensuring transportation
safety have been clarified, and safety measures have been systematicallyestablished and promoted under a consistent system.

Responsibility of key safety managers
Titl ePresident

General safety
manager

Operation
manager
Crew guidance
manager● Ensure that all employees are fully aware of the importance of safety and comply with laws and regulations to ensuretransportation safety.
● Provide opinions to the president on necessary improvements to ensure transportation safety.
● Confirm the status of systems related to ensuring transportation safety as needed, and express opinions on improvements to head officemanagers who are in charge of the main operations related to ensuring transportation safety, as necessary.
● Supervise and manage other matters related to ensuring transportation safety.
In order to ensure transportation safety, request reports and give instructions as necessary concerning the formulation oftransportation plans, decisions on the operation of train crews and rolling stock, train operation control, training of train crews
and maintenance and management of their qualifications.
Train crew members and maintain and manage their qualifications.

Safety Promotion Committee

General Principles of Safety

The Railway Safety Promotion Committee was established at the head
office and meets once a month to deliberate on matters related to theprevention of train and labor accidents, and to formulate and promote
effective countermeasures. In addition, specialized committees are set
up as necessary to intensively deliberate on specialized matters. Also,

Basic Approach to Safety
Ensuring safe and reliable transportation marks the foundationof the railway business. Based on the recognition that safety
is the primary mission of transportation operations, JR Central
has established various internal regulations in accordancewith relevant laws and regulations, built a system to promote
safety measures in an organized manner, and at the same time,
promoted a variety of initiatives from both physical and nonphysical perspectives. Our company’s mission is to provide
customers with safe and reliable transportation. We will fulfill
our responsibilities as a transportation company by continuing
to fulfill this mission into the future.
JR Central has established the “General Principles of Safety”
as the basic spirit of all employees involved in ensuringtransportation safety. This was enacted in the era of the

Responsibil ity
Decide on important matters related to operational safety.

Japan National Railways in response to the accident at
Sakuragicho Station on the Keihin-Tohoku Line in 1951. Because
transportation operation is an important and responsible
service for safeguarding precious lives and assets, it specifically
expresses that mindset, moral awareness, and attitude areneeded for all employees to do their utmost to ensure safety
and protect human lives before all else, regardless of their job
responsibilities. As a result of various safety-related initiatives,
the Tokaido Shinkansen, in particular, since its opening in 1964,
has been used by approximately 6.6 billion passengers, andthe number of train accidents resulting in fatalities or injuriesof passengers on board has remained zero. We will continue towork tirelessly to ensure safe and reliable transportation at aneven higher level.
▶ Safety Report https://company.jr-central.co.jp/

the Shinkansen and Conventional Lines Operations Division, each branch
office, and other units also hold Safety Promotion Committees. The
matters decided by the Safety Promotion Committee are thoroughly
communicated to employees of field offices through Regional Safety
Promotion Committee meetings.

President
Railway Safety Promotion Committee
Specialized committees

Construction Department
Safety Promotion
Committee

Conventional Lines
Operations Division
Safety Promotion
Committee

Shizuoka Branch Office
Safety Promotion
Committee

Shinkansen
Operations Division
Safety Promotion
Committee

Kansai Branch Office
Safety Promotion
Committee

Regional Safety Promotion
Committee

Regional Safety Promotion
Committee

Regional Safety Promotion
Committee

Regional Safety Promotion
Committee

Field offices

Field offices

Field offices

Field offices

Chuo Shinkansen
Construction Department
Safety Promotion
Committee

Priority Execution Items for FY2020
In order to systematically and intensively promote train andla b o r a c c i d e n t p r e v e n t io n m e as u r e s , p r io r it y e x e cu ti on i te msa r e d et e r m i n e d eve r y f is cal y e ar .
In FY 2020, we po s it io n e d t h e t h r e e p il l ar s o f “ cul ti v ati n g a
s a f e t y - f i r s t c u l t u r e , ”“ i m p r o v i n g t h e a b i l i t y o f e a c h e m p l o y e e
to achieve safety,” and “strengthening of safety systems”

30

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

as “Safety Action Guidelines” for universal concepts for
ensuring safety. All employees will work together toe radi cate ( mak e ze ro) se ri ou s trai n an d l abor acci dents fromboth physical and non-physical aspects in response to thepriority execution items based on the General Principles of
Saf e ty an d th e Saf e ty Acti on G u i de l i n e s.

Safety audit
Safety audits are conducted at JR Central’s business organization andaffiliate companies to prevent train accidents and eliminate labor accidents.
These audits are performed from three main standpoints; the confirmationof the level of compliance with laws and regulations, etc., the confirmationof systems in place to prevent train and labor accidents that occurred in
the past, and the confirmation of the state of accident prevention measure
implementation. In audits, we verify the actual status of daily operations bychecking sites where work is being carried out and the documents related
to inspections, construction, etc., and share the results with the relevant

departments and affiliatedgroup companies. Throughthese audits, we are working toprevent violations of laws andregulations, the fading out of past
countermeasures in response topast accidents, and rules fromlosing their substance before an
incident occurs.

Scene of a safety audit

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202031

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

SafetyEnsuring Safe and Reliable Transportation

Initiatives for human resources to ensure safety
In order to support safety, it is important to continue to improveand refine facilities and to ensure the progress of work. However, as
the basic premise, it is essential to develop human resources with hightechnical capabilities, strong will, and correct values to support safety.
In developing human resources, we believe it is important to observe

Technical skills training

Tokaido Shinkansen

our own rules “discipline”(), to maintain and improve quality and prevent
accidents “technical(capability”), and to gain a“sense of unity”bycollaborating and cooperating with related employees and by fulfillingpersonal responsibilities. Focusing on these issues, we are engaged in
employee training and education.

Employee training in preparation for contingencies

We implement safety education and training for staff engaging in
train operations and facility maintenance. We conduct education andtraining especially for staff engaging in train operations (such as drivers,
conductors, directors, and those who handle signals or operate switch
stands) according to the content and time stipulated for each duty.
We introduce simulators, which can perform operations simulation
training, etc. for emergencies, to field offices for drivers and conductors.
We also conduct various training sessions using ground facilities, suchas actual rolling stock, railway lines, so that employees on each system
can swiftly and accurately respond to emergencies.

Emergency conditions response training

We train all employees togo beyond the call of duty inworking together with staff,
etc., to respond appropriately
in ensuring our customers’safety should employees
happen to be present when
unforeseen circumstances
occur while commuting or on a
Employee training in preparation
business trip.

for contingencies

Oth e r tra i n i n g

We conduct various training every year as an opportunity for us
to enhance quick response to safety in case of accidents and tolearn the work of other specialized fields. We conducted practicaltraining in FY2019, such as passenger evacuation guide training
sessions, information communication training sessions, and line
facility restoration training, based on the assumption of natural
disasters, such as earthquakes, and contingencies.

The General Education
Center offers education on
specialized knowledge andskills for each function, andprovides sessions for various
qualifications and train
conductors and drivers byusing various training facilities
that can simulate various
events that occur in actual
situations.

Large-scale renovation
Our civil engineering structures are sufficiently maintained through daily and thoroughThe reserve of 350 billion yen

inspections and repair. However, in future, it will be inevitable to replace many of the facilities

accumulated by FY2012 is appropriateddue to aging. We received the approval of the Minister of Land, Infrastructure, Transport andat a rate of 35 billion yen each year from

Tourism for our allowance reserve plan for the large-scale renovation of Shinkansen infrastructure

FY2013.

based on the Nationwide Shinkansen Railway Development Act, and began building the reserve

We will continue to actively incorporate

from 2002. Along with this, we have advanced our research on a new construction method, led

the results of our R&D efforts and makeby our Komaki Research Center. As a result of our R&D efforts, we developed a new construction

improvements, etc., to construction

method that allows us to significantly reduce the impact on train operations during construction

methods, thereby bringing down related

work, and to considerably cut construction costs. With this method in place, JR Central begancosts in making sure steps forward are

the renovation work in FY2013, ahead of the original schedule. In construction work, we begin

taken with our construction work.

with the implementation of measures to extend the life of structures by inhibiting the occurrenceof cracking and other damage from aging (measures to inhibit aging damage) and, if necessary,
overall renovations such as replacement of girders (overall renovation) are implemented.

Tokaido Shinkansen

Conventional Lines

Counter-disaster measures and other efforts
JR Central’s conventional lines operate not only in urban areas but also along steep
natural slopes and other varied terrain. As such, we have been making efforts to adopt
to take measures against falling rocks, such as newly installing falling rock detection nets andTokaido Shinkansen

newly installing drainage facilities.
We will also continue to advance our efforts to improve safety devices on grade crossings
together with making replacements due to aging in order to enhance safety.

Conventional Lines

Implementation of derailment and deviation countermeasures

Counter-terrorism training

We are promoting derailment and deviation countermeasures to prevent expansion of“Deviation prevention stoppers,”which

damage from derailment caused by an earthquake. In addition to installing a“derailment

prevent the rolling stock from a major

prevention guards”to prevent vehicle derailment to the extent possible, we are taking

derailment in the event of a derailment,

measures for civil engineering structures to make them function effectively. We expect tohave already been installed on all of ourcomplete implementing these measures to the entire line by FY2028.

Shinkansen rolling stock.

Reinforcement of structures
JR Central has been implementing
earthquake-resistance measures for various
civil engineering structures and buildings so as

Capital investment for safety

Derailment prevention guards

Measures taken and progress
Measures taken

Progress (as of the end of FY2019)

Elevated track columns, bridges, and embankments

to prevent the Shinkansen from going out of

Bridge railing (Fall prevention)

service for a long period of time in the event of

Station buildings

Completed * Except for some areas under discussion(Elevated track columns: Approximately 19,600;
Bridges: Approximately 900 units; Embankments: Approximately 9.4 km)
Under way (Completed 2,151 beams out of 2,215 target beams)
Completed * Except for some areas under discussion

Rolling stock workshops, etc.

Initiatives to stop trains quickly

Rolling stock depot buildings: Completed

the time of（ Atestablishment）

Seafloor Observation Network
Information for Earthquakes(NIED)

stops power transmission, and issues an order to moving trains to make an emergency stop.
the stopping distance at the time of an earthquake. For the new model Shinkansen rollingstock N700S, which we launched in July 2020, we made improvements to ATC and the brake

Distant
seismometersystem to further reduce the stopping distance by roughly 5% compared to the stopping

Seismometer
alongsiderailway lines
Relay Station

distance of N700A (3rd edition).
*After introducing the“Urgent Earthquake Detection and Alarm System (UrEDAS)”in 1992
before other companies, we introduced the“Tokaido Shinkansen Earthquake Rapid Alarm
System (TERRA-S)”in 2005, thereby improving the system in the speed of the alarm, etc. In
April 2019, we continued to further accelerate the speed of the alarm by utilizing informationfrom the Seafloor Observation Network for Earthquakes and Tsunamis.

Suspension of power transmission→ Emergency stop of train

Earthquake early warning(Japan Meteorological Agency)

We also made improvements to the“Earthquake Brake”on rolling stock in an effort to reduce

Tokaido Shinkansen

Hamamatsu Workshop: Completed

Tokaido Shinkansen Earthquake Rapid Alarm System (TERRA-S)

JR Central adopts an earthquake prevention system* which detects tremors, automatically

JR has actively implemented capital investment related to safety since its
25 and 26, these fences will be put into service on the platforms 23 and 24 thisestablishment. In the 33 years up to FY2019, we have made safety-related
fiscal year. With respect to conventional lines, we will work on the installation
investments totaling over 3.8 trillion yen, including safety measures such as
on Kanayama Station of the Tokaido Line and start operation on the platform
updating the Automatic Train Control (ATC) and Centralized Traffic Control (CTC)
for Toyohashi-bound trains. As a result of these efforts, 70% of the total capitalon the Tokaido Shinkansen, introducing and updating CTC on conventional
investment in Tokaido Shinkansen, conventional lines, and affiliated businesses,
lines, and replacing the Automatic Train Stop (ATS) with ATS-PT, as well asor 234.0 billion yen, is planned for safety-related investment.
disaster prevention measures such as seismic reinforcement,
improvements in electrical equipment, replacement ofTrends in safety-related investment
234.0
new rolling stock, and introduction of efficient and effective(Billion yen)220
inspection machines and systems.
In FY2020, we will continue placing top priority on ensuring
200
186.2
safe and reliable transportation, which is the starting point of
180.8
180
173.1 173.1
our railway business. In order to further reinforce structures
167.3 170.1
164.7
160
along with earthquake countermeasures, JR Central will
143.5
142.9
pursue derailment and deviation countermeasures for the
138.5
140
136.9
Tokaido Shinkansen by implementing derailment prevention
120
guards for the entire line. We will also proceed with the100
implementation of measures to prevent suspended ceilings
at stations from falling in the event of an earthquake and80
reinforcing the quake resistance of the Nagoya Workshop,
60
viaduct pillars of conventional lines, etc. In addition, to ensure
39.1
40that passengers can use trains with greater peace of mind,
we are proceeding with the installation of movable fences
20on the platforms of Tokaido Shinkansen at Shin-Osaka
0
Station. Following the installation of fences on the platforms
FY1987
FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

protective equipment, and against heavy rainfall, such as reinforcing slope protection andmeasures against falling rocks, heavy rainfall, and other disaster situations. We will continue

an earthquake.

32

Large-scale renovation

Further Reinforcement of Earthquake Countermeasures

Training for Shinkansen conductors
Passenger rescue training

Conventional Lines

Substation
Vertical earthquakes

Trench-type earthquakes

Detects P-wave (primary tremors) and S-wave (secondary tremors), and once a certain level of tremors is detected, issues an order for trains to stop

Conventional Lines

Reinforcement of structures
In order to minimize the impact of earthquakes also on conventional lines, weare implementing earthquake-resistance measures on various structures.

Initiatives to stop trains quickly
Information from the aforementioned earthquake prevention system will
be used for conventional lines to detect the initial weak tremors in case ofan earthquake, and provide a warning to the driver’s cabin of trains travelingin segments that are likely to be impacted significantly by the earthquake.
Furthermore, we have been strengthening the functions of seismometers
since FY2016. We will be able to issue warnings to trains more quickly than
before.

Measures taken and progress
Measures taken

Progress (as of the end of FY2019)

Elevated trackcolumns, bridges, andembankments

Elevated track columns: Under way (Completed 5,078 columns previously targetedat the end of FY2017. Since FY 2019, 3,338 have been newly added and 419 havebeen completed for the purpose of further early recovery in the event of a disaster.)
Bridges: Completed (4 target bridges)

Bridge railing(Fall prevention)

Completed (1,985 target beams)

Station buildings

Under way (Completed 74 stations of the 77 target stations with 5,000 passengers per day)

Rolling stock
workshops, etc.

Nagoya Workshop: Rebuilding and reinforcement of buildings under way (Planto complete by the end of FY2021)*Earthquake-resistance reinforcements under way in sections including those where there are at least 10 departures
per peak hour and where a long, strong earthquake vibration is expected, as in the case of the Tokai Earthquake（plan）CENTRAL JAPAN RAILWAY COMPANY Annual Report 202033

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

SafetyEnsuring Safe and Reliable Transportation

Tokaido Shinkansen

Operation Management and Safety Measures

Conventional Lines
Hanging bolts

Earthquake-resistance measures for ceilings of stations
In order to heighten safety at stations, since FY2016 we have installed
earthquake resistance measures on suspended ceilings (a type of ceilingwith a structure that hangs from the building frame) at stations that service
a large number of customers. We prevent suspended ceilings from fallingby firmly joining the building frame and the ceiling with wires and taking
other measures. These measures have been taken targeting all 17 stationsof the Shinkansen and 30 stations of conventional lines that service atleast 10,000 customers per day, and completed at three stations of the
Shinkansen and eight stations of conventional lines as of the end of FY2019.

Tokaido Shinkansen

Conventional Lines

The principle of Crash Avoidance
The biggest feature of the Tokaido Shinkansen and other Japanese
high-speed railway systems is the introduction of an operation control
system based on the principle of Crash Avoidance. This principle
has been derived to prevent the possibility of a collision by using (1)dedicated tracks for high speed passenger rail service, which completely
exclude freight and commuter rail and have no grade crossings, and(2) an Automatic Train Control (ATC) system, which automaticallycontrols the speed limit of high speed trains and prevents collisions fromhappening.

Earthquake-resistance measure: Joining the building frame and the ceiling with wires
Station concourse, etc.
Illustration of anti-falling measure

Response to other natural disasters
In addition to earthquakes, the prevention of accidents caused by natural disasters such as tsunamis, heavy rains, typhoons, andsnowfalls is one of our important pillars of safety measures, and we are implementing various measures.

⑤When the train’s speed exceeds
the signal the brakes are applied

Speed of own train②Own train positional information

Ground facilities (for positional adjustments)

Receive the information

Preceding train①Preceding train positional information (rail)

it can serve as an alternative control center should Tokyo’s General Control Center become non-operational
due to a disaster. Thus, we have strengthened our crisis management in preparation for emergencies.
※COMTRAC (COMputer-aided TRAffic Control): A system that controls train routes,
manages train operations, and operates and manages the allocation of staff (drivers
and conductors) and rolling stock. Based on input data prescribing the operational
conditions for each train (such as station departure and arrival time, platform, andorder) in the computer, the system can monitor the status of all trains in operation at
all times.

The Shinkansen Multiple Inspection Train (Dr. Yellow)
Evacuationroute display ontablet terminal
for conventionalline train driver

We have also introduced the “Shinkansen Multiple Inspection
Train (Dr. Yellow)” to test electrical facilities such as overhead
wires and ground facilities such as tracks. This rolling stock, which
is based on the Series 700, aids safe and reliable transportation by
efficiently conducting high precision inspections at speeds of 270
km/h.

Dr. Yellow

Rain cou n t er m eas ur es
We are taking measures such as protecting the slopes of embankments and cut
sections with concrete and other materials, laying drainage pipes to promote drainage,and installing earth and sand stoppers to prevent the inflow of earth and sand.
Furthermore, rain gauges are installed along railway lines, and when the amount of
rainfall exceeds the regulation value, a warning is automatically issued to the control
center, train station, etc., and operation regulations such as suppressing or slowing
down trains are carried out. Furthermore, in June 2020, we introduced an operation
regulation using rainfall radars in all sections of conventional lines. These regulations
are lifted after safety is confirmed.

③Creates ATC signals (train speed comparing patterns)
from positional information for the train ahead andone’s own train④Compares the
speed with the signal

Shinkansen General Control Center / Operational control systems
The safe and reliable transportation of the Shinkansen is supported by the Shinkansen General Control
Center in Tokyo, where directors work in close collaboration using various systems, such as Computer
Aided Traffic Control (COMTRAC*), to accurately grasp a significant amount of information, including theoperational status of trains and the utilization status of facilities, control overall transportation services, andmanage their safety.
Moreover, the Shinkansen Second General Control Center has been established in Osaka jointly by JR
West, and is equipped with the same functions as the Shinkansen General Control Center in Tokyo so that

Tsu n ami count er m eas ur es
JR Central defines the area where a tsunami is expected to reach as a “tsunami
hazard expected area”based on the tsunami hazard map of each municipality. When atsunami is expected, first of all, we make arrangements to not allow trains to enter the“tsunami hazard area.”For trains already in the area, we move them out of the area or
guide passengers to a safe place.
In addition, a “tsunami warning sign” has been installed in the area to indicate
the direction of evacuation. We are also taking measures to evacuate quickly bydisplaying the evacuation route to the nearest evacuation center on the tablet terminal
for conventional line train drivers distributed to train crews. Furthermore, to ensurethat these can be practiced, we make sure that all employees are aware of themand conduct evacuation trainings using actual rolling stock in cooperation with local
municipalities and schools.

How ATC works

Tokaido Shinkansen

Conventional Lines

AT S - PT (Aut omat ic T r ain S t op)

Slope protection work

ATS-PT continuously checks the speed for conventional lines
according to the distance between the train and the signal, thecurve, and the points. It ensures safety by automatically applying
emergency brakes when there is a risk that the train will exceed
the safe speed. We have completed the introduction of ATS-PT to
all of our conventional lines.

ATS-PT function
Speed

Brake patterns

Travel curve of train

ATS-PT overview

Consecutively comparing speeds. ・A brake pattern is generated in the
train based on the distance to the
The emergency brakes are
signal derived from information
applied when excessive speed isfrom the grounddetected, regardless of the speed ・The emergency brakes are automaticallySignalapplied to stop trains running at speedsin excess of this pattern by the timethey get to the signal

・Continuous control is performed using
Ground unit (pattern occurrence)brake patterns

Win d pr otect ion
Anemometers are installed in areas where wind is concentrated, such as onmountains and bridges, or where gusts are expected to occur. When the wind velocity
exceeds a certain value, an alarm is automatically issued to the control center, train
station, etc., and as in the case of rain, operation regulations such as suppressing
or slowing down trains are carried out. In addition, due to geographical and otherconditions, some anemometers have an additional function to automatically display astop signal when the wind exceeds the standard.

Tokai General Control Center (Nagoya) / Shizuoka General Control Center / Operation management systems

Anemometer

Measures against rockslides and avalanches
For routes where there is a risk of falling rocks or avalanches, we have installed fallingrock retaining walls, rock cover works, and avalanche retaining walls as protective
equipment. In addition, if a rock fall or an avalanche is detected by a detector, the train
is stopped to prevent accidents.

Falling rock pretaining wall and alarm device

34

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

The operation of our conventional lines is managed by the Tokai General Control Center(in Nagoya) and the Shizuoka General Control Center. In these Control Centers, directors
work in close collaboration using various systems, such as CTC (Centralized Traffic
Control)*, to accurately grasp a significant amount of information, including the operational
status of trains and the utilization status of facilities, control overall transportation services,and manage their safety to support safe and reliable transportation on conventional lines.
※ TC: The CTC system not only remotely and integrally controls station signalingCequipment, etc. in order to efficiently manage train operations, but also has thefunction of conducting real-time monitoring of the operational status of trains.

Tokai General Control Center

Multiple Inspection Train and Track Inspection Train (Dr. Tokai)
We efficiently and thoroughly manage and maintain facilities
with regard to the maintenance of railway tracks and electricalfacilities on conventional lines, using the“Multiple Inspection Train(Dr. Tokai).”Dr. Tokai

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202035

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

SafetyEnsuring Safe and Reliable Transportation■ Safety-Related Data

Initiatives for Ensuring the Safety of Employees
Structure of safety and health management system
Ensuring the safety of employees is also an important issue. At JR Central,
we have established internal regulations based on the Industrial Safety
and Health Act and put in place a safety and health management system.
At our business organizations, etc., safety management officers and healthmanagement officers are appointed, systems are in place to ensure safety
at work and to manage workplace hygiene, and careful safety and healthexaminations are conducted as part of our active efforts to prevent industrial
accidents and improve the work environment. In addition,“safety audits”areperformed to confirm the level of compliance with laws and regulations, etc.,
confirm systems in place to prevent labor accidents that occurred in the past,and confirm the state of implementation of accident prevention measures.

We are also promoting safety and health education throughout theCompany. In addition to conducting the induction course on safety and healthfor all new employees at the General Education Center, we also provide
classroom education on laws and regulations at the General Education Centerand at each site in accordance with the nature, role and level of work, as well
as safety and health education through necessary practical training, including
the use of equipment and tools and simulations of industrial accidents.
Furthermore, we are promoting various activities such as the deploymentof the“movement to explore the nature of safety”and awareness raisingthrough the use of essays for the prevention of train accidents and industrial
accidents.

Status of railway accidents
60

30

50

11

20

1

8

10

2

7

8

24

16

13

10

FY1987

FY2009FY2010FY2011FY2012*Railway operation accidents

300

150

It is important to apply the lessons learned from past train accidents andWe have been holding the All JR Central Safety Promotion Conference yearly since1991. With a view to enhancing cooperation among companies in preventing train

100

oneself”rather than something that has nothing to do with oneself. Sharing theaccidents and industrial accidents, the president and the executive in charge of safety

50experiences of seniors, juniors, and colleagues, as well as ideas and feelings

at our affiliated companies (approximately 150 firms) that play a major role in our0based on those experiences, helps each employee to understand the essence

railway business and the executives of the Company all gather at the conference.
In FY2019, the theme of the conference was“Enhance the ability to execute
through training - You can execute only what you train for -.”In addition to lectures

what we collected in an essay collection titled“Turning Lessons Learned intoby the Company’s executives, case reports were given by the Shinkansen Operations

Assets.”Subsequently in FY2016, we published the second volume of theDivision on“improving emergency response capabilities through comprehensive

essay collection, which is used for group training and workplace education.

Shinkansen accident response training”and by the Conventional Lines Operations

In addition, we have held three recitals in which the writers of essays directly
present the content published in the essay collection, including thoughts that

Division on“technical skills No.1 competition in the Conventional Lines ElectricalEngineering Section and initiatives taken by the Electrical Engineering Department.”

voices of those with experience could convey a strong desire for safety to theoperation systems at Disney”in which he talked about the code of conduct for the14

minds of employees in the audience with a sense of presence and satisfaction.

cast at Tokyo Disney Resort, specific examples of their training, and construction of

12

fire prevention and safety management systems at the resort.

108industrial accidents,

6

and the participating

40

accident prevention

all employees to submit illustrations,posters using items submitted and post
them at relevant internal locations.
In FY2019, we received approximately
45,000 pieces.

36

35

During the Golden Week holidays, the30Year holidays, we set up a“safe transportation

25

period”to carry out comprehensive safety

20

inspections by the president and otherphotographs, and slogans, and we create

executives of the head office. We are also

15

working to further strengthen the safe

10transportation system and further raise
Posters promoting the prevention oftrain accidents and industrial accidents

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

12

12

46

50

218

169

116
116

FY2018

Vehicle/equipment

9
34
9
38

191

Non-railway

8
52
174

FY2019Natural disaster

10
45

3
38
172

186

141

115

107

153

157

128

166

80

126

109

86

114

FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019Fatal accident involving an employee

Accident resulting in employee’s leave from work or more

11

11

6

7
5

9

8

7

6

5

4

FY1987

FY2009FY2010FY2011FY2012FY2013

FY2014

Accident resulting in leave from work or more (affiliated company)

Establishment of safe transportation period during peak season
summer months, and the year-end and New

and industrial accidents, we invite

221

FY2017

Railway crossing accident: A collision between a train or a vehicle and a pedestrian or a
motor vehicle, etc. at a railway crossing.
Railway property damage accident: An accident in which the operation of a train or
vehicle causes damage to property worth 5 million yen or more.

FY2015FY2016FY2017FY2018FY2019efforts.
All JR Central Safety Promotion Conference

for the prevention of train accidents

FY198779

137

FY2016

8
8
1

3
10

2

improve their future

In order to raise employees' awareness

FY20158
1

16

train accidents andof the conference to

Soliciting illustrations, photographs, and slogans related
to accident prevention

4
57
24
55

3
43

6
42

17

Finally, Mr. Shuichi Ishii, former fire prevention officer at Tokyo Disneyland, gave

Reciting the essays (Presenting safety-promoting activities)

FY2014

9

Accident resulting in leave from work or more (JR Central employees)

a special lecture titled,“Dissemination of safety awareness and establishment ofCollection of essays forthe prevention of train
accidents and industrial
accidents

FY2013

1
3
5

Status of industrial accidents (JR Central and its affiliated companies)

executives, attended the recitals that provided an opportunity in which thecompanies make use

6

13*Transport disruption refers to cases that are not railway operation accidents, but those involved suspending operation of a train or those where a passenger train was delayed for 30 minutes or more(one hour or more for non-passenger trains).

were not written in the essay. More than 300 employees, including company

Through this conference, we reconfirm the importance of efforts to prevent

4
26

200

industrial accidents to our own actions as“something that can happen tofrom employees based on their experiences as railway workers and compiled

6

Railway attendant

7
43

250

5

8

Status of transport disruptions

350

of safety. Based on this view, in FY2014, we solicited ideas and initiatives

6

Train accidents: Train collision, derailment, and fire accidents
Railway accident involving personal injury: An accident in which aperson was killed or injured by the operation of a train or vehicle.

450

All JR Central Safety Promotion Conference

Railroad property damage accident

2400“Essaysfor the prevention of train accidents andindustrial accidents”

Train accident involving personal injury

40

Movement to explore the nature of safety
rules and basic actions with the three key phrases of“Why?”,“What will
happen?”, and“What should I do?”in various aspects of daily work, on
top of education, training, and study sessions held at each of our field
offices. This initiative has been expanded also to our affiliated companies
to further deepen the activity.

Railway crossing accident

500When we examine the causes of handling errors and labor accidents
that have occurred in the past, we find that many such cases are caused
by insufficient understanding of rules and basic actions. Therefore,
since FY2013, the Company has been promoting the“movement to
explore the nature of safety”as a company-wide effort. This movement
encourages employees to think about and understand the essence ofTrain accident

employees’awareness for safety throughmeasures such as the establishment of the
Safe Transportation Response Headquarters.

36

Accident resulting in aﬃliated company employee’s leave from work or more
Fatal accident involving an employee of aﬃliated company

32
24

27

25

20

30

27

24

23

19

20

5

Comprehensive safety inspection

0

4
FY19872

FY2009FY2010FY2011

1

FY2012

1

FY2013

2

FY2014FY2015FY2016FY2017FY20181

FY2019CENTRAL JAPAN RAILWAY COMPANY Annual Report 202037

SocialBusiness Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

SocialSocialIntroducing New Shinkansen Rolling Stock N700S

Further Enhancing
Transportation Services“12 Nozomi Timetable”expected to significantly improve our services
When the Company was established in 1987, we were operating
the Tokaido Shinkansen at a maximum speed of 220 km/h. Since
then, we have continued to work on enhancing our transportation
services on the Tokaido Shinkansen. We put the Series 300“Nozomi”into operation in 1992 with a maximum speed of
270 km/h, and then opened Shinagawa Station and replaced
all trains with the Series 300 trains in 2003, allowing us to shift
to a Nozomi-centered timetable. This timetable also underwent
successive improvements to fulfill the needs of customers.
Then, in 2015, the speed of the Tokaido Shinkansen increased
for the first time in 23 years, reaching a top speed of 285 km/h.
Series 700 retired in the spring of 2020, and we completed the
update to the N700A type* to allow all trains to run at the same
highest speed of 285 km/h. We also finished improvements toequipment and introduced the “12 Nozomi Timetable” in March
2020.

W i t h t h e “ 1 2 N o z o m i T i m e t a b l e ”, t h e m a x i m u m n u m b e r o f“Nozomi”services per hour increased by 2 from 10 to 12 in either
direction, and“Nozomi”is now operated at an average interval of
5 minutes during busy hours.
Also, under the “12 Nozomi Timetable,” all “Nozomi” services
will travel between Tokyo and Shin-Osaka within 2 hours 30
minutes. Figure 1
With this“12 Nozomi Timetable,”additional“Nozomi”services
will be provided during busy hours. Passengers can reduce theirtravel time by reserving train seats online at their convenienceand using the new, faster “Nozomi.” This has made the Tokaido
Shinkansen even more convenient.

*Generic name of Series N700 and N700A and later reflecting the main functions adopted in N700A.

Number of services and passenger volume of the Tokaido
Shinkansen (per day)1

Maximum number of the fastest train, “Nozomi” one way per hour

Nozomi

Tokaido Shinkansen Passenger volume (FY1987=100)

KodamaHikariThe N700S, new Shinkansen rolling stock, is designed basedon the results of years of technological development, and isequipped with features such as enhanced safety and stability,
higher emergency response capability, enhanced comfort andconvenience, and a standardized design that can easily beconstituted to any length of trainsets.
Based on the results of the test runs of the N700S test train,
we determined the mass production specifications for the rollingstock that will replace the Series N700A type trains in FY2020,
developed a launch plan as shown below, and began the service
with N700S in July 2020.

Launch Plan
Fiscal Year

2020

2021

2022

Total

Number of trainsets

12

14

14

40

N700S
Main features of the N700S

Enhanc ed saf ety
and stabil ity

H igher emer genc yr esponse c apabil ity

Enhanc ed c omf or t
and c onvenienc e

Lower running cost

● Shorter braking distance in the event of an● Battery-based self-propelled system Figure 4● E quipped with a fully active damping● Reduced power consumption Figure 3

earthquake Figure 2● Enhanced snow-resistant features● Enhanced intercom functions● Enhanced status monitoring function● Toilet functions during power outage

Figure 2(Index)

164

160

143
140

128 129137
126 124

118

120

121

123

127 126

122 120 122

100
252
80

260

231 239271 276 273 270 271 274 274 271 269 269 271 272 275
0

5

34

34

35

37

41

45

50

51

61

70

157

480

16%

6

▲ %

270

285

285

Series 700

N700A type

N700S

km/h

342
341 336334
333 336

350

358

378
365 368 373

12

360

10

Series 700

N700A type

N700S

The braking distance during an earthquake is 5%
shorter than the N700A type thanks to an improved
ATC and brake system.

300

9Figure 4

8

240

7

▲

km/h

km/h

152

133 134290

101 145 166 170 175

Reduced power consumption▲25% ▲5%(Trains/day)

161

159

Figure 3

420

130

319
311 314

100

142

141

138

125 123 126
130

111

148

● Reduced inspection/repair work

● Additional outlets for mobile devicess

Shorter braking distance in the event of an earthquake (at 285 km/h)*The total number of services may not match the sum of each train service due to rounding.

169

control system● Additional security cameras

187 193 188 185 188 194 201

Employing the Dual Supreme Wing design that reduces air
resistance and a drive system that uses next-generation
silicon carbide semiconductors, the N700S consumes 6%
less electricity than the N700A type.

Battery-based self-propelled system

Tunnel209 217 220 226 230

60

180

143 150 165 176 187 189 158 157 158 158 155 148 139 138 130 122
40

120

93

3
20

0

89

88

87

84

84

82

81

80

87

88

89

90

91

92

93

94

1

65

65

64

64

66

66

66

66

66

65

65

65

65

65

65

65

2

60

79

78

78

78

80

80

80

79

80

80

80

80

80

81

82

82

82

82

83

83

83

83

83

83

83

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

16

17

18

19

“Nozomi”(the Series 300) began commercial operation “Express Reservation”was launched
Shinagawa Shinkansen Station opened and all trains at max. 270 km/h

(FY)

0

Shin-Osaka Station improvement work completed “smartEX”was launched
Uniﬁed N700A type rolling stock and all trains at max. 285 km/h

Maximum number of the fastest train,“Nozomi”one way per hour
Note 1. Departures shown include extra trains.
Note 2. Usage status is shown by means of an index with the sectionaltransportation volume for FY1987 as 100.
Note 3. Station stops Nozomi: Shinagawa, Shin-Yokohama, Nagoya, and Kyoto;
Hikari: Same as“Nozomi”, plus a few additional stations; Kodama: All
Figure 1 Travel Time of“Nozomi”between Tokyo and Shin-Osaka
stations
Note 4. The sum of figures for“Nozomi”,“Hikari”and“Kodama”may not agree
Previous timetable
New timetablewith the total due to rounding.

38

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Within 2 hr 30 min

3trains

12trains

2 hr 33 to 37 min

7trainsNone

The N700S is the ﬁrst high-speed train equipped with a battery-based self-propelled system. It can travel to a location where passengers can safely
evacuate in the event of a long power outage following a natural disaster, etc.

Conventional Lines: Development of next-generation HC85 seriesWith an eye toward the replacement of diesel railcars currently
used for our limited express trains “Hida” and “Nanki”, we willproceed with the development of the next-generation limited expressrolling stock“HC85 series”that adopts a hybrid power generation
method, which is the first of such type for JR Central. We are aiming
to put this hybrid powered rolling stock into commercial operation
with a top speed of 120 km/h without compromising safety andcomfort. We are considering launching the operation of massproduced hybrid powered rolling stock by around FY2022.
The hybrid powered method utilizes a combination of power
generated by the engine and the power stored in a storage battery
during braking, etc., to rotate the motor for running the train. By
adopting this method, we do not need the rotary components unique
to diesel railcars and can achieve increased safety and reliability.

In terms of comfort, we can improve quietness and comfort by nothaving to make the gear changes unique to diesel railcars, reducing
the number of engines, etc. In addition to the hybrid powered rollingstock, we will also introduce new technologies to further enhancesafety, such as a new onepiece cast truck frame,
vibration detectors, anddata communications
between trains and wayside.

Next-generation HC85 series (testing vehicle)

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

39

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

SocialFurther Enhancing Transportation Services

Promoting Online Reservation and Ticketless Boarding Services

Stimulating Tourist Demand

Shifts in usage of online reservation services

In an effort to have customers more conveniently use theTokaido Shinkansen, JR Central takes initiatives to promote
greater use of online reservation and ticketless boarding services
via“EX Service”“( Express Reservation”and“smartEX”).
For customers who frequently ride the Shinkansen for businessor other reasons, we provide the “Express Reservation” service
that offers a discounted member price throughout the year.
Members of the service can smoothly ride the Shinkansen bysimply touching their member IC card at the automatic ticketinggates after reserving their preferred seats with a smartphone orother device beforehand. There is no need to stop at the ticket
co u n t e r o f a s t a t i on , w h ich al l o w s cu s t o m e r s t o s i g n i f i can tl y
reduce the total transit time, plus potentially apply for the“Green Program”(not applicable for some members) that allows
customers to utilize the points accumulated based on their usageof the Shinkansen to take a seat in a Green Car at the price ofthe reserved seat in a regular car. In addition, reservations canbe changed as many times as necessary before departure without
any handling fees, allowing customers to use the service without
worries even if there are sudden schedule changes.
We also offer“smartEX”with no membership fee for customers
who only occasionally use the Shinkansen, including people
traveling to visit their hometowns, tourists, and foreigners visiting
Japan, so that they can also use the convenient online reservation& ticketless boarding service. This ticketless service enables
customers to immediately use the service by simply registering
their credit card and the nationwide interoperable transportation
IC card from their smartphone, etc. As a result, we offer greater
convenience for even more customers.
At the moment, reservations for reserved seats using thesese rvic es curr entl y acco un t for app rox im at ely o ve r 40% of allreservations.

Number of“Express
Reservation”members(10,000 persons)

Number of persons
registered to“smartEX”

377

750
700
650
600
550

Over 40% of reserved seats arebooked online (FY2019)

226

500
450

72

400
350
300
250

266

315

289

339

365

387

200
150
100
50
0

’15.3

’16.3

’17.3

’18.3

’19.3

’20.3

Illustration of using“smartEX”

1. Register

2. BookCommuting type IC card②③

QR code-based ticketless boarding
service for visitors to Japan

Ticketless boarding service for agroup of people traveling together

Reserved seat reservation/change
service for delayed trains

We are preparing to launch a ticketlessboarding service using a “QR code”* sothat visitors to Japan who do not havetransportation IC cards can use the ticketlessboarding service. By tapping the QR code
displayed on a smartphone or other device
to the ticket gate, customers can benefit
from the convenience of ticketless boarding.

Under the current EX Service, when afamily or two or more persons traveling
together make a reservation, they are
asked to pick up their tickets for boarding.
From the spring of 2021, however, if thetransportation IC cards of people traveling
together are registered at the time ofmaking a reservation, everyone in thegroup can use the transportation IC cardfor ticketless boarding.

If a train has not left the station after thescheduled departure time, customers can use
the EX Service to book a new reserved seaton that train or change from a reserved seaton another train. At the same time, we will
introduce a push notification service wherein the event a train booked with“EX App”
is expected to be delayed approximately
10 minutes or more, we will send out anotification approximately 1 hour before thescheduled departure time at the station where
the customer is to board.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

For customers using the EX Service, we are expanding tourist
products that offer the use of the Shinkansen at discounted
prices when customers plan ahead for sightseeing and otherpurposes.
For example, by launching various products, such as “EX
Nozomi Family Hayatoku”and other services that offer a discountfor family or friends traveling together using the Shinkansen,
although the travel dates, number of seats, sections of travel andhours of boarding may be limited, we are stimulating demandfor Shinkansen use. In addition, we are working to stimulate awide range of demand by enhancing convenient benefits that are
useful when traveling.

“5 0 + (Fif t y Pl us)” T ra vel Pla n

Kyoto Campaign (Autumn version, Shinnyodo)“* QR code”is a registered trademark of DENSO WAVE INCORPORATED.

40

 nhanc ement of T ou ri st Products for theE
U ser s of “EX S er vic e”

Given the aging population in Japan, the senior age group,
which is said to have more leisure time and disposable income
than other age groups, is growing. We expanded the target
group to include persons aged 50 and above, and have been
operating a travel club“50+”, which anyone over 50 years old
can participate in. The number of members as of the end of
FY2019 totaled approximately 990,000 members of which a
total of approximately 140,000 members enjoyed“50+”brandproducts in FY2019.
We not only inform the members of seasonal tourism
information through the magazine and the website but also offer
affordable travel products that use the Tokaido Shinkansen.

Tap!

Creditcard

In the spring of 2021, we plan to introduce a service that will make using the EX Service even more convenient.

Furthermore, we are aiming to extend the service area of the
EX Service to the Kyushu Shinkansen (Hakata - Kagoshima-Chuo
section) in the spring of 2022.
By implementing these initiatives, we will further increase
the convenience of our EX Service and make online booking &ticketless boarding the norm for Tokaido Shinkansen passengers.
In addition, we will concentrate on developing more user-friendly
and efficient sales systems ahead of the opening of the Chuo
Shinkansen.

We have continuously implemented travel campaigns, such as
the Kyoto Campaign for Kyoto and Nara, which are the largest
and most sustainable tourist resources in our market area, andwe are promoting the use of the Shinkansen mainly from theTokyo Metropolitan area to the Kansai region. In particular, we
run promotional advertisements for the“Kyoto Campaign”basedon a concept of enabling customers to re-acknowledge Japanese
beauty and profundity.
In our“Tokyo Bookmark Campaign”to promote the use of the
Shinkansen to visit Tokyo from the Kansai and Chukyo areas, we
also introduce tourism information about Tokyo, travel items,
etc., on the website.
In July 2020, we launched the“Shinkansen for a long-awaitedtrip! Make traveling more fun with small shifts”campaign that
proposes a new way of traveling by“shifting”from the“standard”
in terms of time, location, means of travel, action, etc.
IIn addition, we are working on coming up with attractive
products associated with Shizuoka, Aichi, Hida, Ise-Shima andother locations.

3. Board

Further Enhancing Our EX Service①

D epl oyment of T our ism Campaigns

Ef f or t s t ow ar d For eign T our ist s
As the“smartEX”service for foreign visitors to Japan, we offer
the“Tokaido Sanyo Shinkansen Internet Reservation Service”via
the English-version website and a dedicated smartphone app.*
This allows visitors from various countries and regions aroundthe world to book a train before they leave their home country,
enhancing the convenience and user-friendliness of using theTokaido and Sanyo Shinkansen.
As to our travel products, working in cooperation withmunicipalities located along our train lines and othertransportation companies, we offer sightseeing value tickets
covering destinations that are popular among international
tourists, such as“Takayama and Hokuriku.”We also have tour
packages for the Tokaido Shinkansen combined with day trip
excursion tickets to destinations we serve, such as FLEX JAPAN,
which is a package that comes with a roundtrip Shinkansen
ticket, accommodation, and local sightseeing.
To capture travel demand, we are promoting the attractivenessof Japan by operating the “Central Japan Shinkansen/Train
Portal,”which offers a collection of products designed for visitors
to Japan. In addition, for both domestic customers and visitors
to Japan, we are working in cooperation with municipalities andtourism associations located along the Tokaido Shinkansen Linein launching campaigns to publicize the attractiveness of tourism
along the line as a way of stimulating travel demand together

with local communities.
In addition to these initiatives, we are making efforts tobe better at providing information to travelers by making
announcements via tablets and other devices, offering extensive
train status information on our corporate website, providing
information by adopting station numbering, and also offering free
Wi-Fi service at stations and in the Tokaido Shinkansen, Express
Hida and Nanki trains. The service is currently available at all
Shinkansen stations and 27 conventional line stations that are
frequently used by international travelers, as well as on all carsof the Tokaido Shinkansen and Express Hida and Nanki rollingstock.
*As of June 30, 2020, the service is available in eight countries and regions.

Central Japan Shinkansen/Train Portal

QR code-based ticketless boarding
service

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202041

SocialBusiness Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

SocialSocialDevelopment of Nagoya Station boasting the highest number of passengers among our stations

Deployment ofAffiliated Businesses

The development of Nagoya Station, which boasts an average
220,000 passengers per day, the highest number of passengers of
any our stations, forms a pillar of our affiliated businesses.
At Nagoya Station, we opened JR Central Towers (hereinafter,“Towers”) right above the station in 2000 and then opened JR
Gate Tower (hereinafter, “Gate Tower”) adjacent to the Towers

in 2017. We will continue to operate Towers and Gate Tower
in a uniform manner and take initiatives to maximize profits bydemonstrating synergistic e ffe c ts th r o u g h c le a r ly s e g r e g a tin g
the concepts of businesses of both facilities and promoting
collaboration in sales to increase earnings while pursuing efficientmanagement.

Uniform management of JR Central Towers and JR Gate Tower
J R Cent r al T ow er s
Towers, the skyscraper complex with a height of 245 meters and a total
floor area of approximately 417,000 m2, built right above Nagoya Station,is the core of our affiliated businesses. Our three consolidated subsidiaries
run a department store, a hotel, and offices. Ever since the opening of the
facility, earnings of our affiliated businesses increased significantly. Figure 1

The office business has enjoyed a high occupancy rate since its launch.
All office spaces were almost fully occupied in the year ended March 2020.
This fiscal year, we will commence office renovation work and implement
other initiatives that will enable us to gain a leg up in this market over thelong run.
JR Nagoya Takashimaya, ideally located directly above the Nagoya
station, attracts large numbers of visitors. In February 2020, we completed
a large-scale renovation that approximately doubled the floor space of thecosmetics section and we are working to increase sales by attracting newcustomers.
Nagoya Marriott Associa Hotel is rated highly for its convenient location
directly above the station, its spectacular view from the top floors, andupscale facilities, etc. Last fiscal
year, we completed the relocationand expansion of the concierge
lounge and the renewal of theChinese restaurant“Linka.”We arealso sequentially renovating guest
rooms to further enhance ourcompetitiveness.

Linka

J R G at e T ow er

JR Central Towers (center/right) and JR Gate Tower

JR Central Group’s affiliated business
The JR Central Group undertakes businesses in the areas ofTransportation, Merchandise and Other, Real Estate, and Other.
The Transportation segment involves railway and bus businesses.
The Merchandise and Other segment manages department
stores and provides sales services for goods and food in stations
and trains, utilizing the merit of having good railway station
locations to attract customers. The Real Estate segment develops
Figure 1

Shifts in the Operating Revenues of Consolidated
Subsidiaries (simply aggregated)(Billion yen)commercial facilities in stations and areas under elevated tracks,
and also leases real estate such as station buildings. In the Other
segment, we manage hotels, travel agencies, and advertising
agencies, etc. We also manufacture rolling stock and maintain,
inspect, and repair our railway facilities in this segment.
Operating revenues of consolidated subsidiaries, excluding JR
Central, totaled 636.6 billion yen (simply aggregated) in FY2019.
Transportation

Merchandise and Other

Real Estate

636.6

630.1
617.1 （29companies）（29companies）（29companies）

582.9
569.6 （29companies）
556.1 557.7 （28companies）

6,000

5,000

462.4

（29companies）（29companies）
528.6
525.9
511.2 （29companies）
507.3 （31 companies）（29518.1
companies）（29companies）（31 companies）

14.2

267.1

（30 companies）

436.2
410.5 （30 companies）

Other

385.0 （30 companies）
369.3 382.0
companies（30） companies）
355.6（29 companies（29
）

4,000

335.0 （30 companies）（30 companies）

77.5

3,000

210.1

（19 .ompanies）

2,000

277.7
1,000

52.6

（3 companies)

0

’90.3

’00.3 ’01.3 ’02.3 ’03.3 ’04.3 ’05.3 ’06.3 ’07.3 ’08.3 ’09.3 ’10.3 ’11.3 ’12.3 ’13.3 ’14.3 ’15.3 ’16.3 ’17.3 ’18.3 ’19.3’20.3

Note: Each figure in parentheses indicates the number of consolidated subsidiaries at the end of FY.

42

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

JR Gate Tower is a high-rise complex building with a height ofapproximately 220 m and a total floor area of approximately 260,000 m2
that stands adjacent to JR Central Towers and consists of commercial
facilities, a hotel, offices, etc.
The office spaces are almost fully occupied due to their prime location
directly above Nagoya Station, which the Chuo Shinkansen will serve inthe future.
Housing about 160 fashion stores, Takashimaya Gate Tower Malloffers products in categories and price ranges not found in the adjacentdepartment store.
Nagoya JR Gate Tower Hotel, together with Nagoya Marriott Associa
Hotel, is highly regarded by a wide range of guests as a hotel that focuses
mainly on accommodation, offering both comfort and functionality.
JR Gate Tower also houses an electronics retail store, clothing stores,

etc., in addition to a dining zone. When combined with JR Central
Towers’restaurant floors, it is
one of the largest collections ofrestaurants under one roof in theentire country.
By integrating the management
and operation of the entire
building with Towers, we are
pursuing efficient management as
the JR Central Group. In addition,
Gate Tower has added newcontent not found in the Towers,
further enhancing the attractiveness Takashimaya Gate Tower Mallof the two buildings.

Efforts to develop commercial facilities at stations
In addition to the development of Nagoya Station as described above,
we operate commercial facilities using spaces inside stations and underelevated tracks within our service area as well as engage in real estate
and related businesses using former company housing sites.
In FY2019, we increased the floor space of“ASTY SHIZUOKA East
Building”in Shizuoka Station and added 6 new restaurants, including
a seafood izakaya (Japanese-style pub) where you can enjoy seafoodfrom Suruga Bay and a tempura bar that serves dishes using local
ingredients. As a result, we opened a dining zone with a total of
10 Shizuoka gourmet restaurants. In addition, we renovated thecommercial facilities at Ogaki Station and Mikawa-Anjo Station to housetenants in line with the regional characteristics and meet the needs of awide range of customers.
In FY2020, we doubled the size of the Yaesu North Exit commercial
area of the“First Avenue Tokyo Station”on the Tokyo Station premises,
and opened“TOKYO GIFT PALETTE”a specialty souvenir and gift shop
zone that features newly developed products, new business formats,and popular brands including those opening their first store at Tokyo
Station. We also opened“HIBIYA GOURMET ZONE,”housing popular
restaurants in the space under the historic brick arch viaduct between
Yurakucho and Shimbashi Station. In addition, we carried out large-scalerenovations of the Toyohashi Station Building“Kalmia”in time for the
50-year anniversary of the opening of the station building. Furthermore,
we introduced restaurants in certain areas of “ASTY SHIZUOKAWest Building”to also meet take-out demand and enhanced theattractiveness of the facilities by strengthening the restaurant business.
In the real estate business, we carried out commercial development
and residential land sales utilizing former company housing sites in
FY2019.
We will continue to promote these initiatives to further improve
profitability and competitiveness.

TOKYO GIFT PALETTE
CENTRAL JAPAN RAILWAY COMPANY Annual Report 202043

SocialBusiness Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

SocialSocialHuman Resources Development

Initiatives for Enhancing the Skills of Employees
On-the-job training (OJT)Support for self-betterment

We offer various types of on-the-job training (OJT) in each
workplace. For example, under the N-OJT program provided for
employees in younger generations to attain specialized knowledge
and technical skills, we take a fine-tuned approach in developing
employees by using a“List”, which indicates the requirements needed
to be regarded as being qualified level, and a“Chart”for recording
each individual’s development plan, details of guidance, and results of
guidance.

With regard to promoting“self-betterment,”we are also enhancing
various support systems and actively supporting the development of
the skills of motivated employees. As internal training programs, weoffer approximately 30 courses to employees of JR Central, its groupcompanies, etc., with many employees taking these courses every
year.
Our license incentive program supports approximately 200 types oflicenses, and more than 1,000 employees obtain licenses using thissystem every year.

Group training

Initiatives for Enhancing the ICT Literacy of Employees

For employees in managerial positions, we provide training on
methods to maximize the performance of the workplace and teams
by bringing out the strengths and abilities of each staff member.
For mid-level employees, for example, we provide selective training
programs that last for about 2 months, such as“leader training,”“middle-leader training,”and“forerunner training,”to develop future
leaders. We also use actual equipment, such as the Shinkansen rollingstock, installed at the General Education Center and conduct practicaltraining in accordance with job functions and levels to improve thetechnical skills of employees.
For new employees, we provide new employee training thatruns for about one to two months after they enter the Company.
We recognize this training as an “important opportunity for new
employees to shift their awareness from being a student to a JR
Central employee” and implement a curriculum that instills thediscipline and norms required of employees of JR Central and theawareness that safety is the top priority.

In our new employee training and stratified training, we provide
education and opportunities for enlightenment regarding ICT as wellas support the acquisition of ICT-related licenses through promoting
self-betterment.
In addition to improving ICT literacy, we are also providing
training that has high educational effect by actively utilizing digitaltechnologies. For example, in some training programs, on top ofproviding education utilizing desktop training and simulators, we
use training materials, etc., with VR technology to have participants
deepen their understanding of the significance and essence of thecontent. In addition, we project images of underfloor equipment takenwith 360-degree cameras when explaining the structure of rollingstock to new employees. Explaining the underfloor equipment fromvarious angles is part of our initiatives to improve the understandingof new employees who have never seen the actual vehicle.

General Education Center

Policy on Human Resources
JR Central views its employees as its greatest management resource. Many
railway technologies can only be built up to a high level through accumulated
experience, and human resources development cannot be achieved overnight.
In addition, the railway business can be operated only when a large number of
employees work together as a team. We believe that long-term employment
is useful at JR Central also from the perspective that maintaining trusting
relationships among employees is important.
Based on this concept, we have established a personnel and wage systemthat rewards employees who make efforts more appropriately, while assuming
long-term employment in order to enable employees to attain the necessary
abilities and demonstrate their abilities with enthusiasm. We are also working
to systematically develop human resources with a broad perspective on
personnel management.
In April 2020, in view of changes in the employment environment associatedwith the declining birthrate and changes in the social situation surrounding
the employment of the elderly, we revised our personnel and wage system toenable employees aged 60 or older with a wealth of work experience to use
their accumulated skills and experience to fully demonstrate their abilities tothe age of 65, and extended the retirement age from 60 to 65.
In addition, we have introduced a system under which employees aged
65 or older who are highly motivated and capable are employed as senior
contract employees until the age of 70.
Our Basic Policy on Human Resources Development is based on threefundamental principles: discipline, technical capability, and sense of unity.
Given these three fundamental principles, we develop human resources that
undertake the businesses of the Company. The basic education system mainly
involves on-the-job training (OJT), in which employees learn the knowledge
and skills required for work through daily operations in each workplace. They
also acquire additional knowledge and skills through group training, which
is held in the General Education Center, etc., and various self-betterment

44

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

opportunities, such as internal and external training programs, etc., that help
employees learn knowledge and skills on their own.
As a result of these continuous efforts, the Company’s employee turnoverrate is 1% for men and 4% for women, resulting in around 1% in total. This isremarkably low compared to the level of society in general, and we believe
this is one of JR Central's strengths.
*According to the statistics of the Ministry of Health, Labour and Welfare
in 2017, the average turnover rate in society was 7% for men and 11% forwomen, for a total of 8%.

Basic Policy on Human
Resources Development

Scene of group training

Scene of VR training“One STEP”activities

Discipline

Technical
capability

Sense ofunity

We promote“One STEP”activities in which multiple employees
work together as a team to discuss various issues in the workplacewith a sense of ownership and resolve and improve the issues
with their own creativity and originality. The name of this program“One STEP”reflects the idea that“one step made together by ten
persons is better than ten steps made by just one person.”Throughimplementing activities on a wide range of themes, such as service
improvement, safety enhancement, and cost reduction, we aim
to improve the skills of employees, create a rewarding and lively
workplace, strengthen the physical strength of the workplace, anddevelop the Company.

Scene of One STEP activity

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

45

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

SocialHuman Resources Development

Promotion of Diversity

Initiatives for Employment of Persons with Disabilities

At JR Central, we believe that it is extremely important from theperspective of management to employ diverse human resources andmaximize their capabilities to drive corporate growth.
With this in mind, in our recruitment process we carry out employment
without making distinctions in terms of gender, nationality, etc., and arealso actively hiring persons with disabilities.
From the perspective of women's empowerment, in accordance withthe provisions of the Act on Securing, Etc. of Equal Opportunity andTreatment between Men and Women in Employment (Equal Employment
Opportunity Act) and other relevant laws, we handle personnel matters,
including recruitment and assignments, in a fair and equal manner without
distinction between men and women. Currently, female employees
are engaged in a wide range of duties, including administrative work,
station front desk work, conductors and drivers of the Shinkansen andconventional lines, and hospital nursing work.
Due to the characteristics of the work involved, the railway business

requires so-called late-night work (work between 10 p.m. and 5a.m.). However, the Labor Standards Act at the time of the Company's
establishment prohibited late-night work by women in principle,
excluding some job types. Due to this situation, the ratio of female
employees as of the end of FY1996 was only 1.3%.
Subsequently, in response to the revision of the Labor Standards Act
in 1997, we have actively employed female employees. As of the endof FY2019, the number of female employees was approximately 2,000(approximately 11% of all employees), reflecting a significant increase.
Our action plan based on the Act on the Promotion of Female
Participation and Career Advancement in the Workplace is available on
our website.
We are working to improve the working environment by enabling
diverse and flexible working styles in terms of systems and improving
facilities so that diverse human resources can work with peace of mind
and fully demonstrate their abilities.

Support for Maintaining Balance between Childcare, Nursing Care, and Work
JR Central has been actively making efforts to enhance various
programs so that employees, regardless of gender, can maintain a goodbalance between work and home, and be motivated to work withenthusiasm in active roles over many years. In 2006, JR Central became
the first company in the transport and railway industry to receive the“Minister of Health, Labour and Welfare Effort Award”as a Family
Friendly Corporation*1. We have continued to make further efforts evenafter receiving the award and many of our programs greatly exceed thelevel required by law.
For example, at JR Central, employees are entitled to longer maternity,childcare, and nursing care leave than the statutory periods set. We
are currently taking specific measures to maintain and increase thepercentage of employees who take childcare leave by setting targets.*2
In FY2018, the percentage of employees who took childcare leave was
100% for female employees and 14.69% for male employees.
We use flexible work arrangements, including flex time for office
workers and reduced work days, which allows field office employees who
provide care to a child in the third grade of elementary school or younger
to take multiple unpaid leave days each month, all with an eye to helping

Childbirth

JR Central currently complies with the various laws and regulations,
including the Labor Union Act, and has signed labor agreements withall four labor unions currently in place. We hold joint management
council meetings and engage in collective bargaining based on theselabor agreements, and will continue to strive to build healthy andstable labor management relations.

*1 A system introduced by the Ministry of Health, Labour and Welfare in which companies are
rewarded for taking initiatives to establish various programs to support employees in achieving agood balance between work, childcare and nursing care, and for putting in place a mechanism inwhich employees have the option of selecting diverse, flexible working styles.
*2 JR Central formulated a five-year action plan from FY2016 to FY2020. Under this action plan, we
set targets on childcare leave, including 100% of female employees to take childcare leave, and
3% or more of male employees to take childcare leave. Given that we achieved the targets set inour action plan for the period from FY2005 to FY2014, we were certified by the Minister of Health,Labour and Welfare as a Childcare Support Company.

JR Central operates on the basis of respect for human rights,
and we believe that enhancing employees’awareness of andsensitivity to human rights is important also from the perspectiveof fulfilling our corporate social responsibility. Based on thisphilosophy, we have set up human rights awareness officesin the Administration Department as well as in each of ourrailway business operations divisions and regional offices, andsystematically implement human rights awareness education,

３years old

Related to the Equal Employment Opportunity Act

Working restrictions on pregnant womenChildbirth leave
Related to the Act on Childcare Leave, Wage
Caregiver Leave, and Other Measures for
the Welfare of Workers Caring for Children
or Other Family Members

Percentage of all employees covered by collective bargaining
agreements (Non-consolidated, as of April 1, 2020)
Number of union members Total number of employees*

17,266

18,242

Ratio

94.60%*Excluding newly hired employees still in the probation period

Promoting Human Rights Awarenessmainly for managers who provide employees with guidance daily,
in an effort to promote understanding of diversity. In addition, we
have in place a system for ensuring fair and honest recruitment,
appointing human rights, promotion members who oversee that
we conduct recruitment activities with an awareness of humanrights.

Enrollment
in elementary
school

1st grade &6 months
in elementary
school9years old

Related to the Labor Standards Act

Childcare leave（paid）
Childcare leave
Reduction of scheduled working hours
Restriction on overtime/late-night work
Exemption from overtime work
Nursing leave （unpaid）
Late-night work relaxation system
Shorter day leave（unpaid）
Child dependency allowance（up to 22 years old）
Provision of at least 30% of the year-end
bonus even during childcare leave

The Company bears the social insurance premium deducted fromthe year-end bonus in line with the period of childbirth/childcare leave

Welfareassociation

46

A workplace scene

Initiatives beyond that called for by law, or voluntary initiatives

１year old

Check-up/maternity leave (unpaid)

policy in recruitment and hiring as well as continue to improve thework environment in an appropriate manner while taking into accountrestrictions due to disabilities so that individuals with disabilities canmake the most of
their skills evenafter they are hired.

Healthy Labor-Management Relations

employees maintain a healthy work-life balance. We also have a wide
range of employee benefits, such as mediating the use of companyled childcare centers and offering childcare support subsidies whenemployees use babysitters, etc., which are used by many employees.
In addition to these programs, we have a system designed to rehire
former employees who resigned for childcare or nursing care reasons or
due to other similar circumstances, as long as a certain set of conditions
is met. We also have a system that allows an employee whose work
location is limited to be transferred, upon request, to an area outside
the current area of work. These measures are all part of our efforts tocreate a better work environment where employees can reach their fullpotential at different life stages.

Initiatives for supporting childcare, etc.
Pregnancy

JR Central is actively promoting the employment of persons
with disabilities from the perspective of utilizing diverse humanresources and fulfilling its corporate social responsibility. We
place the right people in the right positions in a wide range
of departments, including the administrative and operational
departments, while giving consideration to the degree of individual
disabilities and other factors.
In October 2006, the Company established a special subsidiary,
JR Tokai Well Co., Ltd. based on the Act on Employment
Promotion etc. of Persons with Disabilities. The special subsidiary
mainly engages in printing and envelope sealing operations for the
JR Central Group.
As a result of these efforts, the employment rate of disabled
persons as of June 1, 2019, was 2.51%, which is higher than thestatutory employment rate.
In accordance with the revised Act on Employment Promotion etc.
of Persons with Disabilities, we will adhere to our non-discrimination

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Home help usage subsidy: Up to 5,000 yen/day (up to 20 days per year)（no age limit）
Childcare support subsidy; Up to 4,000 yen/day (up to 60 days per year)
Preschool center usage subsidy: 5,000 yen/month

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

47

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

SocialHuman Resources Development■ Human Resources-Related Data

Enhancing Health and Productivity Management
Purposes

Organization

In order to achieve our mission“Contribute to the development ofJapan’
s main transportation artery and social infrastructure”shown in
our management philosophy, it is essential that each and every employee
demonstrates their full potential. In order to maintain and promote mental
and physical health as its basis, we established the Health Promotion Policy
as our overall policy for health promotion measures in April 2018 for theCompany to actively support the promotion of employees’health.

Headed by the officer in charge of personnel affairs, health andproductivity management is being enhanced through cooperation among
the Personnel Department, the Company-managed medical institute(Nagoya Central Hospital), and the occupational health sector (HealthCare Center).
The Health Care Center has health management offices at Tokyo,
Shizuoka, Nagoya, and Shin-Osaka, and assigns occupational physicians,
public health nurses, nurses, clinical psychologists, and other medical
professionals at all of those four locations.
In addition, health promotion staff have been designated at each
workplace to support the development of frameworks for employees
to work in a lively way and employees’and workplaces’voluntary
promotion of health.

“Health Promotion Policy”:

For Working in a Lively and Continuous Way
1 The Company shall establish frameworks for employees

Employees should promote their own health. The
Company shall support it.

3

We verify the effect of those efforts and further promotehealth based on objective data that help us understandthe status of workplaces and employees.

Total number of employees (non-consolidated)
Percentage of female employees（Number of persons）

（％）

12.0

20,00018,054

18,11618,14815,00018,282
11.5

11.2
10,000

1,000

700
600

11.0

10.9

11.0

500
400

10.7
5,000

10.5

0

10.0

2015

2016

2017

2018

2019

Number of days of annual paid leave taken
Percentage of annual paid leave taken（Number of days）

（％）

100

18

Habituation of exercise
We are holding the following events to improve the awareness of healthpromotion and support habituation of exercise.

16

Central Physical Challenge(Sport event)Centered on the measurement of physicalfitness age, this event provides fun opportunities
to promote health including competitions
among workplaces and special programs inwhich family members can participate.

79.9

82

78.9

87.6

85

90
80

14

70

12

60

10

50

8

●J R

538

554

15.5

15.3

15.9

16.5

16.9

40

6

30

4

20

2

10

0

0

2015

2016

2017

2018

Number of female managers

2019

120

770

200

0

102

125

124

119

142

2015

2016

2017

2018

2019

Number of employees taking
childcare leave（Number of persons）

Number of employees taking childcare leave (females)
Number of employees taking childcare leave (males)

400
350
300

146

250

87

200

81

21

150
100

209

191

2016

2017

177

218

50
0

2015

2018

12

Turnover rate

Male

Female

All

（%）

10.0

117
100

10

107

7.5

96

60

8

85
74

6

40

20

0

● Minnade Arukatsu (Walking event)For the walking event held twice a year by health insurance association,
We have an original incentive systems to get employees more motivated.

2.1

2015

2.4

and financial institutions as“organizations
engaging in efforts for the health managementof employees from a managerial perspective
and promoting it strategically.”
Under this program, 1,480 enterprises
were recognized as“2020 Certified Health& Productivity Management Outstanding
Organizations (Large Enterprise Category)”, out of which 500 enterprises, including
JR Central, were further recognized as“White 500.”（as of March ２, 2020）

2.7

3.3

3.0

5.0

4.5

2016

2017

2018

1.2

1.2

3.5

3.7

2019

0

0

1.2

1.4

1.4

0.9

0.9

0.8

1.1

1.1

2015

2016

2017

2018

2019

Unit

2015

2016

2017

2018

2019

38

37.9

37.8

37.6

37.4

Age

29.6

30.1

30.7

31.2

31.7

All

37.1

37

37

36.9

36.7

Male

18.2

18.2

17.9

17.7

17.4

Male

Average years of service

3.6

2.5

*Including section chiefs of non-field operations, assistant chiefs of field operations, andchief nurses (includes employees on leave, but excludes employees on secondment).

Average age

3.7
4

2

Recognition of“White 500”under the“2020 Certified Health & Productivity Management Outstanding
Organizations”

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Number of female managers● Percentage of female managers（%）(Number of persons)Non smoking support

48

673

*Including employees who use the leave system for childcare.

80

The Certified Health & Productivity Management Outstanding Organizations
Recognition Program is a certification system established by METI (Ministryof Economy, Trade and Industry). It recognizes outstanding organizations
engaging in efforts for health and productivity management, such as initiatives
for overcoming health-related challenges in communities or for promoting
health conscious activities.
The purpose of this program is to highlight outstanding enterprises
practicing health and productivity management. In this way, it also aims toorganize an environment in which such enterprises are able to gain enhancedsocial recognition from their employees, job seekers, related enterprises

626

300

Workplace vitality improvement projects
We are taking various voluntary and continuous measures both formental health and against lifestyle diseases, based on employees’healthstatus and work environments, with assistance from internal medical
professionals, with the safety and health organization at each workplaceplaying a central role. In doing so, we are effectively utilizing the group
analysis results of health checks or stress checks.

We are providing support including having
internal medical professionals give healthlectures, offering in-person instruction during
health checks or workplace inspections,establishing internal consulting services forquitting smoking, and consolidating smoking
rooms. We are also encouraging staff to utilize
the Non-Smoking Support Program by JRKENPO.

Number of males hired

800

11.4

Number of days and percentage ofannual paid leave taken

Measures

In addition to stress checks for all the employees (with check items morethan required by law), we carry out stress checks with our own additional
indicators for employees who have newly joined the Company, moved
to another department, or been promoted. Internal medical professionals
have interviews with employees who are found to be highly stressed.
Furthermore, annual meetings are held for new management staff (equivalent
to department heads) and the health promotion staff to share health issuesof our employees and our promotion measures.

Number of females hired

900

18,16420

U
 nderstanding the health status and sharing health issues
and enhancement measures

Number of hires by gender（Number of persons）

100

to work in a lively way.

2

Non-consolidated Number of Employees
and Percentage of Female Employees

FemaleFemaleYear

All
Average number of training hours per year

Hours

8.3

8.7

9.2

9.7

10.1

17.1

17

17

16.8

16.5

34

35

32

34

36

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202049

Social

New York
Baltimore,
Washington D.C.

SocialOverseas Deployment ofHigh-Speed Railway Systems

DallasThe Northeast Corridor Project(Washington D.C. - New York)The Texas Project(Dallas - Houston)

HoustonTarget lines for overseas expansion

SocialESG Activity Report

Financial Information

Corporate Data

SocialBuilding Relationships with
Material Suppliers
Policy on Material Procurement

and strengthen its technological capabilities. In addition, we expect
to receive feedback in the form of a stable supply of materials andequipment, technological innovation in railway-related equipment,
and cost reductions in such equipment. We therefore believe that theoverseas deployment of high-speed railway systems is an important
initiative for JR Central to fulfill its mission of maintaining and developing
Japan's main transportation artery into the future.
The candidates for deployment are countries and regions where
it can be expected to introduce total systems involving new highspeed passenger railway lines in which our superior high-speed railway
systems can be used to their full potential. Furthermore, we realize theneed for target countries and regions to have a complete legal system
where intellectual property rights and the sanctity of agreements are
established as socially-accepted ideas, a stable political situation, andthe economic strength to invest in large-scale infrastructure investments.
Therefore, the U.S. is currently the target for promotional activities.

Consulting & Coordination Business
Based on the belief that a huge infrastructure, such as a highspeed railway, which serves as the foundation of local communities
and the economy, should be owned and operated responsibly by
the governments and companies of the country or region where suchinfrastructure is located, JR Central’s policy regarding the overseas
deployment of high-speed railway systems is that we do not lead theimplementing body of development projects. Instead, we contribute to
the projects by providing consulting services. Specifically, we propose thedeployment of high-speed railways as a total system, which includes civil

Special Feature

SocialSignificance of overseas expansion
Since its establishment, JR Central has focused on safe and reliabletransportation, with its primary mission of connecting the three major
metropolitan areas of Tokyo, Nagoya, and Osaka, which form the maintransportation artery of Japan. As a result of carrying out significant
capital investment and technological development over the years, theTokaido Shinkansen has evolved significantly in terms of high speed, highfrequency, and mass transportation, in addition to safety and reliability.
The market for high-speed railways in Japan had been expanding alongwith the construction and opening of new railway lines thus far. In recent
years, however, the development of Shinkansen lines in Japan havebeen generally completed. As for the Tokaido Shinkansen, the N700S,
which began commercial operation in July of this year, is approaching its
ultimate form as Shinkansen rolling stock, and the development of new
trains is also entering its phase of maturity. The overseas deploymentof high-speed railway systems that JR Central pursues is expected to
expand the markets of related domestic manufacturers and to maintain

Business Strategy

engineering structures, tracks, electrical equipment, signaling equipment,rolling stock, operation management systems, maintenance and repair,etc., to overseas markets. We not only formulate technical specifications
and provide support and consultation to ensure safe and reliable
operation of the high-speed railways by supplying various manuals
regarding operations and maintenance, and conducting educationand training for staff, etc., but also coordinate with relevant Japanesecompanies when projects become concrete.

As it is necessary to procure higher-quality and reliable materials
at reasonable prices to support safe and reliable transportation by
railways, JR Central procures quality materials in Japan and fromoverseas based on its“Basic Philosophy of Material Procurement.”
In particular, we recognize that quality is the most important factor
and examine our suppliers' manufacturing capabilities and technologicalstandards as well as their efforts to maintain and improve suchcapabilities and standards. In addition, we are constantly striving to
reduce costs by promoting the entry of new suppliers, placing ordersthat take into account economies of scale, and strictly assessing
manufacturing costs among other efforts.
In the railway business, which requires us to continue fulfilling oursocial mission in a stable and sufficient manner over a long period oftime, it is also necessary to maintain the quality of materials used in thebusiness over the long term. For this reason, we ask our suppliers toprovide us with a stable supply and after-sale services.
Furthermore, in order to avoid the risk of supply disruption due to an
earthquake or other disasters, we place orders for materials that are
indispensable for ensuring safe and reliable railway transportation withmultiple suppliers, taking into account the locations of our suppliers'
plants, so that our manufacturing bases are geographically dispersed.
Suppliers are business partners in constantly making efforts to reduce
costs while maintaining and improving product quality. We believethat building continuous and stable business relationships will enable
the Company to procure high-quality products at low prices and, asa result, will contribute to the enhancement and development of theentire railway related businesses in Japan, including our suppliers.

Basic Philosophy of Material Procurement1

Procurement prioritizes the maintenance of safe and reliable transportation

8

Establishment of a satisfactory communication framework2

Procurement of high-quality materials

9

Appropriate handling of information3

Procurement of materials at reasonable prices

10

Fair and equitable transactions

Pursuit of suppliers possessing a supply system capable of strictly
adhering to contractual delivery deadlines
Pursuit of suppliers capable of building a continuing and stablebusiness relationship
Pursuit of suppliers capable of supplying satisfactory after-sale care regardlessof whether such service is needed during normal or emergency times

11

Pursuit of suppliers given consideration to reducing the environmental burden

12Compliance with relevant laws and regulations

13

Providing and updating website information on procurements

4
5
6
7

Pursuit of suppliers capable of adapting to diverse usage environments

Initiatives in the US project
We have been working on getting the Tokaido Shinkansen system, which boasts the highest level of safety and precision in the world, up and running in the stateof Texas while introducing the SCMAGLEV, our superconducting maglev system that is capable of an operating speed of 500 km/h, to the Northeast Corridor.

The Texas Project
The Texas Project is a private business venture that aims to link two major cities,
Dallas and Houston, via the Tokaido Shinkansen rail system. The key players in the
project, Texas Central Partners and its subsidiary (collectively referred to as“TC”), arecurrently proceeding with business development activities, including the formulation oftechnical specifications and processes and the procurement of construction funds.
In order to provide TC with the technological assistance needed to move the project
forward, we launched a local subsidiary, High-Speed-Railway Technology Consulting
Corporation (HTeC), in 2016. HTeC currently provides TC with technical consulting for
its project-related operations, such as developing specifications, formulating operationand maintenance plans, drafting preliminary
designs for stations and maintenance facilities,
and preparing personnel training and education
programs. Furthermore, in August 2018, welaunched another local subsidiary, High-SpeedRailway Integration Corporation (HInC), to workwith TC on signing contracts for core systems
with other Japanese manufacturers and has
U.S. Secretary of Transportation Chao Visits Tokyo Station been preparing for the project.

The Northeast Corridor ProjectWith regard to the Northeast Corridor connecting Washington D.C. to New York City,
we are aiming to introduce our SCMAGLEV, starting with promotional activities to realize
cooperation between the Japanese and U.S. Governments for the development of the
Washington D.C.-Baltimore section. Currently, the Federal Railroad Association and otherrelevant organizations are making preparations for environmental impact assessment andother procedures, using a federal grant of 27.8 million USD provided by the U.S. Federal
Government to the State Government of Maryland to cover the survey costs for thesection. The Government of Japan also commenced research in FY2016 to introduce the
SCMAGLEV in the U.S. Meanwhile, both the Japanese and U.S. Governments are showing
more understanding and support for this project, in part because we provided the U.S.
Secretary of Transportation, the Governor of Maryland, and other leading officials with
an opportunity to ride on a Maglev train in Yamanashi Prefecture and realize the strong
potential of the technology. We are planning to provide comprehensive technical support
when the project is put into action.

consulting in FY2014. We have completed four individual projects so far, and we are currently providing technical consulting for renewal work for switchboards scheduled by Taiwan High Speed Rail Corporation.

Making Efforts to Promote Japanese High-Speed Rail Systems as a Global Standard

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Fuel and chemical products

2%

Avoidance”, as a global standard, through the International High-Speed
Rail Association (IHRA).

Quality Management Initiatives
JR Central recognizes that the quality of procured materials is
extremely important from the viewpoint of ensuring safe and reliablerailway transportation. Therefore, we conduct rigorous inspections oftechnological levels and manufacturing capabilities, perform quality
audits at our suppliers' plants and take other steps to ensure that thequality required for our products is maintained.

Miscellaneous materials

1%

Machinery and work tools

6%

14%

In response to a request for technical assistance from Taiwan High Speed Rail Corporation, which operates Taiwan’s high-speed rail system based on the Japanese high-speed rail system, we started providing technical50

The amount of materials procured in FY2019 was 154.6 billion yen,and the main items procured include rolling stock, rails, maintenance cars
(cars used for the maintenance, etc., of railway facilities) and railway
sleepers.
Since the Company procures a wide range of materials, including rollingstock and rolling stock components, rails and other track materials, andpower transmission systems, we procure materials from many suppliers.
In FY2019, we had transactions with approximately 400 suppliers.

Rails and othertrack materials

Technical Consulting for Taiwan High Speed RailWe will continue to promote initiatives to establish the Japanese
high-speed rail system, which is based on the core principle of“Crash

Actual Quantities Procured of Main Materials (FY2019)

Signals andcommunications
systems

16%

Rolling stockand rolling stockcomponents

Costs of
Purchases JPY

154.6billion
Power transmission
systems

22%

39%

Conducting a quality audit of rolling stock components

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202051

SocialSocialSocialtourist information center in line with the station's improvements. JR
Central has decided to newly create the space necessary for the plan toturn the area around the station into a hub and thereby contribute to the
local community.
As a railway company
that contributes tolocal communities anddevelops together with
communities, we willcontinue to improve theconvenience of stations
and other facilities incooperation with thelocal governments
concerned.

Image of improved Kariya Station

Initiatives to improve the level of accessibility

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Financial Information

Corporate Data

SocialParticipating in programs to vitalize local communities

Enhanced convenience of stations, etc.

52

ESG Activity Report

Cooperation with
Local Communities

Improving the Convenience of Facilities

Based on relevant laws, such as the so-called Barrier-Free Act, JR
Central cooperates with the state government and municipalities
to jointly establish and improve facilities to enable all passengers,
including persons with disabilities and elderly passengers, to use ourservices safely and with a sense of security.
As part of our initiatives taken in stations, we are proceedingwith our plan to eliminate uneven ground by installing elevators,
etc. and to install multi-functional toilets sequentially in stations
used by 3,000 or more passengers per day. Basically, in all of thestations, installations have been completed or are under way. We
have completed installation of guiding blocks for visually impaired
persons and braille blocks that prevent such persons from falling fromplatforms. Furthermore, in regard to braille blocks, we are sequentiallyreplacing them with the type of braille blocks that indicate where
platform edges are located. In addition, we are working to install
platform screen doors to further enhance safety on platforms. On the
Tokaido Shinkansen line, installation work commenced in FY2011,
aimed at fencing off platforms at busy stations where Nozomi stops.
At Shin-Osaka Station, the installation of fences for Platforms 25 to
27 was completed. When the work to fence off Platforms 20 to 24 iscompleted as scheduled by FY2022, all of the platforms at stations
where the Nozomi stops will be fenced off. On conventional lines,
installation work commenced on the inbound and outbound Tokaido
line platforms at Kanayama Station. They are planned to be put into
use in 2021. In addition, as we prepare for installation at Nagoya
Station, we are considering installing fences on the platforms of theTokaido Line and the Chuo Line, which are used by many passengers,
and we will start the installation work where we are ready to do so.

Special Feature

SocialImproving the Convenienceof Facilities

Railway stations are important for local communities because they
serve as a connecting point with the local community and secondarytransportation, such as buses, private cars, and taxis, and they are also
the bases of areas where people gather.
JR Central cooperates with requests from local municipalities toimprove stations, including installing handicap accessible passages,
building over-track stations, developing plazas in front of stations,installing new stations, promoting railway elevation projects, etc., thereby
contributing to community development.
For example, since the number of passengers using Kariya Stationon the Tokaido Line is increasing, particularly during morning andevening commuting hours, we are currently in the process of conducting
preparatory work to widen the platforms, install movable fences, andimprove the concourse based on discussions with Kariya City regarding
improvements to ensure safe and comfortable usage.
Kariya City plans to establish and operate a local exchange base andBusiness Strategy

Wi th th e ai m of mak i n g rai l w ay u se more comf ortable andconvenient for everyone, we have installed facilities for wheelchairusers on almost all trains we operate. At the same time, our station
staff offers assistance and guidance to passengers with disabilities
when necessary to use our facilities.
In addition, we are working to improve our services by, forexample, exchanging opinions with organizations for persons withdisabilities through a study group on promoting accessibility of
Shinkansen services hosted by the Ministry of Land, Infrastructure,
Transport and Tourism, considering the installation of a free spacefor wheelchairs, reviewing the information provided when wheelchairusers use the wheelchair accessible seats on the Tokaido Shinkansen,
and accepting applications for wheelchair accessible seats on thewebsite.

Image of movable fence(The photo shows a prototype fence at Kanayama Station.)

Roll out of initiatives in coordination with communities located along our lines

IIMONO TANBOU

As part of sales and marketing, we are deepening ties with
communities located along our lines while rolling out initiatives suchas the “Shupo” campaign, “Sawayaka Walking,” and “Destination
Campaign (hereinafter“DC”)”.
The purpose of Sawayaka Walking is to promote the use of railways
on Saturdays, Sundays, and holidays throughout the year. This walking
event allows visitors to experience the attractive nature, history, andculture of each area along the railway line and also contributes topromoting the good health of participants. It started in 1991, and in
2018 the cumulative number of participants exceeded 5 million.
DC is one of the largest tourism campaigns in Japan, which sets thetarget areas every three months for spring, summer, fall, and winter,with the cooperation of the local municipalities concerned, six JRGroup companies, travel agencies, etc., to promote new tourist sites
in the target areas and attract customers by rail. In DC implemented
along the lines we operate, we run sightseeing trains to have users
enjoy the charms of the region and sell
travel products that incorporate sightseeing
materials and benefits in cooperation withresidents in communities along the lines.
In addition, even for DC conducted along
railway lines operated by another company,
we advertise the campaign at stations weoperate to widely raise awareness of theattractiveness of tourist sites and work withvarious parties concerned to attract tourists
in locations across Japan.

As an initiative aimed at vitalizing local communities through related
businesses, we operate the“IIMONO TANBOU”website, which sells delicious
food and selected crafts produced along the railway lines we operateand delivering them directly from the production areas. By introducing theattractiveness of the areas along lines through the sale of products that are
not yet known nationwide, JR Central and the producers are working together
to vitalize local communities. In order to pass on the culture and traditions
handed down to the future, we are promoting measures to support producers
working hard to develop
original products, etc., in eachregion. In addition, we are
expanding the scope of ouractivities so that people canfeel familiar with the areas
along our railway lines by,for example, holding eventswith the name “IIMONOTANBOU” at department
stores and providing handson type tours to such areas.
Going forward, we willcontinue to add various
products representative of
the railway lines and work
Scan here for thewith producers to revitalize
IIMONO TANBOU
local communities alongwebsitethose lines.

Shupo

IIMONO TANBOU website

SCMAGLEV and Railway Park - A museum of memories and dreams -Discover the Shinkansen Day

We opened the“SCMAGLEV and Railway Park”in March 2011 in Kinjo
Futo, Minatoku, Nagoya, as part of our participation in the“Monozukuri(manufacturing) Culture Exchange Area Project”, hosted by the City of
Nagoya.
At the“SCMAGLEV and
Railway Park”, we introduce
the progress of the high-speed
railway technology throughdisplays of rolling stock mainlyof the Tokaido Shinkansen, as
well as conventional lines andSuperconducting Maglev. The
number of visitors exceeded
5.21 million by the end of
FY2019.

Every year at the Hamamatsu Workshop, we hold the“Discover
the Shinkansen Day”with the aim of making people feel closer to theTokaido Shinkansen. We open our Hamamatsu Workshop to the public
for free, and visitors can get a closer look at the attractive features of the
Shinkansen, which are usually not visible from station platforms or along
railway lines.
Specifically, we offer programs such as a tour of the Shinkansen
driver's platform, a tour inside the Doctor Yellow train, an exhibition andboarding experience of maintenance vehicles, a hands-on experienceas the conductor and the purser, and a chance to experience in-train
cleaning and maintenance work, all of which are quite popular.

*In fiscal 2020, the event was cancelled due to the impact of the novel coronavirus.

SCMAGLEV and Railway ParkCENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

53

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

SocialCooperation with Local Communities

Disaster prevention and recovery activities in coordination with local communities
To be prepared for a large-scale disaster or other unforeseen
contingency that might occur on the Tokaido Shinkansen Line,
we are conducting comprehensive accident response training,etc., with the aim of enhancing the technical capabilities of
employees in each line of operations and affiliated companies andstrengthening cooperation among related parties, including thepolice and fire departments, to provide relief to customers andestablish a system for early recovery.
As for our conventional lines, we conduct drills to quickly guidecustomers based on the assumption that trains stop between
stations made after the occurrence of Nankai Trough earthquake.
In the past drills, we had elementary school children and workers
at local governments along the railway line participate as partof our disaster prevention efforts in cooperation with local
communities.

Comprehensive accident response training
Tsunami evacuation guidance training on the Kisei Line

Earning trust from customers and offering user-friendly services
JR Central is committed to providing services that are trusted
and welcomed by local communities and customers, based on ourbelief that providing safe and reliable transportation and high-quality
services to customers and satisfying customers also leads to making
ourselves happy.
For the Shinkansen, we are implementing the “Brand Quality
Service Campaign”to provide customers with a sense of security,
satisfaction, and joy. Having set our customers service mission as“Respecting each customer's time,”we are working to improve thelevel of our customer service by promoting good teamwork within
the Company including stations. While in recent years, the numberof online reservations has been increasing, the JR Central Group ismaking concerted efforts to enhance its knowledge and skills andfoster a service-oriented mindset so that we can accurately respondto the traveling needs of a wide range of customers, including those
who are accustomed to traveling on business and travelers visiting
Japan.
On our conventional lines, we are aiming to provide customers
with truly valuable services, or what we call“Real Value Services.”
The conventional lines that we operate run in a wide range of areas,each of which has its own unique characteristics. Therefore, each of
our employees is required to think independently and take initiatives
to provide services that best suit the purposes and situations of ourcustomers. In order to encourage customers to choose our railway,

we encourage employees to enhance their ability to notice the needsof customers and proactively and sincerely provide services that
could make customers feel“a sense of security”along with“a senseof affinity,”such as warmth and familiarity.

International Exchanges
As a railway operator that has continued to be responsible formanaging Japan’s main transportation artery and has long been
accumulating experience, JR Central has responded to the expectationsof society also in the form of international exchange, such as receiving
observation visits and developing human resources.
In Japan, at the request of the government and other parties
concerned, we take officials from foreign governments, overseas railway
operators, and other related persons on tours of railroad-related
facilities, primarily of the Tokaido Shinkansen, to introduce the businessof JR Central and exchange opinions on railway management andother matters. Furthermore, in collaboration with several universities in
the U.S., we have established and are operating a summer internshipprogram for students, providing them with opportunities to learn
about the railways and culture of Japan, thereby increasing theirunderstanding of our company. The diverse knowledge gained throughthese visits and programs is also utilized in our initiatives, for example,
to attract inbound travelers.
Outside Japan, JR Central maintains three overseas offices in
Washington D.C., London, and Sydney, and proactively undertakes awide range of international operations, such as gathering mainly railway
information from countries around the world, exchanging information
with specialists and persons in the railway industry in various countries,and engaging in PR activities for overseas markets. We are also actively
taking part in international exchanges in these countries. In the U.S. forexample, we hold exhibitions on the superconducting maglev system at
STEM (science, technology, engineering, and mathematics) education
events and provide local children with opportunities to experience
cutting-edge science and technology. Meanwhile in the U.K., we operate
an exchange training program in which executives are dispatched toand from a local railway operating company, infrastructure managementcompany, etc., as a way of providing opportunities for employees ofboth the Company and other firms to develop their skills in railway
management and technology through such exchange.
The internship program for university students in the U.S. andexchange training program with the U.K. firms are held every year,
and both programs have been held more than 20 times since their
inception. When reunions for participants of these programs are heldin both countries, many alumni gather, forming a network of people
who share a good understanding of JR Central overseas. The strong
relationships of trust that we have nurtured with people who havevisited our company over many years support the various activities we
conduct overseas.

Accepting interns from foreign universities

Promotion of culture, art, and lifelong learning (JR Central Lifelong Learning Foundation)

Customer service role-play

JR Central Lifelong Learning Foundation is a public interest
incorporated foundation established with the purpose of contributing
to society through promotion of culture, art, and lifelong learning.
Established in October 1990, the Foundation marked the 30-year
anniversary of its founding in 2020. The Foundation’s main activities
include holding exhibits of the artwork of Hoshun Yamaguchi, apioneer who drove new Japanese art, at Hoshun Yamaguchi Memorial
Hall, which opened in Hayama-machi, Kanagawa, in October 1991,
and disclosing the ateliers and gardens that offer seasonal flowers
and trees loved by Hoshun and his wife for public viewing. Further,in an effort to support lifelong learning, the Foundation engages in awide range of cultural business activities, including holding classes on
Japanese-style painting and ink-wash painting and organizing classes
to learn about history and culture.

Setting general hospitals for local communities (Nagoya Central Hospital)
Hoshun Yamaguchi《Boukyo - small sketch》1953

As an acute care hospital, Nagoya Central Hospital, locatedin Nakamura-ku, Nagoya, performs over 1,600 surgeries year
round, providing some of the most advanced medical careservices available using the latest medical equipment. The
hospital is also a committed emergency health care provider,coordinating with local ambulance services to take in over
4,200 ambulance calls per year. Looking ahead, the Nagoya
Central Hospital will look to leverage its distinctive features andexpertise to further contribute to the local community.

Hoshun Yamaguchi standing in his atelier

Nagoya Central Hospital

54

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

55

Environment

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Environment

Environment

Guidelines and Objectives

Contribution to Global Environment Preservation

Envir onment al Ac t ion G uidel ines
JR Central has established a set of Environmental Action Guidelines consisting of the following seven items as part of its
engagement in global environment preservation.
Provide comfortable transportation services topromote further use of railways, which offer superior
global environment preservation
2 Promote technological development that contributes
to global environment preservation
3 Use fuel and energy efficiently
1

4 Promote waste control and recycling

5 Appropriately manage chemical substances

6 Procure environmentally friendly goods and materials
7

Contribute to society and raise awareness for global
environment preservation

Envir onment al goal
JR Central has formulated the Commitment to a Low
Carbon Society Phase II, in which our Energy Consumption
Unit(*) as of FY2030 will be improved by 25% comparedwith that of FY1995 (refer to the Japan Business Federation(Keidanren) website for further details), and is striving
to make sure that the plan is executed. Up to now weestablished a Voluntary Plan in which we achieved our targetof a 15% reduction in energy consumption as of the end of

Engagement in Global Environment
and providing guidance. In addition, the General Technology
Division is promoting the development of technologies that
contribute to energy conservation.
In order to ensure that the initiatives described above are fully
understood throughout the Company, we hold meetings by thoseconcerned and provide guidance to the entire Company, including
the Railway Business Division, on the current situation regarding
global environment preservation, and on the Company's policy andcompliance.
Also, the Company's Technology Research and Development
Department has acquired ISO 14001 certification, the international
standard for environmental management systems. In order tofurther refine the characteristics of railways that are superior interms of global environment preservation, we are working on global
environment preservation activities through the development ofenergy-conserving technologies, etc.

Distribution of Passenger Transportation Share, in terms ofTransportation Volume, Energy Consumption, and CO2 Emissions

Comparison of the Tokaido Shinkansen and Airplanes (between
Tokyo and Osaka)

In order to ensure compliance with various environmental laws andregulations, we conduct an annual compliance survey at all workplaces.

M anagement of c hemic al subst anc es

Energy Consumption per Seat

Less thanBus

1%

AirplaneLess than

Car

Other

1%

Shinkansen

90MJ

3%

*1

Series N700
“Nozomi”

57%

B777-200

80%

30%Transportation volume(passenger-kilometer)

Shinkansen

7%

8%
3%
4%
Energyconsumption

90MJ *1

Series N700
“Nozomi”%

3

Shinkansen

7%

CO2
B777-200
emission rate

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

1/8

Approx.
of an airplane

Shinkansen*1

4.2kg-CO2

Series N700
“Nozomi”
Airplane

746MJ *2

B777-200*1

4.2kg-CO2

Series N700
“Nozomi”

1/12

Approx.
of an airplane

50kg-CO2 *2

1/12

Approx.
of an airplane

Based on the PRTR system*1 under the Act on Confirmation, etc. of
Release Amounts of Specific Chemical Substances in the Environment andPromotion of Improvements to the Management Thereof (Pollutant Release
and Transfer Register Law), we report the amount of emissions and transfer
of relevant substances and manage those substances appropriately.
Meanwhile, in regard to the full body painting of trains on shinkansen
and conventional lines, we had been using oil-based paint containing
volatile organic compounds (VOC).
However, we introduced the country’s first water-based paint coating robot
for the shinkansen in our Hamamatsu
Workshop, which enabled environmentfriendly water-based painting. With
regard to conventional lines, we also
introduced the country's first waterbased paint coating robot for trains
on conventional lines in the Nagoya
Workshop in March 2020, enabling
Picture of train body painting
water-based painting of some bodies.

M easur es against soil c ont aminat ion
We will submit a report to the relevant organizations should any
substances exceeding the standard value set be detected in soil
surveys conducted at the time of landform changes or land sales, andwill take appropriate measures as instructed by laws and regulations
and the administrative authorities.

We also conduct internal audits to confirm compliance at each workplace
and provide feedback on the results to ensure thorough compliance.

Measures against water contamination
Some of our offices use vehicle
washing equipment that falls under the
category of specified facilities under
the Water Pollution Control Act. We
are working to prevent water pollution
by installing devices, etc., to treat
wastewater generated by cleaning andregularly measuring the pollution statusof such wastewater.
Wastewater treatment device

M easur es against ai r polluti on

In relation to boilers, which are soot and smoke emitting facilities*2,
we introduced burners to reduce the generation of NOx and devices
adopting an exhaust gas recirculation system, etc., that reduce thegeneration of NOx by recirculating combustion exhaust gas, andregularly measure and record the amount and concentration of sootand smoke. By doing so, we are striving to prevent air pollution.
In addition, in accordance with the Act on Rational Use andAppropriate Management of Fluorocarbons (Fluorocarbons Recovery
and Destruction Act), we manage class-1 specified equipment properly
by inspecting and keeping records on it.
*1: System under which business operators identify the amount of chemical substances that may be harmful
to human health or the ecosystem that are released from their business sites into the environment (air,water, and soil) and are transferred outside of business sites as part of waste and report it to the national
government. The government then tabulates and discloses the amounts released and transferred based onsuch reported data and estimates.
*2: Soot and smoke emitting facilities refer to facilities installed in workplaces that generate and emit soot andsmoke and that can cause air pollution through such soot and smoke.

Effective Use of Resources/Use of Natural Energies and Introduction of Energy-Efficient Facilities
JR Central promotes effective utilization of resources throughthe 3R (Reduce, Reuse, and Recycle) initiative, etc. Specifically, we
aim to reduce emissions from waste materials during construction,utilize rainwater, recycle tickets and uniforms, and recycle rollingstock, etc.
In addition, we strive to leverage natural energies and introduce
energy-efficient facilities when constructing new buildings andrenovating existing buildings.

Airplane

Airplane

746MJ

*2

Source: For transportation volume/energy consumption, created based on data from Handbook of Energy & Economics Statistics
Source: For CO2 emissions, created based on data from the National Institute for Environmental Studies, Greenhouse Gas
Inventory Office of Japan*The totals for items in the breakdown may not be 100% due to rounding.

56

Approx.
of an airplane

CO2 Emissions per Seat

7%
5%

1/8

Airplane84%*JR Central defines Energy Consumption Unit as the“Amount of energy consumed whenrunning 1 car for 1 kilometer”, due to total rolling stock kilometers being the value which is
the most relevant to our business activities.

Legal Compliance

The problem of global warming is an issue that should be dealt
with on a global scale. While it is regarded that CO2, amonggreenhouse gasses, in particular has the largest impact on global
warming, railways account for only 7% of CO2 emissions despite
undertaking 30% of the country’s overall passenger transportvolume. Compared with an airplane (B777-200), the Tokaido
Shinkansen (Series N700“Nozomi”) consumes approximately 1/8thof the amount of energy per seat when traveling between Tokyo
and Osaka, and discharges about 1/12th of the CO2 emissions.
The data shows that the Tokaido Shinkansen has overwhelming
environmental superiority.
Efforts to preserve the global environment are being promoted
through close cooperation among relevant departments in theManagement Division and the General Technology Division.
Specifically, we have formulated policies for energy and resource
conservation, and are working to raise awareness of environmental
conservation throughout the Company by disseminating the policies

Railway

FY2010, and we have proactively developed and introduced
energy-conserving rolling stock. We will continue promoting
proactive initiatives, such as the continuous development andintroduction of energy-conserving rolling stock, while setting
train services flexibly to meet the needs of passengers byapplying the“12 Nozomi”Timetable.

B777-200

50kg-CO2 *2*1 Calculation based on running performance of Series N700 Nozomi (Tokyo - Shin-Osaka) conducted by JR Central.
*2 Calculated by JR Central using ANA's“Annual Report 2011”B777-200 (Haneda - Itami/Kansai Airport) for reference.

G r een Pr oc ur ement G uidel ines
JR Central implements a green procurement policy, prioritizing the
procurement of eco-friendly materials. To this end, we establishedthe JR Central Green Procurement Guidelines to enhance
URL

coordination with our business partners and work with them tocontribute towards global environment preservation.

https://company.jr-central.co.jp/company/material_procurement/_pdf/green_guide_line.pdf

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

57

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

Environment

Contribution to Global Environment Preservation

Initiatives with Conventional Lines

Initiatives with the Shinkansen

Int r oduc ing Ener gy- Conser ving Rol l ing S t oc k

In tr odu cin g En e r g y -C ons er v ing Rol l i ng St o c k
We are actively developing and introducing energy-conserving
rolling stock in an effort to further reduce the Shinkansen's energy
consumption. Starting from FY2007, we have introduced a totalof 80 Series N700 trainsets to replace Series 300, while from
FY2013, a total of 51 Series N700A trainsets to replace Series 700.
In addition, we made all Shinkansen rolling stock N700A type* byreflecting some of the major functions adopted by N700A in the
introduced Series N700 until FY 2015.
When operating between Tokyo and Shin-Osaka at a highest
speed of 285 km/h, the N700A type consumes 23% less energy
than the Series 300 and 16% less energy than the Series 700 when
Comparison of Electricity Consumption by Tokaido Shinkansen
Rolling Stock Type

N700S
（2020）

80

80
Series 0 / Series 100

6060Energy-conserving rolling stock
Series 300 / Series 700

40

Even more energy-conserving rollingstock Series N700 / N700A

20

0

40

20

’90 ’91 ’92 ’93 ’94 ’95 ’96 ’97 ’98 ’99 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 ’15 ’16 ’17 ’18 ’19

0

（FY）

*Simulated run from Tokyo to Shin-Osaka at the maximum speed above

E n h an c e me n t o f el ect r ici t y s uppl y effi ci en c y b y re p l a c i n g g ro u n d f a c i l i ti e s
By replacing the electricity compensation devices from FY2011
to FY2022, which inhibit voltage reduction as rolling stock travels
away from a substation, with a facility with less electricity loss, we
expect to be able to reduce the electricity use on the Shinkansen
by approximately 3%.

In some sections, we have installed frequency converters thatconvert 50Hz electricity into 60Hz electricity, which is necessary
for Shinkansen operation. Between FY 2014 and FY 2023, we areproceeding with work to replace some of these devices with thosewith less electricity loss. This is expected to reduce the electricity
use on the Shinkansen by approximately 2%.

Gr e at e n vir on m ent al per for m ance of T ok a i d o S h i n k a n s e nTokaido Shinkansen has greatly improved in environmental performance both in terms of speed and comfort due to the introduction of the following technologies.

1
2

Reduction in running resistance
Figure 1

With regard to N700A type, we reduce the running resistance by introducing a nose shape with great aerodynamic attributes, using flush
windowpanes, which have no unevenness between the outside panel and windowpane, and installing coverall hoods between all cars, etc. The
N700S’
s Dual Supreme Wing design contributes to reducing air resistance even further.

Use of silicon carbide
semiconductor drive system

The N700S’s drive system employs next-generation low-loss silicon carbide semiconductors with superior high temperature performance. The
N700S is the first Shinkansen rolling stock that employs a smaller sixtupole magnet instead of a quadrupole magnet in its motor, making the drive
motor more compact and more lightweight than ever before. The overall weight of the drive system is 10 tons lighter than that of the Series N700.

3 Introducing the Body Inclining System
Expansion of Electric Power
Regenerative Braking System

4

Figure 2

We adopt the Electric Power Regenerative Braking System, in which the motor is used as a generator during braking to produce electricity andreturn it to the catenary. While 12 of the 16 cars in one trainset of Series 700 were regenerative, 14 of the 16 cars in one trainset of the Series
N700 or later versions are regenerative. The Electric Power Regenerative Braking System provides all of the braking power needed for one
trainset during normal braking.

Lighter, smaller blower-less
CI in all motor cars

The power converter (CI) converts electricity from the catenary and sends it to the motor at the time of acceleration, and returns the electricity
generated by the motor back to the catenary at the time of deceleration. JR Central employs a system that uses airflow from running for air cooling.
For N700A, these CI were made 17% smaller and lighter than that of the Series N700. In addition, for N700S, these CI were made 55% smaller andapproximately 600 kg lighter than that of the Series N700 and are installed on all motor cars.

6

Optimization of cabin lighting
and introduction of LED lighting

In the cabins of regular cars on the N700A, lighting has been optimized in accordance with the bright seat colors. LED lighting with a dimmer function
have also been installed in the toilets and powder rooms. These measures have contributed to achieving a reduction in lighting energy consumption byapproximately 20% compared to Series N700. We have been installing LED lighting in passenger cabins of rolling stock introduced in FY2016 and thereafter
to reduce power consumed for lighting. In addition, N700S was the first Shinkansen to use LED headlights, achieving energy savings of approximately 50%.

7

Using eco-friendly materials

Approximately 90% (weight ratio) of the waste generated after scrapping the Shinkansen rolling stock is recyclable. With the N700A or later types, 100% recyclable
polyester has been used for seat cushions, and stainless steel has been used for bogie skirts, which cover bogies to lower air resistance, achieving high recyclability. In
addition, structural materials from scrapped rolling stock of the Series 700, etc. (aluminum alloy), are recycled into interior parts of the N700S, such as luggage racks.

5

Figure 1

Reduction in Running Resistance (Coverall Hoods)

Series 700 (Not Equippedwith Coverall Hoods)

58

The Body Inclining System is introduced in order to increase the speed at curves currently subject to speed restriction. This system
makes it possible to increase speed while securing comfort and shortening travel time, and to simultaneously cut power consumption by
reducing the frequency of speed acceleration and deceleration.

N700A (Equipped with
Coverall Hoods)

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Figure 2

Electric Power Regenerative Braking System

Brakes (Power generation)

Power running (Power consumption)

The motor is used as a generator during braking
to produce electricity and return it to catenary.

The regenerated power returned to catenary
is reused when accelerating other trains.

Comparison of electricity consumption and diesel fuelconsumption of cars on conventional lines(electric railcars and diesel railcars)

How the hybrid system works■ Electric railcars

A combination of electricity generated by the engine and electricity stored in a storage battery is used to drive the motor that powers the train.

Conventional type(Series 117,110 km/h)
Energy-eﬃcient type(Series 211,120 km/h)
Energy-eﬃcient type(Series 313,120 km/h)
Energy-eﬃcient type(Series 315,120 km/h)

100（Base）

86
69
60

*Based on simulated test runs between Toyohashi and Ogaki (rapid operation)■ Diesel railcars

Conventional type(rolling stock with conventional engine)[When accelerating][During braking][When stopping at a station]

A train is primarily powered by electricity
generated by its engine. The storage battery
is used to supply additional power dependingon the circumstances to realize high-speed
operation.

Electricity generated by the regenerative
braking system is stored in the storage
battery.

The idle-stop system shuts down the engine
when the train stops at a station.

EnginePower
converter

Motor

Storage battery

100（Base）

Energy-eﬃcient type(cars with new model energy-eﬃcient
type engines)

Speed

71

*Based on results of running the same railcar with a conventional engine anda new model engine (Conventional engine: DMF 15HS, new engine: C-DMF 14HZ).

EnginePower
converter

Motor

Storage battery

Air conditioner, lighting, etc.

Accelerating

EngineGenerator

N700A（2013）

72％

（%）
100

manufacture 352 new cars and begin to use them.
In anticipation of the replacement of the 85 Series diesel railcars
currently used for the“Hida”limited express and other trains, the Company
is newly developing testing vehicles for the next-generation limited express
HC85 series rolling stock that uses a hybrid power generation system, andis conducting test runs to establish relevant technologies from the end of
2019. Testing vehicles for the next-generation limited express HC85 series
rolling stock are expected to achieve an approximately 15% improvementin fuel efficiency and reduction in exhaust fumes, such as CO2 and NOx, bymaking use of power stored in batteries when accelerating and stopping.
We are currently reviewing plans to commercially introduce mass-produced
vehicles by FY2022.

Generator

Series 700（1999）

77％

△6％

33

Approximately%
improvement over FY1990

JR Central has also been striving to conserve the energy of rolling stockon conventional lines. We will promote the introduction of rolling stockwith better energy efficiency by introducing the Regenerative Braking
System, higher efficiency power control conversion methods, lighter rollingstock, etc. to electric railcars, and will do the same for diesel railcars byintroducing lighter rolling stock and high mileage diesel engines, etc. As aresult of these initiatives, all of the conventional line rolling stock is energyconserving rolling stock. As the Series 211 and the like using energyconserving rolling stock need to be renewed, a new type of commuter train
Series 315 will be newly manufactured. We will further reduce electricity
consumption through the use of silicon carbide for the power converterand other energy-saving measures. From FY 2021 to FY 2025, we plan toGenerator

Series 300（1992）

92％

285km/hRatio of energy-conserving rolling stock

285km/h

100％

（%）
100

△28％

270km/h*Generic name of N700A and the Series N700 (enhanced version)

Shifts in the Ratio of the Tokaido Shinkansen Energy-Conserving Rolling Stock and Energy
Consumption Unit
Energy Consumption Unit (Ratio using an FY1990 basis)

270km/hboth are running at a highest speed of 270 km/h. This means that
the N700A type is not only faster but also much more energyefficient. As a result, the Energy Consumption unit as of the end of
FY2019 decreased approximately 33% from what it was in FY1990.
The new N700S Shinkansen rolling stock, which started operationin July 2020, has reduced energy consumption by an additional
6% compared with the N700A type thanks to its silicon carbide
semiconductor drive system, lighter car body, reduced air resistance,and other features.

Powerconverter

Motor

Storage battery

Air conditioner, lighting, etc.

Air conditioner, lighting, etc.

Braking

Hours

0

Common Initiatives for the Shinkansen and Conventional Lines
Energy-saving by replacing high-pressure mercury lamps with LED
JR Central had conventionally used high-pressure mercury lamps
for lighting in stations, railroad crossings, and other railway facilities.
However, we are proceeding to replace high-pressure mercury lamps
with LED. We plan to complete the replacement process by the end of
2020, as a result of which we will cut our annual power consumption

associated with lighting of railway facilities by approximately 70%(down 20 million kWh) compared to the level prior to the replacement
work. At the same time, we expect to also reduce the annual CO2
emission volume by approximately 70% (down 10,000 t) compared tothe prior level, thereby decreasing environmental burden.

Facility and workshop status
JR Gate Tower

Hamamatsu Workshop

With the JR Gate Tower, the construction of which was completed in February 2017, we worked on creating an energy-efficient environment within
the entire building and reduce the environmental burden by introducing regional air-conditioning systems, adopting LED lighting, installing solar power
generation panels, creating green areas in the 15th-floor rooftop garden and on roofs of low-rise buildings, etc. We not only achieved“Rank S”inenvironmental performance, which is the highest rank on the“CASBEE (Comprehensive Assessment System for Built Environment Efficiency)”scale, but also
reduced approximately 25% of CO2 emissions from the building compared to standard model buildings, according to the CASBEE Nagoya 2010 standard.

General Education Center
At the General Education Center, which was opened in September 2011, we aim
to conserve energy by introducing a ventilation system which uses ice thermal storage
achieved by the utilization of nighttime electricity service as its heat source and LED
lighting, etc. Furthermore, we designed the building to use natural energy effectively
by improving external insulation efficiency through arranging a rooftop garden andtaking advantage of natural wind and light as much as possible. As a result, we wereable to obtain“Rank S”,which is the highest assessment level under the“CASBEE”.

Nagoya Workshop

General Education Center (rooftop
gardening)

SCMAGLEV and Railway ParkAt the SCMAGLEV and Railway Park, which opened in March 2011, we
introduced a solar energy generation system on the expansive roof. The system
has a generation capacity of approximately 500 kW, or roughly 510,000 kWhannually, which can cover approximately 30% of the SCMAGLEV and Railway
Park’s energy needs.

The Hamamatsu Workshop, which conducts general overhauls of Shinkansen rollingstock, completed its renovation construction in March 2019. In addition to introducing
a solar energy generation system with the capacity to generate approximately 300 kW
or about 450,000 kWh annually on the rooftop of the workshop, we implemented ahighly efficient substation facility, boilers, and other equipment.

JR Central has been taking anti-earthquake measures and upgrading facilities
from February 2014 in the Nagoya Workshop where general overhauls, etc., ofconventional line rolling stock are conducted. We aim to reduce approximately
20% of electricity consumption for the entire workshop by introducing highceiling LED lighting and replacing some transforming equipment with highly
efficient ones to meet requirements under the Top Runner System*.
*E nergy consumption efficiency target specified for specificequipment in the“Act on Rational Use of Energy”

SCMAGLEV and Railway Park (solar
power generation system)

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

59

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

Environment

Contribution to Global Environment Preservation■ Environment-Related Data

Initiatives by Group Companies
The group companies are also implementing initiatives that contribute to global environment preservation.

Activity Status for FY2019 and Environmental Accounting
Tokyo Station Development Co., Ltd.
In August 2020, we opened the commercial facility“Tokyo
Gift Palette”at the Yaesu North Exit of Tokyo Station. Recycled
aluminum from scrapped Series 700 Shinkansen rolling stock
was used to create the concourse at the Yaesu North Exit andthe pillars, ceilings, and other parts of the Tokyo Gift Palette.
They are designed with the image of“cherry blossom petals”
and“store curtains”at the entrance of shops, creating a spacewith a sense of high quality unique to the Tokaido Shinkansen.

JR Tokai Takashimaya Co., Ltd.
JR Nagoya Takashimaya is switching to LED lighting and hascompleted replacement of approximately 27,000 lights. As
a result, approximately 90% of the lights in the building havebeen changed to LED lighting. In the Takashimaya Gate Tower
Mall, air conditioning efficiency is improved by preventing the
inflow of outside air and suppressing fluctuations in room
temperature through the measures of limitation in the numberof doors that are always open in the passageway (colonnade),
reduction in the shutter opening time, and set-up of new
doors in areas where outside air is flowing in.

JR-CENTRAL PASSENGERS Co., Ltd.
Coffee sold on the Tokaido Shinkansen“Nozomi”and“Hikari”ismade from over 50% coffee beans grown on farms certified by the
Rainforest Alliance. The Rainforest Alliance was established in 1987
as an international non-profit environmental protection organization,and their activities cover more than 60 countries. With the aimof improving the lives of farmers and sustainable management of
tropical rain forests, they give certification to the farms that meet thecriteria for forest and river protection, pesticide restrictions, waste
management, and the like, and through the procurement of certified
coffee beans, they contribute to global environment preservation.

The investments, costs, and their principal effect involved in environmentas waste generated during JR Central’s business

Environmental accounting

activities during the year FY2019 are as shown below.

Classification

INPUT/OUTPUT

Notes

Expenditures*Figures in parentheses are for consolidated subsidiaries.

Introduction of energy-conserving rolling stock
Improved energy-efficiency at stations andoffice buildings, etc.

478.8

39.6

Energy-conserving rolling stock ratios: 100% (Shinkansenelectric railcars), 100% (conventional line (electricrailcars and diesel railcars))● Energy eﬃciency of Series N700A ▲23% (more eﬃcientthan Series 300)
● New production of N700S rolling stock● New production of testing vehicle for HC85 series● Use of LED lighting for railway equipment

Development of energy-conserving rolling stock
Development related to environment
preservation along railway lines, etc.

1.1

135.9

● Energy eﬃciency of Series N700S ▲28% (more eﬃcientthan Series 300)
*Comparison between the Series 300 (traveling at 270km/h) and the N700S (traveling at 285 km/h)

Proper disposal and recycling of station andtrain refuse, etc.
Proper disposal and recycling of items generated
by workshops and construction work

0.4●

Globalenvironment
preservation cost

Environment
conservation
cost along
railway lines
Management
activity cost

Onboard service

Environment preservation cost(100 million yen) *1

Main Initiatives

Investment

Resource
recycling cost

Switch to LED lighting

The main resources and energy utilized as wellpreservation activities during FY2019 are estimated as listed below.

Research anddevelopment cost

Reuse of aluminum used in a train body

Environmental load in business activities

Socialactivity cost

●
●

●
●

●

●

75.5

●
●

105.6

39.4

Environmental advertising
Environmental management education etc.

0.0

0.1

●

Support and cooperation for organizations andother groups undertaking environment preservation

0.0

0.1

●

585.8

290.4

●
●

●

Total *2

Electricity●

CO2 emission rate

Environmental Partnership Organizing Club (EPOC)(0.25billion kWh)The EPOC is a group that was established in 2000
mainly by the industry sector in the Chubu region, withthe aim of building a sustainable economy and society bymaking use of achievements by companies in terms of theenvironmental area.
It conducts activities such as disseminating environmental
activities and information to society through cooperation
among companies that transcend the boundaries ofindustry and cooperation with government, academia, anda wide range of local entities. (For more information, see
the EPOC website.)
We joined EPOC in FY2002 and are currently involved in
the operation of the organization as a core company.
We will continue to contribute to global environment
preservation through EPOC in cooperation with member
companies.

(thousand t)

1,600
1,400 1,362 1,338

1,432
1,303

1,529 1,530 1,514 1,480 1,476(179,000ｔ)

Acquisition of ISO14001 certiﬁcation in Technology
Research and Development Department

Refuse and waste

458,000t

Station, train, and oﬃce refuse

16,000 t
432,000 t

Rolling stock waste*The electricity and fuel CO2
emission coeﬃcients are based ona report of the law (Act on Rational
Use of Energy) concerning thestreamlining of energy use.
*Recycled amount reprinted. Items
conﬁrmed to have been reused bymanifest or vendor have beenrecorded.

Participation in environmental partnership organizing
club (EPOC)

9,000 tRecycled

321,000 t*Including internal reuse

Power consumption(million kWh)

1,413

1,245

350

1,354

300

2,960 2,970 2,910 2,790 2,750 2,790 2,790 2,850 2,850 2,860 2,860 2,900

1,200
250

1,000
200

800

150

600

100

400
200
0

76

78

79

80

80

80

77

73

71

74

71

73

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019 (FY)

50
0

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019 (FY)EPOC’s general meeting

Amount of water used

Carbon intensity(thousand m3)

4,106

4,000
1.40
1.20

3,917

3,500

1.10 1.17 1.11 1.05 1.15 1.20 1.17 1.11 1.07 1.03 0.96 0.94

1.00

3,685 3,732 3,541
3,445

3,331 3,287 3,325

3,143 3,148

3,353

3,000
2,500

0.80

2,000

0.60

1,500

0.40

1,000

0.20

500

0.00

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

(2.698 million ㎥) (100 million sheets)

1.354 millionｔ Construction waste(tCO2/million yen)60

(34,000 kL)

OUTPUT

Protection of the surrounding environment by modifying
noise-blocking walls and increasing their height,
shaving rail surfaces, etc.

Scope 2A4-sized
copy paper*For railway operation Electricity: 2.19 billion kWh Fuel:16,000 kL

Recycle rate of Shinkansen rolling stock: Approximately 90%
Recycle rate of uniforms: Basically 100%

Scope 1Water

2.90 billion kWh 32,000 kL 3.353 million ㎥ 140million sheets[Approach to environment preservation cost]*1. Fractions below 10 million yen are omitted. *2. Totals do not add up due to rounding.
● Compilation is applicable only to JR Central. ● The applicable period is April 1, 2019 to March 31, 2020.
●“Environmental Accounting Guidelines 2005”, a publication of the Ministry of the Environment, was consulted with regard to aspects of style.
● Depreciation is not included in the calculations for expenditures.
● In the event of multiple-purpose expenditures, the full amount with greater environment preservation eﬀect is included in the calculation.

Cooperation with External Entities

Fuel(Amount of
converted crude oil)

CO2 emission

Countermeasures for noise and vibration● Proper management of environmental load
substances, etc.
●

INPUT

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019 (FY)

0

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019 (FY)CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

61

GovernanceBusiness Strategy

ESG Activity Report

Financial Information

Corporate Data

Governance

JR Central strives to enhance our corporate governance to ensure soundness,

Governanceefficiency, and transparency of management, to implement long-term

Corporate
Governancedevelopment of the company, and to enhance sustainable corporate value.
We have announced our stance on, and the initiatives put in place, in
relation to the Corporate Governance Code found within the Corporate
Governance Report*.
*The Corporate Governance Report can be found at the following URL.
Corporate Governance Information Service

URL

https://www.jpx.co.jp/listing/cg-search/index.html

JR Central's Corporate Governance System

O ut side D ir ec t or s and O ut side Audit and S uper visor y B oar d M ember s
Based on our policy to make the most appropriate execution
system for Outside Directors and Outside Audit and Supervisory
Board Members, JR Central appoints three Outside Directors andfour Outside Audit and Supervisory Board Members. The Company
determines the level of independence of Outside Directors andOutside Audit and Supervisory Board Members based on thecriteria for independence established by the Japan ExchangeGroup, Inc. in order to ensure that the opinions provided by
Outside Directors and Outside Audit and Supervisory Board
Members on matters raised are formed from an independent
standpoint, and are based on the high degree of experience andinsight accumulated outside the Company.
JR Central receives beneficial opinions about the executionof our business from Outside Directors and Outside Audit and●State of main posts held concurrently for Outside Directors and Outside Audit and Supervisory Board Members

Selection

Selection

Selection

Audit and Supervisory Board

Cooperate

Internal Audit Department (Audit Department / Transportation Safety Department)

Management / Guidance

Audit

Subsidiaries, etc.

ReportAudit

JR Central’s Board of Directors is composed of 16 members(including three outside directors) and chaired by the company
chairman. JR Central also employs an auditor system, and its Audit
and Supervisory Board consists of five members (four of whom areoutside auditors). (The figures are as of June 23, 2020)
The Board of Directors meets at least once a month to makelegal and appropriate decisions upon fully discussing matters
stipulated by the law as well as important management matters,
following conscientious briefings that are given to bring allconcerned up to speed on the background of matters discussed
and the progress on such matters. It also monitors the work of
directors. A Management Meeting is held for in-depth discussionof important management issues. Chaired by the president, theManagement Meeting is attended by all full-time directors, Audit
and Supervisory Board members, and some corporate officers. By
deliberating on a wider range of management matters ahead ofBoard of Directors meetings, discussions at the subsequent Boardof Directors meetings are enhanced. We request members of the
Audit and Supervisory Board to attend meetings of the Board of
Directors, the Management Meeting and other important meetings,
as we endeavor to ensure the legality of management measuresduring the deliberation process. Further, JR Central strives to ensure
the appropriate execution of business by managing and providing
guidance to subsidiaries, etc. where necessary.
Although we introduced the corporate officer system in May
2003, we introduced an executive system in June 2012 with theaim of further accelerating decision-making, enhancing discussions,and further clarifying roles for directors and corporate officers, who
are responsible for operation, in order to appropriately respond tochanges in the business environment influencing our management
decisions in a timely manner. In addition, in order to make decisions

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020in line with the actual conditions of our business, some corporate
officers in charge of core operations, including the Director Generalof the Railway Business, serve concurrently as directors.
Audit and Supervisory Board Members not only attend important
meetings such as the Board of Directors and the Management
Meetings, but also inspect the state of execution carried out athead offices, railway operations divisions, branch offices, field
offices, and subsidiaries, etc. based on plans enacted by the Audit
and Supervisory Board to strictly promote their audit work. To
ensure effective audits by the members of the Audit and Supervisory
Board, JR Central also provides an assistant system in which our
employees are assigned as full-time staff to support auditors work.
Internal audits are performed by the Audit Department on theoverall work of JR Central, its major subsidiaries, and other relatedcompanies from the perspective of compliance, efficiency andeffectiveness of operations. The audits are performed by checking
business materials, contracts and other documents, observing
operations, interviewing related persons and taking other methods,
and the results are reported to management. In addition, to prevent
operational and labor accidents, safety audits are performed by theTransportation Safety Department, and the results are also reported
to management.
Based on generally accepted accounting standards, JR Central has
appropriate accounting audits made by Deloitte Touche Tohmatsu
LLC, which has been selected to be our accounting auditor.
Audit and Supervisory Board Members, internal audit departments,
and accounting auditors cooperate with each other by exchanging
information periodically or as necessary and receive necessary
information from each department involved in internal control toconfirm the status of implementation of each item stipulated in theFundamental Corporate Governance Policies.

Name[FY2019]

Name of other company, etc.

Takashi
Saeki

OutsideAudit andThe Ogaki Kyoritsu
Supervisory
Bank, Ltd.
Board
MemberShigeoKifujiKunihiro
Nasu

Mori Building
CO., LTD.

Sangetsu
Corporation

Name

Titles

OutsideAudit andSupervisory
Board
MemberOutsideDirector（Audit Member）

Audit and Supervisory Board Members

Overview of Corporate Governance System

Audit and Supervisory Board Members

Head Oﬃce, Regional oﬃces, Field oﬃces

Investigate
Audit

Audit

Activity status of Outside Directors and Outside Audit and Supervisory Board Members

Directors

Cooperate

Management Meeting

Accounting Auditors

President and Representative Director

Cooperate

Directors

Audit

Board of Directors●

Supervisory Board Members who provide advice based on theirvarious experience and great insight gained outside of thecompany from their independent standpoints, both in and outsideof the Board of Directors and Audit and Supervisory Board. We
utilize the advice given by Outside Directors and Outside Audit
and Supervisory Board Members to execute audits by Audit
and Supervisory Board Members, internal audits, safety audits,accounting audits, as well as items stipulated in the Fundamental
Corporate Governance Policies.
Each Outside Director and Outside Audit and Supervisory Board
Member is submitted to the Tokyo Stock Exchange and the Nagoya
Stock Exchange as an independent officer who does not have any
conflicts of interest with general shareholders.

[As of March 31, 2020]

General Meeting of Shareholders

62

Special Feature

Principal activity

Fujio Cho

Attended all 12 meetings of the Board of Directors held in FY2019. In the Boardof Directors meetings, he has stated his opinions based on his experience incorporate management, etc.

Kenji
Koroyasu

Attended all 12 meetings of the Board of Directors held in FY2019. In the Boardof Directors meetings, he has stated his opinions based on his experience as apublic prosecutor and lawyer, etc.

TakashiSaeki

Of the total 12 Board of Directors meetings held in FY2019, attended 11
meetings. In the Board of Directors meetings, he has stated his opinions basedon his experience in corporate management, etc.

HajimeIshizuAttended all 12 meetings of the Board of Directors, and attended all 14
meetings of the Audit and Supervisory Board held in FY2019. In the Board of
Directors meetings and meetings of the Audit and Supervisory Board, he hasstated his opinions based on his experience in transportation administration, etc.

Fumio
Yamashita

Attended all 10 meetings of the Board of Directors, and attended all 11 meetingsof the Audit and Supervisory Board held since taking office on June 21, 2019. In
the Board of Directors meetings and meetings of the Audit and Supervisory Board,he has stated his opinions based on his experience in police administration, etc.

ShigeoKifuji

Attended all 12 meetings of the Board of Directors, and attended all 14 meetingsof the Audit and Supervisory Board held in FY2019. In the Board of Directors
meetings and meetings of the Audit and Supervisory Board, he has stated his
opinions based on his experience as a public prosecutor and lawyer, etc.

Kunihiro
Nasu

Attended all 12 meetings of the Board of Directors, and attended all 14
meetings of the Audit and Supervisory Board held in FY2019. In the Boardof Directors meetings and meetings of the Audit and Supervisory Board,he has stated his opinions based on his experience as a lawyer, etc.

Ensur ing t he ef f ec t iveness of t he B oar d of D ir ec t or s and t he Audit and S up ervi sory Boa rd
The appointment of Directors is conferred to General
Shareholders Meetings following a resolution of the Board of
Directors concerning the appropriate election of candidates
deemed to be the most fitting for the role as selected based upona general consideration of their abilities, knowledge, and work
history, etc., regardless of age, sex, or nationality. The number
of Directors elected, and the division of Director roles, etc., isdetermined based on a comprehensive consideration of the levelof progress of each project at the time based on a policy of
establishing the most appropriate management structure for the
execution of the Company’s business activities.
The status of Directors and Audit and Supervisory Board
Members holding important concurrent positions is as describedin business reports and General Shareholders Meeting Reference
Materials. All currently held positions bear no hindrance on the
Director or Audit and Supervisory Board Member’s ability to fulfill
the roles and responsibilities of such a position for the Company.
The Board of Directors of the Company meets once or morea month to make legal and appropriate decisions upon fully
discussing matters stipulated by law as well as importantmanagement matters, following conscientious briefings that are
given to bring all concerned up to speed on the background ofmatters discussed including the progress. Further, the statusof the execution of duties by Directors is monitored by having
Directors report back on business functions under their charge
when needed. JR Central receives valuable broad-view advice
on management from Outside Directors, which is brought into
consideration in regulating the management of the Company.
Additionally, round-table conferences for opinion exchanges
between Outside Directors, Outside Audit and Supervisory Board
Members (part-time) and members of management are set up
ahead of meetings of the Board of Directors in order to further
improve the effectiveness of the Board of Directors.
Through the above-mentioned initiatives, we find that, at
meetings of the Board of Directors, the effectiveness of the entire
Board of Directors is ensured to a satisfactory degree.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

63

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

GovernanceCorporate GovernanceCon te n t of Com pens at ion for O ffi cer s
Directors’remuneration is comprised of basic compensation,
which is paid in a fixed amount, and a bonus. The basic
compensation amount is determined through a comprehensive
assessment of a director’s position, length of service, and otherfactors while the bonus amount is determined in consideration of
the performance of assigned duties.
The remuneration of outside directors includes only fixed basic
compensation. The Board of Directors passed a resolution tohave the president determine specific remuneration amounts at
his discretion after he explained the above remuneration policy
at a Board of Directors meeting. A decision was made at the25th Ordinary General Meeting of Shareholders held on June 22,2012 to keep the annual amount of the directors’remuneration
at 1.2 billion yen or less (and up to 50 million yen for the outside
directors’remuneration). The amounts are ultimately determinedby the president within these limits. When this decision was madeat the 25th Ordinary General Meeting of Shareholders held on
June 22, 2012, the number of directors was specified as being
20 or fewer in the company’s Articles of Incorporation. Although
we do not have an independent advisory committee to determine
compensation for directors, all outside directors and part-timeoutside Audit Supervisory Board members exchange opinions withmanagement, prior to Board of Directors meetings, on importantmanagement issues including remuneration.
The remuneration of Audit and Supervisory Board members
consists only of fixed basic compensation, and the appropriate

Compl ianc e / W hist l e- bl ow ing S yst em
amount is determined via discussions among Audit and Supervisory
Board Members. A decision was made at the 20th Ordinary
General Meeting of Shareholders held on June 22, 2007 to keep
the annual amount of Audit and Supervisory Board members’
remuneration at 250 million yen or less. The final amount is
set within this limit. When this decision was made at the 20th
Ordinary General Meeting of Shareholders held on June 22, 2007,
the number of Audit and Supervisory Board members was specified
as being 5 or fewer in the company’s Articles of Incorporation.

Total amount of compensation, etc., by officer classification, total amountof compensation, etc., by type, and number of target officers [FY2019]
Basic Compensation

Classification

Number oftarget officers

Bonus

Total amount forthe compensation/
Total
Number of
Total
bonus, etc.
amount target officers amount(Number of persons) ( Million yen) （Number of persons） ( Million yen)

Directors( Million yen)

(Excluding Outside Directors)

15

602

15

229

831

Audit and Supervisory
Board Members

1

47

-

-

47

Outside Officers

8

140

-

-

140

(Excluding Outside Auditors)

JR Central not only stipulates internal regulations based on
the law, etc., but also conducts employee education on various
occasions with the aim of thoroughly complying with the law,etc., when executing work. In addition, we also have establisheda whistle-blowing system. We have whistle-blowing contact
points not only within the Company but also in an external law

firm in order to establish a system in which employees, etc., canreport any violation of the law, etc., at work. We also post fliers
describing the whistle-blowing system and contact information
for the contact points in all workplaces with the aim of widely
disseminating the system.

Risk - management S yst em
JR Central has established the Railway Safety Promotion
Committees, etc., at the head office, railway operation divisions,branch offices, and in each area from the perspective of preventing
train and labor accidents, and formulating and promoting safetymeasures through an integrated organization that stretches fromthe head office to each field office.
JR Central also manages a control center, which plays a keyrole in information communication, on call 24 hours a day at eachrailway operation division to respond to emergencies, such asaccidents and disasters, and has also established a fast-response
restoration structure in which employees can be gathered anytime
according to the scale or impact of an accident or disaster.
Additionally, in preparation for emergencies such as large-scale
natural disasters, we have established the second Shinkansen
General Control Center that can substitute for the Shinkansen
General Control Center for the Tokaido Shinkansen.

Response t o Int er nal Cont r ol Rel at ed t o Financ ial Repor t ing
We periodically investigate the system and execution situation,etc., within JR Central and JR Central Group companies inaccordance with a basic framework offered by the BusinessAccounting Council in order to confirm that they are effectivelyfunctioning. JR Central also engages in efforts to maintain thelevel of internal control related to financial reporting by providing
feedback from these investigations to duties.

Conc ept of Capit al Pol ic y and S har ehol der Ret ur n
Polic y con c e r n i ng cr os s -s har ehol ding s
Our strategy for cross-holdings is grounded in the belief thatmaintaining and bolstering business relationships through holding
other companies’stock facilitates our operations and enhances
our corporate value over the medium to long term. If any of ourcross-holdings are deemed to be unnecessary in light of this policy,
we will assess and possibly divest in them.
Our Board of Directors examines whether it is beneficial toretain specific cross-holdings after scrutinizing them in light of themedium- to long-term economic rationale and outlook, purpose ofowning such cross holdings, etc.
In terms of the exercising of cross-shareholding voting rights,
JR Central closely examines the content of each resolution anddecides how to vote in consideration of improving the corporate
value of the Company over the mid- to long-term and thesustainable growth of business partners, etc.

Polic y for pr omot i ng cons t r uct iv e dial og w i th s h a re h o l d e rs
JR Central positions the General Meeting of Shareholders as
an important opportunity for dialog with shareholders and strives
to improve the quality of questions and answers sessions in themeeting as a means of contributing to sustainable growth andenhancing corporate value over the mid- to long-term. All dialog
with shareholders is overseen by the General Manager of the
Administration Department, and questions, opinions and requests
from shareholders are responded to, to the extent reasonable, inthe form of an individual meeting or over the telephone, etc.
Of this, dialog with institutional investors is overseen by the
Director General of the Corporate Planning Division, and the
IR team is placed in the Business Administration Department,
Corporate Planning Division in order to further improve shareholder
dialog by organically coordinating with the Administration,
Finance, Legal Departments, etc. Dialog response is the purview
of the IR team, and a response is made together with members ofmanagement and Directors, where reasonable, based on a generalconsideration of the requests and interests, etc., put forth by
the institutional investor. Specifically, we strive to improve upon
dialog measures by not only holding individual meetings but also
holding conference calls and facility tours, etc., where necessary,in addition to holding financial results briefings biannually.
We also strive to enrich the broader provision of information
to shareholders by sending reports on information presented
at financial results briefings biannually, on top of posting thisinformation on our website. Moreover, we work to ensure thata sufficient degree of information concerning decisions made on
important measures and important capital investments reaches aslarge a number of stakeholders as possible using the mass media
services to deliver detailed information at press conferences heldby the President, and by presenting such information to the press.
The content of discussions with shareholders is reported tomembers of management and, if necessary, feedback is given to
the Board of Directors.

We will finance our projects by issuing corporate bonds andborrowing, in addition to the long-term loan totaling 3 trillion yen
acquired using the Fiscal Investment and Loan Program (FILP) to
promote the construction of the Chuo Shinkansen, and we do notplan to use treasury shares or pursue capital increase at this point.
Due to the nature of the railway business, which operates froma long-term perspective, a specific dividend amount is determinedconsidering the business environment and results of each fiscal
year based on the Company’s consistent and basic policy forthe continuation of stable dividends. JR Central considers thatshareholder returns through dividends are appropriate in principle,
and we do not plan to purchase additional treasury stock at thispoint.
When we say “from a long-term perspective,” we mean that
we will not cut corners as we use current proceeds from our

Shifts in Dividends

JR Central resolved the Fundamental Corporate Governance Policies* in the Board of Directors meetings.
*Please refer to the following URL for Fundamental Corporate Governance Policies.

URL

64

https://company.jr-central.co.jp/company/about/governance.html

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Dividend per share(Yen / Year)

140

115

120

120

125

135

Net income (non-consolidated)

140

145 150

105
100

85

90

90

90

95
(Billion yen)

75

80

400

65
60

50

50

50

50

50

50

55

300

40

200

20

100

0

F u n dame n tal Cor por at e G ov er nance Pol i ci e sbusiness to take necessary steps to ensure that our rail services
continue to operate steadily over the long term. For example, wewill undertake such measures as large-scale renovations as well
as derailment and deviation countermeasures for the Shinkansenalong with working on the Chuo Shinkansen, a major long-term
project. We believe that continuing a stable dividends policy will
best meet the long term benefits of our shareholders. We will
maintain this principle of stable dividends during the constructionof the Chuo Shinkansen.

’99.3

’02.3

’05.3

’08.3

’11.3

’14.3

’16.3 ’17.3 ’18.3 ’19.3 ’20.3

0*1 W ith respect to the amount of dividend per share for FY2012, given the adoption of the unit share system of splitting 1 share ofcommon stock into 100 shares and setting one (1) unit of shares as 100 shares effective October 1, 2012, the amount was calculated onassumption that the stock split was conducted at the beginning of the period.
*2 The amount of dividend per share for FY2011 and prior is shown by dividing the amount by 100 for the ease of comparison with theamount for FY2012 and thereafter.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

65

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Governance

Respond to the Corporate Governance Code
JR Central has announced its stance on, and the initiatives it has
put in place, in relation to the Corporate Governance Code(hereafter, “the Code”) found within Corporate Governance
Report*.

Further, The reasons for not implementing the principles of thecode and matters disclosed based on each principle of the code
are as follows.

Principle 4-1
Roles and responsibilities of
the Board of Directors (1)Supplementary
principle

4-1 2

Principle 5-2

Principle 4-10

[3] Details on the policy and procedures concerning the setting of Director compensation are described in 2.1.
[Director Compensation-related] Disclosure of Policy for Determining the Amount of Compensation and the
Calculation Method for Such in the Corporate Governance Report.

Principle 3-1[4] It is our policy to appoint individuals who are most fit to perform the given duties for the company as directors
and Audit and Supervisory Board members. In accordance with this policy, we select candidates basedon a comprehensive review of their abilities, knowledge, work history, etc., regardless of age, sex andnationality, via a resolution of the Board of Directors and appoint them upon approval at a General Meeting of
Shareholders. In appointing or dismissing a representative director, we follow the same policy as well as theprovisions of relevant laws and the rules of the Board of Directors.

Full disclosure

Disclosed contents

Supplementary
principle

4-10 1

utmost importance, and all aspects of our business, from our daily business operations, to employee training and capital
investment, are implemented with the highest priority given to increasing the level of reliability of the services we provide
and, as such, we do not implement a system of management whereby company-wide mid-term business plans areformulated and managerial targets are pursued in a manner that can neatly serve as a cross-sectional look at the stateof the business at set moments.
• While JR Central neither formulate mid-term management plans nor establish numerical targets in this manner, theCompany does promote its railway business from a long-term perspective. Specifically, in addition to the constructionof the Chuo Shinkansen, which is now underway, other measures that require a long-term capital investment, such aslarge-scale renovation for the Tokaido Shinkansen, the implementation of earthquake countermeasures, and plans to
upgrade rolling stock in service, are established with a long-term perspective in mind, and we are steadily proceeding
forward these projects. Plans and results of other major measures are announced publicly as appropriate, and steadyprogress continues to be made in these areas. We will continue to announce annual income and expenditure plans, key
measures, and capital investment plans each year in light of our immediate management environment, and will continue
to steadily enhance our management foundation in order to firmly maintain a sound management outlook based on
efficient operational management stemming from the securing of safe and reliable transportation.

Three independent outside directors serve on our Board of Directors, and participate in discussions related toimportant management decisions and provide adequate oversight of the directors’ performance of duties.
Although we do not have an independent advisory committee, all three outside directors and part-time outside
Audit Supervisory Board members exchange opinions with management on important management issues including
appointments and remuneration. We also provide other information sharing opportunities that lead to constructive
discussions and the exchange of opinions at Board of Directors meetings in order to ensure appropriate involvement
and advice from independent outside directors.

[5] Director and Audit and Supervisory Board member candidates are appropriately selected in consideration of
their career background provided in the General Meeting of Shareholders material. We disclose information
concerning the change of a representative director as required by the Tokyo Stock Exchange’s Timely
Disclosure Rules.

Principle 4-1
Roles and responsibilities of theBoard of Directors (1)Supplementary
principle

4-1 1

Principle 4-9

Supplementary
principle

General principle

Principle 1-4
Cross-shareholdings

Principle 1-7
Related party transactions

Principle 2-6

Supplementary
principle

Principle 4-11
Disclosed contents[1] Policy concerning cross-shareholdings
Our strategy for cross-holdings is grounded in the belief that maintaining and bolstering business
relationships through holding other companies’ stock facilitates our operations and enhances our corporate
value over the medium to long term. If any of our cross-holdings are deemed to be unnecessary in light ofthis policy, we will assess and possibly divest in them.
[2] Assessment of cross-holdings
Our Board of Directors examines whether it is beneficial to retain specific cross-holdings after scrutinizingthem in light of the medium- to long-term economic rationale and outlook, purpose of owning such crossholdings, etc.
[3] Criteria for the exercising of voting rights
In terms of the exercising of cross-shareholding voting rights, JR Central closely examines the content ofeach resolution and decides how to vote in consideration of improving the corporate value of the Company
over the mid- to long-term and the sustainable growth of business partners, etc.
All transactions involving Directors which may pose a conflict of interest, and transactions between Directors andthe Company, require the approval of, and reporting to, the Board of Directors as stipulated in relevant laws andregulations and rules governing the Board of Directors. Every year confirmations are made on a regular basis with
officers as to whether related party transactions have been made between officers or relatives and the Company.

Roles of Corporate Pension Funds
as Asset Owners

Since we do not offer a corporate-type defined benefit corporate pension plan, this principle does not apply to us.
We use a defined contribution pension plan instead. We provide employees who participate in the defined
contribution pension plan with adequate training on asset management since the plan affects their asset
accumulation.

Principle 3-1[1] • JR Central was founded in 1987 as part of the reform of the national railway system with a mission of
integrally maintaining, developing and future-proofing the Tokaido Shinkansen, which serves as Japan's
main transportation artery linking Tokyo, Nagoya and Osaka, and the conventional line network in the Tokai
region with a central focus around Nagoya and Shizuoka.
Furthermore, JR Central established its management philosophy to “Contribute to the developmentof Japan’s main transportation artery and social infrastructure” to reflect the direction the Company
should aim at in line with the expanding scope of business activities going forward, including
the operation, etc. of the three generations of railways, i.e. conventional lines, the Tokaido
Shinkansen, and the Chuo Shinkansen. This management philosophy can be found on our website.

Full disclosure

URL

https://global.jr-central.co.jp/en/company/about/outline.html• In the railway business, JR Central sets the highest priority on ensuring safe and reliable transportation. JR
Central's fundamental policy is to stably and fully execute the long-term social mission described in detailabove through the continuous efforts of providing services that are preferred by customers as well as thestreamlining of work, etc. This Management Philosophy is included in the Business Strategy of the Annual
Report, and can be found at the following URL.
Annual Report
URL

66

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

https://global.jr-central.co.jp/en/company/ir/annualreport/

Premises for ensuring theeffectiveness of the Board of
Directors and the Audit andSupervisory Board

Supplementary
principle

4-11 2

Supplementary
principle

4-11 3

Principle 4-14
Director and Audit andSupervisory training

The Board of Directors is involved in decision making processes concerning matters stipulated in relevant laws
and regulations and the articles of incorporation, matters put in their charge at a general shareholders’ meeting,and important matters related to the execution of business. A specific outline of such matters is established in therules governing the Board of Directors.
Further, the Board of Directors clearly defines the division of duties and job functions for each department
based on internal regulations, clarifies the scope of authority for Directors and corporate officers, while also
defining the division of roles of Directors and areas in which corporate officers are put in charge.
The Company determines the level of independence of Outside Directors and Outside Audit and Supervisory
Board Members based on the criteria for independence established by the Japan Exchange Group, Inc. in orderto ensure that the opinions provided by Outside Directors and Outside Audit and Supervisory Board Members on
matters raised are formed from an independent standpoint, and are based on the high degree of experience andinsight accumulated outside the Company.

Independence standards andqualification for Independent
Directors

4-11 1
Disclosu r e based on C or por at e G ov er nanc e C o d e p ri n c i p l e s

https://company.jr-central.co.jp/company/achievement/capital-investment/[2] The basic outlook on corporate governance is described in 1.1. Basic Outlook in the Corporate Governance Report.

• In the railway business, the core pillar of JR Central’s business, ensuring safe and reliable transportation is an issue ofSupplementary
principle

Establishing and Disclosing
Business Strategies andBusiness Plans

Use of Optional Approach

Key Measures and Capital Investment
URL* Corporate Governance Report can be found on the Japan Exchange Group, Inc. website.

T he r e ason s for not i m pl em ent ing t he pr i n c i p l e s o f th e c o d eGeneral principle• Specific measures to be implemented in the current business year based on this Management Philosophy
are described in Key Measures and Capital Investment, and can be found at the URL below.

Supplementary
principle

4-14 2

The appointment of Directors is conferred to General Shareholders Meetings following a resolution of the Boardof Directors concerning the appropriate election of candidates deemed to be the most fitting for the role asselected based upon a general consideration of their abilities, knowledge, and work history, etc., regardless ofage, sex and nationality. The number of Directors elected, and the division of Director roles, etc. is determinedbased on a comprehensive consideration of the level of progress of each project at the time based on a policy of
establishing the most appropriate management structure for the execution of the Company’s business activities.
The status of Directors and Audit and Supervisory Board Members holding important concurrent positions
is as described in business reports and General Shareholders Meeting Reference Materials. All currently held
positions bear no hindrance on the Director or Audit and Supervisory Board Member’s ability to fulfill the roles
and responsibilities of such a position for the Company.
The Board of Directors of the Company meets once or more a month to make legal and appropriate decisions
upon fully discussing issues stipulated by law, following conscientious briefings that are given to bring allconcerned up to speed on the background of issues discussed, and the progress status for such. Further, thestatus of the execution of duties by Directors is monitored by having Directors report back on business functions
under their charge when needed. JR Central receives valuable broad-view advice on management from Outside
Directors, which is brought into consideration in regulating the management of the Company.
Additionally, round-table conferences for opinion exchanges between Outside Directors, Outside Audit andSupervisory Board Members and members of management are set up ahead of meetings of the Board of
Directors in order to further improve the effectiveness of the Board of Directors.
Through the above-mentioned initiatives, we find at meetings of the Board of Directors that the effectiveness ofthe entire Board of Directors is ensured to a satisfactory degree.
All Directors and Audit and Supervisory Board Members of the Company have the sufficient ability and insightto fulfill their roles and responsibilities, and perform their duties with an appropriate sense of responsibility as
entrusted by all shareholders, while continuing to refine their skills and knowledge by actively participating inexternal training programs, etc.
JR Central takes necessary measures to ensure that all Directors and Audit and Supervisory Board Members
perform the duties required of them, such as in instances where relevant laws and regulations are revised, forexample, by making the content of such revisions commonly known through meetings, etc., and by holding
training events to share management issues faced by the Company so that the Company can make decisions
concerning such issues in an appropriate manner.
JR Central has established a Policy for Promoting Constructive Dialog with Shareholders as follows.
• JR Central positions the General Meeting of Shareholders as an important opportunity for dialog with shareholders andPrinciple 5-1
Policy for constructive dialog withshareholders

strives to improve the quality of questions and answers sessions in the meeting as a means of contributing to sustainablegrowth and enhancing corporate value over the mid- to long-term. All dialog with shareholders is overseen by theGeneral Manager of the Administration Department, and questions, opinions and requests are fielded from shareholders
and responded to in the form of an individual meeting or over the telephone, etc. where it is reasonable to do so.
• Of this, dialog with institutional investors is overseen by the Director General of the Corporate Planning Division, and the
IR team is placed in the Business Administration Department, Corporate Planning Division in order to further improveshareholder dialog by organically coordinating with the Administration, Finance, Legal Departments, etc. Dialog responseis the purview of the IR team, and a response is made together with members of management and Directors, where
reasonable, based on a general consideration of the requests and interests, etc. put forth by the institutional investor.
Specifically, we strive to improve upon dialog measures by not only holding individual meetings but also holding
conference calls and facility tours, etc., where necessary, in addition to holding financial results briefings quarterly.
• We also strive to enrich the broader provision of information to shareholders by sending reports on information presented
at financial results briefings biannually, on top of posting this information on our website. Moreover, we work to ensurethat a sufficient degree of information concerning decisions made on important measures and important capital
investments reaches as large a number of stakeholders as possible using the mass media services to deliver detailed
information at press conferences held by the President, and by presenting such information to the press.
• The content of discussions with shareholders is reported to members of management and, if necessary, feedback is
given to the Board of Directors.
• Under no circumstances is insider information communicated during discussions with shareholders. Furthermore, the14-day period in the lead up to the day in which financial results are announced each quarter is designated as a silent
period, in which the Company refrains from discussing financial results.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202067

GovernanceBusiness Strategy

Reasons for election

Board of Directors, Audit and Supervisory Board Members, and Corporate Officers［ as of June 23, 2020 ］

Koei Tsuge

ESG Activity Report

President
Representative Director

Shin Kaneko

Director

Torkel Patterson

Mr. Torkel Patterson has a wealth of connections overseas
through holding important positions in the U.S. government,such as special assistant to the president, as well as extensive
experience and deep insight. His ability, insight and experience
are suitable for our group to maintain sound management andfurther develop, thus we believe he is qualified for the positionof Director of our company.

Executive Vice President
Representative Director

Executive Vice President
Representative Director

Yoshiki Suyama

Shun-ichi Kosuge

Executive Vice President
Representative Director

Executive Vice President
Representative Director

Mamoru Uno (Ph.D.)

Mamoru Tanaka

overseeing the General Technology Division, and theOverseas High Speed Railway Project

overseeing the Chuo Shinkansen Promotion Division

overseeing the Railway Operations Division, and Safety
Sections

Director
Senior Corporate Executive Officer
Director General of the Chuo Shinkansen
Promotion Division

Director
Senior Corporate Executive Officer
Director General of the General Technology
Division

Takanori Mizuno

Atsuhito Mori

Director
Corporate Executive Officer
Director General of the Corporate Planning
Division

Director
Corporate Executive Officer
Director General of the Conventional Lines
Operations Division

Shunsuke Niwa

Hiroshi Suzuki

overseeing the Construction Sections

Corporate Data

Reasons for election

Director (Outside)

Takashi Saeki

Reasons for election

overseeing the Administrative Departments

Financial Information

Governance

Governance

Chairman
Representative Director

Special Feature

overseeing the Electrical Engineering Sections

Director (Outside)

Haruo Kasama

Mr. Haruo Kasama has a wealth of experience and extensive
knowledge of law through holding important positions suchas the superintending prosecutor and prosecutor generalof the Tokyo High Public Prosecutors Office. In terms ofsupervision and advice by an outside director, his ability,
insight and experience are suitable for our group to maintainsound management and further develop, thus we believe he isqualified for the position of Director of our company.

Reasons for election

Mr. Tatsuhiko Yamada has served in positions such as Manager of Funding
Section of our Company’s Finance Department and Manager of Accounting
Section of the same Department, and has made efforts to strengthen the
management foundation of our group. Currently, as Corporate Officer andGeneral Manager of the Finance Department, he is in charge of the Finance
Division of the Company, working to improve the financial strength of ourFull-time Audit and Supervisory group as a whole. As such, he possesses high-level expertise in financeand accounting. His ability, insight, and career are suitable for auditing theBoard Member
Tatsuhiko Yamada execution of duties by directors, and thus we believe he is qualified for the
position of Audit & Supervisory Board Member of the Company.

Reasons for election

Mr. Fumio Yamashita has a wealth of experience and ahigh level of insight in police administration, etc., throughhis positions such as Deputy Superintendent General of
the Metropolitan Police Department and Director-Generalof the Community Safety Bureau of the National Police
Agency. His ability, insight and experience are suitable for
Full-time Audit and Supervisory
auditing the execution of duties by directors, and thus weBoard Member (Outside)
believe he is qualitied for the position of outside Audit &Fumio Yamashita
Supervisory Board Member of the Company.

Mr. Takashi Saeki has a wealth of experience and deep insightin corporate management through holding important positions
such as president and representative director of TOHO GAS Co.,
Ltd. In terms of supervision and advice by an outside director,
his ability, insight and experience are suitable for our group to
maintain sound management and further develop, thus we believe
he is qualified for the position of Director of our company.

Reasons for election

Director (Outside)

Taku Oshima

Mr. Taku Oshima has a wealth of experience anddeep insight in corporate management through holding
important positions such as president and representative
director of NGK Insulators, Ltd. In terms of supervision
and advice by an outside director, his ability, insight andexperience are suitable for our group to maintain soundmanagement and further develop, thus we believe he isqualified for the position of Director of our company.

Reasons for election

Mr. Hajime Ishizu has a wealth of experience and a highlevel of insight in transportation administration, etc., throughhis positions as Director-General of the Kinki District
Transport Bureau and Vice-Minister for Transport andInternational Affairs of the Ministry of Land, Infrastructure,
Transport and Tourism. His ability, insight and experience
Full-time Audit and Supervisory
are suitable for auditing the execution of duties by directors,
Board Member (Outside)and thus we believe he is qualitied for the position ofHajime Ishizu
outside Audit & Supervisory Board Member of the Company.

Reasons for election

Mr. Shigeo Kifuji has a wealth of experience andextensive knowledge of law through his positions
such as Superintending Prosecutor of the Hiroshima
High Public Prosecutors Office and Superintending
Prosecutor of the Tokyo High Public Prosecutors Office.
His ability, insight and experience are suitable for
Audit and Supervisory
auditing the execution of duties by directors, and thus
Board Members (Outside)
we believe he is qualitied for the position of outside
Shigeo Kifuji
Audit & Supervisory Board Member of the Company.

Reasons for election

Mr. Kunihiro Nasu has a wealth of experience andextensive knowledge of law through his positions such asVice President of the Japan Federation of Bar Associations
and Chairman of the Aichi Prefectural Personnel Commission.
His ability, insight and experience are suitable for auditing
the execution of duties by directors, and thus we believe he
Audit and Supervisory
is qualitied for the position of outside Audit & Supervisory
Board Members (Outside)
Board Member of the Company.

Kunihiro Nasu

overseeing the Tracks and Structures Sections

Senior Corporate Executive Officers

Takanori Mizuno		
Motoaki Terai		Akihiko Ito
Atsuhito Mori

Corporate Executive Officers

Director
Corporate Executive Officer
Director General of the Shinkansen Operations
Division

Director
Corporate Executive Officer
Director General of the Business Promotion
Division

Takayuki Oyama

Hajime Kobayashi

overseeing the Rolling Stock Sections

68

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Shunsuke Niwa
Hajime Ikuta
Atsushi Honda (Ph.D.)
Hiroto Takeuchi (Ph.D.)
Hiroshi Suzuki
Takayuki Oyama
Hajime Kobayashi

Corporate Officers

Masayuki Ueno
Tatsuya Okajima
Manabu Ishibashi
Shigeki Miyamoto
Hiroshi Oshima
Yoshihiko Uchida
Masami Nitta
Masahiro Yamamoto
Masaya Sugiura
Kenichi Niimi
Atsushi Tsujimura
Hiroshi Matsuo
Kentaro Takeda
Kenji Hagihara
Ataru Kimura
Yoichiro Dendo
Takahide Saito

Masaru Yosano

Hisao Sawada
Hiroshi Shigeta
Naoki Hayakawa
Hirotaka Kawata
Kazuma Tsukamoto
Masafumi Kondo
Shunichi Usui
Yoichi Inoue
Mitsuhiro Aoki
Masami Owaki
Seigo Hatada

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

69

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Financial Information※Operating revenues by segment include sales to other segments in addition to sales to external customers.

Shifts in Operating Revenues
Transportation（Billion yen）
1,500
1,358.1

Merchandise and Other

1,380.4

1,424.0

1,461.3

1,431.2（Billion yen）
250

239.6

237.0

Real Estate

255.3

264.9

263.2

（Billion yen）
75

Other

78.0
66.0

82.1

79.9

（Billion yen）
250

68.6

1,200

200

60

200

900

150

45

150

600

100

30

100

300

50

15

50

0

’16.3

’17.3

’18.3

’19.3

0

0

’20.3

’16.3

’17.3

’18.3

’19.3

’20.3

FY2015

Operating expenses
Operating Income
Income before income taxes
Net income attributable to owners of the parent
Depreciation and amortization
Capital expenditure ※1
Total assets
Total equity
EquityEquity Ratio
Operating Income/Total Assets
Return on Equity
Earnings per Share
Annual Dividends per share

’17.3

’18.3

’19.3

253.9

261.6

261.0

’17.3

’18.3

’19.3

272.2

0

’20.3

’16.3

’20.3

Comparat ive Balance Sheet (Consolidat ed)

C o n s o l id a te dOperating Revenues

’16.3

243.0

FY2016FY2017FY2018FY2019（Billion yen）

（Billion yen）

（Billion yen）

（Billion yen）

¥1,738.4
1,159.7
578.6
508.1
337.4
242.3
238.3
5,268.5
2,352.5
2,316.3
44.0%
11.0%
15.6%

¥1,756.9
1,137.4
619.5
560.0
392.9
225.3
329.9
7,052.6
2,726.7
2,692.4
38.2%
10.1%
15.7%

¥1,822.0
1,160.0
662.0
561.8
395.5
216.0
325.6
8,908.6
3,084.7
3,055.4
34.3%
8.3%
13.8%

¥1,878.1
1,168.3
709.7
630.2
438.7
211.2
414.3
9,295.7
3,508.0
3,471.2
37.3%
7.8%
13.4%

¥1,844.6
1,188.4
656.1
573.4
397.8
214.5
463.7
9,603.1
3,872.1
3,831.8
39.9 %
6.9 %
10.9 %

（Yen）

（Yen）

（Yen）

（Yen）

（Yen）

¥1,714125¥1,996135¥2,015140¥2,238145¥2,027150

FY2015（Billion yen）

（Billion yen）

Current assets
Of these assets, the Chuo Shinkansen construction
fund management trust
Fixed assets
Tangible fixed assets
Intangible fixed assets
Investments and other assets
Total assets
Current liabilities
Fixed liabilities
Out of these liabilities, long-term debt for the Chuo Shinkansen
Total liabilities
Total net assets
Total liabilities and net assets

FY2016（Billion yen）

FY2017（Billion yen）

FY2018（Billion yen）

FY2019（Billion yen）

¥530.7¥2,191.5¥3,804.7¥3,630.6¥3,382.6-

1,472.7

2,840.9

2,670.5

2,435.0

4,737.8
4,414.7
24.2
298.8
5,268.5
639.2
2,276.7
2,915.9
2,352.5
5,268.5

4,861.1
4,488.4
32.7
339.9
7,052.6555.3
3,770.5
1,500.0
4,325.9
2,726.7
7,052.6

5,103.9
4,544.7
55.6
503.5
8,908.6602.8
5,221.1
3,000.0
5,823.9
3,084.7
8,908.6

5,665.0
4,706.6
77.5
880.8
9,295.7
650.2
5,137.4
3,000.0
5,787.6
3,508.0
9,295.7

6,220.4
4,925.1
91.1
1,204.1
9,603.1
625.6
5,105.3
3,000.0
5,731.0
3,872.1
9,603.1※1： Increase in tangible fixed assets and intangible fixed assets

N o n - c o n s o l id at ed

Operating Revenues
Railways Business
Affiliated Businesses
Operating expenses
Railways Business
Affiliated Businesses
Operating Income
Income before income taxes
Net income
Depreciation and amortization
Total capital investments
Total assets
Total equity

70

Comparative Cash Flow Statement (Consolidated)
FY2015FY2016FY2017FY2018（Billion yen）

（Billion yen）

（Billion yen）

（Billion yen）

（Billion yen）

¥1,357.9
1,349.7
8.2
800.3
794.1
6.1
557.6
491.7
328.6
227.0
259.1
5,059.4
2,219.9¥1,380.7
1,371.9
8.8
784.9
779.9
4.9
595.8
541.1
381.8
210.9
330.8
6,814.3
2,582.8¥1,427.4
1,414.8
12.5
802.1
793.5
8.6
625.2
549.5
384.4
198.6
384.5
8,726.4
2,929.8¥1,464.8
1,452.0
12.8
797.1
788.7
8.3
667.7
590.1
414.0
193.4
448.8
9,092.1
3,315.4¥1,436.9
1,422.2
14.7
813.9
805.4
8.4
623.0
539.9
378.8
195.5
499.6
9,401.2
3,658.6

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

FY2019Cash flows from operating activities
Cash flows from investing activities
Payments for purchases of tangible/intangible fixed assets, etc.
Proceeds/expenditures concerning the Chuo Shinkansen
construction fund management trust (net amount)
Proceeds and expenditures from fund management (net amount)
Cash flows from financing activities
Proceeds from long-term debt for the Chuo Shinkansen
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

FY2015FY2016FY2017FY2018（Billion yen）

（Billion yen）

（Billion yen）

（Billion yen）

FY2019（Billion yen）

¥601.4▲ 170.3▲ 252.3¥580.5▲ 1,909.5▲ 330.1¥609.5▲ 1,676.4▲ 306.9¥600.3▲ 597.5▲ 397.8¥595.2▲ 552.4▲ 459.0-▲ 1,472.7▲ 1,368.1

170.3

235.5

82.0

▲ 106.7▲ 328.9

1,425.1
1,500.0
96.2
318.3
414.5

▲ 1.3
1,434.7
1,500.0
367.8
414.5
782.4

▲ 370.0▲ 242.8▲ 33.6▲ 32.9▲ 30.8
782.4
751.6

9.7
751.6
761.3

188.3
130.0
318.3

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202071

Business Strategy

Special Feature

ESG Activity Report

Financial Information

Corporate Data

Financial Information

Financial and Transportation Data
Transportation revenues

Total（Billion yen）
1,300
1,200

1,211.9

1,192.0

1,194.5

1,175.2

1,100
1,000

Ordinary Tickets

Commuter Passes

Conventional Lines

Shinkansen

1,253.2

1,291.8

1,261.3

1,235.5

1,273.6

1,242.9（Billion yen）
120
100

105.1

103.9

102.6

69.9

69.1

104.2

104.8

17.6

17.3

16.8

20

18.4

18.1

35.1

34.8

33.9

40

35.4

35.2

’16.3

’17.3

’18.3

’19.3

’16.3

’17.3

’18.3

Passenger Ridership

Total

’19.3
Ordinary Tickets

’20.3

3,000

Commuter Passes

Shinkansen

Conventional Lines（Million passengers）
180（Million passengers）401
400

405

410

414

413

262

265

269

271

274

138

140

142

143

139

163

160
140

148

120

165

170

174

150

155

159

152

168

300
200

100

15

15

15

15

16

’16.3

’17.3

’18.3

’19.3

’20.3

20

5,045.2

4,922.2

4,801.0

4,856.2 4,851.1 4,846.0

4,125.5

3,943.4

8.0

3,665.8

6.35

6.01 6.08

6.53 6.39
6.19

5.90 5.84

5.43

10.0

4,560.8

5.21 5.16 5.08 5.01 4.91

3,455.7 3,415.6

4.75 4.62 4.51
4.30

3,260.1 3,177.6

3,369.0
3,117.0 3,001.5

2,829.1

6.0

2,614.9
2,351.7

2,136.3
4.08 3.91
3.71 3.54
1,915.6
3.36 3.24 3.14 3.13
3.10 3.12

4.0

2.00

1.66 1.65 1.64

1,000

2.0

0

0

’88.3 ’89.3 ’90.3 ’91.3 ’92.3 ’93.3 ’94.3 ’95.3 ’96.3 ’97.3 ’98.3 ’99.3 ’00.3 ’01.3 ’02.3 ’03.3 ’04.3 ’05.3 ’06.3 ’07.3 ’08.3 ’09.3 ’10.3 ’11.3 ’12.3 ’13.3 ’14.3 ’15.3 ’16.3 ’17.3 ’18.3 ’19.3 ’20.3

10
0

’16.3

’17.3

’18.3

Passenger kilometers

Total（Million passenger-kilometers）
55,00052,16650,00052,90951,45950,73445,00054,75656,27754,00953,27754,75852,467（Million passenger-kilometers）
9,302
10,0006,000

35,000

1,431

1,450

1,479

1,519

1,542

’16.3

’17.3

’18.3

’19.3

’20.3

2,000

216

Shinkansen

9,359

9,456

9,459

9,418

5,568

5,614

5,656

5,676

5,739

3,734

3,745

3,800

3,783

3,679

’16.3

’17.3

’18.3

’19.3

’20.3

0

Top 10 Stations in terms of Number of Average Daily Passengers［FY2019］（Thousandpassengers/
day）
200

Conventional Lines

Shifts in EBITDA (consolidated)（Billion yen）
900
800
700

150

600

98

100

Commuter Passes

4,000

1,000
0

Ordinary Tickets

’20.3

8,000

40,000

2,000

’19.3

Conventional Lines

Shinkansen

146

71

629.5

666.3

’11.3

’12.3

’13.3

778.1

’14.3

’15.3

821.0

844.9

878.0

’16.3

’17.3

’18.3

921.0

870.6

’19.3

’20.3

400

59
39

70

20

Nagoya

607.9

770.8

500

80

50
0

5,164.3

2,000

100

0

5,346.3 5,278.5

4,289.3

6.81

’20.3

5,456.2 5,422.3 5,392.0

4,000

0

0

（％）

5,269.3 5,223.0 5,232.7 5,195.6

20

10

Long-Term Debt
Long-Term Accounts Payable - Railway Facilities
Long-term debt for the Chuo Shinkansen
Average Interest Rate (Right axis)

12.0

5,000

68.8

69.5

60

900

Inherited Liabilities
Corporate Bonds
Latent Liabilities Born by the Shinkansen Leasing System(Non-Consolidated)（Billion yen）
6,000

68.7

80

Shifts in Total Long-Term Debt and Payables

300

37

37

24
13

Tokyo Shin-Osaka Kanayama Shizuoka Hamamatsu Kyoto

37

36

33

Kariya Shinagawa Shin-Yokohama

200
100
0
Note: EBITDA ﬁgures are calculated as the sum of operating income and depreciation and amortization

Shifts in Capital Investment Amounts (Non-consolidated)

Capital Investment Amounts (Excluding the Chuo Shinkansen)

Chuo Shinkansen

688.0（Billion yen）
650
600
550

499.6

500

448.8

450

384.5

400
350
300

277.4 265.2

250
200
150

120.3

100

159.5 174.3

197.8 211.1

166.9 164.8 171.3 172.6 159.2 156.8 151.5 157.6 161.5 169.8 155.5

209.8

330.8

288.8 298.4 301.6
244.8

229.0

257.2 259.1

128.5 128.3■ Long-Term Loan Using the Fiscal Investment and Loan Program (Long-term debt for the Chuo Shinkansen)
In November 2016, JR Central applied for a longterm loan using the Fiscal Investment and Loan Program(hereinafter,“FILP Loan”) for 3 trillion yen (plan) toJapan Railway Construction, Transport and Technology
Agency “JRTT”() to promote the construction of the
Chuo Shinkansen. We proceeded to borrow funds in fivelots sequentially thereafter and secured financing for aplanned total of 3 trillion yen in July 2017.
The advantage we gain from the FILP loan lies in
mitigating three management risks, which are interestrate increase risk, financing risk, and redemption risk.
Specifically, since we can secure long-term, fixed- andlow-interest rate funds, we are able to mitigate the risk ofinterest rates rising in the future and fix interest payments
at a low level for a long period of time.
Under the original plan, roughly 3 trillion yen of theconstruction cost for the route between Shinagawa andNagoya, which is approximately 5.5 trillion yen, wasexpected to require new financing. However, by securing
the amount through the FILP Loan, we have the funds
needed until live operation in Nagoya without being
considerably impacted by future economic conditions andinterest rate fluctuations, thereby reducing financing risk.
Furthermore, since the FILP Loan matures after theconstruction period of the Chuo Shinkansen, during
which time a large amount of funds is needed, we areable to build up cash from operating activities to provide
for the redemption of liabilities, thereby also mitigating
redemption risk.
In the material submitted to the Transport Policy
Council of the Ministry of Land, Infrastructure, Transport
and Tourism in 2010, we indicated in our outlook thata period of 8 years after live operation in Nagoya will
be set to recover management strength. After reducing
long-term debt by a certain amount, construction on theroute between Nagoya and Osaka will be initiated while
seeing that sound management and stable dividends

are strictly maintained, and ensuring that the balance oflong-term debt does not exceed 5 trillion yen throughout
the project period until live operation of the entire line.
By utilizing this FILP Loan, we are able to reduce thisperiod for restoring management strength and promote
construction efforts in an aim to moving up live operationof the entire line by up to 8 years.
The Chuo Shinkansen Project is pursued based on thepremise that JR Central, as a private corporation, covers
full cost of construction, while securing management
autonomy in investment and seeing that soundmanagement and stable dividends are strictly maintained
until the construction work is fully completed. The FILP
Loan poses no change to this premise.
As for the terms of the FILP Loan, the weighted averagerate is 0.86%, which is fixed throughout the entire period,
and the annual interest expenses are 25.7 billion yen.
The repayment method is equal principal payment over a
period of roughly 10 years after deferring the payment ofprincipal for about 30 years.
The funds procured from the FILP Loan will be applied
only for the cost of construction of the Chuo Shinkansen.
We ensure the transparency of funds by setting a trust
aimed at segment-based management.
Illustrated plan of moving up live operation
Existing plan

Move up
operation

FILP Loan

Shinagawa and Nagoya

Management strength
restoration period（8years）

Construction between

Construction between

Construction between

Shinagawa and Nagoya

Nagoya and Osaka

Construction between
Nagoya and Osaka

Live operationin Osaka

Live operationin Osaka

Equal principal
redemption overMoving up live operation by up to 8 year a period of about
10 years

Deferred ﬁxed- / low-interest for about 30 years

50 50.1
0’88.3 ’89.3 ’90.3 ’91.3 ’92.3 ’93.3 ’94.3 ’95.3 ’96.3 ’97.3 ’98.3 ’99.3 ’00.3 ’01.3 ’02.3 ’03.3 ’04.3 ’05.3 ’06.3 ’07.3 ’08.3 ’09.3 ’10.3 ’11.3 ’12.3 ’13.3 ’14.3 ’15.3 ’16.3 ’17.3 ’18.3 ’19.3 ’20.3

Note: The planned ﬁgures are as of the publication of March 2020.

72

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

’21.3

（plan）CENTRAL JAPAN RAILWAY COMPANY Annual Report 202073

Financial Section

Consolidated Balance Sheet

Central Japan Railway Company and Consolidated Subsidiaries

March 31, 2020
Thousands of
U.S. Dollars(Note 2)Millions of Yen(Note 2)ASSETS
2020

Money held in trust for the Chuo Shinkansen construction (Notes 3.c and 12)¥

761,376¥

751,636$

7,049,777

2,435,015

2,670,591

22,546,435

87,933112,845814,194

(14)

(61)

(129)

Inventories

43,92346,358406,694

Prepaid expenses and other54,44749,322504,138

Total current assets

3,382,682

3,630,692

31,321,129

Trade receivables (Note 12)
Allowance for doubtful accounts

833,406

663,350

7,716,722

Investments in and advances to unconsolidated
subsidiaries and affiliates (Note 4)

18,53917,588

171,657

Asset for retirement benefits (Note 8)

3,433

7,939

31,787

Deferred tax assets (Note 11)

176,899

170,574

1,637,953

Prepaid expenses and other262,964

98,9262,434,851

1,295,244

958,378

11,993,000

Buildings and structures

4,920,971

4,863,017

45,564,546

Machinery, rolling stock and vehicles

1,433,417

1,426,907

13,272,379

Land

2,354,868

2,354,886

21,804,333

Construction in progress

890,016

616,395

8,240,888

Other

183,416

189,859

1,698,296

9,782,690

9,451,067

90,580,462

Accumulated depreciation
Net property, plant and equipment(4,857,490)(4,744,393)(44,976,759)

4,925,199

4,706,673

45,603,694

TOTAL ASSETS (Note 5)
See notes to consolidated financial statements.

6,220,443

5,665,052

57,596,694¥ 9,603,126¥ 9,295,745$ 88,917,833¥

29,497¥28,392$

273,120

84,969110,493786,750

stock ownership plan trust (Notes 3.l, 10 and 12)

5,400

5,400

50,000Current portion of long-term accounts payable—
railway facilities (Notes 7 and 12)
Trade payables (Note 12)

5,783

5,444

53,546259,465

246,282

2,402,453

Provision for bonuses

28,44028,716263,333

Income taxes payable (Note 12)83,575

105,698

773,842

Advances received

31,615

51,113292,731

96,93568,719897,546

625,682

650,260

5,793,351

NONCURRENT LIABILITIES:Long-term debt (Notes 5 and 12)

1,222,606

1,196,732

11,320,425

Long-term debt for the Chuo Shinkansen construction (Notes 3.c, 6 and 12)

3,000,000

3,000,000

27,777,777

Long-term debt of the employee stock ownership—
plan trust (Notes 3.l, 10 and 12)Long-term accounts payable—railway facilities (Notes 7 and 12)

4,300

9,700

39,814

532,666

538,451

4,932,092

Provision for large-scale renovationof the Shinkansen infrastructure (Note 3.j)Liability for retirement benefits (Note 8)
Other (Note 11)

105,000

140,000

972,222

190,774

194,347

1,766,425

49,994

58,188462,907

5,105,341

5,137,419

47,271,675

1,037,037

CONTINGENCIES (Note 15):
EQUITY (Notes 9 and 18):
Common stock—authorized, 824,000,000 shares;
issued, 206,000,000 shares in 2020 and 2019112,000

112,000

Capital surplus

53,48653,497495,240

Retained earnings

3,755,901

3,387,569

34,776,861(111,615)(116,912)(1,033,472)

Unrealized gain on available-for-sale securities

20,72933,024

191,935

Remeasurements of defined benefit plans (Note 8)

1,331

2,116

12,324

3,831,833

3,471,294

35,479,935

40,26936,770372,861

3,872,103

3,508,065

35,852,805¥ 9,603,126¥ 9,295,745$ 88,917,833

Treasury stock—at cost, 9,644,869 shares in 2020
and 9,923,059 shares in 2019 (Notes 3.l and 10)
Accumulated other comprehensive income:

Total
Total noncurrent assets

2020

2019

Current portion of long-term debt of the employee—

Total noncurrent liabilities

Property, plant and equipment (Note 3.f):

Total

Current portion of long-term debt (Notes 5 and 12)

Total current liabilities

Investments and other assets:

Total investments and other assets

Short-term loans payable (Notes 5 and 12)

Other

NONCURRENT ASSETS:
Investment securities (Notes 4 and 12)

2020

CURRENT LIABILITIES:CURRENT ASSETS:
Cash and cash equivalents (Note 12)

Millions of Yen(Note 2)

LIABILITIES AND EQUITY

2020

2019

March 31, 2020
Thousands of
U.S. Dollars(Note 2)

Noncontrolling interests
Total equity

TOTAL LIABILITIES AND EQUITY
See notes to consolidated financial statements.

74

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202075

Financial Section

Consolidated Statement of Income

Consolidated Statement of Changes in Equity

Central Japan Railway Company and Consolidated Subsidiaries

Year Ended March 31, 2020
Thousands of
U.S. Dollars(Note 2)2018
2020

Millions of Yen(Note 2)
2020

2019

¥ 1,844,647¥ 1,878,137¥ 1,822,039$ 17,080,064

991,462
197,021970,811
197,551

966,688
193,326

9,180,203
1,824,268

1,188,483

1,168,362

1,160,015

11,004,472

Operating income

656,163

709,775

662,023

6,075,583

OTHER INCOME (EXPENSES):Interest and dividend income
Interest expense (Note 7)
Other—net (Note 3.n)

5,744
(79,906)(8,565)

4,939(80,723)(3,719)3,314(78,722)(24,762)

53,185(739,870)(79,305)

Other expenses—net(82,727)(79,503)(100,171)(765,990)

INCOME BEFORE INCOME TAXES

573,436

630,271

561,852

5,309,592

INCOME TAXES (Note 11):
Current
Deferred

172,873(3,757)

190,699(5,465)

183,663(11,710)1,600,675(34,787)

169,116

185,233

171,952

1,565,888

404,319445,037

389,899

3,743,694

6,438

6,322

(5,603)59,611OPERATING REVENUESOPERATING EXPENSES (Note 3.m):
Transportation, other services and cost of sales (Note 3.j)Selling, general and administrative expenses
Total operating expenses

Total income taxes
NET INCOME
NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTSNET INCOME ATTRIBUTABLE TO OWNERS OF THE PARENTPER SHARE OF COMMON STOCK (Note 3.t):
Basic net income
Cash dividends applicable to the year¥

397,881¥438,715¥

395,502

2020

Yen
2019

2018

¥ 2,027.86
150.00¥ 2,238.95
145.00¥ 2,015.48
140.00$ 3,684,083
U.S. Dollars
2020
$

18.78
1.39

See notes to consolidated financial statements.

Consolidated Statement of Comprehensive Income
Millions of Yen(Note 2)NET INCOME¥

OTHER COMPREHENSIVE (LOSS) INCOME (Note 16):
Unrealized (loss) gain on available-for-sale securities
Deferred gain (loss) on hedges
Remeasurements of defined benefit plans
Share of other comprehensive income in affiliates¥(13,222)

Total other comprehensive (loss) income

2019
445,037¥(122,425)(2,611)
(68)

9,521
(4)
4,704
78

(15,901)

1,175

14,299(147,231)(24,175)(629)

COMPREHENSIVE INCOME¥

388,418¥

446,213¥404,198$ 3,596,462

TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Owners of the parent
Noncontrolling interests¥

384,8023,615¥

438,691
7,521¥

409,065(4,866)$ 3,562,981
33,472

See notes to consolidated financial statements.

Millions of Yen (Note 2)
Accumulated Other
Comprehensive Income

Outstanding
Unrealized
Number ofGain onDeferred Remeasurements
Common Capital Retained Treasury Available-for- Loss on
Shares ofof Defined
Stock Surplus Earnings Stock Sale Securities Hedges Benefit Plans
Common Stock
BALANCE, APRIL 1, 2017
Net income attributable to owners of the parent
Dividends from surplus, ¥140 per share
Purchase of treasury stock
Disposal of treasury stock
Changes in the ownership interest by purchases ofshares of consolidated subsidiaries
Net change in the year
BALANCE, MARCH 31, 2018

196,799¥112,000¥53,498 ¥2,608,511 ¥(103,159)

149¥28,832(1) ¥ (7,229) ¥2,692,451¥

395,502395,502(27,580)(27,580)(21,365)(21,365)(21,365)

2,838

2,838

2,838

0

112,000¥34,277 ¥2,726,729

395,502(0)

195,826

Noncontrolling Total
Interests
EquityTotal(27,580)(1,121)(0)53,498 2,976,434 (121,687)

9,178

(2)

4,387

13,56238,011(3)(2,842) 3,055,410(0)(4,947)

8,615

29,329 3,084,739

Net income attributable to owners of the parent

438,715

438,715

438,715

Dividends from surplus, ¥140 per share
Purchase of treasury stock
Disposal of treasury stock
Changes in the ownership interest by purchases ofshares of consolidated subsidiaries
Net change in the year

(27,580)(27,580)(27,580)

BALANCE, MARCH 31, 2019

(0)

(0)

(0)

(0)

250

4,774

4,774

4,774

(0)

(0)
(4,986)

196,076

Net income attributable to owners of the parent
Dividends from surplus, ¥150 per share
Purchase of treasury stock
Disposal of treasury stock
Changes in the ownership interest by purchases ofshares of consolidated subsidiaries
Net change in the year

112,000

53,497 3,387,569 (116,912)

3

4,958

33,024(23)

2,116 3,471,294

(0)
7,440

7,417

36,770 3,508,065

397,881

397,881

397,881(29,550)(29,550)(29,550)

(0)

(0)

(0)

(0)

278

5,297

5,297

5,297

(11)

(11)
(12,294)

196,355¥112,000¥53,486 ¥3,755,901 ¥(111,615)¥20,729(785)¥(13,079)¥ 1,331 ¥3,831,833

(11)
3,498

(9,580)¥40,269 ¥3,872,103

Thousands of U.S.Dollars (Note 2)

Year Ended March 31, 2020
Thousands of
U.S. Dollars(Note 2)20182020
389,899$ 3,743,694(4,409)7
5,519
58

Year Ended March 31, 2020

Thousands

BALANCE, MARCH 31, 2020

Central Japan Railway Company and Consolidated Subsidiaries

2020
404,319

Central Japan Railway Company and Consolidated Subsidiaries

Accumulated Other
Comprehensive Income

BALANCE, MARCH 31, 2019

CommonStockCapitalSurplusTreasury
Stock

Unrealized
Gain onAvailable-forSale Securities$1,037,037$495,342 $31,366,379 $(1,082,518)$305,777

Net income attributable to owners of the parent
Dividends from surplus, $1.39 per share
Purchase of treasury stock
Disposal of treasury stock
Changes in the ownership interest by purchases ofshares of consolidated subsidiaries
Net change in the year

BALANCE, MARCH 31, 2020

Retained
Earnings

Deferred
Loss onHedges$

Noncontrolling
Interests

Total$19,592 $32,141,611

Total
Equity$340,462 $32,482,083

3,684,083

3,684,083

3,684,083(273,611)(273,611)(273,611)

(0)

(0)

(0)

49,04649,04649,046

(101)

(101)
(113,833)$1,037,037

Remeasurementsof Defined
Benefit Plans$495,240 $34,776,861 $(1,033,472)$191,935$(101)(7,268) (121,101)

32,388(88,703)$ 12,324 $35,479,935$372,861 $35,852,805

See notes to consolidated financial statements.

76

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202077

Financial Section

Consolidated Statement of Cash Flows

Notes to Consolidated Financial Statements

Central Japan Railway Company and Consolidated Subsidiaries

Year Ended March 31, 2020
Thousands of
U.S. Dollars(Note 2)2018
2020

Millions of Yen(Note 2)2020

OPERATING ACTIVITIES:
Income before income taxes
Adjustments for:
Income taxes—paidDepreciation and amortization
Equity in earnings of affiliates
Proceeds from contribution for construction
Loss on reduction of noncurrent assets
Loss on retirement of noncurrent assets
Gain on sales of noncurrent assets—net
Changes in assets and liabilities:
Decrease in provision for large-scalerenovation of Shinkansen infrastructure
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase in trade payables(Decrease) increase in advances received(Decrease) increase in liability for retirement benefits
Other—net¥

Net cash provided by operating activities
INVESTING ACTIVITIES:Payments for money held in trust for the Chuo
Shinkansen construction
Proceeds from cancellation of money held in trust
for the Chuo Shinkansen construction
Payments for money held in trust
Proceeds from redemption of marketable securities
Purchases of property, plant and equipment
Proceeds from contribution for construction
Purchases of investment securities
Proceeds from sales of investment securities
Other—net¥

630,271¥

561,852$

5,309,592(193,991)
214,517(371)(2,165)
2,549
7,804
(537)

(194,689)
211,262(294)(2,984)
3,531
8,272
(926)

(159,463)
216,027(603)(9,981)
10,222
8,746(11,737)(1,796,212)
1,986,268(3,435)(20,046)
23,601
72,259(4,972)(35,000)
24,911
2,801
393(19,497)(2,203)
22,579(35,000)(10,824)(7,697)
425
6,940
(675)
(7,292)(35,000)(7,244)(971)
17,6751,018
1,040
18,015(324,074)
230,657
25,935
3,638(180,527)(20,398)
209,064595,227

600,319609,595

5,511,361(1,500,000)

Net cash used in investing activities
FORWARD

573,436

2019¥

FINANCING ACTIVITIES:Net increase in short-term loans payable
Proceeds from long-term debt
Repayments of long-term debt
Proceeds from long-term debt for the Chuo
Shinkansen construction
Payments for long-term accounts payable—
railway facilities
Cash dividends paid
Purchases of treasury stock
Proceeds from sales of treasury stock
Cash dividends paid to noncontrolling interests
Other—net

235,576(150,000)

170,340

131,810(424,853)
5,754(196,651)
1,158(23,478)(365,446)
4,564(375,002)
15(31,973)

138,700(280,424)
3,130(142,004)
423(28,124)(552,494)(597,502)(1,676,489)

42,732¥2,817¥(1,066,893)

1,105
116,687(116,393)

882
94,543(94,543)

1,946
95,277(129,740)

2,181,259(1,388,888)(3,933,824)
53,277(1,820,842)
10,722(217,388)(5,115,685)$

395,666
10,231
1,080,435(1,077,712)

1,500,000(5,446)(29,550)
(0)
6,060
(79)
(5,376)

Net cash (used in) provided by financing activities(5,127)(27,580)
(0)
5,758
(79)
(7,486)(4,829)(27,580)(21,365)
3,056(79)
18,103(50,425)(273,611)(0)56,111(731)(49,777)(32,993)(33,635)

1,434,788(305,490)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

9,739(30,817)367,894

90,175

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

751,636

782,454414,559

6,959,592

CASH AND CASH EQUIVALENTS, END OF YEAR¥

761,376¥

751,636¥

782,454$

7,049,777

ADDITIONAL CASH FLOW INFORMATION:
Interest paid¥

79,289¥80,366¥

74,240$734,157

Central Japan Railway Company and Consolidated Subsidiaries
1.INCORPORATION OF CENTRAL JAPAN RAILWAYCOMPANY

Central Japan Railway Company (Tokai Ryokaku Tetsudo
Kabushiki Gaisha, the "Company") was incorporated on April
1, 1987, as a private business company, pursuant to the Law
for Japanese National Railways Restructuring enacted upon the
resolution of the Japanese Diet.
The business of the Japanese National Railways (the "JNR")
was succeeded by the following newly established organizations:seven railway companies including the Company, the former
Shinkansen Holding Corporation (a predecessor entity to the Railway
Development Fund (1991–1997), which was subsequently succeededby the Corporation for Advanced Transport and Technology(the "CATT") (1997–2003) and in turn by the Japan Railway
Construction, Transport and Technology Agency (the "JRTT")), theformer Railway Telecommunication Co., Ltd., Railway Information
Systems Co., Ltd., and the Railway Technical Research Institute(the "RTRI") which reorganized as a public interest corporation
as of April 1, 2011. The JNR itself became the JNR Settlement
Corporation (the "JNRSC"). All of the assets and liabilities of the
JNR were transferred to such organizations, including the JNRSC.
Prior to December 1, 2001, the Law Concerning Passenger
Railway Companies and the Japan Freight Railway Company (the"Law") required that authorization be obtained from the Ministerof Land, Infrastructure, Transport and Tourism (the "Minister ofTransport") regarding fundamentals such as: (1) commencementof business other than railway and its related business, (2) theappointment or dismissal of representative directors and corporate
auditors, (3) the issuance of new shares and bonds, (4) long-termloans payable, (5) amendments to the Articles of Incorporation,(6) operating plans, (7) sales of material assets, (8) appropriationsof earnings and (9) merger or dissolution. As of December 1,
2001, since the Law was revised and the Company was no longer
in scope of the Law, the Company was not required to obtain the
aforementioned authorizations.
On October 8, 1997, the Company's shares were listed on the
Nagoya and Tokyo stock exchanges in Japan. The JNRSC, which
held all 2,240,000 of the Company's outstanding shares prior to
the listing, sold 1,353,929 shares in the initial public offerings.
Pursuant to the Law for Disposal of Debts and Liabilities of theJNRSC enacted in October of 1998, the Company's shares held by
the JNRSC were transferred to Japan Railway Construction Public
Corporation (the "JRCPC"). On October 1, 2003, the CATT and the
JRCPC were fully integrated, pursuant to the Law of Japan Railway
Construction, Transport and Technology enacted on October 1, 2003,
and designated as the JRTT. In July 2005, the JRTT sold 600,000
shares of the Company. On April 5, 2006, the JRTT also sold its
remaining 286,071 shares of the Company. As a result of this sale,
all of the Company's shares held by the JRTT were sold.
The shares above do not reflect the effect of the hundred-for-one
stock split effective as of October 1, 2012.

2.BASIS OF PRESENTATION OF CONSOLIDATEDFINANCIAL STATEMENTS

The accompanying consolidated financial statements have been
prepared in accordance with the provisions set forth in the Japanese
Financial Instruments and Exchange Act and its related accounting
regulations, and in accordance with accounting principles generally
accepted in Japan, which are different in certain respects as to theapplication and disclosure requirements of International Financial
Reporting Standards.
In preparing these consolidated financial statements, certain
reclassifications and rearrangements have been made to theconsolidated financial statements issued domestically in order topresent them in a form which is more familiar to readers outside
Japan.
The consolidated financial statements are stated in Japanese yen,
the currency of the country in which the Company is incorporated
and operates. The translations of Japanese yen amounts into
U.S. dollar amounts are included solely for the convenience ofreaders outside Japan and have been made at the rate of ¥108 to$1, the approximate rate of exchange as of March 31, 2020. Suchtranslations should not be construed as representations that theJapanese yen amounts could be converted into U.S. dollars at thator any other rate. Japanese yen figures of less than one million
yen are rounded down to the nearest million of yen, except for per
share information, and U.S. dollar figures of less than one thousand
U.S. dollars are also rounded down to the nearest thousand of U.S.
dollars, except for per share information.

3.SUMMARY OF SIGNIFICANT ACCOUNTINGPOLICIES

a.Principles of Consolidation—The accompanying consolidated financial statements as ofMarch 31, 2020, include the accounts of the Company and its
29 (29 in 2019 and 2018) significant subsidiaries (together, the"Companies").
Under the control and influence concepts, those companies inwhich the Company, directly or indirectly, is able to exercise control
over operations are consolidated, and those companies over which
the Company has the ability to exercise significant influence areaccounted for using the equity method.
Investments in two affiliates are accounted for using the equity
method. Investments in the remaining unconsolidated subsidiaries
and affiliates are stated at cost. If the equity method of accounting
had been applied to the investments in these companies, the effecton the accompanying consolidated financial statements would not bematerial.
The difference between the cost of acquisition and the fair valueof the equity of an acquired subsidiary at the date of acquisition is
fully amortized when incurred.
All significant intercompany balances and transactions have been
eliminated in consolidation. All significant material unrealized profit

See notes to consolidated financial statements.

78

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202079

Financial Section

included in assets resulting from transactions within the Companies
is also eliminated.
A certain consolidated subsidiary has adopted a fiscal year ending
on February 28, which is different from that of the Company. The
necessary adjustments for preparing consolidated financial statements
as of the Company's year-end were appropriately made, such as
adjustments for significant intercompany accounts and transactions
which occur between the fiscal year-end of the subsidiary and that of
the Companies.
b.Cash Equivalents—Cash equivalents are short-term investments that are readily
convertible into cash and that are exposed to insignificant risk ofchanges in value. Cash equivalents include time deposits, certificatesof deposit and others, all of which mature or become due within
three months of the date of acquisition.
c.Money Held in Trust for the Chuo Shinkansen Construction andLong-Term Debt for the Chuo Shinkansen Construction— The Company has received loans from the JRTT for the further
construction of the Chuo Shinkansen, and the money is placed in thetrust fund to segregate it from other money.
d.Inventories— Inventories are stated at the lower of cost, principally determinedby the retail method for merchandise, by the specific identification
method for land and buildings held for sale in lots, by the specificidentification method for work in process and by the moving-average
cost method for materials and supplies, or net selling value.
e.Marketable and Investment Securities—Marketable and investment securities are classified andaccounted for, depending on management's intent, as follows: (1)held-to-maturity debt securities, for which there is a positive intent
and ability to hold to maturity, are reported at amortized cost; and(2) available-for-sale securities, which are not classified as theaforementioned securities, are reported at fair value, with unrealized
gains and losses, net of applicable taxes, reported in a separate
component of equity.
Nonmarketable securities classified as available-for-sale securities
are carried at cost, determined by the moving-average method. For
other-than-temporary declines in fair value, investment securities are
reduced to net realizable value by a charge to income.
f.Property, Plant and Equipment—Property, plant and equipment are stated at cost. Certain
contributions in aid for construction of railways and other property
are deducted directly from the cost of the related assets. The
accumulated contributions deducted from the cost of property, plantand equipment as of March 31, 2020 and 2019 amounted to ¥291,461
million ($2,698,712 thousand), and ¥290,680 million, respectively.
Depreciation is computed substantially by the declining-balancemethod over the estimated useful lives of the assets. Additional
depreciation is provided for the Shinkansen rolling stock based on
kilometers traveled.
The range of useful lives is principally from 2 to 60 years forbuildings and structures, and from 2 to 20 years for machinery,rolling stock and vehicles.
Depreciation of certain railway structures, except for the
Shinkansen railway facilities, is computed by the replacementaccounting method.
g.Long-Lived Assets—The Companies review their long-lived assets for impairment

80

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

whenever events or changes in circumstances indicate the carrying
amount of an asset or asset group may not be recoverable. An
impairment loss is recognized if the carrying amount of an asset or
asset group exceeds the sum of the undiscounted future cash flows
expected to result from the continued use and eventual dispositionof the asset or asset group. The impairment loss would be measured
as the amount by which the carrying amount of the asset exceeds its
recoverable amount, which is the higher of the discounted cash flows
from the continued use and eventual disposition of the asset or the
net selling price at disposition.
h.Software Costs—Software costs are amortized by the straight-line method mainly
over five years.
i.Deferred Charges—Bond issuance costs are fully charged to income as incurred.
j.Provision for Large-Scale Renovation of Shinkansen
Infrastructure—Provision for large-scale renovation of Shinkansen infrastructure
is provided based on the Nationwide Shinkansen Railway
Development Law. In accordance with the Nationwide Shinkansen
Railway Development Law and Regulations, the Company reversed
the provision in the amount of ¥35,000 million ($324,074 thousand)for the year ended March 31, 2020 and ¥35,000 million for the years
ended March 31, 2019 and 2018.
k.Retirement and Pension Plans—The Company and 28 consolidated subsidiaries have unfunded
retirement plans covering substantially all of their employees. Six
consolidated subsidiaries have noncontributory defined benefit
pension plans and one consolidated subsidiary has a defined
contribution pension plan, some of those subsidiaries also have
unfunded retirement plans. Some of the subsidiaries adopt thesimplified accounting method for calculation of liability for
retirement benefits and retirement benefit expenses.
Liability for retirement benefits is mainly calculated based on the
projected benefit obligations and plan assets at the balance sheet
date. The projected benefit obligations are attributed to periods on abenefit formula basis. Actuarial gains and losses are amortized on astraight-line basis mainly over five years, which is within the averageremaining service period. Prior service costs are amortized on astraight-line basis mainly over five years, which is within the averageremaining service period.
l.Employee stock ownership plan
—In accordance with Accounting Standards Board of Japan("ASBJ") Practical Issues Task Force No. 30, "Practical Solution on
Transactions of Delivering the Company's Own Stock to Employees
etc. through Trusts," at year-end, the Company shall record (1)the Company stock held by the employee stock ownership trust as
treasury stock in equity, (2) all other assets and liabilities of theemployee stock ownership trust on a line-by-line basis, and (3)a liability/asset for the net of (i) any gain or loss on delivery of
the stock by the employee stock ownership trust to the employee
shareholding association, (ii) dividends received from the entity forthe stock held by the employee stock ownership trust, and (iii) any
expenses relating to the employee stock ownership trust.
m.Research and Development Costs—Research and development costs are charged to income as
incurred. Research and development costs charged to income
were ¥53,986 million ($499,870 thousand), ¥55,001 million and¥58,797 million for the years ended March 31, 2020, 2019 and 2018,
respectively.
n.Other Income (Expenses)—Other income (expenses) in the consolidated statement of income
for the year ended March 31, 2018 included settlement of the railway
rolling stock production business of ¥26,445 million. As for NIPPONSHARYO, LTD., a consolidated subsidiary of the Company, the large
railway rolling stock project for the U.S.A was taken over by anothermanufacturer. Accordingly, NIPPON SHARYO, LTD. recognized aloss resulting from the conclusion of the contract to pay the settlementmoney to Sumitomo Corporation and Sumitomo Corporation ofAmericas.
o.Leases—Lease assets of finance leases that were not deemed to transfer
ownership of the leased property are depreciated and amortized by thestraight-line method over the lease period.
p.Income Taxes—The provision for income taxes is computed based on the pretax
income included in the consolidated statement of income. The asset
and liability approach is used to recognize deferred tax assets andliabilities for the expected future tax consequences of temporary
differences between the carrying amounts and the tax bases of assets
and liabilities. Deferred taxes are measured by applying currently
enacted tax laws to the temporary differences.
q.Appropriations of Retained Earnings—Appropriations of retained earnings are reflected in the
consolidated financial statements for the following year uponshareholders' approval.
r.Consumption Tax—Unless otherwise stated, all figures are presented net of tax.
s.Derivatives and Hedging Activities—The Companies use derivative financial instruments mainly to
manage exposure to market risks of changes in foreign currency
exchange rates and in interest rates. Foreign currency swaps are utilized
by the Companies to reduce foreign currency exchange rate risks.
Interest rate swaps are utilized by the Companies to reduce interest
rate risks. Interest rate and currency swap contracts are utilized by
the Companies to reduce interest rate and foreign exchange risks. The
Companies do not enter into derivatives for trading or speculative
purposes.
Foreign currency swaps, which qualify for hedge accounting andspecific matching criteria, are not remeasured at market value, but thehedged debt is translated at the contracted rates of the foreign currency
swaps. Interest rate swaps, which qualify for hedge accounting andmeet specific matching criteria, are not remeasured at market value,
but the differential paid or received under the swap agreements is
recognized and included in interest expense. When interest and currency
swap contracts meet the above criteria, hedged debt is translated at thecontracted rates, and the differential paid or received under the swap
agreement is recognized and included in interest expense.
t.Per Share Information—Basic net income per share is computed by dividing net income
attributable to owners of the parent available to common shareholders
by the weighted-average number of common shares outstanding for theperiod.
Net income attributable to owners of the parent available to commonshareholders used in the computation for 2020, 2019 and 2018 were¥397,881 million ($3,684,083 thousand), ¥438,715 million and¥395,502 million, respectively. The average number of common sharesused in the computation for 2020, 2019 and 2018 were 196,207,902
shares, 195,947,224 shares and 196,233,039 shares, respectively. The
average number of shares of the Companies held by the employee stock
ownership trust for the years ended March 31, 2020, 2019 and 2018
was 591,229 shares, 851,924 shares and 566,089 shares, respectively,
and it has been deducted from the weighted-average number of shares
outstanding during the fiscal year.
Diluted net income per share is not presented in the accompanying
consolidated financial statements as the Companies do not have any
dilutive securities.
Cash dividends per share presented in the accompanying consolidated
statement of income are dividends applicable to the respective years,
including dividends to be paid after the end of the year.
u.New accounting pronouncements—On March 31, 2020, the ASBJ issued ASBJ Statement No. 29,"Accounting Standard for Revenue Recognition," ASBJ Guidance No.
30, "Implementation Guidance on Accounting Standard for Revenue
Recognition," and ASBJ Guidance No. 19, "Implementation Guidanceon Disclosures about Fair Value of Financial Instruments." Thecore principle of the standard and guidance is that an entity should
recognize revenue to depict the transfer of promised goods or services
to customers in an amount that reflects the consideration to which theentity expects to be entitled in exchange for those goods or services. An
entity should recognize revenue in accordance with that core principle
by applying the following steps:
Step 1: Identify the contract(s) with a customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligationsin the contract
Step 5: Recognize revenue when (or as) the entity satisfies a
performance obligation
The accounting standard and guidance are effective for annual
periods beginning on or after April 1, 2021. Earlier application ispermitted for annual periods beginning on or after April 1, 2018.
The Company expects to apply the accounting standard and guidance
for annual periods beginning on April 1, 2021, and is in the process ofmeasuring the effects of applying the accounting standard and guidancein future applicable periods.
v.Accounting Changes and Error Corrections—In December 2009, the ASBJ issued ASBJ Statement No. 24,"Accounting Standard for Accounting Changes and Error Corrections"and ASBJ Guidance No. 24, "Guidance on Accounting Standard for
Accounting Changes and Error Corrections." Accounting treatments
under this standard and guidance are as follows: (1) Changes in
Accounting Policies—When a new accounting policy is appliedfollowing revision of an accounting standard, the new policy isapplied retrospectively unless the revised accounting standard
includes specific transitional provisions, in which case the entity
shall comply with the specific transitional provisions. (2) Changes
in Presentation—When the presentation of financial statements
is changed, prior-period financial statements are reclassified inaccordance with the new presentation. (3) Changes in Accounting
Estimates—A change in an accounting estimate is accounted forin the period of the change if the change affects that period only,
and is accounted for prospectively if the change affects both theperiod of the change and future periods. (4) Corrections of PriorPeriod Errors—When an error in prior-period financial statements is
discovered, those statements are restated.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202081

Financial Section

w.Supplementary Information—The consolidated operating revenues for the year ended March 31,
2020 reduced due to a decline in railway ridership owing to refraining
from going out under outbreak the COVID-19. Since the severebusiness environment is expected to be continued, a significant impact
on the consolidated operating revenue for the year ending March 31,
2021 is expected.

5. SHORT-TERM LOANS PAYABLE AND LONG-TERM DEBT

The interest rates applicable to short‑term loans payable were 0.16% as of March 31, 2020, 0.15% as of March 31, 2019, and 0.10% as of March 31, 2018.
Long-term debt held by the Company as of March 31, 2020 and 2019, consisted of the following:

2020

Millions of Yen

Thousands of
U.S. Dollars
2020

2019

The Company
Unsecured 2.39% bonds due 2026

4. INVESTMENT SECURITIESInformation regarding investment securities with readily determinable fair values classified as available-for-sale and held to maturity as of March 31,
2020 and 2019, was as follows:
Millions of Yen
2020
Cost
Securities classified as:
Available for sale:
Equity securities
Trust fund investment and other
Held to maturity
Total

¥

97,537276
689,000¥ 786,813

Unrealized
Gain¥ 38,951
50
3,002¥ 42,005

Unrealized
Loss¥ 7,5123,279¥ 10,792

Fair
Value

¥

128,976326
688,723¥ 818,026

Millions of Yen
2019
Cost
Securities classified as:
Available for sale:
Equity securities
Trust fund investment and other
Held to maturity
Total

¥

88,785276
510,000¥ 599,061

Unrealized
Gain¥ 52,603
67
4,777¥ 57,449

Unrealized
Loss¥ 3,49190¥ 3,581

Fair
Value

¥

137,897343
514,687¥ 652,928

Thousands of U.S. Dollars
2020
Cost
Securities classified as:
Available for sale:
Equity securities
Trust fund investment and other
Held to maturity
Total$ 903,120
2,555
6,379,629$7,285,305

Unrealized
Gain$ 360,657
462
27,796$ 388,935

Unrealized
Loss$ 69,555
30,361$ 99,925

Fair
Value

$ 1,194,222
3,018
6,377,064$ 7,574,314

The information for available-for-sale securities whose fair value is not readily determinable as of March 31, 2020 and 2019, is disclosed in Note 12.
The impairment loss on investment securities for the years ended March 31, 2020 and 2019 was not presented as the effect was immaterial.

¥

29,793¥29,792$275,861

Unsecured 2.31% bonds due 2027

9,994

9,993

Unsecured 2.30% bonds due 2027

4,998

4,998

46,277

Unsecured 2.39% bonds due 2028

19,99019,989185,092

Unsecured 2.391% bonds due 2028

30,00030,000277,777

Unsecured 2.646% bonds due 2038

10,00010,00092,592

Unsecured 2.166% bonds due 2029

30,00030,000277,777

Unsecured 2.312% bonds due 2029

30,00030,000277,777

Unsecured 2.556% bonds due 2039

10,00010,00092,592

Unsecured 2.321% bonds due 2029

30,00030,000277,777

Unsecured 2.157% bonds due 2029

40,00040,000370,370

Unsecured 2.375% bonds due 2039

10,00010,00092,592

Unsecured 2.212% bonds due 2030

30,00030,000277,777

Unsecured 2.111% bonds due 2030

20,00020,000185,185

Unsecured 1.797% bonds due 2030

10,00010,00092,592

Unsecured 2.083% bonds due 2031

20,00020,000185,185

Unsecured 1.895% bonds due 2031

10,00010,00092,592

Unsecured 1.824% bonds due 2032

10,00010,00092,592

Unsecured 1.725% bonds due 2033

5,000

10,00046,296

Unsecured 1.807% bonds due 2033

15,00015,000138,888

Unsecured 1.786% bonds due 2033

15,00015,000138,888

Unsecured 1.629% bonds due 2033

10,00010,00092,592

Unsecured 1.623% bonds due 2034

15,00015,000138,888

Unsecured 1.584% bonds due 2034

15,00015,000138,888

Unsecured 1.502% bonds due 2034

20,00020,000185,185

Unsecured 1.309% bonds due 2032

15,00015,000138,888

Unsecured 1.917% bonds due 2044

10,00010,00092,592

Unsecured 1.362% bonds due 2034

20,00020,000185,185

Unsecured 1.014% bonds due 2035

20,00020,000185,185

Unsecured 1.685% bonds due 2045

10,00010,00092,592

Unsecured 1.196% bonds due 2035

15,00015,000138,888

Unsecured 1.297% bonds due 2035

15,00015,000138,888

Unsecured 1.210% bonds due 2035

15,00015,000138,888

Unsecured 1.018% bonds due 2036

15,00015,000138,888

Unsecured 0.421% bonds due 2036

10,00010,00092,592

Unsecured 0.001% bonds due 2020

10,00010,00092,592

Unsecured 0.020% bonds due 2020

10,00010,00092,592

Unsecured 0.020% bonds due 2021

10,00010,00092,592

U.S. dollar 4.25% bonds due 2045 issued abroad

36,46136,440337,601

U.S. dollar 2.8% bonds due 2022 issued abroad

68,135

68,123630,879

U.S. dollar 3.40% bonds due 2023 issued abroad

38,96838,956

U.S. dollar 2.20% bonds due 2024 issued abroad

80,444

Unsecured loans from Japanese banks and others, with interest rates
		ranging from 0.61% to 4.65% (2020), from 0.61% to 4.65% (2019), due 2019 to 2045
458,788
Total

360,814744,851

533,931		
4,248,037¥ 1,307,575¥ 1,307,225$ 12,107,175(84,969)(110,493)(786,750)¥ 1,222,606¥ 1,196,732$ 11,320,425

Millions of Yen¥ 84,969
130,359
87,77785,600116,762
802,815¥ 1,308,283

Thousands of
U.S. Dollars$ 786,750
1,207,027
812,750
792,592
1,081,129
7,433,472$ 12,113,731

Less current portionLong-term debt, less current portion

92,537

There are no long-term debts held by consolidated subsidiaries as of March 31, 2020 and 2019.
Annual maturities of long-term debt outstanding at the principal amounts as of March 31, 2020, were as follows:Year Ending March 31
2021
2022
2023
2024
2025
Thereafter
Total

82

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202083

Financial Section

The Company has entrusted cash for the repayment of a portion of its outstanding bonds based on debt assumption agreements with financial institutions;however, the Company is not released from the primary responsibility for the liability by these agreements. The outstanding bonds covered by these
agreements as of March 31, 2020 and 2019, were as follows:

2020

Millions of Yen

Secured 2.600% bonds due 2020

Thousands of
U.S. Dollars
2020

2019
¥

¥ 18,995

18,995

Unsecured 2.200% bonds due 2022

18,20018,200$175,879
168,518

Unsecured 1.740% bonds due 2022

20,00020,000185,185

Unsecured 1.150% bonds due 2022

25,00025,000231,481

Unsecured 1.310% bonds due 2033

10,00010,00092,592

Unsecured 2.015% bonds due 2023

9,000

9,000

83,333

Unsecured 2.200% bonds due 2024

9,900

9,900

91,666

Unsecured 1.875% bonds due 2019
Unsecured 2.210% bonds due 2024

9,650

9,650

89,351

20,000
9,900

9,900

91,666

Unsecured 2.310% bonds due 2027

10,00010,00092,592

Unsecured 2.300% bonds due 2027

10,00010,00092,592

Unsecured 1.790% bonds due 2020

19,90019,900184,259

Unsecured 1.667% bonds due 201910,000Unsecured 1.472% bonds due 2020
Unsecured 1.725% bonds due 2033
Total

Millions of Yen

Thousands of
U.S. Dollars¥ 3,000,000$ 27,777,777¥ 3,000,000$ 27,777,777

2021
2022
2023
2024
2025
Thereafter
Total

20,000Unsecured 1.775% bonds due 2020
Unsecured 2.405% bonds due 2026

Long-term debt for the Chuo Shinkansen construction is a loan in total of ¥3,000,000 million from the JRTT using the Fiscal Investment and Loan
Program (the “FILP”) in accordance with the Order for Enforcement of the Act on the Japan Railway Construction, Transport and Technology Agency (the"JRTT Act") for the further construction of the Chuo Shinkansen.
The average interest rates of long-term debt for the Chuo Shinkansen construction as of March 31, 2020, were 0.86%.
Annual maturities of long-term debt for the Chuo Shinkansen construction as of March 31, 2020, were as follows:Year Ending March 31

49,800Unsecured 2.390% bonds due 2022

6. LONG-TERM DEBT FOR THE CHUO SHINKANSEN CONSTRUCTION

14,1005,000¥ 175,545

46,296¥ 284,445$ 1,625,416

The aforementioned bonds for which the Company entered into debt assumption agreements have been derecognized in the consolidated balance sheet anddisclosed as contingent liabilities (see Note 15).
The Company has credit commitments from banks. Total unused credit available to the Company as of March 31, 2020, was ¥100,000 million ($925,925
thousand).

7. LONG-TERM ACCOUNTS PAYABLE—RAILWAY FACILITIESLong-term accounts payable—railway facilities were incurred in the amount of ¥5,095,661 million in 1991 for the purchase of the Shinkansen railway
ground facilities and serially repaid to the JRTT. Payment terms are 25.5 years for ¥4,494,466 million and 60 years for ¥601,195 million. Payment terms andinterest rates of the payables were determined based on the agreements on the purchase of the Shinkansen railway ground facilities. The Company had paidoff ¥4,494,466 million by January 2017.
The average interest rates of long-term accounts payable—railway facilities excluding current portion as of March 31, 2020, were 6.50%.
Annual maturities of long-term accounts payable—railway facilities as of March 31, 2020, were as follows:Year Ending March 31

Millions of Yen

2021

¥

5,783

Thousands of
U.S. Dollars$

53,546

2022

6,143

56,879

2023

6,527

60,435

2024

6,936

64,222

2025

7,372

68,259505,686

4,682,277

Thereafter
Total

¥

538,449$

4,985,638

Interest expense on the aforementioned long-term accounts payable—railway facilities amounted to ¥35,219 million ($326,101 thousand), ¥35,464 millionand ¥35,839 million for the years ended March 31, 2020, 2019 and 2018, respectively.

8. RETIREMENT AND PENSION PLANS

Employees whose service with the Company and consolidated subsidiaries is terminated are entitled to retirement and pension benefits determined byreference to accumulated points during their employment calculated by their position or basic rates of pay at the time of termination, length of service
and other conditions under which the termination occurs. Some of the subsidiaries adopt the simplified accounting method for calculation of liability ofretirement benefits and retirement benefit expenses.
a. The changes in defined benefit obligation for the years ended March 31, 2020, 2019 and 2018, were as follows:

Balance at beginning of year (as previously reported)
Current service cost
Interest cost
Actuarial gains
Benefits paid
Prior service cost

Balance at end of year

2020

Millions of Yen
2019

2018

Thousands of
U.S. Dollars
2020¥216,255
15,772873(916)(18,300)(531)¥ 213,151¥222,243
15,772899(1,044)(20,840)(775)¥ 216,255¥226,417
15,768918(919)(19,888)(53)¥
222,243$2,002,361
146,037
8,083(8,481)(169,444)(4,916)$1,973,620

The retirement benefit expenses recognized by the consolidated subsidiaries, which adopt the simplified accounting method, are included in the current
service cost.
b. The changes in plan assets for the years ended March 31, 2020, 2019 and 2018, were as follows:

2020
Balance at beginning of year
Expected return on plan assets
Actuarial (losses) gains
Contributions from the employer
Benefits paid
Balance at end of year

84

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

¥29,847
368(4,953)
1,260
(711)
¥
25,810Millions of Yen
2019
¥

¥

26,890
350
2,107
1,069
(570)
29,847

2018
¥

¥

25,117
333
1,288
1,111
(960)
26,890Thousands of
U.S. Dollars
2020$276,361
3,407(45,861)
11,666(6,583)$ 238,981

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202085

Financial Sectionc. Reconciliation between the liability recorded in the consolidated balance sheet and the balances of defined benefit obligation and plan assets as of March 31,
2020 and 2019, was as follows:

2020
Funded defined benefit obligation
Plan assets
Total
Unfunded defined benefit obligation
Net liability arising from defined benefit obligation
Liability for retirement benefits
Asset for retirement benefits
Net liability arising from defined benefit obligation

Millions of Yen¥24,438(25,810)(1,372)
188,713
187,340
190,774(3,433)¥ 187,340

Thousands of
U.S. Dollars
2020

2019

$

226,277(238,981)(12,703)
1,747,342
1,734,629
1,766,425(31,787)$ 1,734,629¥23,579(29,847)(6,267)
192,675
186,407
194,347(7,939)¥186,407

d. The components of net periodic benefit costs for the years ended March 31, 2020, 2019 and 2018, were as follows:

Millions of Yen
2019

2020
Service cost
Interest cost
Expected return on plan assets
Recognized actuarial losses
Amortization of prior service (benefit) cost
Net periodic benefit costs¥15,772
873
(368)
95
(117)
¥ 16,255¥ 15,772
899
(350)
4,068
92
¥20,2962018¥ 15,768
918
(333)
4,418
24
¥20,796

Thousands of
U.S. Dollars
2020$146,037
8,083(3,407)879(1,083)$ 150,509

The retirement benefit expenses recognized by the consolidated subsidiaries, which adopt the simplified accounting method, are included in service cost.
e. Amounts recognized in other comprehensive income (before income tax effect) in respect of defined retirement benefit plans for the years ended March 31,
2020, 2019 and 2018, were as follows:

2020
Actuarial (gains) losses
Prior service cost
Total

Millions of Yen
2019

2018

¥

¥

¥(3,941)414¥ (3,527)

7,219
682
¥7,9026,626
77¥6,704

Thousands of
U.S. Dollars
2020$(36,490)
3,833$ (32,657)

f. Amounts recognized in accumulated other comprehensive income (before income tax effect) in respect of defined retirement benefit plans as of March 31,
2020 and 2019, were as follows:

2020
Unrecognized actuarial losses
Unrecognized prior service cost
Total

Millions of Yen¥1,8981,193¥ 3,091

Thousands of
U.S. Dollars
2020

2019

$17,574
11,046$28,620

¥

5,839
779
¥6,619

g. Plan assets(1) Components of plan assets
Plan assets as of March 31, 2020 and 2019, consisted of the following:
47 %
32
12
9
100 %

57 %
25
11
7
100 %

The Companies Act requires that an amount equal to 10% of dividends
must be appropriated as a legal reserve (a component of retained earnings)
or as additional paid-in capital (a component of capital surplus), dependingon the equity account charged upon the payment of such dividends, until
the aggregate amount of legal reserve and additional paid-in capital equals
to 25% of the common stock. The Company has already appropriateddefined amount as a legal reserve or additional paid-in capital. Under theCompanies Act, the total amount of additional paid-in capital and legal
reserve may be reversed without limitation. The Companies Act also
provides that common stock, legal reserve, additional paid-in capital, othercapital surplus and retained earnings-unappropriated can be transferredamong the accounts within equity under certain conditions upon resolutionof the shareholders.

c.Treasury Stock and Treasury Stock Acquisition Rights

The Companies Act also provides for companies to purchase treasury
stock and dispose of such treasury stock by resolution of the Board of
Directors. The amount of treasury stock purchased cannot exceed theamount available for distribution to the shareholders which is determined bya specific formula.
Under the Companies Act, stock acquisition rights are presented as aseparate component of equity.
The Companies Act also provides that companies can purchase bothtreasury stock acquisition rights and treasury stock. Such treasury stockacquisition rights are presented as a separate component of equity or
deducted directly from stock acquisition rights.

10.EMPLOYEE STOCK OWNERSHIP PLAN

The Company holds the Employee Stock Ownership Plan by transactions of delivering its own stock to the JR Tokai Employee Shareholding
Association (the "Shareholding Association") through trusts for the purpose of improving the employee benefit program for employees participatingin the Shareholding Association and revitalizing the Shareholding Association.
(1)Transaction outline
The Company introduced an "Employee Stock Ownership Plan (employee shareholding association purchase-type)" (the "Plan") in September
2017. To introduce the Plan, the Company, as the trustor, entered into a Stock Benefit Trust (Employee Shareholding Association Purchase-type)
Agreement (the “Trust Agreement”) with Mizuho Trust & Banking Co., Ltd. as the trustee (hereinafter the trust to be established pursuant to theTrust Agreement is referred to as the “Trust”). Mizuho Trust & Banking Co., Ltd. will enter into an agreement with Trust & Custody Services Bank,
Ltd. to re-entrust the administration of trust assets such as securities with Trust & Custody Services Bank, Ltd. as the re-trustee.
Trust & Custody Services Bank, Ltd. will collectively acquire the equivalent number of the Company’s shares that the Shareholding Association
is expected to purchase for four years after introducing the Plan, and place them in the trust account E established at Trust & Custody Services
Bank, Ltd. (“Trust Account E”), and thereafter, will sell the Company’s shares to the Shareholding Association upon its acquisition of shares. If
the amount equivalent to the net gains on the sale of the Company’s shares to the Shareholding Association by the Trust Account E accumulates
within the trust assets of the Trust by the time of termination of the Trust, such money will be distributed as the residual assets to members of the
Shareholding Association who meet the beneficiary requirements (employees).
Meanwhile, the Company will act as guarantor for the borrowing undertaken by the trust bank to purchase the Company’s shares, and will repay
any outstanding portion of the loan if there are remaining borrowings equivalent to the loss on the sale of the shares at the time of termination of
the Trust due to a decrease in the market price of the Company’s shares or otherwise.
(2)The Trust held the treasury stock and long-term debt, which was included in the consolidated balance sheet as follows:

2019

Thousands of
U.S. Dollars
2020

¥

$

78,287$

89,8142020
Mainly 0.4%
1.2% to 2.0%

Treasury stock¥(shares)Long-term debt of the employee stock ownership plan trust(444,000)

8,455(722,200)

¥

¥

9,700

2019
Mainly 0.4%
1.2% to 2.0 %2018
Mainly 0.4%
1.2% to 2.0 %i. Defined Contribution Plan
Total contribution by the Companies for the defined contribution plan was ¥134 million ($1,240 thousand) for the year ended March 31, 2020, ¥128
million for the year ended March 31, 2019, and ¥125 million for the year ended March 31, 2018.

13,753
15,100(3) Annual maturities of long-term debt of the employee stock ownership plan trust as of March 31, 2020, were as follows:Year Ending March 31
2021

Millions of Yen

Thousands of
U.S. Dollars

¥

$

2022

h. Assumptions used for the years ended March 31, 2020, 2019 and 2018, were set forth as follows:

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

b.Increases/Decreases and Transfer of Common Stock, Reserve andSurplus2020(2) Method of determining the expected rate of return on plan assets
The expected rate of return on plan assets is determined considering the current and future asset portfolio and the long-term rates of return which are
expected currently and in the future from the various components of the plan assets.

86

a.Dividends

Under the Companies Act, companies can pay dividends at any time
during the fiscal year in addition to the year-end dividend upon resolution
at the shareholders’ meeting. Additionally, for companies that meet certain
criteria including (1) having a Board of Directors, (2) having independent
auditors, (3) having an Audit & Supervisory Board, and (4) the term ofservice of the directors being prescribed as one year rather than the normal
two-year term by its articles of incorporation, the Board of Directors may
declare dividends (except for dividends-in-kind) at any time during the
fiscal year if the Company has prescribed so in its articles of incorporation.
However, the Company does not meet all the above criteria.
The Companies Act permits companies to distribute dividends-in-kind(noncash assets) to shareholders subject to a certain limitation and additional
requirements.
Semiannual interim dividends may also be paid once a year upon
resolution by the Board of Directors if the articles of incorporation of thecompany so stipulate. The Companies Act provides certain limitations
on the amounts available for dividends or the purchase of treasury stock.
The limitation is defined as the amount available for distribution to theshareholders, but the amount of equity after dividends must be maintained at
no less than ¥3 million.

2019

The employee retirement benefit trust for the Companies’ contributory pension plans accounted for 41% and 50% of total plan assets for the years ended
March 31, 2020 and 2019, respectively.

Discount rate
Expected rate of return on plan assets

Japanese companies are subject to the Companies Act of Japan (the"Companies Act"). The significant provisions in the Companies Act that
affect financial and accounting matters are summarized below:

Millions of Yen
2020

Equities
General security account
Bonds
OthersTotal

9.EQUITY

5,400
4,300

50,00039,814

2023
2024
2025
Thereafter
Total

¥

9,700

$

89,814CENTRAL JAPAN RAILWAY COMPANY Annual Report 202087

Financial Section

11. INCOME TAXESThe Companies are subject to Japanese national and local income taxes which, in the aggregate, resulted in a normal effective statutory tax rateof approximately 30.3% for the years ended March 31, 2020 and 2019, and 30.6% for the year ended March 31, 2018.
The tax effects of significant temporary differences which resulted in deferred tax assets and liabilities as of March 31, 2020 and 2019, were as
follows:
Thousands of
U.S. Dollars
Millions of Yen
2020
2019
2020
Deferred tax assets:
Depreciation and amortization¥
79,264¥
75,302$ 733,925
Liability for retirement benefits
60,061
61,742556,120
Software
13,63012,106126,203
Loss on write down of investment securities
9,855
9,726
91,250
Provision for bonuses
8,638
8,723
79,981
Unrealized profit on property, plant and equipment
7,414
7,566
68,648
Accrued railway usage charges
2,839
3,089
26,287
43,69743,173404,601
Other
Total
225,402
221,430
2,087,055(32,686)(31,368)(302,648)
Less valuation allowance
Deferred tax assets
192,716
190,061
1,784,407
Deferred tax liabilities:
Unrealized gain on available-for-sale securities
Deferred gain on transfer of certain fixed assets
Other
Deferred tax liabilities
Net deferred tax assets

10,362
4,286
3,951
18,599¥174,116¥

14,971
4,286
5,829
25,087

95,944
39,68536,583
172,212

164,974$1,612,185

Since the difference between the normal effective statutory tax rate and the actual effective tax rate was not significant, reconciliations were not presented
for the years ended March 31, 2020, 2019 and 2018.

12. FINANCIAL INSTRUMENTS AND RELATEDDISCLOSURES

a. Policy for Financial Instruments
The Companies use only financial instruments with high degrees ofsafety for the management of funds and raise funds from bank loans,bonds and others.
Derivatives are used, not for speculative purposes, but to manage
exposure to financial risks as described in Note 13.
b.Nature and Extent of Risks Arising from Financial Instruments
Money held in trust for the Chuo Shinkansen construction is set tosegregate loans from the JRTT from other cash on hand for purposes ofthe further construction of the Chuo Shinkansen. The trust property iscomprised of deposits.
Trade receivables are exposed to customer credit risk.
Investment securities, mainly held to maturity debt securities andequity instruments of customers and suppliers of the Companies, areexposed to the risk of market price fluctuations.
Payment terms of trade payables and income taxes payable arewithin one year.
Short-term bank loans are used to fund the Companies’ ongoing
operations. Bonds and long-term loans are used for renewal of longterm debt and capital spending. Please see Note 5 for a maturity
analysis for bank loans and bonds payable.
Long-term debt for the Chuo Shinkansen construction is a loan in
the amount of ¥3,000,000 million from the JRTT using the FILP in
accordance with the JRTT Act for purposes of the further constructionof the Chuo Shinkansen.
Long-term debt of the employee stock ownership plan trust is a loan
which the Trust borrowed from financial institutions.
Long-term accounts payable—railway facilities were incurred in

88

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

the amount of ¥5,095,661 million in 1991 for the purchase of the
Shinkansen railway ground facilities and serially repaid to the JRTT.
Payment terms are 25.5 years for ¥4,494,466 million and 60 years for¥601,195 million. Payment terms and interest rates of the payables
were determined based on the agreements from the purchase of the
Shinkansen railway ground facilities. The Company had paid off¥4,494,466 million by January 2017.
Derivatives include foreign currency swaps, which are used to
manage exposure to market risks of changes in foreign exchange rates
of foreign currency denominated long-term debt, and interest rate
swaps, which are used to manage exposure to market risks of changes
in interest rates of long-term debt. Please see Note 13 for details onderivatives.
c.Risk Management for Financial Instruments
Credit Risk Management
Credit risk is the risk of economic loss arising from a counterparty's
failure to repay or service debt according to the contractual terms.
The Companies manage their credit risk from trade receivables bymonitoring of payment terms and balances of major customers byeach business administration department to identify the default riskof customers in the early stage. With respect to held-to-maturity debt
securities, the Companies manage exposure to credit risk by limiting
debt securities to high credit rated bonds.
Market Risk Management
Investment securities are managed by monitoring market values andthe financial position of issuers on a regular basis.
Foreign currency swaps are used to manage exposure to market
risks of changes in exchange rates of foreign currency long-term debt.
Interest rate swaps are used to manage exposure to market risks ofchanges in interest rates of long-term debt.

d.Fair Values of Financial Instruments
Fair values of financial instruments are based on quoted prices
in active markets. If a quoted price is not available, other rational

valuation techniques are used instead. Also, please see Note 13 for thedetails of fair value for derivatives.

(1) Fair Value of Financial Instruments
March 31, 2020
Cash and cash equivalents
Money held in trust for the Chuo Shinkansen construction
Trade receivables
Investment securities
Total

Carrying AmountMillions of Yen
Fair Value¥¥

Short-term loans payable
Trade payables
Income taxes payable
Long-term debt including current potion
Long-term debt for the Chuo Shinkansen construction
Long-term debt of the employee stock ownership plan trust
including current potion
Long-term accounts payable—railway facilities
including current potion
Total

¥

¥

761,376
2,435,015
87,933
818,303
4,102,628(29,497)(259,465)(83,575)(1,307,575)(3,000,000)

761,376
2,435,015
87,933
818,026
4,102,351¥¥

(29,497)(259,465)(83,575)(1,444,883)(3,376,108)

Unrealized Gain/(Loss)

¥
¥

(276)
(276)

¥

137,308
376,108(9,700)(9,694)(5)(538,449)¥ (5,228,262)(1,172,107)¥ (6,375,331)

633,657¥ 1,147,068

March 31, 2019
Cash and cash equivalents
Money held in trust for the Chuo Shinkansen construction
Trade receivables
Investment securities
Total

Carrying AmountMillions of Yen
Fair Value¥¥

Short-term loans payable
Trade payables
Income taxes payable
Long-term debt including current potion
Long-term debt for the Chuo Shinkansen construction
Long-term debt of the employee stock
ownership plan trust including current potion
Long-term accounts payable—railway facilities
including current potion
Total

¥

Unrealized Gain/(Loss)

751,6362,670,591
112,845648,241
4,183,314¥

751,6362,670,591
112,845652,928
4,188,002¥ 4,687¥ 4,687(28,392)(246,282)(105,698)(1,307,225)(3,000,000)¥(28,392)(246,282)(105,698)(1,462,039)(3,263,563)¥154,814
263,563(15,100)(15,100)

0(543,896)¥ (5,246,593)(1,193,032)¥ (6,314,108)

649,136¥ 1,067,515¥Thousands of U.S. Dollars
Fair Value
Unrealized Gain/(Loss)

March 31, 2020
Cash and cash equivalents
Money held in trust for the Chuo Shinkansen construction
Trade receivables
Investment securities
Total

Carrying Amount
7,049,777
22,546,435
814,194
7,576,879$ 37,987,296

7,049,777
22,546,435
814,194
7,574,314$ 37,984,731

Short-term loans payable
Trade payables
Income taxes payable
Long-term debt including current potion
Long-term debt for the Chuo Shinkansen construction
Long-term debt of the employee stock
ownership plan trust including current potion
Long-term accounts payable—railway facilities
including current potion
Total

$

$

$

(273,120)(2,402,453)(773,842)(12,107,175)(27,777,777)

$

$
$

(2,555)(2,555)(273,120)(2,402,453)(773,842)(13,378,546)(31,260,259)$ 1,271,370
3,482,481(89,814)(89,759)(46)(4,985,638)$ (48,409,833)(10,852,842)$ (59,030,842)

5,867,194$ 10,621,000

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202089

Financial Section

Cash and Cash Equivalents
The carrying values of cash and cash equivalents approximate fair value
because of their short maturities.
Money Held in Trust for the Chuo Shinkansen Construction
The fair value of money held in trust for the Chuo Shinkansen
construction is determined based on financial assets which are held by thetrust property. Their carrying values approximate fair value because the trust
property consists of a deposit.
Investment Securities
The fair values of investment securities are measured at the quoted market
price of the stock exchange for the equity instruments, and at the quoted
price obtained from the financial institution for certain debt instruments.
Fair value information for investment securities by classification is includedin Note 4.
Trade Receivables and Payables, Short-Term Loans Payable andIncome Taxes Payable
The carrying values of trade receivables and payables, short-term loans
payable and income taxes payable approximate fair value because of theirshort maturities.
Long-Term Debt Including Current Portion, Long-Term Debt for the
Chuo Shinkansen Construction and Long-Term Debt of the Employee
Stock Ownership Plan Trust Including Current Portion
Domestic bonds are measured at the quoted market prices. Fair valuesof foreign currency bonds are measured in combination with foreign

currency swaps, which qualify for hedge accounting and meet specificmatching criteria and are accounted for by the method stated in Note 3.s,by discounting the total amounts of principal and interest of the bonds in
combination with foreign currency swaps at the Company's assumed bondissuing rate.
Fair values of long-term debt with floating interest rates are measured in
combination with interest rate swaps or interest rate and currency swaps,
which qualify for hedge accounting and are accounted for by the method
stated in Note 3.t, by discounting the total amounts of the principal andinterest at the Company's assumed borrowing rate.
The fair values of other debt, long-term debt for the Chuo Shinkansen
construction and long-term debt of the employee stock ownership plantrust are determined by discounting the cash flows related to the debt at theCompany's assumed bond issuing rate or corporate borrowing rate.
Long-Term Accounts Payable—Railway Facilities Including Current
PortionLong-term accounts payable represents monetary liability for purchaseof railway facilities assumed under a special law, and it is difficult for theCompany to raise funds again in the same manner. The fair value of suchlong-term accounts payable is determined based on the present value of thetotal amounts of principal and interest payment discounted at an interest rate
to be applied if similar new bonds were issued.

13.DERIVATIVESThe Companies enter into foreign currency swap agreements to manage exposure to market risks of changes in foreign exchange of foreign currency longterm debt, and interest rate swap agreements to manage exposure to market risks of changes in interest rates of certain liabilities.
Derivative transactions are mainly entered into to hedge foreign exchange exposures and interest rate exposures incorporated within their business.
Accordingly, market risk in these derivatives is basically offset by opposite movements in the value of hedged liabilities.
Because the counterparties to these derivatives are limited to major international financial institutions, the Companies do not anticipate any losses arisingfrom credit default.
Derivative transactions have been made in accordance with internal policies and have been subject to due internal formalities.

Derivative Transactions to Which Hedge Accounting Is Applied

Millions of Yen
Contract AmountMarch 31, 2020
Foreign currency swaps:(fixed amount payment in yen, fixed amount receipt in U.S. dollars)Interest rate swaps:(fixed rate payment, floating rate receipt)
Interest rate and currency swaps: (fixed rate / amount payment in yen, floating
rate receipt and fixed amount receipt in U.S. dollars )Interest rate swaps:(fixed rate payment, floating rate receipt)

March 31, 2020

Due after One Year

Fair Value

Foreign currency bonds¥224,695¥224,695*

Bank loans¥48,200¥48,200*

Foreign currency bank loans¥53,062¥53,062*

Contract AmountForeign currency swaps:(fixed amount payment in yen, fixed amount receipt in U.S. dollars)

Carrying AmountMillions of Yen
Thousands of U.S. Dollars

Contract AmountMillions of Yen
March 31, 2019

(2) Financial Instruments Whose Fair Value Cannot be Reliably Determined

Hedged Item

Interest rate and currency swaps: (fixed rate / amount payment in yen, floating
rate receipt and fixed amount receipt in U.S. dollars )Hedged Item

Contract AmountDue after One Year

Fair Value

Foreign currency bonds¥144,183¥144,183*

Bank loans¥75,500¥41,500*

Foreign currency bank loans¥53,062¥53,062*

Investments in equity instruments that do not have a quoted market price in an active market:¥ 15,103
13,316¥ 28,419

Investment securities
Investments in unconsolidated subsidiaries and affiliates
Total$ 139,842
123,296$ 263,138¥ 15,108
13,070¥ 28,178

Investments in unconsolidated subsidiaries and affiliates
Total

Foreign currency swaps:(fixed amount payment in yen, fixed amount receipt in U.S. dollars)Interest rate and currency swaps: (fixed rate / amount payment in yen, floating
rate receipt and fixed amount receipt in U.S. dollars )Investments in equity instruments that do not have a quoted market price in an active market:
Investment securities

Contract AmountMarch 31, 2020
Interest rate swaps:(fixed rate payment, floating rate receipt)

Carrying AmountMillions of Yen

March 31, 2019

Thousands of U.S. Dollars
Hedged Item

Contract AmountDue after One Year

Fair Value

Foreign currency bonds$2,080,509$2,080,509*

Bank loans$446,296$446,296*

Foreign currency bank loans$491,314$491,314** Foreign currency swaps, interest rate swaps, or interest rate and currency swaps which qualify for hedge accounting are accounted for in combination withhedged items such as the foreign currency bonds, long-term debt, or foreign currency bank loans and the fair values of these swaps are included in those ofhedged items in Note 12.

e. Maturity Analysis for Financial Assets and Securities with Contractual Maturities

Millions of Yen
March 31, 2020

Due within One Year¥

Cash and cash equivalents
Money held in trust for the Chuo Shinkansen construction
Trade receivables
Investment securities
Total

761,376
2,435,015
87,653¥ 3,284,044

Due after One Yearthrough Five Years

March 31, 2020
Cash and cash equivalents
Money held in trust for the Chuo Shinkansen construction
Trade receivables
Investment securities
Total

$

7,049,777
22,546,435
811,601$ 30,407,814¥

280
349,400¥ 349,680

Due after One Yearthrough Five Years

2,592
3,235,185$ 3,237,777¥ 339,600¥ 339,600

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

As a lessee, the minimum rental commitments under noncancelable operating leases as of March 31, 2020 and 2019, were due as follows:

Millions of Yen
2019

Thousands of
U.S. Dollars
2020

Due within one year
Due after one year

¥532
2,734

¥495
2,711

$4,925
25,314Total¥3,266¥3,207$30,240

As a lessor, the minimum rental commitments under noncancelable operating leases as of March 31, 2020 and 2019, were due as follows:

Due after Five
Years

$

$ 3,144,444$ 3,144,444

f. Annual Maturities of Long-Term Debt, Long-Term Debt for the Chuo Shinkansen Construction, Long-Term Debt of the Employee Stock Ownership
Plan Trust and Long-Term Accounts Payable—Railway Facilities
Please see Note 5 for annual maturities of long-term debt, Note 6 for long-term debt for the Chuo Shinkansen construction, Note 10 for long-term debt of
the employee stock ownership plan trust and Note 7 for long-term accounts payable—railway facilities.

90

14.LEASES

2020

Thousands of U.S. Dollars
Due within One YearDue after Five
Years

Millions of Yen
2020

2019

Thousands of
U.S. Dollars
2020

Due within one year
Due after one year¥5,438
19,673¥7,923
22,584$50,351
182,157

Total¥25,112¥30,507$232,518

15.CONTINGENCIESAs of March 31, 2020, the Company has joint and several obligations with the RTRI to make payments on long-term debt of ¥1,508 million ($13,962
thousand) borrowed by the RTRI. The proceeds are being used for the enhancement of technological development of the Maglev system. In addition, as ofMarch 31, 2020, the Company is contingently liable for guarantees of loans of RTRI amounting to ¥13,400 million ($124,074 thousand).
As discussed in Note 5, based on debt assumption agreements with financial institutions, the Company has transferred the debt repayment obligations forcertain bonds to such financial institutions. As of March 31, 2020, the Company had contingent obligations of ¥175,545 million ($1,625,416 thousand) forthe bonds.

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202091

Financial Section

16.OTHER COMPREHENSIVE (LOSS) INCOME

Millions of Yen
2019

The components of other comprehensive (loss) income for the years ended March 31, 2020, 2019 and 2018, were as follows:

2018

Thousands of
U.S. Dollars
2020(5,850)1,440¥(4,409)¥13,824(0)13,824(4,303)¥9,521$(167,250)
3,444(163,805)
41,379$(122,425)

¥

¥7
7

¥(4)
(4)

$

¥

¥7

¥

$

¥(3,505)(21)(3,527)916¥(2,611)

¥

3,927
3,975
7,902
(2,382)¥5,519

¥

2,261
4,442
6,704
(1,999)¥4,704$ (32,453)(194)(32,657)
8,481$(24,175)¥(206)137¥(68)

¥41
16
¥58

¥39
38
¥78

$(1,907)
1,268$(629)¥(15,901)¥1,175¥14,299$(147,231)

Millions of Yen
2019

2020
Unrealized (loss) gain on available-for-sale securities:(Loss) gain arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effect
Total
Deferred gain (loss) on hedges:
Gain (loss) arising during the year
Amount before income tax effect
Income tax effectTotal
Remeasurements of defined benefit plans:
Adjustments arising during the year
Reclassification adjustments to profit
Amount before income tax effect
Income tax effect
Total
Share of other comprehensive income in affiliates(Loss) gain arising during the year
Reclassification adjustments to profit
Total
Total other comprehensive (loss) income

17.SEGMENT INFORMATION

Under ASBJ Statement No. 17, "Accounting Standard for Segment
Information Disclosures" and ASBJ Guidance No. 20, "Guidance on
Accounting Standard for Segment Information Disclosures," an entity isrequired to report financial and descriptive information about its reportablesegments. Reportable segments are operating segments or aggregationsof operating segments that meet specified criteria. Operating segments
are components of an entity for which separate financial information isavailable and such information is evaluated regularly by the chief operating
decisionmaker in deciding how to allocate resources and in assessing
performance. Generally, segment information is required to be reported
on the same basis as is used internally for evaluating operating segment
performance and deciding how to allocate resources to operating segments.
a. Description of Reportable Segments
The Companies' reportable segments are those for which separate
financial information is available and regular evaluation by the Companies'
management is being performed in order to decide how resources areallocated among the Companies.

¥(18,063)
372(17,691)
4,469¥(13,222)¥(5,850)(4)

The Companies are composed of three reportable segments by natureof products and services: Transportation, Merchandise and Other and Real
Estate are disclosed.
The Transportation segment manages the Companies' railway operations,such as the Tokaido Shinkansen and conventional railway operations in the
Tokai area, bus operations and others. The Merchandise and Other segment
includes a department store in JR Central Towers, retail sales in trains andstations and others. The Real Estate segment include real estate leasing
business, such as station building leasing and real estate sales in lots.
b. Methods of Measurement for the Amounts of Operating Revenues,
Profit (Loss), Assets, Liabilities and Other Items for Each Reportable
Segment
The accounting policies of each reportable segment are consistent
with those disclosed in Note 3, "Summary of Significant Accounting
Policies." Reportable segment profit represents operating income. Prices
of intersegment transactions or transfers are determined based upon arm's
length transactions.

c. Information about Operating Revenues, Profit (Loss), Assets, Liabilities and Other Items

Millions of Yen
2020

Operating revenues:
External customers
Intersegment transactions or transfers
Total

Reportable Segment
Transportation Merchandise and Other Real Estate

Total

Other

Total

Reconciliations Consolidated¥1,419,006 ¥250,111 ¥47,487 ¥1,716,605 ¥128,042 ¥1,844,647¥1,844,647
12,26013,16032,51057,932
144,220
202,152 ¥(202,152)¥1,431,266 ¥ 263,272 ¥ 79,998 ¥1,774,537 ¥ 272,263 ¥2,046,800 ¥ (202,152) ¥1,844,647

Segment profit¥617,643 ¥7,401 ¥19,004 ¥644,049 ¥13,512 ¥657,561 ¥ (1,398) ¥656,163
Segment assets
8,833,470
126,572
364,996 9,325,039
412,213 9,737,253 (134,126) 9,603,126
Other:
Depreciation and amortization
188,343
3,946
16,851
209,1415,376
214,517214,517
Amounts of investments in equity in affiliates
10,155
10,155
10,155
10,155
Increase in property, plant and equipment
and intangible assets
438,422
5,842
10,859455,1248,600
463,725
463,72592

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

Operating revenues:
External customers
Intersegment transactions or transfers
Total

Reportable Segment
Transportation Merchandise and Other Real Estate

Total

Other

Total

Reconciliations Consolidated¥1,449,198 ¥253,312 ¥49,646 ¥1,752,156 ¥125,980 ¥1,878,137¥1,878,137
12,146
11,672
32,48856,307135,090
191,398 ¥(191,398)¥1,461,345 ¥ 264,984 ¥ 82,134 ¥1,808,464 ¥ 261,071 ¥2,069,535 ¥ (191,398) ¥1,878,137

Segment profit¥664,897 ¥9,638 ¥20,279 ¥694,814 ¥16,103 ¥710,918 ¥ (1,143) ¥709,775
Segment assets
8,711,224
127,619
370,244 9,209,088
408,015 9,617,103 (321,358) 9,295,745
Other:
Depreciation and amortization
186,166
4,101
16,930207,198
4,064
211,262
211,262
Amounts of investments in equity in affiliates
9,909
9,909
9,909
9,909
Increase in property, plant and equipment
and intangible assets
392,471
2,999
10,436405,907
8,492
414,399
414,399
Millions of Yen
2018

Operating revenues:
External customers
Intersegment transactions or transfers
Total

Reportable Segment
Transportation Merchandise and Other Real Estate

Total

Other

Total

Reconciliations Consolidated¥1,412,182 ¥243,228 ¥46,117 ¥1,701,528 ¥120,510 ¥1,822,039¥1,822,039
11,86912,16431,90255,936
141,115
197,052 ¥(197,052)¥1,424,051 ¥255,393 ¥78,020 ¥1,757,465 ¥261,626 ¥2,019,091 ¥(197,052) ¥1,822,039

Segment profit¥623,077 ¥8,224 ¥18,534 ¥649,836 ¥13,208 ¥663,045 ¥ (1,021) ¥662,023
Segment assets
8,191,415
119,640
371,961 8,683,018
398,838 9,081,856 (173,173) 8,908,682
Other:
Depreciation and amortization
190,7634,009
17,164211,936
4,090
216,027
216,027
Amounts of investments in equity in affiliates
9,648
9,648
9,648
9,648
Increase in property, plant and equipment
and intangible assets
305,974
5,732
8,673
320,379
5,224
325,604
325,604
Thousands of U.S. Dollars
2020

Operating revenues:
External customers
Intersegment transactions or transfers
Total

Reportable Segment
Transportation Merchandise and Other Real Estate$ 13,138,944 $ 2,315,842 $
113,518
121,851$ 13,252,462 $ 2,437,703 $

Total

Other

Total

Reconciliations Consolidated

439,694 $ 15,894,490 $ 1,185,574 $ 17,080,064$ 17,080,064
301,018
536,407
1,335,370
1,871,777 $(1,871,777)
740,722 $ 16,430,898 $ 2,520,953 $ 18,951,851 $(1,871,777) $ 17,080,064

Segment profit$ 5,718,916 $
68,527 $ 175,962 $ 5,963,416 $ 125,111 $ 6,088,527 $ (12,944) $ 6,075,583
Segment assets
81,791,388
1,171,962
3,379,592 86,342,953
3,816,787 90,159,750 (1,241,907) 88,917,833
Other:
Depreciation and amortization
1,743,916
36,537156,027 1,936,490
49,777 1,986,268
1,986,268
Amounts of investments in equity in affiliates
94,02794,02794,02794,027
Increase in property,plant and equipment
and intangible assets
4,059,462
54,092
100,546 4,214,111
79,629 4,293,750
4,293,750
Notes: 1. Other includes business in hotel, travel, advertising, rolling stock production, construction, etc., which are not included in a any reportable segment.
2. Reconciliations are as follows:a. The amount of elimination of intersegment transactions included in the reconciliations was ¥(1,398) million ($(12,944) thousand), ¥(1,143) million and ¥(1,021) million for the years ended March 31, 2020, 2019 and 2018, respectively.
b. The reconciliations for segment assets include corporate assets, which are not allocated to a reportable segment, and the elimination of intersegment transactions.
Corporate assets principally consist of investment securities and certificates of deposit. The amounts of corporate assets were ¥478,047 million ($4,426,361 thousand), ¥288,709 million and ¥441,612 million for the years ended March 31, 2020, 2019and 2018, respectively.
The elimination of intersegment transactions consists of intersegment receivables and others. The amounts of the elimination were ¥612,174 million ($5,668,277 thousand), ¥610,068 million and ¥614,785 million for the years ended March 31, 2020,2019 and 2018, respectively.
3. Segment profit is reconciled to operating income in the consolidated statement of income.
4. I nformation about products and services was omitted since equivalent information was disclosed above.
Information about geographical areas was not presented since the Companies have no significant overseas operations.

18.SUBSEQUENT EVENTSAppropriations of Retained Earnings
The following appropriation of retained earnings as of March 31, 2020, was approved at the Company's shareholders’ meeting held on June 23, 2020. The
total amount of dividends includes ¥33 million ($305 thousand) in dividends to be paid to the Trust.

Year-end cash dividends, ¥75 ($0.69) per share

Millions of Yen¥ 14,775

Thousands of U.S. Dollars$ 136,805

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202093

Financial Section

Nonconsolidated Balance Sheet (Unaudited)

Nonconsolidated Statement of Income (Unaudited)Central Japan Railway Company
Millions of Yen(Note 1)ASSETS
CURRENT ASSETS:

Cash and cash equivalents
Money held in trust for the Chuo Shinkansen construction
Trade receivables
Supplies
Prepaid expenses and otherTotal current assets

2020
¥

2019

745,535
2,435,015
40,34914,04550,9203,285,865¥

740,989
2,670,591
57,96713,01945,5983,528,165

March 31, 2020
Thousands of
U.S. Dollars(Note 1)
$6,903,101
22,546,435
373,601130,046
471,481
30,424,675

Total noncurrent assets¥815,715
221,255
163,736
198,013
1,398,720

642,676
227,964
156,91047,902
1,075,453

7,552,916
2,048,657
1,516,074
1,833,453
12,951,111

8,147,341
932,833
221,404
9,301,579(4,584,886)
4,716,693

8,104,274
647,505
219,545
8,971,325(4,482,824)
4,488,500

75,438,342
8,637,342
2,050,037
86,125,731(42,452,648)
43,673,083

6,115,413

5,563,954

56,624,194

9,401,279¥ 9,092,120$ 87,048,879

Millions of Yen(Note 1)

LIABILITIES AND EQUITY
Short-term loans payable
Current portion of long-term debt
Current portion of long-term debt of the employee stock ownership plan trust
Current portion of long-term accounts payable-railway facilities
Trade payables
Provision for bonuses
Income taxes payable
Prepaid fares received
Inter-line fares received
Other
Total current liabilities

2020

2019

¥ 1,422,208
14,7881,436,996¥ 1,452,005
12,881
1,464,886¥ 1,414,884
12,5601,427,444$ 13,168,592
136,925
13,305,518

Railway business
Other
Total operating expenses

805,474
8,471
813,946788,7548,386
797,140

793,541
8,608
802,150

7,458,092
78,435
7,536,537

Operating income

623,050

667,745625,293

5,768,981

3,628(80,514)(6,221)(83,107)

3,636(81,271)
86(77,548)

3,194(79,105)
208(75,702)33,592(745,500)(57,601)(769,509)

539,942

590,197549,591

4,999,462

164,165(3,065)
161,099

179,709(3,557)
176,151

172,961(7,780)165,1811,520,046(28,379)
1,491,657

378,842¥ 414,045

384,410$ 3,507,796
U.S. Dollars
2020

OPERATING REVENUES:
Railway business
Other
Total operating revenues

OPERATING EXPENSES:

Investments and other assets:
Investment securities
Investments in and advances to subsidiaries and affiliates
Deferred tax assets
Prepaid expenses and otherTotal investments and other assets
Property, plant and equipment (Note 2):
Railway business property
Construction in progress
Other
Total
Accumulated depreciation
Net property, plant and equipment

CURRENT LIABILITIES:Year Ended March 31, 2020
Thousands of
U.S. Dollars(Note 1)
2018
2020

Millions of Yen(Note 1)2020

NONCURRENT ASSETS:TOTAL ASSETS

Central Japan Railway Company

2020
¥

NONCURRENT LIABILITIES:Long-term debt
Long-term debt for the Chuo Shinkansen construction
Long-term debt of the employee stock ownership plan trust
Long-term accounts payable-railway facilities
Provision for large-scale renovation of the Shinkansen infrastructure
Provision for retirement benefits
Other
Total noncurrent liabilities

156,068
84,9695,400
5,783
224,701
20,72678,912
16,46533,44655,364
681,8382019¥

158,540
110,493
5,400
5,444
197,565
21,334
98,502
34,103
188
56,989688,562

Thousands of
U.S. Dollars(Note 1)2020

$1,445,074
786,750
50,00053,5462,080,564
191,907730,666
152,453
309,685
512,629
6,313,314

1,222,606
3,000,000
4,300
532,666
105,000
174,594
21,6455,060,812

1,196,732
3,000,000
9,700
538,451
140,000
177,815
25,3595,088,058

11,320,425
27,777,777
39,814
4,932,092
972,222
1,616,611
200,416
46,859,370

112,000
53,500112,000
53,5001,037,037
495,370

12,504
3,573,154(110,661)
18,1293,658,628

12,504
3,223,861(115,959)
29,5913,315,499

115,777
33,084,759(1,024,638)
167,861
33,876,185

9,401,279¥ 9,092,120$ 87,048,879

OTHER INCOME (EXPENSES):Interest and dividend income
Interest expense
Other—net
Other expenses—net

INCOME BEFORE INCOME TAXESINCOME TAXES:
Current
Deferred
Total income taxes

NET INCOMEPER SHARE OF COMMON STOCK:
Basic net income
Cash dividends applicable to the year

¥

¥

2020

Yen
2019

2018

¥ 1,928.84
150.00¥ 2,110.87
145.00¥ 1,956.94
140.00

$

17.86
1.39

See notes to nonconsolidated financial statements.

EQUITY:

Common stock-authorized, 824,000,000 shares;
issued, 206,000,000 shares in 2020 and 2019
Capital surplus
Retained earnings:
Legal reserve
UnappropriatedTreasury stock-at cost, 9,443,249 shares in 2020 and 9,721,439 shares in 2019
Unrealized gain on available-for-sale securities
Total equity

TOTAL LIABILITIES AND EQUITY¥

See notes to nonconsolidated financial statements.

94

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202095

Financial Section

Nonconsolidated Statement of Changes in Equity (Unaudited)Central Japan Railway Company

BALANCE, APRIL 1, 2017

Notes to Nonconsolidated Financial Statements (Unaudited)Year Ended March 31, 2020
Thousands
Outstanding
Number of
Shares ofCommon Stock
197,000

Net income
Dividends from surplus, ¥140 per share
Purchase of treasury stock
Disposal of treasury stock
Net change in the year

BALANCE, MARCH 31, 2018

CapitalSurplus53,500(1,121)
149

196,027(21,365)
2,838

112,000

53,50012,504

2,837,396(120,733)(0)250

196,278

8,736

8,736

35,2112,929,880(5,620)414,045(27,580)(0)4,774(5,620)(0)
4,774

112,000

53,50012,504

3,223,861

29,5913,315,499(11,461)

378,842(29,550)(0)
5,297(11,461)

378,842(29,550)

(0)

(0)
5,297

278

196,556(115,959)

Total
Equity2,582,839
384,410(27,580)(21,365)2,838

414,045(27,580)

Net income
Dividends from surplus, ¥150 per share
Purchase of treasury stock
Disposal of treasury stock
Net change in the year

BALANCE, MARCH 31, 2020

CommonStock112,000

Unrealized
Gain onRetained Earnings
Legal
Treasury Available-for-SaleReserve Unappropriated
Stock
Securities
12,504 2,480,566 (102,205)
26,474384,410(27,580)

Net income
Dividends from surplus, ¥140 per share
Purchase of treasury stock
Disposal of treasury stock
Net change in the year

BALANCE, MARCH 31, 2019

Millions of Yen (Note 1)¥112,000 ¥53,500 ¥12,504 ¥3,573,154 ¥(110,661) ¥18,129 ¥3,658,628
Thousands of U.S. Dollars (Note 1)

BALANCE, MARCH 31, 2019

Unrealized
Gain onRetained Earnings
CommonCapitalLegal
Treasury Available-for-Sale
Total
Stock
SurplusReserve Unappropriated
Stock
Securities
Equity$1,037,037 $495,370 $115,777 $29,850,564 $(1,073,694) $273,990 $30,699,064

Net income
Dividends from surplus, $1.39 per share
Purchase of treasury stock
Disposal of treasury stock
Net change in the year

BALANCE, MARCH 31, 2020

3,507,796(273,611)(0)49,046(106,120)$ 1,037,037$ 495,370$ 115,777 $33,084,759 $(1,024,638)

Central Japan Railway Company
1. BASIS OF PRESENTATION OF NONCONSOLIDATEDFINANCIAL STATEMENTS

The accompanying nonconsolidated financial statements have been
prepared in accordance with the provisions set forth in the Companies
Act, the Japanese Financial Instruments and Exchange Act, the Law for
Railway Business Enterprise and their related accounting regulations,and in accordance with accounting principles generally accepted inJapan, which are different in certain respects as to the application anddisclosure requirements of International Financial Reporting Standards.
In preparing these nonconsolidated financial statements, certain
reclassifications and rearrangements have been made to thenonconsolidated financial statements issued domestically in order topresent them in a form which is more familiar to readers outside Japan.

The nonconsolidated financial statements are stated in Japanese yen,
the currency of the country in which the Company is incorporated andoperates. The translations of Japanese yen amounts into U.S. dollar
amounts are included solely for the convenience of readers outside
Japan and have been made at the rate of ¥108 to $1, the approximate
rate of exchange as of March 31, 2020. Such translations should not
be construed as representations that the Japanese yen amounts could
be converted into U.S. dollars at that or any other rate. Japanese yen
figures of less than one million yen are rounded down to the nearest
million of yen, except for per share information, and U.S. dollar figuresof less than one thousand U.S. dollars are also rounded down to thenearest thousand of U.S. dollars, except for per share information.

2. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment as of March 31, 2020 and 2019, consisted of the following:
Millions of Yen
Land
Buildings
Structures
Rolling stock
Machinery and equipment
Lease assets
Construction in progress
Total
Accumulated depreciation
Net property, plant and equipment

2020¥ 2,327,112
622,306
3,852,722
906,918
656,2363,448
932,833
9,301,579(4,584,886)¥ 4,716,693

2019¥ 2,326,941
612,049
3,816,563
906,235
658,8223,207
647,505
8,971,325(4,482,824)¥ 4,488,500

Thousands of
U.S. Dollars
2020$ 21,547,333
5,762,092
35,673,351
8,397,388
6,076,259
31,925
8,637,342
86,125,731(42,452,648)$43,673,083

Property, plant and equipment are stated at cost.
Depreciation is computed by the declining-balance method over the estimated useful lives of the assets. Additional depreciation is provided for the
Shinkansen rolling stock based on kilometers traveled.
The range of useful lives is principally from 3 to 50 years for buildings, from 4 to 60 years for structures, from 10 to 20 years for rolling stock and from 4
to 17 years for machinery and equipment.
Depreciation of certain railway structures, except for the Shinkansen railway facilities, is computed by the replacement-accounting method.

3,507,796(273,611)(0)49,046(106,120)$ 167,861 $ 33,876,185

See notes to nonconsolidated financial statements.

96

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 202097

Financial Section

Deloitte Touche Tohmatsu LLC
JP TOWER NAGOYA
1-1-1 Meieki, Nakamura-ku
Nagoya, Aichi 450-8530
Japan
Tel: +81(52)565 5511 Fax:+81(52)569 1394
www.deloitte.com/jp/en

INDEPENDENT AUDITOR’S REPORTTo the Board of Directors ofCentral Japan Railway Company:
OpinionWe have audited the consolidated financial statementsof Central Japan Railway Company and its consolidated
subsidiaries (the "Companies"), which comprise theconsolidated balance sheet as of March 31, 2020, and theconsolidated statement of income, consolidated statement ofcomprehensive income, consolidated statement of changes
in equity and consolidated statement of cash flows for theyear then ended, and notes to the consolidated financial
statements, including a summary of significant accounting
policies, all expressed in Japanese yen.
In our opinion, the accompanying consolidated financial
statements present fairly, in all material respects, theconsolidated financial position of the Companies as of March
31, 2020, and its consolidated financial performance and its
consolidated cash flows for the year then ended in accordancewith accounting principles generally accepted in Japan.
Convenience Translation
Our audit also comprehended the translation of Japanese
yen amounts into U.S. dollar amounts and, in our opinion,such translation has been made in accordance with the basis
stated in Note 2 to the consolidated financial statements. Such
U.S. dollar amounts are presented solely for the convenienceof readers outside Japan.
Basis for Opinion
We conducted our audit in accordance with auditing
standards generally accepted in Japan. Our responsibilities
under those standards are further described in the Auditor's
Responsibilities for the Audit of the Consolidated Financial
Statements section of our report. We are independent of theCompanies in accordance with the provisions of the Code ofProfessional Ethics in Japan, and we have fulfilled our otherethical responsibilities as auditors. We believe that the audit
evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.
Responsibilities of Management and Audit & Supervisory
Board Members and the Audit & Supervisory Board for
the Consolidated Financial Statements
Management is responsible for the preparation and fairpresentation of the consolidated financial statements inaccordance with accounting principles generally acceptedin Japan, and for such internal control as management
determines is necessary to enable the preparation of
consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements,
98

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

management is responsible for assessing the Companies'
ability to continue as a going concern, disclosing, asapplicable, matters related to going concern in accordancewith accounting principles generally accepted in Japanand using the going concern basis of accounting unlessmanagement either intends to liquidate the Companies or tocease operations, or has no realistic alternative but to do so.
Audit & Supervisory Board members and the Audit& Supervisory Board are responsible for overseeing the
Directors' execution of duties relating to the design andoperating effectiveness of the controls over the Companies'
financial reporting process.
Auditor's Responsibilities for the Audit of theConsolidated Financial Statements
Our objectives are to obtain reasonable assurance about
whether the consolidated financial statements as a whole
are free from material misstatement, whether due to fraud
or error, and to issue an auditor's report that includes
our opinion. Reasonable assurance is a high level ofassurance, but is not a guarantee that an audit conducted inaccordance with auditing standards generally accepted inJapan will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated
financial statements.
As part of an audit in accordance with auditing standards
generally accepted in Japan, we exercise professional
judgment and maintain professional skepticism throughout
the audit. We also:• Identify and assess the risks of material misstatementof the consolidated financial statements, whether due to fraud
or error, design and perform audit procedures responsive tothose risks. The procedures selected depend on the auditor's
judgement. In addition, we obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
• Obtain, when performing risk assessment procedures,
an understanding of internal control relevant to the audit
in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the Companies' internal
control.
• Evaluate the appropriateness of accounting policies
used and the reasonableness of accounting estimates andrelated disclosures made by management.

• Conclude on the appropriateness of management's
use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant
doubt on the Companies' ability to continue as a going
concern. If we conclude that a material uncertainty exists, weare required to draw attention in our auditor's report to therelated disclosures in the consolidated financial statements
or, if such disclosures are inadequate, to modify our opinion.
Our conclusions are based on the audit evidence obtained up
to the date of our auditor's report. However, future events orconditions may cause the Companies to cease to continue asa going concern.
• Evaluate whether the overall presentation anddisclosures of the consolidated financial statements are inaccordance with accounting principles generally acceptedin Japan, as well as the overall presentation, structure andcontent of the consolidated financial statements, including
the disclosures, and whether the consolidated financial
statements represent the underlying transactions and eventsin a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding
the financial information of the entities or businessactivities within the Companies to express an opinion on the
consolidated financial statements. We are responsible for the
direction, supervision and performance of the group audit.
We remain solely responsible for our audit opinion.
We communicate with Audit & Supervisory Board
members and the Audit & Supervisory Board regarding,among other matters, the planned scope and timing of theaudit and significant audit findings, including any significant
deficiencies in internal control that we identify during our
audit.
We also provide Audit & Supervisory Board members
and the Audit & Supervisory Board with a statement that wehave complied with relevant ethical requirements regarding
independence, and communicate with them all relationships
and other matters that may reasonably be thought to bear on
our independence, and where applicable, related safeguards.
Interest Required to Be Disclosed by the Certified Public
Accountants Act of Japan
Our firm and its designated engagement partners do nothave any interest in the Companies which is required to bedisclosed pursuant to the provisions of the Certified Public
Accountants Act of Japan.

Hiroki Kitagata
Designated Engagement Partner
Certified Public Accountant

Haruhisa Suzuki
Designated Engagement Partner
Certified Public Accountant

Shumpei Kano
Designated Engagement Partner
Certified Public Accountant

June 23, 2020

Member of
Deloitte Touche Tohmatsu Limited

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

99

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

Corporate Data▶

P ro fil e

Name

▶

CENTRAL JAPAN RAILWAY COMPANY (JR Central)
Central Japan Railway Company (JR Central)

Established

Head Office andOther Main Offices

April 1, 1987

Business activities Railways business, Affiliated businesses
Key data(As of the end of March 2020)
Capital112.0 billion yen

Operating Revenues

1,436.9 billion yen

Number of Shares Outstanding

206 million

Share Listings

Nagoya / Tokyo Stock Exchange

Number of Shareholders

92,828

Number of Employees

18,282

Operating Kilometers

1,970.8km

Number of Stations

405

Number of Rolling Stock4,828

Double-and Multi-Tracked Section

55.1% (1,086.8km)

Electrified Section

76.7% (1,511.0km)

CTC System Adoption Rate

97.5% (1,922.3km)

Automatic Signaling System
Adoption Rate

97.8% (1,927.3km)

Head Office

Head Office (Tokyo)

Meieki 1-1-4, Nakamura-ku, Nagoya-shi,

Operations Division
Shizuoka Branch Office
Mie Regional Office

JR Central operates the Tokaido Shinkansen, theAichi 450-6101, JapanJR Central Towers

main transportation artery linking Tokyo, Nagoya,

JR Central Shinagawa Building A Wing 2-1-85,

and Osaka, and a network of 12 conventional lines

Konan, Minato-ku, Tokyo 108-8204, Japan
Conventional Lines

Operat ing Area

centered on the Nagoya and Shizuoka City areas.

Area of Japan: Approx. 380,000km2
Population: 127 million

Nakamura-ku, Nagoya-shi, Aichi 453-8520, Japan(As of January 1, 2020)

4, Kurogane-cho, Aoi-ku, Shizuoka-shi,
Shizuoka 420-0851, Japan
Ust-Tsu 12F, 700, Hadokoro-cho, Tsu-shi,

JR-CENTRAL

Shinkansen

Kyoto

Conventional Lines

Mie 514-0009, Japan
Iida Regional Office

Operations Division
Kansai Branch Office
Washington D.C.

Marunouchi Chuo Building, 1-9-1, Marunouchi,
Chiyoda-ku, Tokyo 100-0005, Japan

Shiojiri

Shin-Osaka Hankyu Building 10F, 1-1-1, Miyahara,
Yodogawa-ku, Osaka-shi, Osaka 532-0003, Japan

Takayama Line

900 17th Street, N.W., Suite 520,

OfficeWashington,DC 20006, U.S.A.

London Office

6th Floor, 4 Eastcheap, London, EC3M

Sydney Office

TatsunoChuo Line

Taita Line

Suite 5.01A, Level5, 20 Hunter Street,Tajimi

Kyoto

ChairmanPresident

Shin-Osaka

Corporate Planning Division

Supervision Department

General Technology Division
Chuo Shinkansen Promotion Division

Conventional Lines Operations Division

Audit Department

NagoyaNumazuPlanning Department

Property Management Department

Supervision Department

Marketing Division

Transportation Safety Department
Overseas Oﬃces: Washington D.C., London, Sydney
General Education Center
Nagoya Central Hospital

Shinkansen Operations Division

Transportation and Marketing Department
Rolling Stock Department
Tracks and Structures Department
Electrical Engineering Department
Kansai Branch Oﬃce

Matsusaka

Taketoyo Line Toyohashi

Tokaido Line

Kozu
Atami

Shizuoka

Tokaido Shinkansen

Toba
Sangu LineOperating Kilometers by line
552.6kmConventional Lines
360.1km
Tokaido Line
Gotemba Line

Iida Regional Oﬃce

Finance Department

Obu

TaketoyoTaki

Gotemba Line

Tokaido Shinkansen

Mie Regional Oﬃce

Personnel Department

Construction Department

Kisei Line

Shizuoka Branch Oﬃce

Legal Aﬀairs Department

Business Promotion Division

Ise-Okitsu

Electrical Engineering Department

Administration Department

Audit and Supervisory Board

Rolling Stock Department

Meisho Line

Tracks and Structures Department

Public Relations Department

Audit and Supervisory Board Members

Transportation and Marketing Department

Kameyama

Minobu Line

Fuji

Kansai Line

Secretarial Department

ShinagawaShin-Yokohama

Iida Line

Gifu

Ogaki
MaibaraO rga n iz a tion C ha r t

Tokyo

Kofu

Mino-Akasaka Mino-Ota

Sydney, NSW 2000, Australia

Board of Directors

Shizuoka

JR-CENTRAL

Inotani

5356, Kami-Iida, Iida-shi, Nagano
395-0000,Japan

Shinkansen

Nagoya Tokyo

Shin-Osaka

1AE, U.K.

▶

500km

0

JR Central Taiko Building, Meieki 1-3-4,

Shingu60.2kmMinobu Line

88.4kmIida Line

195.7km

Taketoyo Line

19.3kmTakayama Line

189.2km

Chuo Line

174.8km

Taita Line

17.8kmKansai Line59.9kmKisei Line

180.2km

Meisho Line

43.5kmSangu Line

29.1kmHealth Care Center

Conventional Line Total 1,418.2km

Administration Management Center

Total

1,970.8km

SCMAGLEV and Railway Park

100

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

101

Business Strategy

ESG Activity Report

Special Feature

Financial Information

Corporate Data

Corporate Data

▶Chuo Shinkansen Related Information▶St ock I nformat ion

Route of the Chuo Shinkansen (Between Tokyo and the City of Nagoya)

This map is copied from a Japanese map (with a scale of 1 to 1,000,000) published by the Geographical Survey Institute with their authorization. (Authorization number: H25 Jo Fuku, 310)

Yamanashi Prefecture

Tokyo Metropolis

Nagano Prefecture

Gifu Prefecture

Shifts in JR Central’s Stock Price（Yen）
2,800,000（Yen）
28,0002,600,000

26,0002,400,000

24,0002,200,000

22,0002,000,000

20,0001,800,000

18,0001,600,000

16,0001,400,000

14,0001,200,000

12,0001,000,000

10,000800,000

8,000

600,000

6,000

Kanagawa Prefecture

Legends：Planning Route：Yamanashi Maglev Line
：Station Location N
Shizuoka Prefecture

Aichi Prefecture

Content of Development Plan

Flow of work based on the Nationwide Shinkansen Railway Development Act

Article 4

Basic Plan

Decided in November 1973

Article 5 Research and Reports

Topological and geological surveys Ordered in February 1990
→Reported in October 2008
Research on the residual 4 items* Ordered in December 2008
→Reported in December 2009

Article 14-2 The Transport Policy Council

Article 6 Designation of Operator and Constructor

0

50km

(Note) The estimated amount of expenditures for construction does not include interest.

Construction line

Chuo Shinkansen

SectionTokyo - Osaka City

Technology used for runningSuperconducting magnetic levitation technology

Maximum design speed

505 km/h

Estimated amount of costs
required for construction(including rolling stock costs)

9,030 billion yen

Other necessary items

Main areas
passed throughKofu City area, south-central Akaishi Mountains(Southern Alps), Nagoya City area, Nara City area

Outline of the Construction Implementation Plan (Part2) of the Chuo Shinkansen section between Shinagawa and Nagoya

Consulted on February 24, 2010

Section→Replied on May 12, 2011

Between Shinagawa and Nagoya

Station Location
Line extension

Consented on May 18, 2011
→Designated on May 20, 2011285.6km
4,853.6 billion yen[Total construction costs of 5,523.5 billion yen (Includes rolling stock costs.
Excludes the construction costs for the existing Yamanashi Maglev Line)]

Construction costs

Consented on May 23, 2011

400,000

Shinagawa Station, Kanagawa Prefecture Station (provisional name),
Yamanashi Prefecture Station (provisional name), Nagano Prefecture Station(provisional name), Gifu Prefecture Station (provisional name), Nagoya Station

Expected completion year

Article 7 Development Plan

25

2027

Propulsion System

N S N S N S N S N

By passing current through the Propulsion Coils on the ground, amagnetic ﬁeld (north and south poles) is produced, thus the vehicle
is propelled forward by the attractive force of opposite poles andthe repulsive force of same poles acting between the ground coils
and the Superconducting Magnets built into the vehicles.

Article 8 Instruction to Construct Instructed on May 27, 2011
Environmental
Impact Assessment
Construction Implementation Plan (Part1) : Submission on August 26, 2014

S N S N

Construction Implementation Plan (Part2) : Submission on September 25, 2017
→Approved on March 2, 2018

Start of Construction*Research on the residual 4 items ●Items related to transportation capacity in response to transportation demand●Items related to the development of facility and rolling stock technologies●Items related to construction costs●Other necessary items

M ajor S har ehol der s
Number of shares held

Percentage of total issued shares

12,597,400
9,997,100
8,642,300
7,125,000
6,278,100
5,000,000
4,000,000
3,423,900
3,388,700
3,350,000

6.39%
5.07%
4.39%
3.62%
3.19%
2.54%
2.03%
1.74%
1.72%
1.70%

63,802,500

32.39%The Master Trust Bank of Japan, Ltd. (Trust Account)
Japan Trustee Services Bank, Ltd. (Trust Account)
Mizuho Bank, Ltd.
The Nomura Trust and Banking Co., Ltd. (Holder in Retirement Benefit Trust for MUFJ Bank, Ltd.)N S N SS N S N S N S N S

Levitation System

Article 9 Construction Implementation Plan →Approved on October 17, 2014

Note: On October 1, 2012, the Company implemented a 100-for-1 stock split and employed a share unit system by which one share unit equals 100 shares.
Please refer to the left axis for stock prices before September 2012 and the right axis for stock prices after October 2012.

Name

The Principles of the Superconducting Maglev System→Decided on May 26, 2011

4,000
Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May Jul. Sep. Nov. Jan. Mar. May
2011 2011 2011 2011 2011 2011 2012 2012 2012 2012 2012 2012 2013 2013 2013 2013 2013 2013 2014 2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 2015 2016 2016 2016 2016 2016 2016 2017 2017 2017 2017 2017 2017 2018 2018 2018 2018 2018 2018 2019 2019 2019 2019 2019 2019 2020 2020 2020

MUFJ Bank, Ltd.
Nippon Life Insurance Company
Toyota Motor Corporation

The Levitation and Guidance Coils are installed on both sides of theguideway (track). When the on-board Superconducting Magnets passthrough at high speed, an electric current is induced in the Levitation
and Guidance Coils, causing them to become electromagnets. This
generates a force that both pushes and pulls up the vehicle.

The Dai-ichi Life Insurance Company, Ltd.
N
S

S

N

S
N

Japan Trustee Services Bank, Ltd. (Trust Account 5)
The Norinchukin Bank
Total
Note: In addition to the above, JR Central holds 8,999,249 shares of treasury stock.

［As of March 31, 2020］

Guidance System
The Levitation and Guidance Coils on both sides of the guideway
keep the vehicle in the center of the guideway at all times by exerting
an attractive force on the far side of the vehicle and a repulsive force
on the near side when the vehicle moves oﬀ center to either side.

Overview of the Yamanashi Maglev Line

N

S

N

N

JR Central has been included in the following index for socially responsible investment (SRI).
MSCI Japan ESG Select Leaders Index is an SRI index consisting of

Yamanashi Maglev Line starting point

Initial section start point

0km000m

Initial section end point

16km610m

35km010m

companies with high Environmental, Social, and Governance (ESG)

Yamanashi Maglev Line end point

performance relative to their sector peers, provided by MSCI.

42km800m

ECPI Indices is a socially responsible investment index provided
by ECPI, which investigates ESG (Environmental, Social andElevation
800ｍ

Governance) in a company and provides its rating information.
ECPI's main offices are located in Luxembourg and Italy.

600ｍ

URL： https://english.jr-central.co.jp
Tel：(052)564-2413 ／ Fax：(052)587-1300

E-mail ： ir.msd@jr-central.co.jp

400ｍ
200ｍ
Incline（‰） 18
Kilometers（km）0

102

40

［Extended section］

17

5

40

10

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020

6

15

40

Ini t i a l s ec t i o n ［ f a c i l i t y up g ra d ed ］

20

28

3

25

40

30

［ E x t end ed s ec t i o n］

9

35

3

40

40

For more information, please visit the following:・Safety Reporthttps://company.jr-central.co.jp/company/achievement/report/
・Linear Chuo Shinkansen https://linear-chuo-shinkansen.jr-central.co.jp/
・Fact Sheet
https://company.jr-central.co.jp/ir/factsheets/

CENTRAL JAPAN RAILWAY COMPANY Annual Report 2020103