JR East Group Management Five Vision —Ever Onward—V Group Philosophy

The JR East Group aims to contribute to the growth and prosperity of the Contents East area by providing quality leading-edge services, with train station Group Philosophy and Basic Principles 02 and railway businesses at its core, to customers and communities. 1. Our Starting Points 04 We will continue to embrace the challenge of pursuing “extreme safety levels” and service quality reforms. Through technological innovation and 2. Our Calling 06 globalization, we will strive to attain goals such as nurturing personnel with 3. Ever Onward 10 an expansive perspective, spurring the advancement of railways, and making line-side areas more attractive and convenient. To this end, JR East will 4. Eternal Mission 12 continue to rigorously pursue its unlimited potential. (1) KIWAMERU (Excel): We aim to grow continuously while meeting our social responsibilities as Pursuing “extreme safety levels” —Building a railway capable of withstanding natural disasters a Trusted Life-Style Service Creating Group. (2) MIGAKU (Improve): Service quality reforms—Enhancing rail transportation network and other measures

(3) TOMO NI IKIRU (Together): Strengthening collaboration with local communities Basic Principles —Supporting earthquake recovery, stimulating tourism and revitalizing communities 5. Pursuing Unlimited Potential 22 1 Together with customers and communities (1) HIRAKU (Pioneer): Technological innovation—Forging strategies for conserving energy and the We will put our hearts into providing good service and living up to environment, utilizing ICT (information and communication technology) and customers’ and communities’ expectations. operating at faster speeds

(2) NOBIRU (Grow): 2 Tackling new business areas—Globalization Enhancing safety and quality We will aim to enhance safe and reliable (3) HABATAKU (Empower): transportation services and service quality. Developing employees and creating a corporate culture that maximizes human potential 6. Numerical Targets 28

3 7. Conclusion 30 Pursuing unlimited potential General principles of Safety 31 With an expansive perspective and based on our calling, we will pursue the JR East Group’s unlimited potential.

Notes: Fiscal years end on March 31 of the respective years shown. The graphic images and illustrations in this document represent the Company’s future direction. 1. Our Starting Points

First Starting Point Our operating environment has changed dramatically as a result of the Great East Japan Earthquake. There is still much JR East was established as a result of the reform and privati- more work that must be done to fully recover from the earth- zation of Japanese National Railways (JNR) 25 years ago. quake. Moreover, the earthquake has brought into sharp Considerable time has passed since then. In fact, almost all of relief certain issues that Japan faced even before the earth- our new employees were born after the reform. Nonetheless, quake, such as an aging and declining population, the hol- the reform of JNR, with the following goals, will always remain lowing-out of industry, and the dwindling strength of regional our first starting point. economies. These issues are becoming increasingly serious ◆ Thinking and acting for ourselves, upholding management challenges. Japan must also tackle new issues, such as the autonomy accident at Daiichi Nuclear Power Station and per- ◆ Achieving regionally rooted management sistent power shortage problems. ◆ Aiming to be a company capable of responding appropriately, flexibly, and promptly to changing times and conditions Having positioned March 11, 2011 as our second starting point, we must once again ask ourselves what role we must To avoid repeating the shortfalls and failure of JNR, we will play, and how we should direct our evolution as an enterprise hold the goals of the reform close to heart. While constantly providing social infrastructure in the form of railways. remaining mindful of the support we have received from stakeholders, including customers and communities, we will New Management Vision Formulated make the continued pursuit of those goals the basis of our corporate management. From this perspective, we have formulated our fifth medium- term management plan, “JR East Group Management Vision Second Starting Point V(Five)—Ever Onward.” The plan was formulated based on “Key Challenges Over the Next Three Years (FY2013 (Year end­ On March 11, 2011, some 24 years after the company was ing March 31, 2013) through FY2015 (Year ending March31, formed, the Great East Japan Earthquake struck. JR East was 2015)),” which was announced in April 2012. In anticipation forced to suspend operations on many routes, including of changes in the social environment through around 2020, Shinkansen, over an extended period. Various facilities were we have drawn up a plan that sets forth management’s basic damaged, along with a large drop in railway ridership. Above direction and what specific priorities we will execute. all, the Great East Japan Earthquake caused untold devasta- A poster “TOHOKU MY LOVE”, released around the first anniversary of the Great East tion in many communities where we conduct business. All JR East Group employees worked together to overcome the Japan Earthquake. difficulties caused by the earthquake, giving JR East a sense of Show JR East’s message: We will consider the Under these conditions, we have been able to surmount these future of communities together with local confidence and pride. Keeping this confidence and pride close communities and take action accordingly. difficulties thanks to the considerable support of all related to heart, the JR East Group will continue to boldly tackle vari- parties. Through experience derived from the Great East Japan ous challenges as we make a fresh start to revitalize the East Earthquake, we have reaffirmed our mission as a railway oper- Japan area, our home ground, along with Japan as a whole. ator and have learned the following valuable lessons. ◆ The significance and responsibility of our mission ◆ High expectations for the JR East Group from customers and communities ◆ The abilities every individual employee demonstrated in the recovery and restoration effort following the Great East Japan Earthquake ◆ The importance of steadfast daily activities and training drills

A poster released when the operation of Tohoku Shinkansen resumed. Show JR East’s message: We will support A letter of encouragement from a young railway fan reconstruction of Tohoku regions by in Sendai City when train operations were connecting areas with our trains. suspended due to the Great East Japan Earthquake.

04 JR East Group Management Vision V JR East Group Management Vision V 05 2.Our Calling

The JR East Group’s New Key Phrase The Great East Japan Earthquake poignantly reminded us of the fact that com- panies cannot thrive without sound and vibrant communities. The East Japan area, our home ground, and Japan as a whole currently face a host of issues. As a corporate citizen, we are determined to fulfill our mission and execute busi- nesses unique to the JR East Group in an effort to help solve those issues. The goal is to draw a blueprint for the future together with members of the com- munity as we do our part to build vibrant communities. This is what we mean by “thriving with communities.”

Thriving with Communities, However, taking root in communities does not mean becoming complacent by turning inward. To continue to fulfill our mission, we must constantly transform Growing Globally ourselves and achieve growth. We must look outward and step out into the world, while actively seeking knowledge and technology externally. We believe that doing so will provide fertile ground for capturing new growth opportuni- ties. To unlock our full potential, we must boldly step out into the world. That is what we mean by “growing globally.”

Accordingly, we have adopted “Thriving with Communities, Growing Globally” as the JR East Group’s new key phrase, in order to develop a shared understanding among all Group employees and achieve cohesive Group-wide management.

06 JR East Group Management Vision V JR East Group Management Vision V 07 2. Our Calling

Two important pillars and Six basic courses of action for the Group Eternal Mission and Pursuing Unlimited Potential

[Eternal Mission] [Pursuing Unlimited Potential] Even amid the major upheaval following the Great East Japan Earthquake, The JR East Group must achieve sustained growth in order to continue to the fundamental mission of JR East will never change. However, the con- fulfill its three-part eternal mission in the years ahead. In a fast-changing tent and quality of services that customers and communities expect of the environment, maintaining the status quo will only mean falling behind. JR East Group will change in step with shifting social conditions. Our mis- Unless we constantly take on the challenge of reaching new goals, we will sion is to provide safe and high-quality services that customers expect of be unable to achieve growth. The JR East Group and every Group employee the JR East Group and conduct railway and life-style businesses, with the Thriving with have the unlimited potential needed to achieve further growth. We have aim of contributing to the growth and prosperity of communities. We have Communities, technologies underpinning business operations such as railways, markets once again positioned this mission as a key tenet of management. At the Growing Globally for our business activities, and people supporting these two elements. same time, we will make relentless efforts to ensure that the content and From these three perspectives, we will pursue the JR East Group’s unlim- quality of our services properly answer the expectations of society. ited potential.

(1) Pursuing “extreme safety levels”—Building a railway capa- (1) Technological innovation—Forging strategies for conserv- ble of withstanding natural disasters ing energy and the environment, utilizing ICT (information and communication technology) and operating Shinkansen (2) Service quality reforms—Enhancing rail transportation at faster speeds network and other measures (2) Tackling new business areas—Globalization (3) Strengthening collaboration with local communities —Supporting earthquake recovery, stimulating tourism (3) Developing employees and creating a corporate culture and revitalizing communities Strengthening that maximizes human potential collaboration with local communities

Service quality reforms

Technological innovation Eternal Mission

Pursuing “extreme safety levels” Pursuing Unlimited Potential Tackling new business areas

Developing employees and creating a corporate culture that maximizes human potential

08 JR East Group Management Vision V JR East Group Management Vision V 09 3.Ever Onward

The JR East Group possesses a railway network stretching over 7,500 km, with about 1,700 stations, retail stores and restaurants in the life-style business, and line-side areas with various attractive features. In addition, we safely and reliably operate trains every day, and possess business resources—specifically technolo- gies, knowledge and experience—needed to provide customers who come and go through this network with various life-style services. Furthermore, pre- Expand paid, rechargeable IC cards, which were launched in 2001, have grown to the new business domains point where they are used in various life-style scenes and settings, not just for railway service. Today, Suica is an integral part of social infrastructure essential to (avenue for employees daily life. All of these assets have immense potential to contribute to the JR East to succeed) Group’s growth in the future.

Above all, the JR East Group’s greatest asset is every employee underpinning its business operations, and we believe every employee still has considerable poten- tial to expand his or her abilities. Since JR East was formed, we have faced various challenges, including natural disasters such as the Great East Japan Earthquake and a decline in operating revenues due to economic downturns. The true strength demonstrated by all Group employees in these trying circumstances is EverEver OnwardOnward the key to unlocking the full potential of our business resources. To this end, we must provide new avenues for employees to succeed, such as through techno- logical innovation and globalization, in addition to existing businesses. We intend Growth of to develop the abilities of our highly motivated employees as we actively create Growth of opportunities for them to thrive. every and each the Group We will drive the Group’s growth by having every employee achieve personal employee growth through their work. This will further expand avenues for employees to succeed, providing them with even more opportunities to grow. By combining the personal growth of every employee with the Group’s growth, we will achieve positive cycles of growth. This is what we mean by “Ever Onward.”

Positioning the Great East Japan Earthquake as our second starting point, the JR East Group and each employee will be guided by our calling, which set a course for management, as we embark on a new journey to advance ever onward.

10 JR East Group Management Vision V JR East Group Management Vision V 11 4.Eternal Mission (1) Excel Pursuing “extreme safety levels” KIWAMERU —Building a railway capable of withstanding natural disasters When the Great East Japan Earthquake occurred, the 1 Responding to major earthquakes (Addressing remaining risks) earthquake countermeasures steadily implemented by Considering the status of damage projections and disaster JR East until then proved effective to a great extent. a) Promotion of seismic reinforcement and preparedness plans of national and local governments, we will However, the earthquake also revealed issues that we other countermeasures for the earthquake strive to monitor any additional remaining risks while actively must address to ensure a higher level of safety. Based taking steps to mitigate those risks. (Seismic reinforcement and other countermeasures at on this experience, we have worked to implement earth- a total cost of approximately ¥300 billion) quake countermeasures in preparation for events that b) Rescuing customers and saving lives in We will now promote seismic reinforcement and other coun- are conceivable such as an earthquake directly beneath the event of a disaster termeasures against a possible earthquake directly beneath the metropolitan area, focusing on both tangible the Tokyo metropolitan area, as well as the possible Tokai (Responses in the event of an earthquake) and intangible aspects. In these ways, we are working to Earthquake and other major earthquakes in Japan at a total We will install necessary equipment and provide training to build a railway capable of withstanding natural disasters. 3 Automatic platform gates cost of approximately ¥300 billion, positioning the next five- employees, to ensure that rescuing customers and saving lives We are also further promoting initiatives to prevent year period (from FY2013 to FY2017) as an intensive implemen- are our top priority in the event of an earthquake. In addition, We will accelerate the installation of automatic platform gates train collision, derailment accidents and rail crossing tation period. Through these countermeasures, we will endeavor we will take steps to assist people who have difficulty return- for the as a safety measure for station plat- accidents. At the same time, we are taking steps to to build a railway capable of withstanding natural disasters. ing home, such as by securing temporary shelter within train forms. By FY2016, automatic platform gates will steadily enter install automatic platform gates for the Yamanote Line stations and stockpiling supplies. service at 23 stations, excluding stations where major renova- • To prepare for a possible earthquake directly beneath the and exploring the possibility of installation for other tions are scheduled. For routes other than the Yamanote Line, Tokyo metropolitan area, we will conduct seismic reinforce- (Guiding tsunami evacuations) lines. In these and other ways, we continue to promote we plan to install automatic platform gates mainly at stations ment of embankments, cutouts, brick arch viaducts, electri- We will enhance employees’ ability to respond to tsunamis the development of railways that passenger can utilize used frequently by visually challenged customers, while dis- cal poles and other infrastructure. In addition, we will through regular training and drills using a Tsunami Response reliability. We will also bolster activities aimed at achiev- cussing these matters with the relevant organizations. implement station/platform ceiling and wall collapse pre- Manual (our manual for employees in the event tsunamis are ing “extreme safety levels.” For example, we will steadily vention countermeasures, among other initiatives. We will anticipated), which stipulates such matters as areas in danger make progress on initiatives based on 2013 Safety Vision, 4 Promoting measures to prevent train also accelerate measures such as seismic reinforcement of of tsunami, and operating restrictions and methods when while formulating our next medium-term safety plan. collision and derailment accidents viaduct columns, which we had been implementing on an tsunamis are anticipated. Having understood the manual, Pursuit of safety measures can never end. We will con- ongoing basis. employees will autonomously make decisions and take action Our goal is to eradicate preventable accidents by further tinue to tirelessly work to improve safety by pursuing a in response to situations that cannot be addressed solely by upgrading railway operation and maintenance systems. As • Based on experience derived from the Great East Japan goal of “zero accidents involving passenger injuries or the manual. Their actions and decisions will be based on the part of measures to prevent train collision and derailment Earthquake, we will proceed with the seismic reinforce- fatalities and zero accidents involving employee fatali- Tsunami Evacuation Principles, which we established follow- accidents, we will continue to install ATS-P and ATS-Ps (auto- ment of train station buildings serving more than 3,000 pas- ties (including employees of Group companies and part- ing the Great East Japan Earthquake. matic train-stop systems), along with taking steps to prevent sengers per day, along with the seismic reinforcement of ner companies).” rail crossing accidents. Shinkansen electrical poles, particularly in the Sendai area. 2 Responses to natural disasters and Also, in order to minimize human error, we will simplify both extreme weather events • We will work to enhance emergency communications func- the tangible and intangible aspects of our operations. Examples tions in the event of an earthquake. Countermeasures We will continue to make the necessary capital expenditures include refining the number of various handling rules and stan- include increasing the communications speed for seismom- to address natural disasters and extreme weather events, dardizing the specification of equipment and devices. eter measurement data, and upgrading backup power sup- such as torrential rain, wind gusts and lightning, which have plies for the communications network. been increasing recently. Measures will include capital expen- 5 Upgrading systems and structures to ditures to upgrade facilities in vulnerable sites. Also, we will ensure safety upgrade our observation system and develop new technolo- We will enhance the ability of every employee responsible for gies, with the aim of achieving even higher levels of safety. safety and the organization as a whole by having employees discuss frank opinions regarding hidden causes of potential accidents and safety vulnerabilities. At the same time, we will learn from past accidents and the examples of other compa- nies. In addition, we will continue to constantly pursue the optimal safety management system for the Group as a whole, while continuously implementing training and drills designed to increase and maintain an awareness of safety.

12 JR East Group Management Vision V JR East Group Management Vision V 13 4.Eternal Mission (2) Improve Service quality reforms MIGAKU —Enhancing rail transportation network and other measures To become a corporate group respected by customers 1 Improving transportation quality 2 Pursuing customer-friendly railway services 3 Improving the quality of the Tokyo and communities, we will implement service quality metropolitan area railway network (Preventing disruptions to service) (Enhancing service management by each line-side area) reforms by harnessing teamwork extending beyond We will continue working to enhance the reliability of railcars We will enhance the service quality of JR East by reflecting (Improving transportation services) our business divisions and other groups within our and equipment in order to reduce the number of service dis- customer feedback obtained through various channels in In the Tokyo metropolitan area, we will work to improve organization. Our goal is to become No.1 in customer ruptions. One particular goal is to reduce the number of ser- service improvements. Specific measures include monitor- transportation services on each railway line. Specifically, con- satisfaction in the railway industry. We will achieve this vice disruptions caused by railcar and equipment malfunctions based surveys of line-side areas, which are designed to gauge sidering demographic changes in each line-side area, we will goal by rigorously pursuing customer-friendly railway attributable to JR East within a 100 km radius of Tokyo to untapped needs of customers and increase interactive commu- improve services by shifting emphasis from ramping up trans- services. We will hone the quality of transportation ser- one-third the current level. Efforts will also be made to pre- nication with customers. Through these measures, we will portation capacity during peak hours to improving conve- vices by enhancing reliability and comfort, as we pro- vent service disruptions by promoting measures such as natu- enhance service management by line-side area, considering the nience during daytime hours and enhancing seating and mote the development of railways that customers can ral disaster countermeasures. Furthermore, we see improving needs and characteristics of each line-side area in terms of rail- direct service with other railway lines. Through these and utilize without anxiety. the technical skills of employees responsible for railcar and way operation, the provision of information and other aspects. other measures, we will create attractive railway lines that Furthermore, we will generate new sources of demand, equipment maintenance as a key priority. Accordingly, we will “make people want to live alongside JR East railway lines” (Building a reliable and comfortable railway) such as tourism, by steadily promoting several major continue to conduct intensive training and drills involving We will boost the level of customer service provided by all • North-South Corridor——The Tohoku Through Line will projects. These include the forthcoming launch of ser- such employees. JR East Group employees to ensure that customers can utilize enter service in FY2015. As a result, passengers will be able vice on the Tohoku Through Line, as well as new opera- (Quickly resume operations and stop the impact of ser- railways reliably and comfortably. We will also improve the to take the Joban, and Takasaki lines to Tokyo tions of the to Kanazawa and vice disruptions from spreading further) tangible and intangible aspects of services so that seniors and Station, and areas served by the Tokaido Line. In conjunc- the Shinkansen to Shin- (provisional In the event of a service disruption, it is crucial to quickly customers unaccustomed to railways can also use our services tion, we will conduct renovation work on various related name). Meanwhile, we will begin exploring various new resume operations, stop the impact of service disruptions from without anxiety. Moreover, we will rigorously enforce mea- stations, such as Tokyo, Shimbashi and Nippori stations, in options for enhancing the next generation of transpor- spreading further, and restore normal operating schedules. sures to prevent customers from sustaining injuries when an effort to improve convenience. tation services in urban areas. From this perspective, we will develop new systems and oper- using trains, along with anti-crime measures. • East-West Corridor——We aim to steadily improve services Moreover, the productive population of the East Japan ating frameworks that help us to achieve these priorities, in (Enhancing convenience when purchasing products on routes such as the Chuo Line, where there are strong area has started to decline. By 2020, the elderly are an effort to enhance our responsiveness to service disruptions. using ICT) needs for rapid service and seating upgrades. expected to account for about 30% of the population (Providing passengers with more information) We seek to create an environment where customers can easily in this area. This will have a large impact on JR East • “Tokyo Megaloop,” an outer loop around Tokyo formed by To upgrade the information provided to customers during compare and consider purchasing a variety of products, as well business operations, especially its railway operations. the Musashino, Keiyo, Nambu and Yokohama lines——We service disruptions, we will strive to install more train station as speedily book seats on trains from home or on the go. To this However, seeing this challenge as an opportunity, we will implement measures such as expanding direct service displays designed to provide information in times of service end, we will enhance the convenience of the Internet-based will strive to create new demand by taking a range of among our railway lines, and improving convenience during disruptions, along with displays in railcars, while upgrading seating reservation system Eki-net and introduce dynamic pack- initiatives designed to make railway travel even more the daytime hours. the content provided by these displays. In addition, we will aging* of travel products. Through these measures, we aim to accessible to elderly customers, and by offering them a introduce a system that provides information about alternative raise the ratio of customers purchasing tickets and packaged • We will further promote preparations for starting direct ser- variety of services. These initiatives will be designed to transportation and the position of following trains, as a means travel products on their own using the Internet and various vice with Sagami Railway. enable the elderly to enjoy vibrant lives and travel. to provide each customer with the information they need. devices to about 70% by FY2021. (Establishing new stations from a strategic perspective) In Suica operations, we will work to develop services * A travel product that can be structured independently by customers over the Internet by freely combining various package elements, such as trains and accom- We will seek to explore the commercial feasibility of establish- and expand the number of partners accepting Suica elec- modations, according to price. ing new stations from many strategic angles, and to bring tronic money, among other measures, which will enable such plans to fruition in cooperation with local governments. people to enjoy the benefits of Suica as an essential The goal is to increase poin