Odakyu Electric Railway Co.,Ltd.

Part of the Group's business area is included in areas designated for the promotion of earthquake disaster prevention measures related to the Nankai Trough and areas designated for special strengthening of tsunami evacuation measures. In the event of a large-scale earthquake, in addition to direct damage such as human casualties and damage to buildings and equipment, indirect damage may occur, including restrictions on operations due to power shortages and reduced revenue due to a cooling of consumer sentiment. As countermeasures, the Group has established a BCP, is promoting seismic reinforcement works, conducts emergency response drills in cooperation with government agencies, and maintains disaster stockpiles at all stations and related facilities.

In the event of a large-scale natural disaster such as torrential rain or storms, in addition to human casualties, damage to buildings and equipment, and increased restoration costs, reduced revenue due to operational restrictions such as train suspensions and a cooling of consumer sentiment may affect business performance and financial condition. As countermeasures, the Group thoroughly implements alert systems and operational restrictions based on disaster prevention plans, carries out protective works on various structures, installs rain gauges and anemometers, and monitors hazardous locations using fixed-point observation cameras.

Since the Group operates services used by large numbers of customers, such as railways, buses, and commercial facilities, a large-scale outbreak of an infectious disease such as a new strain of influenza could disrupt business operations, including train operations, due to a decline in facility users and widespread infection among employees, thereby affecting business performance and financial condition. As countermeasures, the Group has established a BCP, stockpiles masks and alcohol disinfectant, and has built a system for gathering information.

If a major accident or fire occurs due to human error, equipment malfunction, terrorism, or other illegal acts, in addition to human casualties and business interruption, damages to victims and facility restoration costs may arise, and this may affect business performance and financial condition through a decline in customer trust and social reputation. As countermeasures, the Group has established a BCP, shares risk case information, carries out planned equipment renewal and inspections, and enhances various training and education programs to prevent similar incidents and strengthen response capabilities.

If defects or flaws are discovered in owned assets, or if impacts on health or the surrounding environment are pointed out, costs may arise for improvement, restoration, or compensation. Similarly, if defects or flaws are found in products sold, this may affect business performance and financial condition through the occurrence of improvement or compensation costs and a decline in credibility. As countermeasures, the Group conducts various legally mandated inspections of structures, hygiene, labeling, and bacterial testing of products, and audits by external organizations.

The Group's businesses are highly dependent on computer systems and communication networks. If a serious failure occurs due to sabotage by third parties such as computer viruses, natural disasters, or human error, this may affect business performance and financial condition. As countermeasures, the Group has established the "Basic Policy on Information Security in Information Systems," and implements measures to improve resistance to network failures, installs firewalls, and shares the latest threat information.

If acts that violate laws and regulations, internal rules, or social norms occur and undermine social trust, this may affect business performance and financial condition through sanctions based on laws and regulations or social sanctions. As countermeasures, the Group conducts compliance surveys and formulates activity plans, maintains a compliance hotline, enhances various training programs and seminars, and promotes concrete implementation based on the "Human Rights Policy" and "Sustainable Supply Chain Policy."

The Group holds confidential information, including personal information such as customer data, across various businesses including the credit card business. If information leakage occurs for any reason, this may affect business performance and financial condition through damages and a decline in credibility. As countermeasures, the Group has established a BCP, developed regulations and manuals related to information handling, implemented security measures, and provides regular training and support for obtaining qualifications.

The Group's businesses are largely labor-intensive, making it important to secure and develop high-quality human resources. If this cannot be achieved, business expansion may be constrained, affecting business performance and financial condition. As countermeasures, the Group has enhanced its recruitment website, promotes mid-career hiring and diverse recruitment methods, ensures compliance with Article 36 agreements, improves working conditions and benefits, and improves operational efficiency through systemization and review of business processes.

The Group makes continuous capital investments, primarily in the railway business, and raises funds through borrowings and corporate bonds. Therefore, fluctuations in interest rates and changes in credit ratings may affect business performance and financial condition. As a countermeasure, the Group strives to keep the proportion of long-term, fixed-rate interest-bearing debt high, so that interest payments do not increase sharply even if interest rates fluctuate significantly.