Hankyu Hanshin Holdings

Hankyu Hanshin has set a target to reduce emissions by 40% by 2031 compared to 2014. In 2021, the company reported a 42% reduction in emissions compared to 2014. However, the company does not disclose enough emissions data to assess this reduction. It is unclear if the emissions reduction is in part attributed to carbon offsets. The company should disclose the proportion of each target that has been met through direct climate mitigation action, rather than including offsets. The company is currently reviewing its targets with the aim of setting a net zero by 2050 target.

Although Hankyu Hanshin has implemented board-level oversight of climate change, there is no evidence that its board has climate expertise. It does not incentivise low-carbon performance through executive compensation. The company can improve the likelihood of a successful low-carbon transition by including environmental targets in its salary incentives. The company has completed Task Force on Climate-Related Financial Disclosures analysis to identify risks and opportunities, but this does not include climate scenario analysis. Hankyu Hanshin has not committed to phasing out fossil fuels and plans to utilise carbon offsets.

Hankyu Hanshin works with suppliers to develop more energy-efficient rolling stock. It has introduced highly efficient variable-voltage/variable-frequency (VVVF) inverter control devices and motors in its rolling stock that has reduced electricity consumption by about 50% when compared to conventional rolling stock. Hanshin Electric Railway has upgraded its rolling stock which has led to a reduction of 60% of electricity consumption. Despite this, it has no clear strategy or major initiatives to drive emissions reduction in its supply chain.

Hankyu Hanshin Holdings has set a near-term target to reduce energy consumption in its railway operations by 40% by 2031, compared to 2014. The company has plans to adjust targets to align with the Japanese government’s goal to reach net-zero emissions by 2050 but these targets have not been set.

The company acknowledges the need to update rolling stock to increase energy efficiency but no clear plan has been set. It plans to utilise offsets to achieve its carbon reduction goals. The company’s transition plan does not have any financial content.

Hankyu Hanshin does not disclose what proportion of its research and development expenditure was dedicated to low-carbon technologies. The company uses solar panels and LED lights in stations. Hanshin Electric Railway accounts for approximately 25% of the total lines operated by Hankyu Hanshin. It is unclear what proportion of the Hankyu Corporation lines rely on fossil fuels.

The company has made the Hanshin Electric Railway rolling stock more energy efficient by updating the VVVF inverter controls and replacing all lights with LED lights. The company promotes the benefits of rail compared to private cars but does not have a clear strategy for influencing customers to reduce their GHG emissions.

Hankyu Hanshin has set emission targets and promotes the achievement of emissions reductions in its operations but the company does not disclose emissions data. It is unclear what percentage of previous emissions reductions are achieved through offsets.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.

No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue or engagement with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks.

The company discloses the actions it takes to provide training opportunities for workers and affected stakeholders. For instance, it offers business training programmes for employees as well as internships for students, with a total of 535 student participants in 2021. However, no relevant disclosure was found of the company embedding equality of opportunity for women and vulnerable groups in these actions. Furthermore, no evidence was found of the company having a process for identifying skills gaps for workers and affected stakeholders or a public commitment to help workers displaced by the transition to reskill or upskill.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.

No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

No evidence within policy documents was found of a company commitment to respect human rights and the ILO fundamental rights at work. Furthermore, no evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and supply chain. While the company has a grievance mechanism available to workers, no evidence was found of a grievance mechanism available to external stakeholders.

While the company discloses a target of increasing the share of women in management positions to 10% by 2031, no evidence was found of a company commitment to gender equality and women’s empowerment in the broad sense. Furthermore, no evidence within policy documents was found of a company commitment to respecting worker health and safety. The company discloses the gender of its workforce by employee category, but it can increase disclosure on other indicators of workforce diversity, as well as on its living wage, working hours and collective bargaining practices.

While the company has a policy prohibiting bribery and corruption, no relevant disclosure was found of corresponding clauses in its contracts with business relationships. Furthermore, no evidence was found of a company commitment to protect personal data of employees and customers, or of a privacy statement regarding the collection, sharing and access to personal data. Moreover, no evidence within policy documents was found regarding the company’s tax strategy or its lobbying and political engagement approach.