Rinnai Corporation
http://www.rinnai.co.jp/

Corporate Social Responsibility

CSR
Report2014

Printed in Japan
using “waterless”
printing, reducing
water usage andeliminating industrial
wastewater

2014.10

Contents
1

CSR Report 2014

3

Top Message
Message from the Chairman
Message from the President

6

Rinnai Group8

Corporate Mission and Vision

11

Vision and Medium-Term Business Plan

14

Rinnai Group CSR

17

Identifying CSR Matrial Issues

20Communication With Our Stakeholders

23

Management System

29

Major Award Winning History

30

Environmental Initiatives

37

Environmental Management System

42

Environmental Action Plan and Results

46

Developing Environmentally Conscious Products

53

Environmentally Conscious Monozukuri

65

Environmental Accounting

67

Envrionmenta Education and Promotion of Awareness71

Chronology of Environmental Activities at Rinnai

73

Initiatives Delivering Safety and Peace of Mind

76

With Our Customers

88

With Our Employees

104With Our Shareholders and Investors

107

With Our Business Partners

111

With Our Communities and Society

Supplemental Data:
1. Oguchi Factory

7.

Rinnai Precision Co., Ltd.

2. Seto Factory

8.

RT Engineering Co., Ltd.

3. Asahi Factory

9. Japan Ceramics Co., Ltd.

4. Yanagisawa Manufacturing Co., Ltd.

10. Noto Tech Co., Ltd.

5. Rinnai Technica Co., Ltd.

11. Techno Parts Co., Ltd.

6. RB Controls Co., Ltd.

CSR Report 2014┃CSR report

CSR Report 2014
Editorial Policy
Rinnai puts out a CSR Report to convey to stakeholders management’s approach to CSR, to describe the activities
undertaken groupwide, and to encourage a deeper understanding of the Group’s operations to as many people aspossible.

Rinnai’s Activities
To provide an overview of our CSR activities in an easy-to-understand way, we produce an abridged version of our
CSR Report in booklet form. Information not contained in the booklet—such as case studies, specific details, andrelated data— is posted on the website at the address below.
http://www.rinnai.co.jp/en/corp/csr/report/index.html

Scope
Rinnai Group(Rinnai Corporation and companies under the Rinnai Group umbrella in Japan and overseas)

Reporting Period
This report focuses on events that occurred in _scal 2014—April 1, 2013, to March 31, 2014—but also touches
upon measures implemented and recent activities undertaken prior to _scal 2014 as well as future businessdirection, targets and plans.

Referenced Guidelines
Sustainability Reporting Guidelines (G4), the fourth and most recent generation of guidelines by the Global
Reporting Initiative (GRI)
ISO 26000:2010
Environmental Reporting Guidelines (fiscal 2012), issued by Japan’s Ministry of the Environment
Environmental Accounting Guidelines (fiscal 2005), issued by Japan’s Ministry of the Environment

1

CSR Report 2014┃CSR report

Publication Schedule
October 2014 (Japanese version), previous: October 2013, next: August 2015 (planned)

Contact
For information on the Rinnai Group’s social and environmental activities, please contact the Corporate
Communication Office at Administration Headquarters
2-26, Fukuzumi-cho, Nakagawa-ku, Nagoya, Aichi 454-0802, Japan
Telephone (from outside Japan): +81-52-361-8211
Fax (from outside Japan): +81-52-361-8529

2

CSR Report 2014│Top Message

Top Message
Message from the Chairman
Under the motto of “harmony, spirit, and sincerity,” Rinnai’s Corporate Mission is to“utilize heat to provide society with comfortable lifestyles.” This has guided ouractivities since our foundation in 1920, when we began making and selling petroleum
stoves. Today, Rinnai is a comprehensive manufacturer of heat-energy applianceswith operations in 16 nations worldwide, as well as Japan. Our Corporate Mission has
remained unchanged throughout our history, and will continue into the future.
We have always maintained a strong commitment to quality. With toppriority on the tenet that “Quality is our destiny,” we focus on the pursuit of safe,
high-quality products. At Rinnai, “quality” is not limited to product manufacturing,but covers all aspects of our operations, including distribution, customer relations, andafter-sales service.
Overseas, where customs and cultures differ from Japan, we offer productsthat are matched to local needs. This reflects our commitment to maintaining the levelof quality that our customers demand at home. Accordingly, we endeavor in principle
to appoint people from local countries and communities to top positions in ouroverseas group companies, so that we can better grasp and reflect the sentiment ofconsumers local to our business there.
Over the past few years, addressing global environmental problems has become anurgent international challenge. As a comprehensive manufacturer of heat-energy
appliances, the Rinnai Group is strongly aware of the huge role it must play. In thecontext of Japan’s low-birthrate, aging society, as well, we recognize that we are
expected to propose safer and more comfortable lifestyles. Going forward, we will
target ongoing improvements in safety and peace of mind, comfort, and environmental
performance in order to benefit society.

Susumu Naito,
Chairman3

CSR Report 2014│Top Message

Message from the President
As a comprehensive manufacturer of heat-energy appliances, we are constantly contemplating
what we can do in order to realize a safe, secure, healthy, and environmentally friendly society.
Providing high added value that benefits communities in Japan and othernations/regions worldwide
In the fiscal year ended March 31, 2014, the Rinnai Group posted a 14.0%
year-on-year increase in consolidated net sales, to ¥286.9 billion, and a 29.1%
jump in operating income, to ¥34.0 billion. These results were due to healthy
sales in Japan and solid and improved sales overseas. In Japan, there was arush in demand in the residential construction and renovation sector ahead of
the consumption tax hike. This, together with a weak yen and other factors,
had a short-term impact on our performance. Due to expectations thatgovernment stimulation measures would have an upward effect on theeconomy, however, consumption turned upward. Also contributing to ourhealthy results, we believe, was acknowledgment of our ability to deliver
high-value-added products to the world—reflecting our role as acomprehensive manufacturer of heat-energy appliances that conducts its
operations based on the themes of “heat and lifestyles.”Rinnai contributes to society simply by expanding and promoting its
lineup of such high-value-added products. In the domestic market for water
heaters, for example, we are targeting proliferation of our high-efficiency Eco
Jozu offerings. At present, water heaters can be broadly classified into three
types: models that heat water only, models that heat water and also have a
Hiroyasu Naito, President
bath-filling function, and water heaters with systems that also heat rooms
using hot-water-based floor heating and other systems. (Eco Jozu systems
account for around 80% of Rinnai’s sales of water heaters with heating
systems.) Another key product is our ECO ONE hybrid water heater withheating system, which combines a gas water heater with a heat pump. At
present, ECO ONE boasts the lowest primary energy consumption amongwater heaters in Japan. This exceptional energy efficiency was recognizedwhen Rinnai received the METI Award, which is the top prize in the Fiscal
2013 Energy Conservation Awards.
Proliferation of these high-efficiency water heaters not only promotes energy savings but also helps
suppress emissions of carbon dioxide, which is a source of global warming. The industrial sector has made good
progress in reducing carbon dioxide emissions, and to achieve further reductions we must turn our attention toemissions from households. We believe that our Eco Jozu and ECO ONE offerings will help realize such
reductions.
In other new initiatives, Rinnai is promoting its Smart House concept, which envisages the ideal image of
future living—with some elements currently under practical application—as well as home energy management
systems (HEMS).
We are also promoting high-value-added products overseas. In January 2014, for example, it became
mandatory in South Korea for all burners on gas stoves to have temperature sensors attached. Using technologies
amassed in Japan, Rinnai launched models that meet the new requirements. In the United States, meanwhile, many
people are shifting from tank-based (storage type) water heaters to tankless (instant heating) systems, which are
mainstream in Japan. To address consumer inconvenience during the changeover (no access to hot water), Rinnai is
promoting a system that combines both tank-based and tankless units and requires minimal installation time. In
these and other ways, we are offering high-value-added solutions matched to the specific needs of nations andregions.
Rinnai uses its core business to promote various CSR activities. One initiative going forward is the “barrier
free temperature” concept (eliminating temperature differences). We are focusing particular attention on addressing
the “heat shock” phenomenon, which occurs when the body is subject to sudden changes in temperature, such as
when entering a bath. For this reason, we are working to raise awareness and foster the proliferation of bathroom
heater/dryers, which can be very effective in preventing heat shock.

4

CSR Report 2014│Top Message

The current fiscal year, ending March 2015, is the final year of our medium-term business plan, entitledJump Up 2014 (see page 9 for more details). Throughout the year, we will seek to contribute to people’s lives andthe global environment as a comprehensive manufacturer of heat-energy appliances. We aim to make a social
contribution by implementing the plan and achieving its objectives.
Defective dishwashers and bathroom-installed fan-forced gas water heaters
At Rinnai, where “Quality is our destiny,” we place top priority on customer safety. In 2012, a defect was
uncovered in some of our dishwasher models, and in 2014 a defect was found in some bathroom-installed fanforced gas water heaters made by Gastar Co., Ltd. and sold by Rinnai Corporation. These events caused a major
inconvenience to customers, for which we sincerely apologize.
At present, our response teams are undertaking inspection, repair, and parts replacement of the defectivemodels. We have already discovered the causes of the problems and are working to prevent recurrences. We willcontinue devoting our utmost efforts until the last machine in fixed.
Creating comfortable workplaces for women
Rinnai is working hard to enhance its management and working environments. In June 2014, for example, we
improved corporate governance by welcoming an outside person into our Board of Directors. We also engage inactivities to advance female employees as part of our diversity program. In addition to maternity and childcare
leave, we offer shortened workweeks, flexible working hours, and work-at-home arrangements. In these and otherways, Rinnai endeavors to create motivating workplaces tailored to employees’ lifestyles.
For older employees, we offer a variety of working arrangements, depending on the needs of theindividual. In addition to re-employing those who have reached retirement age but wish to continue working, theseinclude offers of part-time and casual work. We also strive to employ disabled people, but regrettably we are notmaking much progress in this area. We will work hard to address the situation, which we recognize as an importantpriority going forward.
With respect to social contribution activities in regional areas, since 2013 Rinnai has been participating in
the Nakagawa Canal Restoration and Culture/Art Activity Assistance Project (ARToC10), headed by the Nagoya
Urban Institute of the Nagoya Urban Development Public Corporation. This project is aimed at restoring the
Nakagawa Canal, which flows near Rinnai’s Head Office. We also focus on other activities linked to local
communities. These include visitations to elderly care facilities, tours of our factories, and neighborhood cleanup
campaigns.
Raising corporate value by addressing national and regional needs
Going forward, Rinnai will continue targeting steady growth as a comprehensive manufacturer of heat-energy
appliances in order to raise corporate value and thus meet the expectations of society. In Japan, we look forward tofurther growth in the field of room heating, where significant potential remains. On the global front, we notice
opportunities in many regions. In addition to China, where consumption sentiment is high despite slowing
somewhat, these include Southeast Asia, Africa, and Europe. In overseas markets, local lifestyles, customs, andenergy-related circumstances are different from those in Japan, and so require a different approach. To enablebusiness operations tailored to national and regional attributes, we endeavor to employ local people to handle
management of our overseas subsidiaries. We also use pursue initiatives that take local circumstances into account
while deploying skills and knowledge acquired in Japan. Based on the themes of “heat” and “lifestyles,” we willcontinue working hard to realize a safe, secure, healthy, and environmentally friendly society, both in Japan andaround the world.

5

06

CSR Report
Repo 2014

07

Rinnai GroupJAPAN

Rinnai Group Network●Rinnai Corporation● Manufacturing and sales companies● Sales companies ● Other Business

SOUTH KOREA●Rinnai Korea Corporation

Rinnai Services (MS)Corporation●RB Korea Ltd.

●
●Rinnai UK Ltd.

CHINA●RS Korea Ltd.

●Shanghai Rinnai Co., Ltd.

●Rinnai Plus Corp.

●Mikuni RK Corporation●Shanghai RB Controls Co., Ltd.
●

●Guangzhou Rinnai Gas and Electric Appliance Co., Ltd.

Rinnai Italia s.r.l.

●Hainan Rinnai Minsheng Kitchen Appliances Sales Co., Ltd.

●Yanagisawa Manufacturing Co., Ltd.

Branches: Tohoku, Kanto, Chubu,
Kansai, Kyushu
Domestic sales offices: Hokkaido,
Sendai, Niigata, Tokyo, Kita-Kanto,
Higashi-Kanto, Minami-Kanto,
Nagoya, Shizuoka, Hokuriku, Nagano,
Osaka, Keji, Hyogo, Chugoku,
Shikoku, Fukuoka
Laboratory: Technology Development
Center
Factories and related centers: Oguchi
Factory, Seto Factory, Asahi Factory,
Akatsuki Factory, Production andTechnology Development Center,
Integrated Logistics Center, Parts Center●Guangzhou Rishangsheng Gas and Electric Appliances Sales Co.

●Rinnai Technica Co., Ltd.
●RB Controls Co., Ltd.
●Rinnai Precision Co., Ltd.
●RT Engineering Co., Ltd.
●Japan Ceramics Co., Ltd.
●Noto Tech Co., Ltd.
●Techno Parts Co., Ltd.
●Glanstrahl Co., Ltd.
●Rinnai Net Co., Ltd.
●RG Co., Ltd.

●Rinnai Canada Holdings Ltd.

●Rinnai Enterprises●Rinnai Tech Hokuriku Co., Ltd.
●Rinnai Kogyo Co., Ltd.
●

●Shanghai Rinnai Thermo Energy Engineering Co., Ltd.

Rinnai Hong Kong Ltd.●

Rinnai America Corporation●Rinnai Taiwan Corporation

Rinnai (Thailand) Co., Ltd. ●Rinnai (Malaysia) Sdn. Bhd.
●Rinnai Holdings (Pacific) Pte Ltd.

Water heaters¥146.8 billion (+15.5%)

Home heaters¥16.7 billion (+6.7%)●P.T. Rinnai Indonesia

Incorporated: September 1, 1920

(Billions of yen)

Commercial-use equipment¥7.5 billion (+9.3%)●(As of March 31, 2014)

Net Sales by Region (Year ended March 31, 2014)(Billions of yen)
Others¥27.7 billion (+19.1%)●Rinnai Vietnam Co., Ltd.

Corporate Data

Net Sales by Product (Year ended March 31, 2014)

Total

South Korea¥26.7 billion (+26.3%)¥286.9 billion(+14.0%)Established: September 2, 1950
Paid-in capital: ¥6,459,746,974

China¥19.0 billion (+48.9%)
Australia¥15.2 billion (+10.9%)
United States¥15.4 billion (+36.6%)

Others¥15.7 billion (+29.4%)
Japan¥194.5 billion (+7.8%)

Total¥286.9 billion(+14.0%)Kitchen appliances¥88.0 billion (+11.7%)

Head office: 2-26, Fukuzumi-cho,
Nakagawa-ku, Nagoya 454-0802, Japan
Number of employees: 9,593 (consolidated),
3.629 (non-consolidated)

Rinnai Australia Pty., Ltd.
●

Parentheses indicate
percentage changeover previous
corresponding period.

Parentheses indicate
percentage changeover previous
corresponding period.

Rinnai Brasil ●Heating Technology Ltd.

●Rinnai New Zealand Ltd.

Number of Group companies: 40 (domestic 14, overseas 26)

Water Heaters and Heating Systems
With superior energy efficiency, Rinnai’s water
heaters and heating systems meet the needs ofpeople for more sophisticated, comfortableliving, offering such functions as floor heating
and bathroom heating.

Kitchen Appliances
Rinnai continues to improve the safety and convenienceof its stoves, which now have temperature sensors fitted
to all burners. We are also creating new products withexceptional designs to meet the needs of the times.

Home Heaters

Commercial-Use Equipment

Seeking to create comfortable living
spaces offering total relaxation and peaceof mind, Rinnai develops a wide array ofhome heaters.
Commercial-use stoves, ranges,
rice cookers, industrial ceramics
machines, steam oven, and others

OthersWater heaters, water heater with heating units, hybrid water heater with heating
system, bathroom heater/dryer, mist sauna, floor heating systems, and others

Tabletop cookers, built-in hobs, dishwashers, rice cookers, built-in
ranges, range hoods, and others

Fan heaters, fanned flue heaters, infrared heaters, gas fires, andothersClothes dryers, infrared burners andcomponents

CSR Report 2014│Corporate Mission and VisionCorporate Mission and Vision
Basic Concepts

Quality is out destiny
Company Motto
Harmony:
Develop personal character of the highest caliber
Spirit:Base your efforts on a consistent philosophy
Sincerity:
Know the fundamentals and consider issues with precisionand clarity

Rinnai’s Corporate Mission
Rinnai utilizes heating to provide society with a comfortable way of life.

Schematic Diagram of Company Ideals

8CSR Report 2014│Corporate Mission and Vision

Rinnai Charter
1. We are committed to keeping our customers first and foremost in our minds with our policy of “Quality is ourdestiny.”
2. We are committed to pursuing safety, comfort, and convenience, and to providing products that help topreserve the global
environment.
3. We are committed to acquiring and utilizing expertise in heating to improve our customers’ quality of life.
4. We are committed to strengthening the relationship between Japanese and overseas Rinnai Group members andto working foreach other’s prosperity.
5. We are committed to enhancing the prosperity of the communities that we belong to and to building a
reputation as trustworthy
and responsible members of society.
6. We are committed to operating under the principles of harmony, spirit and sincerity, and to growing ourcompany by ensuring
the prosperity of society.
7. We are committed to acting in compliance with the law and to adhering to ethics as responsible members ofsociety.

Rinnai Code of Conduct
1. General provisions

8. Relation with clients

2. Scope of application

9. Relation with politics and administration

3. Legal compliance

10. Safety and health

4. Product and service safety

11. Respect for human rights and personality

5. Environmental conservation

12. Protection of the company property

6. Contribution to local community

13. Measures to antisocial foces

7. Relation with shareholders and investors

Three Key Themes
Since its establishment, Rinnai has grown and developed through an unshakable focus on three themes. Part andparcel of the Rinnai Spirit, these themes are and always will be integral to our success.

Heat and
Lifestyles
Quality
Contributing
to LocalCommunities

Rinnai’s corporate mission hinges on the use of “heating” to provide society with “comfortable
lifestyles.” Our strength is in sophisticated heating technologies, and we will utilize thiscapability to facilitate the creation of pleasant living environments.
Rinnai’s catchphrase—“Quality is our destiny”—epitomizes a corporate obsession withquality. So it is only natural that we would keep production and other monozukuri(manufacturing) efforts in-house to sustain high-level standards. This enables us to deliversafety and peace of mind to our customers.
At Rinnai, we firmly believe that contributing to a better lifestyle culture in local communities
is vital to our role as a good corporate citizen. Basic strategies for expanding our presence
abroad require that sales and services are executed with local conditions in mind and that
manufacturing takes place in the markets where the products will be sold.

9

CSR Report 2014│Corporate Mission and Vision

The Birth of Rinnai
Rinnai uses reliable technologies to create “heat and lifestyles” while embracing the spirit of
its foundation
One November day in 1918, Hidejiro Naito stood mesmerized in front of a shop making imagawayaki,
a traditional Japanese bun usually filled with adzuki bean paste. He was intrigued by the blue flamethat came from the imported oil-burning cooking stove used to cook the imagawayaki. Keen to try his
hand at making a similar stove, Hidejiro convinced the shop owner to part with the stove. Using it asa model, Hidejiro subsequently developed a petroleum-fuelled stove, heralding the origin of thebusiness we know today.
Two years later, in 1920, Hidejiro left his job at Nagoya Gas (currently Toho Gas Co., Ltd.).
Together with Kanekichi Hayashi, a childhood friend who lived in the same dormitory, they established
Rinnai & Co., the forerunner of today’s Rinnai Corporation. The company name was coined fromcharacters in the two men’s last names (“Rin” is another way of reading “Hayashi,” and “Nai” comesfrom “Naito”).
Thus began nearly a century of developing the latest heat-energy appliances. Over the years,
Rinnai’s products slowly transformed Japanese lifestyles as the nation continued on its path tomodernization. From its origins through to the present day, Rinnai has been guided by its Corporate
Mission, which is “to use heat to provide society with comfortable lifestyles.” The ethos of contributing
to society—evident in the early catalog for Rinnai’s original, petroleum-fuelled stove—has enduredunchanged through to the present day.
Today, Rinnai’s vision hinges on the three themes of “heat and lifestyles,” “quality,” and“contributing to local communities.” As a comprehensive manufacturer of heat-energy appliances,
Rinnai contributes to people’s lifestyles around the world and to the global environment. Despite all
the changes to society and products that have taken place, Hidejiro’s pioneering spirit remains as
unshakeable today as it was then.

10

CSR Report 2014│VISION AND MEDIUM-TERM BUSINESS PLAN

Vision and Medium-Term Business Plan
Operating Environment for Heat Appliance BusinessMedium-Term Business Plan “Jump UP 2014” (From April 1, 2012 to March 31, 201511

CSR Report 2014│VISION AND MEDIUM-TERM BUSINESS PLAN

Our Vision

Medium- and Long-Term Growth Trajectory

12

CSR Report 2014│VISION AND MEDIUM-TERM BUSINESS PLAN

Consolidated Data

13

CSR Report 2014│Rinnai Group CSR

Rinnai Group CSR
Approach to CSR
Rinnai’s corporate mission hinges on the use of heat to provide society with comfortable lifestyles. This perspective
infuses efforts on a groupwide basis to provide heat-energy appliances with excellent features that stress safety andpeace of mind, comfort and the environment, and thereby contributes to better lifestyles for people around theworld and a better outlook for the planet.
The Group pursues CSR activities through core operations, emphasizing four issues that complement thethree key themes—“heat and lifestyles,” “quality” and “contributing to local communities”—that Rinnai has set out
for itself and the Group it leads.

Environment

Heat and Lifestyles

Quality

Contributing toLocal Communities

Hot water and heating appliances account for much of the energy used in the averagehome. By developing, manufacturing, and selling appliances with exceptional energy
efficiency, Rinnai helps reduce emissions of greenhouse gases from homes.
To fulfill our Corporate Mission, which is “to use heat to provide society with comfortable
lifestyles,” we deploy our advanced technologies and know-how to develop products thatpeople can use in a safe, comfortable, and efficient manner. In this way, we help people
lead abundant lifestyles.
To offer customers safety and peace of mind, we adhere to the basic tenet that “Quality is
our destiny.” To this end, we pursue a “zero defects” objective when designing, making,and selling our products, to ensure they remain fault-free until they are no longer used by
the customer.
Rinnai’s aim is to deliver products and services that meet climates, lifestyle cultures, andcustoms that differ from Japan. In principle, we focus on local production and local sales inadvancing our overseas business, so that we can help improve the lives of local people
around the world.

Returning Added Value to All Stakeholders
Together with stakeholders, we will strive for continuous growth by returning the economic value obtained throughRinnai’s business activities to stakeholders, thus fostering sustained mutual advancement.

14

CSR Report 2014│Rinnai Group CSR

Environmental Policy
Rinnai’s environmental initiatives are underpinned by the “Basic Philosophy on the Environment,” “Environmental
Slogan,” and “Basic Environmental Activities” (“7 E Strategic Initiatives” set out below. Our efforts extend beyond
the development of environmentally responsible products that reduce energy consumption when in use andinitiatives aimed at reducing greenhouse gases.
We recognize how our diverse activities—including the development, procurement, production, sale, anddisposal of products—are inextricably linked to the global environment. Accordingly, all Group employees engage
in environmental initiatives across all business domains.

Basic Philosophy on the Environment
Rinnai’s basic philosophy is to embrace environmental protection on a global scale and contribute to society
through the pursuit of excellent, people- and planet-friendly technology, and product development, production,
sales and service infused with a sense of humanity.

Environmental Slogan“Our actions are imbued by the wisdom of many and undertaken with due consideration to the sustainability ofa people- and earth-friendly environment.”

Basic Environmental Policy
1. Provide environmentally conscious products that have minimal impact on the environment.
Through the diligent pursuit of product development stressing reduced consumption of resources and energy andhigher recycling rates as well as eco-minded materials procurement (E-Procurement), we will provide
environmentally conscious products (E-Products) that have minimal impact on the environment and contribute to ahealthier planet.
2. Create green factories and offices with the environment in mind.
We will emphasize activities that save energy, reduce waste and limit or eliminate hazardous chemical substances,and we will work toward the establishment of environmentally sustainable factories and offices—E-Factory and EOffice—that fit in with the natural surroundings.
3. Consider how sales and service activities might affect the environment.
We will reduce the impact that sales (E-Marketing), services (E-Service) and other business activities in general
might have on the environment.
4. Formulate an environmental management system and continuously improve it.
We will formulate an environmental management system and continuously enhance its scope through theestablishment and management of appropriate environmental objectives and targets.
5. Ensure activities are in compliance with regulations and restrictions, including laws, and self-establishedstandards.
Obviously, we will abide by laws, ordinances, agreements and other regulations and restrictions, but we will also
set and adhere to self-established standards corresponding to social demands. We will always strive to enhance our
response to meet revised regulations and evolving standards.
6. Raise environmental awareness among employees and work with communities to contribute to society.
We will raise environmental awareness among all employees through environment-themed training, and we will
promote activities undertaken jointly with regional communities and other groups to achieve public good. This
perspective is called e-mind.
7. Disclose information to employees and the communities in which we work.
We will disclose environment-related information, such as policies and strategies, to keep employees and society atlarge in the loop about our perspectives and actions on environmental issues.

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CSR Report 2014│Rinnai Group CSR

Basic Environmental Activity“7E” Strategic Initiatives: Green Activities Involving All Employees in All Business Areas

16CSR Report 2014│Identifying CSR Material Issues

Identifying CSR Material Issues
Process of Identifying CSR Material Issues
We actively take on board the opinions and expectations of various different stakeholders and incorporate them into
our CSR activities, in the interests of the continued development of both the Rinnai Group and all of its
stakeholders. As well as enhancing our corporate value, we believe that ongoing activities such as these help our
stakeholders to grow and contribute to the creation of a more sustainable society.
We make every effort to identify social challenges relating to the Rinnai Group, through day-to-day
communication activities with stakeholders coupled with study and analysis of applicable guidelines and SRI
indices. We also identify CSR material issues in relation to our management strategies, revolving primarily aroundcorporate planning divisions.

17

CSR Report 2014│Identifying CSR Material Issues

Determining and Identifying CSR Material Issues
We have determined social challenges relating to the Rinnai Group, analyzed their level of importance tostakeholders and the Group, and identi_ed CSR material issues.
As well as being matters of interest to stakeholders, these are high-impact issues that are also positioned
as top priorities within the Rinnai Group’s management strategy.

Focus of initiatives
Environmental initiatives
CSR Material Issues- Reducing energy consumption- Reducing CO2 emissions

Roughly half of all energy consumed by Japanese households is used for
hot water and heating. Reducing energy consumption and CO2 emissions
in the hot water and heating sector is therefore a top priority.

Target Area and Stakeholders
Target area: Global (Main focus of initiatives: Japan)
Target stakeholders: All
18

CSR Report 2014│Identifying CSR Material Issues

Details of Initiatives
We intend to develop and encourage households to use water heaters and heating units with an emphasis on energy saving andenvironmental performance, in an effort to reduce energy consumption and reduce household CO 2 emissions.

Initiatives Delivering Safety and Peace of Mind
CSR Material Issues- Consumer safety

Tackling potential accidents in the home, including kitchen fires and fatal
accidents in the bathroom, is becoming a top priority as Japan becomes anaging society.

Target Area and Stakeholders
Target area: Japan
Target stakeholders: Customers

Details of Initiatives
We intend to promote stoves fitted with sensors for improved safety performance, and heaters (bathroom
heaters/driers) to warm up bathrooms, and to raise awareness of how to prevent related accidents, in an effort to
reduce the number of fires and fatal accidents in the home.

19

CSR Report 2014│Communication With Our Stakeholders

Communication With Our Stakeholders
Two-Way Communication Initiatives
Throughout the Rinnai Group, we place great importance on communication with customers, employees,
shareholders, investors, business partners, local communities and the general public.
We take on board comments and requests from our customers through channels such as exhibitions andour online shopping site, and use them to help us improve our products and services. We exchange information
with our business partners on subjects such as management policies and products, and also work together toimprove management through activities such as our Level-Up Workshop and Shipping Subcommittee.
We will continue to engage in communication with all of our shareholders on a daily basis, so that we can evolveour business activities and improve levels of satisfaction even further in the future.

Communication with Our Stakeholders

20

CSR Report 2014│Communication With Our Stakeholders

Stakeholder Engagement: Processes and Activities
Key
Stakeholders

Opinions and issues raised, and our response(selected examples)

Methods of Communication
Customers


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





Employees










Shareholders/ Investors

Business
partners







Community/ Society・Customer Center (handlinginquiries, arranging repairs)
・Questionnaires
・Customer visits (inspections,repairs)
・Exhibitions/events
・Online shopping site
R.STYLE (RINNAI STYLE)・We conscientiously address and respond to a wide range of inquiries
related to products and parts from our customers, and post frequently
asked questions on our website.
・Following repairs, we ask customers to complete satisfaction surveys
including areas such as “ease of contacting the Customer Center’s tollfree number” and “politeness of telephone operators”. Details ofcustomer responses are then fed back to individual operators, so thatthey can make improvements in any unsatisfactory areas.
・In response to questionnaires after user registration, customers
indicated that they would “prefer registration to be handled by store.”
In July 2012, we revised our user registration procedure and madeimprovements such as providing better explanations and enablingcustomers to request store to perform registration for them.

・Workplace meetings with union
representatives
・Employee satisfaction surveys
・Workplace presentations onrevisions to personnel systems
・Committees
・Intranet/in-house newsletter
・Training/events・Individual discussions
・Corporate ethics consultation
service・We have set out a number of schemes to create a more pleasantworking environment, including our Come-Back scheme, reduced
working hours and the option to work from home. We are constantly
exploring ways to improve conditions, both tangible and intangible.
・We introduced individual discussions after employees told us thatthey wanted feedback on personnel evaluation results, and actively
encourage each of our headquarters to provide feedback.
・Having received requests to extend our reemployment period, werevised the relevant system and increased the maximum age for
reemployment in selected areas from 65 to 68.

・General Shareholders’ Meeting・Results briefings
・IR meetings・Factory tours for institutional
investors
・Seminars for individual
investors
・Questionnaires

・We regularly organize facility and factory tours for institutional
investors, to give them a better understanding of our strengths andcompetitive advantages, and to outline our philosophy on
manufacturing and technical capabilities.
・We hold results briefings and individual IR meetings to addressinquiries regarding our dividend policy, and to explain our underlying
thinking.

・New Year meetings
・Policy presentations for
suppliers
・Level-Up Workshop
・R-LINE*
・R-TALK*・Supplier Liaison Group・Participation in
local/community development
activities
・Support for cultural activities
and the arts
・Employee volunteer activities
・Assistance with social studies(factory tours, etc.)







・As well as responding to inquiries regarding current productionlevels, we also provide production data for individual products anddetails of future production plans via regular Supplier Liaison Group
meetings.
・In response to advice and requests from suppliers, regarding
initiatives to improve quality or productivity for example, we organize
Level-Up Workshops for major suppliers and provide them withguidance on improvements in the workplace. We also assist supplierswith management improvements.
・We often receive requests from local people asking us to assist with
events or festivals aimed at breathing new life into the local
community. We are always eager to participate in such events as anintegral member of the community.
・In response to requests to assist with social studies for local residents
or school education, we organize events such as seminars on thehistory of manufacturing at Rinnai and factory tours for elementary
school students.

*R-LINE and R-TALK are online communication tools for coordinating information with suppliers.

21

CSR Report 2014│Communication With Our Stakeholders

CSR Report 2013 Questionnaire Results

n＝411

Opinions received in response to questionnaires (sample)
Q: What do you expect from the Rinnai Group in terms of energy?
・As well as focusing on product convenience and usability, I want Rinnai to be a company that actively focuseson energy, to make life more comfortable in developing countries as well as in Japan.
・I would like to see Rinnai developing appliances for use in an emergency, in the event of an earthquake, andmaking more of an effort as a company to address renewable energy in the future.
・Develop technology capable of reducing consumption of limited fossil fuels even further, and focus ondevelopment of alternative energy sources.
・Living environments in Japan are far from ideal as they still require people to endure seasonal hardships insome respects. I would like Rinnai to do its bit to make Japan a better place to live, as an environmentallyadvanced country.
Q. General assessment, opinions, impressions, etc.
・Rinnai understands that it has a responsibility to all of its stakeholders, including its employees. I hope you canharness this passion to continue contributing to society in the future.
・There are question marks regarding why Rinnai engages in certain activities or provides certain types of
support. I would to see more detailed explanations of underling reasons and background information.
・Before working on energy policies, you should focus on making your own products safer.
・The environment is obviously important, but above all, we want to have safer products that are easy to use.
・I want Rinnai to be economically sound and reliable, and to do what’s best for regular people.

22

CSR Report 2014│Management System

Management System
Corporate Governance
Toward Enhanced Transparency
From the perspective of a sharper competitive edge for the Group and sustained improvement in corporate value,
Rinnai has made efforts to augment practices and enrich the scope of corporate governance top management
priorities. We aim to reinforce the functions of corporate structures, such as the Board of Directors and the Audit &Supervisory Board, and seek a higher level of management transparency, which will be achieved through quick andaccurate disclosure of pertinent information to various stakeholder groups and through access to a wide range of
information.

Internal Control System
We regard the following four items as the aims of our internal control as we seek to reinforce our management
system and fulfill our social responsibilities. Through means such as risk management and internal auditing werevise as necessary the basic policy on establishment of an internal control system that we instituted in May 2006,
in our efforts to reinforce this system.
Objective of the Internal Control System
1. Effective and efficient operations
2. Reliable financial reporting
3. Adherence to laws and regulations affecting business activities
4. Safeguarding assets
To respond to the Internal Control Report System under the Financial Instruments and Exchange Act, which was
first applied in April 2008, our Group ensures the reliability of our financial reporting by having the Internal
Control Office, an independent division, select Group companies and business processes that will have a material
impact on our entire financial reporting on a consolidated basis, and evaluate the effectiveness of theirorganization and application.

Structure for Monitoring Management Performance
Rinnai has four corporate auditors, two of whom are outside auditors.
Corporate auditors attend important meetings, including those of the Board of Directors. They also
monitor internal control status—that is, progress on the establishment of internal controls and implementationof associated practices—with a focus on the results achieved by directors and executive bodies, and they
check on the status of operations and asset management at the head office and principal branches.
In addition, an external accounting firm undertakes accounting audits and verifies the soundness ofaccounting-oriented internal controls from a third-party perspective.

23

CSR Report 2014│Management System

Board of Directors
The Board of Directors has decision-making authority for important management issues affecting Rinnai andoversees the execution of duties by directors. The Board has seven members (including one outside director)
and as a rule meets once a month. Some directors below the rank of president hold concurrent positions as
executive officers and are responsible for conveying the content of Board decisions to the managers ofdivisions under their respective supervision and for executing operations. In addition, general groupwide
meetings as well as parent-only meetings are held every three months so that directors can pinpoint the statusof issues affecting operations and share information on pertinent topics. Moreover, to clarify the
management responsibilities of each business year and gain trust from shareholders, Rinnai regulates theterm of director to be one year.

Director Compensation
The limits of compensation for Directors and Auditors are determined in accordance with the resolution of
the general meeting of shareholders. Moreover, the Rinnai’s internal regulations stipulate fundamental
matters related to Directors’ compensations including the method of determination, revision and reduction.
Based on these, the amounts of compensation for Directors are resolved at the Board of Directors and theamounts of compensation for Auditors are determined through the deliberations by Auditors. Directors arepaid a fixed amount commensurate with assigned duties. Please note that Rinnai terminated the retirement
benefit system for directors, following approval of a proposal put forward at the General Meeting of
Shareholders on June 27, 2008.

Information Disclosure
For timely and appropriate disclosure of important information on the Group, we facilitated the internal
regulations and established "Disclosure Policy", which is listed on our website, as the guidelines for
information disclosure.

Corporate Governance Structure

24CSR Report 2014│Management System

Risk Management
Risk Management Promotion System
As social structures become more complex, the risks faced by companies are becoming more diverse. As the
Rinnai Group continues to expand its business globally within this environment, we are committed to risk
management in order to ensure stable business activities that sustain the trust of customers and society as a whole.
To achieve that, we hold regular meetings of the Risk Management Committee, chaired by the president. The
committee assigns a division to oversee each risk with the potential to influence our corporate survival,
credibility, business pursuits and assets, and is also tasked with risk-lowering duties, such as formulating
preventative measures, resolving issues before they turn into crises, minimizing losses and defining strategies toavert the recurrence of any risks that become a reality. Methods for hedging risk are promoted laterally
throughout the Group.
Identified risks (examples) ・Risk of non-compliance or management in violation of applicable legislation, etc.
 ・Risk of destruction or damage to factories, buildings or production facilities due to a disaster or accident ・Risk of suspension or delays with raw material procurement activities ・Risks relating to the environment
 ・Risk of bodily injury
 ・Risks relating to information leaks
 ・Risk of damage to mission-critical systems
 ・Risk relating to social media
 ・Risks relating to infection from new strains of influenza, norovirus, etc.

Information Securities Measures
While society becomes more demanding toward company’s security reinforcement issues, our Group as a wholepromotes the adequate management of security systems by strengthening the awareness for proper information
handling through the establishment of the rules for confidential information management and the personal
information management. User authentication technology was adopted company-wide to manage accesses to IT
system and an entry/withdrawal management system with ID cards has been introduced to various businesslocations including Technology Development Center one by one.
In addition, to avoid information leakage, we have been enforcing a strict management of the external use
of personal computers, encryption of data stored in media to be used outside of the office, unauthorized access byoutsiders and virus and spam countermeasures.

Promotion of Businesses Continuity Plan
When companies have no sufficient measures for natural disasters such as earthquakes and storms and theprevalence of infectious diseases, the business operations may be suspended for a long time, result in a significant
damage and give a serious impact on stakeholders. As a company which produces thermal energy appliance tosupport people's lifestyles, we believe it is our responsibility to maintain the stable supply of our products evenunder such circumstances.
We have positioned business continuity management as our of top priorities, in the event of any risks tothe production or supply of important products required by our customers, and are constantly working toformulate and review business continuity plans (BCP), particularly for our domestic production divisions. Basedon our experiences from the Great East Japan Earthquake on March 11, 2011, we are exploring alternative raw
material suppliers and procurement sources, and continue to use multiple procurement sources on a daily basis, sothat we are prepared for any large-scale earthquakes in the future, including the Nankai Trough.
25

CSR Report 2014│Management System

Compliance
Compliance Promotion System
To remain a sound corporate group which wins the trust of society, the Corporate Ethics Committee wasestablished in April 2004 headed by our President as its chairman. To promote compliance as part of ourcorporate culture, individual employees strive to live up to their social responsibilities and create a workplace thatencourages people to actively engage in their work.

Corporate Ethics Committee
Chairman(President)

Measurements

Committee members(Selected fromeach headquarters)

Secretariat office(Legal department)• Establishment, revision, training andenforcement of "Code of Ethics"• Establishment and operation of “Corporate
Ethics Helpline”• Investigation of violation of "Code of Ethics”
Deployment

Each department

Rinnai Group “Code of Ethics”
The Rinnai “Code of Ethics” is a small booklet which combines Rinnai’s Corporate Philosophy and Code of
Conduct, which embodies the detailed behavioral standards that all executives and employees are required toobey. The Compliance Committee member allocated to each workplace provides all employees in theworkplace with “Code of Ethics” training each year for its enforcement.
The English-version “Code of Ethics” was issued and distributed to the 18 overseas Group
companies, and local language versions were distributed to Group companies in China and South Korea.

“Code of Ethics” booklets
of various countries“Code of Ethics” training sessions at Rinnai (Malaysia) (left)
and Rinnai Vietnam (right)

26

CSR Report 2014│Management System

Compliance Promotion Activities
Compliance Education Activities
Within the company, the President himself takes the initiative by sending messages on corporate ethics to
employees to improve their awareness of compliance issues.
Moreover, regarding specific laws that individual departments have close relationship with, the Legal
Department takes the lead by providing legal education every year. In fiscal 2014, a total of 563 Group employees
undertook training to improve their knowledge of the law.
We also provide ethical education for new recruits and for employees in specific job classes every year,with a total of 288 employees attending sessions in fiscal 2014.

Legal education

Fiscal 2014, Actual of number of training attendants
Name of course
Number of attendants
Legal education
563 people
Ethic education by layer
288 people

Information Distribution to All Employees
Every October, we carry out promotional activities as part of our own Corporate Ethics Month. We post amessage on corporate ethics from the President himself on the intranet and display compliance-themed posters inall workplaces.
We also post details of revisions to legislation and provide a variety of other information for domestic
group employees via our intranet.

Message from the President during Corporate Ethics
Month (intranet)

Compliance education poster

27

CSR Report 2014│Management System

Confirmation and Modification of Compliance Activities
Every year, we conduct employee questionnaires to ascertain how deeply ingrained our Corporate Philosophy has
become. In fiscal 2014, breaking down the penetration rate for each component of our corporate philosophy, we
found that 99.3% of respondents were familiar with the corporate motto and 99.8% recognized our corporate
mission. We will continue to actively promote compliance activities to maintain these high levels.

Facilitation of Internal Reporting System
If, in the course of business activities, an employee at adomestic company under the Group umbrella suspects
possible breach of laws or the internal rules or unfair
practices, and it is difficult to approach a superior or the
person responsible for the division with such suspicions,the employee may report the perceived infraction to the
Corporate Ethics Helpline.
In this system, we stipulated that the person who reported
the incident will not receive any unfair treatment by thefact that he/she consulted the matter and we also pay a full
attention to the protection of privacy of the person who
made the report.
In fiscal 2014, the helpline received eight calls for
consultation and report. Appropriate measures have beentaken, including investigation and confirmation of the facts
in these cases of alleged misconduct.

* Breaches of laws, regulations, internal rules and ethics* Confirmation of illegal activities
Found it hard to consult
with a supervisor
Consult with a supervisor or the
person responsible for the division

SolvedNot solved
Corporate Ethics Helpline

Reward and Disciplinary Committee
To maintain fair working environment, we apply strict measures to an employee who breached the internal rules,
Code of Ethics or committed unfair practices based on the working rules under the guidance of the Reward andDisciplinary Committee.

Protecting Personal Information
Rinnai applies internal rules based on the Act on the Protection of Personal Information. In addition, our Privacy
Policy was instituted for the handling of personal information and posted on our website. Utilizing these, we
strive to ensure appropriate storage, handling and protection of customer data.
Accordingly, we established the position of Chief Privacy Officer at the head office and require theappointment of privacy officers at all workplaces, including the offices of Group companies in Japan, to educate
employees who handle personal information, and to establish physical and technical systems to insure the safe
management of personal information in each workplace.
The privacy officers also conduct an internal audit once a year to verify the quality of personal
information management in each workplace. There were no instances of personal information being leaked infiscal 2014.

Compliance Violations
There were no serious compliance violations in fiscal 2014.

28

CSR Report 2014┃Major Award Winning History

Major Award Winning History
Rinnai received following awards from April 1, 2013 to September 30, 2014.

Rinnai Corporation
June
2013

AugustOctober
DecemberJanuary

2014

June

AugustTechnology Award 2013 from The Japan Gas Association
Aichi Invention Award 2013 from Aichi Invention Association
Electrical Machinery Packaging Prize of Japan Packaging Contest 2013
Good Design Award 2013
CNET Japan CMO Award
Top Energy Conservation Awards, METI Award, in the fiscal 2013
Aichi Invention Award 2014 from Aichi Invention Association
Technology Grand Award 2014 from The Japan Gas Association
Commendation from the Commissioner of the Fire and Disaster Management Agency for
Oguchi Factory as a superior facility which handles hazardous materials

Large and Heavy Good Packaging Prize of Japan Packaging Contest 2014

RB Controls Co., Ltd.
2013

October

2013 Good Design Award

Rinnai Korea Corporation
September

2013
December

2014

March

Commendation from South Korean President: Superior company for the long-term

emloyment
Brand Survey by KMAC: Company which a customer recommends mostNo. 1 at home-use boiler section
Award by Korean government: Superior company which contributed to job creation
Brand Survey by KMAC: Korea Brand Power Index
No.1 at gas range section
P.T. Rinnai Indonesia

2013
2014

2013

September
September

October

Platinum Award in the tabletop cooker category of the 2014 Indonesia Best Brand Awards
Platinum Award in the tabletop cooker category of the 2014 Indonesia Best Brand Awards

Rinnai New Zealand Ltd.
Gold prize at Best Effect section, Good Design Award

29

CSR Report 2014│Environmental Initiatives

Environmental Initiatives
Reducing Energy Consumption and Reducing CO2 Emissions
Targeting increased adoption of high-efficiency water heaters
Global warming and the depletion of resources are important issues that must be tackled on a global scale. Water androom heating account for more than 50% of household energy consumption. As a comprehensive manufacturer ofheat-energy appliances, Rinnai develops and promotes highly efficient energy appliances for the home. By promoting
reduced household energy consumption and achieving reduced CO2 emissions through the use of these appliances,
our aim is to help solve the problems facing the global environment.

Preventing global warming: An important international challenge
Global warming is purported to cause various phenomena, including abnormal weather patterns, massive floods, anddroughts. The increase in greenhouse gas emissions generated as a result of human activities is believed to be themajor trigger for such extreme events*.
Increases in greenhouse gas concentrations raise global surface temperatures, which until recently had
served to maintain stable temperatures. Today, however, the massive consumption of fossil fuels and other factors
have caused an extreme greenhouse effect, resulting in higher global temperatures. These higher temperatures arehaving a considerable impact on weather, climate, and even eco-systems. With carbon dioxide (CO2) being one
greenhouse gas, reducing the amount of CO2 emissions is a pressing issue requiring action on an international scale.
Viewed from the perspective of inputs, due to the finite amounts of natural resources and energy forms
available on earth, such as petroleum and natural gas, it is critical that we reduce energy consumption without delay.
For the record, it is said that petroleum resources will be depleted in 40.6 years and natural gas in 66.7 years.
On the output side, high CO2 emissions are generated by industries, which use huge amounts of fossil fuels.
Japan’s industrial sector has already had a significant impact on lowering emissions through various emission
reduction measures. As a result, we cannot expect to see dramatic reductions in industrial emissions in the future.
Therefore, the focus of attention has switched to the residential sector and its efforts to lower emissions. Although
the volume of emissions generated by an individual household is miniscule compared with the industrial sector, thecombined effect of a decrease in emissions by a majority of households would be significant.
* Source: Fifth Assessment Report by the Intergovernmental Panel on Climate Change (IPCC).

Saving energy and reducing CO2 emissions in the water and room heating sectors
In Japan, water and room heating account for around half ofhousehold energy bills.
Gas appliances provide “heat” to homes for a number of
purposes, such as the heating of bath water and rooms. Across a
product’s entire lifecycle, which includes manufacturing through touse and disposal, the stage that uses the highest amount of energy iswhen it is used by the consumer, with CO2 the highest of all
greenhouse gases generated. This is why initiatives targeting the
reduction of CO2 emissions generated by heating water and rooms
will lead to a decrease in Japan’s overall CO2 emissions.
30

CSR Report 2014│Environmental Initiatives

Energy-saving and environmental benefits of gas water heaters
Rinnai is currently switching to its high-efficiency Eco Jozu products for gas water heaters and hot-water-type gas
floor heating systems. Eco Jozu is a high-efficiency gas water heater that has raised the thermal efficiency of water
heaters from the existing limit of around 80% to as high as 95% through the use of an exhaust gas heat recovery
system. Today, Eco Jozu accounts for around 80% of Rinnai’s sales of all water heaters with heating systems.
Rinnai has utilized Eco Jozu’s energy-saving technology to develop a proprietary hybrid water heater withheating system called ECO ONE. The system combines a high-efficiency Eco Jozu gas water heater with an airsourced heat pump. With ECO ONE, Rinnai has increased the primary energy efficiency dramatically to 125%.
“Primary energy” refers to any form of energy in its naturally occurring state, including coal, oil, and natural gas.
The primary energy efficiency of a water heater is the volume of hot water produced equivalent to the amount ofprimary energy input.
ECO ONE realizes around 40% lower primary energy consumption for water heaters compared with theenergy efficiency reference value used in Japan. This huge reduction in primary energy consumption enables primaryenergy consumption of an entire residential system to be cut by around 10% vis-à-vis the energy efficiency reference
value.
The ECO ONE system does not require a large tank because it doesn’t need to heat a day’s worth of hot
water and keep it at a high temperature. Even when there is no more stored hot water, the gas water heater is able toheat water instantaneously.

Eco Jozu, RUF-E2405AW SeriesHybrid water heater with heating system called, ECO ONE

31

CSR Report 2014│Environmental Initiatives

The eco-friendly ECO ONEECO ONE delivers excellent energy savings, environmental friendliness, convenience, and comfort. But what sort of
reduction in the country’s total CO2 emissions could we expect to see if ECO ONE were the only type of hot-water
unit used in Japan?
According to Rinnai estimates, there would be an estimated annual reduction of CO2 emissions of around
31 million tons. This amount is equivalent to 2.6% of Japan’s total CO2 emissions.
ECO ONE’s advanced environmental performance is well recognized. It received the METI Award—the
top prize in the Fiscal 2013 Energy Conservation Awards hosted by the Energy Conservation Center, Japan.

Residential energy efficiency standards strengthened amid calls for energy-saving equipment

Since 2013, primary energy provisions have been included in residential energy
efficiency standards, and compliance with these standards will be compulsory from2020. As a result, dwellings that consume a large amount of primary energy will nolonger be built.
There are three methods of lowering primary energy consumption: (1) using
equipment that generates energy, such as solar power, (2) installing stronger insulation,and (3) adopting energy-saving equipment. However, solar power generation and someother methods cannot be applied to all dwellings due to a number of factors, including
location and the availability of an installation site. Although improved insulation ispotentially effective to a certain extent, it is not the optimal method of saving energy.
Ultimately, the main key to energy consideration lies in how we can improve energysaving equipment. Hot water accounts for a large percentage of primary energy
consumption in the home. Therefore, reducing energy used for heating water is central
to residential energy conservation.
For example, if conventional water heaters were replaced by Eco Jozu
systems, around 20% less energy would be used, and this figure increases to around
30% if conventional units were replaced by an ECO CUTE system. Nonetheless,efficiency is a problem when using ECO CUTE because it uses night-time electricity
to heat and maintain water at a high temperature. Another disadvantage is the uneaseconsumers feel about the possibility of running out of hot water. ECO ONE, which
combines a heat pump with Eco Jozu, capitalizes on the strong points of both electricity
and gas. Moreover, in addition to delivering energy savings of around 40% to 50%
compared with conventional systems, ECO ONE has the added benefit of reducing theamount of energy used for room heating.

Masayuki Mae, Associate
Professor, Department ofArchitecture, School ofEngineering, University of
Tokyo

32

CSR Report 2014│Environmental Initiatives

High-efficiency Eco Jozu water heaters reflect
Rinnai’s environmental commitment
Contributing to the global environmental issues through our products attracting consumers
Guided by its basic philosophy on the environment, the Rinnai Group engages in environmentally friendly activities
across all business areas to help create a sustainable society and a sustainable planet. Here, we use the example ofour high-efficiency Eco Jozu water heaters to introduce some of the special initiatives we deploy to reduce theenvironmental impact of our core business activities.

Emphasis on simplicity of individual parts leads to creation industry’s lightest
water heater*1
Customer support for our Eco Jozu offerings, with their excellent
environmental performance, is necessary for Eco Jozu’s proliferation, as issupport from salespeople and installation providers. These products represent
an amalgamation of core Rinnai technologies related to heat, including
combustion, heat exchange, electronic control, and fluid control of gas andwater. While maintaining Eco Jozu’s highest levels of thermal efficiency—95%
and 92% for water heating and bath-filling, respectively—Rinnai’s pursued thesmallest and lightest parts possible. This reduced the water heater’s weightfrom 31.0kg to 27.5kg, making it the lightest in the industry.

33

CSR Report 2014│Environmental Initiatives

Development of the new E Series of Eco Jozu offerings began with the reverification of all parts used to date, covering around 1,200 items. We thenundertook extensive reengineering of individual parts, down to the smallest
screw, while also considering ease of assembly at the time of manufacture.
Opinions from multiple departments were reflected in the final design.

Yasutaka Ueda, Team Leader,
Water Heating Appliance Design
Office, Development Headquarters

Development of the combustion element, which forms the heart of a water
heater, involved decisions on individual parts centered on the burner.
Elimination of a single burner part may reduce overall weight by 13g, but the
improvement would spread to other sections, including the combustion
chamber and heat exchanger, resulting in better design and overall benefits.
When combined, the tiniest of improvements in the environmental performanceof each individual part had an enormous effect (conservation of resources) on
the product as a whole.

Combustion burner test

Careful consideration was also given to the disposal stage of the productlifecycle. Rinnai adopted a recycling-friendly design, which included using
lighter raw materials, a structural design that makes dismantling easy, andreduction in the number of composite parts that are difficult to dismantle.
* Eco Jozu RUF-E24 (as of March 2014)

Takuji Koshiro, Team Leader,
Combustion Technology
Development Office, Development
Headquarters

Production design contributes to higher productivity andlower total energy consumption
Rinnai pursues in-house development and production to ensure that new corecomponents are manufactured using optimal processing technologies andmaintain the highest levels of quality. We adopt an integrated production(mixed flow) system that encompasses all processes, from press work toassembly and packaging. Based on the concept that any loss leads to energy
loss, we make improvements on a daily basis to minimize stoppages (losses) intransportation, manual handling, and inventory.
In production of Eco Jozu, changing the fastening method for asecondary heat exchanger (which effectively recovers heat from exhaust heat)from the conventional “welding method” to the “caulking method” has led toenhanced productivity. As a result, there has been a reduction of around 85%
in CO2 emissions generated during manufacturing.

Hidekatsu Naruse,
Production Design Section,
Product Engineering Development
Office, Production Engineering
Division

34

CSR Report 2014│Environmental Initiatives

Example of CO2 emissions reduction in the manufacturing process
CO2 emissions reduced by changing the fastening method of the secondary heat exchanger

Fastening method
Fastening energy
CO2 emissions

Before Improvement

After Improvement

Welded part

Caulked machining part

Welding
0.029kWh0.0110kg-CO2

Caulking
0.004kWh0.0015kg-CO2*CO2 Emissions per unit: minus 0.0095kg-CO2

Lighter products enhance workability (work efficiency) and reduces energy
consumption in the logistics process
Reducing the weight of a water heater by 3.5kg compared with conventional models has made it easier to wall-mountthe main body and reduce the load on external walls. A lighter product has also contributed to improved loading
efficiency during the logistics process, resulting in a 10% reduction in energy consumption.

35

CSR Report 2014│Environmental Initiatives

Marketing mission is to boost sales of environmentally responsible products
As a comprehensive manufacturer of heat-energy appliances, the Rinnai
Group’s mission is to foster the reduction of CO2 emissions generated byhouseholds using the Group’s products.
Our Eco Jozu water heaters boast high energy efficiency because theyeffectively use waste heat, which previously was allowed to dissipate, to heatwater. As residential energy efficiency standards are successively introduced,
more and more people are calling for energy-saving, eco-friendly initiatives forhomes.
From the product perspective, Rinnai evokes the image of “water
heaters” that heat the required amount of water at the required time. From theperspective of the customer who uses water heaters on a daily basis, however,Rinnai is a “faucet” rather than a water heater. To help customers understandthe excellence of Eco Jozu water heaters, therefore, we devise and promote
campaigns to publicize the properties of Rinnai products that are not outwardly
evident, such as technological capabilities, durability (long life), and reliability(quality).
At the same time, we also support the manufacture of even better
products based on feedback on issues that arise during installation, which only
those on site at customers’ places can provide.

Koichiro Miura,
Deputy General Manager,
Sales Promotion Office, Marketing &Sales Headquarters

High-efficiency Eco Jozu water heaters: Heats water while consuming minimal energy

Heat efficiency boosted from around 80% to 95%!

RUF-E2405AW Series

36CSR Report 2013│Environmental Management System

Environmental Management System
Rinnai maintains an environmental management system based on ISO 14001. We effectively utilize thismanagement system and constantly strive to promote environment management practices aimed at environmentallyconscious monozukuri and to raise environmental performance. Our goal is to contribute to the formation of asociety capable of sustainable development.

ISO 14001 Certification
To underpin the systematic and continuous development of environment-oriented
activities in line with our stated basic environmental policy, we encourage allmembers of the Rinnai Group to embrace efforts to acquire and maintain
ISO14001 certification. In fiscal 2014, we obtained ISO 14001 certification at
one site in Japan (Higashikanto Sales Office in Marketing & Sales Headquarters).
To further expand our environmental protection activities, we will continue toincorporate environmental management systems into our domestic sales
operations in the future.
Higashikanto Sales Office

Promotional Framework for Environmental Activities
Headed by the President, the Environment Management Committee guides corporate efforts to achieve targets based on
environmental policy. This committee is chaired by the executive officer responsible for the environment and has theparticipation of representatives from all divisions. Its mandate is to promote environment-oriented activities from a bigpicture view.

Environment Management Activities
The Environment Management Committee discusses and decides
important items including the basic environmental basic policy, thegoal and a medium to long-term plan. The committee thoroughly
informs individual divisions of decisions made by the committee
and promotes concrete activities in line with annual plans. We
review our objectives as necessary and diligently strive to meet ourtargets. To perform specific activities, each division has a liaisongroup and holds routine meetings to make issues known toeveryone in the respective division and continue improvement
activities.

Environmental Management Committee (left)
and a divisional liaison group37

CSR Report 2013│Environmental Management System

External and Internal Environmental Audits
The ISO 14011 Certification Division undergoes a routine audit, once a year, by an external screening/registration body toverify that the environmental management system is being properly applied. The routine audit in fiscal 2014 did not turnup any major non- conformances.

External audits

As part of internal audits, Auditing team, comprising impartial internal auditors chosen from within the Corporation who
have no direct connection to the division under audit, assess conformity to the established environmental management
system and review division activities. Auditors visit worksites of divisions tapped for an audit and perform detailed
inspections. Direct contact between auditors and divisions facilitates greater understanding of division activities and auditor
concerns. Internal audits in fiscal 2014 found no major non-conformances. There were 6 opportunities for improvement and41 observations. We swiftly addressed these areas to ensure that they would not develop into problems later on.

Internal audits

Environmental Training
Raising each employee’s environmental awareness is important for promoting environmental activities. To provide as
many employees as possible with opportunities to raise their environmental awareness, we plan and offer training
programs for developing and fostering human resources who will actually engage in environmental activities, as well as
new employee training and rank-specific training programs.
Education System
Environmental training for environmental examiner
Brushing up education for chief environmental auditor

Environmental training for Trainees from Overseas Group Companies
Biodiversity training

Environmental training for environmental internal auditor

Environmental training for new employees

Internal Auditor Training
Internal auditors play a significant role over and above their efforts tocontinuously improve the environmental management system. The execution ofaudit requires highly specialized knowledge and communication skill. To
upgrade the skills of internal auditors, we conduct regular training by in-house
instructors on such topics as laws and ordinances, internal regulations, internal
audit observations and improvement measures, and environment- oriented trends.
Internal audit workshops (in-house instructor)
38 participants
Seminars on ISO 14001 standards (external instructor)

36 participants

Seminar on ISO 14001 standards

38

CSR Report 2013│Environmental Management System

Environmental Training for Trainees from Overseas Group Companies
We provide training based on a range of manuals, covering basic subjects such as attitudes towards the environment andapproaches to environmentally friendly manufacturing. We also provide training in production methods using
environmentally friendly facilities, and on methods of improving operations based on actual examples, in an effort toimprove levels of environmental awareness throughout the Rinnai Group.

Trainees attend a lecture on our environmental
initiatives

Explanation of wastewater
treatment facilities

Trainees receive explanations on our water
recycling system

Seminar on Saving Energy and Technology for Maintenance Staff
We organized a seminar on saving energy and steam technology for facility
maintenance staff at our factories and other facilities. A total of 12 members ofstaff took part.

Seminar on saving energy andsteam technology

Training in Biodiversity and How It Relates to Rinnai
In addition to our own business activities, we also use large quantities ofresources and energy when our products are used and disposed of by ourcustomers. We have always emitted greenhouse gases such as CO2, too, andother substances that impact on the environment.
We published a series of special features on the theme of
biodiversity and how it relates to our own environmental activities in the inhouse environmental publication that we distribute regularly to employees.
The aim was to raise levels of awareness so that employees appreciate how
biodiversity affects them.
Comments in response to a reader questionnaire roughly one year
after the publication of this series included “I barely knew what the word
meant at first, but those special features gradually helped me to understandbiodiversity.” We intend to continue raising awareness like this in the future.

In-house environmental publication called“Understanding Biodiversity”

39

CSR Report 2013│Environmental Management System

Enhancing Global Environment Management:
Creating an environmental management system with our business partners
Reinforcement of Chemical Management
All over the world, governments are implementing tougher restrictions on chemicals, and manufacturers are increasingly
required to monitor their use of chemicals used during production processes and the chemical content in finishedproducts. Chemical substances are known to present certain risks, depending on the correlation between the amount of
exposure and the harm they could inflict. It is important to identify such information.
In Europe, especially, manufacturers must adhere to strict regulations, such as the Reduction of Hazardous
Substances (RoHS) Directive and Registration, Evaluation, Authorization and Restriction of Chemicals (REACH). As acollection of companies, the Rinnai Group must assume a unified approach in managing information on the chemicals
contained in its products. We must properly address laws and regulations at home and abroad and respond accurately torequests from customers on the chemicals found in our products. Chemical substances are a critical key component ofquality control. They are unseen yet require monitoring. To ensure that use of chemical substances that could harm thehuman body or the environment is minimized in the entire life cycle of products, members of the Chemical Management
Project promote activities to establish and further strengthen the platform for chemical management.
* RoHS Directive: “DIRECTIVE 2002/95/EC OF THE EUROPEAN PARLIAMENT AND Rinnai’s Procurement Management
Standards
OF THE COUNCIL of 27 January 2003 on the restriction of the use of certain hazardous
substances in electrical and electronic equipment” Since July 1, 2006, the EU market has
been restricting the use of lead, mercury, cadmium, hexavalent chromium, polybrominatedbiphenyls (PBB) and Polybrominated diphenyl ethers (PBDE) in electrical and electronicequipment.
* The Registration, Evaluation, Authorization and Restriction of Chemicals (REACH):
It is a new regulation on chemical substances in EU that mandates registration, evaluation and
E-Procurement Standard [Ver.3] (left)
authorization of chemical substances manufactured in or imported to EU.
and Policy on Chemical SubstanceManagement [Ver.3]

We establish data management systems in order to gather, register and share data relating tochemicals contained in our products, and make every effort to appropriately submit and provide
data. We are also reviewing our practices in accordance with the EU REACH Directive andvarious other regulations, and continue to provide practical training for members of staff,
including regular domestic and overseas workshops, and sharing information throughout thegroup.

Practical training(Shanghai Rinnai Co.,Ltd.)

Support to Establish Environment Management System
To promote environmentally conscious monozukuri working with our business partners, we encourage our business
partners to obtain certifications for environment management system including ISO14001, Eco Action 21 and KES.

40

CSR Report 2013│Environmental Management System[ISO 14001: 2004] Environmental management system certification acquisition status
Location

Rinnai

DomesticGroup
Company

Overseas
Group
Company

Certified year/month

Research and Development Headquarters

October 1997

Production Engineering Division

October 1997

Oguchi Factory

October 1997

Seto Factory

December 2000

Environment DivisionDecember 2000

Asahi Factory

November 2003

Quality Assurance Headquarters

November 2003

Head Office

December 2008

Kansai Branch

May 2010

Logistic Control Office

May 2010

Kanto Branch

May 2011

Chugoku sales office

May 2011

Rinnai Parts Center*May 2011

Kyushu Branch

April 2012

Hokkaido sales office

April 2012

Niigata sales office

April 2012

Tohoku Branch

May 2013

Shikoku sales office

May 2013

Higashikanto sales office

April 2014

Rinnai Technica Co., Ltd.

December 2003

Yanagisawa Manufacturing Co., Ltd.

June 2004

Rinnai Precision Co., Ltd.

December 2005

Japan Ceramics Co., Ltd.

January 2006

RT Engineering Co., Ltd.

March 2006

RB Controls Co., Ltd.

March 2006

Noto Tech Co., Ltd.

January 2007

Rinnai Korea Corporation

July1997

RB Korea Ltd.

October 2006

Shanghai Rinnai Co., Ltd.

December 2008

Rinnai Brasil Heating Technology Ltd.

June 2011

Rinnai New Zealand Ltd.

July 2013*Changed the name of Parts Center into Rinnai Parts Center, due to the realignment of domestic production basis and the transfer of Aichi
Factory to the site of the Center.

Environment Management System "Eco Action21"
Location Name
Domestic Group Company

Techno Parts Co., Ltd.

Certified year/month
August 201141

Fiscal 2014 (Year ended March 31, 2014) Environmental Action Plan and Results
This section outlines targets and results for key activities in fiscal 2014 - environmental management and the 7Es (E-Products, EProcurement, E-Factory, E-Marketing, E-Service, E-Office and E-Mind) - and assesses progress towards the relevant targets.
*Progress rating ○: Achieved △: Not achieved ×: Not implemented
Activity
Environmental management
system
E-Products
Activity

Prevent global warming

Preventing air pollution

Fiscal 2014 Targets

Obtain ISO 14001 certification at one sales Obtained ISO 14001 certification at
officeHigashikanto Sales Office
Fiscal 2014 Targets
Develop high-efficiency equipment
Reduce power consumption in standbymode
・FF heaters
Continue to develop low-NOx water
heaters
Continue to carry out product assessments(all new products)

Saving and recycling
resources

E-Procurement
Activity
Green procurement

E-Marketing, E-Service
Activity
Increasing sales of highefficiency products
Providing information on
environmentally conscious
products
E-Mind, Other
Activity

Fiscal 2014 Results

Fiscal 2014 Results
Developed high-efficiency equipment
・Eco-Jozu water heaters with bath-fillingsystems
・Eco-Jozu water heaters
Developed low-NOx water heaters
・Eco-Jozu water heaters with heating
systems
・Eco-Jozu water heaters with bath-fillingsystems
・Eco-Jozu water heaters
Carried out product assessments

Develop water-saving equipment

Developed lightweight products
・Eco-Jozu water heaters with bath-fillingsystems
Developed water-saving equipment
・Dishwashers

Fiscal 2014 Targets

Fiscal 2014 Results

Develop green products

Procured and used materials in accordancewith E-Procurement Standards

Promote resource saving throughlightweight development

Laid foundations for chemical management
Implement green procurement management
and reinforced cooperation with suppliers

Progress○

Progress△○○

Progress○

Fiscal 2014 Targets
Fiscal 2014 Results
Reduce CO2 emissions from highReduced CO2 emissions from water heaters
efficiency products by at least 52,000
when in use by customers by 55,000t/year
tons/year
Providing information on environmentally Showcased and raised awareness of products
conscious products
at domestic and overseas exhibitions・Showcase and raise awareness of products
at exhibitions
・Produce and distribute catalogs, flyers and Produce and distribute catalogs, flyers andpamphlets
pamphlets

Progress

Fiscal 2014 Targets•Publish CSR Report for fiscal 2014
• Disclose environmental information on

Progress

Fiscal 2014 Results• Published CSR Report for fiscal 2014
(October)Disclosing environmental• Disclosed environmental information on
information
website(October)• Promote educational activities in line with Provided training for internal auditors,
Environmental education andcompanywide and site-specific plans foreducation on the links between biodiversity
awarenessfiscal 2014
and business activities, etc.

○

○

○

○

42

E-Factory
Activity
Prevent global warming

Reduce waste

Reduce hazardous chemical
substances

Fiscal 2014 Targets*1
CO2 emission factor :Reduce by 4% or more compared to fiscal
2010•Maintain zero emissions:(Resource recycling rate of 99.5% orhigher)*2
Waste emission factor :Reduce by 3% or more compared to fiscal
2011*3
Water consumption factor :Reduce by 3% or more compared to fiscal
2011*4
Hazardous chemical usage factor :Reduce by 3% or more compared to fiscal
2011

Fiscal 2014 Results

Progress

Reduced by 12.8% compared to fiscal 2010○

Maintained/improved zero emissions○

Reduced by at least 18.1% compared tofiscal 2011
Reduced by at least 17.9% compared tofiscal 2011
Reduced by at least 25.8% compared tofiscal 2011○

*1: CO2 emission factor = Total CO2 emissions (tons/year) / net sales (¥100 million)*2: Waste emission factor = Total waste produced (tons) / net sales (¥100 million)*3: Water consumption factor = Total water consumed (m3/year) / net sales (¥100 million)*4: Hazardous chemical usage factor = Total PRTR hazardous chemicals used (tons/year) / net sales (¥100 million）
Hazardous chemicals = Class 1 Designated Substances as specified under the PRTR Act

E-Office
Activity

Fiscal 2014 Targets

Green purchasing

Maintain a green purchasing rate of 91% or Green purchasing rate: Achieved rate ofhigher for office supplies and equipment
92.0% or higher (Monetary basis)

Power-saving activities
Activity

Fiscal 2014 Targets

Summer power-saving targets
at domestic facilities (June- [Power saving] 1,300,000kWh
Sept)

Fiscal 2014 Results

Fiscal 2014 Results[Power saving] At least 1,350,000kWh[Power-saving items] 399*Power saving equivalent to 16.4% of power
consumption for the same period in 2010

Progress○

Progress○

43

Fiscal 2015 Environmental Action Plan
We continued to push ahead with 7E activities in fiscal 2015, in an effort to roll out our environmental management
system and improve environmental performance across all divisions and group companies.
E-Products
Activity

Preventing global warming

Preventing air pollution

Basic Action Plan

Fiscal 2015 Targets

Continue to develop industry-leading energy
Reduce power consumption insaving products, focusing on activities such as
standby modedeveloping high-efficiency equipment using
condensing technology, rolling out hybrid water
heaters with heating systems, and reducing
power consumption when equipment is in
・Eco-Jozu water heaters
standby mode or in use
Develop low-NOx products for the domestic and Develop low-NOx Eco-Jozu water
overseas markets
heaters
Conduct product assessments (allnew products)

Develop smaller, lightweight products andcomponents in order to save resources, andSaving and recycling resources
continue to develop products with an emphasis
on resource recycling

Develop lightweight products
・Tabletop cookers
・Fan heaters
・Eco-Jozu water heaters withheating systems
・Eco-Jozu water heaters

E-Procurement
Activity

Basic Action Plan

Green procurement

Work with suppliers and group companies topromote procurement of environmentallyconscious products (conserving resources, saving
・Reinforce chemical management
energy, recycling, etc.)

Fiscal 2015 Targets
Develop green products
・Promote use of materials
compliant with the E-Procurement
Standards
Implement green procurement
management
Look into measures aimed at
ascertaining suppliers' CO2
emissions44

E-Marketing, E-Service
Activity

Basic Action Plan

Fiscal 2015 Targets

Increasing sales of highefficiency products

Increase sales of high-efficiency products
Water heaters (Eco-Jozu/hybrid water heaters
with heating systems, etc.)

Reduce CO2 emissions from water
heaters when in use by customers
by 61,000 tons/year

Providing information on
environmentally conscious
products

Showcase and raise awareness ofProvide information on environmentally
products at domestic and overseas
conscious products through exhibitions, catalogs, exhibitions
flyers, pamphlets, etc.
Produce and distribute catalogs,
flyers and pamphlets

E-mindActivity

Basic Action Plan

Disclosing environmental
information
Environmental education andawareness

Fiscal 2015 Targets
Publish CSR Report for fiscal
Disclose information on environmental activities 2015
Disclose environmental
and products via CSR Report, website, etc.
information via website
Actively organize environmental education and Promote educational activities inawareness activities for employees, and continue line with companywide and siteto raise levels of environmental awarenessspecific plans

E-Factory
Activity

Basic Action Plan
CO2 emission factor*1:
Preventing global warming
Reduce by 5% or more compared to fiscal 2010
by fiscal 2105
Maintain zero emissions:(Resource recycling rate of 99.5% or higher)
Waste emission factor*2:
Reduce by 4% or more compared to fiscal 2011
Saving and recycling resourcesby fiscal 2015

Fiscal 2015 Targets
Reduce by 5% or more comparedto fiscal 2010
Maintain/improve zero emissions
Reduce by 4% or more comparedto fiscal 2011

Water consumption factor*3:
Reduce by 4% or more compared
Reduce by 4% or more compared to fiscal 2011
to fiscal 2011
by fiscal 2015
Reducing hazardous chemical
substances

Hazardous chemical usage factor*4:
Reduce by 4% or more compared
Reduce by 4% or more compared to fiscal 2011
to fiscal 2011
by fiscal 2015

*1: CO2 emission factor = Total CO2 emissions (tons/year) / net sales (¥100 million)*2: Waste emission factor = Total waste produced (tons/year) / net sales (¥100 million)*3: Water consumption factor = Total water consumed (m3/year) / net sales (¥100 million)*4: Hazardous chemical usage factor = Total PRTR hazardous chemicals used (tons/year) / net sales (¥100 million）
Hazardous chemicals = Class 1 Designated Substances as specified under the PRTR Act

E-Office
Activity
Green purchasing

Basic Action Plan
Achieve a green purchasing rate of at least 91%
by fiscal 2015
*Including newly added items

Fiscal 2015 Targets
Achieve a green purchasing rate ofat least 91%, including newly
added items

45

CSR Report 2014│Developing Environmentally Conscious Products

Developing Environmentally Conscious Products
We promote research of technologies and development of products that help our customers to lead comfortable
lifestyles based on the principles of environmentally friendly design, including preventing global warming andrecycling resources.

Energy and Resource Saving Initiatives
Water Heaters
Eco One Hybrid Water Heater with Heating Systems
Saving energy- Achieves 125% primary energy efficiency when heating water, byboiling water within the most efficient temperature range (lowtemperatures), learning daily usage patterns and supplying theideal amount of hot water with no waste- Power-saving option to stop the heat pump from running andswitch configuration to gas only at peak times- Won the fiscal 2014 Minister of Economy, Trade and Industry
Award, the highest honor in the Product/Business Model Divisionat the Energy Conservation Awards

Made in JapanECO ONE
Hybrid water heater with heating system

Remote control for added comfort and convenience- Equipped with features to enable users to effortlessly save energy, including an automatic mode that optimizes
hot water depending on usage, and an ECO notification feature to raise levels of eco awareness*Energy Conservation Awards: Scheme for companies, local authorities, educational institutions and other such organizations, designed to giverecognition to outstanding energy saving initiatives, products and business models (Total number of applications: 146)

Using ECO ONE in an Eco-Friendly Manner : Remote control settings(1) Automatic mode
By studying usage patterns, ECO ONE
can supply just the right amount of hot
water, with no waste.

(2) Energy check
ECO ONE shows how effective it is while
performing, so that you can reduce energy
consumption to just the right level.

(3) Eco notification
ECO ONE provides energy saving
advice depending on your usage.

46

CSR Report 2014│Developing Environmentally Conscious Products

What is Primary Energy Efficiency?
“Primary energy” refers to any form of energy in its naturally occurring state, including coal, oil and natural gas.
We have long since used primary energy by turning it into formats that are easier to use, such as electricity, city
gas or propane. In the case of hot-water units, electricity or gas is converted into heat energy to produce hot water.
The “primary energy efficiency of a hot-water unit” refers to the volume of hot water produced equivalent to theamount of primary energy input. In terms of saving energy, products are better if they have higher primary energy
efficiency.

Water Heaters
Heat source for gas water heaters with heating systems
Saving energy- Thermal efficiency
Water heating: 95%

Features
Equipped with three functions:
Hot water + Bath heater + Heating

Bath heating: 87%-

Standby power: 1.8W or lessMade in Japan

RUFH-EP1613AFF2-3H

Gas water heater with bath-filling system
Saving energy
Thermal efficiency
Water heating: 95%
Bath heating: 92%
Standby power: 0.9W or less
Saving resources
Approximately 3.5kg lighter (reduction of
approximately 11% compared to standard
Rinnai product)
Low NOx emissions: 60ppm or lessFeatures
Equipped with two functions:
Hot water + Bath heater
Dedicated water heater

Made in JapanRUF-E2405AW Series

47

CSR Report 2014│Developing Environmentally Conscious Products

Dedicated gas water heater (commercial)
Saving energy
Thermal efficiency: 95%
Saving resources
Approximately 6kg lighter (reduction of
approximately 9% compared to standard
Rinnai product)
Approximately 2kg less packaging(reduction of approximately 25% compared
to standard Rinnai product)

Features
Equipped with one function:
Hot water
Dedicated water heater

Made in JapanRUXC-E5000MW

Dedicated gas water heater
Saving energy
Thermal efficiency: 95%
Standby power: 1.0W or less
Saving resources
Approximately 2.5kg lighter (reduction of
approximately 9% compared to standard
Rinnai product)
Low NOx emissions: 60ppm or lessFeatures
Equipped with one function:
Hot water
Dedicated water heater

Made in JapanRUX-E2403W Series

Heaters/Clothes Dryers
Gas fan heaters
Saving energy- “Considerate Eco-Mode” prevents rooms frombecoming too hot by controlling combustion
for a set interval after reaching the target
temperature- Reduces gas consumption by up to 16%
compared to existing models, over a period of
approximately two and a half hours after
reaching the target temperature*1

Made in Japan*1: Based on comparison between the new RC-M2402E
and the existing model RC-K2402E

Fan-forced gas heater
Saving energy- Thermal efficiency: 82.2% ⇒ 82.6%- Standby power: Reduced 7W ⇒ 0.8W
- “Eco mode” to control combustion in line witha set temperature and prevent the room frombecoming too warm

Made in Japan

RHF-561FT48

CSR Report 2014│Developing Environmentally Conscious Products

Gas clothes dryer
Speedy Kanta-kun

Comfort/convenience- Gas-powered hot air has a similar antibacterial
effect to drying clothes in the sun- With no need for outside drying, users can dry
clothes inside without worrying about hay
fever, the rainy season or air pollution (PM2.5)- Gas provides powerful hot air, which makes
each and every fiber stand up for a softer finish

Made in Japan

RDT-52S (connected to gas hose), RDT-52SU (connected to tap)

Reduced noise- Designed to reduce noise to the same level as a library- *RDT-52S Series maximum operating noise: 48dB
(Reference) 50dB: Quiet office, extractor fan

Saving resources
Filter used to catch fluff and lint from clothes during drying upgraded to a filter that doesn’t need replacing

Ketchen
Front-Opening Dishwashers*1
Saving energy- Equipped with a range of washing modes and two
dedicated washing nozzle pumps above and below, tostrike a balance between cleaning performance andsaving water- Reduces water consumption by up to 53% in watersaving mode compared to existing models*3

Made in Japan*2 Developed in conjunction with TOTO Ltd.
*3 Based on comparison between the new RKW-F402C andstandard mode on the existing model

Convenience/comfort- Features dedicated sliding dishwasher racks that canalso be used as drying racks in the kitchen sink, andtwo-tiered upper and lower racks, to enable users toload dishes and cooking utensils without worrying
about the order

Jet type rotary nozzle
above and below

RKW-F402C

49

CSR Report 2014│Developing Environmentally Conscious Products

MY HOB Series of built-in gas hobs for overseas markets
Saving energy- Burners approximately 1kg lighter thanks to eco
design using lighter parts (reduction of
approximately 74% compared to standard Rinnai
product)-

Unit specifications to enable optimization ofdifferent burner numbers and layouts, helping to
reduce energy consumption during processing at the
manufacturing stages and the amount of steel used
(reduction of approximately 24t)

Made in Japan

RB-3311N-GBS

RB-3312S-GBS

RB-7312N-GBS(30cm, 1-burner model)(30cm, 2-burner model)(77cm, 2-burner model)

RB-6323S-GBST

RB-6314S-GBS(60 cm, 3-burner model)(60 cm, 4-burner model)

RB-9314S-GBS

RB-6315S-GBS(90 cm, 4-burner model)(90 cm, 5-burner model)

50

CSR Report 2014│Developing Environmentally Conscious Products

Packing
We promote packages which only use corrugated board to reduce the use of styrene foam and waste-related
issues. In addition, we are also expanding our use of returnable packing to reuse packing materials and reduce
the amount of packing used.

Gas Built-in Hob Wins Prize in the Electric Equipment Packaging Category at
the 2013 Japan Packaging Contest
We have reconfigured the “top tray” to enable packaging toaccommodate products with different specifications, in terms of thenumber and layout of burners (two-burner hobs, three-burner hobs,etc.), and have reduced the amount of cardboard we use in theprocess. Reducing the number (types) of packaging materials that we
use has also enabled us to improve workability.
・Reduction in
cardboard

90g/unit

Reduction of approximately 1.7%
compared to standard Rinnai product)

Electric Equipment Packaging Category Award*3: If switching from standard specifications to dedicated specificationsfor 3-burner hob

Standardized packaging specifications for gas
built-in hobs for fitted kitchens

Returnable packaging
We use returnable packaging for selected water heaters. Integrating external packaging and padding material has
reduced the number of parts and reduced the overall mass by approximately 50%.
・Reduction in packaging materials

2.5kg/unit (reduction of approximately 50% compared to standard Rinnai product)51

CSR Report 2014│Developing Environmentally Conscious Products

Styrene Foam Use Trend (Volume)

Recycling
Product Recycling Initiatives
In an effort to increase our recycling rate, we engage in environmentally conscious design in accordance with ourown in-house product assessment regulations, including initiatives such as structural design to make products easier
to dismantle.

Examples of environmentally conscious design-

Reducing raw materials
Selecting materials that are easy to recycle
Structural design to make products easier to dismantle
Using fewer composite parts that are hard to dismantle

Recycle Household Electrical Appliances
Japan’s Home Appliance Recycling Law went into effect April 2001 with the goals to reduce the amount of waste
going to landfills and incinerators and to promote more effective use of resources. Since then, appliances that
consumers no longer want to use have been recycled into new products. Rinnai now has two products-a unit-style
air-conditioner and a clothes dryer-that can be redirected from the waste pile.

Recycle Containers and Packaging
The Containers and Packaging Recycling Law obligates manufacturers and user businesses to recycle productcontainers and packaging discarded by households in an effort to make more effective use of resources. In
accordance with the law, Rinnai has contracted a designated corporation that recycles containers and packaging on
the Corporation's behalf.

52

CSR Report 2014│Environment-Conscious Monozukuri

Environmentally Conscious Monozukuri
Since its establishment, Rinnai has been accumulating its outstanding monozukuri technology and work
methodology. By sharing and passing on this culture over generations, we have been realizing a wide range oftechnological innovation, to achieve the highest levels of environmental efficiency, and to actively engage inenvironmentally friendly business activities.

Environmental Footprint in Monozukuri
We make every effort to quantify the Rinnai Group’s environmental impact, as the first step in our environmental
activities. Based on a clear awareness of our overall environmental impact, we are constantly thinking about what
we as a group can do for the global environment and working to reduce environmental impact.

-

As we have been unable to gather sufficient performance data for some of our overseas facilities to date, we are planning to
restructure our global information gathering framework, so that we can utilize information currently at our disposal to reduce
environmental impact in the future. Input/output data does not include environmental impact at the logistics/sales, usage,
procurement or disposal stages.

-

CO2 conversion factors used to calculate CO2 emissions are based on Ministry of the Environment guidelines for the calculationof greenhouse gas emissions by business operators (July 2003). Figures for natural gas (13A) and methane however are based on
those provided by the relevant supplier.

-Heat conversion factors are calculated based on standard heat values according to energy source, published by the Agency for
Natural Resources and Energy (February 2002). Figures for natural gas (13A) and methane however are based on those provided
by the relevant supplier. The figure used for electricity is 9.84MJ/KWh.

53

CSR Report 2014│Environment-Conscious Monozukuri

CO2 conversion factors (kg CO2/unit)
Electricity

Gas

Oil

0.378

kg-CO2/kWh

13A

2.197

kg-CO2/m3

LPG

3.000

kg-CO2/kg

Butane3.000

kg-CO2/kg

Methane2.020

kg-CO2/m3

Heavy oil

2.710

kg-CO2/L

Kerosene

2.489

kg-CO2/L

Light oil

2.619

kg-CO2/L

Gasoline

2.322

kg-CO2/L

9.84

MJ/kWh

13A

46.10

MJ/m2

LPG

50.20

MJ/kg

Butane

50.20

MJ/kg

Methane

40.90

MJ/m2

Heavy oil

39.10

MJ/L

Kerosene

36.70

MJ/L

Light oil

38.20

MJ/L

Gasoline

34.60

MJ/L

Heat conversion factors (MJ/unit)
Electricity

Gas

Oil

54

CSR Report 2014│Environment-Conscious Monozukuri

Pursuing Monozukuri Innovation
We are committed to preserving and sharing our outstanding monozukuri (manufacturing) capabilities, including
the monozukuri technologies we have built up since the company was established and our practical methods ofworking. As well as harnessing a range of innovative technologies to reduce environmental impact, we strive toachieve industry-leading standards of environmental efficiency and promote environmentally conscious initiatives.

【Example】Devising Environmentally Friendly Screws (Seto Factory)
Having taken a closer look at the tens of thousands of tiny screws we use at thefactory every day, we worked with suppliers to devise screw specifications tosuit heat-energy appliances. We started by examining the properties andqualities of each individual component. Through measures such as revising
effective screw length, we managed to improve performance and reduce theweight of each screw. This in turn has helped to reduce time spent inserting
screws and improved productivity (by reducing energy consumption). We havealso revised our existing packing methods to make products easier to insert andremove. As well as reducing packaging materials, this has made it easier to sortand ship screws.
-

Inserting screws

Reduction in raw materials: Approx. 2t per year
Reduction in power consumption: Approx. 5,300kWh per year
Reduction in CO2 emissions: Approx. 2t CO2 per year
Reduction in packaging: Approx. 2t per year

Revising packing methods

55

CSR Report 2014│Environment-Conscious Monozukuri

Efforts to Prevent Global Warming
Promoting energy saving measures at domestic facilities
As a designated operator under the Revised Act on the Rational Use of Energy (Energy Conservation Act), we haveset out energy management policies and targets, and make every effort to improve energy efficiency. Following on
from last year, we implemented power-saving activities designed to reduce power consumption during the summer
months at all facilities, and have also been promoting activities aimed at stepping up operational management inindividual workplaces, in areas such as lighting and air conditioning. As a result, we were able to save a total of
1,350,000 kWh of power during the summer* of fiscal 2014 (399 power-saving items). The amount of power saved
was equivalent to 16.4% of power consumption for the same period in 2010.
*Summer: June to September

Energy Saving Initiatives
Upgrades/new
installations (investments)

Upgrading to high-efficiency lighting and air conditioning systems, upgrading tohigh-efficiency vending machines, etc.

Optimization(administration)

Reducing lighting, controlling temperature and limiting usage of air conditioning,
introducing a voluntary ban on using elevators, configuring office equipment to turnoff or switch to standby mode if left unused for prolonged periods, reducing usage ofphotocopiers (double-sided printing, using condensed printing settings), reducing
usage of drinks machines, etc.

Optimization(manufacturing)

Optimizing set pressure and start/stop times on compressors, improving furnace
efficiency in order to reduce operating times, reusing exhaust heat from boilers, etc.

OthersIntroducing early-morning overtime scheme and reducing late-night overtime (noneed for air conditioning in early morning), issuing peak alerts via power monitoring
system, bringing forward and extending “Cool Biz” operations, eliminating air leaks,
organizing “waste patrols” led by female employees, using green curtains andbamboo screens to reduce strain on air conditioning, etc.

Upgrading to high-efficiency lamps(Production and Technology Development
Center)Peak power measures: Issuing peak alerts when power
consumption exceeds upper limits (Production andTechnology Development Center)

Steam training seminar“Green curtain” made from cherry tomato
plants (Japan Ceramics Co., Ltd.)

Environmental patrols toeliminate air leaks(Yanagisawa Manufacturing Co., Ltd.)

Using automatic computer shutdown
functions to save wasted electricity(Hokkaido Sales Office)56

CSR Report 2014│Environment-Conscious Monozukuri【Example 1】
Environmental improvements to enameled metalware firing furnaces (Oguchi Factory)
Enameled metalware firing furnaces heat a number of tube burners to approximately 1,200˚C and the transfer the
resulting heat to the inside of the furnace. By reducing the thickness of tube burners and increasing transfer
efficiency, we have shortened the time taken to reach set temperatures inside our furnaces by transferring heatmore efficiently. We have also significantly reduced the amount of fuel required to maintain furnace
temperatures.
Reduction in gas consumption: Approx. 11,400m3 per year
Reduction in CO2 emissions: Approx. 25t CO2 per year

Maintenance work

Inside a firing furnace

Promoting energy saving measures at overseas facilities【Example 2】 Rinnai Korea Corporation
The company installed heating boilers dedicated to the rinse water at
preprocessing washing process. The new boiler system eliminated the heat loss
which was generated by the conventional system using the central boilers, andreduced gas consumption.
-

Reduction in gas consumption: Approx. 33,000m3 per year
Reduction in CO2 emissions: Approx. 65t CO2 per year
Industrial boiler for the rinse water【Example 3】 Rinnai Brasil Heating Technology Ltd.
We use large quantities of energy on testing performance when developing water heaters. For the energy saving,
it is indispensable to execute measures, which make more effective use of energy at the test without influencing
testing performance.
As part of work to extend changing rooms, we installed a hot water recycling system that enables us toeffectively reuse heat energy (hot water) from water heater durability tests as a source of heat for showers in thechanging rooms. Despite increasing the number of showers, we have significantly reduced overall energy
consumption.
Reduction in power consumption: Approx. 30,000kWh per year
Reduction in gas consumption: Approx. 3,000m3 per year
Reduction in CO2 emissions: Approx. 18t CO2 per year

Showers in the new changing rooms

Rinnai Brasil Heating Technology Ltd.

Water heater, REU-1602FEH

57

CSR Report 2014│Environment-Conscious Monozukuri

Improving Logistics
Responding to new requirements associated with the amended energy conservation law, Rinnai has promoted
improvements based on a rationalization plan for energy used in logistics activities that was formulated from theperspective of an owner of goods. We properly monitor the status of energy used in procurement and productshipment activities, and work with our logistics partners to reduce the amount of energy consumed reviewing ouroperations from various viewpoints and ideas such as the loading efficiency.

Major Activities
・Review of product delivery routes
・Effective use of round-trip transportation services
・Expansion of consolidated transport between groups
・Increasing the number of stacks per palette【Example】
Reducing the number of transportation services through the consolidation of warehouse
The Company consolidated two warehouses of components into the Rinnai
Parts Center, which leads to reduce the number of transportation for the partsprocurement, and CO2 emissions.
-

Reduction in CO2 emissions: Approx. 20t CO2 per year
Rinnai Parts Center

Efforts to Reduce Waste
We make every effort to reduce waste generated as a result of our business activities (including recycling waste
into usable resources).

Reduced Waste Output and Zero Emissions
We strive to maintain zero emissions*1 and reduce waste output.
*1 Definition of zero emissions: More than 99.5% of waste is recycled (including heat recovery)

Efforts to Curb Generation of Waste [waste reduction activities]- Don’t buy something that will end up as garbage: abolition of the excessive packing in cooperation with clients- Return reusable items to respective point of purchase: usage of returnable materials for transportation incooperation with clients- Reuse: improvement of reuse ratio of residual chemicals- Don’t make waste: improvement of available percentage of materials- Recycle/ reduce volume: improvement of fractionation method, transaction with superior waste disposers

Improving the quality of recycling
We have reviewed methods of separating waste and other such practices in order to make more effective use ofwaste resources, by reusing fuel for instance, and are constantly working to improve the quality of recycling,from thermal energy through to materials.

58

CSR Report 2014│Environment-Conscious Monozukuri

Initiatives at Domestic Facilities【Example 1】 Nagoya Industries Promotion Corporation Chairman’s Awardat the Resource Recycling Manufacturing Symposium*2
We were presented with the Nagoya Industries Promotion Corporation Chairman’s
Award at the 18th IMS Resource Recycling Manufacturing Symposium (2013),
organized by the City of Nagoya and the Nagoya Chamber of Commerce andIndustry amongst others. The award was in recognition of our efforts to revise
packing and production process in order to minimize losses in transit and reduce
waste, in conjunction with suppliers.
(*2) IMS Resource Recycling Manufacturing Symposium: Event intended to showcase research aimed at
recycling resources, reducing environmental impact and minimizing global warming from the standpoint of
manufacturing, recognize outstanding achievements, focusing particularly on companies in the Chubu region

The award ceremony(Nagoya Municipal Industrial
Research Institute)【Example 2】 Effectively Reusing Cut-out Materials (Oguchi Factory)
We effectively reuse leftover materials from pressing (cut-out materials) as part of other processes.
- Reduction in waste: Approx. 3 tons/year【Example 3】 Efforts to reduce cardboard usage (RB Controls Co., Ltd.)
Simplifying the dividing materials we use to hold products in place has enabled us to dispense with cardboard
padding inserted into the top of boxes, thereby reducing the amount of cardboard that we use. This has also
helped to raise environmental awareness with regard to packaging design.
- Reduction in cardboard: 160g per unit (reduction of 47% compared to existing products)

Industrial Waste Disposal
We rigorously screen waste disposal contractors before signing contracts,
including checking business conditions and making onsite visits. To ensure thatwaste is being disposed of properly, we send representatives to visit contractors
every year, to carry out visual confirmation and exchange information on matterssuch as types of waste, waste manifest management for disposal methods andconditions, and standards of waste disposal. In fiscal 2014, we confirmed that 55
contractors were conducting waste management in an appropriate manner.
Visiting disposal sites

59

CSR Report 2014│Environment-Conscious Monozukuri

Polychlorinated Biphenyl Waste Management
Polychlorinated biphenyls (PCB) are used for purposes such as insulating oils and are subject to the Act on Special
Measures concerning Promotion of Proper Treatment of PBC Wastes, which requires companies to reinforce storage
and safely dispose of PCB by the end of March 2027. Although we are continuing with measures aimed at disposingof PCB as soon as possible, in the meantime, we are taking steps to prevent leaks in the event of equipment failure
during storage, keeping PCB under lock-and-key to prevent loss or damage, and monitoring equipment using
nameplates, until disposal of PCB can be completed.
We are also taking measures to ensure that scrap appliances found to contain trace elements of PCB are
adequately stored and appropriately disposed of at facilities certified by the Minister for the Environment fromfiscal 2011 onwards.

Chemical Substances
Failure to conduct proper management of certain chemical substances could lead to environmental pollution.
Accumulation of such substances over a long period may also affect the health of people and the ecosystem. To
minimize the impact of such substances on the environment, we take measures for reducing or eliminating use ofharmful chemical substances in our production processes, such as reviews of materials containing certain
substances and improvement of processing facilities.

Management of usage amount of chemical substances
At each production site, we check and manage the amounts handled, released, and transferred of the 462 Class 1
chemical substances designated under the PRTR law, for which 500 kg or more is handled each year.

【Example】Revising coating components to reduce environmental impact (Asahi Factory)
As part of the process of manufacturing fan heaters, we investigated potential improvements to coatings, whichhave a significant impact on the environment, from the point of view of quality, coloring, coatability and cost.
This enabled us to revise the components that make up our coatings and reduce the amount of hazardous
chemical substances that we use.
- Reduction in hazardous chemical substances: Approx. 6t per year

Colors with varying amounts of coating

SRC-362E fan heater

60

CSR Report 2014│Environment-Conscious Monozukuri

Efforts to Prevent Pollution
Preparing for Emergencies
All offices run annual drills premised on adverse events, such as environmental accidents. To minimize
environmental risk, we have also reviewed procedures setting out actions to take in the event of a crisis and have
prepared emergency provisions.

Emergency response drill

Environment-Focused Equipment Inspection
To prevent accidents that would impact the environment, we identify
equipment with the potential to adversely affect the environment andrun concerted environment-focused inspections on these pieces ofequipment on an annual basis. We make every effort to preempt andprevent serious accidents that could impact on the environment,
through measures such as inspecting individual items of equipment,
checking that measuring instruments are functioning correctly, andrunning emergency simulations.

Equipment inspection

Consideration for Water
Recognizing water as our valuable resource, we strive to reduce the consumption of both clean water and well
water. We also manage the water we discharge to ensure that it will not have an impact on the environment.

Initiatives at Domestic Facilities[Example 1] Saving resources as part of coating processes (Yanagisawa Manufacturing Co., Ltd.)
Thanks to environmental conservation activities as part of factory coatingprocesses, we are now saving a considerable amount of water and have reduced thevolume of chemicals used in wastewater treatment.
Changed water supply method for factory pre-coating treatment processes
Installed filtration system to recycle virtually all chemical solutions in-tank
Regular checks for leaks from pumps and other equipment, and in-house repairs- Reduction in water consumption: Approx. 7,000m3 per year
- Reduction in waste: Approx. 20t per year

Pre-coating treatment(filtration system)

61

CSR Report 2014│Environment-Conscious Monozukuri

Initiatives at Overseas Facilities[Example 2] Initiatives at Shanghai Rinnai Co., Ltd.
We have established a water recirculation system for hot water supply testing, using an onsite reservoir that waspreviously unused. The system is designed so that used water is stored temporarily in the reservoir (storagetank), before being passed through a chiller, filtration and ultraviolet sterilization. The water is then sent backvia a recirculation pump, to be reused as test water.
- Reduction in water consumption: Approx. 19,000m3 per year

Making effective use of the reservoir

Chiller (cooling tower)

Filtration system[Example 3] Initiatives at Rinnai Taiwan Corporation
We have managed to save water by removing and reusing contaminants containedin test water used on assembly lines.
- Reduction in water consumption: Approx. 4,000m3 per year

Contaminant removal system[Example 4] Initiatives at Rinnai Korea Corporation.
We have established facilities to reuse wastewater and are working to make more effective use of water at
Rinnai Korea.
- Reduction in water consumption: Approx. 8,500m3 per year

Wastewater (boiler test water)

Filtration/storage(tank and transfer pump)

Reusing water(pre-treatment washing process)62

CSR Report 2014│Environment-Conscious Monozukuri

Protecting Biodiversity
As one of the cornerstones of sustainability, protecting biodiversity is one of humanity’s most urgent priorities.
The natural environment and ecosystems are susceptible to impact as a result of the location of our facilities, theprocurement of resources for our business activities, and the emission of environmentally hazardous substances
into the atmosphere, soil and water. As a company, we recognize that our business activities are inextricably
linked to biodiversity, and that we need to think about ways to sustainably access the benefits that ecosystems
provide.
We organize internal seminars to raise employee awareness of the relationship between our business activities andbiodiversity. We also promote activities that help to preserve biodiversity, by reducing environmental impact for
instance.

63

CSR Report 2014│Environment-Conscious Monozukuri

Status of Legal Compliance
Naturally, we comply with laws and regulations, but we seek to do better than the minimum required and have set
our own benchmarks as targets to achieve. We also perform checks, mainly daily monitoring, routine evaluations
and environmental audits, and strive to reduce the release of hazardous chemicals and other pollutants into the airand local water systems. We reinforce equipment operation and maintenance practices and take preemptive action
if facility status looks as though it may exceed the level we deem permissible. If we can meet our own toughstandards, we will surely meet the levels required by government.

From the left, measurement of soot and smoke, water quality, and odor measurement

Environmental Rounds of Production Sites
We routinely perform environmental audits of production sites of domestic Group companies through site visits.
Audits include confirmation of management status of facilities, waste, hazardous substances, and other aspects,
and status of compliance with laws and regulations. We also check activities for reducing environmental burden
and provide instructions and support as necessary, in an effort to standardize and improve environmental
protection efforts at each production site.

Verifying checklists during a visit

Status of Compliance with Laws and Regulations
There were no violations of pollution control or other environmental legislation in fiscal 2014.

64

CSR Report 2014│Environmental Accounting

Environmental Accounting
To realize continuous growth while promoting environmental management, we must accurately quantify thecost of environmental protection and the results achieved. We must also ensure that our approaches are
effective through appropriate allocation of management resources. We utilize guidelines set by Japan’s
Ministry of the Environment as the tools in executing these tasks.
Scope of accounting: Rinnai Corporation
Period of accounting: April 1, 2013 to March 31, 2014

Cost of Environmental Protection(Unit: Ten thousand yen)
Breakdown of Costs forEnvironmental Protection

Key Activities

Costs

Pollution
prevention

Mainly efforts to prevent air and water pollution

2,511

Environmental
protection

Mainly efforts to save energy

2,569

Resource
recycling

Recycling as well as treatment and disposal of industrial waste

2,850

Upstream/downstream

Collection/recycling and volume/weight reduction of materials
such as product packaging

1,309Management activities

Mainly monitoring and surveillance of environmental impact

9,236

Research and development

R&D on environmentally conscious products addressing
energy- and resource-saving features and reduction and/or
elimination of hazardous chemical substances

135,358

Community efforts

Mainly community activities and beautification/greening at
places of business and surrounding areas

199

In the scope ofoperations

Total

Item
On-site results
Environmental
Protection
EffectUpstream/downstr
eam results

Environmental
impact reduction
through use of
products

154,032

Content(Unit: Ten thousand yen)
Environmental Impact
Reduction

Saving energy
reduced greenhousegases

218 t CO2/year

Reduction of NOx
with products with
low NOx emissions

113 t/year

High-efficiency
products reduced CO2

80,995 t CO2/year65

CSR Report 2014│Environmental Accounting(Unit: Ten thousand yen)
Economic Effects
Accompanying
Environmental Protection
Measures

Item
Costs cut through energy-savings and waste reduction

Economic Effect526

About Environmental Protection Costs• R&D costs are associated with the development of environment-related, leading-edge technologies and products
for the heat-energy appliance market as well as products that, based on Rinnai’s standards, mark an
improvement over existing products.
• Costs covering other applications, which include non-environment-oriented activities, are apportioned according
to internal rules.
• The calculations above exclude depreciation and amortization expense.

About Success of Environmental Protection Efforts• The success of environmental protection efforts through energy-saving efforts and waste reduction is not a change
in overall volume but rather the assumed effect achieved through associated activities.
• The success of environmental protection efforts through the use of products with the capacity to reduce
environmental impact is not an industry result but rather a year-on-year comparison based on Rinnai’s sales ofsuch products. We determined these estimates based on annual volume over normal usage.

Economic Effect• The economic effects achieved through energy-savings and waste reduction are not increases or decreases inoverall costs but rather an effective amount regarded for its economic benefit through the associated activities.
• Deemed effects, such as avoiding risks and enhanced product sales, fall outside the scope of economic effects
because the standard for evaluation is too vague.
• External economic effects, derived mainly through products that reduce environmental impact, also fall outside
the scope of economic effects because the results are too difficult to pinpoint.

66

CSR Report 2014│Environmental Education and Promotion of Awareness

Environment Education and Promotion of Awareness
Activities during Environment MonthWe set every June as “Environment Month” to increase awareness of the environment for each employee andimplement and enhance various environmental protection and conservation activities at the factories and offices.

Rinnai Group Environment Awards Programs
Seeking to invigorate employees’ environmental activities and promote access to excellent approaches within theGroup, we established “Environment Awards Programs,” effective from fiscal 2011. These awards programs
recognize activities undertaken by domestic companies under the Rinnai umbrella to protect the environment andconserve resources over a one year period. The fourth award ceremony took place as part of our “Company-wide
QC Circle Competition.” 68 activities were entered for awards in fiscal 2014, sorted into categories including
manufacturing, management, sales and social contribution. Awards were then given to the best examples.

Award ceremony (left), and panel display showing outstanding achievements

Rinnai Group Environmental Grand Prize Results for Fiscal 2014
Main Awards

Recipient

Aim of Activities

Manufacturing (saving energy)
Environmental Grand
Prize

Seto Factory, Rinnai Corporation

Reducing air leaks from in-house air flow
metersAward for Outstanding
Environmental
Achievement

Production Engineering Division,
Rinnai Corporation

Reducing losses from alterations during the die
manufacturing process

Environmental Award

Seto Factory, Rinnai Corporation

Reducing energy consumption by reducing air
blowing times

Manufacturing (saving and recycling resources, and reducing hazardous chemical substances)Environmental Grand
Prize

Seto Factory, Rinnai Corporation

Reducing waste by reviewing packaging
production processes

Award for Outstanding
Environmental
Achievement

Production Engineering Division,
Rinnai Corporation

Working on paint-free processes for metallic
resins67

CSR Report 2014│Environmental Education and Promotion of AwarenessRB Controls Co., Ltd.

Developing a water recycling system fortesting showers

Award for Outstanding
Environmental
Achievement

RB Controls Co., Ltd.

Developing wall-mounted LED lighting forbathrooms

Award for Outstanding
Environmental
Achievement

Research & Development
Headquarters, Rinnai Corporation

Developing a bathroom heater/dryer with eco
drying mode

Environmental Grand
Prize

Marketing & Sales Headquarters,
Rinnai Corporation

Developing ECO ONE “meister stores”

Award for Outstanding
Environmental
Achievement

Administration Headquarters,
Rinnai Corporation

Installing LED lighting

Environmental Award

Hokkaido Sales Office, Marketing& Sales Headquarters, Rinnai
Corporation

Working to reduce electricity consumption incold areas

Environmental GrandPrize

Rinnai Brasil Heating Technology
Ltd.

Using recycled insulating materials for solar
panelsAward for Outstanding
Environmental
Achievement

Shanghai Rinnai Co., Ltd.

Discontinuing use of steam (energy)

Environmental Award

Rinnai Korea Corporation

Implementing power saving initiatives

Award for Outstanding
Environmental
Achievement

Oguchi Factory, Rinnai
Corporation

Planting trees on the island of Negros(Philippines)

Award for Outstanding
Environmental
Achievement

Kansai Branch, Marketing &Sales Headquarters, Rinnai
Corporation

Cleanup activities while climbing Mount Fuji

Environmental Award
Product development

Management and sales

Overseas

Outside activities

Other Factory Visit
We visit other companies’ factories
to learn about their advanced
environment-conscious measures.

Presentation (left) and group photo with participants

68

CSR Report 2014│Environmental Education and Promotion of Awareness

Safe, Eco Friendly Driving Initiatives
We have introduced a system to enable quantification and integrated
management of driving performance at all sales facilities, and areworking to make all of our employees more aware of safe, eco friendly
driving practices. The system is designed so that an email is
automatically sent to the relevant manager whenever an employee drives
too fast, accelerates rapidly or brakes suddenly. Compared to previously,
this reduced CO2 emissions by approximately 5% year-on-year in fiscal
2014. As well as improving fuel efficiency, the system is helping to
reduce traffic accidents and violations on public roads. We intend to rollout similar initiatives companywide in the future.

Company vehicles (Chubu Branch)

Driving Seminars
We brought in an outside instructor to give a “Safe and Eco Friendly Driving Seminar”. Designed to help prevent
traffic accidents and reduce global warming, the seminar was aimed primarily at employees in sales andmanagement divisions who use company vehicles. A total of 32 employees attended the seminar, which included
guidance and explanations on matters such as basic traffic safety and practical techniques for eco friendly
driving.

Safe and Eco-Friendly Drive Seminar (left) and “idling stop” display at Chugoku Sales OfficeEncouraging Eco Friendly Commuting
We designate “No Car Days” at our Technology Development Centerand encourage employees to commute in an eco friendly manner, in aneffort to reduce CO2 emissions and noise from commuting by car, and tominimize the effects of traffic jams. As well as reducing environmental
impact, steps such as commuting by public transport or bicycle insteadof by car, or car pooling with colleagues, also help to keep employees
healthy by providing moderate exercise.
-

Reduction in CO2 emissions: Approx. 1t CO2/year
Bicycle parking area at the Technology
Development Center

69

CSR Report 2014│Environmental Education and Promotion of Awareness

Fully Inclusive Environmental Activities
Issuing Environment Cards
We issue all employees with an “Environment Card” that lists selected environmental policies, to encouragethem to act in a more environmentally conscious manner on a day-to-day basis. Employees fill in “My
Environment Challenge Declaration” on the reverse side of their card, to raise levels of environmental awarenessin the workplace and at home too. Individual facilities also implement a range of innovative schemes to raiseawareness of the environment and related costs, including issuing cards that outline environmental costs at a
glance.

Environment Card

Employees carry their Environment
Card at all times

Cards outlining environmental costs

Issuance of Environment Company NewsWe periodically issue “Environment Company News” to share internal
environmental measures and introduce domestic and international trends
on environment activities. This is to promote the communication among
employees and encourage them to be more environment-conscious.

“Environment Company News” on theinhouse board

Green purchasing
For the purchase of office supplies and office automation equipment, we encourage employees to give priority topurchasing environment-friendly products that are qualified under the Law Concerning the Promotion of
Procurement of Eco-Friendly Goods and Services by the State and Other Entities.
* “Green procurement” and “Green purchasing”: “Green procurement” is to acquire goods directly related to our production activity,and “Green purchasing” means purchase of office-related supplies and facilities.

70

CSR Report 2014┃Chronology of Environmental Activities at Rinnai

Chronology of Environmental Activities at Rinnai
March

1993

December

1994

July

1996

March
March
June

1997

October
December
April

1998

September
October
April

1999

July
September
October
February

2000

May
August2001

January
June
June

2003
2004
2005

October
October
June
September

2006

October
September

2008

2009

Drafted Environmental Preservation Action Plan; established Environment Committee
Won prize at 4th Energy Conservation Vanguard 21 for gas-blast type high heat griller
RGM-4, 6, 8.
Market debut: low-NOx burner built-in water heater (NOx at less than 60ppm)
Won top prize at 1st Eco-Design Awards, sponsored by Tokyo Gas, Osaka Gas and Toho
Gas for water heater, fan heater and small hot-water heater.
Won special prize at 2nd Eco Design Awards for tabletop cooking stove.
Market debut: absorption-type gas air-conditioner (non-CFC)
Oguchi site acquired ISO 14001 certification covering factory, Production Engineering
Division and Research & Development Headquarters.
Won prize at 8th Energy Conservation Vanguard 21 for tabletop oven RSBN-096.
Won grand prize for gas clothes dryer and special awards for small hot-water heater andfor absorption-type gas air-condition at 3rd Eco-Design Awards.
Market debut: fan heater with air-purifier that traps dust and removes odors.
Market debut: Yukko V Series, featuring no styrene packing, low stand-by power
consumption and low NOx emissions.
Oguchi Factory (approved facility under revised Energy Conservation Law) registered as
type 2 designated energy management factory.
Established Environment Division.
Market debut: Ecomax burner and Eco burner-equipped gas cooking stove.
Market debut: condensing water heater boasting 95% heat efficiency and NOx emissions
under 30ppm.
Won Minister of Economy, Trade and Industry award for condensing water heater atministry's 10th Energy Conservation Awards.
Drafted Rinnai Environmental Action Principles.
Published inaugural issue of Environmental Report.
Won Chunichi Newspaper Prize portion of Chunichi Industrial Technology Awards forcondensing water heater.
Won Technology Grand Award from Japan Gas Association for condensing water heater.
Won Technology Award from Japan Gas Association for condensing water heater.
Won Electric Equipment Packaging Category Award in Good Packaging division at 2003
Japan Packaging Contest for built-in 75cm-wide glass-top gas cooking stove.
Won Logistics Prize at Japan Packaging Contest 2004 for bathroom heater/dryer.
Won Technology Grand Award from Japan Gas Association for development of latent heatrecovery high-efficiency hot water/heating unit.
Got involved in Team Minus 6%, a national movement to prevent global warming.
Won Electric Equipment Packaging Category Award in Good Packaging division at Japan
Packaging Contest 2006 for gas fan heater.
Gas tankless water heater sold in the United States captured 2008
Super Nova Star Award (Stars of Energy Efficiency) in the United States from the Alliance
to Save Energy.

October

Won Electric Equipment Packaging Category Award in Good Packaging division at Japan
Packaging Contest 2008 for gas fan heater.

February

Market debut: Eco-Jozu condensing hot-water/heating unit RVD-E Series.

71

CSR Report 2014┃Chronology of Environmental Activities at Rinnai

January2010

February
April
DecemberJanuary
April

2011

May
June
April
June

2012
September
October

2013

June

January

2014
June

Market debut: Eco-Jozu condensing combi boiler RUF-E Series boasting bathwater heating
efficiency rate of 92%.
Won silver at Aichi Environment Awards, sponsored by Aichi Prefecture, for global
promotion of high-efficiency combustion appliances and systems, including latent heatrecovery water heaters.
Market debut: Eco One hybrid water heater with heating systems.
Market debut: light-weight and compact Eco-Jozu water heater "RUX-E Series" (Water
heater exclusive use).
Market debut: Eco-Jozu hot-water/heating unit RUFH-E2402 Series.
Market debut: Eco One hybrid water heater with heating systems for colder regions.
Won Technology Grand Award from Japan Gas Association for development of gas hotwater system SOLAMO to use solar heat.
Won Aichi Invention Award, sponsored from Aichi Invention Association, fordevelopment of low-NOx burners for household gas water heaters.
Market debut: new Eco One hybrid water heater with heating systems which contributes toenergy saving at home (achieved 125% primary energy efficiency of a water heater)
Won Technology Award from Japan Gas Association for “kaecco” Eco-Jozu combi boiler
designed for existing apartments (put in existing PS).
Won Aichi Invention Encouragement Award, sponsored from Aichi Invention Association,
for A-Style Gas fan heaters.
Market debut: Eco One hybrid water heater with heating systems for Honshu colder
regions.
Market debut: Eco One hybrid water heater with heating systems for Hokkaido region.
Won Large and Heavy Good Packaging Prize of Japan Packaging Contest 2012 for Eco
One hybrid water heater with heating systems.
Won Technology Award from Japan Gas Association for “Jikabi-No-Takumi” new gas ricecooker, and new Delicia built-in stove.
Won Aichi Invention Encouragement Award, from Aichi Invention Association, for
Dishwasher with baking soda wash mode.
Won top energy conservation award, METI Award, in the fiscal 2013 Energy Conservation
Awards, for Eco One hybrid water heater with heating systems.
Won Aichi Invention Award, sponsored from Aichi Invention Association, fordevelopment of fire power adjustments for gas stoves.
Won Technology Grand Award for Jikabi-No-Takumi gas rice cooker, and won
Technology Award for Speedy Kanta-Kun gas cloth dryer from Japan Gas Association.

72

CSR Report 2014│Initiatives Delivering Safety and Peace of Mind

Initiatives Delivering Safety and Peace of Mind
Products that realize safe lifestyles by reducing fires
and bathroom accidents in the home
Even in the home, there are times when kitchen fires, bathroom deaths, and other types of accidents occur.
As a Group that manufactures and sells residential heat and energy appliances, we pursue product safety as a matterof paramount importance. We strive to reduce fires and deaths through a variety of measures. These include promoting
the proliferation of safe tabletop stoves fitted with sensors and bathroom heaters that prevent heat shock, as well as
accident prevention education activities.

Tabletop with Si temperature sensors prevent fires
Tabletop gas stoves are the source of most fires that occur in the home,
and it is said that in Japan many such fires are caused when using oil todeep fry the Japanese dish tempura. Kitchen fires caused by tempura oilsometimes spread to other rooms. They not only destroy precious assets,
but in a worse-case scenario they can lead to fatalities.
To help prevent kitchen fires in Japan, it has been legally
mandatory for all burners on gas tabletop stoves made after October
2008 to be fitted with safety sensors. These gas tabletop stoves withsensors are called “Si sensor stoves.”
As a manufacturer with a large share of the gas stove market, Rinnai believes it has fulfilled its
responsibility by promoting the widespread adoption of such products that offer enhanced safety. Because of thelong replacement cycle for gas stoves, many customers are unfamiliar with the safety provided by Si sensor stoves.
To encourage customers to consider replacement, we provide information on the safety of Si sensor stoves throughvarious means, including exhibitions, catalogs, and the Rinnai website.

Bathroom heater/dryers create “barrier free temperature” environments
Taking a bath should be a relaxing experience, but in Japanthe number of deaths that occur while bathing has been
increasing annually. According to statistics, each year
around 17,000 people die while taking a bath—more than
three times the annual death toll from road accidents. The
most common causes of bathroom deaths are strokes andheart attacks brought on by “heat shock.” With the elderly
population accounting for a large number of such deaths,
the prevention of such bathroom incidents will become amajor issue in Japan, a country with an increasingly aging
population.
It is said that eliminating sudden changes intemperature prevents “heat shock.” Bathroom
heater/dryers that create a barrier-free environment bywarming the bathroom in advance are expected to make asignificant contribution to preventing bathroom deaths.

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CSR Report 2014│Initiatives Delivering Safety and Peace of Mind

Rapid response time and an evenly heated bathroom provide peace of mind
In light of this situation, Rinnai is promoting the proliferation ofbathroom heater/dryers.
Our “Bath Hotto” bathroom heater/dryer is a gas hotwater-type heater/dryer that features a rapid response time. When theheater/dryer is turned on before taking a bath, it takes 15 minutes forthe bathroom temperature to reach 35 degrees. Another notablefeature of this product is that it heats the entire body evenly fromyour head down to your toes.
As the name suggests, the bathroom heater/dryer comeswith a function that dries the bathroom after bathing has finished.
This has several advantages, including the prevention of mold,enables the bathroom to be used to dry clothes.

Bathroom heater/dryers (ceiling embedded type)

Bathroom heater/dryers (wall-mounted type)

Publicizing the danger of bathroom accidents and promoting the features of the bathroom
heater/dryer
Going forward, Rinnai will work to inform the public of the dangers of bathroom accidents and the features ofbathroom heater/dryers. As a manufacturer as well, by publicizing the outstanding features of the bathroom
heater/dryer we would like to help reduce the number of people who die in the bathroom, even slightly. Morespecifically, we plan to use the various kinds of communication tools available to us, such as the Company’s website
and CSR Report, to disseminate information. At the same time, we will conduct PR activities at exhibitions andsimilar events.

We must be mindful of dangers to our health:Heat shock caused by temperature changes
Heat shock occurs in the bathroom in winter time and is caused by the sudden differences in temperature between thebathroom and other rooms. The human body is geared to constantly try and maintain an even body temperature.
Therefore, when the air temperature falls the blood vessels contract in an attempt to maintain warmth, which raises
blood pressure. If the air temperature is hot, the body sweats in an attempt to cool down. When applied to taking a
Japanese bath, once we have stepped into a cold bathroom after leaving a warm room and taking off our clothes, ourblood vessels suddenly constrict. Then, we immerse ourselves in hot water and our blood vessels open, which causes
our blood pressure to plummet. This difference in temperature places a burden on the heart and blood vessels, which
is why it can cause heart attacks. The reason why there are more bathroom accidents of this kind in winter comparedwith summer is that there is a considerable difference in temperature between the bathroom and the outside airtemperature.
People with high blood pressure, hardening of the arteries, or diabetes, or those who have suffered angina,
heart attacks, or strokes are more prone to heat shock. However, care is required even if none of these applies to you.
People aged 65 or older must take particular care. This is because as we age the mechanism that maintains a constantbody temperature has more and more difficulty functioning. Even if you think you have no health problems, you
should be aware that heat shock is a phenomenon that can happen to anyone. Also, when bathing in hot water for along time, a person can lose consciousness if his/her blood pressure drops too much. It is possible to drown if you
become unconscious in the bathtub, so care is needed at such time. The most effective way preventing heat shock is
to heat up the dressing area and the bathroom. Another way of reducing the burden placed on your body is to shower
first and not suddenly immerse your whole body in a hot bathtub. The first step in prevention is to take care to ensure
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CSR Report 2014│Initiatives Delivering Safety and Peace of Mind

that you don’t feel too hot or too cold.

Dr. Kazuo Mano, Assistant Director,
Red Cross Nagoya Daiichi Hospital

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CSR Report 2014│With Our Customers

With Our Customers
We provide our customers with products and services that they can use with total confidence,
so that they can lead “comfortable lifestyles.”CS Policy
Based on our corporate philosophy “Quality is our destiny”, we handle our customers’ requests sincerely,
promptly and appropriately, and provide satisfying, assuring and reliable services and consultation to them.

Fundamental Policy
1. We—that is, any department of our Company— identify comments and requests from our customers as our
top priority.
2. We understand that customers’ complaints are addressed to the entire Company and the whole organization
shall be responsible for them until the cases are closed.
3. We take customers’ comments seriously and share them within the Company to utilize as precious
information to improve our products and services.
4. We always abide by laws and regulations and we don’t give in to unreasonable demands.
5. We strictly protect the personal information of our customers by observing related laws, regulations andRinnai’s Personal Information Protection Regulations.

Measures for Quality
Basic Stance on Quality
Since our establishment, at Rinnai, we have always been executing our business operations being passionate
about quality for our customers to safely use our products with peace of mind.
Indeed, our policy on quality-infused by the corporate philosophy "Quality is our destiny"-stresses efforts
to provide customers with highly safe and satisfactory products. This enduring commitment gives customers
complete peace of mind in selecting and using Rinnai products.

Basic Philosophy on Quality

Policy on Quality"Quality is our destiny"

We provide highly safe productsthat meet customers' requirements.

Voluntary Action Plan for Product Safety
In June 2007, we formulated a voluntary action plan for product safety along with a promotion strategy thatwould give substance to activities based on the action plan. We encouraged divisions to embrace the action planand its associated promotion strategy, confirmed that divisions were on board, and wrapped up the process in
February 2008. Currently, the Quality Assurance Headquarters oversees the voluntary action plan for productsafety, verifies implementation status as appropriate, and guides efforts to uphold our policy on quality day in andday out.

76CSR Report 2014│With Our Customers

Product Development in Pursuit of Safety and Peace of Mind
The nature of our business—making and marketing gas appliances—demands monozukuri (manufacturing)prioritizing safety. We deliver products developed and manufactured in accordance with industry specifications
and safety standards.
Safety is ensured through assessments specific to each stage of the commercialization process,including design reviews that evaluate product performance and reliability. We deal with issues that crop up on a
day-to-day basis in partnership with the relevant divisions. In the event of a particularly serious issue, we call ameeting of the Quality Committee in order to discuss response measures with management.
1.
2.
3.
4.
5.
6.
7.

Product quality and safety initiatives
Product safety promotion system
Market quality information gathering/dissemination system
Handling product issues and analyzing information
Avoiding risks during product usage
Internal education
Checking implementation of our voluntary action plan for product safety and making ongoing
improvements

Monozukuri which assures high quality
In-house development of core technology
To assure our products to achieve high quality and safety, we pay considerable attention to our core technology
including "combustion control technology", "heat exchange technology" and "fluid-control technologies used forgas and water" and critical security components are developed and manufactured by our group companies. By
achieving high-precision heat control using sensors and electronic units, we are pursuing absolute safety and zero
defects.**Zero defects: No failure, no defect products and no fault

Integrated production system
Critical security components which affect the quality of products are manufactured with an integrated production
system from a raw material processing phase to an assembling phase paying extra-attention to manufacturing
technique. Moreover, important production equipment, dies and IT system are all developed within the Group. We
have been manufacturing high quality products by arranging the production of both critical security components
and manufacturing tools within our group companies.

Information disclosure on “Safety and Peace of Mind”
In the event, however remote, that a Rinnai product malfunctions during use oran accident results from a defective Rinnai product or insufficient service
thereof, we promptly report the details to the competent authorities inaccordance with prevailing laws and regulations. Even when it is unclear
whether or not an accident is attributable to one of our products, we still provide
pertinent information on our website to alert customers and applianceinstallation and repair providers to a potential safety issue.
Customer-facing page on Rinnai website

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CSR Report 2014│With Our Customers

Invigorating Quality Improvement Activities
Seeking to enhance the problem-solving skills of each and every employee and invigorate the organization, we
began promoting small group quality control circles. Involving our group companies, we are actively promoting thisQC program. We award to the best circles at the company-wide QC circle conference in September.

Company-wide QC circle conference

Inquiry Response and Support System
Customer CenterWe established the Customer Center in an effort
to improve customer satisfaction even further, by
accepting a range of inquiries, comments andrequests, either directly from customers or via
channels such as telephone or our website. The
numerous invaluable comments we receive arethen fed back to the relevant division, so that they
can be used to identify and rectify issues, in areas
such as product development, quality control,
sales and service standards.
We strive to incorporate customer comments
into our products and services on a daily basis

The Customer Center handles requests received from customers via our toll-free number, website and otherchannels. In fiscal 2014, we received approximately 960,000 calls from customers and around 4,200 comments
via our website.
In fiscal 2014, we received the following scores based on customer questionnaires.
- Ease of contacting Customer Center via toll-free number
87.5 points- Politeness of telephone operator
90.6 points*We have revised the evaluation categories on questionnaire cards since last year.

Customer center

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CSR Report 2014│With Our Customers

Our Customers’ Comments (Customers’ comments and inquiries through our website in fiscal 2013)

The breakdown of inquiries from customers is 79% from individuals and 21% from companies.

There are the three major topics: (1) Product in use: 39%, (2) Product that a customer is considering purchasing:
36%, (3) Parts & products: 11%

Many inquiries were kitchen appliances-related. : (1) Kitchen appliances: 43%, (2) Water heater and bath-related
products: 26%

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CSR Report 2014│With Our Customers

Strengthening our website capability to respond to our customers
Responding to our customers' request who would
like to solve their issues by themselves, “FAQ” islisted on our website.
In fiscal 2014, we increased the volume
of information provided via FAQ to 376 items(according to product type).
There has been an increase in the number ofcustomers accessing the FAQ section compared
to last year.
In fiscal 2014, 77.7% people gave a favorable
evaluation on our FAQ section. We will continue
to review and expand content in order to be more
useful to our customers in the future.

After-Sales Service
We provide our customers with services that they can use with total confidence, so that they can lead“comfortable lifestyles.”Immediate offering of after-sales service
About 700 service specialists provide repair service nationwide every day. We make every effort to complete
inspections the same day or by the following day, as part of our after-sales services for a more “comfortable
lifestyle.” We were one of the first to provide service specialists with mobile PDA terminals, to help improve
operational efficiency. This enables specialists to receive service orders and confirm order status onsite, so thatthey can provide services as quickly as possible.

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CSR Report 2014│With Our Customers

Evaluating performance based on service specialist questionnaire cards
We ask all customers who have been on the receiving end of repair services to complete a customer questionnaire.
Covering topics such as manners during repair visits, questionnaires enable customers to rate us based on their levelof satisfaction. We then make effective use of questionnaire results by providing internal feedback on customer
comments.
The 17,000 customers who completed questionnaires in fiscal 2014 gave us an average score of over 94.5.

Inspection and Repair Services
For a long-term use without accidents- Inspections like a yearly medical check-up for appliances In April 2009, Consumer Product Safety Act was revised and a safety inspection system for products in long-term
use went into effect.
Some accidents linked to the deterioration of our products over long-term use have been reported. To makecustomers realize that appliances, like most products, have a particular service life and to encourage customers tohave their Rinnai products inspected regularly, we send out the necessary information and extend advice throughthe Product Inspection Center. These efforts are aimed at preventing unforeseen accidents.
We enhance our maintenance inspection system with our qualified service specialists. In addition, we
provide our original services extending a warranty period to three years for the customers who purchased our homeuse hot-water unit and completed customer registration.
In April 2011, we also introduced a voluntary inspection system (Safety Inspection) for our outdoor hot-water units,in accordance with the law. This system has been gradually expanded; for instance, indoor hot-water and heating
units were added to the subjects of legal inspection in July 2011.
Three years on from the introduction of the inspection system, in June 2012 the Ministry of Economy, Trade andIndustry revised its guidelines in an effort to reinforce the system. As well as complying with these revised
guidelines, we have also updated our website.
In 2014, five years on from the introduction of the inspection system, we began putting in place an extended
inspection framework in preparation for full-scale inspections in the near future.

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CSR Report 2014│With Our Customers

Fundamental stance toward inspection
Through inspections, we will enhance our customer support services.
Five focused points of our fundamental stance
1. Good inspection (Good inspector, good handling, legal knowledge, and inspection report)
2. Look through our customer’s eyes (Usage of aged products, and reflection of customers’ comments on products)
3. Customer satisfaction (Appropriate and caring information offering)
4. Proposal to assure peace of mind (Proposal to bring peace of mind before a product breaks, not after it has broken)
5. Trust building (Showing our appreciation for our customers’ long patronage)

Efforts to coordinate an inspection system
To adequately implement inspection, Product Inspection Center keeps improving its inspection system.
In addition to the legally required check points of an inspection system, we also set up voluntary monitoring items
to facilitate a reliable inspection system.
[Voluntary system action items and the current status]
Action items
Rinnai’s current status
Enhancement ofprovision of
information

We post the detailed information on maintenance and inspection system for our products for along period of time on our website. The information includes the products that are out of
scope of legally mandatory products (specific products that require maintenance).

Enhancement of
items to beinspected

In addition to the items of which inspection is legally required (specific products that require
maintenance), we set safety inspection products including home-use outdoor gas hot-water
units, built-in-stoves and gas fan heaters.

Inspection quality
improvement

The inspection results of all items are checked to see if there is any judgment error to assure
the technology standards. The inspection completion rate is monitored all the time not todelay the inspection schedule.

Warning after theinspection

When an inspection result concluded the prohibition of the use of a product, we will provide
the follow-up of the inspection by calling or writing to the user.

Information about the inspection reminder function posted on the website
In November 2011, we posted information about the inspection reminder function on our website.
This function reminds users of legally mandated “specified maintenance products” of the period for theirinspections after they are used for 10 years under normal conditions. Users are reminded of the period in ways
such as a blinking light or indication on the remote control. This function also encourages users who have notsubmitted user registrations to submit them and apply for inspections.
Users who have submitted registration⇒ The user will be sent an inspection notice in the mail shortly before an inspection is due (inspection notices
include details of how to cancel the inspection reminder function).
Users who have not submitted registration⇒ After ten years of use, the inspection reminder function will notify the user that an inspection is due (if theuser has submitted registration upon request, they will be sent details of how to cancel the inspection reminderfunction by mail).

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CSR Report 2014│With Our Customers

Overview of our maintenance and inspection system

For the safe use of products, we recommend an inspection in 9 - 11* years after the production.
*For home-use appliances (Professional use: 2.5 to 4.5 years)
Designedstandard
service life*

Target product

Home-use gas hotwater units
Electric dishwasher
and dryer
Commercial-use
3-year product indoor-type gas hot
water heaters
10-yearproduct

Inspection
period9-11 years
after
production
2.5-4.5 years
after
production

0-6 months
in advance

Production Purchase

Registration1

Notification

Inspection
periodInspection2

Suspensionof useWhen you receive a notice, please apply for an inspection.
You can also request an inspection during the time of 1 and 2.

“Designed standard service life” is a period that a product should be safely used without any problems under the normal
circumstances with proper handling and maintenance. This is defined for each appliance. Please note that this is not the same
as free warranty period. In addition, products that fall outside the scope of legal inspection (specific maintenance products)
use the terminology, “Standard service life as designed”.

Users are encouraged to have their equipment inspected during the two-year inspection period. If we do notreceive a reply in response to the initial inspection notice, the user will be sent a repeat inspection notice by mailwhen there is one year remaining before the end of the inspection period, so that they can continue to use theirequipment safely.
The period for legal inspection of commercial-use equipment produced in April 2009 started in October 2011, so
we began sending notices on the inspection to applicable customers. About 70% of customers who responded to
the notices applied for the inspection, suggesting their high interest in the inspection system. Accordingly, we will
strengthen measures for informing customers of the system, aiming for (1) a higher registration rate and (2) ahigher rate of inspection applications.

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CSR Report 2014│With Our Customers

What is the “safety inspection system for products in long-term use”?

The “safety inspection system for products
in long-term use” started in April 2009 is asystem to encourage the registration ofusers and charged inspection for "Specified
Maintenance Products" that may cause
problems due to the age-related
deterioration and may damage and may
give serious damage to the life or health of
consumers.

Rinnai products corresponding
to safety inspection system
Indoor-type gas instant
hot water heaters(for city gas, and LP)

Indoor-type bathwater heaters
with gas burners(for city gas,and LP)

Dishwashers(built-in)

Flow of Safety Inspection System for Products in Long-term Use

Suppliers

Owners

Always explain thesystem at time of sale ordelivery.

Listen to the explanation
about the system at thetime of purchase

Owners (and Suppliers)

Registration

Owner’s Card
(packed withproduct)

Rinnai
Mail

Online registration
Registrationof changes

By phone

Information
Management

Inspection
reminders sent
by mail toregisteredappliance owners

By card enclosed with notification

On-siteinspection

By phone
Inspection
By card enclosed with notification

Recommendation of “Safety Inspection”
In consideration of the safety inspection system for products in long-term use, we recommend “Safety Inspection”
for products that fall outside the scope of the system.

The scope of the safety inspection•Outdoor-type gas hot water heaters and bath water heaters(Including hot-water and heating units, and heat sources
only for heaters)
Gas hot-water units
Gas bath heating systems
Gas heat source for hot-water units and heaters
Gas heat source only for heaters• Gas heaters
Gas fan heaters
Gas fan-forced heaters
Gas stove
Gas dryer• Built-in-stoves

Built-in-gas-stoves
Built-in-gas-oven* Some products are out of scope.

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CSR Report 2014│With Our Customers

Promoting registration
User registration is the important “first step” to connect customers with Rinnai. Information regarding inspections
is contained in our catalogs and on our website. We also actively encourage customers to register with us during
repair visits and other situations in which our staff have the opportunity to interact directly with customers.

From registration to inspection
Based on data provided by registered users, we mail inspection notices* to the designated address when therelevant inspection period approaches. We also carry out inspections for products that are already in use,with orders taken via our Product Inspection Center.
*Products subject to inspection notices: Any gas hot-water unit with a user registration card attachedFree inspection of small, open-type water heaters
In 2007, one of our small, open-type water heaters malfunctioned and caused an accident. To prevent areoccurrence of this kind of accident, we continue to offer free inspections to customers using small, open-typewater heaters, including the RUS-5RX, produced between July 1991 and January 1995, and the RUS-51BT,
produced between May 1994 and January 1997.
Expanding eligibility for inspections: We carry out inspections for small, open-type water heaters that do not havean “inspected” sticker affixed, even if they were manufactured before April 2009 (including two models that haveexperienced problems).
Precautions after inspections: In cases where usage of a product is prohibited as a result of an inspection, we
follow up on the relevant inspection at a later date, by telephone or in writing.
Notification on our website
We show subject products and contact for inquiries on our
website. To see the information, click on the banner on the top
page.

Questionnaires
Customer trends in response to inspections
We continue to expand customer support via our inspection services.
We are always reviewing inspection procedures based on information from inspection questionnaires, so that we
can improve our services even further.

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CSR Report 2014│With Our Customers

Forming New Relationships with Customers
Harnessing the Power of the Internet to Improve Customer Support
To enable our products to be used for a long time, we sell cleaning products and parts
that our customers can replace by themselves via our online shopping site “R.STYLE(RINNAI STYLE).”In fiscal 2014, the number of registered members surpassed 210,000,
opening up even more opportunities to interact with customers using Rinnai
products. We communicate with our customers through channels such as
conducting online questionnaires (24 times a year), planning products thatreflect customers’ needs based on gathered data, and resolving issues. We
will continue to increase direct interaction with our customers in the future,in an effort to improve our services.



Priorities amongst younger age groups tend to include “I don't spend time preparing or cooking food”, “Youcan eat breakfast without taking your time over it”, “I just want to get something in my stomach” and“Breakfast is cheap (doesn’t cost much money)”.
Priorities amongst those in their 60s or older tend to include “I eat breakfast every day”, “I try to eat anutritionally balanced meal”, “I like to eat breakfast with my family” and “I try not to eat too much”.

Using customers’ comments via the website to improve the company
We receive a great many comments and suggestions regarding our products andservices from customers who have used our online shopping site R.STYLE (RINNAISTYLE). As of the end of fiscal 2014, we have received a total of 25,748 comments
to date. We quickly share customer comments via an internal site called “Himawari
Messenger”. This enables individual divisions to examine shared information andtake steps to improve quality or broaden the scope of their services.

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CSR Report 2014│With Our Customers

Providing useful everyday information via social media
In an effort to provide a new content service, in May 2014 we launched “Goto-kun’s Daily Recipes,” a recipe site tohelp people decide what to cook. The site provides a daily selection of seasonal recipes, along with detailed
instructions and lots of photos, to assist people struggling to decide what to cook on any given day.
We also launched an official R.STYLE Facebook page in June 2014. The aim is to create more points of contact withnew customers, by providing useful everyday information in areas such as cleaning and storage, as well as theaforementioned daily recipes.

Helping people decide what to cook: Goto-kun’s Daily Recipes*This is a dedicated content service for smart phones. If you have a smart phone, you should give it a try!

87

CSR Report 2014 │With Our EmployeesWith Our Employees
We strive to create an atmosphere in which employees can be happy and productive—a corporate climate that
motivates each and every employee to do well and enables individuals to demonstrate their full potential. We alsoseek to maintain workplace environments that keep employees safe and healthy, both physically and mentally.
For our employees to be able to work with a sense of achievement and accomplishment, we provide support
through our personnel system as well as various welfare programs to take care of employees' health and cater for
their families. Moreover, for each employee to fully demonstrate his/her capability, we try to create a family-likeoffice culture, and improve and maintain our workplace to be safe, secure and healthy. We believe that the sourceof motivation for employees to grow and fully demonstrate their skills is "the provision of the opportunities toimprove" and "the sense of achievement and accomplishment". To increase the satisfaction level of ouremployees, we are promoting the following four items as our foundation:(1) Provision of opportunities for our employees to grow [Rank-specific training programs, specialization
courses, On-the-Job Training (OJT) guidance, appropriate staff allocation and rotation](2) Evaluation and reward which is fair and convincing (Performance appraisal, interview system, salary
increase and benefit improvement)(3) Creation of family-like working environment (Improvement of office building, working environment andfacilities, annual events, club activity support, and interdepartmental cooperation)(4) Welfare program for employees and their families (Welfare program options, health support, corporate
pension and events with the Rinnai Employees' Association)

Personnel Training
We defined our fundamental human resources policy as "Nurture and encourage our employees to have a highlevel of morality and keep challenging their own goals continuously making effort." We guide and train our
employees to be able to demonstrate their initiative to drive the Company while giving priority to our Corporate
Philosophy embodied in our Company Motto, "Harmony, Spirit and Sincerity", which Rinnai has been pursuing
since its establishment in 1920, and our Corporate Mission, "Rinnai utilizes heating to provide society with a
comfortable way of life."
We provide our employees with numerous opportunities to grow as an individual such as rank-specific training
programs, specialization courses, OJT trainings and a rotation training program, which covers workplaces athome and abroad.

OJT Personnel Training
We position human resources as our most important management resource
and we offer personnel training to assist employees to fully demonstrate
their capabilities. Our main training is on-the-job training (OJT), wherein asupervisor guides his/her team member through an actual job. In addition,
we provide a rank-specific training program, which supports the
improvement of each employee as an individual by grouping themaccording to job responsibility, and a specialization course, which promotes
our employees to be highly specialized in their area. These three programs
form three pillars of Rinnai’s training system. Moreover, we are conducting
a level-up training program for Group leaders who have been promoting
our business plan since fiscal 2011. We plan and provide high-quality
internal training programs.

88

CSR Report 2014 │With Our Employees<Major Rank-specific Training Programs in Fiscal 2014>
Training

Subject

Content

Numberoftrainees
140
people112peopleNew employee
training programNew
employees

Basic training for professionals (manners, awareness as aprofessional), Fundamental training for Rinnai employees(company overview, the Rinnai Spirit, corporate ethics,
personnel system, policy on quality and environment), IT
skills and mental health

New employee
follow-up training

Generalists intheir 1st year,
clerical
employees(technicalemployees) intheir 1st year

Training for increasing motivation to work and raisingprofessional awareness(Reconsolidation of what was learned in the new employee
training program; employees who joined the company inthe same year gather and share information about theircurrent status)

S4 level qualified
employee training

S4 levelqualified
employees

M6 level qualified
employee training

M6 levelqualified
employees

M6 level qualified
employee followup training
Performance
reviewer training

M6 levelqualified
employees
Managers whoneed toreview/intervie
w their teammembers

Reconsolidation of fundamentals (corporate ethics andmanagement policy), Recognition of his/her characteristics(to improve the strength) and the reinforcement ofawareness of management (creation of management plans)
Reconsolidation of corporate ethics and management policy
Understanding duties of managerial supervisors (rules of
employment, Labor Standards Act, handling of problematic
employees), Understanding of management
Reaffirming shared goals
Reconsolidation of values concerning managers’ actions
Reviewing the efficiency of the entire workplace
Reconsolidation of personnel system, objectives of
performance review and its method, and actual interview
sessions (coaching and listening)

New employee training program

112
people55 people

55 people

42 people

President’s speech

Career Development Review and Support
Visualizing skills of individual employees and guiding their growth (capability evaluations andfeedback of the results in one-on-one interviews)
For each training program to function effectively, it is essential to match the capability required by theorganization and the goals set by the employees.
Therefore, Rinnai prepares a "Skills Map" and a "Capability Evaluation Sheet" to define the skills
and capabilities required by each department and to clarify the goals and capabilities the company expects
the employees to achieve. Based on these tools, our employees understand their current roles and89

CSR Report 2014 │With Our Employees

responsibilities. Employees also have a one-on-one interview with their supervisor, during which theyreceive the results of their performance evaluation and are informed of the company's future expectations ofthem. They then set up their own goals to challenge every year.
Supervisors, to actively perform the responsibility to navigate the growth of their staff, carefully
review each staff's progress and contribution (performance evaluation) and adequately inform the staff of theresults of the evaluation through one-on-one interviews or performance appraisal feedback meetings.

Support for Self-Directed development
To support each employee to acquire higher specialist knowledge, skills and culture and support their growth
as an individual, we actively provide programs including foreign language education, correspondence
courses, external open seminars, technical proficiency examinations, license acquisition courses, andcommunication with people in different companies/industries. We provide rank-specific training programs tocreate opportunities to be aware of aspects for strengthening one’s sense of humanity. To employees whowish to develop themselves, we actively provide programs including foreign language education,correspondence courses, external open seminars, technical proficiency examinations, support for attending
national license acquisition courses, and communication with people in different companies/industries.
In addition, for the young employees who have a strong desire to work overseas, we arrange andoperate a short-term overseas working and training program that is available for them via application. This is
to develop human resources that can globally demonstrate their capabilities working at our overseas
locations. Currently, a total of six young engineers are working under this program in the United States,
Australia, Brazil, and Thailand. By providing our employees with opportunities to work at our overseas
locations in this way, we promote development of human resources that can demonstrate their abilities at a
global level.

Development of Global Human Resources
We aim to develop human resources who can demonstrate their abilities beyond national boundaries andimprove the capabilities of Rinnai Group employees all over the world. Therefore, the management
divisions, product development divisions, and manufacturing divisions are developing their own training
courses and OJT programs implemented via employee exchange. We provide opportunities for Japan-based
employees in their 20s (at the earliest) to be assigned to overseas Group companies, which improves theirability to adapt to foreign cultures and their international business sense through actual overseas work
experience.
(1) Management Department
At the management division of the Head Office, we regularly visit our overseas locations to provide
instruction on management and accounting and to develop human resources. We also launch business reformprojects when specially requested. Under such projects, specialists from Japan develop local executives
through planned visits to overseas location that provide them with instruction on methods for improvement
in a way that allows them to achieve results through practical operations.
(2) Product Development, and Production Department
We actively promote human resource exchanges between Japan and overseas locations, with about 20
employees participating each year. Staff members from our overseas Group companies receive OJT in Japanfor about one year, learning practical skills and what to improve at their own companies at the development
divisions, factories, and management divisions in Japan. Japan-based employees assigned overseas practiceproduct marketing and handling of quality issues, as well as improvement of factories’ manufacturing andproduction systems. Through these activities, they hand down the key themes that constitute our corporate
culture and expertise on Japanese-style monozukuri and quality assurance to local managerial staff.

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CSR Report 2014 │With Our Employees

Comment from an Employee Stationed Overseas 1
It has been two years now since I was assigned to the role of technical advisor
here in Brazil, providing support for development, production technology andmanufacturing. Whereas I focused on specialist technologies used to
manufacture dies before being assigned to my current position, over here I’mrequired to handle management duties across a range of different fields,
making decisions about overall optimization three years down the line. My
local colleagues are very supportive, but I continue to struggle with cultural,
practical, technical and historical differences compared to Japan. Outside
work, I belong to the company’s cycling club and am constantly being helped
Kenji Miyakoshi,
along by the uniquely friendly people here in Brazil. Amidst the excitement of
Rinnai Brazil Heating Technology
the Soccer World Cup, Rinnai has proudly established a leading share of theLtd.
market, as the only manufacturer producing gas water heaters here in Brazil.
In the future, I want to share Rinnai’s hot water culture and improve people’s lifestyles throughout SouthAmerica. To do that, we need to manufacture products that local people need inexpensively and deliver themwithin a short space of time. With that in mind, I will continue to coordinate with Japan and work with local
members of staff to promote “local production for local consumption”, and to help accumulate technology
through in-house manufacturing. I consider that my duty as I move into my third year.

Comment from an Employee Stationed Overseas 2
It’s been roughly one and a half years since I moved from the Production
Engineering Division to the Adelaide Factory here at Rinnai Australia. I covera wide range of duties, including ensuring conditions for quality products,
designing processes for new in-house products, and planning and designingcost cutting measures. Working directly on manufacturing at an overseas
factory makes for a truly fulfilling job on a daily basis.
There are times when I find what I want to say is incorrectlyinterpreted or get into arguments due to the language barrier and differing
Shinya Otsubo,
customs, but I am constantly reminded of just how important it is to build
Rinnai Australia Pty., Ltd.
relationships based on mutual trust and understanding.
I intend to learn more about Australian culture, customs and products in the future, so that I can build
even stronger trust and perform my duties in partnership with local members of staff.

Comment from an Employee Stationed Overseas 3
Having previously been on assignment in Singapore, I have now been working
in Malaysia for roughly two years. At present, my job mainly involves
providing management support in Malaysia in my role as personal assistant to
the President, and acting as intermediary between Japan and Malaysia.
There are times when it is difficult to reach an understanding due to thelanguage barrier and cultural differences, but I am constantly reminded just
how important it is to persevere and keep on trying to get your message
through. Despite the fact that I have worked in two neighboring countries,
Takeshi Uno,people live their lives and think about things in very different ways, even
Rinnai (Malaysia) Sdn. Bhd.
when separated by such short distances. That keeps things fresh and is one of
the most interesting aspects of selling Rinnai products overseas.
I will continue to do my best on a daily basis, in an effort to embody our Corporate Mission “to use heatto provide society with comfortable lifestyles.”91

CSR Report 2014 │With Our Employees

Succession of Monozukuri, the Spirit of Manufacturing
Training at Production Technology Center"Production Technology Center" established in March 2010 is a place to pursue leading-edge monozukuri,
and an emphasis is placed on delving into core technologies. It is also a hub for developing human resources
involved in monozukuri activities at Group companies at home and abroad.
To pass Rinnai's monozukuri to the next generation, over 30 booklets of “Visual manual” were
produced as a talent developing support tool. Utilizing this tool, our staff qualified in various technical areas
provides detailed training on Rinnai's manufacturing technique accumulated from the past, for employees
including trainees from overseas Group companies.

Training

Visual manualTraining at Production Technology Center
We have set up “monozukuri legacy stations” at each of our facilities to accumulate and maintain intangible
assets, in the form of existing processing technologies, new technologies and “frontline insights” established byexperienced employees. As well as giving newly assigned employees the opportunity to learn the basics ofmonozukuri (manufacturing), we use stations as a means of sharing and conveying the essence of monozukuri andtraining employees in areas such as improving efficiency and reinforcing production management.

Employee conduct display(Oguchi Factory)

Coating training station(Seto Factory)

New Engineer Training
New employees who are assigned technical jobs at the Technology Center and Production Technology Center,
before their actual allocation to each department, receive onsite training at the Research and Development
Headquarters and Production Engineering Division as well as practical manufacturing training at factories andproduction Group companies to learn about the importance of monozukuri including product and technology
development.

Studying the structure ofdish washer

Studying the structure ofplug of gas appliances

Studying about gas combustion

92

CSR Report 2014 │With Our Employees

Work-Life Balance
Support for Work-life Balance
For all Rinnai employees to perform well attaining the sense of accomplishment and fulfillment balancing
work and personal life for each lifestyle, we continue to enhance our personnel system to support all
employees of any gender and nationality through their lives.
In fiscal 2013, we are planning to extend the period of childcare leave and childcare shortened work
hours, which many employees use, to strengthen support for working women. We will also actively develop
and apply measures for supporting health management.
< Major Programs and Measures in Fiscal 2014 >Number of users
Program and measureChildcare leave

Content
An employee who lives with and is the caretaker of a childyounger than 12 months of age can take leave until the child turns
1, or alternatively until the child is aged 1 year and two months.

Child nursing leave

In the event that an employee is the caregiver of a child that hasn't
been enrolled in an elementary school, or is the caregiver of afamily member that requires nursing, the employee in question
will be exempt from working late shifts (10:00PM - 5:00AM)
with the exception of cases wherein the employee's absence would
preclude or inhibit the continuation of normal business operations
An employee can take up to five days leave per year (10 days per
year if nursing two or more children)

Extended family careleave

In principle, total 93 days of leave may be granted per one family
member who falls in to the subject of the care.

Childcare shortened
work hours

Fiscal
2014

Fiscal
2013

58

42

54

57

2

2

1

2

0

0

0

0

Family care leave

Any employee who is responsible for a family member that
requires full-time or nursing care may shorten his/her daily
working hours, provided that a minimum of 6 hours are worked
each day. This provision is possible for 93 days per such family
member.
An employee can take up to five days leave per year (10 days per
year if two or more family members require care)

Work from home
program

The longest duration of "Work from home program" shall be one
year per application. Utilizing IT equipment, an employee may
work partially or entirely at home.

11Come Back program

The program offers an employment opportunity to our former
employees who had to leave the Company for unavoidable
reasons such as marriage, child-care and family-care, or on his/her
discretion.

00Measure to reduce
working hours (Flexible
working hours)

Depending on work plan, working hours and work start/end time
can be negotiated.

Measure to reduce
working hours (Noovertime day)Every Wednesday is set as “No overtime day” to encourage
employees to leave early.

Family-care shortened
work hours

Production
divisionsManagement
divisionsApplicable tocertaindepartments

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CSR Report 2014 │With Our Employees

Measures to Enrich Our Employees’ Family LivesThe Rinnai Employees’ Association is the lead organizer of courses for employees on the themes “Education
for the Soul” and “Passion for Life.” These courses are intended to prepare people for the different stages
that life will take them through, with a focus on ethics, communication skills, life planning and money
matters. Of the firm belief that a positive perspective on work is essentially a reflection of a happy home life,
we encourage employees to take advantage of opportunities, such as barbecues and sports days, where they
can gather as families with families. These events foster a sense of harmony among colleagues.
<Major Programs in Fiscal 2014>
Item

Overview

Nationwide events in Japan

Various events to promote health of our employees and their family
members and communication including bowling competition, barbecue
picnic, and sports festivals

Training seminars by age group

Training seminars focusing on the “Education for the soul” that supports
employees to develop attractive personalities as members of society

Nationwide Events
Chubu Sports Festival (Oguchi Sogo Ground)
Walking Festival (Higashiyama Zoo)
Kanto Festival (Odaiba Shiokaze Park)
Kansai Festival (Expo ’70 Commemorative Park)
Nationwide BBQ event, in Hokkaido, Tohoku, Niigata, Hokuriku, Nagano,Shizuoka, Hiroshima, Shikoku, and Kyushu

Chubu Sports Festival

Number of participants
1,674
1,640
185
192
476

Nationwide BBQ event (Hokuriku)

31st Walking Festival
This annual walking event is designed to let employees enjoy time with their families and raise their awarenessof health. The venue this time was the Higashiyama Zoo and Botanical Gardens where, under the theme of“endangered wildlife,” participants enjoyed environmental quizzes and games while walking the 10,000-step(approx. 4.1 km) course. A total of 1,640 employees and family members participated in the 30th annual event.

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CSR Report 2014 │With Our Employees

Training Seminar by Age
Personality design seminar
Life design seminar
Self-realization seminar
New employee communication seminar

Personality design seminar

Number of participants
72
110
68
123

New employee communication
seminarIndustrial Relations and Human Rights
At the Rinnai Group, aiming to provide the work environment and culture that employees can feel as "I am happy
to work at Rinnai.", the Rinnai Employees' Association and Personnel Affairs Division regularly convene theLabor-Management Council to confirm and share the information on management policy, actual results, andcomments from each workplace as a periodic improvement activity.
Moreover, our basic stance toward human rights, the respect for each other's personality and theprevention of harassment is compiled as "Rinnai Code of Ethics" to educate and enforce all employees in theGroup. In addition, we also established the Corporate Ethics Helpline to maintain the sound environment of theworkplaces.

Respect for Human Rights and Individuality
Our Group considers respect for human rights and individuality as one of its main pillars for performing its social
responsibilities as a company. We therefore strictly prohibit any form of discriminatory treatment based on
gender, age, nationality, physical characteristics, or any other attributes of individuals. We also refer to the ideasof the United Nations framework and ISO26000 and reflect them in the Rinnai Group Code of Ethics.
To promote and enforce the contents of the Rinnai Group Code of Ethics among all Group employees, acompliance committee member is allocated to each workplace to regularly conduct education on corporate ethics.
At rank-specific training programs, we also educate our employees based on their roles and job responsibilities.

Establishment of Good Labor Relations
The Employees of the Company are "members of the Rinnai Employees' Association" which functions as theorganization to represent entire employees.
Based on mutual understanding and trust, the Company and the Association establish healthy and soundlabor relations openly exchanging opinions on management issues, labor condition, workplace environment andcompensations and discussing improvement plans.
Moreover, the Company makes effort to provide safe working environment without any concern to theemployees of our business partners, etc. in addition to our employees. We also actively arrange and offer welfare
programs and various events and programs for our employees and their families.

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CSR Report 2014 │With Our Employees

Measure to Prevent Child and Forced Labor
As a measure to prevent child and forced labor, “Rinnai Group Code of Ethics, Rinnai Code of Conduct, Article
11 The respect for human rights and each other’s personality (4)” stipulates as “The Company should not allow
any inappropriate labor including harmful and exploitative child labor which lets under-aged children to work,and slavery against the will of employees.” Entire Group abides by and acts on this rule.

Measures to Prevent Harassment
To maintain working environment that our employee find comfortable, we take measures to prevent any
infringement of human rights including sexual harassment and power harassment.
To avoid our employee to commit any harassment without any intention and knowledge, we produced a check listof detailed examples of harassment case that is posted on the company-wide intranet for self-assessment.
Each year we also provide newly assigned section chiefs with harassment-prevention education toreinforce this prevention.

Support for More Active Roles for Female Employees(1) Current status of positions held by female employees
Ideas and comments from women are absolutely crucial to our products, particularly as they use so many ofour products on a daily basis. We have female employees playing key roles and demonstrating their individual
abilities across a wide range of areas, especially in product planning and design departments, sales planningand promotion departments, fixed customer sales departments and production departments. The percentage ofwomen in generalist positions (core jobs) is also increasing every year, with the number of women in
executive positions also rising gradually. As of July 2014, the company had two female managers and 57
female employees in managerial positions (3.3% of all generalist positions).

(2) Enhancement of Support Programs for Working Women
For women to keep working for the Company after getting married, we provide various working styles andsupport programs.
<Major Programs>
 Career track conversion system: A system which allows employees to convert from generalists to clericalemployees (when they do not wish to relocate for job assignment or if there is a request for shortened
working hours), or from clerical employees to generalists (because of superior work performance)

Reemployment system (Come Back Program): A program that enables former employees to return towork as a full-time employeeChildcare leave and Family care long leave: Programs to support employees to raise children

Shortened work hour system: A program to support employees to raise children and care their family
members
Flexible working hours system: A program to support employees to raise children, care their family
membersWork from home program: A program to support employees to raise children, care their family members
and recover from diseases

96CSR Report 2014 │With Our Employees

Fair and Diversified Employment
View toward Employment
We respect the diversity of individuals and provide employees with various job opportunities and a working
environment where they can demonstrate their various capabilities.
Rinnai Group Code of Ethics stipulates that "Any discriminatory act toward an individual based on
gender, age, nationality or physical characteristics, etc. is prohibited". Based on this, we maintain fair andequitable hiring practices, in line with prevailing business plans and recruitment needs.
In addition, we actively engage in mid-career hiring to capitalize on the accumulated experience andknowledge of individuals who showed they can make a contribution to our success. We hire about 25 skilled midcareer employees every year.

Reemployment of Retired Employees and Support for Demonstration of their
Abilities
Rinnai promotes a reemployment program for employees who retired due to the age limit in order to continuously
utilize technology and skills that skilled employees possess and to smoothly pass on the skills and the Rinnai
Spirit to following generations. There are currently 166 employees working under this program. We offer oneyear contracts until the age of 65, with a choice of three options, enabling employees to work full time, alternatedays or reduced hours. We also have a system in place to extend employment to the age of 68 in the case of
employees with outstanding specialist skills or abilities, to fit in with a wide range of individual lifestyles.
This reemployment program provides employees with purpose and motivation in life as a leader/mentor
and maintains and improves the corporate culture and dynamics within the workplace.

Promotion of recruitment of handicapped employees
Since fiscal 2009, we have promoted recruitment of handicapped employees in a planned manner by cooperatingwith the public employment security office and schools for the disabled. In the initial year, the employment rate ofpersons with disabilities at the Company was only 0.79%, so out of a sense of social responsibility (sense ofurgency) we took a more active stance toward recruiting handicapped people.
In July 2008, the public employment security office greatly assisted us with recruitment of handicappedpeople. The office allowed us to hold an exclusive job interview meeting at which we interviewed a total of 28
applicants and employed 15. We later began to recruit new graduates from schools for disabled students andimplemented an internship program for second-year students of those schools. The number of newly recruited
disabled employees has been increasing each year.
The Customer Center we established in fiscal 2011 has toilets and ramps for wheelchair users, andbarrier-free elevators; thereby improving the Company’s internal facilities for handicapped employees. The
employment rate of persons with disabilities at the Company has consequently been significantly improved to
1.76%. We will continue to promote recruitment activities and improve the workplace environment towardachievement of the legally mandated minimum employment rate of 2.0%.

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CSR Report 2014 │With Our Employees

Occupational Health and Safety
The Group gives priority to the assurance of the health and safety of our employees and stakeholders andabides by the laws related to health and safety. In addition, all the employees in the Group strive to create,
maintain and manage a working environment which is safe and sanitary and develop an active organizational
culture which encourages our employees to be physically and mentally healthy.

Basic Policy on Safety and Hygiene
An essential requirement in business is the assurance of the health and safety of employees, via the provision of ahazard-free and hygienic work environment. As Rinnai constantly strives to protect the life and health of all
employees we give top priority to the sanitary condition and safety of the workplace. This corporate mantra
extends to our customers, to whom we strive to provide “safety and peace of mind”.

Fiscal 2014 Basic Policy on Safety and Hygiene(1) Comply with all applicable laws and internal regulations(2) Undertake safety activities based on a clear understanding of risks(3) Maintain two-way communication between managers and workers(4) Improve health management and promote occupational health activities

Status of On-the-Job Accidents and Injuries
In fiscal 2014, we made efforts to achieve the goal of zero accidents under the Rinnai Companywide Health and
Safety Committee, serving as the administrative organization of Group companies in Japan. We recorded a total of
29 on-the-job accidents (seven fewer than in the previous year). [Divisional breakdown: 19 accidents in
production divisions, eight accidents in sales and marketing divisions, two accidents in research and development
divisions]
In response, under the improvement plan for fiscal 2015, we will comprehensively review what protective gear towear at each workplace and for each type of work, establish rules and standards based on the results of the review,
and make it a top priority to comply with the rules and standards.
With regard to the on-the-job accidents occurring in the previous year, each Group company will as soon
as possible take measures for preventing their recurrence. The entire group will thus make concerted efforts toensure prevention of accidents toward achieving the goal of zero accidents.

Accident Prevention Measures
To give our No.1 priority to work safety and peace of mind, the Group promotes various accident prevention
measures under the guidance of the “Risk Management Committee” headed by the President.
With the rising frequency of large-scale disasters at home and abroad, the Rinnai Group, aiming to build astrong corporate structure to withstand crisis situations, establishes business continue plans for a quick recovery at
the time of disaster.

98

CSR Report 2014 │With Our Employees(1) Activities to prevent fire and explosion: Enforcement of safety inspection of environmental safety equipment(gas feeders and furnaces, etc.) and test and evaluation equipment, and the improvement and renewal ofequipment as our top priority(2) Reduction of risk of earthquake damage: Preventing objects in factories and office buildings from falling over,
dropping, and scattering(3) Production site onsite guidance: Horizontal development of the production sites under the guidance of the
Safety and Health Committee of Production Group(4) Training for clerical work staff and new employees: KYT training for new employees including a monthly
information sharing session regarding on-the-job accidents, designed to promote work-safety awareness.
(5) Implementation of emergency drill: "Earthquake and fire drill" more than once a year
*KYT: Kiken Yochi (danger prediction) Training

With the rising frequency of large-scale disasters at home and abroad, the Rinnai
Group, aiming to build a strong corporate structure to withstand crisis situations,establishes business continue plans for a quick recovery at the time of disaster.

Emergency drill

Promotion of Traffic Safety
To minimize traffic accidents involving employees, various measures and education programs are provided. We
apply to the Japan Safe Driving Center, and obtain a certificate of driving record for each employee who isgranted permission to drive a company car or commute by car. This is to accurately gauge the number of
employees’ traffic accidents and violation of traffic rules to improve self-awareness for compliance.
In particular, it is mandatory for employees in sales divisions to report accidents and violation of rules, giventhat they spend more time driving than other employees. Depending on the details, an employee may berequired to take a safe driving course provided by an outside organization. We have also introduced a safe
driving “eco drive” promotion system at selected facilities, to monitor data on driving practices on a daily
basis. As well as raising awareness of safe driving, this also helps to improve fuel efficiency as part of ourenvironmental measures.

Driver education at a driving school99

CSR Report 2014 │With Our Employees

Care for Health
To promote the creation of a vibrant corporate environment wherein people can work healthily -bothphysically and mentally, it is a precondition that each employee to be health conscious and promote soundself-management and health enhancement.
To maintain and improve the health of our employees and their families, through collaboration with
the Rinnai Health Insurance Society, the Company encourages 100% of employees to undergo a medical
checkup and receive consultation from an industrial doctor if the employee requires further examination.
Various measures including mental health care workshops, medical checkup support, support for special
medical checkups (complete medical checkups and cancer screening) and introduction of subsidized sporting
events are also actively implemented.

Support for Health Promotion
Through the alliance with the Rinnai Health Insurance Society, we provide a range of medical support
services to our employees and their dependent families which include regular checkups as well as detection
examinations for various types of cancer (including prostate, intestinal and breast cancer checks). Thoroughphysical examinations are also available. For patients with lifestyle diseases, specific health guidance and an
individual follow-up are provided to make sure the employee is fully recovered.
For physical fitness, we are also eager to financially support sporting events organized by the employee
union and voluntary club activities for employees all over Japan (37 clubs including soccer, baseball, golf,
cycling, table tennis, bowling, and distance running) to promote employees’ health.

Expanding Health Promotion Activities
We have established a Health Support Office and organize employee health promotion activities overseen by
specialist health nurses. We offer health guidance and consultations for individual employees and run health seminars,
to provide information on subjects such as preventing lifestyle-related diseases.
We also organize mental health seminars and run a support program to help employees who have been on long-term
leave to return to work. We provide rehabilitative work-based support so that employees can return to the workplaceas smoothly as possible.
To prevent those working long hours from experiencing health problems, we set out standards that go
beyond legally required standards, and also arrange consultations with health nurses and industrial physicians.
In our employee cafeteria meanwhile, we work with nutritionists to provide menu options that are designed
to keep our employees healthy.

100CSR Report 2014 │With Our Employees

Mental Health Care
We make every effort to maintain sound workplaces by caring for the mental
health of our employees, focusing particularly on preventive measures andearly stress detection.
In fiscal 2014, we organized four courses; a stress self-care seminarto help employees diagnose and deal with day-to-day stress, a basic seminarfor managers to teach them how to manage and handle members of staff, andan advanced practical seminar for managers. A total of 465 employees
attended 19 seminars in total.
We have also introduced an external mental health care service that
employees can consult regarding concerns within their local community or athome, as well as individual concerns in the workplace.

Mental health care workshop

Managerial supervisor
Line care
Basic program

Applied program

Advanced program

New employees

Listener program

All employees

Self care
Basic program

Basic program

Applied program

External care

Mental health counseling service (telephone/face-to-face)

Internal care

Industrial doctors, public health nurse, health supervisors, labor managers

External Acclaim and Recognition
Certified by the City of Nagoya as a “company promoting women’s activities”
Rinnai was certified as a “company promoting women’s activities”, as partof a scheme operated by the City of Nagoya (Aichi prefecture) in fiscal
2014. Certification is granted to companies that are making a concerted
effort to ensure that women can play an active role, with commendations
presented to companies engaging in particularly outstanding initiatives. We
have been certified in recognition of three key initiatives aimed at
expanding frameworks, assigning duties and changing attitudes, to support
female employees so that they can play a greater role in the workplace.

Registered by Aichi Prefectural Government as a “family friendly company”
In March 2014, Rinnai was registered by Aichi Prefectural Government as a“family friendly company”, based on our commitment to ensuring that
employees can strike a balance between their work and private lives. Aichi
Prefectural Government has created this registration scheme in order toencourage companies to focus more on work-life balance, and to promote
initiatives on a broader scale.

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CSR Report 2014 │With Our Employees

Certified as “general business owner meeting standards”
In May 2014, Rinnai was certified by the Aichi Labour Bureau of the
Ministry of Health, Labour and Welfare as a “general business owner meeting
standards” in accordance with the Act on Advancement of Measures to
Support Raising Next-Generation Children, and was awarded the “Kurumin”
next generation certification mark. This serves as recognition of our efforts toformulate and implement action plans based on targets such as employing
specialist health nurses, securing childcare leave for male employees, andencouraging employees to take annual paid leave.

Human Resource and Personnel Related Data
We disclose human resource and personnel related data including the number of employees and the status of fulltime
employees.
Number of full-time employees (consolidated, year-end)
Fiscal 2012

Fiscal 2013

Fiscal 2014

(At March 31, 2012)(At March 31, 2013)(At March 31, 2014)

Male

2,471

2,517

2,534

Female

1,114

1,111

1,095

Domestic Group
Companies

Male

1,069

1,099

1,108

Female

578

582

567

Overseas Group
Companies

Male

2,326

2,361

2,969

Female

1,120

1,154

1,320

8,678

8,824

9,593

Rinnai Corporation

Total

Number of full-time employees by region (consolidated, year-end)
Fiscal 2012
Fiscal 2013

Japan

Asia excluding Japan

North America, andEuropeOther(Oceania, SouthAmerica)
Total

Fiscal 2014

Composition(At March 31, 2012)(At March 31, 2013)(At March 31, 2014)

Male

3,540

3,616

3,642

-

Female

1,692

1,693

1,662

-

Sub-total

5,232

5,309

5,304

55.3%

Male

1,876

1,923

2,511

-

Female

908

957

1,124

-

Sub-total

2,784

2,880

3,635

37.9%

Male

103

74

92

-

Female

35

35

41

-

Sub-total

138

109

133

1.4%

Male

347

364

366

-

Female

177

162

155

-

Sub-total

524

526

521

5.4%

8,678

8,678

9,593

100%

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CSR Report 2014 │With Our Employees

Number of employees (non-consolidated)

Male
FemaleMale
Mid-career
recruitment
FemaleAverage working years
Average age (years old)
Separation rate (%)
Paid leave utilization ratio (%)
Employment rate of persons withdisabilities (%)
Number of employees who used childcare
leave
Number of employees who used shortened
work hours
Number of employees who used the workfrom-home program
Number of on-the-job accidents
Newly recruitedemployees

Fiscal 2012

Fiscal 2013

Fiscal 2014

(At March 31, 2012)(At March 31, 2013)(At March 31, 2014)

82
54
11
17
13.7
35.7
2.2
37.5

102
61
15
13
13.7
35.3
2.0
36.2

92
49
6
13
14.0
35.8
2.3
36.6

1.65

1.71

1.74

47

42

58

33

57

54

2

1

1

31

36

29

103

CSR Report 2014│With Our Shareholders and Investors

With Our Shareholders and Investors
Policy on Information Disclosure
We disclose information in an appropriate, timely, fair and impartial manner, and engage in IR activities with anemphasis on two-way communication, in order to improve mutual understanding and build trusting relationships
with shareholders and investors.
In accordance with the Rinnai Group Code of Ethics and our Disclosure Policy, we adhere to theprinciple of disclosing corporate information in an appropriate, timely and fair manner, including details of theGroup’s management and business activities.

IR Activities – Communication with Shareholders and Investors
In an effort to provide our shareholders and investors with direct updates on our business activities, and to ensurethat information in disclosed quickly and fairly, we provide information via channels such as results briefings foranalysts and institutional investors (twice a year), biannual shareholder reports, press releases and presentationmaterials on our website, and our IR calendar. We also post IR information, including results and shareholder
reports, on the English version of our website in the interests of timely disclosure.

“Information for Shareholders and Investors” on our website, presentation materials, and our shareholder report

General Shareholders’ Meetings
We held the general shareholders’ meeting for our 64th term at the Meitetsu New Grand Hotel in Nakamura-ku,
Nagoya, on June 27, 2014. To encourage more shareholders to get involved in discussions and attend meetings,
we send out notices to convene earlier than the legally required date. We also make every effort to communicate
the company’s current situation to shareholders in a straight-forward manner, through business reports featuring
movies, images and slides for instance.

Communication with Institutional Investors and Analysts
In addition to biannual presentations outlining our results, we discuss our
performance and actively exchange opinions with institutional investors andanalysts through activities such as small meetings, visiting individual investors
and accepting telephone interviews. We also take part in conferences organized
by securities firms, in an effort to expand our IR activities. We organize factory
tours every year as an opportunity to provide a better understanding of ourcommitment to monozukuri (manufacturing).
Factory tour

104

CSR Report 2014│With Our Shareholders and Investors

Results Briefings for Individual Investors
We take part in events such as seminars for individual investors in order to giveinvestors a better understanding of our business activities. We use
accompanying materials to provide simple explanations of our corporate
philosophy, management policies, business strategies and overseas operations,
to give investors a wide-ranging insight into our activities.
Seminar for individual investors

Our Policy on Dividend
One of our top management priorities is to sustain a stable
return of profits to shareholders. Several factors play into thecalculation of dividends, such as consolidated performance,
return on equity and financial status.
Seeking to enhance corporate value, management
looks at retained earnings with a view to the long term,
effectively applying this source of capital toward R&D,
capital spending and investments accompanying the expansionof sales at home and abroad.
The annual dividend for fiscal 2014 was ¥68 pershare, up ¥8 per share from fiscal 2011.
This marked the 12nd consecutive year of higher dividends.

Share Information (As of March 31, 2014)
Number of authorized shares: 200,000,000 shares
Number of outstanding shares: 52,216,463(Including treasury stock)
Number of shareholders: 4,176

105

CSR Report 2014│With Our Shareholders and Investors

International Assessment of CSR Performance
Rinnai has been selected for inclusion in the FTSE4Good Global Index, a worldwide socially
responsible investment (SRI) index, for ten consecutive years since 2004. We were also ranked in the“Bronze Class” by Robeco SAM, as part of its CSR assessment for 2014. Robeco SAM takes around3,000 companies from all over the world and assesses their level of corporate sustainability from an
economic, environmental and social standpoint. The top 15% companies make it into “TheSustainability Yearbook,” with the most outstanding examples ranked according to three classes;
Gold, Silver and Bronze. This year, 222 companies were selected in 59 categories, including 19
Japanese companies. Rinnai was ranked in the Bronze Class in the “Household Durables” category.
This serves as recognition of our commitment to CSR-oriented corporate activities, particularly ourefforts to reduce environmental impact.

106

CSR Report 2014│With Our Business Partners

With Our Business Partners
Based on a fair-and-square approach to transactions, we undertake activities to strengthen bonds of trust andreinforce the teamwork structure and strive to realize stable, long-term growth for ourselves and our suppliers.

Coexistence and Prosperity with Business Partners
Rinnai Group Purchasing Policy
To grow along with our suppliers, we emphasize transactions based on a fair and impartial assessment andselection process and respect for laws and regulations and corporate principles, in accordance with the Rinnai
Group Purchasing Policy.

Rinnai Group Basic Policy“We will give equal opportunity to all companies at home and abroad
and undertake fair evaluations to procure excellent parts that meet our requirements.”

Rinnai’s Stance on the Relationship with Our Business Partners
Our suppliers provide us with the raw materials andmany of the components that go into the products wemake. They are business partners indispensable to thecreation of products that attract consumers to the Rinnainame. At Rinnai, we believe that building stable, longterm relationships with our suppliers and growing withthem as they grow with us is vital to the creation of
better products.

Realization of Fair-and-Square Transactions
In accordance with the Rinnai Code of Conduct in the Rinnai Group Code of Ethics, our supplier acceptanceprocess is applied uniformly, whether the company is an old-time supplier or seeking to become a supplier.
Our evaluations are fair, giving equal opportunity to any and all companies with the right stuff, whether athome or abroad. Essentially, the divisions involved in procurement—that is, divisions responsible for technology,
quality and purchasing—consider all factors, including quality, price and delivery as well as the potential
supplier’s technological capabilities, safety, and its environment-oriented activities, in reaching an impartial, wellconsidered decision.

107

CSR Report 2014│With Our Business Partners

Communication with Our Business Partners
We request our business partners to independently establish a quality assurance system and assure theimplementation of the system to help us achieve our policy on quality, “We provide highly safe products that meetcustomers’ requirements.”
We provide opportunities for suppliers to learn more about our perspective on quality and the basis ofmonozukuri at Rinnai through annual events including a get-together at the beginning of the year and policy
information meetings and regular meetings of the Supplier Liaison Group. These meetings are also ideal forgathering information through suggestions from suppliers and promoting dialogues based on submitted questions.
Indeed, these meetings promote a stronger commitment to teamwork.
We are similarly committed to using online resources to effectively coordinate information with as many
suppliers as possible, using an interactive information-sharing tool called R-LINE.
We are also working to strengthen supply chain management through R-LINE in areas other than quality
information and stable procurement, in line with the Reduction of Hazardous Substances (RoHS) Directive andother environmental legislation. This has facilitated the provision of information and enabled us to disclose
information to our customers more immediately.

Improvement Activities with Our Business Partners
We organize Level-Up Workshop events with our business partners, toprovide guidance on improving capabilities and training next-generation
leaders. The aim is for business partners to appreciate the benefits ofimprovements, through direct guidance with onsite operations for
instance, and to improve their level of monozukuri (manufacturing).
Specialist members of staff also provide individual consultations for nextgeneration leaders, to enhance essential skills and knowledge.
Our aim in providing onsite and management support in this way
is to improve overall standards at each of our business partners.

Level-Up Workshop

Measures for Risk Management and Stable Procurement
We are committed to risk management and stable procurement of parts and materials, so that we can ensure
customer satisfaction and reliably supply the safest possible products. With changes in demand and market
globalization however, our supply chain is increasingly expanding all over the world, making it virtually
impossible to reduce risks on our own. It is therefore essential to take joint measures with our business partners.
We are currently implementing joint measures such as dispersing production sites to guard against unforeseen
circumstances, gathering information on secondary processors and companies carrying out later processing,maintaining information on dies, leased equipment and other assets, and formulating business continuity plans(BCP), with our business partners.
We are also able to quickly arrange alternative production and equivalent parts in the event of a natural
disaster or other such unforeseen circumstances, so that we can minimize any impact on production activities.

Promotion of Acquisition of ISO9001 and ISO14001 Certifications
To ensure provision of high-quality, safe, environmentally friendly products, all our domestic factories acquired
ISO9001 certification (for quality management systems) and ISO14001 certification (for environmental
management systems).
We also ask our business partners to understand our approach to quality and the environment and toobtain ISO9001 and ISO14001 certifications or establish equivalent management systems, and we help them
operate the systems.
108

CSR Report 2014│With Our Business Partners

Working with Logistics Partners to Improve Logistics
Integrated Logistics Center, Rinnai Parts CenterAt our Integrated Logistics Center, we are working to establish a streamlined logistics
system linked to both production and sales, in an effort to improve the quality oflogistics and services.
With more orders for system products and growing demand for a wider variety of
products with smaller lot sizes, we are having to cope with more diversified requests
from our customers, such as shortened lead times before delivery and delivery tolocations where products must be actually installed. With that in mind, we havemanaged to consolidate our logistics bases in Aichi prefecture, where our production ismainly based into two. This has boosted logistic efficiency and helped to reduce theenvironmental impact.
The Integral Logistics Center has introduced item-by-item control with QR
code and an inspection system. QR codes, which identify each product, are affixed to
all products and utilized in many processes in the logistic centers such as when
products are brought in and out. By reading the data of QR code, we have drastically
improved the quality of logistics by preventing errors and improving the traceability ofeach item. In addition, the combined use of wireless terminals, real-time operation
instruction and actual result collection resulted in a significant improvement of theoperations.
In August 2013, we commenced operations at the Iwakura Logistics Center, asa central warehouse for smaller items. This has helped to improve the quality ofdelivery services and increased logistic efficiency for auxiliary and optional items. In
May 2014, we relocated the Rinnai Parts Center, which handles everything fromprocurement of auxiliary and optional items to manufacturing. Our aim is to integratemanagement from production through to shipping, in an effort to improve logistic
efficiency even further.

Integral Logistics Center

Product Label
Information includes
product code, gas type,production number,production date,
production line, etc.

Communication with Logistics Partners
Every April, we hold a logistics policy information meeting to help service providers gain deeper insight into thelogistics policy, targets and measures of the Company and logistics department. In addition, we arrange quarterly
partnership meetings to reduce environmental impact in relation to the transportation and storage of products, andto improve the quality. We also visit partners’ working sites regularly to share issues with them and help themmake improvements.

Our Logistics Partners’ Measures to Improve their Logistics Quality
In May 2010, eight of our logistics partners classed as mixed consignment carriers* established a “Logistics
Working Group”. The aim is to promote the improvement of logistics quality and safe transportation, throughinformation exchange and improvement activities spearheaded by onsite staff, focusing mainly on common issues
relating to quality. In fiscal 2013, the Working Group implemented specific measures such as regular visits topremises where cargo is shipped or received, producing awareness posters, and countermeasures to prevent
incorrect deliveries. The Working Group is helping to improve logistics services here at Rinnai as well as
performance levels at individual carriers. In fiscal 2015 meanwhile, we established a “Mass Merchandise
Working Group” and commenced improvement activities focusing specifically on logistics for massmerchandisers.
*Mixed consignment carrier: Services to transport consignment collected from any number of consigners, or an operator that offers theservices.

109

CSR Report 2014│With Our Business Partners

Measures to Improve the Logistics Quality with Logistics Partners
In fiscal 2012, upon the request of our logistics partners, we made it possible to print addresses and names ofdelivery destinations in kanji (Chinese characters) on invoices (delivery statements), on which it had previously
only been possible to print katakana characters. We have also improved our shipping labels (tags) by allowing theprinting of kanji. This has made printed characters more legible and facilitated checking by our logistics partners,
resulting in reduction of incorrect deliveries caused by characters being misread. We will continue to improve ourlogistics by cooperating with our partners for further efficiency in logistics operations.

Measures to reduce shipping amountThe company is designated as a specified shipper under the revised Rationalization in Energy Use Law.
Therefore, by cooperating with our logistics partners we strive to reduce CO2 emissions through such measures as
eco-friendly driving and establishment of appropriate transportation routes. In fiscal 2011, we consolidated our
logistics bases and eliminated and consolidated warehouses that were scattered around Japan. This enabled us toachieve a reduction of intra-company transportation and more efficient transportation of collected cargo, and to
reduce the impact on the environment. Our next environmental measures include the increase of combined
shipments grouping products shipped to the same destination and reduction of the transportation routes notheading directly to the final destination.
In addition, we consolidated our logistics bases into two in Aichi, where our four factories are located andstreamlined warehouses spread around Japan. This eliminated redundant inventory at logistic centers, theproduction that is neither urgent nor important, and so called “horizontal transportation”*. Moreover, improved
logistics efficiency contributed to cost reduction and minimization of environmental burden. Our next measures
include the following two: to increase combined shipments grouping products shipped to the same destination;and to reduce the transportation routes that are not directly heading to the final destination.

Trend of shipping volume and CO2 emission
Fiscal year ended March 31

Shipping volume(ton x km)
CO2 emission volume(TCO2 )

Fiscal
2009

Fiscal
2010

Fiscal
2011

Fiscal
2012

Fiscal
2013

Fiscal
2014

6,519

6,483

6,333

6,687

6,587

6,836

10,013

9,901

9,837

10,23810,44010,967*”Horizontal transportation”: transportation that doesn’t include final destination (customer site), such as the route between Rinnai
factory and its warehouse110

CSR Report 2014│With Our Communities and SocietyWith Our Communities and Society
We actively, voluntarily and continuously engage in a wide range of activities aimed at contributing to society
throughout the Rinnai Group. We carry out activities in close cooperation with local communities all over the world.

In Touch with the Community
Trail Running for Charity
Employees from Rinnai UK Ltd. and members of theirfamilies took part in a charity 7.5-mile trial running
event in the UK, sponsored by Ronald McDonald
House Charities, a non-profit organization run by
McDonald’s. Funds raised as part of the event were
donated to Hospital Hospitality House, which helps
families with children undergoing advanced medical
treatment in locations far away from their loved ones.

House Building Support Activities
Rinnai America Corporation has been providing support for activities
carried out by Habitat for Humanity, a non-profit organization thatbuilds houses and assists with repairs, ever since 2006. Following on
from last year, the company once again donated tankless(instantaneous) water heaters. Employees also helped build houses aspart of onsite volunteer activities.

Support for the Restoration of the Nakagawa Canal
The Nakagawa Canal that runs near our headquarters used to be alive as a transportation route for foreign ships
connecting the Port of Nagoya and the center of Nagoya city. With the development of transportation by railroads
and automobiles, the utilization of canal transportation diminished greatly. Since the 80th anniversary of the
opening of the canal in 2010, “The Nakagawa Canal Art” and a range of other artistic events have taken place every
year, with the aim of restoring the Nakagawa Canal as the new core of Nagoya city.
Based around the theme “Nakagawa Canal of the Future”, events took place in warehouses along thebanks of the canal, incorporating music, dance, paintings, food and various other elements. Events on the canal
itself included balloon art and images displayed using projectors.

Images projected above the canal

Violin recital by a local music school

Balloon art on the canal111

CSR Report 2014│With Our Communities and Society

Nakagawa Canal Restoration & Cultural/Artistic Activity Assistance ProjectThis is a project based on guidelines issued by the City of Nagoya and the
Nagoya Port Authority, as part of plans for the restoration of the Nakagawa
Canal. Nagoya Urban Institute (Nagoya Urban Development Public Corporation)is aiming to assist with cultural and artistic activities designed to provide ongoingsupport for interactive and creative activities in the “Nigiwai Zone (BustlingZone)” as part of the restoration plan.

Nakagawa Lifelong Learning Center Class at Rinnai Head Office
In November 2013, we hosted a class organized by the Nakagawa Lifelong Learning Center at our Head Office.
Based on the theme of pioneering and leading Japanese manufacturing originating from Nakagawa, the class was
designed to teach local people about industrial heritage and the current state of industry by learning about thecompany’s history.
Participants went round the history corner on the 1st floor and our showroom on the 2nd floor, to givethem a better understanding of Rinnai by looking back at our history and getting a feel for actual products. The
class also included a talk about manufacturing originating from the Nakagawa area, tracing the company’s history
from its establishment to the present day.

History corner on the 1st floor

Talk tracing the history of Rinnai fromits establishment to the present day

Reprint of a product catalog
distributed by Rinnai during the 1920s

Visiting an Elderly Welfare Facility
In November 2013, employees from Rinnai Brasil Heating Technology Ltd. visited
Pro+Vida, a welfare facility for the elderly in Mogi das Cruzes. They donated adultdiapers, along with food, clothing and other items collected from members of staff,
as well as enjoying interacting and talking to elderly residents at the facility.

Volunteer Activities for 18th Environment Day
In June 2013, Rinnai Korea Corporation took part in volunteer activities in frontof Bupyeong District Office in Incheon, South Korea. Volunteer activities
formed part of the local government’s 18th Environment Day, aimed at showing
the public that there are various ways of reusing materials. In front of the district
office, companies provided imaginatively made flowers, expressing their own
unique ways of reusing unwanted items. Rinnai Korea turned tabletop cookers
that were due for disposal into attractive flowerbeds, bringing a touch of color to
the front of the district office.
112

CSR Report 2014│With Our Communities and Society

Communicating with Students
Factory Tours for Students
To encourage interaction with the local community, each factory provides cooperation for a factory tour program
for local elementary school students. Schools utilizes this program as an opportunity for students to learn aboutsociety and monozukuri through the presentation of facilities in production lines, assembly method and products.

Seto Factory

Factory Tour for Overseas Delegation
The town of Oguchi, in the Niwa area of Aichi prefecture, is home to ourTechnology Development Center, where we carry out research and development,
and also our Oguchi Factory, which serves as our core factory for kitchen
appliances. An overseas delegation of students from Oguchi Town visited Rinnai
New Zealand Ltd. and went on a factory tour.

Support for Sports and Culture
The Group supports events that foster international exchange in the arts and culture as well as sporting events.

Rinnai Corporation, Actual Results in Fiscal 2014

Major financial contributions and sponsorships* Chubu High-tech Center (CHC)* Nagoya Urban Development Public Corporation (support for restoration project on the Nakagawa Canal)* Japan Academy of Chamber Music* Yakushiji Temple (support for the preservation of Toto tower as a national treasure)* Society for the Preservation of Tadasu-no-Mori Forest at Kamomioya Shrine World Heritage Site
* Japan Virtuoso Symphony Orchestra Concert* Nagoya Philharmonic Orchestra* Nagoya School of Music, The Music Competition of Japan, Award-winning Celebration Concert* Campus Venture Grand Prix, Chubu Area
* Nagoya Shonen Shojo Hatsumei Club (Invention and Innovation Youth Club)* Nippon Domannaka Festival* National Abilympics (National Skills Competition) – Aichi* Jazz for Kids in Nakagawa* Haruhime Dochu (Spring Queen Parade) at Nagoya Castle Culture Forum

113

CSR Report 2014│With Our Communities and Society

Rinnai POPS Orchestra Program“Rinnai POPS Orchestra” operated by Rinnai Korea Corporation, isthe only one private orchestra in Korea. It was established in 1986 forthe emotional development in the youth, the contribution for thegrowth of culture in the local community and the improvement of thelevel of culture of the nation. The orchestra provides charity concerts
including a regular concert and concert trip visiting various sites
based on requests and invitation. In 2013, the orchestra held 35
concerts.

Our Employee’s Voluntary Activities
Participation in Environmental Beautification Activities
Each location of the Rinnai Group promotes local environmental beautification activities such as the cleaning of
the company vicinity and commuting routes of the employees. Our activities are deeply rooted in each
community.

From the left: activities around RB Controls Co., Ltd., Rinnai Corporation, and Japan Ceramics Co., Ltd.

114

CSR Report 2014│Supplemental Data 1

Oguchi Factory
Location
Number of employees
Business
Land area
Total floor space
Commenced operations:
Acquisition of ISO14001
certification:

Kaechi, Oguchi-cho, Niwa-gun, Aichi
904 (as of March 31, 2014)
Manufacture of gas equipment
48,352 ㎡
37,093 ㎡
1964
October 1997

Major production items

Gas tabletop cookers

Gas built-in stoves

Built-in ranges Dishwashers and others

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas
(t)

441.7

67.8

6.4

Other fuels(kl)(crude oil equivalent)
29.1

Emissions into the air
CO2 emissions(t-CO2)
3,254

NOx emissions
(t)
2.6

1999

2010 20122013 2014(FY)

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)5,090.9

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

5,090.9

100.0

Substances subject to the PRTR law*

Number

53
80
296
300
309
405

Class I designated chemical
substance name

Ethylbenzene
Xylene1,2,4-trimethylbenzene
TolueneNickel compounds
Boron compounds(Unit: kg)

a. Emissions
into the air

1,200.0
1,300.0
1,400.0
910.0
0.0
0.0

Amount of emission/discharge
b. Discharge c. Discharge
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0
0.0
0.0

Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)
0.0
0.1
0.0
0.0
1.9
2.2

24.0
42.0
0
170.0
69.0
280.0

*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Oguchi Factory 1

CSR Report 2014│Supplemental Data 1

Air
Equipment
Baking furnace
BoilerSubstance
Soot and dust
NOx
Soot and dust
NOx

National
0.25
180
0.10
150

Regulation value
Prefectural
Voluntary
0.25
0.16
180
150
0.30
0.08
150
96

Actual
value
0.001
84.5
0.002
59.3

■

■

Units of regulation values
Soot and dust: g/m3N
NOx: ppm
Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Water discharge
Substance
Amount of discharge
pH
BOD
SS
n-Hex mineral oil
n-Hex vegetable oil
CopperZinc
Soluble ironSoluble manganese
NitrogenPhosphorus
Iodine consumption

National‒
5.7 - 8.7
300
300
5
30
3
2
10
10
150
20
220

Regulation value
Municipal Voluntary‒‒
5.7 - 8.7
5.8 - 8.7
300
240
300
240
5
4
30
24
3
2.4
2
1.6
10
8
10
8
150
120
20
16
220
176

Maximum
468.0
7.7
220.0
100.0
<1
13.0
0.09
0.60
0.28
0.05
48.0
6.0
17.0

Actual value
Minimum
14.0
7.1
45.0
25.0
<1
2.0
0.03
0.05
0.07
0.01
20.0
1.7
3.0

Mean
120.0
7.3
111.1
66.0
<1
6.5
0.05
0.18
0.16
0.02
31.6
3.2
8.3

■ The unit of the amount ofdischarge is m3/day■ The values are expressed in mg/L
except for pH■ Water discharge standard:
Sewer discharge standard* pH:
Concentration of hydrogen
ions* BOD: Biochemical oxygen
demand* SS:
Concentration of aqueous
suspended solids* N.D.: Equal to or less than theminimum determination
limit (undetectable)* Values in parentheses are daily mean values.

Environmental Initiatives
Energy saving initiatives
Enameled metalware firing furnaces heat a number of tube burners toapproximately 1,200˚C and then transfer the resulting heat to the inside of
the furnace. By reducing the thickness of tube burners and increasingtransfer efficiency, we have shortened the time taken to reach set
temperatures inside our furnaces by transferring heat more efficiently. We
have also significantly reduced the amount of fuel required to maintainfurnace temperatures.
Reduction in gas consumption:

Approx. 11,400 m3/year

Reduction in CO2 emissions:

Approx. 25tons-CO2 /year

Maintenance work

Energy/resource saving initiatives
We have reduced water consumption from coating equipment through initiatives such as upgrading to nozzles
with superior cleaning performance, continuously reviewing piping and drainage channels for wastewater, andreusing discharged water.
Reduction in water consumption:

Approx. 800 m3/year

Oguchi Factory 2

CSR Report 2014│Supplemental Data 2

Seto Factory
Location
Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001 certification

Anada-cho, Seto-shi, Aichi
809 (as of March 31, 2014)
Manufacture of gas equipment
42,649 ㎡
27,351 ㎡
1979
December 2000

Major production items

Hybrid water heater withheating system

Heating sourcefor gas water heaterandGas waterheaters

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas
(t)

682.7

70.8

30.2

Other fuels(kl)(crude oil equivalent)
17.5

Emissions into the air
CO2 emissions(t-CO2)
4,274

NOx emissions
(t)
3.4
1999

2010 20122013 2014(FY)

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)2,406.3

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

2,406.3

100.0

Substances subject to the PRTR law

Number

53
80
87
300
308

Class I designated chemical
substance name

Ethylbenzene
XyleneChromium and chromium (III)compounds
TolueneNickelAmount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
1,000.0
0.0
0.0
1,300.0
1.6
0.0

d. Landfill
at therelevant
office(Unit: kg)
Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)

0.0
0.0

0.0
0.0

100.0
100.0

0.0

0.0

0.0

0.0

0.0

0.0

680.0
0.0

0.0
0.0

0.0
0.0

0.0
0.0

0.0
0.0

360.0
0.0

*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Seto Factory 1

CSR Report 2014│Supplemental Data 2

Air
Equipment
BoilerSubstance

National
0.1
150

Soot and dust
NOxRegulation value*1
Prefectural
Voluntary
0.3
0.05
150
79

Actualvalue*2
0.02
24.8*1 Units of regulation values
Soot and dust: g/m3N
NOx: ppm*2 Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Water discharge
Substance
Amount ofdischarge
pH
BOD
COD
SS
n-Hex mineral oil
n-Hex vegetable oil
CopperZinc
Soluble ironSoluble manganese
NitrogenPhosphorus

National

Regulation value
Prefectural Voluntary

Maximum

Actual value
Minimum

Mean

‒

‒

‒

68.0

25.0

44.0

5.8 - 8.6
160 (120)
160 (120)
200 (150)
5
30
3
2
10
10
120 (60)
16 (8)

5.8 - 8.6
25 (20)25 (20)30 (20)
2
10
1
2
10
10
120 (60)
16 (8)

6.0 - 8.4
20
20
20
1.6
8
0.5
1
2.5
2.5
30
4

7.9
3.3
3.7
2.0
< 0.5
< 0.5
0.03
0.6
0.1
N.D.
13.0
1.1

7.1
< 0.5
1.0
<1
< 0.5
< 0.5
0.01
N.D.
N.D.
N.D.
0.2
0.02

7.5
0.9
2.1
0.2
< 0.5
< 0.5
0.02
0.08
N.D.
N.D.
4.2
0.3

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:River effluent standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* COD: Chemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Environmental Initiatives
Energy saving initiatives
We have ceased using Cooling Tower 1, which had previously been used to cool the entire area, and installed
individual coolers for each line. Even if cooling water changes temperature by just one degree, it still has aneffect. By scaling back and installing dedicated equipment however, we have been able to minimize the risk ofthat happening and eliminate wasted energy.
Reduction in power consumption:

Approx. 12,000 kWh/year

Reduction in CO2 emissions:

Approx. 4.6 tons-CO2/year

Communicating with local communities
We organize factory tours for local elementary school students and explain to them how the water heaters they
use at home work.

Students being shown round a
production line

Explaining how water heaters work

Seto Factory 2

CSR Report 2014│Supplemental Data 3

Asahi Factory
Location
Number of employees
Business
Land area
Total floor space
Production started
Acquisition of ISO14001 certification

Nishiyama-cho, Owariasahi-shi, Aichi
270 (as March 31, 2014)
Manufacture of gas equipment
17,772 ㎡
7,619 ㎡
1960
November 2003

Major production items

Gas fan heaters

Gas clothes
dryersBathroom
heaters/dryers

Fan-forced
gas heaters

Infrared heaters
and others

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas
(t)

149.3

18.9

2.4

Other fuels(kl)(crude oil equivalent)
4.8

Emissions into the air
CO2 emissions(t-CO2)999

NOx emissions
(t)
0.8

1999

2010 20122013 2014(FY)

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

558.9

0.0

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

558.9

100.0

Substances subject to the PRTR law*

Number

53
80
296
300

Class I designated chemical
substance name

Ethylbenzene
Xylene1,2,4-trimethylbenzene
Toluenea. Emissions
into the air

640.0
710.0
150.0
1,900.0

Amount of emission/discharge
b. Discharge c. Discharge
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0

(Unit: kg)
Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)
6.0
6.0
6.0
6.0

1,200.0
1,200.0260.0
4,800.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Asahi Factory 1

CSR Report 2014│Supplemental Data 3

Air
Equipment

Substance

Drying furnaces

Soot and dust
NOxRegulation value*1
Prefectural
Voluntary
‒
0.108
‒
200

National
0.2
230Actualvalue*2
0.035
21.5■Units of regulation values
Soot and dust: g/m3N
NOx: ppm■Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Water discharge
Substance
Amount of discharge
pH
BOD
SS
n-Hex mineral oil
n-Hex vegetable oil
CopperZinc
Soluble ironSoluble manganese
NitrogenPhosphorus
Iodine consumption

National‒
5.7 - 8.7
300
300
5
30
3
2
10
10
240
32
220

Regulation value
Municipal Voluntary‒‒
5.7 - 8.7
5.9 - 8.5
300
210
300
210
5
3.5
30
21
3
2.1
2
1.4
10
7
10
7
240
168
32
22.4
220
154

Maximum
64.0
7.3
160.0
120.0
2.20
13.5
N.D.
0.35
0.60
N.D.
47.0
4.0
91.0

Actual value
Minimum
19.0
7.0
67.0
12.0
< 0.5
2.0
N.D.
0.15
0.20
N.D.
27.0
2.4
15.0

Mean
35.3
7.1
106.3
41.2
0.8
5.2
N.D.
0.23
0.38
N.D.
38.9
3.6
45.8

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:
Sewer discharge standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Environmental Initiatives
Waste initiatives
We are working to improve the quality of our recycling activities in order toreduce the amount of waste that we produce. We have introduced amaterial recycling system whereby we separate and recover polypropylene(PP) contained in waste plastic, and then reuse it as a raw material.
Separating and recovering materials

Communicating with local communities

We organize factory tours for local elementary school students, as part of their social studies. We explain tothem how the fan heaters they use on a daily basis actually work, and show them products being assembled on
the shop floor.

Explaining how fan heaters work

Students being shown round individual production lines

Our employees regularly take part in cleanup activities along commuting routes, in the area surrounding thefactory and in nearby parks.

Cleanup activities in the areasurrounding the factory

Cleanup activities in a nearby park

Asahi Factory 2

CSR Report 2014│Supplemental Data 4

Yanagisawa Manufacturing Co., Ltd.
Location
Number of employees
Business
Land area
Total floor space
Commenced operations

Yanagi-machi, Kadoma-shi, Osaka
365 (as March 31, 2014)
Manufacture of gas equipment
20,098 ㎡
19,314 ㎡
1936
June 2004

Acquisition of ISO14001 certification

Major production items

Commercial-use
high-speed ovens

Commercial-use
kitchen units

Gas rice cookers

Floor heating systems(hot-water mat)

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas
(t)

191.1

34.9

0.1

Other fuels(kl)(crude oil equivalent)
6.1

Emissions into the air
CO2 emissions(t-CO2)
1,507

NOx emissions(t)1.2Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

596.2

0.0

Equipment

Substance

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

596.2

100.0

Air

BoilerDrying furnaces

Soot and dust
NOx
Soot and dust

National
0.15
150
0.15

Regulation value*1
Prefectural
Voluntary
0.10
0.10
150
150
0.10
0.10

Actualvalue*2
0.003
37
0.002

■Units of regulation values
Soot and dust: g/m3N
NOx: ppm■Actual values for NOx and soot/dust indicate
the maximum measurements versus theregulation values for the relevant type ofequipment.

Water discharge
Substance
Amount of discharge
pH
BOD
SS
n-Hex mineral oil
n-Hex vegetable oil
CopperZinc
Soluble ironSoluble manganese
NitrogenPhosphorus

National‒
5.0 - 9.0
600
600
5
30
3
2
10
10
240
32

Regulation value
Municipal Voluntary‒‒
5.0 - 9.0
5.9 - 8.5
600
300
600
300
5
5
30
24
3
3
2
2
10
3
10
10
240
120
32
30

Maximum
125.0
8.5
88.0
21.2
3.6
22.7
<0.1
0.89
<0.1
<0.1
34
9.6

Actual value
Minimum
51.5
7.0
3.5
2.0
1.0
1.2
<0.1
0.02
<0.1
<0.1
14
0.8

Mean
95.1
7.6
36.5
11.3
1.4
8.4
<0.1
0.33
<0.1
<0.1
24
4.7

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:
Sewer discharge standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Yanagisawa Manufacturing Co., Ltd. 1

CSR Report 2014│Supplemental Data 4

Environmental Initiatives
Environmental Initiatives
We carry out regular environmental patrols to eliminate air leaks.

Resource saving initiatives
We carry out environmental preservation activities as part of coating processes at the factory. As a result, wehave managed to save a considerable amount of water and have reduced the volume of chemicals we use forwastewater treatment.
Example initiatives- Changing water supply methods for factory pre-coating treatment processes- Installing chemical recirculation and filtration systems in tanks- Regularly checking for leaks from pumps, carrying out repairs in-house, etc.

Water supply

Pre-coating treatment(filtration system)

Monitoring water consumption(water meter)

Reduction in in water consumption: Approx. 7,000m3/year
Reduction in in waste:

Approx. 20 tons/year

Communicating with local communities
Our employees regularly take part in cleanup activities along commuting routes and in the area surrounding thefactory.

Employee cleanup operations

Cleanup activities along commuting routes

Yanagisawa Manufacturing Co., Ltd. 2

CSR Report 2014│Supplemental Data 5

Rinnai Technica Co., Ltd.
Location
Number of employees
Business
Land area
Total floor space
Commenced operations

Sakagawa, Kakegawa-shi, Shizuoka
533 (as of March 31, 2014)
Manufacture of gas equipment
41,239 ㎡
10,775 ㎡
1910
December 2003

Acquisition of ISO14001 certification

Major production items:

Gas waterheaters

Gas instant-heating
hot-water heaters

Gas water heaters
for overseas market

Heat exchanger
and others

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)LP gas
(t)

269.6

446.1

Other fuels(kl)(crude oil equivalent)
24.3

Emissions into the air
CO2 emissions(t-CO2)
2,418

NOx emissions(t)
2.2

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

965.0

0.9

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

964.2

99.9

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS

National‒
5.8 - 8.6
160
(120)
160
(120)
200
(150)

Regulation value
Prefectural Voluntary‒‒‒
6.3 - 8.1

Maximum
94.0
7.7

Actual value
Minimum
6.0
7.1

Mean
39.9
7.4

25 (20)20 (15)

8.4

0.7

4.3

‒

20 (15)

7.5

3.4

5.5

50 (40)30 (20)

3.7

< 2.0

2.4

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:River effluent standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* COD: Chemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Rinnai Technica Co., Ltd. 1

CSR Report 2014│Supplemental Data 5

Environmental Initiatives
Energy saving initiatives
We have reduced energy consumption by upgrading to energy saving lightfittings (fluorescents, LEDs), and reviewing the number of lights we needand their capacity.
Reduction in power consumption:

Approx. 5,800 kWh/year

Reduction in CO2 emissions:

Approx. 2 tons-CO2/year
Air compressor
Upgraded fluorescent lights

Following on from Factory 2 the previous year, this year we applied heatshield coating to the roof of Factory 1. This has helped prevent temperaturesinside the factory from rising due to the surface temperature of the roof
during the summer, and has also helped reduce strain on air conditioning
systems (= energy consumption).
Reduction in power consumption:

Approx. 44,000 kWh/year

Reduction in CO2 emissions:

Approx. 17 tons-CO2/year
Area of the roof coated(corrugated panels on Factory 1)

Communicating with local communities
We regularly pick up litter in the areas around Kakegawa Station and Kakegawa Castle, as part of the “Small
Kindness” movement.
Total participants to date: 40

Group photo of participants

Cleanup activities

Rinnai Technica Co., Ltd. 2

CSR Report 2014│Supplemental Data 6

RB Controls Co., Ltd.

Location

Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001
certification

Head office:Kannondo-machi, Kanazawa-shi, Ishikawa
Kanaiwa Factory:
Kanaiwa Higashi, Kanazawa-shi, Ishikawa
Tsurugi Factory:
Oyanagi-machi, Hakusan-shi, Ishikawa
707 (as of March 31, 2014)
Manufacture of gas equipment components
Head office:3,691㎡, Kanaiwa:3,292㎡, Tsurugi: 17,636㎡,
Head office:2,892㎡, Kanaiwa:5,809㎡, Tsurugi: 10,495㎡,
1971
March 2006

Head office

Major production items

Electronic
control units

Kanaiwa
FactoryHigh voltage
units

Bathroomwaterproof TV

Tsurugi
Factory

Bathroom LED
lightsData on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas
(t)

528.3

2.2

278.1

Other fuels(kl)(crude oil equivalent)
25.0

Emissions into the air
CO2 emissions(t-CO2)
2,943

NOx emissions(t)
2.6

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

371.8

13.5

Amount ofintermediate
processing of waste(t)
4.6

Amount of recycled
waste
(t)

Recycling
percentage
(%)

353.8

95.1

Substances subject to the PRTR law*
Kanaiwa Factory

NumberClass I designated chemical
substance name31
186

Antimony and its compounds
Methylene dichloride
Tetrahydromethylphthalicanhydride
Methylenebis (4,1-phenylene)
diisocyanate
Tritolyl phosphate

265
448
460

Amount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0
0.0
0.0
0.0

d. Landfill
at therelevant
office(Unit: kg)
Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)

0.0
0.0

0.0
0.0

3,000.0
2,200.0

0.0

0.0

0.0

0.0

0.0

20,000.0

0.0

0.0

0.0

0.0

0.0

3,700.0

0.0

0.0

0.0

0.0

0.0

1,600.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

RB Controls Co., Ltd. 1

CSR Report 2014│Supplemental Data 6

Substances subject to the PRTR law*
Tsurugi Factory

Number

186
448
460

Class I designated chemical
substance nameMethylene dichloride
Methylenebis (4,1-phenylene)
diisocyanate
Tritolyl phosphate

Amount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0

d. Landfill
at therelevant
office(Unit: kg)
Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)

0.0

0.0

3,000.0

0.0

0.0

0.0

0.0

0.0

4,100.0

0.0

0.0

0.0

0.0

0.0

56,000.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Environmental Initiatives
Environmental awareness initiatives
Having created our own unique environmental characters to represent RB Controls Co., Ltd. called the Happies(based on the Japanese character for “leaf”), we intend to use them as an accessible symbol of our eco-friendly
initiatives as we strive to promote environmental activities. We have also introduced an environmental
improvement suggestion scheme in the workplace and have presented awards to the best examples, in an effort
to step up our activities even further.
(*) Origin of the Happies: Created from a combination of the company name (“RBC”) and the image of a leaf, the Happies
walk around to symbolize the gradual journey towards a more environmentally friendly future.

Increasing greeneryin the workplace

Our own unique characters
the Happies

Notice board

Energy saving initiatives
We have installed fans on air conditioning units in an effort to reduce differences intemperature throughout each room and provide an even cool breeze. By rolling out
this initiative to each of our factories, we have managed to control set temperaturesand reduce energy consumption during the summer by approximately 6% comparedto the previous year.
Reduction in gas consumption:

Approx. 1,200 m3/year

Reduction in CO2 emissions:

Approx. 3 tons-CO2/year

Fan installation

RB Controls Co., Ltd. 2

CSR Report 2014│Supplemental Data 6

Communicating with local communities
22 employees took part in “Clean
Beach Ishikawa”, an event organized
by FM Ishikawa along the Kanaiwa
coast in Kanazawa.

Cleanup activities

Collected litter

Environmentally friendly product development (bathroom LED lighting)In the wall lighting market, within which we have a 90% share of system bathlighting, we have successfully developed and are working to promote integrated
LED products that combine both light source and power supply. The design
focuses particularly on waterproofing, in order to overcome issues with LED
lighting such as vulnerability to moisture and short-circuiting. In fact the productin question won a Good Design Award in 2013.
Reduction in CO2 emissions/1 light: Approx. 135 kg-CO2/10year **Reduction based on the assumption that bathroom lighting is used for two hours a
day over the course of ten years
Bathroom LED wall lights

RB Controls Co., Ltd. 3

CSR Report 2014│Supplemental Data 7

Rinnai Precision Co., Ltd.
Head office and Komaki Factory:
Shimobata, Oaza Honjo, Komaki-shi,
Aichi
Kani Factory: Himegaoka, Kani-shi, Gifu
626 (as of the end of March 2014)
Manufacture of gas equipment components
Head office and Komaki Factory:20,303㎡,
Kani Factory: 10,341㎡,
Head office and Komaki Factory:20,202㎡,
Kani Factory: 5,944㎡,
1979
December 2005

Location
Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001
certification

Head office andKomaki Factory

Major production items:

Gas cock parts

Kani Factory

Gas valve parts

Gas control units

Solenoid water
valve and others

Data on Environmental Load by Site (Total amounts of Head office, Komaki Factory and Kani Factory)
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas(t)

1,290.0

130.8

79.5

Other fuels(kl)(crude oil equivalent)
81.5

Emissions into the air
CO2 emissions(t-CO2)8,176

NOx emissions(t)
6.5

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)1,740.2

2.8

Amount ofintermediate
processing of waste(t)
1.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

1,736.4

99.8

Water discharge
Head office, Komaki Factory
Substance
Amount of discharge
pH
BOD
COD
SS

Regulation value
National Prefectural Voluntary‒‒‒
5.8 - 8.6‒
6.0 - 8.4
160 (120)
25 (20)25 (20)160 (120)
25 (20)25 (20)200 (150)‒
25 (20)

Actual value
Maximum Minimum
32.0
5.0
8.0
6.8
‒
‒
17.0
4.0
‒
‒

Mean
25.0
7.5
2.0
12.0
1.0

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:River effluent standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* COD: Chemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Rinnai Precision Co., Ltd. 1

CSR Report 2014│Supplemental Data 7

Kani Factory
Substance
Amount of discharge
pH
BOD
COD
SS

Regulation value
WrittenVoluntary
agreement‒‒‒
5.8 - 8.6
5.8 - 8.6
5.8 - 8.6
160 (120)1515
160 (120)30
30
200 (150)30
30
National

Maximum

Actual value
Minimum

Mean

356
7.1
13.0
‒
2.0

155
6.4
1.4
‒
1.0

281
6.8
4.2
4.3
1.1

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:River effluent standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* COD: Chemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Environmental Initiatives
Energy saving initiatives
Making improvements to air compressors-Shutting down air consumption overnight and using timer controls to automatically start up again
Reduction in power consumption:

Approx. 45,000 kWh/year

Reduction in CO2 emissions:

Approx. 17 tons-CO2/year-Optimizing operations (reviewing operating sequences at low load)
Reduction in power consumption:

Approx. 170,000 kWh/year

Reduction in CO2 emissions:

Approx. 63 tons-CO2/year

Timer
controls
Compressor

Melting furnaces account for approximately 50% of all energy consumption at the Komaki Factory. By installing
pinpoint compact heaters to supply auxiliary heat at uptake points for melted aluminum, we have eliminated theneed to excessively heat melted aluminum as a whole, which has helped to reduce energy consumption.
Reduction in gas consumption:

Approx. 3,000 m3/year

Reduction in CO2 emissions:

Approx. 7 tons-CO2/year

Communicating with local communities
We organized an environmental seminar for the Kani Industrial Park
Union, on the subject of “preventive environmental management based on
lessons learnt from issues with wastewater treatment.”-Participating companies: 53

Seminar in progress

Rinnai Precision Co., Ltd. 2

CSR Report 2014│Supplemental Data 8

RT Engineering Co., Ltd.
Location
Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001 certification

Kamiike-cho, Toyota-shi, Aichi
190 (as of March 31, 2014)
Manufacture of gas equipment andcomponents
12,199 ㎡
7,026 ㎡
1950
March 2006

Major production items

Copper pipe/press components

Grill components
and others

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas(10,000 m3)

LP gas
(t)

198.8

14.4

3.2

Other fuels(kl)(crude oil equivalent)
17.8

Emissions into the air
CO2 emissions(t-CO2)
1,123

NOx emissions(t)
0.9

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

807.3

3.5

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

803.8

99.6

Water discharge
Substance
Amount of discharge
pH
BOD
SS
n-Hex mineral oil
NitrogenPhosphorus

Regulation value
National
Municipal Voluntary‒‒‒
5.0 - 9.0
5.7 - 8.7
5.7 - 8.7
600
300
300
600
300
300
5
5
5
240
150
150
32
20
14

Actual value
Maximum Minimum
22.0
20
7.3
6.3
6.6
0.5
6
<1
1.9
< 0.5
2.2
1.2
4.70
0.02

Mean
21.0
7.0
2.0
2
0.8
1.7
0.90

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:
Sewer discharge standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

RT Engineering Co., Ltd. 1

CSR Report 2014│Supplemental Data 8

Environmental Initiatives
Energy saving initiatives
We have reduced energy consumption by upgrading from existing mercury
lamps to high efficiency lamps (in combination with ultra-high performancereflective sheets and long-life lamps).
Reduction in electricity consumption:

Approx. 2,700 kWh/year

Reduction in CO2 emissions:

Approx. 1 ton-CO2/year
Warehouse (High efficiency lamps)

Environmental awareness initiatives
To effectively carry out environmental activities, it is important to raise
environmental awareness (improve eco-mindedness) on an individual level.
That is why we provide environmentally themed education as part oftraining for new recruits and at other available opportunities.

Environmental training for new recruits

Communicating with local communities
Our employees carry out regular cleanup activities along commuting routes and in the area surrounding thefactory. (Number of participants: 11/year)

Cleanup activities along commuting routes

Cleanup activities in the surrounding area

RT Engineering Co., Ltd. 2

CSR Report 2014│Supplemental Data 9Japan Ceramics Co., Ltd.
Location
Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001 certification

Himegaoka, Kani-shi, Gifu
84 (as of March 31, 2014)
Manufacture of gas equipment components
8,030 ㎡
5,756 ㎡
1981
January 2006

Major production items

Ceramic plates
for burners

Industrial burners

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)LP gas
(t)

125.9

461.7

Other fuels(kl)(crude oil equivalent)
3.9

Emissions into the air
CO2 emissions(t-CO2)
1,871

NOx emissions(t)
1.7

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill
(t)

254.5

73.3

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage
(%)

181.2

71.2

Substances subject to the PRTR law*

NumberClass I designated chemical
substance name

53
80
300
412

Ethylbenzene
XyleneTolueneManganese and its compounds

a. Emissions
into the air

2,000.02,800.0
12,000.0
0.0

Amount of emission/discharge
b. Discharge c. Discharge
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0
0.0
1.0
0.0
0.0
0.0

d. Landfill
at therelevant
office

0.0
0.0
0.0
0.0

(Unit: kg)
Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)
0.0
0.0
0.0
0.0

500.0
570.0
1,700.01,800.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.
Air
Equipment

Substance

Baking furnace

Soot and dust
NOx
SOx

National
0.2
400
0.49

Regulation value*1
Prefectural
Voluntary
0.125
0.125
90
90
0.25
0.25

Actualvalue*2
0.002
14
0.02

■ Units of regulation values
Soot and dust: g/m3N
NOx: ppm
Sox: m3N/h■ Actual values for NOx, Sox, and soot/dust
indicate the maximum measurements versus
the regulation values for the relevant type ofequipment.

Japan Ceramics Co., Ltd. 1

CSR Report 2014│Supplemental Data 9

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS

Regulation value
National
WrittenVoluntary
agreement‒‒‒
5.8 - 8.6
5.8 - 8.6
5.8 - 8.6
160 (120)
15 (10)15160 (120)‒30
200 (150)
30 (25)30

Actual value
Maximum Minimum
6.9
7.9
4.5
0.1
18.0

Mean

4.6
6.8
0.7
0.1
2.0

5.4
7.2
2.3
0.1
9.7

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:River effluent standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* COD: Chemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Environmental Initiatives
Energy saving initiatives
Green curtain initiative
We create “green curtains”*1 every year, planting bitter gourds and otherclimbing plants to create natural curtains that keep the inside of buildingscool. The fruit that is harvested is distributed to employees and their family
members to enhance social exchanges. To help these plants grow, we use
ceramic balls we developed and other materials to improve the drainage.
[Seedlings] Sweet potatoes*1 Plants suck up water from their roots and release it from their leaves in the form ofvapor. This is called transpiration. We feel cooler near plants because this vapor
draws in the surrounding heat.

Tending to a green curtain

Communicating with local communities
We participate in local cleanup activities along the Kani River. Our staff members regularly conduct cleanup
activities along commuting routes and the area surrounding the factory.
(A total of 51 staff members have participated in these activities.)

Cleanup activities along the Kani River

Cleanup activities along commuting routes

We have also installed planters so that volunteers can grow plants onsite.

Installing planters

Japan Ceramics Co., Ltd. 2

CSR Report 2014│Supplemental Data 10

Noto Tech Co., Ltd.
Location
Number of employees
Business
Land area
Total floor space
Commenced operations
Acquisition of ISO14001 certification

Nakanoto-machi, Kashima-gun, Ishikawa
197 (as of March 31, 2014)
Manufacture of gas equipment components
23,152 ㎡
13,773 ㎡
1990
January 2007

Major production items

Gloss enamel

Enamel components

Resin components

Rice cooker

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)LP gas
(t)

247.4

922.5

Other fuels(kl)(crude oil equivalent)
116.8

Emissions into the air
CO2 emissions(t-CO2)
4,005

NOx emissions(t)
3.6

Discharge of waste
Amount of waste
generated(t)

Amount of waste
into landfill(t)2,413.6414.6

Amount ofintermediate
processing of waste(t)
0.0

Amount of recycled
waste
(t)

Recycling
percentage(%)

1,999.0

82.8

Substances subject to the PRTR law*

Number

31
71
80
265
296
309
405
412

Class I designated chemical
substance name

Antimony and its compounds
Ferric chloride
XyleneTetrahydromethylphthalicanhydride
1,2,4-trimethylbenzene
Nickel compounds
Boron compounds
Manganese and its compounds

Amount of emission/discharge
a. Emissions b. Discharge c. Discharge
into the air
into public
into the soil
watersat therelevant
office(except d.)
0.0
0.0
0.0
0.0
0.0
0.0
5.8
0.0
0.0

d. Landfill
at therelevant
office(Unit: kg)
Amount of transfer
a. Transfer
b. Transfer
to sewers
outside therelevant
office(except a.)

0.0
0.0
0.0

0.0
0.0
0.0

0.0
0.0
0.0

0.0

0.0

0.0

0.0

0.0

0.0

6.7
0.0
0.0
0.0

0.0
8.0
460.0
3.0

0.0
0.0
0.0
0.0

0.0
0.0
0.0
0.0

0.0
0.0
0.0
0.0

0.0
710.0
4,000.0
270.0*The Class I Designated Chemical Substance regulated by Pollutant Release and Transfer Register (PRTR) Law.

Noto Tech Co., Ltd. 1

CSR Report 2014│Supplemental Data 10

Air
Equipment

Substance

Baking furnace

Soot and dust
NOx

National
0.25
180Regulation value*1
Prefectural
Voluntary
0.25
0.22
180
160

Actualvalue*2
0.004
33■ Units of regulation values
Soot and dust: g/m3N
NOx: ppm■ Actual values for NOx and soot/dust indicate themaximum measurements versus the regulation
values for the relevant type of equipment.

Water discharge
Substance
Amount of discharge
pH
BOD
COD
SS

Regulation value
National Prefectural Voluntary‒‒‒
5.8 - 8.6
5.8 - 8.6
6.0 - 8.2
160 (120)
80 (60)40 (30)160 (120)‒140 (100)200 (150)
30 (20)20

Actual value
Maximum Minimum
132.0
60.0
7.4
6.6
32.0
6.0
40.0
12.0
9.0
2.0

Mean
100
7.1
14.3
20.5
4.3

■ The unit of the amount of discharge is m3/day■ The values are expressed in mg/L except forpH■ Water discharge standard:River effluent standard* pH: Concentration of hydrogen ions
* BOD: Biochemical oxygen demand* COD: Chemical oxygen demand* SS: Concentration of aqueous suspended
solids* N.D.: Equal to or less than the minimum
determination limit(undetectable)* Values in parentheses are daily mean values.

Environmental Initiatives
Energy saving initiatives
We have reduced CO2 emissions by installing regenerative burners thatrecover and reuse waste heat energy, as part of upgrades to our enameled
metalware firing furnaces.
Reduction in gas consumption:

Approx. 65,000 m3/year

Reduction in CO2 emissions:

Approx. 140 tons-CO2/year
Regenerate burners

Pollution prevention initiatives
Emergency drills
We conduct emergency drills so people know what to do in case of an
accident, and are reviewing the manuals that stipulate response procedures.
In order to minimize environmental risks, we conduct equipment
inspections and take other preventive measures.

Communicating with local communities

Emergency drill

We organize factory tours for local high school students. We also offer 10-day work experience programs inwhich participants learn the basics of manufacturing as well as about how we continually pursue quality andenvironmental friendliness.
Participants: 70

Group introduction session

A tour of the manufacturing process
for gas stove components

Noto Tech Co., Ltd. 2

CSR Report 2014│Supplemental Data 11

Techno Parts Co., Ltd.
Location

Head office: Fukuzumi-cho, Nakagawa-ku, Nagoya-shi, Aichi

Ichinomiya Office: Nishiougaido Aza Toukouji, Ichinomiya-shi, Aichi
Land area: 2,003㎡, building floor space: 1,455㎡

Ida Office: Ida-cho, Owariasahi-shi, Aichi
Land area: 4,127㎡, building floor space: 2,549㎡

Akatsuki Office: Akatsuki-cho, Seto-shi, Aichi
Land area: 33,333㎡, building floor space: 3,029㎡

Komaki Office: Oaza Mitsubuchi, Komaki-shi, Aichi
Land area: 2,611㎡, building floor space: 1,776㎡

Number of employees
Business
Acquisition of Eco Action 21

Major production items

430 (as of the end of March 2014)
Assembly and processing of components of heat-energy appliance
July 2011
Components of gas equipment and home electric appliances

Data on Environmental Load by Site
Energy use
Electricity(10,000 kWh)City gas (13A)(10,000 m3)

LP gas
(t)

69.5

5.3

0.7

Other fuels(kl)(crude oil equivalent)
0.0

Emissions into the air
CO2 emissions(t-CO2)380

NOx emissions(t)
0.3

Discharge of waste
Amount of waste
generated(t)
97.4

Environmental Initiatives
Energy saving initiatives
Green curtain initiatives
As an energy-saving measure in the summer, we grow “green curtains,” which absorb carbon dioxide during
plant photosynthesis, shield the strong sunlight from coming into the office, and reduce the load on air
conditioners. [Seedling] Bitter gourds

A green curtain

Bitter gourds are harvested and distributed to employees

Techno Parts Co., Ltd. 1

CSR Report 2014│Supplemental Data 11

Installing motion sensors
We have installed motion sensors in lavatories and changing rooms to prevent the lights from staying on whenpeople forget to turn them off.

Motion sensor

Fluorescent light

Making effective use of plastic curtains
We separate areas with plastic curtains, to prevent cool or warm air from escaping.

Using plastic curtains to reduceenergy consumption

Resource saving initiatives
We use rainwater to water our plants and flowers, as well as in our cleanup activities in an effort to use water
more effectively.

Rainwater tanks

Techno Parts Co., Ltd. 2