Rinnai Report 2020 (Integrated Report)Corporate Message

Aiming for the Realization of
Healthy and Comfortable Lifestyles
and Sustainable Societies
Since its founding in 1920, the Rinnai Group has
contributed to comfortable lifestyles for people
around the world through the provision of gas stoves,water heaters and heating systems.

At present, the Rinnai Group has bases in 18
countries and regions, and deploys products in over
80 countries throughout the world. Rinnai offers
optimal solutions suitable for lifestyle cultures, climate
conditions and energy requirements in each countryof the world to contribute to the realization of healthy
and comfortable lifestyles and sustainable societies
for people throughout the world.

01

Rinnai Report 2020 02

Corporate Mission and Vision

Rinnai Report 2020 (Integrated Report)

Fundamental Concept

Quality is our destiny

Contents

Editorial Policy
Rinnai produced this Rinnal Report 2020 (Integrated Report) to convey tostakeholders management’s approach to the realization of a sustainable
society, to describe the activities undertaken Groupwide, and to encourage a
deeper understanding of the Group’s operations to as many people as possible.

Rinnai’s Activities

Company Motto

We produce an abridged version of our Rinnal Report (Integrated Report) inbooklet form. Other examples of Company initiatives, detailed information, andrelated data—are posted in the Company Information section of our website.

Highly important activities(stakeholder perspective)

和 Harmony:
Develop personal character of the highest caliber
氣 Spirit:
Base your efforts on a consistent philosophy
眞 Sincerity:
Know the fundamentals and consider issues with
precision and clarity

Abridged version
booklet form
Rinnai Report 2020 (Integrated Report)

Rinnai Report(Integrated Report)
Website(Company Information)
Comprehensive
coverage of Group’s
CSR activities

Highly important activities(Rinnai Group perspective)

Brand Promise —Rinnai’s Corporate Mission—

Creating a healthier way of living

Scope

53 With the World’s Highest Standard forEnvironmental Performance, ECO ONE Takes
the Best of Gas and Electricity to Helpduring Disasters
55 Safe and Secure Initiatives

Referenced Guidelines

Publication Schedule
Expectations and attractiveness that
we keep promising with our customers

Rinnai Code of Conduct

Specific rules of day-to-day corporate activities

Brand PromiseSpecial Issue 02 [Quality]

Reporting Period

Spiritual support of Rinnai—Rinnai’s Corporate Mission—

25 Approaches to Preventing Global Warming
through Energy-saving Water Heaters
27 Disclosure of Environment-related Financial Data
Expressing Support for Task Force
29 Global Development of Water Heaters in the
Rinnai Group
31 Environmental Impact within Rinnai’s Value Chain
33 Environmental Initiatives

51 Taking Pride in Monozukuri (craftsmanship)

GRI Standards, ISO 26000,
Environmental Reporting Guidelines, issued by Japan’s Ministry of the Environment
Environmental Accounting Guidelines, issued by Japan’s Ministry of the Environment
IIRC, The International Integrated Reporting Framework

Company
Motto

Special Issue 01 [Environment]

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

This report focuses on events that occurred in fiscal 2020—April 1, 2019, to March
31, 2020—but also touches upon measures implemented and recent activities
undertaken since fiscal 2020 as well as future business direction, targets, and plans.

Schematic Diagram of Company Ideals

0 1 Corporate Message
03 Corporate Mission and Vision
Editorial Policy / Contents
05 Message from the President
1 1 Rinnai Group Profile
13 History Viewed from Changes in
Medium-Term Business Plans
15 Value Creation Process
17 Message from the General Manager ofCorporate Planning Headquarters
21 Rinnai Group CSR
23 Identifying CSR Material Issues

September 2020 (Japanese version)
Previous: September 2019, Next: August 2021 (planned)

Important Points Regarding Future Outlook
This report includes descriptions of earnings forecasts and outlooks for Rinnai andGroup companies.
These descriptions are based on currently available information and forecasts
as determined by Rinnai. Actual results may differ from forecasts depending on
various external factors going forward.

Special Issue 03 [Safety and Peace of Mind for Consumers]

Special Issue 04 [Health]
65 Health Effect and Efficacy of Bathing with
the Microbubble Bath Unit
67 GovernanceManagement Structure, Leadership,Compliance, Risk Management,
Rinnai Response to the Spread of COVID-19,
Information Security

79 Communication with Employees
Selected as a “2020 Health & Productivity Stock”,
Enhancement of Health Promotion Activities,
Personnel Training, Work-Life Balance,
Industrial Relations and Human Rights,
Fair and Diversified Employment,
Occupational Health and Safety

93 Communication with Stakeholders
Shareholders and Investors, Customers, Business Partners,
Local Regions and Communities,
CSR Activities Underway Across the World,
Stakeholder Engagement

103 Data Collection

03

Rinnai Report 202004

Message from the President

On Reaching the 100th Anniversary of Our Founding

Thank you for reading the Rinnai Report 2020, the Rinnai

products in more than 80 countries around the world. We

Group’s first integrated report. We have published anwould like to express our sincere gratitude for the efforts

Environmental Report since 2000, and in 2012 we beganof our predecessors and the ongoing support of ourpublishing a CSR Report. Now, in response to increasing

stakeholders, as we have continued to grow into a global

interest from stakeholders regarding our corporate

Company with an overseas sales ratio of approximately

sustainability and value creation, we have compiled this50%.

report focused on our efforts to create economic andUnder these circumstances, in fiscal 2020, which issocial value over the medium- to long-term. Upon

the interim year of our “G-shift 2020” medium-term

reading this report, we welcome and appreciate any andbusiness plan, clothes dryers and built-in hobs

all frank opinions and feedback.

(stovetops) with automatic cooking functions, which

The Rinnai Group began in 1920 with the founding

contribute to shortening the time required for housework,of Rinnai & Co., by Hidejiro Naito and Kanekichi Hayashi,

performed extremely well. Additionally, thorough cost

who manufactured and sold pressurized oil stoves. With

reduction efforts in which we have been engaged fora deep sense of appreciation for their efforts, wequite some time have steadily yielded results.

commemorated our 100th anniversary in September
2020.

At the same time, although overseas sales were flat
due to trade friction between the United States andAs a heating equipment manufacturer that

China among other factors, water heater sales were

contributes to enriching people’s lives, Rinnai provides

robust, especially in the United States and China, withvarious products, including water heaters, kitchen

operating income increasing to near record-high levels.

appliances and air conditioners, under the keywords of

As a result, net sales in fiscal 2020 amounted to“safety and peace of mind,” “comfort” and¥340,460 million (down 2.2% year on year), with“environmentally friendly.” At present, we have bases in 18

operating income of ¥34,422 million (up 11.5%).

countries and regions, including Japan, and provide

Upholding “Quality is Our Destiny” for a Century
With pride in our hearts, we will boldly take on
the challenge of transforming intoa “new Rinnai” for the next 100 years
President

05

Hiroyasu Naito

Pressurized oil stove

Rinnai Report 202006

Message from the President continued

Customers are unsatisfied with their current lifestyles. Thus, we must be moreaware of social value.

Delivering Fine Quality Products that Customers Want Because
Rinnai Makes Them

During our long, 100 years of history, Rinnai has alteredpromise to our customers and society, we formulated the“Quality is Our Destiny” is the foundational concept thatlives.” If Kanta-kun had reused the same design as in theits product mix moment by moment. However, my sensebrand promise “Creating a healthier way of living” and arepermeates all Rinnai production bases throughout thepast, it would probably not have sold as well as it has.

is that recent changes in the social structure areworking to cultivate a brand image that conveys theworld. When it comes to water heaters, which are part ofClearly, the appearance of the product is very important,occurring more rapidly and on a wider scale than evercreation of healthy and comfortable lifestyles. In addition

everyday life in Japan, our products have earned a strong

and we want to deliver more fine quality products that

before. Driving the aforementioned solid sales of theto our traditional “heat and lifestyles,” “health andreputation overseas for “reliability and good temperaturecustomers choose because Rinnai makes them.

Kanta-kun gas clothes dryer and the DELICIA built-in hob

lifestyles” will be our new theme as we pursue thecontrol performance.” In fact, last year in China, Rinnai(stovetop) is the increased value provided by making

development of proprietary products with the

products ranked number one in gas water heater sales

housework easier and quicker in our modern society,establishment of the “New Business Strategy Office,”revenue on “Singles Day.” In terms of units sold, we

where the number of dual-income households has

part of our Research & Development Headquarters. We

ranked fifth, which clearly demonstrates that ourgrown substantially. In addition, I think there is awill revisit the products we have developed up to now in

products have strong support even when they are priced

significant advertising effect when purchasers of ouran effort to create a fresh appeal.

higher than other products.
The word “quality” of course implies functionality,

products share their satisfaction and excitement on

In April 2020, we launched sales of the “micro-

social media, perhaps indicating that the influence of

bubble bath unit.” This adds an element of “beauty” todurability and safety, but recently, we have also been

so-called “word of mouth” publicity has become quite“health and lifestyles,” generating a tremendous

especially particular about design. The aforementioned

substantial due to the changing times. In fact, we

response, especially among women. Actually, I thought“microbubble bath unit” has been meticulously

proactively placed advertisements on television, in

we already offered every function possible in terms ofdeveloped with a focus on quality and “enriching peoples’

newspapers and in other media expressing the idea thatwater heaters, but the addition of “microbubbles” in thisKanta-kun is a good product, but not yet well known. The

way provides a fresh appeal. I fully realize that, as I

result was more substantial than anticipated, reminding

suspected, customers are not satisfied with their current

me once again of the importance of advertising.

lifestyles. For this reason, I want to consider new

In April 2019, we updated the basic design
expressing the Rinnai brand worldview. And, as abusinesses and products with a greater awareness ofsocial value.

Gas clothes dryer Kanta-kun
offers an updated design thatis both simple and refined

Taking on New Challenges at Overseas Bases, Sharing the Results with the
Entire Group
Overseas, we completed the construction of a new plant

challenges in each country, sharing the results with thein response to the expansion of the tankless water heater

entire Rinnai Group. We have a strong sense of urgency

market in the United States. In addition to enhancing

in terms of competition with other companies, thus welocal production capabilities, we opened a newwill reaffirm the strengths Rinnai has built up to now andinnovation center in July to work on local productenhance our competitiveness through further

development. At the same time, in China, we will focus on

differentiation.

marketing and enhancing our ability to respond to rapidlychanging markets. We have much work to do, including
differentiating our products from those of competitors byemphasizing water heater performance, increasing
branding efforts and expanding online sales.
We are also promoting personnel exchanges
among major overseas bases, mainly involving
engineers. We will maintain our basic policy of promoting
DELICIA built-in hob (stovetop) offers the increased convenience of automatic
cooking using a linked app

07

Microbubble bathing provides a high-quality bathing experience with gentle bubbles

local production and sales as we take on various new

The “Try Rinnai Tour” installed a tankless water heater in a large van that embarked
on a promotional tour across North America

Rinnai Report 202008

Message from the President continued

Supporting Employees Taking on Challenges to Continue Growing for the Next
100 Years

Contributing to the Realization of a Sustainable Society, becoming a Company
Always Needed by Society

For some time now, I have told employees in sales,

employees to submit papers on Rinnai’s future. We

Recently in Japan, there is a heavy emphasis on

development, manufacturing and other divisions that arereceived many outstanding proposals from eachkeywords such as SDGs and ESG. The term

positions “consumer safety and quality improvements”

involved indirectly that I want them to hone their skills todivision, which I want to realize if feasible. And, in order for“stakeholder capitalism” is heard frequently as an

as critical issues. Our Company has been in business forcompete not only with competitors, but also with other

our Company to continue to grow for the next 100 years,

approach to corporate management that, rather than

100 years because we have consistently upheld ourindustries. My sense is that employees have taken thiswe will create an atmosphere in which more employees

simply pursuing profit for the company, contributes to thefounding concept “Quality is Our Destiny.” Going forward,

message to heart and are working diligently toward

are able to take on various challenges.

happiness of employees, shareholders, customers,

it is of the utmost importance that we continue to build

In March, the Rinnai Corporation was selected forbusiness partners, local communities and a wide range

trust and elevate our reputation for “creating products

the fourth consecutive year for inclusion in the Healthof other stakeholders. The Rinnai Group will also engage

that can be used with peace of mind.” We must maintain

who will be responsible for Rinnai 10 to 20 years fromand Productivity Index 2020, (sponsored by the Ministryin an all-out effort to realize a sustainable andthe effort and sincere support we have provided up to

now that I want them to make an effort to acquire theof Economy, Trade and Industry and the Tokyo Stock“better” society.

now so that the business partners who handle ourskills necessary for their jobs as well as take on various

Exchange). While maintaining our dedication to an “atchallenges to improve themselves on a personal level.

home corporate culture” and “thorough compliance,” webecoming more active, climate problems are said to havewill promote diverse work styles and aim for further

reached a “now or never” situation. Environmentallyenhancements to productivity.

friendly Rinnai products, such as the ECO ONE hybrid

our founding in large part due to the long-term support ofwater heater and heating system, which offers theour shareholders. To show our appreciation, in fiscal

world’s highest level of heat efficiency, will become one

2020 we plan to add a commemorative dividend of ¥10of our major strengths going forward. In recognition of

per share, bringing the full-year dividend to ¥110

our contributions to the environment through ourper share.

this end.
In addition to that, I have told the young employees

As part of our 100th anniversary project, we held
the “Rinnai of Tomorrow Proposal Awards” inviting all

In Europe, as the zero-carbon movement is

products, as well as our internal commendation system

Furthermore, in addition to the environment, Rinnai

products will continue to rely on Rinnai to respondproperly in the unlikely event that trouble occurs.
Rinnai is able to celebrate the 100th anniversary of

We will continue to contribute to the realization of aand other efforts to develop environmentally conscious

sustainable society through the provision of products

employees, for the second year in a row, Rinnai received

that are safe, offer excellent quality and bring

the Award of Excellence at the 2019 Environmental

convenience and comfort to everyone’s life. I sincerely

Human Resources Development Corporate Awards. Up

appreciate your continued support of the Rinnai Groupto now, our main focus has been on the development

as we strive to meet yourand sales of gas appliances, and we will further promote

expectations.

reductions in CO2 emissions through our products,
including hybrid water heaters that also efficiently
incorporate electricity, while flexibly responding to
President Naito commemorates Rinnai’s 100th anniversary (January 2020)

energy diversification.

2019 Environmental Human Resources
Development Corporate Awards

09

ECO ONE hybrid water heater and heating system, offering the world’s highest level of heat efficiency

Rinnai Report 202010

Rinnai Group Profile

Corporate Data (As of March 31, 2020)● Manufacturing and sales companies◎ Sales companies

RinnaiWorldwide○ Other business□ Overseas representative office(As of April 1, 2020)

Incorporated

September 1, 1920

Established

September 2, 1950

Paid-in capital

SOUTH KOREA

Head office2-26, Fukuzumi-cho, Nakagawa-ku,
Nagoya 454-0802, Japan

Telephone(From outside Japan): +81-52-361-8211● Rinnai Korea Corporation● RB Korea Ltd.

CHINA

Rinnai UK Ltd.

◎● Mikuni RK Corporation● Shanghai Rinnai Co., Ltd.

Number of Group companies◎ Shanghai Rinnai Thermo Energy Engineering Co., Ltd.

Rinnai Italia s.r.l.

UNITED STATES◎ Guangzhou Rinnai Gas and Electric Appliance Co., Ltd.

◎

●Rinnai Corporation
・Branches:◎

Rinnai Canada Holdings Ltd.
Rinnai America Corporation●

Indonesia¥10.6 billion

Tohoku, Kanto, Chubu, Kansai, Kyushu
Rinnai Hong Kong Ltd.
◎

Dubai Representative Office●
Rinnai (Thailand) Co., Ltd.
◎●
Rinnai (Malaysia) Sdn. Bhd.

・Domestic sales offices:●Rinnai Taiwan Corporation

Tokyo, Kita-Kanto, Higashi-Kanto,

Rinnai Vietnam Co., Ltd.

Minami-Kanto, Tokai, Shizuoka,

Rinnai Holdings (Pacific)
Pte Ltd.

◎

P.T. Rinnai Indonesia

Hokuriku, Nagano, Osaka, Keiji, Hyogo,
Chugoku, Shikoku, Fukuoka
・Factories and related centers:
Technology Development Center
Production and Technology
Development Center●

INDONESIA

Integrated Logistics Center
East Japan Logistics Center

AUSTRALIA

Rinnai Parts Center● Rinnai Australia Pty., Ltd.

Seto Factory○ Gas Appliance Services Corporation

Akatsuki Factory

Oguchi Factory● Yanagisawa Manufacturing Co., Ltd.

Water heaters, water heater with bath-filling systems,
water heater with heating systems, hybrid water
heater with heating systems, bathroom heater/dryer,
floor heating systems, and others

Home Heaters

Tabletop cookers, built-in hobs (stovetops), ovens,dishwashers, range hoods, rice cookers, and others● Gastar Co., Ltd.

● RB Controls Co., Ltd.

China
¥44.2 billion● Rinnai Precision Co., Ltd.
● RT Engineering Co., Ltd.

● Japan Ceramics Co., Ltd.
● Noto Tech Co., Ltd.

● Techno Parts Co., Ltd.
◎ Rinnai Net Co., Ltd.

Rinnai Brasil Heating Technology Ltd.
●○ Rinnai Enterprises

Industrial ceramics machines, commercial-use ranges,commercial-use cookers, gas clothes dryers, components, and others
Gas clothes dryer(JAPAN)DELICIA built-in
gas hob (stovetop)(JAPAN)

340.4¥

billionAustralia¥23.6 billion

Japan¥181.0 billion

United States¥33.1 billion

Commercial-Use Equipment, Others

Fan heaters, fanned flue heaters, infrared heaters, andothersNet Salesby Region
Total● Rinnai Technica Co., Ltd.

Rinnai New Zealand Ltd.
●◎
Central Heating New Zealand Ltd.

Kitchen Appliances

Others ¥19.9 billion

South Korea¥27.6 billion

Hokkaido, Kita-Tohoku, Sendai, Niigata,●

Rinnai Manufacturing Malaysia Sdn. Bhd.

Water Heaters and Heating Systems

48 (domestic 14, overseas 34)

JAPAN◎ Hainan Rinnai Minsheng Kitchen Appliances Sales Co., Ltd.

□

10,451 (consolidated), 3,758 (non-consolidated)◎ Rinnai Plus Corp.

● Shanghai RB Controls Co., Ltd.

◎ Rinnai Treading B.V.

Number of employees● RS Korea Ltd.

¥6,459,746,974

Others ¥30.6 billion

Commercial-use equipment¥8.5 billion
Home heaters¥18.9 billion

Gas fun heater A-style(JAPAN)Net Salesby Product
Total

340.4

¥

Eco Jozu, gas water
heater with bath-fillingsystem(JAPAN)11

High-efficiency gas
tankless water heater(UNITED STATES)

Drop-in gas hob(stovetop)(INDONESIA)

Fanned flue heater(UNITED STATES)

Commercial-use connectedwater heating system(AUSTRALIA)

Kitchen appliances¥86.1 billion

billionWater heaters andheating systems¥196.1 billion

Rinnai Report 202012

History Viewed from Changes in Medium-Term Business Plans

4,000

Rinnai has contributed to the advancement of “heat and lifestyles” through a variety of technological innovation in40

the fields of water heating, heating and air conditioning, and commercial equipment.
Rinnai will continue to create thermal energy equipment that addresses the needs of the times while accurately
grasping diversifying life scenes.

30

300

Domestic Sales

Overseas Sales

Operating income

50.4%

49.0%
20

100

32.9%

Medium-term Business Plans(Billions of yen)(Billions of yen)

Net sales

Operating income

200

Overseas sales ratio

V-Shift Plan

Reform & BreakthroughJump UP 2014

Evolution and Succession 2017

G-shift 2020
0

0

2006

2007

2008

2009

Start of new leadership structure
Strategic shift to focus on added-value

Japan

2010

2011

2012

2013

2014

2015

2016

2018

Arrival of replacement demand after peak of new housing starts in 1990s

Launch of DELICIA

Australia / Market penetration of tankless water heaters

2019

2020

(FY)

Deregulation of electricity and gas retailing

Launch of eco-series E Series Preferences for energy-saving precipitated by the Fukushima nuclear power accident

Growth in original products, such as clothes dryers
GASTAR Co., Ltd. consolidated into Group

Shift to higher-end models from the penetration of systems (baths and kitchens)
Brand promise formulated and Rinnai logo updated

Start of sales of products over the Internet

Overseas

2017

Rush demand ahead of consumption tax hike (to 8% from 5%)

Launch of ECO ONE

Sensors added to all stovetop burners

United States / Execution of tax credits

Global / Impact of the Lehman collapse

United States / Market penetration of tankless water heaters due to economic recovery and robust housing market
Indonesia / Rinnai Indonesia consolidated into Group
China / Expansion in area for gas water heaters due to build-out of gas infrastructureSouth Korea / Improving business at Rinnai Korea
United States / Receipt of Super Power Award for tankless water heaters

13

10

Brazil / Expansion in gas water heaters due to severe shortage of electricity
South Korea /Sensors added to allstovetop burners

Australia / Brivis Climate Systems Pty Ltd consolidated into Group

Rinnai Report 202014

Value Creation Process
The Rinnai Group attempts to conduct corporate management with a focus on ESG indicators to ascertain theenvironmental impact of various social issues and business activities as well as the opinions and expectations ofrelated stakeholders. We strive to realize sustainable corporate growth and contribute to international initiatives
such as the SDGs through the implementation of a value creation process driven by strategic management focusedon ESG indicators.

Rinnai Group Value Creation Process

External Environment / Social Issues

Business Activities

Climate change /global warming

Rinnai handles water heaters and heating units that utilize a large
proportion of residential energy.

Product usage risks

Company-related product usage risks include fires caused bygas stoves and “heat shock” occurring in the bathroom.

Work style changes
cause decrease inquality of lifestyle

Demand for products that reduce time required for household chores
due to decrease in quality of lifestyle as a result of a rise in dual
income households, declining birthrates and an aging population

Value Provided

Main products and services

Creation of products
and services that are safe,
secure, andenvironmentally friendly

Environmental
contribution(local production / in-house production)

Providing lifestyles that
reduce consumption of
everyday lifestyle energy
usage and impact on
the environment

Invested Capital (Fiscal 2020)
Human capitalIntellectual capital

Employees*1:
Employed (Rinnai non-consolidated) *1:
Training and development expenses:(Rinnai non-consolidated) *1
Overseas trainees (Rinnai non-consolidated):
Development headquarters staff:(Rinnai non-consolidated) *1
R&D expenses (Rinnai non-consolidated):ISO 9001 certification acquisition:(number of companies) *1
ISO 14001 certification acquisition:(number of companies) *1

10,451 people
84 people¥165 million

Natural capital

Input energy:
Water used: Ground water:
Public water:

10.1%

7.0%
4.9%
70.1%

Promoting businessunder the slogans “Heat & Lifestyles”
and “Health & Lifestyles”

1,106,557 GJ
191,996 m3
615,777 m3

Safety andpeace of mind
Supporting lifestyles thatenable the prevention andavoidance of various
potential risks in the home

15

¥21,561 million
Net assets (equity ratio)

Dividend per share*1 As of March 31, 2020

Decreasing working hours and intensifying
competition for securing human resources

Net income attributable toowners of the parent company¥340,959 million (70.1%)

Rinnai brand, external evaluations, stakeholder engagement,
Rinnai Group Code of Ethics[Domestic] Declining birthrates, an aging
population, and a decreasing in the numberof households

Operating income

Operating income ratio

15 companies

Rinnai Group production bases:
25 companies(number of companies) *1
Production group staff (Rinnai non-consolidated) *1:
1,979 people
Capital expenditure (Rinnai non-consolidated):¥5,330 million[Domestic] Price reduction of gas
appliances due to customer requests¥340,460 million¥7,292 million
17 companies

Manufactured
capital[Domestic] Expansion of thermal energy
systems centered on electric power

Consolidated net sales

10 people

ROE
ROA
Equity ratio

Risks

Gas stoves, range hoods, water heaters,
hot water floor heaters, gas clothes
dryers, dish washers¥34,422 million

480 people

Financial capitalSocial andrelationship capital

Fiscal 2020 Achievements(annual) ¥98
Opportunities
Growing demand for energy-saving
products by strengthening environmental
policies
Increasing needs for safety and accident
prevention as social issues[Overseas] Expansion of natural gas use[Overseas] Improving living standards
Progress in evaluation of corporate ESG
initiatives

Quality of life
Development of technologies
useful for people’s lives

Contribute to raising
standards of living globally(Combustion / heat utilization, electronic control,
fluid control, new technologies)

Social issue recognition

Proposing lifestyles that
reduce the burden andtime required to perform
household chores

Amount contributed toreducing CO2 emissions
2.61 million tons
Announcements of productrecalls due to defects: 0 case

Rinnai Report 202016

Message from the General Manager of Corporate Planning Headquarters

Valuing the worldview that Rinnai is aiming forand pushing forward with the Rinnai way which
represents our passion as a manufacturer

View of the market environment: Risks and opportunities

Masao Kosugi
Director and Senior Managing Executive Officer,
General Manager of Corporate Planning
Headquarters

Sensing progress in achievement of the medium-term business plan(considering the impact of COVID-19)
We are carefully considering the impact of the novel coronavirus (COVID-19) pandemic on our business. However, Rinnai

From its first plan in 2006 to the current G-shift 2020 plan, we have implemented five medium-term business plans.

is a maker of daily necessities, so with the pandemic causing people to spend more time at home and be more

The past four medium-term business plans focused on creating a strong profit structure, but since President Naito’sconcerned about cleanliness, we view the current situation as a major opportunity. In our U.S. business, where the impact

appointment, we have aimed to create a stable financial foundation by actively introducing value-added products toof COVID-19 has been mild, tankless water heaters have driven earnings recently. In China, the stoppage of operation

the market.

from mid-February had somewhat of an impact but business is now back to normal. Rinnai’s thermal control technologies

I position our performance in fiscal 2020 as a challenge to strengthen our foundations. Moving forward, we arelead that of its global peers, and in particular the accuracy of the temperature control in our water heaters thanks to ourbuilding an innovation center in the United States to lead local product development and will invest the necessary funds inelectronic control technology has been highly regarded. Looking at the longer-term, although there is a risk that the shift

China to expand sales of gas stoves and commercial products as well as water heaters. In addition, a recent focus has

away from fossil fuels may accelerate, we believe our thermal exchange technologies can be applied as energy becomes

been an aggressive push to strengthen our branding. We are promoting product appeal and boosting awareness of themore diversified going forward, so this trend can be viewed as a growth opportunity.

Rinnai brand among consumers and trading partners from a global perspective. Such activities are clearly focused on

In Japan, we launched the microbubble bath unit to respond to demand from health-conscious consumers and will

global standardization, and I sense progress in the achievement of medium-term business plan as an overseas strategies
to secure our position as a truly global company.

continue to focus on product development while prioritizing marketing from the consumers’ viewpoint.

From here we will prioritize strengthening our touchpoints with consumers in Japan and overseas both real andonline and collaborate with external partners who are adept in this area.

Fiscal 2020 Performance of Overseas Subsidiaries

Positioning of Medium-Term Business Plan “G-shift 2020”(Millions of yen)

Net sales
Rinnai America

33,133

YoY
109%

OperatingincomeSales ratio

2,032

6.1%

Ordinary
incomeSales ratio

2,025

6.1%

Net income

Sales ratio

5th

Business Plan
(current plan)

4th

1,436

4.3%

Rinnai Australia

23,760

95%

593

2.5%

393

1.7%

262

1.1%

Business Plan

Shanghai Rinnai

43,628

92%

5,593

12.8%

5,868

13.5%

5,228

12.0%

Rinnai Korea

27,53584%(1,382)—(1,248)

—

(987)

—

Rinnai Indonesia

11,263

88%

1,600

14.2%

1,906

16.9%

1,504

13.4%

1st

Reform &BreakthroughV-Shift
Plan(Consolidated)
Net sales¥236.7 billion
Operating income¥15.0 billion
Operating margin
6.4%

2006
(FY)

Jump Up2014

Business Plan

Business Plan

(Consolidated)
Net sales¥246.6 billion
Operating income¥26.6 billion
Operating margin
10.8%

2009

Business Plan

3rd

Medium-Term Business Plan

2nd

17

New challenge for sustainable growth

Strengthening corporate structure
through the past four business plans(Consolidated)
Net sales¥295.0 billion
Operating income¥30.7 billion
Operating margin
10.4%

2012

Evolution andSuccession

2017(Consolidated)
Net sales¥347.0 billion
Operating income¥32.8 billion
Operating margin
9.5%

G-shift
2020(Consolidated targets)
Net sales¥325.0 billion
Operating income¥32.0 billion
Operating margin
9.8%

Next
MediumTerm
Business
Plan

100th

anniversary

Formulated roadmap
Branding control

2015

2018

2021

2024

2027

2031

Rinnai Report 202018

Thinking with regard to capital policies and capital investment plans
Rinnai’s investment strategy has been to sustain a relatively high level of capital investment. In particular we have invested

Until now, Rinnai has operated debt-free and has kept relatively stable reserves on the funding front in order to be

in expanding factories in the domestic business that manufacture products with growth potential, such as gas clothes

agile. However, to prepare for the current COVID-19 situation, natural disasters, and other unpredictable circumstances,

dryers and ECO ONE series. Our investment has thus focused on the rationality of production.

we are reviewing our policies while remaining cognizant of the need to build a strong financial foundation and to ensure

We are also investing intensively in expanding and adding equipment at overseas factories in markets where growth

our BCP measures function as intended. We have previously been strongly committed to consecutive dividend increases
and stable dividends but going forward we will rethink our capital policy as “management on offense” that considers an

is projected, which also contributes to local development.
In addition, we will invest aggressively in consumer-oriented marketing measures and promotion activities to directly

optimal balance of return to shareholders, return to employees, and investment in the future.

associate high value-added products with the Rinnai brand both in Japan and abroad.
Capital investment

Research and development costs

Capital investment[Millions of yen]
FY2020 Actual[Billions of yen]Amount ofinvestment

Depreciation
andamortization

Amount ofinvestment

Depreciation
andamortization

5,330

5,659

6,467

5,606

15

Rinnai Corporation
Domestic consolidated and affiliated companies
Overseas consolidated companies

1,965

2,073

3,271

1,999

3,284

4,402

11,750

4,372

10

Total

10,58012,134

21,48911,977Of the above total, the amount related to molds

2,831

3,260

4,141

3,134

25
20

5

Research and development costs

0

2018

2019

(FY)

2020

2021
Plan

(Millions of yen)

FY2021 Plan

FY2020 Actual

FY2021 Plan

Rinnai Corporation
Domestic consolidated and affiliated companies

7,292

8,000

2,015

2,845

Total

9,308

10,845Furthermore, to enhance awareness of the thinking behind capital policy, we have established a working group for
capital policy for internal deliberations using ROIC, ROE, and other financial metrics that are more precise and transparent

Forward-looking
investments

Capital investment
7,124

Operating cash flow
37,694

Shareholder returns, etc.
6,436

Operating cash flow

Capitalinvestment

Expand internal
reserves (cash flow)
24,004

Shareholder
returns, etc.

Internal reserves(cash flow)
116,133

Emergency
response
expenses

Fiscal 2020 ActualCompany we aim to be in thenext medium-term business planfrom a finance perspective. To increase awareness of asset turnover, we are using ROIC as an indicator not only at thecompanywide level, but also to evaluate each business unit.

The Rinnai way is to be keenly aware of social contributions through its
core business
Consolidated ROE

Consolidated ROIC

ROE=Net income ÷{(Shareholders’ equity at current fiscal year +shareholders’ equity at previous fiscal year) ÷ 2}

ROIC=NOPAT ÷ {Invested capital at current fiscal year +Invested capital at previous fiscal year)÷ 2}

15.0%

30.0%

With society’s interest in ESG and SDGs on the rise, I believe Rinnai’s employees are very fortunate in that Rinnai’s
products can help reduce CO2 from the usage stage (Scope 3) and therefore they can take pride in the fact their work in
Rinnai’s core business is contributing to the environment.

10.0%

9.0%

8.4%

7.6%

20.0%

7.0%

In the past, Rinnai was very particular about things (products), but going forward as we provide experiences (value),

18.3%
15.7%

7.0%

5.0%

13.8%

15.1%

we will gain consumers’ empathy while we create that value. At the same time, we will value the worldview that Rinnai isaiming for and push forward with the Rinnai way which represents our passion as a manufacturer.

10.0%

0.0%

0.0%

2016
(FY)

19

20.1%

2017

2018

2019

2020

2016
(FY)

2017

2018

2019

2020

Rinnai Report 2020

20

Rinnai Group CSRManagement Policy

Quality Policy

We will help improve the living
standards of people around theworld with the keywords of “heatand living” and “health and living.”
In addition to providing existingproducts and services, we will
create unique offerings byincorporating new technologies
into our own core technologies and Rinnai Group
companies shallshare and closely
advancing their applications. In
coordinate
information
addition, we will shift and optimally
allocate managerial resources to a
new organizational structure, which
will lead to sustained growth overthe next 10 and 20 years.

Based on our fundamental concept, “Quality is our destiny,” under our Quality Policy, our Group employees strive toimprove design quality, manufacturing quality, and sales quality with a customer-oriented approach.

Global Markets“Heat and Lifestyles”“Health and Lifestyles”~ We shall help improve people’s living standards ~Contribute to the environment through our corebusiness activities (products and services)

Develop and provide original products and services

Combustion andheat utilization
technologies

Electronic
control
technologies

Fluid control
technologies

New
technologies

Rinnai Group
companies shallshare and closely
coordinate
information~ Recognize core technologies that represent our strengths ~Renewable Electricity
energyGas

Air

Quality Policy

Customer Orientation

To provide products with satisfaction anda high level of safety to customers

To offer products with safety and peace of mind; To
disseminate safe usage; An enriched service body

Environmental Policy
For our environmental initiatives, we promote all-hands environmental activities with full participation based on anenvironmental action plan (”7E Strategic Initiatives”) aiming for its accomplishment in 2020, under the following basic
environmental philosophy.

Water

Approach to CSRWith the creation of healthy and comfortable lifestyles as its corporate mission, Rinnai promotes CSR activities throughbusiness focused on ESG throughout the entire Group.

Basic Philosophy on the Environment

Environmental Slogan

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.

Our actions are imbued by the wisdom of many andundertaken with due consideration to thesustainability of a people- and earth-friendly
environment.

7E Strategic Initiatives
Quality
We adhere to the fundamental
concept that “Quality is our destiny.”
To this end, we pursue a “zerodefects” objective when designing,making, and selling our products,
to ensure they remain fault-free until
they are no longer used byHeat and Lifestyles
We deploy our advanced heatrelated technologies and know-how
to develop products that people canuse in a safe, comfortable, andefficient manner. In this way, we help
people lead abundant lifestyles.

Approach to CSR
Contributing to Local
Communities
In principle, we focus on local
production and local sales inadvancing our overseas business.
Our aim is to help improve the livesof local people around the world by
delivering products and services
that meet the climates, lifestylecultures, and customs of various
nations and regions.

21

The Group pursues CSR activities based on the threecommitments it has emphasized since its foundation—“heat and lifestyles,” “quality,” and “contributing tolocal communities”—complemented by “theenvironment,” for a total of four key themes.

Green Activities Involving All
Employees in All Business Areas

1

5 Emphasize
2 Promote green procurement

E-Service
E-Procurement (Installation(Procurement) and repair)

3 Promote activities

with reduced
environmental
impactE-Factory(Factories)

E-Office(Offices)
E-Marketing(Sales)4 Sell environmentallyconscious products;
Encourage customers
to be moreenvironmentally aware

environmentallyconscious installation
and repair services

E-Products(Products)

the customer.
The Environment
We reduce greenhouse gas
emissions by developing,
manufacturing, and selling
residential appliances, which are
kitchen appliances, water heaters
and heating appliances, withexceptional energy efficiency.

Develop and provide environmentallyconscious productsacE-Mind (Employees)tartivi B usinaltie s
e s s a n d e n v i ro n m e n t r a t e c
as whoe e l s of s a m e c o r p

6 Promote activities with

reduced environmental
impact at our offices

7

Improvement of
our employees’
environmental
awareness andpromotion of social
action programs
through environmental
education

Rinnai Report 202022

Identifying CSR Material Issues
We make every effort to identify social challenges relating to the Rinnai Group, through day-to-day communication

CSR Material Issue Targets and Results
Deep Involvementwith SDGs

activities with stakeholders coupled with study and analysis of applicable guidelines and ESG indices. We also
identify CSR material issues through the Rinnai Group value creation process in relation to our management
strategies, revolving primarily around our Corporate Planning Division.

Identification Process● Conduct stakeholder questionnaire withthe aim of reviewing our CSR Report● Ascertain matters of interest to
stakeholders based on questionnaire
results and opinions expressed

Step 1

Step 2Outline existingengagement

Review CSR Report,(previous year s
version)● Outline communication activities withstakeholders● Ascertain opinions and matters of interest
to individual stakeholders● Analyze trends such as changing perspectives
on ESG and matters of public interest (Dow
Jones Sustainability Indices, FTSE4Good
Index Series, Toyo Keizai Corporate Social
Responsibility Survey, etc.)

Step 3
Analyze international
standards andguidelines

Step 4
Analyze ESG indicesand questionnaires● Analyze CSR-related international
standards and sustainability
reporting guidelines (ISO 26000,
GRI G4 Guidelines, etc.)● Determine social challenges relating to the
Rinnai Group, and analyze their level ofimportance to stakeholders and Rinnai● Examine consistency with Rinnai management
strategy and identify CSR material issues

Step 5

Step 6

Study othercompanies

Determine social
challenges and identify
material issues● Study CSR management practices,
key stakeholders, and material issues● Analyze methods of reporting CSR
activities

We have determined social challenges relating to the Rinnai Group, analyzed their level of importance to stakeholders and the Group, and identified CSR
material issues.
As a change from the previous year, we have increased the importance level of the item “Work-life balance” to stakeholders and the Rinnai Group by one
level each.

Very high<Importance to stakeholders>High
23○ Environmental issues◇ Customer issues

Energy consumption
CO2 emissions

Amount contributed toreducing CO2 emissions
by using the productWe intend to develop and encourage
households to use water heaters andheating units with an emphasis on energy
savings and environmental performance,
in an effort to reduce energy consumption
and reduce household CO2 emissions.

Target area: Global(Main focus of initiatives: Japan)
Target stakeholders: All

Material Issues

Main Target Indicators

Consumer safety
Improving quality

Number of defects that have
led to product recall
announcements

2020 target

3.32

million tons

2030 target

6.04

million tons

CO22019 results: 2.61 million tons

We are working toward achieving zero defects
Target area: Global
by eliminating defects at every stage of theTarget stakeholders: Customers
product lifecycle—from development,
production, and sale through to
obsolescence—and pursue a range ofactivities to publicize information and raiseawareness of preventing accidents in the home.

Deep Involvementwith SDGs

0case2019 results: 0 cases○ Waste○ Harmful chemicals◇ Health□ Work-life balance◇ Housework time reduction○ Energy consumption○ CO2 emissions◇ Consumer safety◇ Improving quality○ Biodiversity□ Child labor / forced labor□ Stable procurement□ Support for cultural activities
and the arts

○ Conserving resources○ Drainage□ Industrial relations□ Occupational health and safety□ Protecting privacy◇ Repair and inspection services□ Wages and welfare□ IR communication activities□ Fair trade□ Work style reforms□ Diversity□ Support for school education /vocational training□ Preventing corruption○ Transport and transfer◇ Enhancing Customer Center
services□ Training and education□ Dividend policy□ Surveying and evaluating suppliers<Importance to the Rinnai Group>

The Rinnai Group is participating in the Sustainable Development Goals (SDGs) set at the United Nations Summit in September 2015 and its actively
working to contribute to them. As Rinnai provides society products that are closely related to the global environment and people’s lives, it recognizes theimportance of SDGs and will further develop its business with a focus on them.

The Sustainable Development Goals (SDGs)□ Other issues◇ Pandemic□ Communicating with suppliers□ Investing in local communities

High

Main Target Indicators

Toward the achievement of a sustainable society

Determining and Identifying CSR Material Issues

Classification of CSR Issues

Material Issues◇ Marketing communication

SDGs items related to value provided in Rinnai’s value creation process
Environmental Providing lifestyles that reduced energy
consumption and impact on the global environment
contribution in daily life
Safety andsecurity

Supporting living by preventing and avoiding
risks inherent in households
Proposing lifestyles in which the burden of

Quality of life housekeeping and time spent on household chores
Very highare reduced.

Rinnai Report 202024

Special Issue

01 [Environment]
Linkage with SDGs

Approaches to Preventing Global Warming
through Energy-saving Water Heaters
Aiming to contribute to a 6.04 million ton
reduction in CO2 by 2030

CO2
Reduction in CO2 during
product usage2020 Goals

3.32
million tons
2030 Goals

6.04
million tons

Power & lighting, etc.
34%

Looking at the breakdown of energy consumption by Japanesehouseholds, water heating and heating account of over 50%, andwater heating alone accounts for the largest percentage at 28%. In
addition, CO2 emissions of water heaters throughout their lifecycles
are highest at their usage stage. As a result, to contribute topreventing global warming through its business activities, Rinnai
believes it is important to boost energy efficiency and develop andpromote the adoption of environmentally conscious products that
help accomplish this through improving the combustion efficiency of
its hot water heaters and the like. Rinnai is working toward theprevention of global warming by setting “energy consumption andCO2 emissions” as CSR material issues and the “amount contributed
to reducing CO2 emissions by using the product” as a target indicator *.
* Note 1: Reduction in CO2 emissions (estimated) resulting from improvements to performance in Rinnai’s
water heaters compared with products sold in 2005. (sales in Japan and the United States).

Heating
water
28%

Percentage ofhousehold energy
consumption by usage(2018)
Cooling3%

Cooking9%

Heating
25%

Source: “Energy White Paper 2019,” Agency for
Natural Resources and Energy

CSR materiality targets
Reduction in CO2 during
product usage

3.32 million tons
2030 Goals
6.04 million tons
Fiscal 2020
2.61 million tons
(actual)2020 Goals

CO2 reduction volumes are linked to the Rinnai Group’s corporate growth
Since our business is closely related to energy consumption, the amount of our contribution to CO2 reduction iscorrelated with improvement in our sales and profits. In fact, as our company grows, we contribute more to CO2
reduction.
Rinnai earnings (parent sales) and contribution to CO2 reduction

Volume contributed to CO2 reduction

190,000
180,000
170,000

1.2(*Impact of consumption tax hike)

200,000

Net sales

Rinnai parent sales

210,000

1.0
0.8
0.6
0.4
0.2

160,000
150,000

Volume contributed to CO2 reduction(million tons-CO2)
1.4(Millions of yen)
220,000

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

0

* Volume contributed to CO2 reduction: Japan sales portion, simple calculation

25

Rinnai Report 202026

Special Issue

01 [Environment]

Disclosure of Environment-related Financial Data
Expressing Support for Task Force
3 Risk Management
With the aim of creating a virtuous circle of the environment and the economy which assumes a sustainable company,
Rinnai has expressed its support for the recommendations issued by the Task Force on Climate-related Financial
Disclosures (TCFD), a taskforce established by the Financial Stability Board (FSB). We are promoting the disclosure of
the financial impact on the Company caused by climate change and our approaches to resolve these issues.

Rinnai’s risk management is led by its Risk Management Committee. The committee periodically updates Rinnai’s risk
profile including risks associated with climate change and manages risks by classifying them by frequency of occurrence
and level of impact.

4 Metrics and Targets
1 Governance
Rinnai’s Corporate Planning Headquarters and the Environment Division are taking the lead in compiling ESG-related
issues and allocating them to the relevant departments to undertake improvement initiatives. In addition, the Environment
Management Committee is the secretariat for ISO14001 operation and promotes initiatives related to risks andopportunities associated with climate change and reports such activities to the leadership team.

Risk Management
Committee

TCFD recommended disclosures and content of Rinnai’s disclosure
Sharing of risks andopportunities related
to climate change

Leadership
Team
ReportIn its approach to climate change risks, Rinnai has prioritized “improving energy efficiency and developing popularizing
environmentally conscious products that achieve this”. Rinnai is working to manage climate change risk by setting“energy consumption and CO2 emissions” as CSR material issues and the “amount contributed to reducing CO2
emissions by using the product” as a target indicator.

Corporate Planning Headquarters
Environment Division

Environment Management
Committee

Recommended disclosures

Content of Rinnai’s disclosure

Governance

Environmental management
https://www.rinnai.co.jp/csr/manage_system/

Strategy

Value creation process
https://www.rinnai.co.jp/csr/value/

Risk management

Risk management
https://www.rinnai.co.jp/csr/risk_manage_system/

Metrics and targets

Value creation process
https://www.rinnai.co.jp/csr/value/
Approaches to preventing global warming through energy-saving
water heaters
https://www.rinnai.co.jp/csr/reduction/

Initiatives to overcome climate change issues

ISO14001
2 Strategy
In the flow to specify key CSR issues (materiality) in Rinnai’s value creation process, we identify risks and opportunities
associated with climate change. We also work to enhance the accuracy of our estimates of the impact of climate change
on Rinnai by performing scenario analyses in accordance with the Representative Concentration Pathway (RCP)
scenarios of the Intergovernmental Panel on Climate Change (IPCC) and calculating the financial impact. The impact ofclimate change is also checked against our management strategy and reflect in our medium-term business plans.
Rinnai’s risks and opportunities associated with climate change
Risks
1. Restrictions on water heaters due to depletion of water resources (Financial impact: Large)
2. Raw material procurement risk associate with climate change (Financial impact: Large)
3. Restrictions on gas water heaters due to restrictions on fossil fuel (Financial impact: Large)
Opportunities
1. Diffusion of energy-saving hot water heaters resulting from tighter environmental restrictions (CO2)
2. Diffusion of gas boilers resulting from tighter environmental restrictions (PM2.5)

27

Rinnai Report 202028

Special Issue

01 [Environment]

Global Development of Water Heaters in
the Rinnai GroupThe Rinnai Group manufactures and sells water heaters broadly not only in Japan but overseas which makes its businessclosely linked to energy consumption and CO2 emissions. Viewed from a different perspective, this means thedevelopment and widespread use of highly efficient water heaters may significantly reduce the burden on theenvironment.

Initiatives at Rinnai America Corporation

The water heater market in North America is dominated by storage tank-type units that are not very energy efficient.
Rinnai has been promoting the conversion to tankless water heaters that are highly energy efficient. Efforts to boost
awareness over many years are bearing fruit and sales volumes for tankless water heaters have been rising recently.
Rinnai America will help ease the impact on the global environment through the wide diffusion of highly efficient tanklesswater heaters.
Rinnai America is focused on aggressive product PR using mass media and on expanding its sales and installation
network to encourage widespread use of tankless water heaters. Rinnai has outfitted vans as mobile mini-showrooms
which provided the opportunity to install and outfit tankless water heaters in a tour covering over 700 locations in the
United States and Canada. Rinnai’s water heaters were very well received in North America where storage tank-type
units are the mainstream, as participants were able to experience firsthand the performance of tankless water heatersthat offer the convenience of and endless supply of hot water.
Rinnai previously sold compact gas boilers used in heating applications on an OEM basis (procured productmanufactured by another company) but subsequently built a manufacturing structure at its domestic
plants and began selling the I-Series of high-efficiency boilers as a strategic model in July 2019.
The boiler heats water while also being used to heat rooms and offers detailed temperature control,features which are being promoted to further expand demand.
In 2018, Rinnai America expanded its headquarters, which is now equipped with facilities toprovide training on installation to the employees of sales distributors and certified service agents.
We also expanded testing equipment tailored to the local usage environment as we endeavor
to build out and strengthen our network in North America.

29

Europe

China
Japan

Middle East
AfricaInitiatives at
Shanghai Rinnai Co., Ltd. (China)

South Korea

Taiwan

North America* Graphical depiction of theapproximate sales volume of
Rinnai’s water heaters in thearea over 10 years (unitdiffusion over 10 years)
indexed with Japan at 100.

South America

Oceania

The gas infrastructure in inland China is not developed and compact electric units hold a certain share of the water heater
market. However, as living standards rise, there is growing demand for high-capacity and highly efficient gas water
heaters, which has supported a gradual expansion in sales of Shanghai Rinnai’s main business.
Shanghai Rinnai has traditionally sold its products in Tier 1 and Tier 2 cities along coastal regions, such as Shanghai
and Beijing. However, recently the installation of gas pipelines have expanded gas usage in Tier 3 and Tier 4 cities in theinland areas, and Shanghai Rinnai has been working to expand its gas water heater sales in those markets as well.
Gas water heaters overcome the shortfall of electric models, namely the supply of hot water cutting off (using hot
water continuously causes the stored hot water to be depleted) and are notably more convenient. Yet they also have thedisadvantage of emitting cold water stored in equipment and pipes when the water heaters are first used. Gas water
heaters that instantly dispense hot water overcome this and are enjoying brisk diffusion. In 2019 Shanghai Rinnai
launched a new model that instantly produces hot water and has been working to expand its market share.
In China, Internet sales of gas equipment have been rising in tandem with the general trend in consumption toward
online sales. Rinnai Shanghai’s Internet sales ratio also rose by about 3 percentage points comparedwith 2018. We will work to enhance awareness of Rinnai by selling hot water heaters that are only
available through the Internet and by promoting Rinnai’s strengths in quality and performance.

Rinnai Report 202030

Special Issue

01 [Environment]

Environmental Impact within Rinnai’s Value Chain

Rinnai promotes environmental impact reduction initiatives through the value chain (see Note 1) in consideration ofsocietal demands and impact on the environment.
Note 1: A series of business activities and value creation processes that companies conduct to provide customers value in the form of products and services.

Rinnai’s Value Chain

Demands andExpectations from Society(Overseas / Japan)

INPUT
Main resources consumed(Raw materials and energy)

Procurement

Development and Manufacturing

Sales, Logistics, and Services

Product Usage

Disposal

Handling procurement risk
through the supply chain• Increased demand for heat-energy
appliances mainly in the Asia region• Support for international frameworks
such as the Paris Accord and otherenvironmental regulations

Provision of household appliancesthat contribute to energy-efficient
homes such as Net Zero Energy
HousesPromotion of energy efficiency in the“use stages” with the largest amountof CO2 emissions in the productlifecycle

Promotion of activities that
contribute to building recycling
societies, including compliancewith plastic regulations

Raw materials
Iron, copper, stainless steel, brass,aluminum, plastics, rubber, etc.

EnergyWater• Energy; 1,106,557 GJ• Ground water: 191,996 m3

EnergyWater

EnergyWater

EnergyWater• Public water: 615,777 m3

CO2 Emissions (Emissions Ratio)

OUTPUT
Rinnai’s environmental
impactInitiatives Rinnai
conducts throughbusiness

821,979 t(7.16%)—

36,723 t (0.32%)
Scope 2 66,239 t (0.58%)
Scope 1

Solid waste

Wastewater

30,591 t

778,125 m³(Includes valuable substances)(0.07%)

5,942 t10,511,507 t (91.53%)(Concerns emissions from Japanese water heaters)(0.05%)——

Proposal of reasonably
achievable ecological lifestyles

Promotion of environmentallyconscious design

Pursuit of environmental
performance and streamliningof manufacturing processes

Spread of environmentallyfriendly products

Procurement: We work with suppliers topromote improvement activities
that make the flow of products,from parts procurement tocommercialization, better.

Development: Develop products with superior
environmental performancethat meet the climate andneeds of the region

Sales: Strive to spread products that
contribute to energy efficiency inthe water heater and heating fields

Manufacturing: We are pursuing efficient processes,
minimizing invested resources andenergy, and promoting activities that
contribute to emission regulations
for CO2, waste products andchemical substances.

Scope 3 (Category 11)—

Supply chain management

Rinnai’s estimates based on the “Basic Guidelines for Calculating Green House Emissions Through the Supply Chain”[Target scope]	Rinnai Corporation and consolidated subsidiaries (development / manufacturing), Rinnai Corporation (procurement / sales / logistics / services / product usage / disposal)[Target period] Domestic: Fiscal 2020 (April 2019–End of March 2020)
Overseas: January 2019-End of December 2019
[CO2 emissions (units)]: tCO2e, (%) represents the emissions ratio within each process.

31

8,377 tLogistics: We are promoting logisticalstreamlining.
Services: Elevate the Rinnai brand withsecurity activities through a wealthof service maintenance andinspections

Product Usage: We are teaching customers the environmental
Disposal: Application of design for thefriendliness of our products and promoting theirenvironment, e. g., to makeecological use through Company-sponsored
products easy to disassemble
product events.
in accordance with product
Proposal of sustainable, comfortable, and green
assessment standards
lifestyles through use of energy-saving products
Through various events, we will appeal to all of
our end users the environmental performanceof our products and how to use them with theenvironment in mind.
The value chain is the chain of business activities and processes undertaken by acompany to generate and deliver value (products and services) to the customer.
Indicators marked with a check have received a third-party guarantee from,
Lloyd s Register Quality Assurance Ltd. (LRQA).

Rinnai Report 202032

Environment

Environmental Initiatives

Environmental Management
Basic Philosophy on the Environment

Environmental Slogan

Promotional Framework for Environmental Activities

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

Our actions are imbued by the wisdom of many andundertaken with due consideration to the sustainability ofa people- and earth-friendly environment.

Headed by the President, the Environment Management
President
Committee guides corporate efforts to achieve targets ofEnvironment Management Committee
the 7E Strategic Initiatives environmental action plan. This
Chairman of the Committee: Executive officer in charge of environmental issues
Execution and improvement of environmental management systems
committee is chaired by the executive officer responsible
for the environment and has the participation ofEnvironment Division
representatives from all divisions. Its mandate is to promote
environment-oriented activities from a “big picture” view.
The Environment Management Committee discusses
Marketing &Logistic Control Office Head
Research & Development
Factories
Office Sales Headquarters
Parts Centers
Headquarters
and decides important items including the basic
Production Engineering Divisionenvironmental basic policy, the goal, and a medium toEnvironmental Management Promotion Systemlong-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 ourobjectives as necessary and diligently strive to meet our targets quarterly. To perform specific activities, each division has
a liaison group and holds routine meetings to make issues known to everyone in the respective division and continue
improvement activities.

Environmental Action Plan (7E Strategic Initiatives)
Our goal is for employees with a high awareness of the environment to make environmentally friendly products atfactories that operate in harmony with the environment and provide these products with confidence to our customers.
We will pursue our carefully tailored 7E Strategic Initiatives as a monozukuri company in all processes (development,
procurement, manufacturing, sales, usage, and disposal) in product’s life cycle. The 7Es are E-Procurement of raw
materials and parts; E-Factory, where monozukuri happens; E-Products that are made, E-Service of products customers
use; E-Office, where administrative work is conducted; and E-Mind who are the foundation of our activities.

ISO 14001 Certification

1

Develop and provide environmentallyconscious products
5 Emphasize

E-Service
E-Procurement (Installation(Procurement) and repair)

3 Promote activities

with reduced
environmental
impactE-Factory(Factories)

33

E-Office(Offices)
E-Marketing(Sales)4 Sell environmentallyconscious products;
Encourage customers
to be moreenvironmentally aware

environmentallyconscious installation
and repair services

E-Products(Products)

2 Promote green procurement

ac

E-Mind (Employees)tartivi B usinaltie s
e s s a n d e n v i ro n m e n t r a t e c
as whoe e l s of s a m e c o r p

To conduct environmental conservation activities in an organized and ongoing basis in line with Rinnai’s Basic Philosophy
on the Environment and Environmental Policy, Rinnai promotes environmental management and works to boost its
environmental performance through the acquisition of ISO 14001 and other certifications related to environmental
management systems.
In fiscal 2020, the Minami-Kanto Branch, a domestic sales base, and Rinnai Viet Nam Co., Ltd., an overseas Group
company, joined the list of sites that have been certified.
Link destination Data Book Environmental Data Page 117 Status of Acquisition of Certifications

6 Promote activities with

reduced environmental
impact at our offices

7

Improvement of
our employees’
environmental
awareness andpromotion of social
action programs
through environmental
education

External and Internal Environmental Audits
Rinnai undergoes a routine annual audit by an external screening/registration body to verify that its environmental
management system is being properly applied. Regarding internal audits, the audit team is composed of auditors
selected from throughout the Company with a neutral perspective in that they are not directly affiliated with any of thedepartments to be audited. They audit other departments for compliance with the environmental management system
and with any revisions to environmental regulations as well as for the content of their activities.
We have confirmed that external and internal audits are conducted through a PDCA cycle each year.

Rinnai Report 202034

Environment

Environmental Initiatives

Environmental Training

Environmentally Conscious Design (Product Assessment)

To promote environmental activities, it is important for all
employees to have an environmental mindset. Rinnai implements
practical training for persons in charge and general training at eachlevel of the organization.

Rinnai implements product development with a focus on the environment from the planning and design phases based on
its product assessment guidelines. We are developing equipment with a lesser impact on the environment thanpreceding models by reducing the amount of raw materials required and considering recycling in designs, such as
structural designs that facilitate disassembly.
With regard to the use of plastics in our products, we have set a goal to make new products lighter and with a smaller
footprint than previous models as outlined in these guidelines. At the same time, we endeavor to consider how the
product will be taken apart, such as minimizing the use of dissimilar materials in adhesive parts, which are difficult todisassemble. In our packaging design, we use packaging made from easy-to-recycle cardboard, and are also expanding
our use of returnable packaging to promote the reuse of packaging materials and are reducing the weight and volume ofpacking by making more effective use of packaging components.

Training for Internal Auditors

Our internal auditors play a key role in the ongoingenhancement of our environmental management systems.
Implementing audits demands a high level of expert
knowledge and communication skills. To raise the skill levelof its internal auditors, Rinnai holds regular training sessions
led by in-house trainers on laws and regulations, internal
policies, and issues identified and corrective actions frominternal audits.

A scene from environmental training

General Training

Aiming to promote environmental contributions in its corebusinesses, Rinnai’s general training incorporates various
programs to raise environmental consciousness that are
targeted at new joiners and according to employees’ roles
and ranks.

Environmentally Conscious Design Policies• Conservation of resources• Reduce environmental impact at the manufacturing stage• Reduce environmental impact at the usage stage• Potential for recycling• Safety• Ease of collection and transport

Supply Chain Management
Compliance with Legal Regulations
While compliance with legal regulations is a given, we set more stringent voluntary standards and conduct daily
supervision and periodic measurement as well as implement environmental audits to control emissions to theatmosphere and water systems. Rinnai is strengthening the maintenance and administration of its facilities. When thepotential for a voluntary standard being exceeded is detected, we implement preventative measures for that equipment
and manage it thoroughly. When values are detected that exceed regulatory standards, we identify the root cause andimplement improvements in response to the issue.
In fiscal 2020, there were no legal violations related to the environment, such as laws related to pollution control.

35

With the social environment changing toward the achievement of a sustainable society, environmental activities that
extend beyond the scope of our Group and into our supply chain are important for sustaining our business moving
forward. Through Rinnai’s Green Procurement Standards Guide, to which we request all of our suppliers comply, we
convey our thinking regarding green procurement policies and also work to improve environmental management throughour daily interactions with them.
In fiscal 2020, we surveyed the status of environmental impact data and environmental activities at 350 business
partners through a questionnaire.

Rinnai Report 202036

Environment

Environmental Initiatives

Prevention of Global Warning
Major changes in climate patterns due to global warming and other factors are threatening the building of

Initiatives to Reduce Energy Consumption at Worksites

sustainable societies. Rinnai is undertaking initiatives to minimize its energy consumption toward the achievementof the targets it has set for 2030.

Contributing to Energy-Saving through the Diffusion of Environmentally
Friendly Products
Rinnai has set a long-term target of contributing to 27% reduction in CO2 by 2030 to conserve energy at “the usage

Rinnai targets a 4% reduction in the base unit of energy use*2 by fiscal 2021 versus the benchmark year. The reduction in
fiscal 2020 was 9.7%, so we were able to achieve the target before the final year of the target. We were able to achieve
this target through energy-saving activities undertaken each summer at all worksites and as well as stepped-up initiatives
to save energy in manufacturing facilities, lighting, and air conditioning, while also working toward strict loss reductions ineach manufacturing process.
*2 Per-unit energy consumption: Per-unit standard of energy consumption as defined by Rinnai

stage” where CO2 emissions are largest in the product lifecycle and thus and contribute to the environment throughits products.

At the 2nd EcoPro Awards organized by the Japan Environmental
Management Association for Industry, the Rinnai Group received an“Honorable Mention” for its development of “hot water and heating
systems that address the energy and environmental conditions ineach country and region”. Rinnai was recognized for its efforts to
spread boiler heaters that are equipped with measures to combat air

Transportation

Standby

Packaging

Assembly

Materials
Shipment

Painting

Rinnai has established energy management policies andtargets as a business operator specified under the Act on
the Rational Use of Energy and is practicing rational energy
use. Promoting rectification in our craftsmanship is leading
to higher productivity and lower total energy consumption.
Based on its fully integrated manufacturing system, theCompany is boosting energy efficiency from pressing
through to the assembly and packaging stages with themindset that “all losses lead to energy loss”.

Sheet metal work

Rinnai Receives “Honorable Mention” at EcoPro Awards

Pressing

Efficiency-raising Activities through Fully Integrated Manufacturing (Rectification)

Shipment

Inventory

Waste
All kinds of losses lead to energy loss

pollution (PM 2.5 measures) in the Chinese market, its nationwide
activities to provide installation training to promote the adoption ofhighly efficient hot water heaters in the United States, and for the

EcoPro Awards Ceremony

development in Japan of the ECO ONE water heater and heating system that minimizes the consumption ofPrimary Energy-conservation Initiatives

primary energy *1 since it does not rely on either electricity or gas alone as a single source of electricity.
*1 Primary energy: Energy acquired is from its natural state, such as coal, petroleum, and natural gas. Primary energy consumption can be used to compare equipment using
electricity, gas, and oil, etc. under the same conditions and has recently been used as a standard for comparing energy-saving housing.

Manufacturing

Press release (link: https://www.rinnai.co.jp/releases/2019/0926/images/releases20190926.pdf) (in Japanese only)

Certification as “Low-NOx and Low-CO2 Small-scale Combustion Equipment” by the
Tokyo Metropolitan Government
Rinnai’s water heaters have been certified by the Tokyo Metropolitan Government as “low-NOx and low-CO2 small-

Office• Eliminating wasted energy in assembly tasks that use make-shift mechanisms• Improving usage efficiency in painting and drying processes• Optimizing compressor operation• Integrating manufacturing facilities, other• Upgrading to LED lighting and removing unnecessary lighting• Managing air conditioner temperature and use• Reducing air conditioner loads by applying heat-insulating paint• Implementing “Cool Biz” casual dress policies• Green curtains, otherscale combustion equipment” by the Tokyo Metropolitan Government. “Low-NOx and low-CO2 small-scale
combustion equipment” have been certified for meeting standards for both NOx emission concentration andenergy efficiency, and the certification was established to encourage the diffusion of such equipment.
Bureau of Environment, Tokyo Metropolitan Government (Link: https://www.kankyo.metro.tokyo.lg.jp/air/air_pollution/torikumi/nox_co2/nox_co2.html (in Japanese only)

37

Rinnai Report 2020

38

Environment

Environmental Initiatives

Prevention of Global Warming
Use of Renewable Energy

Eco-Friendly Driving Initiatives

The Rinnai Group encourages the use of renewable

We have introduced a system for quantifying andenergy, including solar and wind power, at its locations

centrally managing fleet operations at our sales

both in Japan and overseas.

offices nationwide to encourage safe and eco-

The total amount of electric power generated fromfriendly driving. The system is designed torenewable sources in fiscal 2020 was 430,000 kWh.

automatically email managers if a driver drives
too fast, accelerates rapidly, or brakes suddenly.
It has improved average fuel economy byapproximately 5% compared with before it was
introduced and has resulted in a decrease intraffic accidents and violations on public roads.
In addition, we hold regular training on ecoSolar power generation equipment (Tohoku Branch)

driving for employees and have posted anti-idling

Screen of vehicle monitoring system (average fuel economy and CO2 emissions)reminders in Rinnai’s parking lots at worksites nationwide to encourage employees and business partners tocooperate in eco-driving.

Improvements to Logistics
Encouraging Eco-Friendly Commuting
As a consigner specified under the Act on the Rational Use of Energy, Rinnai is working to improve its logistics
based on a rationalization plan it has formulated for energy use. The Group’s products are made at its factories and

The Technology Development Centersold throughout Japan, while some are exported to other countries in Asia, Europe, North America, and beyond.

encourages employees to voluntarily commute in

The key to Rinnai’s logistics network, the Integrated Logistics Center, is working to appropriately manage energy

an eco-friendly manner by designating certain

conditions related to distribution and reduce energy consumption by improving logistical efficiency.

days as “no car days.” On these days, employees
come to work by public transport or bicycle inPrimary Initiatives Being Pursued• Expanding consolidated shipping within
the Group• Reviewing and adjusting product delivery
routes• Effectively using round-trip shipments• Using modal shifts*• Increasing stacking per pallet• Encouraging eco-driving

order to reduce CO2 emissions and the noise
pollution caused by traffic congestion near thecenter.
This initiative not only lessens the impact on
the environment, it also contributes to employee
health by encouraging moderate exercise.
Bike racks at the Technology Development Center*M odal shift: A shift in transportation method from trucks
to large-capacity modalities, such as railway or ocean
shipping

Rinnai’s Integrated Logistics Center

39

Rinnai Report 202040

Environment

Environmental Initiatives

Resource Recycling
From the perspective of intergenerational equity toward the creation of a sustainable society, there is a requirement

Industrial Waste Processing

to consume resources only to the extent that the resource needs of future generations may be met. Rinnai is
continually working to develop equipment that conserves resources while aiming for zero emissions*1 (zero waste
disposed of in landfills) and reducing the amount of waste it produces. Furthermore, it recognizes water is a precious
resource and is involved in initiatives to reduce water used sourced from both water works and groundwater.
*1 Rinnai’s definition of zero emissions: Recycling rate at manufacturing bases of 99.5% or higher (less than 0.5% going to landfills)

Initiatives to Reduce Waste
Rinnai targets a 4% reduction in the base unit of waste production*2 by 2020 versus the benchmark year.
The reduction in fiscal 2020 was 1.6% versus the single-year target of a 3% reduction. We were unable to reach oursingle-year target due to an increase in scrap volume associated with increases in construction of welfare buildings andproduction for new products. However, as we work toward the last year of the initiative in fiscal 2021, we are operating
under the key assumption that raw materials deployed in our manufacturing processes will be used without waste. At thesame time, we will strengthen our efforts to turn any waste that does arise despite this once again into useable resources.
*2 Base unit of waste production: Unit standard of waste production as defined by Rinnai

Primary Waste-reduction Initiatives

Manufacturing

OfficeBoth• Improving the accuracy of material separation•C onsigning industrial waste processing to a
reputable vendor, other

Management of Polychlorinated biphenyl (PCB) Waste
The Act on Special Measures concerning Promotion of Proper Treatment of PCB Wastes requires that companies suchas Rinnai upgrade their storage of PCB, a substance used in transformer oil, and dispose of it by the end of March 2027.
We are promoting measures aimed at expedient disposal. Until PCB disposal is complete, the Company will implement
leakage prevention measures in preparation for possible equipment failures during storage. We also diligently lock up
facilities to prevent loss and conduct proper labeling.

Semi-Closed Processing in Enamel Processing Lines• Introducing lightweight designs(reduce the amount of materials used)• Increasing yields by raising the effective
utilization rate for pressed components(measures aimed at the root cause)• Effectively using leftover materials• Reducing defect rates• Raising the recovery rate of residual chemical
agents• Making transport materials returnable• Eliminating excessive packaging, other• Promoting a shift to paperless work processes• Curtailing the use of disposable andconsumable materials• Raising awareness by letting employees see
how many copies they make and how muchthey cost

When reaching agreements with waste processing subcontractors, Rinnai conducts strict inspections involving elements
such as their financial condition and on-site confirmations. In addition, we visit our processing subcontractors each year
to verify that they are conducting appropriate waste disposal. Once there, we confirm how manifests that contain
information regarding different varieties of waste, their disposal methods, and processing statuses are being
administered. We also conduct on-site confirmations regarding waste processing and exchange relevant information
with the subcontractor.
In fiscal 2020, the Company visited 44 locations to verify that proper waste management was being conducted.

To enhance resource recycling in factories, it is important to “build a framework for not producing waste in factories orprocessing or reusing it all within the factory”. Noto Tech Co., Ltd., a Rinnai Group company, has succeeded in the inhouse processing of waste liquid that was previously outsourced by reviewing the process flow in its enameling lines.
Furthermore, at the wastewater treatment facility, the liquid is reformed such that it can be used as “coagulatingchemicals”, leading to a large reduction in environmental impact and costs.

Major Initiatives
Eco House (Oguchi Factory)• In-house processing and chemicalization of liquid wastes emitted
from enamel lines• Filtration and reuse of glaze wastewater (treated effluent)• Deployment of filtration equipment in front-end process lines
Impact• Industrial waste emission volume -147 tons (-61%)• Water usage -4,260m2 (-91%)
Wastewater treatment facility (Noto Tech Co., Ltd.)

41

Rinnai Report 202042

Environment

Environmental Initiatives

Recycling Initiatives

Concern for Water

At least 80%-90% of the materials used to make gas
appliances consist of recyclable materials such as iron andcopper. Gas appliances that have reached the end of theiruseful lives are collected and disposed of through twochannels: by local authorities in the case of appliances that
require no installation work, and by contractors in the case of
appliances that do require such work. The Environmental andRecycling Action Committee formed by the Japan Industrial
Association of Gas and Kerosene Appliances, of which we area member, regularly surveys the state of disposal of end-of-life
gas and oil appliances.
The committee’s surveys include confirmations andObserving a processing plantexchanges of information on questionnaire formats andconfirms recycling verification tests at recycling plants as well as the status of disposal. It thus confirms that end-of-life
gas and oil appliances are being disposed of appropriately and that a high level of recycling rates is being maintained.
Such survey results are beneficial to the design and enhancement of our products.

Rinnai recognizes water as a critical resource and its
working to reduce its usage of both public water andgroundwater in its business activities. In addition, it
endeavors on a daily basis to save water and use
circulating water while undertaking thorough drainage
water management to ensure the water it uses does
not harm the environment.

Primary Initiatives to Reduce Water Usage• Using water-saving functions at facilities that use water• Creating and using frameworks to increase the volume
of circulating water• Improving awareness of water-saving (banning leaving
faucets running, etc.)• Utilizing rain water, etc.

Assessing and Understanding Water Risk
As the world’s population increases and urbanization andindustrialization continue to progress, there is concern that humanity
知っておこう 水リスク
今
may face water shortages. To respond to business risks associatedwith water, Rinnai is identifying business locations with high water risk
0.01
3.9
40
both domestically and internationally using a water risk assessment
tool known as Aqueduct*3 and sharing the results of analyses
performed with the tool. Rinnai, while focusing on the risk conditions
in each region, views reducing water usage as an opportunity to cut
manufacturing costs and is working to mitigate water risk while also
reducing manufacturing costs. In addition, Rinnai is working to protect Distributing information on “water risk” as a theme in the in-houseenvironmental newsletter
water resources in its supply chain in recognition of the impact water
shortages can have on materials supplied by its business partners.
We have therefore set criteria related to water resources in the Green Procurement Standards Guide, which outlines
the environmental activities that we ask our business partners to participate in.
vol. 55 2018 AU TU MN

主な水リスク（ 得 点 制 ）リ ン ナ イ の 色 ん な 活 動 と「 環 境 」を 結 ぶ

v o l .5 5 2 0 1 8 AUTUMN( 飲み 水・生活水・工業用水含む)

実は、次の環境問題として注目され

2 洪水が 発生しや す い ( 降雨量・地盤)ています。
リンナイは、「水に関するビ

3 劣悪環境 の下流域に位置する4 水源に戻る水 の割合が 低い

ジネスリスク」に対応していきます。

( 処理プラントやインフラ整備状況)

SDGS

1

CHE CK.

CHE CK.

多水の 利 用 量倍%

世界の水需要

日本A拠点

アジアA拠点16

高リスク拠点

アジアB拠点12

中

地球上に存在する水は約14億㎦

は年々増大しています。

は約2.5％にすぎません。

西アジアや北アフリカを中心に、水不足が深刻化すると言われています。

その需要は、2025年には約3.9倍を見込んでいます。
（1950年比）

淡水のほとんどは南極や北極の氷で、私たちが利用できる河川など

少（ 利用できる水にゆとりのない状 態 の 人々）

人口増加とともに世界の水使用量

で、その約97.5％が海水であり、淡水の水はわずか0.01％です。

世 界 の 水ストレス（ 水を必 要とする人々）

3.9 倍

1950 年

8

1,3

1.4 倍

億人が、水不足や水ストレスに直面

水リスク拠 点 の 特 定 方 法

縦軸リンナイグループの事業影響度

0

10

15

20

中

25

高

水リスク

（得点）

は早急な対策が必要です。

環境部より、別途、改善のお願いをしていきますのでご協

力をお願いします。

今 から、できること

各 事 業 所 で節 水をRecycling Home Electrical Appliances

2

アジア

北米

3

欧州

世 界 的な人口増 、工 業 化 の進 展 、そして
気 候 変 動が 原 因で、世 界 的に水 不 足にリン ナ イ

緑 花 通 信E・プロキュアメント
（ 調達 ）

4

アフリカ

5

南米

6（千km3）
オーストラリア・オセアニア！
それが 水リスク ！

リンナイは、伝統野菜づくりを応援していますまた、水のビジネスリスクに対応するため、事業所の立地（水リスク）と、

Report on Recycling Specified Household Appliances (link: https://www.rinnai.co.jp/csr/result/index.html) (in Japanese only)

こんなに種がとれるなら、来年は、部門対抗の「緑のカーテンコンテスト」
ができるかな…
術センターで
技 100
0粒

は
た種
れ
と 上！
以

Japan’s Home Appliance Recycling Law went into effect in 2001 with the goals to reduce the amount of waste going tolandfills and incinerators and to promote more effective use of resources. Since then, old appliances thrown out by
consumers have been recycled into new products. Rinnai now has two products—a unit-style air conditioner and aclothes dryer—that fall under the category of recycled products.

配り、自宅で育ててもらっています。

E・オフィス（事務所）

全員参加で、水への配慮を進めていきます

水の利用量を確認してみましょう。

地元の土ですくすくと育ち、毎朝収穫しました

せいぶつ た よう せいです。希望者へ、全国地域の伝統野菜の種を

E・サービス（施工・修理）E・マインド（従業員）

リンナイの 環 境 行 動 計 画 “ 7 E 戦 略 ”

毎日の生活の中で、水を大切に使いましょう。

「地産地消」は、生物多様性の観点からも重要

職 場・家 庭にみどりを増やし、E・プロダクト（環境配慮
設計）

E・ファクトリー（工場）

E・マーケティング（販売）

地域で生産されたものを地域で消費していく

その地 域の植 生を知ろう！

リンナイは …

今 後 のビジネスリスクに備え
サプライチェーンへも要 請を！

すると予測されています。

5,1

1

(点)

拠点」
2軸でマッピングしたものです。グラフの中の「高リスク拠点」

3,7

世界の 60％横軸

水リスク(水の利用量(㎥))1995 年2025 年（予想）

黒左のグラフは、
リンナイグループの国内外拠点を、上記のの低

3

CHE CK.

2025年には約28億人が、2050年には世界人口の約40％に当たる約40

薄い黄

異なります

対象：リンナイグループ拠点（国内外）4

実際に、人が利用できる水量

濃い黄

今 、リンナイでは…
20

%

赤

オレンジ

低リスク

2

（万㎥/年）

今 、水 不 足 が 大 変なんです

高リスク

データなし

地球上に平均的に存在する温室効果ガスにと違い、水は「地域」
よってリスクの大きさがデータ出所：世界資源研究所（WRI）、
使用ツール：AQUEDUCT（アキダクト）
http://www.wri.org/our-work/project/aqueduct/

今回、該当するの世界の水リスク（現状）赤色（高得点）ほど水リスクの高い地域です1 安全な水が 入手できない

毎日ストレスなく利用している「水」。

【愛知伝統野菜】
十六ささげ（じゅうろくささげ）
実が柔らかく火も通りやすいので、茹でておひたし、ゴマ和えに（期限：今年中）プレゼント付アンケートを実施します！

ecoのコエ【夏号と秋号】に関するアンケートに答えて応 募すると、先着100名様に、自宅で育てられる

伝統野菜の種などを差し上げます。

応募はこちら（アンケート画面）

ecoのコエvol.54
【夏号】
はこちら

*3 Aqueduct: A water risk atlas and information tool provided free of charge by the World Resources Institute (WRI)

Recycling Containers and Packaging
Managing Drainage Water Quality
Under the Containers and Packaging Recycling Law, which seeks to make more effective use of resources,
manufacturers and businesses that use the products are required to recycle product containers and packaging discarded
by households. In accordance with the law, Rinnai has outsourced the recycling of containers and packaging todesignated businesses that undertake associated services on the Company’s behalf.

To ensure that the water we dispose of at drainage treatment facilities
does not impact aquatic ecosystems, such as those in rivers, we
conduct drainage water management with voluntary standards thatare more stringent than those required by law.
When there is a potential for voluntary standards to be exceeded,
we identify the root cause with the person conducting themeasurement and implement preventative measures on the facilities
in an effort to perform thorough management.
Responding to water quality inspections

43

Rinnai Report 2020

44

Environment

Environmental Initiatives

Pollution Prevention
Some chemical substances can have a negative impact on ecosystems and human health if they are not managed

Preparing for Emergencies

appropriately and accumulate as environmental pollution over long periods of time. Aiming to minimize the use ofchemical substances that may affect people and global environments (atmosphere, water areas, and soil), Rinnai
conducts management in accordance with both customer demand and each individual country’s regulations
throughout the lifecycles of its products.

All offices run annual drills premised on adverse events, such as environmental accidents. To minimize environmental
pollution risk, we have also reviewed procedures setting out actions to take in the event of a crisis and have preparedemergency provisions.

Promoting Management of Products Containing Potentially Harmful Chemical Substances
Companies are being required to appropriately understand and manage
the overall supply chain for the chemicals used in their materials andproducts. The Rinnai Group endeavors to appropriately manage
information concerning products containing potentially harmful chemicals
along with its suppliers. The Company conducts this management basedon its Green Procurement Standards Guide (E-Procurement Standards
Guide) and its Chemical Substance Management Guidelines, which
address regulatory concerns regarding green procurement and chemical
substances contained in procured materials, respectively.

A scene from the response committee on the Restriction ofSpecified Hazardous Substances directive (photo taken on
December 11, 2019)
Scenes from emergency response training (Left: Minami-Kanto Branch, Right: Yanagisawa Manufacturing Co., Ltd.)

Initiatives to Reduce the Environmental Impact at Factories
To minimize the impact on the environment, Rinnai is reducing and eliminating the use of hazardous chemical substances
through such initiatives as reviewing the chemical compounds used in
Atmospherethe relevant manufacturing processes and improving processing
equipment. At each manufacturing site, we check and manage theamounts handled, released, and transferred of the 462 Class 1
Products
Chemicalchemical substances designated under the PRTR* Law, for which 500
substances
Waste
kg or more is handled each year.

Inspection of Environmentally Critical Facilities
We prioritize inspection of facilities that have a risk of impacting the environment and conduct inspections on suchenvironmentally critical facilities on a regular basis. We work to prevent serious accidents that could have an impact on
the environment by inspecting individual facilities, verifying measuring equipment is working as expected, and conducting
simulations of emergency situations.

* An abbreviation for Pollutant Release and Transfer Register. The law stipulates that business operatorscompile and submit documentation on the amount of specified chemical substances known to be
Water areas
Soilpotentially harmful that has been released into the environment (into the atmosphere, water areas, or soil)
or moved o site as waste. There are similar regulations in other countries. In Japan, the law was
Flows of Release and Transfer of Chemical Substances (PRTR Substances)established in 1999 and revised in 2009.

Main Initiatives to Reduce Harmful Chemical Compounds

Manufacturing-related45• Introduction of environmentally friendly painting equipment in line withconstruction of a new factory• Optimization of piping routes for color change valves and paint guns
• Review of processing oils, other

Rinnai Report 2020

46

Environment

Environmental Initiatives

Protecting Biodiversity

Japan Business Federation (Keidanren) and are working to protect the environment.

Approach to Protection of Biodiversity

Rinnai promotes activities that contribute to theprotection of biodiversity through its daily efforts
to reduce environmental impact (e.g., CO2, waste,
atmosphere, water) in its business activities at
each worksite.

We have incorporated “consideration for biodiversity” into our ISO 14001 environmental policy and are pursuing action inaccordance with the following principles.

Business activities

OutputCO2

Use of mineral
resources

Greenhouse effect gas
Use of energy

Design, manufacturing

Chemicals(fuels, electricity)

NOx
Use of biologicalresources

Raw materials
procurement

Transportationand sale

Soot and dust

Impact on Biodiversity

Recognizing that business activities and biodiversity are interwoven, we support the Declaration on Biodiversity by

Input

Release into the atmosphere

Business Activities and Biodiversity
Dependence on Ecosystem Services

Protecting the biodiversity that underpins social sustainability has become an urgent priority for humankind.

Waste
Use of water
resources

Collection, disposal,
and recycling

Use of products
by customers

Drainage
Noise and vibration

Use of land

Rinnai Principles on Biodiversity

Relationship between the Rinnai Group’s Business Activities and Biodiversity

1. Recognition of theissuesRinnai regards protection of biodiversity as a priority for corporate survival andincorporates it into its environmental policy.

2. Cultivation ofawareness

Rinnai is committed to deepening understanding and cultivating awareness of
biodiversity by creating opportunities for contact with nature, including throughpreservation and greenification activities undertaken around Company premises.

3. Pursuit of businessactivities contributing
to biodiversity

Rinnai recognizes that business activities and biodiversity are interwoven, and aims
to develop conditions that allow biodiversity to be preserved through greater action
to reduce environmental impacts.

4. Disclosure of
information

Rinnai will publish details, both internally and externally, of its policy on and initiatives
to protect biodiversity, and aims to develop cooperation with local communities.

Extermination of Coreopsis Lanceolata, a Specified Invasive Species
During Environment Month in June, Rinnai works together with local government bodies,
volunteers, and employees of neighboring companies to collect and dispose of thespecified invasive species Coreopsis lanceolata .
Specified invasive species are living organisms that the Japanese government hasdetermined to pose a risk of harm to ecosystems when they are introduced from otherregions. Their cultivation, preservation, import, transport, and breeding are prohibited. In
fiscal 2020, a total of 69 volunteers properly disposed of approximately 360kg of Coreopsis
lanceolata. Rinnai intends to expand this activity moving forward.

“Let’s Grow Heirloom Vegetables Together” Receives Award at the Biodiversity Action
AwardsInvasive species Coreopsis lanceolata

Initiatives to Register Nijyu-maru Project*2
Rinnai received an Award at the Biodiversity Action Awards 2019 organized by the Japan Committee for the United
Nations Decade on Biodiversity (UNDB-J) in recognition of its program in which employees and their families arecultivating heirloom vegetables*1.
*1 Heirloom vegetables: Vegetables long popular in a particular locality, such as those grown in Kyoto and the Kaga region (Kanazawa)

Rinnai supports the objectives of the “Aichi Biodiversity Targets” andencourages registration in the Nijyu-maru Project. Up to now, fiveprojects have been registered and these initiatives are under way
globally.
*2 Nijyu-maru Project: A framework in which citizens’ organizations, companies, local authorities, andothers state and register their declaration to do what they can to contribute to the Aichi Biodiversity
Targets (Nijyu-maru declaration) (Organizer: International Union for Conservation of Nature (IUCN))「愛知ターゲット」の目標 1 「普及啓発」・目標 2 「各種計画への組み込み」・目標 3 「補助金･ 奨励措置」・目標 4 「生産と消費」
目標 5 「生息地の破壊」・目標 6 「過剰漁獲」・目標 7 「農業･ 林業･ 養殖業」・目標 8 「化学汚染」
目標 9 「外来種」・目標 1 0 「環境変化に弱い生態系の保護」・目標 1 1 「保護地域」・目標 1 2 「種の保全」
目標 1 3 「遺伝的多様性」・目標 1 4 「生態系サービス」・目標 1 5 「復元と気候変動対策」・目標 1 6 「A B S 」
目標 1 7 「効果的･ 参加型戦略」・目標 1 8 「伝統的知識」・目標 1 9 「知識･ 技術の向上と普及」・目標 2 0 「人材･ 賃金」の達成に多大なる貢献をしていることを表彰し、大きな ◎ をお贈り致します。
◎ の周りにたくさんの人たちが集まり、 ○ がもっと増えますように！

Award logo

47

Employees and their families cultivating heirloom vegetables(photograph provided by an employee)

A scene from a cooking class using heirloom vegetables
harvested on Company grounds and DELICIA (Rinnai’s gas stove)

Rinnai Report 2020

48

Environment

Environmental Initiatives

Environmental Communication
We use regular communication and exchange events as a means of building awareness of the Rinnai Group’s

Exchange Events (Visits) to Learn from Corporate Environmental Pioneers

environmental activities in order to deepen our ties with and be a trusted member of our local communities.
Furthermore, Rinnai sets June as Environment Month and holds various environment-related events to further
enhance the environmental consciousness of its employees

Exhibit at EcoPro Environmental Exhibition
The Company has taken part in the EcoPro exhibition
since 2013, the environmental exhibition hosted by
Nikkei Inc. and the Japan Environmental Management
Association for Industry. This exhibition features many
elementary and middle-school students on field trips inaddition to businesspeople and the general public.
At EcoPro 2019, nearly 2,000 elementary andmiddle-school students visited the Rinnai booth andwere able to deepen understanding on ourenvironmental and energy-saving products throughthe way energy is used in the home.

Once per year, to coincide with Environment Month inJune, we organize an exchange event (visit) with acorporate environmental pioneer in order to learn aboutother companies’ environmental technologies andfacilities, and to create opportunities for personnel
involved in environmental matters to share ideas andinformation.

A scene from a visit to a corporate environmental pioneer

Rinnai Group Environmental Awards Programs

Rinnai’s booth at the EcoPro exhibition

Factory Tours
Rinnai is conducting factory tours to inform the public about
its various endeavors, including its environmental activities.
We are providing tour participants with the opportunity tounderstand more about our environmental initiatives, quality
control, safety policies, and manufacturing by allowing themto view our facilities and by conducting Q&A sessions
afterward.

The Rinnai Group Environmental Awards are held
annually to recognize outstanding environmental activities
and stimulate more action on the environment throughout
the Group. These awards recognize major contributions
to the environment and society and are open to all ouroperations in Japan and around the world. The 10th
awards ceremony was held at the Rinnai Group New-Year
Convention, at which Rinnai’s CEO presented the awards.
In fiscal 2020, there were a record 128 entries
submitted, from which one Grand Prize and 11 categoryspecific awards covering manufacturing, office, sales, andsocial contributions were selected.

Rinnai’s CEO presenting the Rinnai Group Environmental Awards

Cleanup and Greenification Activities around Company Sites
Group employees periodically engage in cleanup and greenification activities around the Group’s factories and along
their commuting routes to help look after the natural environment around its operations.

A scene from a factory tour

49

Rinnai Report 202050

Special Issue

02 [Quality]

Linkage with SDGs

Taking Pride in Monozukuri (craftsmanship)
Rinnai Group products for sale in Japan and a portion those for export markets are manufactured primarily at its Oguchi
Factory in Oguchi-cho, Aichi Prefecture, and its Seto and Akatsuki factories, both in Seto City. Among the products Rinnai
provides, heating equipment requires particularly careful quality control and therefore burner units and other key parts are
manufactured within the Group.
Furthermore, our product development and design departments are located primarily in our Technology
Development Center (Oguchi-cho), where products are not only designed but tested with a robust array of testing
facilities. Daily innovations occur on the production side as well at our Production and Technology Development Center(Komaki City). This organization researches how to reduce the costs and improve the quality of items such as dyes,
production equipment, and parts.

Seven points of pride
1. In-house design and insourcing
Key components are designed and manufactured in house. In addition,
the dyes, facilities, and software required for insourcing are also made by
Rinnai, depending on the status of production. Doing things
independently ensures that technology and skills are accumulated andpassed on and leads to the birth of even better products.
2. Modular design
We are promoting modular design by concentrating elements andfunctions and standardizing them along set units. Simplifying assembly
improves the quality of assembly and processing, while standardizing
supports cost reductions.
3. Painstaking inspection systems
Every product we make is inspected by automated equipment and bycertified inspectors who have passed rigorous internal standards. In
addition, each process includes error-prevention equipment thatprevents the flow of defective products down lines.
4. Local production
We are proactively promoting local production and local sales. This
reflects our ongoing efforts to provide products that address local
needs; create employment opportunities; mitigate risks by enablingsustained production during pandemics, natural disasters, and othercrises; while also contributing to society and improving Rinnai’ssustainability and growth potential.

5. Fully integrated production
Handling all steps from processing to assembly, packaging, andshipment at our own factories enables us to realize high-quality productmanufacturing in all processes. In addition, Rinnai is capable of multiitem, mixed-line production and can respond to market needs withagility by flexibility producing only the required amounts when they areneeded.
6. Automation that can handle a variety of products
Rinnai handles a wide variety of products, for example, with gas
equipment there are various types of gases used, heat settings forstoves, and variations in exhaust for hot water heaters. Since these are
made in mixed-line production facilities, we have highly advanced
automation technologies to handle this production.
7. Skill management (talent development)
In our view, quality is created by superior technology and skill but above
all at a well-equipped and organized work environment. With a focus on
3S (Sorted, Straight, and Sanitary) and 5 Sets (set position, set form, setquantity, set product, and set time), each employee strives to create asafe and high-quality workplace.

We are providing high-quality products by keeping faithful our pride in monozukuri.
When customers use our high-quality products, we are supporting peace of mind andsafety in their lives.

Enhancing monozukuri and quality by strengthening touchpoints with customers
Planning and development of products,
business models, and services
Business Planning Division

Planning
Department Business model planning

Functionality
improvement

New Business Strategy Office

Development
Department Advanced development andresearch into elemental technologies

Customer Division

QualityGathering opinions on products
Department and services and information
on equipment

Communication Design Office

Sales
Department Enhancing touchpoints
with customers

51

Touchpoints with customers

and development

Nationwide
customers

Quality
improvement

Proposingnew products
and services(Achievement of CSR materiality
target indicators)
We are able to achieve our goal of zero
defects by fully integrating processes
from product planning and design
through to manufacturing within the
Rinnai Group. In fiscal 2020 Rinnai wasonce again had zero cases of defects that
led to recall notices, which is an importantmateriality issue for companies.

Rinnai Report 202052

Special Issue

03 [Safety and Peace of Mind for Consumers]

Linkage with SDGs

With the World’s Highest Standard forEnvironmental Performance,
ECO ONE Takes the Best of Gas andElectricity to Help during Disasters

A hot water heater that is resilient todisasters, ECO ONE is a hybrid hot waterand heating system that protects andsupports people’s lives.

Electricity

Disasters strike unexpectedly. Consumers canprepare for emergencies by installing hot water
heaters that can work with both gas and electricity,and thus diversify risk so lifestyles can be sustainedeven when lifelines are limited.

Gas(High-efficiency
water heaters)(Heat pumps)

Highly efficientand energy-saving

Powerful andspeedyIt boosts the efficiency ofelectrical energy by using
hot air.

It packs a punch andshows its power when lotsof hot water is used orwhen hot water is used forheating.

What ECO ONE can do during a disaster

When the power is cut off

When the water is cut off

If there is power generation from cars or solar panels,
gas can be used to heat water

Hot water in the tank can be used as domestic waterElectricity

The year 2019 was marked by many natural disasters. This gave consumers the opportunity to think more deeply aboutrisk management for disasters and heightened momentum to prepare for them on a daily basis.
January 3: Earthquake in Kumamoto region of Kumamoto Prefecture
February 21: Earthquake in middle east Iburi region in Hokkaido Prefecture
May 10:Earthquake in Hyuganada, Miyazaki Prefecture
May 25:
Earthquake in southern Chiba Prefecture
June 18:
Earthquake of the coast of Yamagata Prefecture

Have notexperienced
power outages
30%
Have experienced
power outages
70%
Total (n =1,403)

Have experienced
power outages

Have not experienced
power outages

85%

15%

Earthquake
damage(n933)
Water
damage(n117)
Typhoondamage(n353)
0%

20%

69%

31%

69%

31%

40%

60%

80%

100%

Experience withwater outages

Have notHaveexperienced experienced
water
water
outagesoutages
57%
43%

Total (n =1,403)

Source: EnviroLife Research Institute, Inc., 201953

Experience with water outages (by type of disaster)Have experienced
water outages
Earthquake
damage(n933)
Water
damage(n117)
Typhoondamage(n353)

36%

43%

20%

Gas

ECO ONE

When the gas is cut off

When both electricity and gas
are stopped

If there is a storage battery, water can be heated with electricity

Electricity

ECO ONE

Gas

Image of hybrid lifestyleduring power outages
During a disaster, by using solar power generationand ECO ONE, electricity can be used to preserve
foods and for nighttime lighting while gas is used
for heating water and cooking.

Electricity

Solar power
generation

Storagebattery

ECO ONE

Gas

Solar power generation

Emergency powersource up to
1,500W

Gas water heating
possible
Cooking is also
possible

Night-time lighting Information
Food
preservation (rechargeable gathering
LED, etc.)
CookingHeating water

ECO ONE

Gas

57%

29%
0%

Have not experienced
water outages

64%

Cigarette sockets

Supplying
hot water
withelectricity

According to a survey, 70% of respondents have experienced power outages during disasters. By type of disaster, 85% were due toearthquake damage, 69% to water damage, and 69% to typhoon damage. In addition, 43% of respondents have experienced water
outages during disasters. By type of disaster, 64% were due to earthquake damage, 43% to water damage, and 29% to typhoon
damage. It is apparent from this data that situations where lifeline services are interrupted occur frequently.
Experience with power outages (by type of disaster)Power outage
response units

Hot water can be supplied with electricity alone

August 4: 		
Earthquake of the coast of Fukushima Prefecture
Around August 26-28: Torrential rains in Kyushu
Around September 5-9: Typhoon Faxai
Around October 11-12: Typhoon Hagibis

70% of people have experienced power outages and 40% have experienced water outages when lifelines are
stopped during disasters

Experience withpower outages

ECO ONE

71%
40%

60%

80%

100%

Rinnai supports customers’ safety and endeavors to help them live comfortable lives with peace of mind by providing
products like ECO ONE and the functionality built into its various products.

Rinnai Report 202054

Safe and secure

Safe and Secure Initiatives

Smooth Provision of Information through the Internet

After-Sales Services

Rinnai provides various types of information through its corporate website and product information websites.

To realize a “comfortable way of life” for all our customers, Rinnai is engaged in the provision of services that enable

We also support display optimization for browsing on smartphones and other mobile devices in an effort toour products to be used with peace of mind.

smoothly provide information in consideration of customer internet utilization circumstances.

Microcomputer Meter Reset Process Introduction

Prompt After-Sales Services

In the event of an earthquake having a seismic intensityof five or greater, the microcomputer meter
automatically switches off gas lines. After anearthquake has occurred, the steps necessary to reset
the microcomputer meter are quickly published on the
Rinnai corporate website to easily enable the reset ofthe microcomputer meter when it is safe to do so.

Approximately 580 servicemen across Japan repair Rinnai equipment. Confirming the status of service request from
customers on portable terminal devices, servicemen make an effort to complete inspections on the same day or by thenext day to provide prompt after-sales services supporting a “comfortable way of life.”

Serviceman Questionnaire Assessment by Postcard

Microcomputer meter reset process introduced on the Rinnai corporate website

Posted Reminders for Safe and Correct Product Usage
Using products for a long period of time can result in fire or injury caused by the deterioration or wearing of parts.
Furthermore, incorrect usage can result in malfunctions or injuries. To ensure customers use our products in a safe manner,
Rinnai provides warnings and displays in user manuals and on the products themselves that are useful for avoiding
accidents caused by misuse or carelessness. We also publish detailed examples on our corporate website, in an effort toprovide information that is easily understandable and draws attention in order to prevent product-related accidents.

Customer feedback questionnaires are provided
to customers requesting repair services. This
questionnaire assesses repair visit response times
and other factors determining the degree ofcustomer satisfaction with Rinnai repair services.
Customer assessment results are provided as
feedback and the results of questionnaires are
utilized effectively throughout the Company.
In fiscal 2020, 23,000 customers completed
questionnaires, which rated our after-sales
services an average of 94.6 points.

Degree of customer satisfaction with repair services

98.4

Condition of equipment after repair

93.3

Telephone response before visit

94.7

Courtesy, attitude and language

92.1

Greetings and display of identification

92.6

Prior explanation of problem or issue

98.3

Description of repair details

92.0

Cleaning up after repair and maintenance

94.6

From repair request to completion of repair

94.8

Comprehensive evaluation of service response
88

90

92

94

96

98

100 (Points)

Storage and Provision of Service Parts
Product-Related Accident Information Disclosure
In the event that a serious product accident occurs with a Rinnai product, we will promptly report the incident to the relevant
authorities in accordance with the law. We will also proactively disclose all details directly to customers on our corporatewebsite to notify and alert customers as quickly as possible in accordance with the severity and scale of damage.

55

As a general rule, we supply gas appliance components for five to 10 years after the end of production, and in some cases
for more than 10 years. The establishment of a system able to quickly deliver parts when needed is indispensable forafter-sales service enabling customers to safely and comfortably use gas appliances over the long term. The Rinnai Parts
Center, where parts are stored and shipped, maintains a large inventory of parts that uses a system to pick, pack and ship
items. It is critical that we not make any mistakes regarding part type or quantity and that we deliver items by the due date.
We promote efforts to enhance quality that include the documentation of work in a standardized document format andwork guidance based on a brochure comprising our basic rules concerning quality.

Rinnai Report 202056

Safe and secure

Safe and Secure Initiatives

Inquiries Response and Support System
In line with our basic philosophy “quality is our destiny,” Rinnai satisfies customers by “responding to requests andconsultations in a sincere, prompt and accurate manner” under the policy of “providing customers with satisfaction,

The Customer Center handles inquiries from customers via toll-free telephone numbers and emails. In fiscal 2020,
approximately 890,000 toll-free calls and 10,000 email inquiries were received.

safety and reliability.”

Basic Policies

1.	We recognize customer opinions and requests to be the highest priority issues in all
Rinnai departments.

According to comments and assessments from
customers in the fiscal 2020 customer questionnaire,
80% of customers complimented Rinnai on thepoliteness and promptness of our response to theirinquiries. Comments that were critical of our response areprovided as feedback and used to improve our services.

2.	We understand that customer complaints impact the entire Company, thus we takeultimate responsibility for the entire organization.
3.	We take customer feedback seriously, share it internally and use it as a valuable sourceof information to provide better products and services.
4.	We will always comply with laws and regulations and remain resolutely opposed tounreasonable requests.
5.	Customer personal information is strictly protected in accordance with relevant laws
and regulations and our personal information protection regulations.

Rinnai Customer Center

Customers’ Inquiries
Parts 1%Other 9%Complaints 1%
Catalog requests 1%

Industrial 1%

Customer Center

Construction methods
Air conditioners

Consultation
desk

Analysis ofcustomerfeedback
Identification andanalysis ofimportantquality issues

Service system enhancements

Inquiry
classification

Kitchens

4%

37%(Fiscal 2020)

Replacement purchases

11%

Inquiry
details

Repairs and parts

45%(Fiscal 2020)

Executives
Analysis and identification results

CustomerCenterDaily information

Consultationdesk• Repair requests• General product inquiries• Technical consultations• Customer consultations

Customers

7%

We created the Customer Center with theaim of increasing customer satisfaction(CS). We receive various inquiries, opinions
and requests directly from customers over
the telephone or through our corporatewebsite. Much of this valuable informationfrom customers is provided as feedback to
all departments as it useful for identifying
and reviewing issues related to productdevelopment, quality control, and sales andservice improvements.

Other inquiries and opinions 7%

Relevant
departments

Feedback to
manufacturing
divisions
Information
sharing

Hot water supplies

Product inquiries

45%

31%

Frequently Asked Questions (FAQ)
In response to customers who want to solve problemson their own, we created a FAQ page on our corporatewebsite. In April 2019, we updated this content, making iteasier to search.

FAQ (in Japanese only)

57

Rinnai Report 202058

Safe and secure

Safe and Secure Initiatives

Initiatives for Inspections
Rinnai Products Affected by the Product Safety Inspection System for Long-Term Use

Indoor instant gas
water heater

Indoor bath heater withgas burner

Built-in dishwasher

Course of Events Leading up to Inspections under the Product Safety Inspection System for Long-Term Use
Customer receives an explanation
regarding the system at time ofpurchase

In April 2009, Rinnai put its product safety inspection system for long-term use into effect to comply with revisions to
the Consumer Product Safety Act. We offer notifications regarding legal compliance inspections for customers who
registered their products in accordance with this system once they reach their 10th year of use. This system aims toencourage customers to have their products appropriately inspected and maintained before they deteriorate and failure
rates rise. To maintain products through maintenance and replacement, we provide safety inspection guidance regarding
our outdoor water heaters in accordance with laws and ordinances. Additionally, we recommend that customers who
regularly use target products receive inspections and make sure they understand that these products have standard
lifespans.
The Rinnai Group aims to enhance its maintenance checksystem, which employs qualified personnel to conduct
appropriate inspections. At the same time, we offer uniqueservices, such as extending product warranties for customers
who registered their household hot-water equipment with us
for an additional three years.
In addition, we work to increase customers’
understanding of our inspection program and prevent
accidents by providing information through our website andconsultations via our maintenance and inspection call centers.

59

Maintenance and Inspection
System of Long-Term Use
Products
Product safety inspection
system for long-term use
Legal inspections
conducted in accordancewith the Consumer Product
Safety Act

Safety inspections
conducted under the
product safety inspection
system for long-term use

A notification regarding inspection
timing is mailed to the customer(via standard mail or email)Staff member records necessary
information when the customer
applies for an inspection via telephone

1

2

3

4

5

6

Explanation
regarding thesystemOwnerregistration

Notification of
inspection

Application
for inspection

Processing of
application

Inspection

Owner registration conducted by thecustomer (via standard mail or online)

Customers requests inspection via a
postcard enclosed with the inspection
notification or by Internet or telephone.

Personnel visit thecustomer’s homeand conducts
inspection on theappointed day

Through central management of owner registration status to the inspection of each customer, Rinnai strives to improvecustomer satisfaction so that we can respond smoothly to any inquiries.
We protect personal information appropriately based on laws, regulations and strict management, never provide it tothird parties, and do not anonymously process information. We will continue to improve our system and management
structure to further heighten trust from customers.

Heat source device for water heating systems(FF-type) added to target products in July 2011

The Consumer Product Safety Act requires
owner registrations and (fee-based)
inspections of products marked as “specified
maintenance products” to prevent mishaps
due to degradation.

To prevent product mishaps due todegradation, we recommend that ourcustomers register and receive (fee-based)
inspections for products with “safety
inspection marks,” in accordance with laws
and ordinances.

Rinnai Report 202060

Safe and secure

Safe and Secure Initiatives

About Inspections

Five Basic Inspection Work Focus Areas and Rinnai’s Response
Five Focus Areas

Inspection work is carried out based on established inspection procedures. The accuracy of the inspection is managed
by checking the total number of work slips submitted to the customer and double checking to automatically check
whether the input data is correct when it is entered into the dedicated system. In addition to explaining the details ofinspections to customers, we also explain available options that customers should take into consideration in accordancewith the inspection results. In the unlikely event that a product is deemed unsafe to use, details regarding follow-up
inspections are mailed at a later date in an effort to prevent accidents. We strive to improve the quality of inspections
through efforts including instructing inspectors based on statistically managed data.

Customer Feedback Regarding Inspections• From appointment to completion of inspection, all work conductedaccording to the inspection manual to promote higher CS

1

Qualityinspection

Quality inspector,
quality support, legal
compliance, inspector
report2• Train qualified inspection personnel through skills management, regulartraining and technical support for inspection engineers

Customerfocus

Reflecting actual
usage and customer
feedback into products• Customer feedback is collected at the time of inspection and isincorporated into the inspection system and products• Website content expanded and manual updated to provide appropriate
information to customer inquiries received by telephone

3

Customersatisfaction

Appropriate and polite
provision of
information, etc.

• When making an appointment for inspections, we not only provide
explanations based on legal compliance and appropriate treatment
standards, we also conduct a preliminary survey, and if there is apossibility that the equipment is no longer usable, to reduce theinconvenience to customers before the inspection, we offer the customer
the option of inspection, repair or replacement• When registering a new product, we send confirmation of registration andask that customers confirm the information they submitted, establishing ameans of providing appropriate information such as a survey in the event
notification was not received. With regard to products that will require
specific maintenance with the enactment of new laws, we also send
notifications to customers and request that they register their products

Future Initiatives

4

5

61

• Check progress of inspection to ensure appropriateness, confirm all
inspection work to prevent inspection errors• Engage in customer safety activities such as alerting customers after
inspections whose equipment is prohibited from usage

Among inquiries from customers, many are of the opinion that inspections are obligatory, or free of charge, or
unnecessary because the gas company already conducted an inspection. For these reasons, Rinnai strives to raiseawareness when conducting inspections to ensure customers receive inspections with peace of mind.
There are also situations where customers who have scheduled inspections request cancellations, thus we promotea deeper desire for inspections among customers who intend to prevent accidents caused by deterioration over time anduse their products for as long as it is possible to do so.

Traditionally, manufacturers have been mainly engaged in activities such as the development, manufacturing, sales, andrepair of products. However, since the establishment of the inspection system, manufacturers have also become involved
in inspections and other customer safety activities.
In order to prevent product-related accidents due to deterioration over time, it is necessary to understand theinspection system and further strengthen inspection-related efforts. Nearing the time when full-scale inspections are
required, the number of inspections substantially increases. Utilizing the results of inspections to understand how
equipment deteriorates over many years of usage, Rinnai will make an effort to strengthen its customer safeguardsystems and reflect this understanding in future inspection notifications.

Rinnai’s Response

Safetyguidance

Establish
trust

Provide safety
guidance before
product failure, notafter• We provide guidance so that products are inspected before they fail orafter the inspection date has passed to prevent degradation. If there is no
response from the customer, inspection notifications are mailed again one
year later (targeting products requiring specific maintenance)

Based on appreciation
for many years of
product usage• For customers thinking about purchasing a Rinnai product, we provide
detailed information regarding our maintenance system in our catalogs
and on our corporate website. A registration completion notification ismailed to customers when they register their product, and in the unlikely
event of repairs, the warranty that began at registration is extended(applicable to home gas appliances). When nearing the inspection date
notifications are sent, with follow up notifications sent one year later(targeting products requiring specific maintenance) as well as a notice
regarding legally mandatory maintenance one year after maintenance isconducted (targeting products requiring specific maintenance). These
activities are useful for ensuring customer safety and security when using
our products starting as soon as they make a purchase

Rinnai Report 202062

Safe and secure

Safe and Secure Initiatives

Efforts to Coordinate an Inspection System

Inspection System Maintenance Items Required by Law and Rinnai’s Response

To adequately implement inspection, our 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 reliableinspection system.

Voluntary System Action Items and the Current Status
Action Items

Rinnai’s Current Status

Enhancement of provisionof information

We post the detailed information on maintenance and inspection system for our
products for a long period of time on our website.

Enhancement of items
to be inspected

In addition to the items of which inspection is legally required (specified
products that require maintenance), we set safety inspection products, including
home-use outdoor gas hot-water units, built-in-stoves, gas fan heaters, gas
clothes dryers, and gas fanned flue 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 ismonitored all the time not to delay the inspection schedule.

Warning after the inspection

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

“Law” refers to the “Consumer Products Safety Act” and “Ministerial Ordinance” refers to “Ministerial Ordinance on Ministry of Economy,
Trade and Industry-Related Specific Maintenance Products.” Information is as of March 31, 2020.

Applicable Law

SystemMaintenance Items

Details

Law: Article 32-19 and
18-1
Ministerial Ordinance:
Article 13-1

Establish
inspection offices

Arrange offices appropriately to ensure
efficient implementation of inspections.
Secure engineers for each office.

Law: Article 32-19 and
18-1
Ministerial Ordinance:
Article 13-2–4

Public display
and notificationof establishedinspection costs

Establish costs that do not significantly
exceed the appropriate cost when theinspection is conducted efficiently,
publish standards for determining
inspection costs, and give prior noticeof costs before the inspection, including
the breakdown of the inspection costs
and notification of the standards forcost determination.

Law: Article 32-19 and
18-2
Ministerial Ordinance:
Article 13-5–6

Preparation andmanagement of
guidance
necessary for
inspection

Prepare guidance based on inspection
standards and store with a third-party
organization.

Law: Article 32-19 and
18-3
Ministerial Ordinance:
Article 13-7–8

Ownership ofmaintenanceparts andprovision of
information

Establish and maintain a maintenanceperiod. Prior to inspection, notify
customer with regard to themaintenance status.

Law: Article 32-19 and
18-4
Ministerial Ordinance:
Article 13-9

Providinginformation
about items
during theinspection period

Make this information available to readon the internet

Implement
technical training

Regularly hold technical seminars,
conduct courses for contractors andtake measures to ensure technicalstandards.

Law: Article 32-19 and
18-5
Ministerial Ordinance:
Article 13-11

Recordinspection results

Record inspection results and store
them as a guide for three years.

63

Conveyinspection

Inspection offices: 81 locations across Japan
Certified inspectors: 628 people
Standards for determining inspection costs,
inspection costs and contact information is
published on the Rinnai corporate website

Notification: Sent when request for inspection isreceived.

12 types of guidance have been created (gasappliances: 10; electrical appliances: 2)

Law: Article 32-19 and
18-5
Ministerial Ordinance:
Article 13-10

Law: Article 32-19 and
18-5
Ministerial Ordinance:
Article 13-12

Rinnai’s Response

Inform the customer who requested
the inspection of the results in an
appropriate manner.

Guidance is managed as follows:
Gas appliances: Japan Gas Appliances
Inspection Association (JIA)
Electrical appliances: Japan Electrical Safety &Environment Technology Laboratories (JET)
Maintenance period: Conducted from 9–11 years
after production.
Notification: Sent when request for inspection isreceived. Information regarding maintenanceparts are also published on the Rinnai corporatewebsite.
Information regarding maintenance schedules
for products is provided on the Rinnai corporatewebsite (searchable by model number). This
information is also listed in the productcatalogues.
Technical training: Inspection certification
training provided to employees.
Ensuring technical standards: In addition toevaluating skills at technical seminars, we
conduct qualification renewal management andskill enhancement training.
Inspection results are recorded on written
inspection result statements.
Results are stored for seven years
Communications: Written inspection result
statements are provided to customers. This
report indicates options available based on the
results of the inspection. Moreover, customers
are informed if frequent inspections are required,and in the event the use of a product becomesprohibited, the inspection will be followed up bya phone call or in writing.

Rinnai Report 202064

Special Issue

04 [Health]Linkage with SDGs

Health Effect and Efficacy ofBathing with the Microbubble
Bath Unit
In April 2019, Rinnai formulated its brand promise, “Creating a healthier way of living” and renewed its brand logo. The newlogo is symbolic of the new Rinnai and is intended to invoke a brand image of creating healthy and comfortable lifestyles.
We have added a new theme of “health and lifestyles” to the past theme of “heat and lifestyles”. In addition, as one
message in promoting the theme of “health”, in April 2020 we launched sales of the microbubble bath unit.

Effect and efficacy of microbubbles (4): Relaxation effectSubjective comparison of relaxing effect (VAS score)

What are microbubbles?
Microbubbles are ultrafine bubbles measuring 1-100μm in diameter. They have low buoyance and spread out and gently rise like a milky cloud. As time
passes, they float to the surface and become even finer bubbles as they contract in water.
Microbubble bath unit
By affixing a microbubble bath unit between the bathtub and the water heater withdedicated circulator fittings (a device to spray hot water into the bathtub),microbubbles are generated and produce a variety of health benefits for the bather.
We have successfully gathered a variety of verification data on the benefits ofbathing with a microbubble bath unit from research by Toho Gas Co., Ltd. and
Nihon Fukushi University as well as joint verification studies conducted by Rinnai
and Professor Shinya Hayasaka of Tokyo City University, a leading medical
researcher in the field of bathing.

Effect and efficacy of microbubbles (1): Hot bath effectChange in averageskin temperature (˚C)

Change over time in average skin temperature based on pre-bathing values
+1.6
+1.4
+1.2
+1.0

High temperature sustained compared with plain bathwater±0

Prebathing

Start of rest
(Third minute ofbathing)

Rest for10 minutes

Rest for20 minutes

Plain bathwater

Microbubble
bath unit

Sense ofrelaxation+16%

Sense ofcomfort+21%

Sense ofhappiness

+22%
0

20

Removal rates for solid dirt (%)

10

Bathtub

Gas waterheaterSince the bubbles envelop themselves around the bather’s body, thetransmission of heat from the bath water to the body becomes gentler
causing body temperature to rise gradually. As the body releases heatgradually after leaving the bathtub, there is a sustained sense of warmth.
Experiment parameters
Research by Toho Gas Co., Ltd. and Nihon Fukushi University
Subjects: Seven healthy women in their 30s
Bathroom environment: Room temperature 29˚C, humidity 97%
Bathing method: Whole-body bathing for 10 minutes with bathwater at 40˚C

8We received many comments that bathing in the cloudy hot water felt like
excitement and joy bathing in a hot spring. Association with the milky waters of a hot springis believed to lead to the psychological perception of high-quality, luxury,
Subjective comparison of excitement and joy (VAS score)
anticipation, and excitement.

Sense of highquality and class+47%

Sense ofluxurySense ofanticipation

+36%
+35%

Sense ofexcitement

+40%
0

20

0

Plain bathwater

Effect and efficacy of microbubbles (3): Moisturization
Subjective comparison of moisturizing effect (VAS score)+24%

Skin feels moist

Softness ofbath water(does not irritate)

+34%
0

20

40

60

Plain bathwater65

80

People experiencing microbubble bathing offered a lot of positive
feedback including that the bathwater felt softer, the skin became moist,
the skin did not feel as tight, and moisturizing cream was no longer
needed.
Experiment parameters
Measurement: Analysis using the VAS (visual analogue scale) method
Paper: Mental and Physical Subjective Evaluation of Microbubble Bathing, 2020.
(Shinya Hayasaka: Japan Health Development Journal 2020)
Subjects: 11 adult women+15%

Skin feels fresh

100 (%)

Microbubble bathing

60

80

Experiment parameters
Measurement: Analysis using the VAS (visual analogue scale) method
Paper: Mental and Physical Subjective Evaluation of Microbubble Bathing, 2020.
(Shinya Hayasaka: Japan Health Development Journal 2020)
Subjects: 11 adult women

100 (%)

Microbubble bathing

We will continue to plan and develop products and services on the theme of “health and lifestyles” and take on thechallenge of creating healthy and comfortable ways to living.

Effects of bathing with microbubble baths
Soaking in hot water has a major impact on physical and psychological health, and there is evenresearch that found “people who take a bath everyday tend to be happier”. *1

Experiment parameters
Fiscal 2019 data from Rinnai. Stimulated dirt (a 10% blend of beef fat and carbon black) was rubbed
on the subjects’ midsections and color-difference meter measures were taken before and after
bathing. The dirt removal ratio was calculated using brightness levels before and after bathing.
Subjects: Six healthy adult men
Bathing method: Whole-body bathing for 10 minutes with bathwater at 38˚C / *Significanceprobability of less than 5% indicated a statistically significant difference.

Microbubble bathing

40

Plain bathwater

to dirty sebum clogged in pores and remove it to keep the skin clean. In
verification testing, microbubble bathing was shown to be more effectivethat ordinary bathing in removing dirt.

6

100 (%)

Microbubble bathing

VOICE

Microbubble bathing

Approximately
1.5 times

80

Experiment parameters
Measurement: Analysis using the VAS (visual analogue scale) method
Paper: Mental and Physical Subjective Evaluation of Microbubble Bathing, 2020.
(Shinya Hayasaka: Japan Health Development Journal 2020)
Subjects: 11 adult women

Effect and efficacy of microbubbles (5): Sense of

Rest for30 minutes

Removal rates for solid dirt

60

Plain bathwater

Effect and efficacy of microbubbles (2): Cleansing effect Fine bubbles affix to and remove dirt on the skin. The bubbles also stick

12

40

Even ordinary bathing has been reported to lower mental stress due tothe hot bath effect. Microbubble bathing was found to offer a greater
sense of relaxation, sense of comfort, and sense of happiness thanordinary bathing. It is also hoped to lead to better sleep as well.

When microbubbles are added to the heating effect of bathing, heat transfer is further promoted tothe body, which prevents feeling chilly after leaving the bath. The bubbles also have the cleansing effectof lifting dirt from the skin’s surface. Microbubble bathing is therefore expected to produce even better

Shinya Hayasaka
MD, PhD
Tokyo City University, Japaneffects than ordinary bathing in terms of recovery from fatigue, sleep promotion, deodorization, andother benefits. In addition, microbubbles have been found to have a positive subjective impact on themind and body *2 and also produce a softer feel in the water as well as improved moisture in the skin anda better sense of relaxation. I believe this is due in large part to the visual impact of the white bathwater
created by the microbubbles. I think the ability to experience microbubble baths in your own home will
create high-quality and healthy lifestyle.
*1 A survey of 6,000 residents of Shizuoka Prefecture by Professor Shinya Hayasaka’s research team
*2 Paper: Mental and Physical Subjective Evaluation of Microbubble Bathing, 2020. (Shinya Hayasaka: Japan Health Development Journal
2020)
Subjects: 11 adult women

Rinnai Report 202066

Management Structure
Audit System for Monitoring and Supervising Management

Basic Principles

01

Rinnai views reinforcement and enhancement of corporate governance as important management
priorities from the perspectives of strengthening competitiveness and continually improving corporate
value of the Group.

02

Rinnai takes care to preserve equality of shareholders by ensuring that their rights are essentially
protected and that those rights can be exercised smoothly.

03

Rinnai views appropriate cooperation with all stakeholders as essential to improving corporate value
and, through its business activities, strives for its own growth together with social and economic
prosperity.

04

Rinnai emphasizes highly transparent management through the swift and appropriate disclosure ofwide-ranging information while stepping up efforts to ensure that disclosure of Company information
is based on legal regulations.

05

Rinnai's Board of Directors recognizes its fiduciary responsibilities to shareholders and strives tocontinually improve corporate value though transparent, fair, swift, and resolute decision-making.

06

Rinnai encourages mutual communication through dialogue with shareholders and other stakeholders
in order to build relationships of trust with those stakeholders.

General Shareholders’ Meeting
Election and dismissal

Cooperation

Audit & Supervisory Board

Accounting Auditor

Cooperation

Election and dismissal

Audit

Director Compensation

AdviceCorporate Lawyer

Board of Directors

Election, dismissal,
and administration

Election, dismissal,
and administration

AdviceDirection

PresidentInternal Control Office

ReportManagement

Audit

Internal
Audit

Related Committees

ReportReport

Audit

ReportReportCorporate Ethics Committee
Risk Management Committee
Disclosure Committee
Environment Management
Committee and other

Executive Officers
ReportBusiness Divisions

Board of Directors
Rinnai’s Board of Directors is comprised of seven members, two of whom are outside directors, and meets once a monthin principle. The Board makes decisions regarding major management issues and also oversees business execution by
Board members. Some directors below the President serve concurrently as executive officers, whose role is to convey
decisions by the Board to executives in the relevant divisions responsible for business execution. The Board confirms
business operations and discusses issues at general business meetings and at other business meetings held on aquarterly basis. Moreover, the term of Directors is fixed at one year in order to clarify management responsibilities andincrease opportunities to enhance shareholder confidence in the Board.

Corporate Governance Structure

Election and dismissal

Rinnai recognizes the reinforcement and enhancement of its corporate governance to be important management
priorities from the perspectives of strengthening competitiveness and continually improving corporate value of the Group.
We aim to conduct highly transparent management by providing swift and precise disclosure of wide-ranging information
to all of our diverse stakeholders while endeavoring to enhance the functionality of internal bodies, such as our Board of
Directors and Audit & Supervisory Board.
The Audit & Supervisory Board is comprised of four members, two of whom are outside auditors. Audit &Supervisory Board members attend Board of Directors’ meetings and other important meetings to monitor director andexecutive organization execution of duties, the development and operation of the internal control system, and the statusof operations and property management at the head office and major offices. In addition to these duties, external accountauditors audit the Company’s accounts and verifies from a third-party perspective the legality of the internal control
system as it relates to financial accounts.

Direction

Management

Compensation limits for Directors and Auditors are
determined in accordance with the resolution of the general
meeting of shareholders. Rinnai internal regulations also
stipulate fundamental matters related to Directors’compensations, including determination procedures,
revisions, and reductions. Based on these, the amount ofcompensation for Directors is resolved by the Board of
Directors and the amount of compensation for Auditors isdetermined through deliberations by Auditors. Directors arepaid a fixed amount commensurate with assigned duties.

Compensation amounts for Directors and Auditors(Fiscal 2020)

Category

Persons

Total amount ofcompensation paid

Directors

7(2)¥286 million(14)(of which areoutside auditors)

5(2)¥45 million
(10)

Total

12

¥331 million(of which areoutside directors)

Auditors

Director salaries do not include employee salaries for directors who also serve as
employees. As of March 31, 2019, there were seven directors (including two outside
directors) and four auditors (including two outside auditors). There is a variance fromthe number of auditors shown above which is due to the inclusion of one auditor who
resigned as of the end of the 69th Ordinary General Meeting of Shareholders
convened on June 26, 2019.

67

Rinnai Report 2020

68

Leadership (As of June 26, 2020)
Board of Directors

Nobuyuki Matsui

Kenji Hayashi

Career Summary and Current Position in the Corporation:
Apr. 1985	Professor at Department of Electrical Engineering in Nagoya Institute ofTechnology
Jan. 2004 President at Nagoya Institute of Technology
Apr. 2010	Auditor at Aichi University of Education, Adviser of Aichi Prefectural Government
Office (Industrial Labor Section)
Apr. 2012 Professor at Chubu University
Jun. 2014 Outside director, Rinnai Corporation (current)

Representative Director, Chairman of the Board

Career Summary and Current Position in the Corporation:
Apr. 1972 Joined Rinnai Corporation
Sep. 1978 Director
Feb. 1980 Director, and General Manager of Corporate Planning OfficeJun. 1983 Managing Director, and General Manager of Production Technology Division
Jul. 1992 Managing Director, and General Manager of Related Business DivisionJun. 2005 Director, Managing Executive Officer, and General Manager of Related Business DivisionJun. 2006 Representative Director, Vice Chairman of the Corporation
Apr. 2017 Representative Director, Chairman of the Board (current)

Outside director, Independent officer

Current Representation in Other Companies:
Outside director at Aichi Tokei Denki Co., Ltd.

Takashi Kamio

Outside director, Independent officer

Career Summary and Current Position in the Corporation:
Apr. 1965 Joined Toyota Motor Co., Ltd.
Jun. 1996 Director at Toyota Motor Corporation
Jun. 1999 Managing Director at Toyota Motor Corporation
Jun. 2001 Senior Managing Director at Toyota Motor Corporation
Jun. 2005	Senior Advisor at Toyota Motor Corporation
President at Towa Real Estate Co., Ltd.
Jun. 2006 Director at Nakanihon Kogyo Co., Ltd.
May 2010	Advisor at Toyota Motor Corporation
Jun. 2010 Senior Advisor at Towa Real Estate Co., Ltd.
Jun. 2011 Audit & Supervisory Board Member at Central Nippon Expressway Company Limited
Jun. 2016 Outside director, Rinnai Corporation (current)
Current Representation in Other Companies:
Chairman of Sasaeai, specified nonprofit corporation

Representative Director and President and Executive

Tsunenori Narita

Career Summary and Current Position in the Corporation:
Apr. 1983 Joined Rinnai Corporation
Jun. 1991	Director, Deputy General Manager of Technology Research Headquarters, andconcurrently General Manager of New Technology Development Division
Jul. 1998 Director, General Manager of Technology Research Headquarters
Jul. 2001	Director, General Manager of Corporate Planning Division and concurrently,
General Manager of Administration DivisionJun. 2003	Managing Director, General Manager of Corporate Planning Division andconcurrently General Manager of Administration DivisionJun. 2005	Director, Managing Executive Officer, General Manager of Corporate Planning
Division and concurrently General Manager of Administration DivisionNov. 2005	Representative Director, President and Executive Officer of the Corporation(current)

Career Summary and Current Position in the Corporation:
Apr. 1967 Joined Rinnai Corporation
Jun. 1988	Director, General Manager of Technology Research Headquarters andconcurrently General Manager of Quality Guarantee DivisionJun. 2001 Managing Director, General Manager of Production Headquarters
Jun. 2005	Director, Managing Executive Officer, and General Manager of Production
Headquarters
Nov. 2005	Director, Managing Executive Officer, in charge of domestic business, andconcurrently General Manager of Marketing & Sales Headquarters
Apr. 2006	Director, Senior Executive Officer, in charge of domestic business, and concurrently
General Manager of Marketing & Sales Headquarters
Apr. 2009	Director, Executive Vice President; responsible for Research & Development
Headquarters, Production Headquarters, Overseas Business Headquarters andCustomer Division, and General Manager of Marketing & Sales Headquarters
Apr. 2010	Representative Director, Executive Vice President; responsible for Research &Development Headquarters, Production Headquarters, Overseas Business
Headquarters and Customer Division, and General Manager of Marketing & Sales
Headquarters
Oct. 2010	Representative Director, Executive Vice President; responsible for Research &Development Headquarters, Production Headquarters, Overseas Business
Headquarters, and General Manager of Marketing & Sales Headquarters
Apr. 2016	Representative Director, Executive Vice President, President’s Assistant, in chargeof Production Headquarters and Overseas Business Headquarters
Apr. 2018	Representative Director, Executive Vice President, President’s Assistant (current)

Masao Kosugi

Director and Senior Managing Executive Officer, General
Manager of Corporate Planning Headquarters

Career Summary and Current Position in the Corporation:
Apr. 1979 Joined Rinnai Corporation
Jun. 1999 General Manager of Information System DivisionJun. 2005	Executive Officer, General Manager of Information System Division and Distribution
Control DivisionNov. 2005	Executive Officer, Deputy General Manager of Administration Headquarters andconcurrently, General Manager of Corporate Planning Division, Information System
Division, and Distribution Control Division
Apr. 2007	Executive Officer, General Manager of Administration Headquarters andconcurrently General Manager of Corporate Planning DivisionJun. 2007	Director, Executive Officer, General Manager of Administration Headquarters, andconcurrently, General Manager of Corporate Planning Division
Apr. 2010	Director, Managing Executive Officer, General Manager of Administration
Headquarters, and concurrently General Manager of Corporate Planning Division
and Information System Division
Apr. 2016	Director, Senior Managing Executive Officer, General Manager of Corporate
Planning Headquarters, and concurrently, General Manager of Corporate Planning
Division, Information System Division, In charge of Administration Headquarters
Jul. 2016	Director, Senior Managing Executive Officer, General Manager of Corporate
Planning Headquarters, and concurrently, General Manager of Corporate Planning
Division. In charge of Administration Headquarters
Apr. 2018	Director, Senior Managing Executive Officer, General Manager of Corporate
Planning Headquarters (current)

69

Representative Director and Executive Vice President,
President’s assistant

Hiroyasu Naito President

Yuji Kondo

Director and Senior Managing Executive Officer, General Manager ofOverseas Business Headquarters, and in charge of Business
Planning Division

Career Summary and Current Position in the Corporation:
Apr. 1979 Joined Rinnai Corporation
Jul. 2001	Deputy General Manager of Research & Development Headquarters, andconcurrently General Manager of Electronic Research & Development DivisionNov. 2005	Executive Officer, General Manager of Research & Development Headquarters
and concurrently, General Manager of Technology Development Division
Jul. 2007	Executive Officer, General Manager in charge of Research & Development
Headquarters
Apr. 2008	Executive Officer, General Manager of Research & Development Headquarters
and concurrently, General Manager of Technology Administration DivisionJun. 2009	Director, Executive Officer, General Manager of Research & Development
Headquarters and concurrently General Manager of Technology Administration
Division
Apr. 2010	Director, Managing Executive Officer, General Manager of Research &Development Headquarters and concurrently General Manager of Technology
Administration Division
May 2011	Director, Managing Executive Officer, General Manager of Research &Development Headquarters and concurrently General Manager of Electronics
Development Division
Apr. 2013	Director, Managing Executive Officer, General Manager of Research &Development Headquarters
Apr. 2016	Director, Senior Managing Executive Officer, General Manager of Marketing &Sales Headquarters, in charge of Research & Development Headquarters
Apr. 2018	Director, Senior Managing Executive Officer, General Manager of Overseas
Business Headquarters, and concurrently, General Manager of Group 3 Sales &Marketing Division, and in charge of Business Planning Division
Apr. 2019	Director, Senior Managing Executive Officer, General Manager of Overseas
Business Headquarters, and concurrently General Manager of Group 1 and 3 Sales& Marketing Divisions, and in charge of Business Planning Division
Apr. 2020	Director, Senior Managing Executive Officer, General Manager of Overseas
Business Headquarters, and in charge of Business Planning Division (current)

Audit & Supervisory Board Members
Haruhiko Ishikawa Standing Audit & Supervisory Board Member

Katsuhiko Shinji Standing Audit & Supervisory Board Member

Career Summary and Current Position in the Corporation:
Apr. 1980 Joined Rinnai Corporation
Nov. 2005 General Manager of Administration Division, Administration Headquarters
Apr. 2014	Executive Officer, General Manager of Administration Division, Administration
Headquarter
Jun. 2016 Audit & Supervisory Board member (current)

Career Summary and Current Position in the Corporation:
Apr. 1981 Joined Rinnai Corporation
Dec. 2000 President of Shanghai Rinnai Co. Ltd.
Jun. 2004 Director of Rinnai Corporation; President of Shanghai Rinnai Co. Ltd.
Jun. 2005 Executive Officer of Rinnai Corporation; President of Shanghai Rinnai Co. Ltd.
Apr. 2009	Executive Officer, Deputy General Manager of Overseas Business Headquarters in
Charge of Asia, Rinnai Corporation; President of Shanghai Rinnai Co. Ltd.
Apr. 2011 Executive Officer of Rinnai Corporation; President of Shanghai Rinnai Co. Ltd.
Apr. 2019 Assistant to General Manager of Overseas Business Headquarters, Rinnai Corporation
Jun. 2019 Audit & Supervisory Board member (current)

Outside Independent Audit & Supervisory Board

Masaaki Matsuoka Member

Ippei Watanabe

Career Summary and Current Position in the Corporation:
Sep. 1976 Registration of a certified public accountant
Jul. 1988 Partner at Deloitte Tohmatsu LLC (Now, Deloitte Touche Tohmatsu LLC)
Jun. 2014 Retired from Deloitte Touche Tohmatsu LLC
Jul. 2014 Established Masaaki Matsuoka CPA office (current)
Jun. 2016 Audit & Supervisory Board Member (current)

Career Summary and Current Position in the Corporation:
Apr. 1978	Registration of attorneys
Joined Saji & Ohta Law firm
Jun. 1991	Established Ohta & Watanabe Law firm (currently, TRUTH & TRUST Law Office)(current)
Jun. 2016 Audit & Supervisory Board Member (current)

Current Representation in other companies
Audit & Supervisory Board Member at Kanemi Co., Ltd.
Outside Audit & Supervisory Board Member at Mitachi Co., Ltd.

Current Representation in other companies
Outside director at Howa Machinery, Ltd. (Audit and supervisory committee member)

Outside Independent Audit & Supervisory Board Member

Executive Officers

Kinji Mori

Hideyuki Shiraki(excluding concurrent directors)

Managing Executive Officer
General Manager of Quality Assurance
Headquarters, and General Manager ofEnvironment Division

Managing Executive Officer
General Manager of Marketing & Sales
Headquarters

Chuji Nakashima

Hirohisa Ooi

Terumasa Kaneko

Executive Officer
General Manager of Research & Development
Headquarters, and General Manager ofTechnology Administration Division

Executive Officer
General Manager of Production Headquarters

Executive Officer
General Manager of Customer Service
Supervisory Division, Marketing & Sales
Headquarters

Kazuhiko Matsumoto

Masanori Shimizu

Kazuto Inoue

Executive Officer
General Manager of Seto Factory, Production
Headquarters

Executive Officer
General Manager of Technology Development
Division, Research & Development Headquarters

Executive Officer
General Manager of Production Engineering
Division

Kenichi Ebata

Katsunori Tanioka

Takuya Ogawa

Executive Officer
General Manager of General Affairs Division

Executive Officer
General Manager of Chubu Branch, Marketing &Sales Headquarters

Executive Officer
Deputy General Manager of Corporate
Planning Headquarters

Hiroyuki Hoyano

Fuminobu Ishikawa

Kenji Endo

Executive Officer
General Manager of Kanto Branch, Marketing& Sales Headquarters, and General Manager
of Living Room Sales Office

Executive Officer
President of GASTAR Co., Ltd.

Executive Officer
President of RB Controls Co., Ltd. andPresident of Noto Tech Co., Ltd.

Rinnai Report 202070

Compliance
Rinnai thoroughly instills compliance in all its executives and employees to ensure it is a sound corporate group that istrusted by society. We are enhancing our corporate culture of compliance and creating an environment in which all
executives and employees can fulfill their social responsibilities and approach their work in a forward-looking manner.

Rinnai Group Code of Ethics
The Rinnai Group has compiled behavioral standards that all executives and employees must obey in the “Code of
Ethics,” a small booklet that includes the “Rinnai Code of Conduct” as a guideline for specific daily activities.
In addition, an English-language version of the “Code of Ethics” is issued to Group companies, and in countries
where the official language is not English, the manual is translated into the local language of that country.
Each year, Rinnai conducts Code of Conduct awareness activities for all employees.
Furthermore, in Japan we have created the “Rinnai Code of Conduct Guidebook” as a tool to deepen understandingof the content in the “Rinnai Code of Conduct” and we also implement tests using e-learning to confirm the level ofunderstanding.

Facilitation of Internal Reporting System
If, in the course of business activities, an employee at a domestic company under the Groupumbrella suspects possible breach of laws or the internal rules or unfair practices, and it isdifficult to approach a superior or the person responsible for the division with suchsuspicions, the employee may report the perceived infraction to the Corporate Ethics
Helpline.
Established in November 2005, the Helpline accepts inquiries from within and outside
the Company. In this system, we stipulated that the person who reported the incident will
not receive any unfair treatment by the fact that he or she consulted the matter, and we also
pay full attention to the protection of privacy of the person who made the report.
In fiscal 2020, the helpline received six reports and requests for advice. Appropriate
measures have been taken, including investigation and confirmation of the facts in thesecases of alleged misconduct.

A legal violation or someother issue occurs during
operations
Breaches of laws, regulations,internal rules, and ethics
Confirmation of illegal activities
Found it difficult
to consult witha supervisor

Consult with a supervisor or
the person responsible forthe division
SolvedNot solved

Corporate Ethics Helpline

Disciplinary Actions

Rinnai Group Code of Ethics(Japanese and English versions)

Scenes where the Rinnai Group Code of Ethics is being entrenched (Left: Brazil, Right: Malaysia)

In order to maintain an appropriate work environment, disciplinary action is imposed on those who violate work rules andinternal regulations.
In particular, in cases of severe disciplinary action, the Disciplinary Committee will meet to take strict measures.
Furthermore, for the purpose of preventing recurrence, violations and results of disciplinary actions are disclosed every
year in the Company newsletter, except for information that identifies individuals.

Compliance Education Activities
Compliance Violations
Rinnai’s Legal Division conducts legal education every year with regard to laws
closely related to operations conducted by business divisions. Rinnai also conducts
compliance education every year during employee training for new recruits and byrank, with 251 employees attending in fiscal 2020.
In addition, we share a variety of information with domestic Group employees
via our in-house intranet, where we post data such as information regarding legal
reforms, legal commentary concerning our operations, and examples of violations
that occurred at other companies.

In fiscal 2020, there were no serious compliance violations.

Protecting Personal Information
New recruit training

Confirmation and Modification of Compliance Activities
Every year, we conduct employee questionnaires to ascertain how deeply ingrained elements of our Corporate
Philosophy have become. In fiscal 2020, these showed that 99.7% of respondents were familiar with the Company Motto,
97.5% of respondents recognized Rinnai Brand Promise, and 94.8% understood our Corporate Mission.
We will continue to actively promote compliance activities to maintain these high levels.

71

Rinnai has established internal rules based on the Act on the Protection of Personal Information. We also established a
Privacy Policy as a guideline for handling personal information that is published on our website (https://www.rinnai.co.jp/
en/policy/privacy/). Through these efforts, we strive to properly manage, use and protect personal information.
Specifically, a Personal Information Protection Manager is appointed at the Head Office to maintain and teachinternal rules. Personal Information Protection Committee members are assigned in each workplace and domestic Group
company to provide guidance on methods and procedures to the person in charge of handling personal information.
In addition, the Personal Information Protection Committee member conducts internal audits once each year under
the direction of the Personal Information Protection Manager regarding the management status of personal information ineach workplace.
In fiscal 2020, there were no personal information leakage incidents.

Rinnai Report 2020

72

Risk Management
Executive Structure
We have introduced an executive officer system in order to create a flexible management structure capable ofresponding swiftly to changes in the business environment. Some directors, from the President down, serve concurrently
as executive officers, and their role is to convey the details of decisions made by the Board of Directors to the managersof the divisions responsible so that they can be implemented. Quarterly Companywide management meetings andindividual management meetings are also held to confirm how business is progressing and to share information on thechallenges faced.

Basic Principles of the Internal Control System
Seeking to reinforce our management system and fulfill our social responsibilities, we established an internal control
system with the following aims:(1 ) To enhance the stability and efficiency of business operations;(2) To ensure the reliability of financial reports;(3) To comply with laws and regulations affecting business operations and internal regulations;(4) To maintain assets

Information Disclosure
In addition to the formulation of internal rules for the timely and appropriate disclosure of important information
concerning the Group, Rinnai created a disclosure policy that is published on our corporate website as a guideline for
information disclosure.

73

Risk Management Policy
As society becomes increasingly complex, companies face a variety of risks. Against this backdrop, the Rinnai Group is
promoting its business on a global scale and is implementing risk management to ensure it remains trusted by its
customers and society and conducts business activities in a stable fashion.

Promotion of Business Continuity
When companies do not have sufficient measures for natural disasters such as earthquakes and storms and theprevalence and spread of infectious diseases, business operations may be suspended for a long time, resulting insignificant losses and having a serious impact on stakeholders. As a company which produces thermal energy appliances
to support people’s lifestyles, we believe it is our responsibility to maintain the stable supply of our products. We position
cases where there is a risk of interruption in the manufacture or supply of products vital to customers as important issues
for business continuity management and are formulating and reviewing business continuing plans (BCPs).

Promotion Structure
Rinnai’s Risk Management Committee is comprised mainly of executive
officers and divisional heads with the President serving as Chairman. The
Committee meets regularly to identify key risks having the potential toimpact the Company as an ongoing concern, its credibility, businessactivities, and assets. The Committee also determines which businessdivisions have a primary responsibility for each type of risk. It also develops
mechanisms to prevent risks from materializing, rapidly resolves crises,
minimizes any damage that may occur as a result, and preventsrecurrences. The Committee works with all divisions and Group companies
to mitigate risks and enhance risk response capabilities.

Risk ofnon-compliance ormanagement inviolation of applicablelaws

Risk of fire, explosion
accidents, andnatural disasters

Important Identified
Risks (Partial)

Risk of suspension ordelays affecting raw
material procurement
activities

Risks related tothe environment

Risks related tooverseassubsidiaries
Risk of damage to
mission-critical systems

Risks related to
information leaks

Rinnai Report 2020

74

Rinnai’s Response to the Spread of COVID-19
Structure

DemandIn response to the spread of COVID-19, Rinnai established a Countermeasures Headquarters centered on the existingrisk management system with the President of the Countermeasures Headquarters and the General Affairs Manager incharge of crisis management. Based on conditions in each country, this system enables Rinnai to promptly disseminate
information on response procedures as action guidelines for employees.
To prevent the spread of infections, we continue to expand work from home and staggered working hour systems
while making daily improvements to new work styles, including a new meeting structure using an online videoconferencing system and the creation of a working structure that avoids crowds.

When the state of emergency was announced in each country, consumers voluntarily curtailed purchases and sales
temporarily trended downward, but as restrictions eased, the demand for water heaters, which are a daily necessity,
as well as cookware and heaters rose due to increased time spent in the house due to “stay home” guidance.
In Japan specifically, the easy housework strategy already being implemented led to strong sales of time-saving
products such as the DELICIA built-in gas hob (stovetop), dishwashers and gas clothes dryer Kanta-Kun. We are also
proactively making proposals, including the launch of the microbubble bath unit, which enables customers to enjoy
microbubbles in their bath so that they can spend fulfilling time at home.

Supply and Manufacturing
Regarding component supplies and production, although there were some problems such as production plant operationsuspensions and difficulty in supplying parts from Asian countries due to lockdowns in the initial stage of COVID-19, theRinnai Group has long engaged in local production as a basic policy, thus there have been no major delays during the
pandemic up to now. We maintain a thorough risk management system on a daily basis and have prepared measures
such as the establishment of multiple supply routes and production plants for emergency situations.
Regarding production, although plants operated or stopped in response to the declaration of conditions in eachcountry, the governments of each country strongly regard water heaters and heaters as products necessary for daily life,
thus in many cases plants could continue to operate.

App that links to DELICIA+R RECIPE

Dishwasher

Gas clothes dryer Kanta-Kun

Social Contributions
Management
Our announcement of the year-end financial results for fiscal 2020 on May
2020 was conducted during a state of emergency, so the financial results
briefing session was held using an online conferencing system. Although
this was the first time Rinnai had conducted a full-scale dialogue with
reporters and other external stakeholders, the briefing session was able tobe conducted without delay. In addition, we used streaming video to
conduct our usual briefing sessions for investors, and these also wentsmoothly.
With regard to our full-year performance announcement, as it was
Financial results briefing session held using an online
conferencing system
difficult to predict the spread of COVID-19, we temporarily postponed theplan for fiscal 2021. However, in our first quarter financial results announcement on August 2020, we announced revisions
to the planned targets for fiscal 2021.

75

Rinnai supports and participates in the Declaration of Support for COVID-19 Countermeasures Related to Intellectual
Property in support of COVID-19 countermeasures.
This declaration pertains to acts with the sole purpose ofending COVID-19 and states that Rinnai will not assert intellectual
property rights (patents, utility models, designs or copyrights) nor
seek compensation with regard to any activities whose purpose
is stopping the spread of COVID-19.

Rinnai Report 202076

Information Security
Information Security Policy

Implementation of Information Security Measures

We have created the Rinnai Group Information Security Policy, which establishes policies regarding the developmentof internal rules, promotion systems, the implementation of information security measures, enlightenment, education,
training and continuous improvements, and we are unifying the direction of information security measures throughout
the Group.
Amid necessary preparations for cyberattacks, we are working daily to further strengthen information security
measures throughout the entire Group in accordance with these policies.

A variety of measures are implemented to prevent information leaks. These include protection against hacking fromoutside sources, anti-virus measures, encryption of data before information assets are removed from company premises,
control of devices such as USB memory sticks, and measures against spam. Access is rigorously controlled at all plants
and offices, and entry and access to sensitive areas is also controlled.

Information Security System Maintenance
Chief Information
Security Officer

Head Office Information
Security Manager

IT Security Office

Head Office Information
Security Manager

In order to implement Companywide information security measures, Rinnai has
appointed a Chief Information Security Officer (CISO) who oversees information
security measures, and we have also established the IT Security Office to promote
information security measures among a variety of other initiatives.
In addition, we have appointed Information Security Managers at each businesssite. The IT Security Office and the Information Security Managers work closely
together to create a system that enables smooth progress toward information security
countermeasures.
Further, we regularly hold Information Security Measures meetings consisting of
employees involved in information security measures, including the Chief Information
Security Officer, and we strive to enhance the level of information security measures byconducting discussions and information sharing as well as conducting education andtraining on information security measures.

Information Security Education and Training Activities
The Rinnai Group conducts information security education every year toensure that all employees are fully aware of the importance of information
security measures and properly handle information assets used in businessactivities.
In fiscal 2020, we focused on information security-related themes thatare prevalent throughout the world, such as business email scams, phishingand social media precautions. The seminar was conducted by the IT
Security Office and held at each business site with a large number ofInformation security education implemented at sales offices
employees in attendance. Going forward, we will also utilize e-learning tofurther expand the number of seminar participants and enhance seminar content. In addition, we regularly conduct
cyberattack email training in an effort to hone employee experience so that we can respond promptly when problems
related to information security occur.

Information Security Countermeasures Status Verification

Information Security System Diagram

The Rinnai Group conducts inspections of and exchanges opinions on the status of information security measures atdomestic and overseas Group companies. We conduct verifications from multiple perspectives and conduct diagnoses
of information security countermeasure levels at each Group company.
We also set goals for information security measures, and in consideration of these goals and the level diagnoses
results, we are promoting an enhanced level of information security countermeasures throughout the entire Rinnai Group.

77

Rinnai Report 202078

Communication with Employees

Communication with Employees

Communication with Employees

Selected as a “2020 Health & Productivity Stock”

Enhancement of Health Promotion Activities
In 2013, Rinnai established the
Health Support Office where fulltime public health nurses provide
individual health guidance andconsultations as well as information
related to personal health, such ascountermeasures for preventing
lifestyle-related diseases, andconduct health promotion seminars
to support mental and physicalhealth.
In fiscal 2020, frequentinterviews with targeted employees

Rinnai was selected as a “2020 Health & Productivity Stock” under a program sponsored by the Ministry of Economy,
Trade and Industry (METI) and the Tokyo Stock Exchange (TSE). “Health & Productivity Stock” selections have been
made since 2015 from among outstanding companies listed on the TSE that are engaging in a health and productivity
management program. In addition, Rinnai was also selected as an “Outstanding Health and Productivity Management
Organization (large enterprise category) 2020 (White 500)” (sponsored by METI). Not limited to listed companies, thiscertification also recognizes organizations that implement excellent health and productivity management practices.

Rinnai’s Initiatives
Rinnai’s policies for promoting and maintaining employee health are stipulated in the
Rinnai Group Code of Ethics and the business plan for the Human Resources Division.
The Human Resources Division has established dedicated departments (a health andwelfare team and a health support office) as part of Rinnai’s three-pronged approach tosupporting employee health involving the health insurance union, the employee union,
and the Company.
Mental Health Measures
We conduct mental health seminars according to occupational level, including self-care
employees for all employees and line care seminars for managers and supervisors.
In addition, we aim to have over 95% of employees undergo stress checks.
Measures to Prevent Lifestyle-related Diseases
We provide guidance to prevent the onset and progression of diabetes andhypertension to those who are insured but not currently receiving treatment. We also
hold such events as sports festivals and walking festivals.
Measures Against Metabolic Syndrome
We aim for a 5 percentage-point year on year increase in those who are no longer
diagnosed with metabolic syndrome and are implementing specific health guidance for
employees aged 35 and older.

79*U nder the Health & Productivity Stock Selection
program, METI and the TSE have jointly been
selecting companies that strategically carry out
efforts regarding their employees’ health from amanagement perspective as “Health & Productivity
Stocks”. The program selects outstanding listedcompanies engaging in a health and productivity
management program and introduces them as
attractive companies for investors who prioritize theimprovement of corporate value from a long-term
perspective. Through this effort, the aim is to raisesocial recognition of enterprises engaging in healthand productivity management and to thereby
encourage enterprises to further engage in healthand productivity management.

led to the prevention leave taken due
Health consultation by a full-time public health nurse
to mental health issues and thestrengthening of support systems enabling the smooth return of employees to the workplace.
In addition, aiming for a work environment that does not cause mental disorders, we have expanded the scope ofmental health seminars and hold seminars related to work-style reform regulations and compliance-related issues.
Furthermore, we have strengthened support for mentally ill people as well as people with physical illnesses such as
cancer and other incurable diseases. As a result, the number of people with physical illness returning to work has
quadrupled from the previous year.
In addition to the aforementioned efforts, in order to encourage employee health promotion activities, we haveestablished a Health Management Promotion System and in the Rinnai Code of Conduct ethics statement, we declare
our intention to “create work environments that are safe as well as physically and mentally healthy and comfortable.”
Based on these principles, we are engaged in three-fold activities in collaboration with employee unions and healthinsurance unions. As a concrete example, we co-sponsor events such as diabetes seminars and sports festivals.
In addition, we collaborate with a dietitian in our employee cafeteria to provide smart meals certified by the Healthy Dietand Eating Environments Consortium through the provision of health-conscious menus. We also conduct health campaigns
to check blood vessel age, bone density, blood iron levels and skin age with the aim of raising health awareness.
Additionally, we hold walking seminars to promote health and raise awareness regarding weight loss and physicalfitness.
Health Management Promotion System
Rinnai received Sports Yell Company
Person responsible for health management
certification in recognition of efforts such
(President and CEO)as conducting radio calisthenics at thePromotion and evaluationof health businessSports communication
Data-based insurance
Cooperation
Cooperation
event
business
start of the work day, holding various
Employee union
Personnel affairs
Health insurance
sports events such as the aforementioned
divisionassociation
Sports Festivals, supporting various sports
Health and safety committee(Each office)club activities and supporting the use of
sports facilities.
Employees

Rinnai Report 202080

Communication with Employees

Communication with Employees

Career Development Review and Support

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. We provide our employees withnumerous opportunities to grow as an individual, such as rank-specific training programs, specialization courses,
OJT training, and a rotation training program, which covers workplaces at home and abroad.

OJT Personnel Training

Support for Self-directed Development

We position human resources as our most important management resource, and offer personnel training to assist
employees to fully demonstrate their capabilities.
Our main training is OJT, wherein a supervisor guides his or 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
them according 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.

Major Rank-specific Training Programs
Training

81

Subject

Content

New employee training
program

New employees

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

New employee follow-up
training

Generalists (Clerical and sales
employees) in their 1st year, Generalists(technical employees) in their 2nd year,
clerical employees (technical employees)
in their 1st year

Training for increasing motivation to work and raising professionalawareness(Reconsolidation of what was learned in the new employee training
program; employees who joined the Company in the same year gather
and share information about their current status)

S4 level-qualified employee
training

S4 level-qualified employees

Reconsolidation of fundamentals (corporate ethics and management
policy), Recognition of his or her characteristics (to improve thestrength) and the reinforcement of awareness of management(creation of management plans)M6 level-qualified employees

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

M6 level-qualified employee
training

For each training program to function effectively, it is essential to match the capability required by the organization and thegoals 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 and responsibilities. Employees also have a one-onone interview with their supervisor, during which they receive the results of their performance evaluation and are informedof the Company’s future expectations of them. 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 the results of the evaluation
through one-on-one interviews or performance appraisal feedback meetings.

M6 level-qualified employee
follow-up training

M6 level-qualified employees

Reaffirming shared goals
Reconsolidation of values concerning managers’ actions, Reviewing
the efficiency of the entire workplace

Reviewer training follow-up
training

Employees whose duties require them tointerview subordinates and review theirperformance

Review of personnel systems• Understanding of objectives and methods of performance reviews• Improvement of interview skills through interview practiceTo support each employee to acquire higher specialist knowledge, skills, and culture and support their growth as anindividual, we actively provide programs including foreign language education, correspondence courses, external open
seminars, technical proficiency examinations, license acquisition courses, and communication with people in different
companies/industries. We provide rank-specific training programs to create opportunities to be aware of aspects forstrengthening one’s sense of humanity.
In addition, for young employees who have a strong desire to work overseas, we arrange and operate a short-term
overseas working and training program that is available for them via application. This is to develop human resources thatcan globally demonstrate their capabilities working at our overseas locations. Currently, a total of six young engineers areworking 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 candemonstrate their abilities at a global level.

Succession of Monozukuri, the Spirit of Manufacturing
Training at the Production Technology Center
The Production Technology Center established in March 2010 is a place to pursue leading-edge monozukuri, with and anemphasis 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 talentdeveloping support tool. Utilizing this tool, our staff who are 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.

Worksite Training“Manufacturing succession centers” are established at each worksite to preserve andpass on tangible assets including accumulated process technologies and newtechnologies that perpetuate the “worksite intuition” of experienced employees.
These are used as places to teach new employees manufacturing basics as well
as a place to share and pass on information and educate personnel with respect tomanufacturing “efficiency improvements and management strengthening.”

Rinnai Report 202082

Communication with Employees

Development of Global Human Resources
In order to develop human resources who can play an active role across national borders and improve the capabilities of
employees around the world, the Group has developed a business practices program that assigns mutual training
programs to management divisions, product development divisions, and manufacturing divisions.
With regard to human resources in Japan, we give the opportunities for secondment to overseas group companies
from their 20s. The program is based on gaining actual experience through an overseas posting and aims to develop
participants’ adaptability to different cultures and international business sense.

VOICE
Temporary Transfer from Research & Development Headquarters
to Overseas Group Company

VOICE

After engaging in the development of heat source equipment and heaters for hot water heating
systems in the Research & Development Headquarters for 22 years, I have been stationed atComing to Japan from Indonesia for Training

Rinnai Australia since April 2019.
When adjusting the specifications of a water heaters designed in Japan, I experienced

I joined Rinnai Indonesia in 1994 and have been involved in machining dyes for parts withmachining devices, assembly, and design. I am currently working on dye design, so I am able toapply my experience on the front lines in parts machining and assembly. This experience has
motivated me to machine, assemble, and confirm the parts I have designed in the downtime

the importance of having direct discussions with local staff through repeated installation
Rinnai Australia Pty., Ltd.

Kokichi Sato (Left)I have between design jobs.

Mulyadimarket from the settings and sites of water heaters and air conditioners utilizing locallydesigned heat pump technology.
Recently, there has been a movement to link large-scale forest fires to environmental

My first experience with training at Rinnai was in 2007 when I was doing dye part
Rinnai Indonesia

verifications using a 3D CAD model. In addition, I was able to learn the characteristics of the

problems, and I feel that environmentally friendly equipment is becoming more important.

machining. I spent a year experiencing precision parts machining and assembly. At the time, I

Rinnai plays a leading role in the Gas Appliances Manufacturers Association of Australia,

did not understand Japanese and must have been a bother to the Rinnai staff looking after me.

and through our participation in forums on the utilization of renewable energy, we provide

My second Rinnai training was in 2019. I learned design for an important component to betrends from gas supply companies to the construction industry to Japan, as well as strive toused in a new tabletop stove being planned for Rinnai Indonesia. It was a dye for automatedshare information from our research with local certification bodies and universities.

press equipment (line spacer) that was already in operation at Rinnai Indonesia, and I learned a

In addition, while interacting with the Consulate General of Japan in Melbourne,

lot by overcoming many design criteria that I had not experienced before.

I recognized the importance of the role of local employment and received advice on the

I would like to work to build high-quality and cost-competitive dyes by adopting Rinnai’s

utilization of human resources in Japan and Australia.

standardized dye design, parts machining, and assembly in Rinnai Indonesia.

From now on, I would like to deepen cooperation between the development departmentsof overseas corporations and strive to lead to product development that can contribute tosociety globally.

Secondment to Overseas Group Company
Experienced in a Variety of Operations, Stationed Overseas as a
Factory General Manager

I was in charge of Latin American sales for one and a half years in the Overseas Business
Headquarters. Since June 2019, I have been posted in the United States to be closer to ourcustomers and to work with them without a major time difference. I conduct sales in countries

Rinnai America

Akinori Ando
(Third from left)

other than Brazil, which is covered by Rinnai Brazil. My sales coverage is a market

I engaged in mold manufacturing work for eight years in the Production Engineering Division,encompassing 32 Latin American countries with a population of 400 million, including Chile,

production management work for five years at the Seto Factory, and manufacturing planning

Mexico, Argentina, Peru, Bolivia, and Colombia. Our direct business partners are thework for eight years at the Production Headquarters. Since 2019, I have been stationed at

distributors who will import and sell our products. I try my best to expand sales by getting as

Rinnai Viet Nam as a factory general manager. In this role, I engage in a wide range of tasks,

many people as possible to understand the appeal of Rinnai’s products and to introduce

from dealing with problems that occur every day, preparing for the mass production of new

products that fit each market. In addition, I am actively looking to create new business partners
in countries where we do not have distributors yet.
I basically travel alone on business trips. Admittedly, there are some challenges as some

Atsushi Inoue (Middle)

products and improving the quality and productivity of the factory.
While I make use of what I have learned in Japan and the relationships I have built, incountries with different cultures and customs, it often does not work in the same way as incountries are different from Japan in areas like public, but I find my work truly rewarding as I canJapan, and in particular, the vague expressions peculiar to Japanese people do not work

spread Rinnai’s products and brand while interacting with the customs and cultures of various

overseas. Every day I learn something and feel great purpose as I engage in my work.

countries. It’s always an effort to communicate in Spanish or English. Yet language is only a tool;83

Rinnai Viet Nam Co., Ltd.

Viet Nam is a young country with an average age of 30 years old, a country where you canwhat is important is how you plan your business and the value-added that your services

feel the economic growth. Rinnai Viet Nam is a 20-year-old company and is also in the processprovide. I am working daily to quickly build Rinnai into the number one brand in Latin America.

of growth, and I would like to contribute to the further development of Rinnai.

Rinnai Report 202084

Communication with Employees

Communication with Employees

Work-Life Balance
Support for Work-Life Balance
For all Rinnai employees to perform well, attaining a sense of accomplishment and fulfillment balancing work andpersonal life for each lifestyle, we continue to enhance our personnel system to support all employees of any gender andnationality throughout their lives.

Formulation and Implementation of the General Employers Action Plan
Rinnai formulated the General Employers Action Plan (Fifth Period: Fiscal 2020– Fiscal 2022) basedon the Act on Advancement of Measures to Support Raising Next-Generation Children.

Program and MeasureChildcare leave

Content
Employees living with and raising a child or children less than one year of age may take aleave of absence from work until the child or children reach one year or one year and six
months of age. (The leave of absence may be extended until the child or children reaches
two years of age, dependent upon the conditions of the application for leave.)

Fifth Period General Employers Action Plan

1. Plan period
April 1, 2019 to March 31, 2022

Employees who live with and raise children until March 31 of the third year of elementary
school can request to have their prescribed working hours changed within a range of not lessthan six hours a day.

2. Details

Sick or injured childcare leave program

Employees may take a maximum of 10 days (20 days for employees with two or more
applicable children) of leave per year in half-day units to care for sick or injured children.

To improve workplace environment and change awarenessfor realization of balance between childcare and work

Extended family care leave

Employees may take a maximum of 10 days (20 days for employees with two or more
applicable family members) of leave per year in half-day units to care for a family member inneed of long-term care.

<Measures>

Family care shortened work hours

Any employee who is responsible for a family member that requires full-time or nursing care
may shorten his or her daily working hours, provided that a minimum of 6 hours are worked
each day. This provision is possible for more than once during three years from the starts ofuse of this program per such family member.

Childcare shortened work hours

Objective 1:• Expand more flexible work styles(Extended period of shortened working hours system, etc.)85

Family care leave

An employee can take up to 10 days leave per year (20 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.

Come Back programThis program offers an employment opportunity to our former employees who had to leave
the Company for unavoidable reasons such as marriage, childcare and family care, or on his
or her discretion.

Measure 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.

• Improve management awareness(Develop training programs and consistently conduct interviews before maternity leave, duringchildcare leave and after returning to work)
Objective 2:

To promote initiatives expanding work-life balance<Measures>• Promote work load reduction activities(establish satellite offices, review internal rules, etc.)• Provide business management support for managers(further improvement of attendance system)• Promote the acquisition of paid leave

Rinnai Report 202086Communication with Employees

Communication with Employees

Industrial Relations and Human Rights
Working to Enrich the Lives of Our Employees’ Families

Establishment of Good Labor Relations
Employees of the Company are members of the Rinnai Employees’ Association, which functions as the organization torepresent the entirety of the Company’s employees. Based on mutual understanding and trust, the Company and the
Association establish healthy and sound labor relations, openly exchanging opinions on management issues, labor
conditions, workplace environments, and compensation and discussing improvement plans.
Moreover, the Company makes effort to provide a safe working environment without any concern to the employees
of our business partners, etc., in addition to our employees. We also actively arrange and offer welfare programs andvarious events and programs for our employees and their families.

Respect for Human Rights and Individuality
The Rinnai 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 ideas of the United Nations
framework and ISO 26000 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.
Rinnai aims to create workplace environments and climates that allow its employees to feel glad to be working for theCompany. We collect opinions regarding the Company from each workplace and hold regular joint labor management
conferences along with employee unions. The goal of these conferences is to make improvements to the Rinnai Group.
We move forward with improvements by sharing issues unique to each business location and conducting systemrevisions. The Company has conducted activities aimed at promoting the use of paid leave, established a new regional
allowance system, and held nursing care seminars. Rinnai also provides financial support for health enhancement events
held by employee unions, such as sport or bowling competitions and walking festivals. Finally, we collaborate with
employee unions to provide workplace tours to employees’ families at our development locations and factories. Throughthese tours, we educate employees’ families about what we and their employee family members do.

Major Programs in Rinnai Employees’ Association
Item

87

Overview

Nationwide eventsin 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 “Education for the soul” that support employees to develop attractive
personalities as members of society

Measure to Prevent Child and Forced Labor
As a measure to prevent child and forced labor, the Rinnai Group “Code of Ethics, Rinnai Code of Conduct, Article 11 The
respect for human rights and each other’s personality (4)” stipulates that “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.” The entire Group abides by and acts on this rule.

Measures to Prevent Harassment
To maintain a working environment that our employees find comfortable, we take measures to prevent any infringementof human rights, including sexual harassment and power harassment. With regard to sexual harassment and power
harassment, we produced a checklist of detailed examples of harassment that is posted on the Companywide intranet
for self-assessment.
Furthermore, we also provide newly assigned department managers with harassment education to reinforce its
prevention.
We also revised our in-house rule to prevent any harassment related to pregnancy, childbirth, child care leave or
family care leave. We clearly determined the detailed act of prohibiting harassment and disciplinary action based on therules of employment if an employee violates any of these.

Rinnai Report 202088Communication with Employees

Communication with Employees
Formulation and Implementation of the General Employers Action Plan

Fair and Diversified Employment

Rinnai formulated the General Employers Action Plan (Third Period: Fiscal 2021– Fiscal 2022) basedon the Act on Promotion of Women’s Participation and Advancement in the Workplace.

View toward Employment
Third Period General Employers Action Plan

We respect the diversity of individuals and provide employees with various job opportunities and a working environment
where they can demonstrate their various capabilities. The Rinnai Group Code of Ethics stipulates that “Anydiscriminatory act toward an individual based on gender, age, nationality or physical characteristics, etc. is prohibited.”
Based on this, we maintain fair and equitable 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 and knowledge ofindividuals who showed they can make a contribution to our success. We hire approximately 10 skilled mid-career
employees every year.

Increase of Female Employment and Support for Their Active Role

To improve the employment environment so that women can play an activerole, Rinnai has formulated the following action plan.
1. Plan period
April 1, 2020 to March 31, 2022

2. Company issues(1) Although the proportion of female graduates hired has increased, there is a difference in the number of years
employed between men and women. Systems and environments must be developed so that employees stay
employed longer.
(2) The percentage of women in managerial positions is low. It is necessary to increase the number of women inpositions one level below section chief and increase the number of women promoted to managerial positions.

3. Goals, initiative details and implementation timeframes.
Ideas and comments from women are absolutely crucial to our products, particularly as they use so many of our 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 planning and promotion departments, fixedcustomer sales departments, and production departments. At Hot.Lab, our interactive facility, female employees called
Life Creators demonstrate and promote our products to customers. Life Creators across the country gather every year to
exchange their opinions. They share their opinions on product functions, designs, and methods of demonstration tocontribute to the development of new products and the improvement of product promotion.
In addition, the fixed customer sales department proactively engaged in sales promotions from a female perspective
targeting customers such as retail stores and house makers.

VOICE
Aiming for an Environment Where Employees Can Work
Comfortably

Goal 1: R educe the difference in average years of service between men and women from 5.7 years to

4.8 years.
Initiative details: R educe the number of retirees due to childcare, family care or other factors through systemrevisions.
New: Support for employees working shortened hours.
New: Expansion of telecommuting system.
Goal 2: Increase the percentage of women in general positions (non-managerial positions) from 5.7%

to 6.5%.
Initiative details: Reduce the number of retirees due to workplace culture, childcare and family care.
Ongoing: Support for returning to work after maternity leave (usage and revision of interview check sheet used
before and after returning).
Ongoing: Promotion of female employee roundtable discussions at each business site (understanding requests
for work details and environment and network formation support).
New: Appeal to female general employees using in-house newsletters and other means of communication.
Goal 3: I ncrease the percentage of women at the section chief level from 4.5% to 6.0%.
Initiative details: C hange awareness of women’s advancement through education by training and other methods.
Ongoing: Conducting training for female employees (unions).
Ongoing: Implementing a program fostering an understanding diversity within managerial training.
New: Implemented a program to motivate chiefs to seek promotion to section chiefs.

In my department, we use information technology to support the creation offlexible working styles and comfortable environments in the workplace. Amongthese, I am developing and introducing systems focusing on business
improvement in departments in the Head Office.
Until recently, I was working from home due to the spread of COVID-19. Byutilizing groupware and e-mail, I was able to strike a better balance between
housework and childcare at home, as well as realize work improvements that can only
be achieved by working from home, which makes every day fulfilling.
Seizing upon this opportunity, we will work hard every day to create anenvironment where everyone can work comfortably even after the pandemic is over.

89

Information System Division

Disclosure of Information about Promotion of Women’s Participation and Advancement

Eriko Fukaya(1) Percentage of women at the section chief level 4.5%
(2) Difference in average years of service between men and women

5.7 years

Rinnai Report 202090

Communication with Employees

Communication with Employees

Occupational Health and Safety
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 many employees working under this program. We offer one-year contracts until the ageof 65, with a choice of three options, enabling employees to work full time, alternate days, or reduced hours. We also havea 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 purposeand motivation in life as a leader/mentor and maintains and improves the corporate culture and dynamics within theworkplace.

Promoting the Employment of People with Disabilities
Rinnai is collaborating with the Public Employment Security Office and schools for handicapped children tosystematically promote the employment of people with disabilities. The Company independently holds job fairs forpeople with disabilities and continuously conducts campus recruiting at schools for handicapped children. Employment
focused on people with disabilities concentrated in specific locations was started in April 2018 and has been successful.
These employees are able to engage in a wide range of operations, from advanced computer processing work tosimple tasks and from cleaning work to weeding activities. Employees are provided with an individualized businessprogram that best suits their type and level of disability with the aim of creating a workplace that is rewarding, bright,
and enjoyable.

Basic Policy on Safety andHygieneAn essential requirement in business isthe 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 thesanitary conditions and safety of theworkplace. This corporate mantra
extends to our customers, to whom westrive to provide “safety and peace ofmind.”

Fiscal 2021 Basic Policy on Safety and Hygiene

1. Create safe and reliable work environment
2. Maintain and improve work environment
3. Work style reforms and compliance with Article 36
Agreement
4. Promote measures to support for health improvement
5. Promote crisis management
6. Personnel training through safety education andworkshops
7. Promote traffic safety activities

Promoting Safety and Health Activities
Rinnai has established the Rinnai Companywide Safety and Health Committee as a governing body for domestic Group
companies and is working with safety, health, and disaster prevention officers at each business location to promote
occupational safety and health activities.
These activities include informing employees about examples of work-related injuries and corresponding recurrence
prevention measures, establishing safety and health committees that include members from both labor andmanagement levels, creating safety and health patrols, and implementing the Company’s five fundamentals of safety andhealth (regulation, arrangement, cleaning, sanitation, and training). Through these activities, we are working to create
workplace environments that are secure, safe, and comfortable.

Promotion of Traffic Safety

Computer operations

91

Weeding activities

We carry out various educational activities with the aim of raising employee awareness of traffic safety and contributing
to the local community. As a “Zero Day” activity, employees themselves stand on the streets and call out to passers-by.
We hold lectures by police officers in collaboration with local police stations, and for new employees, we rent out a driving
school and hold practical training and risk prediction courses.
Through the periodic acquisition of driving record certificates, we ascertain the status of employee safe driving
behaviors and provide individual guidance as the situation demands.
We have launched the systematic installation of drive recorders on all Company-owned vehicles in addition to
introducing a safe driving eco-drive promotion system (telematics) to promote employee traffic safety and ecofriendliness from practical as well as theoretical perspectives.
Rinnai Report 202092Communication with Stakeholders

Communication with Shareholders and Investors

Aiming for Longer-Term Business Growth and Stable
Shareholder Returns

IR Activities for Institutional Investors and Analysts
Rinnai proactively explains business results and exchanges
opinions with institutional investors and analysts throughfinancial results briefings (held biannually), small meetings,
individual visits and telephone interviews. We also participate inconferences sponsored by securities companies to expand ourIR activities. Further, we hold factory tours every year as anopportunity to deepen understanding of manufacturing
activities. In addition, opinions received from analysts are shared
twice a year at Board of Director meetings as valuable
information used in our management decisions.
Financial results briefing for institutional investors and analysts

Fiscal 2020 Activities

We disclose information in an appropriate, timely, fair, and impartial manner, and engage in IR activities with an emphasison two-way communication in order to earn the trust of shareholders and investors. In an effort to provide ourshareholders and investors with direct updates on our business activities, and to ensure that information is disclosed

IR interviews conducted a total of 170 times
Individual meetings: 89 times
Small meetings: 12 times
Telephone interviews: 69 times
Factory tours: 4 times (in Japan: 2 times; overseas consolidated
subsidiaries: 2 times)
Fiscal 2020 interim results briefing: 57 attendees
Fiscal 2020 year-end results briefing (livestream): 51 viewers

quickly and fairly, we provide information via channels such as results briefings for analysts and institutional investors(twice a year), biannual shareholder reports, press releases and presentation materials for results briefings on our website,
Factory tour

and our IR calendar. Through various opportunities to meet with them, shareholders and investors are able to understandour business growth strategies from a longer-term perspective and to hold expectations for stable shareholder returns.

Investor Opinions at Fiscal 2020 Year-End
Dividend Increases for 18
Consecutive Fiscal Years
One of our top management priorities is to sustain astable return of profits to shareholders. When deciding
on dividends we consider consolidated performance,
return on equity, financial status, but we haveincreased our annual dividend for 18 consecutive
fiscal years since fiscal 2003. Furthermore, we plan to
pay a commemorative dividend of ¥10 (¥5 in the firsthalf and ¥5 at year-end) in honor of the 100th
anniversary of Rinnai’s founding in September 2020 inaddition to the ordinary dividends for the fiscal year.

93

Dividend per share
(Yen)
100
76

80

82

86

90

94

98

68
56

60

Interim
40
20

20

24

26

Year-end
28

30

36

40

42

60

48

Many inquiries from institutional investors and analysts regarding thefull-year results for fiscal 2020 were related to COVID-19, with a great
deal of interest in the impact on our sales and supply chain.
In addition to main products such as gas water heaters and gas
stoves, through the introduction of our proprietary products such asgas clothes dryers, we facilitate a deeper understanding of Rinnai’s
future growth strategy.

Institutional Investor Question Topics
Shareholder returns
5%
Featured products
6%
Impact of
COVID-19
25%

Profit analysis
7%
Marketconditions
8%

Performance
results
18%

Others13%
Main products
18%0(FY) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Rinnai Report 202094

Communication with Stakeholders

Communication with Customers

Improving Products and Services Based on
Customer Surveys

Taking Advantage of the Internet to Enhance Customer Support
We supply care products and user replaceable parts via our
R.STYLE online shopping site to help our customers get themost out of their purchases for as long as possible. The site
started in October 2006 as an online shopping site for genuine
parts for Rinnai products. The range of offerings is being
constantly expanded in response to direct customer feedback
and now includes cleaning and kitchen supplies that are highly
compatible with our products and original products available
only through R.STYLE.
In March 2020, the number of registered members
exceeded 770,000, providing even more opportunities forcontact with users of our products. To keep in touch with
R.STYLE online shopping site (in Japanese only)
members’ needs, we conduct online questionnaires (annuallymore than 15 times) and use the data obtained to design products that meet these needs and resolve issues that theyraise. We will continue to expand direct contact with customers in our quest to deliver better service.

Developing More Intimate Communication through the Living Information Column

Launched in April 2019, ILO is a series of built-in hobs (stovetops) sold exclusively over the Internet with customized color
combinations featuring 10 top plate colors, three front panel colors, and two stovetop colors.
During the planning for this product, Rinnai surveyed current stovetop users regarding their preferences for colors.
When ask about why color preferences were selected, many respondents noted, “I want to be able to select the colors I
like” and “I want the color to match the atmosphere of my kitchen.” From such customer feedback, we created a stovetop
is not “a stovetop selected from an abundance of choices”, but rather, “a stovetop that offers combinations to realize theideal kitchen space” and implemented product planning and sales from that viewpoint. We also conducted a survey ofcustomers who purchased after ILO was launched.

The Rinnai Group established R.STYLE column (“Rinnai-style
column” site). This site provides pertinent living information with thegoal of achieving ongoing communication with customers who use
Rinnai products.
The site provides wide-ranging content closely related to ourdaily lives, containing diverse information related to cleaning, tidying
up and storage, cooking, and laundry and ironing. It also contains
columns that aim to eliminate concerns regarding housework, andto share specialized expertise and information regarding new
discoveries. We try to make articles as plain and simple as possible
so that readers can easily try out the recommendations of experts.
R.STYLE column (in Japanese only)
The Group will continue to endeavor to operate a column sitethat offers rewarding and satisfying articles which will always bring its readers back for more.

From interactions with customers in the sales process and responses to the survey of customers who purchased
the model, we were able to gather specific information on queries about ILO’s functions and on questions customers had
before purchasing, such as regarding removal of the old stovetop. The questions we received from customers are posted
on our sales site, and we will continue showing ingenuity in valuing our ties with customers after sales so they can makepurchases with peace of mind.

95

Rinnai Report 202096Communication with Stakeholders

Communication with Business Partners

Quality Improvement Activities Undertaken Together with
Business Partners

To grow along with our suppliers, we emphasizetransactions based on a fair and impartial assessment
and selection process and respect for laws andregulations and corporate principles, in accordance with
the Rinnai Group Purchasing Policy.

Rinnai Group Purchasing Policy

We will give equal opportunity to all companies athome and abroad and undertake fair evaluations to
procure excellent parts that meet our requirements.

Rinnai’s Stance on the Relationship with Its Business Partners

Scene from meeting to report on quality improvement

Our suppliers provide us with the raw materials and manyof the components that go into the products we make.
They are business partners indispensable to the creationof products that attract consumers to the Rinnai name. At
Rinnai, we believe that building stable, long-term relationships with our suppliers and growing with them as theygrow with us is vital to the creation of better products.

Provide appropriate
information

Rinnai

Rinnai’s fundamental concept is “Quality is our destiny”
and its business partners also understand theimportance of quality as we work together to improve it ineverything we do. We cannot manufacture high-quality
products without parts of good quality.
Rinnai is not only enhancing the inspection of theparts its purchases, but also focusing on enhancing themonozukuri and quality improvement of its business
partners.
In fiscal 2020 six business partners participated inintensive quality improvement activities. Each company
selected a theme related to an issue they faced andworked to improve it according to an annual plan. We
were able to deepen mutual understanding and enhanceeach other’s capabilities through periodic site visits andmeetings to report on quality improvement.
In addition, we are enhancing quality management
to respond rising market demands for quality. In fiscal
2020, we completely updated our quality assurance
manual for business partners.
Going forward, Rinnai will continue working to build
an environment under which we can grow together withour business partners under a spirit of co-existence andco-prosperity.

Rinnai Group Purchasing Policy

Monozukuri
supportResults
ep
c ti v

u
rod

ra
att
te CooperationaeCr
Improve quality,
reduce costs

cts

Co-existence,
co-prosperity(Win-Win)

Products,
monozukuri proposals

Suppliers

Realization of Fair-and-Square Transactions

Reporting on examples of improvement through site visits

In accordance with the Rinnai Code of Conduct in the Rinnai Group Code of Ethics, our supplier acceptance process isapplied uniformly, whether the company is a long-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 at home 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, well-considered decision.

VOICE
Enhancing Trust Through Better Purchasing
I participated in Rinnai’s quality improvement activities aimed at improving quality. I selected “how toeliminate human errors from preconceptions” as our theme. We approached this from employee
training and built a check structure at equipment changeovers and other transition points. As a result,
we had zero quality issues with parts to be delivered. As a supplier, I believe delivery good products willlead to building trust. From here on, I would like to further raise our awareness of monozukuri and have

Tadashi Mishina
President & Representative Director
TECHNOMISUGI Co., Ltd.

97

this lead to the tirelessly pursuit of better quality.

Communication with Our Business Partners
Through New Year’s meetings, business partner policy briefings andmarket background briefings, Rinnai facilitates an understanding of ourquality concept and monozukuri basics as well as provides otherinformation including Rinnai manufacturing trends. Furthermore,through the interactive information exchange tool “R-LINE” that uses
the Internet environment, we promote smooth and timely information
sharing with a greater number of business partners as we strengthen
our preparedness for risks in our business activities in the event of
a disaster.

Market background briefing

Rinnai Report 202098Communication with Stakeholders

Communication with Local Communities and Society

Activities to Disseminate and Support the Parasport Boccia*

Support for Nakagawa Canal Restoration and Cultural/Artistic Assistance Project
We are donating ¥10 million every year for 10 years (¥100 million in total) to the Nakagawa Canal Restoration and Cultural/
Artistic Assistance Project (known as “Nakagawa Canal ARToC10”) set up in fiscal 2013 to restore the canal andsurrounding area. The aim of the program is to revive the district and make it a cultural and artistic hot spot by turning thecanal into a venue for modern contemporary art.

A scene from a boccia match

Competing against KEI in the finals of the main draw

Group photo with Office de Boccia participants

The Rinnai team participated in the inter-company boccia tournament “Office de Boccia in Nagoya: Winter 2020 Battle”
held on February 7, 2020. This tournament is sponsored by the All Japan Business Committee for the Tokyo 2020
Olympic and Paralympic Games and is held in numerous venues with the aim of allowing participants to experience thedepth and fun of boccia and to spread the appeal of parasports. Eighty-two companies and organizations entered the“Office de Boccia in Nagoya: Winter 2020 Battle” and only the 32 teams that made it through qualifying rounds competedin the main draw.
Rinnai’s team successfully made it through the qualifiers to reach the main draw. It lost its first match in the main draw
but won three in a row after earning a repechage position to reach the finals. The Rinnai team faced off against the twotime champion KEI team, but was unable to overcome them and finished a strong second. Through boccia, we were able
to deepen our understanding of disabilities and parasports. And given Rinnai’s ambition to create healthy andcomfortable lifestyles for all people regardless of disability, we intend to participate in future tournaments.
* Boccia: Boccia is a sport created in Europe designed for people with severe cerebral palsy or similar severe limb dysfunction and is an official Paralympic sport. Players compete bythrowing, rolling, or striking other balls with six red and blue balls toward a target white ball called the jack to see who can place the most balls closest to it.

From July 2–26, 2019, “Nakagawa Canal x Art-Colored Urban Development” was held at the Nagoya Urban Institute.
This exhibition featured a retrospective of representative works over the past six years since the launch of the Nakagawa
Canal Restoration Project (ARToC10), which is supported by Rinnai.
Large works that could not fit inside the venue, as well as dance, music and film pieces that could not be exhibited
were shown using panels, videos and photographs. There was a sense of significance with regard to the 22 works
created over the past 6 years, the breadth of which is demonstrated by the variety of the works created for this project.

VOICE
Seeking to Create Excitement for Parasports Together Through Boccia
I believe the “Office de Boccia in Nagoya: Winter 2020 Battle” held this February created a lot of
excitement and was enjoyable for all participants beyond the bounds of parasports. Our team’s goal
was to win the tournament for a third consecutive year. We met Rinnai in the finals, and I was
anticipating a close match, so we aimed to stick to the fundamentals. As expected, Rinnai’s teamshowed good control and strategy which had us on edge. Yet we were a little better on the strategy side

Keita Kato
President & Representative Director
KEI Co., Ltd.

99

Past art works displayed at the venue

and therefore able to win our third consecutive championship.
As the representative of KEI Co, Ltd. and as a Paralympian, it is my sincere wish to work withcompanies to create excitement for boccia and other parasports even after the Tokyo Paralympics.

Rinnai Corporation, Actual Results in Fiscal 2020

• Support for restoration project on the Nakagawa Canal• Nagoya Philharmonic Orchestra• Nagoya School of Music, The Music Competition ofJapan, Award-winning Celebration Concert• Campus Venture Grand Prix, Chubu Area
• Nagoya Shonen Shojo Hatsumei Club (Invention andInnovation Youth Club)• Youngsters’ Science Festival 2019
• Chinese Spring Festival in Nagoya• Misonoza Kinshu Nagoya Kaomise Kabuki• Sponsorship of the Connecting Traditional Japanese
Culture Project• Gion Kobu Kabukai• Choju-no-Kai (Classical Japanese dance)

Rinnai Report 2020 100

Communication with Stakeholders

CSR Activities Underway Across the World

Stakeholder Engagement

United States

Rinnai places great importance on daily
communication with customers,
employees, shareholders, investors,
business partners, local communities,
and the general public in an effort tofurther evolve our business activities andimprove levels of satisfaction. Comments
and requests from customers throughchannels such as exhibitions and ouronline shopping site are used to help
improve our products and services. We
exchange information with our business
partners on subjects such as
management policies and products andwork together to mutually improve
quality through our Level-Up activities.

Rinnai America donated 1,251 sanitary items to the Bloom Closet
organization. Bloom Closet is a foster child support organization that sells
sanitary items and clothing at low prices for foster children. Rinnai America isalso engaged in a variety of other charitable activities.

Donation of sanitary items to a foster child support organization

ThailandEach year, Rinnai Thailand employees hold an environmental
protection event. In August 2019, 50 employees planted 150
mangrove trees in Samut Sonkhram province.

Planting mangrove trees

BrazilEmployees

Communication with
Our Stakeholders
Shareholders
Investors

Business
Partners

Donation of hot water heater to a temporary hospital

Community, Society(Including government)

South Korea
Together with the 2020 social welfare corporation “Warm Accompaniment”,
Rinnai Korea donated gas clothes dryers at 44 locations where families livewith disabled persons who are preparing to live independently. Housing inwhich disabled persons can live independently are constantly short of spacesince various household items must be placed as needed for life in awheelchair. Gas dryers are highly appreciated for drying clothes quickly andeliminating the need to hang clothes to dry.
Donation of gas clothes dryers to a social welfare facility

TaiwanRinnai Taiwan’s health promotion activities in 2019 included a contest to lose weight and reduce fat called“Together, Health, Beauty, Summer” aimed at reducing the health metrics of body mass index (BMI) andtotal cholesterol of its employees. Health checks showed a major improvement in these metrics, and in
January 2020, Rinnai Taiwan was awarded the “Health Start Mark Certification for Healthy Workplaces”
by the Health Promotion Administration of the Ministry of Health and Welfare of Taiwan.
Award related to health presented by the Ministry of Health and Welfare of Taiwan

101

Opinions and Issues Raised and Our Responses• Customer Center• Exhibitions / Other
events• After-sales services(inspection and repairs)• Official online shoppingsite “R.STYLE”• New Year meetings(policy presentations)• New product workshops
utilizing internal facilities• Corporate site
• Product information site

• We conscientiously answer a range of inquiries from customers concerning products and parts, and post frequently asked
questions (FAQ) on our website.
• Customers who have had repairs done are surveyed to gauge their satisfaction with elements of service such as “ease ofgetting through by phone” and “politeness of operators.” Details of responses are then fed back to operators so that they
can remedy unsatisfactory areas.
• The Maintenance Check Call Center was established to handle inquiries regarding inspection notifications, inspection
notice functions, and schedule inspections. A simple explanation of the inspection system is provided to customers who are
not registered owners and guidance is provided to receive inspections for safety.
• We provide guidance on legal compliance inspections for customers who registered their products in accordance with the“long-term use product safety inspection system” as they reach their 9th year of use. For products not applicable underlegal compliance inspection regulations, we strive to improve customer safety by sending safety inspection notifications
based on the “long-term use product safety inspection system.”• Rinnai conducts web-based questionnaires (customer satisfaction surveys) with customers who make purchases on our
website. These questionnaires concern purchased products, service window support, the sales site itself, and productdelivery and packaging. The Company provides all related offices with feedback regarding questionnaire results andconducts initiatives to improve issues related to responses that indicate low customer satisfaction.
• We are expanding Hot.Lab, our hands-on product induction facility, and working to increase customer knowledge andunderstanding regarding our merchandise.

• Individual discussions• Workplace meetings• Training / Events• Corporate ethics
advisory service• In-house intranet /In-house newsletter• Information exchangewith employee unions• In addition to regular interviews targeting all employees, we conduct feedback interviews regarding personnel evaluations,pre-partum and postpartum childcare leave, and interviews when returning to work. By creating rules for interviews with
employees in Japan and those transferred overseas, we are strengthening our support for individual growth and workplacecommunication to create a better work environment.
• To collect and accurately respond to requests from employees in all departments, the Company regularly holds
conferences between its Personnel Department and employee unions, the results of which are used to revise internal
systems and improve work environments.
• Rinnai conducts nursing care seminars and provides nursing care-related information based on nursing care questionnaire
results. The Health Support Office plays a central role in promoting employee health through health campaigns that checkblood vessel age, bone density, iron content, and skin age as well as walking seminars for weight loss and physical fitness.
• Since 2005, we have been operating a corporate ethics advisory service. This internal reporting system enables employees
to report fraudulent activity and violations of laws, ordinances, or internal regulations in cases when consulting with theirsuperiors is problematic.

Customers(Users) (Distributors)

In May 2020, Rinnai Brazil donated hot water heaters for a temporary hospital(Campo Grande University Hospital) established to treat COVID-19 patientsin Campo Grande City. Working in cooperation with Copagaz, a major
supplier of LPG, Rinnai Brazil installed a gas hot water supply system in thetemporary hospital.

Means ofCommunication• General shareholders’meetings• Results briefings• Factory tours• Investor relations (IR)meetings• Questionnaires• We carefully explain our “Evolution and Succession 2017” medium-term business plan at results briefings and individual IR
meetings, and endeavor to improve understanding of the Group’s management policy and strategy.

• New Year meetings• Policy presentations for
suppliers• Level-Up Workshop• Online communication
tool, “R-LINE”• Rinnai responds to inquiries from suppliers regarding its production system and trends as needed, informing them ofimportant information, such as changes in production plans, through the communication tool R-LINE. We also explain thisinformation through our Supplier Liaison Group meetings.

• We regularly organize facility and factory tours for institutional investors to give them a better understanding of our strengths
and competitive advantages, and to outline our approach to manufacturing and technical capabilities.
• We hold results briefings and individual IR meetings to answer inquiries and explain our underlying thinking on dividend
policy.

• Responding to requests from suppliers for advice on, e.g., improving quality and productivity, we organize Level-Upworkshops and help suppliers to make improvements in the workplace.

• We are asked by people living near our plants and offices to assist with events and festivals aimed at enlivening their• Participation in local /communities, and we actively assist and take part in such events as a member of these communities.
community development
activities• Rinnai continues to support exchanges with citizens and creative activities by collaborating with cultural and artistic• Support for cultural activities activities conducted in the area surrounding the Nakagawa canal, where our head office is located.
and the arts
• In response to requests for assistance with community learning and school education, we organize events such as• Employee volunteer activities seminars on the history of manufacturing at Rinnai and factory tours for schoolchildren.
• Support for extracurricularschool activities (factory
tours, etc.)

Results of Questionnaire Regarding “CSR Report 2019” n=275
We sent a questionnaire to readers of our 2019 CSR Report and asked them to vote on topics they found interesting.
We intend to incorporate the results of this questionnaire in our next edition.
CSR Report 2019

Response rate

Aiming for the Realization of Healthy and Comfortable Lifestyles and Sustainable Societies
Corporate Mission and Vision
Top Message
Rinnai Group Profile
Rinnai Group CSR
Environmental Impact within Rinnai’s Value Chain
Stakeholder Engagement
Value Creation Process
Contributing to healthy and comfortable lifestyles through the diffusion of gas clothes dryers
Approaches to providing customers with safety and peace of mind by improving the safety functions of our gas stoves
Initiatives to prevent global warning through energy-saving water heaters
Communication with Employees
Communication with Stakeholders
Management Structure
Data Collection

0

10

20

30

40

50 (%)

Rinnai Report 2020 102

Data Collection
Eleven-Year Financial Summary

FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020Net sales(Millions of yen)

226,117

239,436

246,636

251,832

286,981

295,022

319,935

330,256

347,071

348,022

340,460

Operating income(Millions of yen)

20,392

25,23826,63426,35134,01830,787

34,59334,05632,84930,87934,422

(%)

9.0%

10.5%

10.8%

10.5%

11.9%

10.4%

10.8%

10.3%

9.5%

8.9%

10.1%

Ordinary income(Millions of yen)

21,481

26,82428,90729,06436,91032,93835,80735,28034,28633,31835,679Net income attributable to owners of theparent company(Millions of yen)

11,642

15,51016,807

19,371

23,254

20,64722,71022,322

21,194

20,48021,561

Total net assets(Millions of yen)

142,502

141,110

154,737

178,007

232,635

261,414271,709290,638

307,965

320,696

340,959

Total assets(Millions of yen)

222,324

221,495

238,853

262,590334,382355,140

368,084

402,107422,422430,885

450,486

Net assets per share(Yen)

2,684.46

2,798.07

3,070.14

3,516.11

4,245.48

4,742.42

4,924.24

5,245.62

5,589.17

5,819.80

6,140.52

Net income per share(Yen)

219.83311.52342.60394.86454.74397.03436.71429.27410.41398.45419.49Equity ratio

(%)

62.5%

62.0%

63.1%

65.7%

66.0%

69.4%

69.6%

67.8%

68.0%

69.4%

70.1%

Return on equity

(%)

8.5%

11.2%

11.7%

12.0%

11.8%

8.8%

9.0%

8.4%

7.6%

7.0%

7.0%

Cash flows from operating activities(Millions of yen)

29,687

27,536

23,07422,87236,45325,671

36,06639,55429,91429,47937,694

Cash flows from investing activities(Millions of yen)

(15,865)(10,634)(16,222)(12,607)(32,908)(23,649)(17,770)(17,732)(12,190)(7,288)(7,124)

Cash flows from financing activities(Millions of yen)

(12,203)(16,958)(3,937)(5,002)

13,183(8,659)(6,554)(5,217)(11,725)(6,150)(6,436)

Cash and cash equivalents at end of year

(Millions of yen)

46,57046,14548,64855,03074,27969,34079,60095,297

101,697

116,133

140,138

Capital expenditures(Millions of yen)

9,380

7,590

9,378

8,222

12,43913,774

16,93820,664

16,105

13,481

10,580Research and development expenses(Millions of yen)

6,764

6,934

7,665

8,060

8,380

8,895

9,113

9,340

9,918

9,503

9,308

Operating income margin

Dividends

(Yen)

42

48

56

60

68

76

82

86

90

94

98

Payout ratio

(%)

19.1%

15.4%

16.3%

15.2%

15.0%

19.1%

18.8%

20.0%

21.9%

23.6%

23.4%

Number of outstanding shares(Shares)

54,216,463

54,216,463

54,216,463

54,216,463

52,216,463

52,216,463

52,216,463

52,216,463

51,616,463

51,616,463

51,616,463

Closing price at the end of the period

(Yen)

4,910

5,520

5,960

6,770

9,070

8,910

9,940

9,230

10,100

7,830

7,650

(Millions of yen)

266,203299,275

323,130

367,045473,603465,249

519,032

481,958

521,326

404,157

394,866

Market capitalization* We apply the Partial Revisions to Accounting Standards for Tax Effect Accounting (Corporate Accounting Standards No. 28, February 16, 2018) as of fiscal 2019. As such, figures for fiscal
2015–fiscal 2018 have been adjusted to retroactively apply said accounting standards.

103

Rinnai Report 2020 104

Data Collection
Financial Data

Consolidated

Rinnai Corporation

Results of profit
and loss

Domestic
consolidated andaffiliated companies
Overseas
consolidated
companies

Total

Consolidated

Rinnai Corporation

Sales by product

Domestic
consolidated andaffiliated companies

Overseas
consolidated
companies

Total

Rinnai America

Rinnai Australia
Results of profit andloss by overseas
consolidated
Shanghai Rinnai
subsidiaries(Before eliminationof consolidation)
Rinnai Korea

Rinnai Indonesia*(Millions of yen)

FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Water heaters
Kitchen appliances
Conditioning appliances
Commercial-use appliances
OthersWater heaters
Kitchen appliances
Conditioning appliances
Commercial-use appliances
OthersWater heaters
Kitchen appliances
Conditioning appliances
Commercial-use appliances
OthersWater heaters
Kitchen appliances
Conditioning appliances
Commercial-use appliances
OthersWater heaters
Kitchen appliances
Conditioning appliances
Commercial-use appliances
Others
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income
Net sales
Operating income
Ordinary income
Net income

226,117
20,392
21,481
11,642
169,277
13,455
15,5158,654
85,884
1,835
2,030
1,127
71,023
4,832
4,647
3,307
326,185
20,122
22,19313,088105,906
78,66914,635
6,268
20,63678,08665,523
10,873
2,756
12,037
19,164
26,511
1,213
1,718
37,27538,585
12,129
6,118
5,357
8,832
135,837
104,165
18,205
9,832
58,145
12,799553
535
290
12,618
1,595
1,836
1,277
12,207
1,500
1,537
1,255
20,318
516
150
53
-

239,436
25,23826,824
15,510175,045
16,131
17,647
10,46791,097
1,821
2,029
545
79,872
6,884
7,085
5,338
346,015
24,837
26,762
16,351
114,534
79,60015,754
6,739
22,806
81,614
66,91011,0672,630
12,822
21,39527,332
1,149
1,614
39,605
43,626
11,781
7,889
5,665
10,909146,636
106,024
20,106
9,910
63,337
13,041796
803
519
15,367
2,719
3,011
2,095
12,953
1,258
1,350
1,124
21,107
733
442
545
-

246,636
26,63428,907
16,807183,091
18,04522,573
13,86997,082
2,071
2,270
1,238
76,806
6,179
7,077
5,345
356,979
26,29731,921
20,452
121,028
78,792
16,681
6,846
23,28688,00566,34812,296
2,638
13,803
24,412
26,0481,308
1,605
43,70744,058
11,661
7,244
4,570
9,271
156,476
104,058
20,8498,813
66,782
11,584242
243
174
14,996
3,137
3,877
2,704
12,907556
650
549
20,574
717
598
643
-

251,832
26,351
29,064
19,371
188,559
18,066
19,911
12,80496,824
2,403
2,571
1,573
77,083
5,963
6,584
6,224
362,467
26,432
29,067
20,603
127,125
78,782
15,666
6,912
23,346
92,60866,62912,0292,748
14,54325,513
24,955
1,147
1,618
43,58845,218
11,465
6,227
4,624
9,548
163,340
103,050
19,404
8,991
67,67911,333315
317
200
13,752
2,186
2,611
1,818
14,207
1,175
1,300
1,082
19,720
725
638
1,818
-

286,981
34,01836,91023,254
205,598
24,27827,13818,176105,111
2,775
2,881
1,889
99,152
7,255
8,260
6,006
409,862
34,30838,28026,071
146,883
88,031
16,716
7,552
27,797
103,942
71,953
12,0692,692
14,941
27,19928,435
1,051
1,474
46,94957,906
15,828
7,631
5,311
12,474
189,048
116,217
20,753
9,477
74,364
15,487845
849
536
15,272
2,337
2,776
1,939
20,652
1,650
1,817
1,461
25,054
407
519
301
-

295,02230,78732,93820,647
190,475
18,67522,073
15,33999,967
2,086
2,199
1,426
126,880
9,921
11,026
8,497
417,323
30,68235,29925,262
153,697
90,838
14,972
9,227
26,287
99,636
62,236
10,725
2,673
15,203
26,71424,006786
1,620
46,83870,902
29,246
7,309
7,114
12,307
197,253
115,489
18,822
11,40874,34917,754
1,020
1,036
667
15,360
1,456
1,634
1,130
27,202
2,174
2,472
1,972
31,215
1,371
1,236
1,184
11,733
1,366
1,879
1,456

319,935
34,59335,80722,710
197,592
20,191
21,946
15,602
99,599
2,552
2,735
1,902
149,987
11,636
12,542
9,236
447,178
34,38037,224
26,741
169,623
93,34019,463
10,041
27,466
105,999
62,849
9,965
2,675
16,10328,25922,260628
1,590
46,85984,33531,346
12,8288,010
13,465
218,594
116,457
23,422
12,27676,42722,602
1,817
1,841
1,145
23,137
1,366
1,522
1,049
33,958
2,727
3,016
2,378
33,594
1,356
1,551
1,144
11,640
1,486
1,707
1,334

330,256
34,05635,28022,322
198,870
18,814
21,512
16,215
124,806
3,626
3,837
2,029
149,917
12,45313,0609,411
473,595
34,89438,40927,655
188,20288,456
17,952
9,122
26,521
109,258
61,3598,945
2,629
16,677
51,822
21,139669
1,609
49,56488,08228,368
12,212
7,206
14,047249,163
110,868
21,827
11,44580,29023,504
1,661
1,644
1,037
21,515
1,461
1,447
998
37,448
3,136
3,268
2,519
32,254
1,233
1,306
1,043
11,327
2,052
2,295
1,776

347,071
32,84934,286
21,194201,936
15,37818,466
13,850125,536
2,749
2,924
2,069
169,125
14,765
15,555
11,673
496,597
32,89336,946
27,593202,387
88,36419,084
9,499
27,735112,561
59,5099,535
2,308
18,021
52,28019,128678
1,501
51,946104,149
29,80913,116
7,689
14,360268,992
108,448
23,32911,49884,32827,738
2,207
2,219
1,254
23,585
1,803
1,847
1,208
45,969
5,133
5,223
4,283
34,905727
802
499
12,041
1,952
2,209
1,720

348,02230,87933,31820,480206,015
14,602
19,026
14,175
122,181
2,748
3,014
2,087
175,756
13,64014,932
11,510503,953
30,991
36,973
27,773
202,630
88,322
19,642
8,452
28,974
116,81058,8529,139
2,226
18,98649,21018,934714
1,337
51,985
110,131
30,746
13,791
6,708
14,379276,151
108,533
23,645
10,27285,35130,390
1,491
1,481
1,100
25,033
1,720
2,065
1,459
47,511
5,088
5,319
4,378
32,803102
269
242
12,840
1,828
2,076
1,620

340,460
34,42235,67921,561
207,805
17,35920,295
15,058
101,938
3,248
3,476
2,475
171,40912,242
13,182
10,604
481,153
32,85036,95428,138196,122
86,19318,901
8,556
30,685
115,908
59,934
8,658
2,225
21,07933,583
15,611704
1,363
50,676
107,979
29,736
13,294
6,943
13,454257,471
105,282
22,657
10,532
85,21033,133
2,032
2,025
1,436
23,760593
393
262
43,628
5,593
5,868
5,228
27,535(1,382)(1,248)(987)
11,263
1,600
1,906
1,504

* Rinnai Indonesia has been included into Rinnai’s consolidated financial statements from the fiscal year ended March 2015 (it has been included in the consolidated balance sheets as of the
fiscal year ended March 2014).

105

Rinnai Report 2020 106

Human Resource- and Personnel-Related Data
The Rinnai Group
Number of Full-time Employees (Consolidated, Year-end)
Rinnai Corporation
Domestic Group
companies
Overseas Group
companies

Male
FemaleMale
FemaleMale
FemaleTotal

Fiscal 2018

Fiscal 2019

Fiscal 2020

2,540
1,125
1,463
680
3,355
1,408
10,571

2,594
1,108
1,362
682
3,404
1,463
10,613

2,631
1,127
1,282
650
3,295
1,466
10,451

Managerial Position
Appointment Status(People)* End-FY2020 Compiled
from the Rinnai parent

Japan

Asia, excluding Japan

North America
Other(Oceania, SouthAmerica, and Europe)
Total

Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal

Fiscal 2019

Fiscal 2020

Composition

4,003
1,805
5,808
2,626
1,133
3,759
167
57
224
562
218
780
10,571

3,956
1,790
5,746
2,612
1,138
3,750
191
90
281
601
235
836
10,613

3,913
1,777
5,690
2,498
1,137
3,635
215
101
316
582
228
810
10,451

—
—
54.4%
—
—
34.8%
—
—
3.0%
—
—
7.8%
100%

Fiscal 2018

Fiscal 2019

Fiscal 2020

656
481
1,137
697
347
1,044
654
217
871
523
79
602
10
1
11
4

625
432
1,057
695
357
1,052
681
231
912
577
87
664
16
1
17
2

Under 30

583
399
982
714
392
1,106
689
237
926
631
97
728
14
2
16
3

30–39

40–49

50–59

60 or older
Number of non-Japanese employees

Fiscal 2020
Female ratio

31%

31%

32%

28%
31%

Newly recruitedemployees
Mid-career recruitment
Temporary staff
Average working years

Average age (Years old)

107

Male
FemaleSubtotal
Male
FemaleSubtotal
Subtotal
Male
FemaleSubtotal
Male
FemaleSubtotal

Fiscal 2019

Fiscal 2020

80
59
139
4
10
14
379
16.8
12.1
15.4
38.8
33.3
37.1

81
50
131
3
6
9
283
16.6
12.7
15.5
39.3
34
37.7

62
22
84
2
6
8
376
17.3
13.3
16.1
39.7
34.5
38.2

Ratio of Women (%)

3

663

0

0.45

Of which are general managers or higher

0

36

0

0

Director
Of which are executive directors

0
0

24
13

0
0

0
0

Fiscal 2018

Fiscal 2019

Fiscal 2020

2.5
20
9.7
53.3
60
1.90
25
1.99
17
90
1
106
107
100
100
100
0
96
96
0
36
36
2
2
4
0
1
1
0
0
0

2.7
20
10.5
57.1
66
2.05
26
2.01
13
82
0
117
117
100
100
100
0
109
109
1
53
54
1
3
4
0
2
2
0
0
0

2.3
20
12.1
58
74
2.23
37
2.82
21
57
0
123
123
—
100
100
0
131
131
1
48
49
1
4
5
1
4
5
1
2
3

Male

0

1

59*

Number of employees utilizing work from home
programs unrelated to COVID-19 countermeasures: 1
Number of employees utilizing work from home
programs related to COVID-19 countermeasures: 54

Female32

14*

Number of employees utilizing work from home
programs unrelated to COVID-19 countermeasures: 4
Number of employees utilizing work from home
programs related to COVID-19 countermeasures: 10

Subtotal3

3

73

Number of employees who
used the work from home
program

Male*General Managers, Factory General Managers, Branch General
Managers, Deputy Branch General Managers, Managers

Working Hours and Average Wages

Number of Employees (Non-consolidated)
Fiscal 2018

FemaleNumber of days added with paid leave* Rinnai parent Based on the status of
Number of days taken with paid leave
leave taken by permanent employees
Utilization ratio (%)
Number of persons with disabilities
Employment of persons withdisabilities
Employment rate (%)
Number of the accident
Number of OJT accidents*Includes domestic consolidated subsidiaries
Number of the disasters(%)(LTIFR)
Number of employees on mental health leave
Number of employees who used childcare leave
Male
Number of employees who
took childcare leaves ofFemaleabsence
Subtotal
Male
Proportion of employees who
return to work after taking
Femaleparental leave (%)
Subtotal
Male
Number of employees who
Femaleused shortened work hours
Subtotal
Male
Number of employees who
Femaleused family care leave
Subtotal
Male
Number of employees who
Femaleused nursing leave
Subtotal
Male
Number of employees who
Femaletook nursing leaves of absence
Subtotal
Male
Number of employees who
used our reemployment
Female(Come Back) system
Subtotal

Rinnai Corporation
Employee Ages
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Subtotal

Executive Position

Voluntary termination rate (%)
Paid leave

Number of Full-time Employees by Region (Consolidated, Year-end)
Fiscal 2018

Non-JapaneseSupervisory Position

Newly recruitedemployee retention(People)Male
FemaleSubtotal

Newly recruitedemployees in April 2017

Employees retention in
April 2020

80
59
139

71
51
122

Annual total actual working hours per employee (Hours)*1
Annual non-scheduled working hours per employee (Hours)*1
Average overtime per month (Hours)*1
Average wage (Yen)*1
Highest wage at 30
Average wages at 30 years old
Lowest wage at 30(Yen)
Average wage at 30

Fiscal 2018

Fiscal 2019

Fiscal 2020

2,123
229
19.4
6,163,282
303,750
253,950
283,761

2,097
217
18.7
6,201,012
309,750
242,850
277,744

2,008
199
16.6
6,309,876
311,750
256,850
289,647

Fiscal 2019

Fiscal 2020

Others (Social Contribution and Compliance)
Fiscal 2018

Number of whistleblower incidents *Includes domestic consolidated subsidiaries
Criminal charges for compliance related accidents and incidents (Numberof cases)*2
Total expenditure on social contribution activities (Millions of yen)
Political contributions and lobbying activities expenditures (Millions of yen)

9

5

6

0

0

0

15
1

14
1

14
1

* 1. Excluding managers* 2. In fiscal 2019, subsidiary Noto Tech Co., Ltd., exceeded the standards for wastewater and submitted an improvement report to the local government.
The results of water quality analysis after countermeasures were implemented confirm that the standards have been maintained without any problems.

Rinnai Report 2020 108

Data Collection Environmental Data
Basic Environmental Activities (“7E” Strategic Initiatives)
Rinnai has set the long-term goal of “achieving 6.40 million tons of CO2 reduction by 2030” and promotes environmental
activities with the participation of all employees in all business areas based on the “7E Strategy” environmental action
plan to be achieved by 2020.
Below is a report regarding targets, results, and estimated results for each of the Basic Environmental Activities’
seven Es (E-marketing, E-services, E-products, E-procurement, E-minds, E-factories, and E-offices).

Basic Environmental Activities and Targets for Fiscal 2019–2021
Field
Environment marketing (Sales)
Environmental services(Construction and repair)
Environmental products(Product development)

Scope: Rinnai Corporation
Reporting Period: April 1, 2019 to March 31, 2020

Fiscal 2020 Results
Field

Fiscal 2020 Targets

Fiscal 2020 Results

Environmental marketing (Sales)
Environmental services(Construction and repair)2.72 million metric tons of avoided CO2 emissions

2.61 million metric tons of avoided CO2 emissions

Environmental products(Product development)

Reducing Energy Usage and CO2 Emissions• Developing highly efficient gas water heaters• Reducing standby power usage

Basic Environmental Activities (“7E Strategy”)(2018–2020)

Resource Conservation and Recycling• Implementing product assessments• Developing resource-saving equipment

Expanding Sales of Environmentally Friendly Products (Japan & Overseas)
Contributing to CO2 reduction*1 of 3.32 million tons by fiscal 2021.
Energy Consumption and CO2 Emissions Levels
Continuously develop high-efficiency equipment for Zero-Energy Homes (ZEH) and products that use
less power during both standby and use

Environmental procurement

Conserve and Recycle Resources
Continuously evaluate each product’s environmental impact from its design stage through its lifecycleand develop smaller and lighter products
Environmental procurement

Promote Supply Chain Management
Conduct environmental conservation activities in cooperation with business partners, and continuously
conduct green procurement management in compliance with regulations in each country

Environmental minds (Regional
communities and employees)

Communication of ESG-related Information
Continuing with initiatives that contribute to enhancing our environmental brandEnvironmental minds(Regional communities andemployees)

Promote supply chain management• Strengthening ties with business partners• Implementing management in line with theregulations of each country

Communication of ESG-related Information• Communicating by creating opportunities tointeract with various stakeholders

Contributing to Local Communities
Continuing with initiatives that contribute to conserving biodiversity
Contributing to Local Communities• Holding events to enhance awareness and theability to take action with regard to biodiversity• Implementing activities to contribute incollaboration with local authorities, organizations,and schools, etc.

Conducting Environmental Training and Awareness Activities
Continuing with initiatives that foster environmental awareness and the enhance ability to take action in
employees through training
Environmental factories
Environmental offices

Reduce basic unit of energy consumption*2 by more than 4% compared to fiscal 2017 by fiscal 2021
Reduce rate of waste discharge*2 by more than 4% compared to fiscal 2017 by fiscal 2021
Maintain and advance zero-emissions initiatives

Implementing Environmental Training andAwareness Activities• Implementing environmental training andawareness activities for employees

Reduce rate of water use*2 by more than 4% compared to fiscal 2017 by fiscal 2021
Reduce rate of harmful chemicals*2 handled by more than 4% compared to fiscal 2017 by fiscal 2021

Environmental factories
Environmental offices

109• Developing highly efficient gas water heaters andkitchen equipment• Implementing designs to reduce the weight ofwater heaters and gas stoves• Receiving an Honorable Mention at the EcoPro
Awards in recognition of Rinnai’s ECO ONE
hybrid water heater and heating system in Japan,
highly efficient hot water heaters in the U.S., andgas boilers in China•U
 nderstanding the status of environmental
activities through a questionnaire (Respondents:
350 companies)• I mplemented operation based on Rinnai’s Green
Procurement Standards Guide (materials
procurement and usage, including newcomponents)•E nhanced the management level of chemical
substances by strengthening connectivity withbusiness partners• Exhibiting at EcoPro and other environmental
exhibitions• Implementing showroom and factory tours
nationwide• Disclosing ESG information for the Rinnai Group• Implementing efforts to exterminate specified
invasive species at multiple worksites• Holding events to get closer to greenery bycultivating heirloom vegetables• Holding multiple environmental awarenessevents during Environment Month• Received the “Excellence Award” in theEnvironmental Persons Development Awards inrecognition for Rinnai’s initiatives to foster
environmentally conscious personnel.

Reduce rate of energy consumption*2 by morethan 3% compared to fiscal 2017

Reduced by 9.7% compared to fiscal 2017

Reduce rate of waste discharge*2 by more than 3%compared to fiscal 2017
Maintain and advance zero-emissions initiatives

Reduced by 1.6% compared to fiscal 2017

Reduce rate of water consumption*2 by more than
3% compared to fiscal 2017

Increased by 10.9% compared to fiscal 2017

Reduce rate of harmful chemicals*2 handled bymore than 3% compared to fiscal 2017

Increased by 5.5% compared to fiscal 2017

Realized recycling rate of 99.9% or higher

Notes: 1. CO2 reduction contribution = Reduction in CO2 emissions compared to products sold in 2005 resulting from improved performance of Rinnai water heaters (estimated)
Concerns emissions produced through markets in Japan and the United States.
2. Basic unit: Burden per unit standard determined by Rinnai.
Rinnai Report 2020 110

Impact on the Environment of the Rinnai Group

Energy Consumption
Scope

Rinnai is working to achieve full comprehension of all environmental impact related to its business activities. In particular,
we have identified three important issues involving environmental impact: Energy consumption, CO2 emissions (Scope 1
and 2) and use of sold products (Scope 3, Category 11), which produces overwhelmingly high emissions. With regard tothese three issues, we are implementing third-party inspections and are working to ensure the accuracy and reliability of
information disclosure.

Electricity

MethaneRinnai Corporation and consolidated subsidiaries
Company Name
• Rinnai Corporation• Yanagisawa Manufacturing Co., Ltd.
• Rinnai Technica Co., Ltd.
• Gastar 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.
• Rinnai Net Co., Ltd.
• RG Co., Ltd.
• Rinnai Enterprises• Rinnai Holdings (Pacific) Pte Ltd.
• Rinnai Hong Kong Ltd.
• Guangzhou Rinnai Gas and Electric Appliance Co., Ltd.

• Rinnai Italia S.r.l.
• Rinnai Canada Holdings Ltd.
• Shanghai Rinnai Thermo Energy Engineering Co., Ltd.
• Rinnai America Corporation• Rinnai Australia Pty., Ltd.
• Shanghai Rinnai Co., Ltd.
• Rinnai Korea Corporation• P.T. Rinnai Indonesia• Rinnai New Zealand Ltd.
• Rinnai Taiwan Corporation• Rinnai (Thailand) Co., Ltd.
• Rinnai Brasil Heating Technology Ltd.
• Rinnai Viet Nam Co., Ltd.
• RB Korea Ltd.
• Gas Appliance Services Corporation

Reporting Period

Third-Party Assurance

Domestic: From April 1, 2019 to March 31, 2020
Overseas: From January 1, 2019 to December 31, 2019

✓ Thisicon indicates that a measure has been third-party

Gasoline
Gasoline

assured by Lloyd’s Register Quality Assurance (LRQA).

1,171

Total amount ratio of the entire value chain(CO2 emissions) * 1
Scope 3 Category 1
Purchased goods / services

1,107

Fiscal 2019
123,664.3

Eco-friendly products(contribute to reduction of CO2 emissions)(1,000 tCO2e)
6,000

6,040

820,000 t

Fiscal 2020
Assurance✓□
117,642.1

kNm3

11,096.6

11,220.3

10,391.1

✓
□

kNm3
km3

2.0
34.0

1.4
35.0

1.2
38.7

✓
□
✓
□

t

3,171.0

2,843.1

2,538.0

✓
□

t
t
t
t
kl
kl

3.4
68.5
−
−
0.20
20.7

1.0
16.5
7.7
0.03
0.18
21.3

1.4
13.8
7.7
0.07
0.18
18.5

✓
□
✓
□
✓
□
✓
□
✓
□
✓
□

kl

18.1

136.1

107.2

✓
□

kl

391.7

431.3

419.6

✓
□

kl

6.4

5.5

5.1

✓
□

kl
GJ

1,933.6
1,171,151

2,098.7
1,192,078

1,819.3
1,106,557✓□✓□

CO2 Emissions
Scope

Unit

Scope 1*1
Scope 2*2

6
7

Purchased goods andservices
Capital goods
Fuel- and energy-related
activities
Upstream transportationand distribution
Waste generated inoperations
Business travel
Employee commuting

8

Upstream leased assets

1
2
3
4
5

tCO2e

Downstream
transportation anddistribution
Processing of sold10
products
11 Use of sold products
End-of-life treatment of
12
sold products
Downstream leased
13
assets
14 Franchises
15 Investments
Total of Scope 1, 2, and 3

Fiscal 201840,313
67,977

Fiscal 201940,25473,181

Fiscal 2020
36,723
66,239816,828

866,847

821,979

52,72425,928

2,955

3,263

10,803

Percentage
Assurance
✓
□
0.32%
✓
□
0.58%
7.16%

−

21,078

0.18%

−

4,379

0.04%

−

8,838

8,377

0.07%

−

733

565

5,668

0.05%

−

524
1,557
Included in
Scope 1530
1,592
Included in
Scope 1535
1,598
Included in
Scope 1

0.00%
0.01%

−
−

−

−

Not applicable

−

−

−

−

−

Not applicableNot applicable−−

11,204,402

10,825,493

10,511,507

91.53%

✓
□

6,580

5,414

5,942

0.05%

−

Not applicableNot applicableNot applicable−−Not applicableNot applicable
12,205,396

Not applicableNot applicable
11,851,905

Not applicableNot applicable
11,484,025−−
100.00%−−*1 Scope 1: The volume of greenhouse gases that are leaked directly into the Earth’s atmosphere from sources related to Rinnai’s business activities*2 Scope 2: The volume of emissions that occur during electricity and heat generation phases when using electricity and heat supplied by third parties*3 Scope 3: The volume of emissions that occur during business activities conducted throughout Rinnai’s supply chain (excluding those in Scope 1 and 2)(7.16%)

1,000

4,000

800

3,320

Total of Scope 1, 2, 3

11,480,000 t

600

2,540

Shipping Volume and CO2 Emissions

2,610

2,000

400

Scope

200
0

0
Fiscal 2018

Fiscal 2019

Fiscal 2020

Scope 3 Category 11
Use of sold products

10,510,000 t (91.53%)

111

Fiscal 2018
118,733.3

9

Global Warming Prevention

1,192

for the use of equipmentin each facility
for vehicle use
for the use of equipmentin each facility
for vehicle use

Light oil

Scope 3*3

(TJ)
1,200

for the use of equipmentin each facility
for vehicle use

ＬＰＧ
ButaneAcetylene
Ethylene
Heavy oil
Heating oil

Scope of Accounting

Total energy used

for the use of equipmentin each facility
for vehicle use

Town gas

Unit
MWh

Fiscal 2019 Fiscal 2020

Fiscal2021(Target)Fiscal2031(Target)

Unit

Fiscal 2018

Fiscal 2019

Fiscal 2020

Shipping volume

Millions tons/
km

69.52

58.15

58.37

CO2 emissions

tCO2e

10,803

8,838

8,377

Rinnai Report 2020 112

Resource Recycling, Pollution Prevention, and Protecting Biodiversity

Environmental Accounting
Breakdown of Costs forEnvironmental Protection

Solid waste

Water used(includes valuable substances)(1,000 m3)
1,000

(kg)
400

935
859

30

29

31

Pollution
prevention

Biodiversity

31

800

Mainly efforts to prevent air and waterpollution

Fiscal 2020

44

27

Environmental
Mainly efforts to save energy
protection

36

15

31

Resource
recycling

Recycling as well as treatment anddisposal of industrial waste

104

102

117

Upstream/downstream

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

8

11

12

Management activities

Mainly monitoring and surveillance ofenvironmental impact

153

150

109

Research and development

Research and development onenvironmentally conscious products

1,117

1,149

733

Community efforts

Environmental communication withlocal regions and beautification/
greening at places of business andsurrounding areas

2

2

2

In the scope ofoperations

360

Costs (Millions of yen)
Fiscal 2019

Fiscal 201838

(Weight of exterminating specified invasive species)(1,000 t)
40

Key Activities

808
300

600
20

200

180

400
10

100

200

30
0
Fiscal 2018

Fiscal 2019

Fiscal 2020

0
Fiscal 2018

Fiscal 2019

Unit

0

Fiscal 2020

Fiscal 2018

Fiscal 2018

Fiscal 2019

Fiscal 2019

Fiscal 2020

Fiscal 2020

Waste Generated (Including valuables)

Thousand tons

29

31

31

Recycled Waste

Thousand tons

27

31

29

Waste into landfill

Thousand tons

1.6

1.2

1.8

Water Withdrawal

Thousand m3

935

859

808

Discharge of Water

Thousand m3

881

846

778

Hazardous Chemicals* Use

t

50

36

Weight of exterminating specified invasive species

kg

30

Number of people participated in the extermination of
specified invasive species

Persons

15* Class I designated chemical substance stipulated by the Pollutant Release and Transfer Register (PRTR) Law, Scope: Rinnai Corporation

Key Activities

Unit

Fiscal 2018

Environmental Impact Reduction
Fiscal 2019
Fiscal 2020

CO2 emissions
reductions

Thousand tCO2e

0.8

2.0

6.0

33

Waste curtailment

Thousand tons

3.3

0.4

0.3

180

360

Water saving

Thousand m3

11.0

6.7

17.0

63

89

Environmental protection
effectEconomic EffectAccompanying
Environmental
Protection Measures

Key Activities
Reduced expenses through energy
conservation, waste curtailment, andwater saving

Fiscal 2018

Economic Effect (Millions of yen)
Fiscal 2019
Fiscal 2020
400

270

295

• The calculations above exclude depreciation and amortization expense.
• The economic effects achieved through energy-savings and waste reduction are not increases or decreases in overall costs but rather an effective amount regarded for its
economic benefit through the associated activities of each site.
• 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.

113

Rinnai Report 2020 114

Chronology of Environmental Activities at Rinnai
1993
1994
1996

1997

1998

1999

2000

April Won top prize for gas clothes dryer and special awards for small hot-water heater and for absorption-type gas air conditioner
at 3rd Eco-Design Awards
October Market debut: Yukko V Series, featuring no styrene packing, low stand by power consumption and low NOx emissions
June Environment Month event: Talk given at Rinnai by a corporate environmental pioneer
July Established Environment Division
September Market debut: Ecomax burner and Eco burner-equipped gas cooking stove
October Market debut: Condensing water heater boasting 95% heat efficiency and NOx emissions under 30 ppm

June Environment Month event: Talk given at Rinnai by a corporate environmental pioneer
June Environment Month event: Talk given at Rinnai by a corporate environmental pioneer
October Won Electric Equipment Packaging Category Award in the Good Packaging division at Japan Packaging Contest 2003 forbuilt-in 75 cm-wide glass-top gas cooking stove

2004

June Environment Month event: Talk given at Rinnai by a corporate environmental pioneer
October Won Logistics Prize at Japan Packaging Contest 2004 for bathroom heater/dryer
December Created the Green Procurement Standards Guide (first edition)

2005

June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September Participated in Team Minus 6%, a national movement to prevent global warming

2008

2009

2016

May Acquired a certificate of a low-carbon building as Japan’s first residential complex in which all units have ECO ONE and floor heating
June Environment Month events: Issued new environmental cards to all Rinnai employees Organized an exchange event (visit) witha corporate environmental pioneer
July Participated in COOL CHOICE campaign, a new national movement to global climatic changes and reducing greenhouse effect gas
August Won Good Packaging Prize at Japan Packaging Contest 2014 for a bottom tray with parts box for important attachments
September Held the seventh Rinnai Group Environmental Awards ceremony
December Won Nagoya Municipal Industrial Research Institute Director’s Award (for improvements targeting paper use along the supply
chain) at 21st Resource Recycling Monozukuri Symposium IMS

2017

January Presented a talk on Rinnai’s environmental activities at the 20th Dialogue and Exchange Event hosted by EPOC
Won the Energy Center Director’s Award at the Energy Conservation Awards for third-generation ECO ONE hybrid water andspace heating system
March Conducted inspections regarding conversion to ISO 14001:2015 standards
June Environment Month events:
Organized action to eradicate a specified invasive species (Coreopsis lanceolata)
Organized an exchange event (visit) with a corporate environmental pioneer
3,922 Rinnai employees participated in the My Action Declaration’s five actions to protect
biodiversity backed by the Japan Committee for the United Nations Decade on Biodiversity (UNDB-J)
November Rinnai Kansai branch office received Eco-Drive Excellent activity certificate in the general division of the 2017 Eco-drive Activity
Concours, sponsored by the Foundation for Promoting Personal Mobility and Eco-Drive Ecological Transportation

2018

January Held the eighth Rinnai Group Environmental Awards during our New Year’s celebration
February Won first prize in the Aichi Environmental Awards for our development of the ECO ONE, which is an extremely energy-efficientwater heater and heating system that cleverly and optimally uses diverse energy
April Published fourth edition of our Green Procurement Standards Guide
June Environment Month events:
Removed Coreopsis lanceolata coreopsis plants, an invasive species, and held an Environmentally Progressive Company
Inspection Council (exchange meeting)
September Exterminated the specified invasive species Coreopsis lanceolata
December Held internal study groups on ESG and the SDGs (invited outside lecturers)
Participated in the EcoPro 2018 exhibition

2019

January 9th Rinnai Group Environmental Award Ceremony held during the New Year's ceremony
February Received the “Minister of the Environment Award,” the top award at the COOL CHOICE LEADERS AWARD 2018 sponsoredby the Ministry of the Environment (development of ECO ONE)
Received the “Excellence Award” at the 22nd Environmental Communication Awards sponsored by the Ministry of theEnvironment (CSR Report 2018)
May Received the “Excellence Award” from the Ministry of the Environment(Medium-term management plan G-shift 2020 “Development of human resources to promote environmental management
and contribution”)
Ranked 26th overall at the 22nd Environmental Management Ranking hosted by The Nikkei, which evaluates theenvironmental management level of Japanese companies
June Monthly environmental events
・Held environmentally advanced company exchange meetings (inspection meetings)
・Exterminated the specified invasive species Coreopsis lanceolata
September Received “Honorable Mention” at the 2nd EcoPro Awards sponsored by the Industrial Environment Management Associationof Japan (for the development of “optimal hot water supply and heating systems” according to energy and environmental
conditions in each country and region)
November Received an Award at the Biodiversity Action Awards 2019 (Let’s grow heirloom vegetables together) organized by the Japan
Committee for the United Nations Decade on Biodiversity (UNDB-J)
December Participated in the EcoPro 2019 exhibition

2020

January 10th Rinnai Group Environmental Award Ceremony held during the New-Year Convention
May Received the “Excellence Award” in the Ministry of the Environment’s 2019 Environmental Persons Development Awards
June Environment Month events: Exterminated the specified invasive species Coreopsis lanceolata
July Selected as “Good Practice” at the Aichi-Nagoya Biodiversity Best PracticeJune Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
October Won Electric Equipment Packaging Category Award in the Good Packaging division at Japan Packaging Contest 2006
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September 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 the Good Packaging division at Japan Packaging Contest 2008 forgas fan heater
February Market debut: Eco-Jozu hot-water/heating unit RVD-E Series
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer

2010

January Market debut: Eco-Jozu water heater with bath-filling systems RUF-E Series Participated in Challenge 25 campaign, a national
movement to prevent global warming
February Won Silver Award at Aichi Environmental Award 2010 sponsored by Aichi Prefecture for global promotion of high-efficiency
combustion appliances and systems, including latent heat recovery water heaters
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September Held the first Rinnai Group Environmental Awards ceremony

2011

April Market debut: Eco One hybrid water heater with heating systems for colder regions
May Won Technology Grand Award from Japan Gas Association for development of gas hot-water system SOLAMO to use solar heat
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September Held the second Rinnai Group Environmental Awards ceremony
December Won the Resource Recycling Manufacturing Research Group Chairman’s Award at the IMS 16th Resource Recycling
Manufacturing Symposium for energy-saving measures concerning enamel combustion furnaces

2012

June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September Held the third Rinnai Group Environmental Awards ceremony
October Won Large and Heavy Good Packaging Prize at Japan Packaging Contest 2012 for Eco One hybrid water heater with heating
systems
December Won the Resource Recycling Manufacturing Research Group Chairman’s Award at the IMS 17th Resource Recycling
Manufacturing Symposium for our development of a home-use hybrid water heater with heating systems

2013

April Market debut: Eco One third-generation hybrid water heater with heating systems
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September Held the sixth Rinnai Group Environmental Awards ceremony

February Won Minister of Economy, Trade and Industry Award for condensing water heater at Ministry's 10th Energy Conservation Awards
May Drafted Rinnai Environmental Action Principles
June Environment Month event: Talk given at Rinnai by a corporate environmental pioneer
August Published inaugural issue of Environmental Report

2002

2007

2015

March Won special prize at 2nd Eco-Design Awards for tabletop cooking stove
June Market debut: Absorption-type gas air conditioner (non-CFC)
October Acquired ISO 14001 certification at Oguchi Factory
December Won prize at 8th Energy Conservation Vanguard 21 for tabletop oven RSBN-096

June Environment Month event: Talk given at Rinnai by a corporate environmental pioneer

2006

2014

January Won top energy conservation award at METI Award in the fiscal 2013 Energy Conservation Awards for Eco One hybrid water
heater with heating systems
June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
August Won Large and Heavy Good Packaging Prize at Japan Packaging Contest 2014 for returnable package
September Held the fifth Rinnai Group Environmental Awards ceremony
December Won 2014 Energy Saving and New Energy Grand Prize in Kitaguni (northern area in Japan) for Eco One hybrid water heaterwith heating systems for the Hokkaido region
Won the Chunichi Shimbun Award at the IMS 19th Resource Recycling Manufacturing Symposium for our development of an
eco-friendly water heater with bath-filling systems

July Market debut: Low-NOx burner built-in water heater (NOx at less than 60 ppm)
March Won top prize at 1st Eco-Design Awards, sponsored by Tokyo Gas, Osaka Gas and Toho Gas for water heater, fan heater andsmall hot-water heater

2001

2003

115

March Drafted Environmental Preservation Action Plan; established Environment Committee
December Won prize at 4th Energy Conservation Vanguard 21 for gas-blast type high-heat griller RGM-4, 6, 8

June Environment Month event: Organized an exchange event (visit) with a corporate environmental pioneer
September Held the fourth Rinnai Group Environmental Awards ceremony
December Won the Chairman Award of Nagoya Industries Promotion Corporation at the IMS 18th Resource Recycling Manufacturing
Symposium for improvement of logistic efficiency and reduction of waste disposal by reviewing of packing production process

Rinnai Report 2020 116

Certification Acquisition Status

Data by Site (Fiscal 2020 Results)✓ CO2 emissions

Environmental Management System International Standard [ISO 14001:2015]
Location

Rinnai

Domestic Group companies

Overseas Group companies

Certified Year/Month

Site nameLocation✓

Scope 1
(tCO2e)Scope 2
(tCO2e)Energy use(GJ)

Amount of waste
generated(Including valuables)(Thousands of tons)*1

Amount of waste
into landfill(Thousands of tons)

Amount ofrecycled waste(Thousands of tons)

Oguchi Factory

Oguchi-cho, Niwa-gun, Aichi

1,873

2,220

54,698

4.9

4.9

0.0

Seto Factory

Seto-shi, Aichi

1,596

3,714

63,000

2.3

2.3

0.0

October 1997

Akatsuki Factory

Seto-shi, Aichi

721

1,546

26,537

1.2

1.1

0.046

Seto Factory

December 2000

Technology Development Center

Oguchi-cho, Niwa-gun, Aichi

2,347

2,685

67,835

0.1

0.1

0.0

Environment DivisionDecember 2000

Head Office and Sales Offices

2,233

76,293

0.7

0.6

0.009

November 2003

—

3,643

Quality Assurance Headquarters
Head Office

December 2008

Yanagisawa Manufacturing Co., Ltd. Kadoma-shi, Osaka

634

665

18,288

0.4

0.4

0.0

Chube Branch

December 2008

Rinnai Technica Co., Ltd.

Kakegawa-shi, Shizuoka

1,388

1,369

34,271

1.2

1.2

0.006

Kansai Branch

May 2010

Gastar Co., Ltd.

Yamato-shi, Kanagawa

1,473

1,370

40,617

0.5

0.5

0.001

Logistic Control Office

May 2010

RB Controls Co., Ltd.

Kanazawa-shi, Ishikawa

1,007

3,142

38,043

0.4

0.4

0.021

Kanto Branch

May 2011

Rinnai Precision Co., Ltd.

Komaki-shi, Aichi

3,581

6,866

124,712

2.3

2.2

0.006

Chugoku Sales Office

May 2011

Rinnai Parts CenterMay 2011

RT Engineering Co., Ltd.

Toyoda-shi, Aichi

310

1,260

16,050

0.2

0.2

0.002

Kyushu Branch

April 2012

Japan Ceramics Co., Ltd.

Kani-shi, Gifu

1,427

1,011

32,114

0.2

0.2

0.021

Hokkaido Sales Office

April 2012

Noto Tech Co., Ltd.

1,501

1,290

34,866

1.8

1.5

0.259

Niigata Sales Office

April 2012

Nakanoto-cho, Kajimagun, Ishikawa

Tohoku Branch

May 2013

Techno Parts Co., Ltd.

Aichi

230

375

7,528

0.047

0.045

0.001

Shikoku Sales Office

May 2013

Rinnai Holdings (Pacific) Pte Ltd.

Singapore

32

22

671

—

—

—

Higashikanto Sales Office

April 2014

Rinnai Hong Kong Ltd.

Hong Kong

0

3

14

—

—

—

Kitakanto Sales Office

April 2016

Customer Division

May 2017

Guangzhou Rinnai Gas andElectric Appliance Co., Ltd.

China

49

39

898

—

—

—

Akatsuki Factory

March 2018

Rinnai Italia S.r.l.

Italy

62

18

1,117

—

—

—

Oguchi Higashi Factry

June 2018

Rinnai America Corporation*3

United States of America

639

1,416

23,355———

Minami-Kanto Branch

June 2019

Gastar Co., Ltd.

October 2001

Rinnai Australia Pty., Ltd.

Australia

2,287

6,529

61,949

—

—

—

China

2,403

9,751

91,042———

Research & Development Headquarters

October 1997

Production Engineering Division

October 1997

Oguchi Factory*2*4

Rinnai Technica Co., Ltd.

December 2003

Shanghai Rinnai Co., Ltd.

Yanagisawa Manufacturing Co., Ltd.

June 2004

Rinnai Korea Corporation

South Korea

2,327

4,874

87,165———Rinnai Precision Co., Ltd.

December 2005

P.T. Rinnai Indonesia

Indonesia

4,203

9,332

120,760———

Japan Ceramics Co., Ltd.

January 2006

Rinnai New Zealand Ltd.

New Zealand

265

94

6,270

—

—

—

RT Engineering Co., Ltd.

March 2006

RB Controls Co., Ltd.

March 2006

Rinnai Taiwan Corporation

Taiwan732

1,145

20,779———

Noto Tech Co., Ltd.

January 2007

Rinnai (Thailand) Co., Ltd.

Thailand

1,155

2,017

33,639———Rinnai Korea Corporation

July 1997

Rinnai Brasil Heating Technology Ltd. Brazil

133

58

5,341

—

—

—

RB Korea Ltd.

October 2006

Rinnai Viet Nam Co., Ltd.

Viet Nam

635

701

13,440———Shanghai Rinnai Co., Ltd.

December 2008

RB Korea Ltd.

South Korea

69

495

5,263

—

—

—

Rinnai Brasil Heating Technology Ltd.

June 2011

Rinnai New Zealand Ltd.

July 2013

Rinnai Viet Nam Co., Ltd.

June 2019*5

1. In some cases, there is a mismatch between the breakdowns and totals for the amount of waste generated, the amount of waste into landfill and the amount of recycled waste (Unit:
Thousands of tons).
2. Includes the Head Office, nationwide sales offices, logistics centers and the Rinnai Parts Center.
3. Includes Rinnai Canada Holdings Ltd.
4. Includes Gas Appliance Services Corporation.
5. Includes Shanghai Rinnai Thermo Energy Engineering Co., Ltd.

Environmental Management System “Eco Action21”
Location
Domestic Group
companies

117

Techno Parts Co., Ltd.

Certified Year/Month
August 2011

Rinnai Report 2020 118

Water Discharge (Fiscal 2020 Results)
Site
Oguchi Factory

Seto Factory

Akatsuki Factory

Yanagisawa
Manufacturing Co., Ltd.

Rinnai Technica Co., Ltd.

Gastar Co., Ltd., Head
Office and Factories

Gastar Co., Ltd.,
Research Building

Water discharge
standard(Water discharge to)
Sewer

River
(Yatoko River)River(Kazunari River)

Sewer

River
(Ota River)

Sewer

River
(Sakai River)

Rinnai Precision Co., Ltd.,
Head Office and Komaki
Factory

Sewer

Rinnai Precision Co., Ltd.,
Kani FactoryRiver(Kani River)

RT Engineering Co., Ltd.

Japan Ceramics Co., Ltd.

Noto Tech Co., Ltd.

Sewer

River
(Kani River)River(Nagaso River)

Substance*1

PRTR*3 (Fiscal 2020 Results)
Regulation value

Voluntary

Actual value(Maximum)

pH
BOD
COD
SS
pH
BOD
COD
SS
pH
BOD
COD
SS

5.7~8.7300—
300
5.8~8.6
25 (20)25 (20)30 (20)5.8~8.620
20
20

5.8~8.7240—240
6.0~8.420
20
20
5.8~8.6
16
16
16

7.8
110
—
63
7.5
7.2
5.7
4
7.7
4
9.6
2

pH

5.0~9.0

5.9~8.5

8.8

BOD
COD
SS
pH
BOD
COD
SS
pH
BOD
COD
SS
pH
BOD
COD
SS
pH
BOD
COD
SS
pH
BOD
COD
SS

600
—
600
5.8~8.6
25 (20)160 (120)
50 (40)5.0~9.0600——
5.8~8.615
2540
5.8~8.6300—
300
5.8~8.6
15
—
30

300
—
300
6.3~8.1
20 (15)20 (15)30 (20)5.2~8.8480——
6.0~8.41220
32
6.0~8.4300—
300
5.8~8.6
15
—
30

16
—
56
7.7
15
18
7
8
25
—
—
8.1
5
5
5
7.3
250
—
5
6.6
4
—
2

pH
BOD
COD
SS
pH
BOD
COD
SS
pH
BOD
COD
SS

5.7~8.7300—
300
5.8~8.6
15
160 (120)
30 (25)5.8~8.2
40 (30)160 (120)
40 (30)5.7~8.0150—
150
5.8~8.6153030
6.0~8.2
36 (27)140 (100)
36 (27)

Amount of emission/discharge
Site

Oguchi Factory

Seto FactoryClass I designated chemical Handling
substance nameamountAir

53

Ethylbenzene

1,700

1,100

0

Number

7.7
5.3
—
9
7.3
8.6
6.1
8
7.5
18
25
3

Landfill

Sewers

Outsidetherelevant
office

0

0

0

460

Soil

80

Xylene

4,200

2,700

0

0

0

0

1,200

300

Toluene

2,200

1,400

0

0

0

0

610

309

Nickel compounds

1,200

0

0

0

0

0

120

405

Boron compounds

3,200

0

0

0

0

0

350

53

Ethylbenzene

1,500

1,100

0

0

0

0

370

80

Xylene

2,000

1,700

0

0

0

0

370

87

Chromium and chromium (III)compounds

20,000

0

0

0

0

0

0

300

Toluene

1,100

21

0

0

0

0

1,100

308

Nickel

36,000

0

0

0

0

0

0

53

Ethylbenzene

1,800

1,600

0

0

0

0

200

*2

Akatsuki Factory

PublicwatersAmount of transfer

80

Xylene

4,200

4,000

0

0

0

0

200

296

1,2,4-trimethylbenzene

1,100

1,000

0

0

0

0

20

300

Toluene

2,200

590

0

0

0

0

1,600

31

Antimony and its
compounds

2,100

0

0

0

0

0

210

265

Tetrahydromethylphthalicanhydride

12,000

0

0

0

0

0

0

448

Methylenebis (4,1-phenylene)
diisocyanate

1,300

0

0

0

0

0

0

460

Tritolyl phosphate

2,400

0

0

0

0

0

270

448

Methylenebis (4,1-phenylene)
diisocyanate

36,000

0

0

0

0

0

0

460

Tritolyl phosphate

49,000

0

0

0

0

0

5,400

RT Engineering Co., Ltd.

308

Nickel

1,000

1,000

0

0

0

0

0

Japan Ceramics Co., Ltd.

53

Ethylbenzene

1,400

1,200

0

0

0

0

0.1

80

Xylene

2,000

1,700

0

0

0

0

1.3

300

Toluene

8,400

8,400

0

0

0

0

0.2

412

Tritolyl phosphate

1,200

0

0

0

0

0

570

31

Antimony and its
compounds

10,000

0

0

0

0

0

0

309

Nickel compounds

910

0

3

0

0

0

250

405

Boron compounds

6,900

0

120

0

0

0

820

RB Controls Co., Ltd.;
Kanaiwa Factory

RB Controls Co., Ltd.;
Tsurugi Factory

Noto Tech Co., Ltd.

*3 Class I designated chemical substance stipulated by the Pollutant Release and Transfer Register (PRTR) Law (Unit: kg), Two significant digits*1. pH: Concentration of hydrogen ions, BOD: Biochemical oxygen demand (mg/l), COD: Chemical oxygen demand (mg/l), SS: Concentration of aqueous suspended solids (mg/l),( ) Daily average*2. As a result of water quality inspections of wastewater, values exceeding the voluntary standard value was detected in BOD at Rinnai Technica Co., Ltd.
While identifying the source together with the measuring company, the maintenance cycle of the septic tank was revised with the intention of replacing the equipment renewal andimprovements such as processing control optimization were implemented because the processing capacity of the septic tank was assumed to be insufficient. Water quality
results after these measures show no problems in terms of maintaining the voluntary standards.

119

Rinnai Report 2020 120

Emissions into the Air (Fiscal 2020 Results)
Regulation value

Voluntary

Actual value(Maximum)Combustion furnace Soot and dust

0.25

0.16

0.001

NOx emissions

180

150

62

Soot and dust

0.1

0.08

0.002

NOx emissions

150

96

56

Soot and dust

0.1

0.05

0.002

NOx emissions

150

79

23

Combustion furnace Soot and dust

0.2

0.15

0.003

NOx emissions

230

200

2

Soot and dust

0.1

0.1

0.002

NOx emissions

150

150

24

Combustion furnace Soot and dust

0.1

0.1

0.002

BoilerSoot and dust

0.1

0.08

0.0012NOx emissions

150

120

27

Combustion furnace Soot and dust

0.125

0.125

0.004

NOx emissions

90

90

16

SOx

0.25

0.25

0.01

Site

Facility

Oguchi Factory

BoilerSeto Factory

BoilerAkatsuki Factory

Yanagisawa Manufacturing Co., Ltd. Boiler

Gaster Co., Ltd.

Japan Ceramics Co., Ltd.

Substance*1

Scope 2CO2 conversion factors
Domestic emission factors: “Emission Factors by Electricity Utility (for FY2020 Reporting)” in MOE/METI, GHG Emission
Calculation and Reporting Manual (Ver. 4.6)
Overseas emission factors: Latest figures published for electricity utilities, etc., in the countries concerned
Australia

Electricity

0.6700 ~ 1.2000

tCO2e/MWh

New Zealand

0.1940tCO2e/MWh

United States

0.3538 ~ 0.4820

tCO2e/MWhHong Kong

0.8100tCO2e/MWhTaiwan0.5448tCO2e/MWh

South Korea

0.4240tCO2e/MWhIndonesia

0.8770tCO2e/MWhThailand

0.5050tCO2e/MWh0.8046 ~ 0.8367

tCO2e/MWhBrazil

0.0750tCO2e/MWh

Singapore

0.41880tCO2e/MWhViet Nam

0.9130tCO2e/MWhItaly0.4455tCO2e/MWhChina (Shanghai)*1 Soot and dust: g/m3N, NOx: ppm, SOx: m3N/h

Conditions for Calculations
Scope 1CO2 conversion factors
Emission factor: MOE/METI, GHG Emission Calculation and Reporting Manual (Ver. 4.6)
Heating value: • City gas: 45 MJ/Nm3
		• Methane gas: 39.7 MJ/m3

Gas

Oil

121

Town gas

2.24

tCO2e/1,000 Nm3

Methane2.02

tCO2e/1,000 Nm3

LPG

3.00

tCO2e/tButane3.00

tCO2e/tHeavy oil

2.71

tCO2e/kl

Kerosene

2.49

tCO2e/kl

Light oil

2.58

tCO2e/kl

Gasoline

2.32

tCO2e/kl

Scope 3
• Calculated in accordance with MOE/METI, Basic Guidelines on Calculation of Greenhouse Gas Emissions Throughout
the Supply Chain (Ver. 2.3)
• Conditions for all categories• Emission factors: MOE, Emission Factor Database (Ver. 3.0)
Sustainable Management Promotion Organization’s LCI database IDEAv2 (for calculating GHG emissions in the supply
chain)• Conditions for category 11 (Use of sold products)• Products covered: Water heaters sold by Rinnai• Period: 10 years• Conditions: Conditions defined by Rinnai• Emission factors:• Electricity: 0.570 kgCO2e/kWh• Federation of Electric Power Companies of Japan, Environmental Action Plans in the Electricity Industry,• September 2015 (reference materials: collected data on performance in fiscal 2014)• City gas: 2.21 kgCO2e/m3• Tokyo Gas Co., Ltd., City Gas CO2 Emission Factors (13A, 45 MJ/m3, ordinary households and other customers
receiving low-pressure supply)

Rinnai Report 2020 122

Third-Party Assurance Statement

123

Rinnai Report 2020 124

External Acclaim and Recognition

International Recognition for CSR Efforts

Certified by the City of Nagoya as a “Company Promoting Women’s Activities”

Rinnai was selected for inclusion in the FTSE4Good Index Series and theFTSE Blossom Japan Index, the leading environmental, social andgovernance (ESG) investment indices.

Rinnai was certified as a “company promoting women’s activities,” as part of a scheme
operated by the City of Nagoya (Aichi Prefecture) in fiscal 2014.
We have been certified in recognition of three key initiatives aimed at expanding
frameworks, assigning duties, and changing attitudes, to support female employees sothat they play a greater role in the workplace.

Rinnai was selected for inclusion in the “Sompo Sustainability Index” launched by
SOMPO Asset Management Co., Ltd.

Registered by Aichi Prefectural Government as a “Family Friendly Company”“Honorable Mention” at the 2nd EcoPro Awards

In March 2014, Rinnai was registered by the Aichi prefectural government as a “family friendly
company,” based on its commitment to ensuring that employees strike a balance between theirwork and private lives.

Rinnai received “Honorable Mention” at the 2nd EcoPro Awards
sponsored by the Industrial Environment Management Associationof Japan (for the development of “optimal hot water supply andheating systems” according to energy and environmental conditions
in each country and region).
Rinnai’s booth at the EcoPro exhibition

Received “Excellence Award” at the Environment-Friendly Human Resource Company
Awards 2019
For the second time in two consecutive years, Rinnai received the“Excellence Award” (large enterprise category) at the EnvironmentFriendly Human Resource Company Awards 2019 (sponsored by
the Ministry of the Environment and the Environmental Consortium
for Leadership Development [EcoLeaD]).

Received Japan Child Care Grand Advocate Grand Prize 2020

Internal commendation system(Ceremony at Rinnai Group
Environmental Awards)

The Kanta-Kun gas clothes dryer was selected for the Japan Child
Care Grand Advocate Grand Prize 2020 (jointly named with the
Osaka Gas Co., Ltd.) by the Japan Child Care Support Association.

Certified as a “General Business Owner Meeting Standards”
In May 2014, Rinnai was certified by the Aichi Labour Bureau of the Ministry of Health, Labourand 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.

Certified as a “Parent-Friendly Company”
In fiscal 2016, we were recognized as a parent-friendly company under Nagoya’s parentfriendly company accreditation scheme. The purpose of such schemes is to certify orrecognize companies that are working to create parent-friendly environments.

Gas clothes dryer Kanta-Kun

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Rinnai Report 2020 126

2020.10