Rinnai Report 2022 (Integrated Report)Corporate Message

Aiming for the Realization of Healthy
and Comfortable Lifestyles andSustainable 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 19
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 202202

Corporate Mission and Vision

Rinnai Report 2022 (Integrated Report)

Fundamental Concept

Quality is our destiny

Editorial Policy
Rinnai produced the Rinnal Report 2022 (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

01

Corporate Message

03

Corporate Mission and Vision05

100 Years of History

09

Rinnai Group Profile

11

Value Creation Process

13

Message from the President

19

Medium-term Business Plans

23

Message from the General Manager of
the Overseas Business Headquarters

25

Message from the President of an Overseas Subsidiary27

Identifying Material Issues

Editorial Policy/Contents

Rinnai Report 2022 (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

Abridged version
booklet form

Contents

Scope

Environment
29

Rinnai Group’s Path to Becoming Carbon-Neutral

31

Responses to the Task Force on Climate-related Financial
Disclosures

33

Global Deployment of Rinnai Group Water Heaters

35

Environmental Impact within Rinnai’s Value Chain

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

SocialReporting Period
This report focuses on events that occurred in fiscal 2022—April 1, 2021, to
March 31, 2022—but also touches upon measures implemented and recent
activities undertaken since fiscal 2022 as well as future business direction,
targets, and plans.

Schematic Diagram of Company Ideals

Spiritual support of Rinnai
Company
Motto

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

Publication Schedule
Brand Promise—Rinnai’s Corporate Mission—

Expectations and attractiveness that
we keep promising with our customers

August 2022 (Japanese version)
Previous: August 2021, Next: August 2023 (planned)

Important Points Regarding Future Outlook
Rinnai Code of Conduct

03

Specific rules of day-to-day corporate activities

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

37

Links between Corporate Strategy and the Realization ofa Sustainable Society (SDGs)

45

Human Capital
Increasing Employee Engagement/Health Management Initiatives

46

Industrial Relations and Human Rights

47

Fair and Diversified Employment

48

Occupational Health and Safety

Governance
49

Management Structure

51

Leadership

53

Message from an Outside Director

54

Compliance/Risk Management

55

Data Collection
Eleven-Year Financial Summary,
Human Resource- and Personnel-Related Data,
Environmental Data

Rinnai Report 202204

100 Years of History (Part 1) 1920–2004

Historical Overview

Phase 1

Phase 2Phase 3Phase 4Phase 5

Founding and Postwar Reconstruction

Establishing a Corporate Foundation

Promoting Business Activities Overseas

Becoming a Listed Company

Advancing as a Global Corporation[1920–1949][1950–1965][1966–1978][1979–1987][1988–2004]

Childhood friends Hidejiro Naito and Kanekichi Hayashi
were inspired by the blue flame of an oil stove outside a shop
selling Imagawa-yaki (sweet stuffed pancakes) and decided
to start a business. Taking a character from each of theirsurnames, they named it Rinnai & Co., launching thedevelopment and commercialization of oil and gas stovesand oil heaters.
After the start of the Sino-Japanese war, the market
for oil and gas stoves was suspended due to oil
consumption regulations that prioritized military use, thus
the Company survived by manufacturing parts for aircraftand other equipment. After the war ended, they relaunchedtheir business with the manufacture of industrial andagricultural equipment, and in 1949, they resumed
production of gas and oil stoves as originally intended.

In 1950, the Company was relaunched as acorporation with the establishment of Rinnai
Seisakusho. During the 1950s, sales offices wereopened in Tokyo, Osaka, Fukuoka and other urban
areas, creating a nationwide sales network.
A major turning point came when theyencountered Dr. Schwank, developer of the gas
infrared ceramic burner. The first major hit productwas a gas infrared stove using burners manufactured
by Schwank GmbH based on a technology tie-up
between the two companies. In the early 1960s, theInba Factory (later the Asahi Factory) and Oguchi
Factory were constructed in response to the strong
demand for these stoves.

The Company, which commemorated its 50th
anniversary in 1970, changed its name to its current
form, Rinnai Corporation, the following year.
A Technology Center was also constructed anda development division was launched toundertake product development, establishinga development-oriented company structure.
Overseas development began with theestablishment of Rinnai International in Ohio, USA(1967), expanding to Taiwan, Australia, Malaysia, South
Korea, New Zealand, Brazil, the United Kingdom anda variety of other locations, where local offices andsubsidiaries were established in an effort to improvethe culture of everyday life in those areas.

In 1979, the Company was listed on the Second Sectionof the Nagoya Stock Exchange, and in 1983, it was listedon the First Section of both the Tokyo Stock Exchange
and the Nagoya Stock Exchange. Around the same time,
the Company made progress in terms of quality costdelivery (QCD), aiming to develop molds and other criticalcomponents that up to that time had been outsourced.
In developing new technologies and products, theCompany brought new products to market meeting userneeds, including the Yukko compact gas water heater(1982) and the push-button gas tabletop cooker (1984).
Focusing efforts on enhancing its customer service
system, in 1986 the Company launched telephone
support available 24 hours a day, 365 days a year.

In fiscal 1989, for the first time the Company achieved its
long-sought after sales target of ¥100 billion, and incommemoration of its 70th anniversary a year later, plans
were made to construct a new Head Office building thatwas completed in 1994.
In terms of products, the Company promoted
added value through safety functions that included gas
water heaters equipped with carbon monoxide sensors
and hobs (stovetops) equipped with a tempura oil fire
prevention function. In response to the rapid developmentof China and ASEAN countries, the Company establishedjoint manufacturing bases and acquired quality andenvironmental management certifications, including ISO
9000 and 14000 series in promotion of initiatives
undertaken as a global corporation.

2005¥202.0 billion

1989

Performance¥98.4 billion

1980¥48.3 billion

Net sales
1967¥5.6 billion

1951

Rinnai & Co. founded.
1921

Technologies andProducts

1951–●1920 The Rinnai-type kerosene gas stove registeredas a utility model is launched.
●1923 Gas tabletop stove, gas ranges, gas oven, gas
water heater and other product deliveries to gas
companies across Japan as overseas exports
begin.
●1937 Sales of oil and gas stoves across north China
market from base in Tianjin City are launched.

Rinnai-type kerosene gas stove

Management andOrganization

05¥21 million●1920 The company is incorporated as Rinnai & Co. byfounders Hidejiro Naito and Kanekichi Hayashi.
●1938 Manufacturing of aircraft parts takes place with thefactory coming under military supervision.
●1940 The company changes its name to Rinnai Aircraft
Parts Manufacturing.
●1947 Production of gas and kerosene appliances resumes
at the rebuilt Head Office factory.

●1957

1967–

The company forms a technology tie-up withGerman company Schwank GmbH to
manufacture and sell gas infrared burners and todevelop heaters and cooking appliances that use
them.

●1967
●1971
●1972

Technology Development Center opens.
Development and sales of high-speed gas
convection range, Convec.
The company receives the Ota Award fromthe Japan Gas Association for its high-speed
gas convection range, Convec.

Schwank gas infrared
heater produced
domestically in Japanfor the first timeHigh-speed gas
convection range,
Convec●1950 The company is reorganized as a joint stockcompany and renamed Rinnai Seisakusho.
●1954 The Tokyo Sales Office (now the Kanto Branch) opens.
●1956 The Osaka Sales Office (now the Kansai Branch) opens.
●1957 The Aichi Factory (now the Chubu Branch) opens.
●1960 The Inba Factory (later the Asahi Factory) opens.
●1961 The Fukuoka Sales Office (now the Kyushu
Branch) opens.
●1963 The Sendai Satellite Office (now the Tohoku
Branch) opens.
●1963 The Sapporo Satellite Office (now the Hokkaido
Sales Office) opens.

●1968 The Niigata Satellite Office (now the Niigata Sales
Office) opens.
●1969 The Nagoya Sales Office (now the Chubu Branch)opens.
●1970 Rinnai Taiwan Corporation is established.
●1970 Business partnership with Yanagisawa
Manufacturing Co., Ltd.
●1970 Investment in Yamauchi Yoko (now RT Engineering Co., Ltd.)●1971 The name changes to Rinnai Corporation.
●1971 RB Controls Co., Ltd. is established.
●1971 Rinnai Australia Pty. Ltd. is established.
●1973 Rinnai (Malaysia) Sdn. Bhd. is established.

1980–

1989–

●1980 Full-scale production of built-in equipment begins.
●1983 A gas instantaneous water heater, UT, equippedwith a safety mechanism to prevent incomplete
combustion launches.
●1985 The company receives the Ota Award from theJapan Gas Association for development of awater boiler equipped with a safety mechanism toprevent incomplete combustion.
●1986 The company receives the Excellent Technology
Prize from the Japan Gas Association as well as
the first Chunichi Industrial
Technology Award for thedevelopment of an ultracompact
water heater, Yukko.

●1990 The Tsukuba Research Center (now Tsukuba
Training Center) opens.
●1998 Gas fan heater and air purifier are combined together.
●1999 A highly efficient condensing gas water heater
is launched.
●2000 The company receives the Ministry of international
Trade and Industry’s Energy Conservation Award for
its highly efficient condensing gas water heater.
●2003 The company receives the Energy Conservation
Grand Prize (Chairman’s Prize) from the Energy
Conservation Center for its glass-top stoves with
inner flame burners.

The company is listed on the Second
Section of the Nagoya Stock Exchange.
●1979 Rinnai Precision Co., Ltd. is established.
●1979 The Seto Factory opens.
●1981 Japan Ceramics Co., Ltd. is established.
●1981 Business partnership with Isomura Kiki (now Rinnai
Technica Co., Ltd.)●1983 The Hiroshima Sales Office (now the Chugoku
Branch) opens.
●1983 The company is listed on the First Section of theTokyo Stock Exchange and the Nagoya Stock
Exchange.

(FY)

Highly efficient condensing
gas water heater

Gas instantaneous water heater, UT
●1979

2005

●1988
●1988
●1990
●1990
●1991
●1993
●1994
●1995
●1996
●1997

P.T. Indonesia is established.
The Hong Kong Representative Office opens.
Rinnai (Thailand) Co., Ltd. is established.
Noto Tech Co., Ltd. is established.
Rinnai Singapore Pte. Ltd. is established.
Shanghai Rinnai Co., Ltd. is established.
The new Headquarters building is completed.
The company receives ISO9001 certification for all domestic factories.
Rinnai Holdings (Pacific) Pte. Ltd. is established in Singapore.
Technology Division acquires ISO14001 certification(sequentially acquired thereafter).
●2004 Guangzhou Rinnai Co., Ltd. is established.

Rinnai Report 2022

06Medium-term Business Plans

100 Years of History (Part 2) 2005–2025
Promoting Medium-term Business Plans Under a New Structure
Phase 6

Phase 7

Phase 8Phase 9Phase 10Phase 11

V-Shift Plan

Reform & BreakthroughJump UP 2014

Evolution and Succession 2017

G-shift 2020

New ERA 2025

[2006–2008][2009–2011][2012–2014][2015–2017][2018–2020][2021–2025]

In 2005, the current President Hiroyasu Naito was
appointed. His first policy was to “focus on a highvalue-added and differentiated product strategy
centered on new technologies.” This concept wasmade into concrete measures and incorporated into
the “V-shift Plan” medium-term business plan.
With “V” representing value, the plan, simply put,
aimed to transition from quantity to quality. In line withthe policies of switching from “a focus on sales andmarket share to added value and profits” and from an“omnidirectional strategy to selection andconcentration,” the Company revised its cost structure
and attempted to realize manufacturing innovations.

Under the medium-term business plan launched in2009 entitled “Reform & Breakthrough,” theCompany aimed to become a comprehensive heat
energy appliance manufacturer contributing topeople’s lifestyles throughout the world, establishinga presence with a unique business model appealing
to both people and business partners.
While accelerating manufacturing that placed
top priority on the environment, the Company aimed
for a lean corporate structure and the thoroughelimination of wasteful business activities. At thesame time, cooperation and collaborations were
strengthened among Group companies in Japan andoverseas, sharing the same ideals in an effort topromote the consolidation of a structure as acomprehensive heat energy appliance Group.

Launched directly after the Great East Japan
Earthquake, “Jump UP 2014” aimed to establish a
corporate structure able to supply appliances
optimized from an environmental standpoint to global
markets in light of social needs for the best energy mix.
The Company stepped up its pursuit of zero
defects in response to Rinnai fans who valued thebrand for its safe and trouble-free products.
Innovations aimed at revising development,
manufacturing and sales processes enhanced
mobility. Organizational capabilities were taken to a
new level through Group coordination and strategic
human resource development in response to
globalization and increasing sophistication. Whilefocusing efforts on these initiatives, the Company
engaged in the long-term enhancement of its
corporate value.

The Company views “succession” as indispensable
for its business. With its origin in the concept “quality is
our destiny,” Rinnai’s mission is to “utilize heating toprovide society with a comfortable way of life” in all
global markets.
At the same time, with regard to “evolution,” inorder to respond to liberalization in the energy
markets, shrinking workforces and other rapidchanges in the business environment, this plantargeted business model innovations through thepromotion of product sophistication in Japan and,overseas, the smooth horizontal deployment oftechnologies and products created by Group
companies. The plan also aimed to establish the
Rinnai brand as a comprehensive heat energy
appliance manufacturer.

Focused on the 100th anniversary of Rinnai’s
founding, this plan introduced the Group slogan“innovating technologies for the next generation andstrengthening overseas growth strategies to leap
forward as a global brand.”The “G-shift” medium-term business planname represents three core policies aimed atpromoting global strategies leveraging the Group’s
network, the shift to a new generation that passes on
traditions accumulated over the past 100 years andbreaks common sense, and the establishment of acorporate governance system meeting the demandsof society and modern times. In 2019, the Company
formulated the brand promise “Creating a healthier
way of living” to further clarify its stance.

Rinnai celebrated its 100th anniversary in 2020. As a fresh start for
the next 100 years, we formulated a new Medium-Term Business
Plan covering the five-year period from fiscal 2022 to fiscal 2026.
The aim of the plan is to realize healthy, comfortable lifestyles anddeliver sustainable corporate growth.
We have positioned the year 2021 (101 years since ourfoundation) as the start of a New ERA. We will achieve Advancementin addressing social challenges through Expansion of business scaleand Revolution of corporate structure.
In anticipation of accelerated environmental changes that
include efforts to achieve carbon neutrality, the transformation ofneeds and the entrenchment of the “new normal” and digitaladvances, Rinnai aims to be the brand of choice in a new and rapidlychanging era, and positions the next five years as a period fordelivering growth and implementing reforms from a medium- tolong-term perspective.

¥366.1 billion
Domestic sales

Overseas sales¥35.8 billion

Performance

56%

New ERA 2025
New Expansion, Revolution and Advancement

Operating income
Operating margin

Management andOrganization

Technologies and Products

2006

07

2007

2008

2009

2010

2011

2012

●2005 The company receives the Technology Prize fromthe Japan Gas Association for its Eco-Jozu
condensing dual water heater/space heaters.
●2006 The company receives the Technology Prize fromthe Japan Gas Association for its bathroom
heater/dryer with mist sauna function.
●2007 Built-in hob (stovetop) DELICIA series is launched.
●2008 Dishwasher with baking soda washing mode isreleased.
●2008 Rinnai Indonesia wins Best Brand Award.
●2008 Rinnai gas tankless water heater receives the Super
Nova Star Award (an energy-saving award) fromthe Alliance to Save Energy in the United States.

●2010 The Production and Technology Development
Center opens.
●2010 Commercialization of home-use hybrid water
heaters combining heat pumps and gas water
heaters.

●2006 Shanghai Rinnai Thermo Energy Engineering Co., Ltd.
is established.
●2008 Rinnai Italia S.r.l. is established.
●2008 The Integrated Logistics Center opens.

●2009 Rinnai Canada Holdings Ltd. is established.
●2010 The Production and Technology Development
Center opens.
●2011 The West Japan Customer Center opens.
Great East Japan Earthquake service support is
implemented.

2013

2014

2015

●2014 The company receives the Ministry ofInternational Trade and Industry’s Energy
Conservation Award for ECO ONE, a hybrid
water heater with heating system.
●2014 The company’s hybrid water heater with heating
system for Hokkaido receives the Kitaguni
Energy conservation and New Energy Grand
Prize.

2016

2017

2018

●2016 DELICIA dedicated app “DELICI APP” withcooking support function distribution is launched(“+ R RECIPE” from 2020 onward).
●2017 Third-generation ECO ONE hybrid water heaterand heating system wins Energy Conservation
Grand Prize Energy Conservation Center
Chairman's Award.
●2017 High-quality and luxury kitchen appliance series
G-LINE is launched.

2019

2020

2021

●2018 Drop-in modular-type gas cooker “G:101” wins
“iF Design Award 2018.”●2020 Domino-style built-in stove G-LINE series wins
“Red Dot Design Award 2020” at the Red Dot
Design Awards.
●2020 Microbubble Bath Units are launched.

2022

2023

2024

2025

2026 (FY)●2022
Launched sales of Leggiero
waterless cooking pots
Leggiero receives the Red Dot
Design Award 2022

●2022
Successfully developed
100% hydrogen combustion
technology for residential
water heaters●2013 The Akatsuki Factory opens.
●2013 The Rinnai Parts Center opens following businessintegration.
●2014 Brivis Climate Systems Pty. Ltd. in Australia is
acquired.

●2015 The Dubai Representative Office opens.
●2016 Gastar Co., Ltd. becomesa consolidated subsidiary.

●2018 The East Japan Logistics Center opens.
●2019 Our brand promise is established andthe Rinnai logo is updated.
●2020 Information Security Management
System (ISMS) certification is acquired.
●2020 Rinnai wins the “Excellence Award” at theEnvironmental Persons Development Awards.

●2021 Rinnai America acquired Industrias MASS S.A. de C.V. (Mexico)●2021 Announced the Rinnai Group Path to Becoming Carbon-Neutral
and Rinnai Innovation Manifesto 2050 (RIM 2050)●2022 Established the ESG Committee in April

Rinnai Report 2022

08

Rinnai Group Profile● Manufacturing and sales companies

Corporate Data (As of March 31, 2022)◎ Sales companies

RinnaiWorldwide○ Other business□ Overseas representative office

Incorporated

September 1, 1920

Established

September 2, 1950

Paid-in capital(As of April 1, 2022)

SOUTH KOREA● Rinnai Korea Corporation● RB Korea Ltd.

CHINA

Rinnai UK Ltd.

◎● Mikuni RK Corporation● Shanghai Rinnai Co., Ltd.
◎ Rinnai Treading B.V.
Rinnai Italia s.r.l.

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

●Rinnai Corporation● Yanagisawa Manufacturing Co., Ltd.
Rinnai Hong Kong Ltd.
◎

Dubai
Representative
OfficeRinnai (Thailand)Co., Ltd.

●

Rinnai (Malaysia) Sdn. Bhd.

◎●

(From outside Japan): +81-52-361-8211
10,777 (consolidated), 3,605 (non-consolidated)
47 (domestic 12, overseas 35)◎◎ Shanghai Rinnai Thermo Energy Engineering Co., Ltd.

□

Telephone

Rinnai Canada Holdings Ltd.

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

◎

2-26, Fukuzumi-cho, Nakagawa-ku,
Nagoya 454-0802, Japan

Number of Group companies◎ Rinnai Plus Corp.

● Shanghai RB Controls Co., Ltd.

Head office

Number of employees● RS Korea Ltd.

¥6,484,416,754● Rinnai Technica Co., Ltd.

● Rinnai Precision Co., Ltd.
● RT Engineering Co., Ltd.

Rinnai Holdings (Pacific)
Pte Ltd.

P.T. Rinnai Indonesia

Others ¥25.6 billion

South Korea¥32.1 billion● RB Controls Co., Ltd.

●

Rinnai Manufacturing Malaysia Sdn. Bhd.

Indonesia¥13.5 billion

Rinnai America Corporation●● Gastar Co., Ltd.

●Rinnai Taiwan Corporation
Rinnai Vietnam Co., Ltd.

◎

UNITED STATES● Industrias Mass, S.A. de C.V.

Net Salesby Region
Total● Noto Tech Co., Ltd.

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

China
¥52.7 billion○ Rinnai Enterprises
●

366.1

¥

billion

INDONESIA
Rinnai Brasil Heating Technology Ltd.

AUSTRALIA●● Rinnai Australia Pty., Ltd.

Australia¥25.7 billion○ Gas Appliance Services Corporation
Rinnai New Zealand Ltd.
●◎
Central Heating New Zealand Ltd.

Water Heaters and Heating Systems
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

Kitchen AppliancesHome Heaters

Tabletop cookers, built-in hobs (stovetops), ovens,dishwashers, range hoods, rice cookers, and others

Commercial-Use Equipment, Others

Fan heaters, fanned flue heaters, infrared heaters, andothersIndustrial 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)Japan¥171.5 billion

United States¥44.7 billion

Others ¥39.5 billion

Commercial-use equipment¥9.0 billion
Home heaters¥21.1 billion

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

366.1

¥

Eco Jozu, gas water
heater with bath-fillingsystem(JAPAN)09

High-efficiency gas
tankless water heater(UNITED STATES)

Drop-in gas hob(stovetop)(INDONESIA)

Fanned flue heater(UNITED STATES)

Kitchen appliances¥85.5 billion
Commercial-use gas rice cookers(JAPAN)billionWater heaters andheating systems¥211.0 billion

Rinnai Report 2022

10

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

Value Provided

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 lifestyles

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

Consolidated net sales

Creation of products
and services that are safe,
secure, andenvironmentally friendly¥366,185 million

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 2022)
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

10,777 people
84 people¥98 million¥35,864 million
Operating income ratio
9.8%
Net income attributable toowners of the parent company

0 people¥23,748 million¥8,186 million
17 companies

Net assets (equity ratio)

15 companies

ROE
ROIC
Equity ratio

Manufactured
capitalRinnai Group production bases:
25 companies(number of companies) *1
Production group staff (Rinnai non-consolidated) *1:
1,559 people
Capital expenditure (Rinnai non-consolidated):¥10,704 million

Natural capital

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

Social andrelationship capital

Rinnai brand, external evaluations, stakeholder engagement,
Rinnai Group Code of Ethics

6.9%
14.1%
66.9%

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

1,133,492 GJ
234,501 m3
551,311 m3

Safety andpeace of mind
Supporting lifestyles thatenable the prevention andavoidance of various
potential risks in the home¥378,856 million (66.9%)
Dividend per share(annual) ¥140
Products contributing to improved
quality of life
Sales

Approx. ¥99,000 million

Products that benefit the
global environment*1 As of March 31, 2022

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

Growing demand for energy-saving products
by strengthening environmental policies[Domestic] Price reduction of gas
appliances due to customer requests

Increasing needs for safety and accident
prevention as social issues[Domestic] Declining birthrates, an aging
population, and a decreasing number ofhouseholds[Overseas] Expand use of natural gas andhydrogenDecreasing working hours and intensifying
competition for securing human resources

Operating income

509 people

Financial capital

Risks

Fiscal 2022 Achievements[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

Sales

Approx. ¥140,000 million

Amount contributed toreducing CO2 emissions*5.15 million tons
Announcements of productrecalls due to defects:
0 case* Consolidated basis

11

Rinnai Report 2022

12

Message from the President

Record Sales, but Resolution of Production Delays Bearing Close Watching
Fiscal 2022, the fiscal year ended March 31, 2022, wasAs a result, net sales for fiscal 2022 were ¥366,185 million

marked by great volatility around the world as economies(up 6.3% year on year), operating income was ¥35,864

began to normalize following the contraction caused bymillion (down 11.9%), ordinary income was ¥39,060 million

the COVID-19 pandemic. The Rinnai Group continued to(down 7.9%), and net income attributable to owners of thepost impressively strong sales in the first half of the year,

parent company was ¥23,748 million (down 13.9%). Net

and to “help resolve global environmental

buoyed by a global recovery in demand. Subsequently,

sales increased for the second consecutive fiscal year,

however, new waves of the pandemic in some countries

reaching a record high, thanks to growth in overseas sales,

problems” through our products

and regions led to restrictions on economic activities whileespecially in China and the United States, and a boostat the same time geopolitical risks heightened. This

from the yen’s depreciation against major currencies,

manifested events far exceeding expectations, including

despite a decline in domestic sales due to supply chain

a tightening of parts procurement, particularly forinterruptions. However, the substantial impact of cost

semiconductors and electronic components; disruptions

increases, including those for raw material and logistics,

in overseas transportation; and soaring energy, raw

led to a fall in operating income. In fiscal 2023, we aim tomaterial and logistics costs, causing substantial

quickly resolve supply delays and achieve record-highslowdowns in production and supply chains.

levels for both sales and profits.

Achieve sustainable growth as a company ofchoice by working to “improve the quality of life”

President

13

Hiroyasu Naito

Rinnai Report 2022

14

Message from the President continued

Launching “New ERA 2025” While Responding to Changing Social Conditions
Fiscal 2022 was also the first year our new medium-termcleaning the bathroom. The DELICIA and Lisse (updated

business plan called New ERA 2025. Although it was amodel launched in September 2021) built-in gas hobs

year in which we were constantly called upon to respond(stovetops) are capable of automated cooking, so meals

to social conditions, we steadily pursued our businesscan be prepared while working from home or doing otheractivities based on the three strategies of “Expansion ofhousehold chores. These product lineups are designed

business scale,” and “Revolution of corporate structure”

to provide customers with healthy and comfortable

leading to “Advancements in addressing to social

lifestyles in line with the requirements of modern society.

challenges.” I believe it was through these initiatives that

Overseas, demand is active in China and the United

we were able to achieve a new record high in net sales.

States, which we have positioned as strategic markets in

As society shifts to the new normal brought on by

The Griffin Factory of Rinnai America

terms of “Expansion of business scale.” In the United
Rinnai America acquired Industrias MASS S.A. de

Although procurement costs will increase, we believe thisthe pandemic and becomes more conscious than everStates, the market for tankless hot-water heatersof health and work-life balance, Rinnai is contributing to(instantaneous water heaters) is expanding. Orders have

C.V. of Mexico in September 2021, and will actively

is an effective risk hedge that will help the sustainability“Improve the quality of life” with products that add value

increased significantly due to growing recognition of the

expand its business in Latin America. In China, theof our business.

to conventional functions, thereby realizing

advantages of tankless products, which had not been

impact of the zero-COVID policy has been significant,Promoting “Revolution of corporate structure”“Advancements in addressing to social challenges.”

widely accepted in the past, such as never running out ofand although the future is uncertain, it is a rare market inthrough investment in human resources is also essential

For example, the gas clothes dryer Kanta-kun not only

hot water, space saving, and being very environmentally

the world where Internet sales are particularly prominent.

to the attainment of New ERA 2025. I am proud note thatshortens housework time, but also finishes clothes withfriendly. We expect the market to continue to expand in

At Shanghai Rinnai, we are working with two local

since I assumed the position of President, Rinnai has

air heated to 80°C providing strong antibacterial

the future. To expand production capacity and improvecompanies that have strong e-commerce businesses,

been able to make significant changes throughproperties that surpass those of electric clothes dryers.

productivity, we have established a new factoryand sales have been rising steadily over the past few

continued solid management to transform the Company

The RBHM series of hot-water bathroom heaters andin Griffin, Georgia, which began full-scale production

years. Our overseas strategy is to focus on expanding

into one that can generate profits. On the other hand,dryers (launched in October 2021) can control moldin April 2022. We will aggressively promote sales

sales in growth markets, markets we have not yet

we recognized through our internal engagement survey

growth with a mist, which also reduces the burden of

in the United States to expand our market share.

entered, and emerging economies.

that a steady, sure-footed approach to management

Yet we must be vigilant over the emergence of a

was not always a good motivator for employees. This isvariety of risks as we expand the scale of our businesssomething we humbly accept and are currently

activities. Currently, in the midst of the pandemic andreviewing in terms of the education and guidance of ourrising political and military tensions, many of thepersonnel. As such, we are encouraging the revamping

aforementioned risk events are occurring, forcing usof educational programs in the departments to which

to reevaluate our past thinking and approaches.

employees belong as well as in the Human Resources

As an example, until now we have purchased parts from

Division. We will also invest intensively in the first 10 years

a single domestic supplier that could procure them mostof employment as a period of basic training. In addition to

inexpensively and efficiently, and have thus been able tolanguage skills and IT-related skills, we will ensure that all

make products while holding almost no inventory.

employees acquire specialized knowledge and skills inThis is no longer viable now and we are in the process of

the work for which they are responsible. While capital

diversifying our procurement sources. In the future,investment is an essential investment for a company, thewe will shift to production activities in which parts aresame applies to human capital, and we plan to invest

procured from multiple domestic and overseas

more money in our talent than ever before.

companies and stocked to a certain degree.
Gas clothes dryer Kanta-kun helps shorten housework time

15

Lisse series compatible with recipe apps

Rinnai Report 2022

16

Message from the President continued

Promoting Carbon Neutrality Throughout the Group

Change to Management with Leeway to Ensure Future Growth

In November 2021, the Rinnai Group announced the

Although New ERA 2025 started in an uncertain

Meanwhile, in manufacturing, we will switch toIn the 16 years since being appointed President, I

Rinnai Innovation Manifesto 2050 (commonly known as

renewable energy facilities and non-fossil fuel facilities,

environment, I am confident that we can achieve ¥450

have always strived for steady and efficient management

RIM 2050), a policy to achieve carbon neutrality by 2050.

and we also envision the introduction of green power.

billion in consolidated net sales and ¥50 billion inthat earns solid returns with minimal risk-taking to place

Rinnai believes it is its duty to improve its environmental

Rinnai will invest to achieve carbon neutrality inconsolidated operating income by the final year of thethe highest priority on securing profits. However, we must

performance and expand the use of environmentallydevelopment, manufacturing, and sales, and expects toplan. On the strengths of our diverse product lineup thatchange our mindset if we are to be a sustainable

friendly products because the products it offers generate

invest a cumulative total of more than ¥50 billion over theenriches people’s lives, we expect growth in several

company in a society where measures of the past are noan overwhelming amount of CO2 emissions during use

five years to fiscal 2026. Until now, we have focused onoverseas markets, including the United States and China,

longer effective. To ensure future growth, Rinnai isthroughout their lifecycle. We have already developed

investments that can be expected to yield a reliable

and we recognize that the global movement towardcommitted to enhancing corporate value throughand marketed Eco-Jozu, a highly energy-efficient water

return, but now that society is beginning to move toward

carbon neutrality will also be a positive. Rinnai is currently

management with the leeway to take appropriate risks.

heater, and ECO ONE, a gas-electric hybrid water heater

new values, we believe it is necessary to take on thefocusing on branding, aiming to become the brand of

We also intend to deliver to our shareholders a total

with heating systems. In recent years, our efforts havechallenge of responding to society’s needs by assuming

choice even in these rapidly changing times. I would likereturn ratio of 40% on average over the five-year period

been bolstered by growing support for suchrisks and addressing them.

to see Rinnai products be chosen from among manythrough fiscal 2026 through continued share buybacks

environmentally friendly products among customers,

As one such initiative, we established an ESG

other products as “products that make life convenientand dividend increases, which we implemented in the

major gas companies, and government agencies.

Committee and made changes to tackle these issues as

and support healthy living, even if they are a little more

first half of fiscal 2023. We look forward to your continued

Rinnai’s goal by 2030 is to sell 300,000 units of its ECO

an organization. The ESG Committee, established in

expensive.” We are continuing our efforts to promote

guidance and support.

ONE water heaters, which reduce CO2 emissions byApril 2022 and chaired by myself, will examine ESG-

understanding and instill Rinnai’s values within theapproximately 50% compared to conventional models,related measures, monitor the status of initiatives, reportCompany so that all employees can aim to create suchand we feel that we are well on track toward achieving

and make proposals at meetings of the Board of

products.

this goal. In overseas markets, the Rinnai Group will also

Directors and other meetings, and promote ESG

focus on sales of tankless hot-water units with highactivities throughout the Group. In addition, thethermal efficiency in the United States, shifting away from

Environment Division was realigned under the Corporate

the storage tank-type heaters that are not very energy

Planning Headquarters in April 2022. The latter has aefficient but that currently account for more than 90% ofsection that examines Rinnai’s medium- to long-term

the US market. We also promote carbon neutral

strategies while keeping abreast of social trends andinitiatives that match the situation in each country on ademands. By moving the Environment Division to theGroup-wide basis.

same Corporate Planning Headquarters, we believe that

Another focus is on development, and Rinnai plans
to invest a cumulative total of over ¥30 billion over thethese two departments can collaborate to steadily
promote the realization of carbon neutrality.

five years through fiscal 2026 in equipment that utilizes
hydrogen fuel and heat pump equipment. Furthermore,
major gas companies and other energy industry players
are developing methanation and propanation. These aretechnologies attracting attention for their ability toartificially produce energy feedstocks. We expect thateven if such new clean energy is commercialized, ourECO ONE X5 contributes to achieving carbon neutrality

products themselves can be produced without major
specification changes.
Development of hydrogen combustion technology announced (May 2022)

17

Conceptual model of hydrogen water heater

Rinnai Report 2022

18

Medium-term Management Plans

New Medium-term Business Plan (2021–2025)

New ERA 2025
New Expansion, Revolution and Advancement

In fiscal 2022, Rinnai launched the New ERA 2025 five-year medium-term business plan. 2021 was the 101st year since
our founding, the start of a new era in which we will achieve Advancement in addressing social challenges throughExpansion of business scale and Revolution of corporate structure.

Medium-term Business Plan New ERA 2025 Targets
Expansion of business scale

Expand regional domains
Expand business domains

Consolidate Net Sales: ¥450 billion(Japan: ¥200 billion;
overseas: ¥250 billion)

Revolution of corporate
structure
Become more consumer-oriented
Make focused investments
in intangible assets
Enhance profitability

Advancement in addressing
social challenges

Operating Income: ¥50 billion
Return on invested capital (ROIC):
19.0%
Total return ratio (five-year average):
40.0%
Sales of products that improve quality of lifeand benefit the global environment(compared with fiscal 2021):

and our own core technologies to address social
challenges in our business field “heat and lifestyles”“health and lifestyles” and achieve a sustainable,
steady, long term growth.

Key Strategies
We have formulated three key strategies: Help resolve social issues, expand business scale, and revolutionize
corporate structure.

Advancement in addressing
social challenges• Improve quality of life
• Help resolve global environmental problems

Operating income

ROIC

500

20.0％

400

300

16.0％

200

14.0％

100

7 million tons

12.0％

40.6

Contribution to CO2 emission reduction:

18.0％

366.1

344.3

50% upCorporate Vision We will utilize various kinds of energy resources

Creating a healthier way of living

Net sales(Billions of yen)

450.0

Improve quality of life
Help resolve global
environmental problems

Brand Promise

Net Sales, Operating Income, ROIC Plan (image)

35.8

50.0

0

10.0％
Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal
2021 2022 2023 2024 2025 2026

Risk Factors and Responses in Fiscal 2022
(Management of Newly Identified Risks)
In fiscal 2022, insufficient product supplies and rising costs inconvenienced many people. Rinnai will analyze
contributing factors and take resolute measures to ensure the stable delivery of products to customers.
Product Supply Delays
Component procurement difficulties

Marine transport disruptions

CausesFrom September 2021, Rinnai had difficulty procuring wire
harnesses, microcomputers and other components, with
supply delays affecting many products

Unreliable container shipping due to global increase inlogistics activities

Response

Increased product and component inventories. Diversified
procurement routes, including ordering the same components
from several different companies
Component standardization designs

Utilized multiple transportation routes, developed newtransportation routes

Expansion of business scale

Rising Product and Component Costs• Expand regional domains• Expand business domains

Rising raw material and component costs
CausesSoaring copper and steel prices. Component costs, andelectronic components in particular, also rose due to tightsupply and demand

Container prices soared due to marine transport disruptions,exacerbated by rising crude oil prices and higher marine andground freight rates

Response

Prices revised for portion unable to be absorbed throughcorporate efforts (implemented April 2022). Pursued further
cost reductions through production design revisions andimprovement activities

Created an export structure prioritizing product supply,
reduced the number of containers used through improved
loading efficiency, and established permanent local
production systems

Revolution of corporate structure• Become more consumer-oriented• Make focused investments in intangible assets• Enhance profitability

19

Rising logistics costs

Rinnai Report 2022

20

Medium-term Management Plans

New ERA 2025 Medium-term Business Plan Progress
New ERA 2025 Medium-term Business Plan
Advancement in addressing social issues

Expansion of business● Expanded lineup of products contributing to improved quality of life

● Expand business inThree Strategies Story
scale

Revolution of corporate structure● Developed 100%hydrogen combustion
technology

the Americas● Ongoing dividend increases and total return ratio improvements
150(Plan)

Dividends per Share, Consolidated Payout Ratio●

140

Rinnai Canada Holdings Ltd.
●

Rinnai America Corporation

125●

Industrias Mass

Launched sales of the Leggiero waterless cooking pot(February 2022)
Launched sales of ECO ONE X5, contributing to
the realization of carbon neutrality(June 2022)●

Rinnai Brasil
Heating
Technology Ltd.

Dividends per share (Yen)

Acquired Industrias Mass, S.A. de C.V. (Mexico),comprising the core of expansion into Latin America(September 2021).

76

Launched sales of bathroom
heaters/dryers equipped with
Mold Guard Mist
(October 2021)

carbon neutrality.
The Griffin Factory, constructed as a proprietary
manufacturing facility in the United States,
commenced mass production in April 2022.

New ERA 2025 Medium-term Business Plan
Sales of products that improve quality of life (compared with fiscal 2021)

Approx.

¥80.0 billion

Fiscal 2022 actual

Approx.

Fiscal 2026 plan

¥99.0 billion (+26%) +50%

Sales of products that benefit the global environment (compared with fiscal 2021)
Fiscal 2021 actual

Approx.

Fiscal 2022 actual

Fiscal 2026 plan

¥120.0 billion Approx. ¥140.0 billion (+17%) +50%

To realize carbon neutrality, Rinnai
successfully developed 100% hydrogen
combustion technology, and going forward,
demonstration tests will be conducted tocommercialize hydrogen water heaters.
(announced May 2022)

23.6%

29.0%

23.4%

(Plan)

23.3%

Consolidated payout ratio

Fiscal 2021 actual

2014

2015

2016

2017

2018

2019

2020

2021

2022

Operating income
billionFiscal 2026 plan

Fiscal 2021 actual

Fiscal 2022 actual

Fiscal 2026 plan¥450.0 billion¥40.6 billion¥35.8 billion¥50.0 billion

Fiscal 2021 actual

Fiscal 2022 actual

Fiscal 2026 plan

17.6%

14.1%

19.0%

Domestic
Fiscal 2021 actual

2013

KPI Achievement Progress

Fiscal 2022 actual¥344.3 billion ¥366.1

2012

In August 2021, Rinnai conducted share buybacks amounting to ¥17.4 billion.
We will continue to engage in strategic share buybacks going forward.

Consolidated net sales

ROIC
Fiscal 2022 actual¥175.8 billion ¥162.0

Fiscal 2026 planbillion¥200.0 billion

Overseas
Fiscal 2021 actual

Total return ratio
Fiscal 2022 actual¥168.4 billion ¥204.1
21

18.8%

20.0%

21.9%

15.0%

● Rinnai announced RIM 2050, its corporate policy for achieving

Launched Company-wide measures targeting the
reduction of CO2 emissions to zero by 2050
(November 2021).

98

68

15.2%

Launched sales of theLisse series, compatible
with the Rinnai recipe app(September 2021)

94

29.8%

60
19.1%

Fiscal 2021 actual

86

82

90

Fiscal 2026 planbillion¥250.0 billion

Fiscal 2021 actual−

Fiscal 2022 actual *fiscal 2022

102.7%

Fiscal 2026 plan40%

(fiscal 2021-fiscal 2026 average)

Rinnai Report 2022

22

Message from the General Manager of
the Overseas Business Headquarters
Accelerating Growth in Overseas Businessthrough Support for the Autonomous Growth ofOverseas Subsidiaries and the Development
and Execution of Medium- to Long-termGroup Strategies

Yoshihiko Takasu

Senior Executive Officer, General Manager of Overseas Business Headquarters

Robust Performance in 2021 Amid Lingering Challenges
In the Overseas Business in 2021 (January–December), sales and income growth were driven by the two major markets of theUnited States and China, where demand for daily necessities has risen sharply due to the pandemic. From the second half ofthe year, it became difficult to procure parts for semiconductors, harnesses and other products in Japan and overseas, achallenge we have yet to overcome.
In the United States, the switchover from storage tank-type water heaters to tankless water heaters (instantaneous water
heaters) is ongoing. In addition to offering low environmental impact and economic benefits, demand for renovations driven by
the movement of people into the suburbs due to the pandemic and rising prices of storage tank-type water heaters provided a
tailwind to sales. In China, online sales of water heaters were strong. While the market is mature, Rinnai products are stillrecognized as a high quality, high value-added brand generating stable sales and income. Although Rinnai performance in bothmarkets is robust, we believe it necessary to continue paying strict attention to social and economic trends, including risinginterest rates in the Unites States and the Zero-COVID policy in China.

Growth Story in Key Strategic Markets
In addition to the fast-growing North American market, the gas equipment market is expected to expand in many Central and SouthAmerican countries, which are attractive markets where Rinnai products and technologies can be utilized. Accordingly, we will also
focus efforts on business in South America, formulating strategies for North and South America as The Americas. One step in thisdirection is the acquisition of Industrias MASS S.A. de C.V., a leading manufacturer of commercial water heaters in Mexico. We expect

Deploying hydrogen water heaters, one option for achieving carbon
neutrality, in countries promoting hydrogen infrastructure

Hydrogen water heater demonstration tests launched in Australia(results announced June 2022)

Initiatives for Realizing Carbon Neutrality
To realize carbon neutrality in the Overseas Business, local subsidiaries are formulating strategies that consider decarbonization
processes in each country based on the Rinnai Group policy RIM 2050. Going forward, we must develop products that do notdepend on household appliances mainly powered by fossil fuels. This is especially critical in key regions where the Group does
substantial business, such as Australia and California (US), where electrification efforts are well underway. To this end, we willclosely monitor trends and respond appropriately. In this period of transition amid the restructuring of primary energy sources, toreduce risks and enable rapid responses, I believe the role of the Overseas Business Headquarters is to benchmark excellent
products from around the world and examine trends among partner companies. Naturally, Rinnai will remain steadfast in its
efforts to advance the development of technologies facilitating decarbonization. In May 2022, we announced the developmentof the world’s first 100% hydrogen combustion technology for residential water heaters. Demonstration tests will begin around
November 2022 in Australia, where efforts are being made to utilize hydrogen energy.

to be able to expand sales of commercial water heaters, as Industrias MASS has many distributors able to provide technical support

Focused on Maximizing Group Capabilities to Become a Company Sought by the Worldand create synergistic effects with Rinnai water heaters.
In China, an affiliate e-commerce website has commenced the opening of physical stores in regional cities. As sales are brisk, we will
focus on this area with the expectation of developing it as a new sales channel. We are also making efforts regarding the sale of kitchen
appliances, which account for about 10% of Shanghai Rinnai sales, with potential to grow much further, amid demands from e-commerce
websites to expand product lineups. In light of this, we are restructuring Shanghai Rinnai and strengthening the Kitchen Business.

In fiscal 2022, the Rinnai Group overseas sales ratio exceeded 55%, and we expect this share will continue increasing. Subsidiaries
have grown thus far through autonomous management, and going forward, we will enhance subsidiary management with the additionof Rinnai Group strategies, providing value that cannot be created by individual subsidiaries alone, while maximizing Group capabilities.
To this end, I believe a mechanism for executing strategies, the development of global human resources and visualization are critical. At
present, we are restructuring these mechanisms and the development of global human resources in a Company-wide effort to achievetargets set forth in the New ERA 2025 Medium-term Management Plan. We are also making advances in terms of visualization throughDX in an attempt to realize relevant and rapid business development. Further, we will establish a platform to share information on local
subsidiaries (management visualization), tools for sharing product information, and a trading system (logistics visualization) facilitatingsmooth logistics and risk avoidance.
Overseas business will play an extremely important role in Rinnai’s future growth, requiring us to work together as a Group andaccelerate business. Despite the challenges involved in tackling new initiatives, we will promote enhanced overseas business
operations to realize sustainable growth throughout the Rinnai Group.

New factory commences operations in anticipation of growing demand in the United States

23

Mexican water heater manufacturer acquired to expand into Central and SouthAmerica (exhibition in Mexico)

Rinnai Report 2022

24

Message from the President ofan Overseas Subsidiary
With Growth Slowing in the Chinese Market,
Rinnai Will Focus on Core Businesses and Areas
with High Potential for Development to Realize
Sustainable Growth

Hayao Nishizawa
President of Shanghai Rinnai Co., Ltd.
Display inside a physical store operated by e-commerce
website Tmall

Product display in the Shanghai Rinnai Experience Center

Robust Performance Amid an Environment of Lingering Uncertainty

Initiatives for Realizing Carbon Neutrality

In 2021, the Chinese market rebounded from the slump caused by the pandemic in the previous year, with sales exceeding one million

China has announced that it will reduce its ever-increasing carbon dioxide (CO2) emissions by 2030 and achieve carbon neutrality byunits when the export of core gas water heater products is included, resulting in total sales of more than three billion yuan and the2060, but it has not specified how this will be achieved. In China, once a government policy has been decided, everything moves in that

achievement of all-time high sales and income. 2023 will mark the 30th anniversary of our expansion to Shanghai, where from the very

direction all at once. Companies unable to respond can face massive losses, thus we must keep an eye on these trends. At present,

beginning, Rinnai garnered a reputation for high-quality products that has contributed substantially to robust online sales. In China,

Rinnai products are among the most energy-efficient and environmentally friendly products sold in China, hence we have confidence inhesitancy to make online purchases of products similar those handled by Rinnai has been declining in recent years amid the risingthat respect. In China, certain products require efficiency labeling (class 1–5) indicating energy efficiency and consumption. This

trend of inspecting actual products at mass retailers before purchasing them online through an e-commerce website.

includes gas appliances. Currently, only Class 1 products are acceptable for new construction in big cities such as Beijing, with the

Despite solid results in 2021, performance was greatly impacted in 2022 by pandemic countermeasure lockdowns in Shanghai

efficiency label becoming a guide for highly environmentally conscious consumers. While maintaining the strengths of our products, we

beginning in March and lasting approximately two months. One of the two biggest e-commerce events in China takes place in June,

will continue to closely monitor government policies and responses toward the realization of carbon neutrality from the fall of 2022

making May a critical month for manufacturers in terms of production and sales promotions. Rinnai maintained intermittent production

onward, further enhancing our product lineup.

to the extent possible during these lockdowns, but we were not sufficiently prepared. As the effects of the Chinese government’s
Zero-COVID policy remains an unavoidable risk, we will continue to closely monitor these developments.

Forward-looking Shanghai Rinnai Management Strategy
Rinnai expanded into Shanghai about 30 years ago, during which time Shanghai Rinnai has grown substantially along with the

Growth Story in the Chinese Market

expanding Chinese market. However, for the past several years, growth in the Chinese market has been flat or increased only slightly,

In the Chinese market, given the brisk online sales of water heaters, we will expand product lineups in 2022 by developing lower-cost

indicating that we cannot expect to see the same level of rapid growth going forward. Further, new market entries by companies in the

products that deliver the same performance as existing products. Up to now, it has been difficult to build sales networks throughsame industry are on the rise, and despite Rinnai’s strong business performance, the reality is we are being forced into intense

distributors in regional towns and cities. Recently, e-commerce websites have begun opening physical stores in regional towns andcompetition. Looking ahead, we cannot expect further business growth from existing businesses in China, thus we want to explore

cities. Rinnai started selling products at these stores, where sales have been extremely favorable since their launch in 2021. In regional

new businesses. Up to now, subsidiaries have engaged in autonomous management based on free-thinking. Going forward, we must

towns and cities, physical e-commerce stores are a very promising sales channel that we want to focus on going forward.

determine the ideal positioning for core businesses and the direction of the company from a long-term perspective while cooperating

We will also focus efforts on kitchen products, whichwith the Head Office’s Overseas Business Headquarters. In the future, I hope to play a role in developing the Rinnai Group by making

account for less than 10% of Shanghai Rinnai sales,

choices that can be considered good decisions for Shanghai Rinnai.

presenting an opportunity for further growth. Rinnai’s
partner e-commerce websites are also requesting weenhance our lineup of kitchen products, and in 2022, wewill develop products with expanded functions. To thisend, we restructured our organization and created theStrategic Planning Division in which a business unit wasestablished to facilitate the integration of kitchen productdevelopment, from product planning to sales promotions.
To compete against China’s top kitchen productmanufacturers, we will attempt to differentiate our
products by incorporating sensor technologies facilitating
safety and security accumulated by Rinnai over the years.

Shanghai Rinnai Co., Ltd.

25

Gas water heater

Built-in hob (stovetop)

Rinnai Report 2022

26

Identifying Material Issues

We make every effort to identify social challenges affecting the Rinnai Group through day-to-day communication

Material Issue Targets and Results

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

2022 target

5.95

Material Issues

Main Target Indicators

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 household CO2 emissions.

Target area: Global
Target stakeholders: All

Material Issues

Main Target Indicators

Consumer safety
Improving quality

Number of defects that have
led to product recall
announcements

strategies, revolving primarily around our Corporate Planning Division.

Identification Process● Conduct stakeholder questionnaire withthe aim of reviewing the Rinnai 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, MSCI, etc.)

Step 3
Analyze international
standards andguidelines

Step 4
Analyze ESG indicesand questionnaires● Analyze sustainability-related
international standards andreporting 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 key stakeholders, and material
issues● Analyze methods of reporting
activities related to social contribution

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.
○ Environmental issues

Very high<Importance to stakeholders>High
27◇ Customer issues

7.00

million tons

CO22021 results: 5.15 million tons

0

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.

cases
2021 results: 0 cases◇ Pandemic□ Communicating with suppliers○ Energy consumption○ CO2 emissions◇ Consumer safety◇ Improving quality○ Biodiversity□ Child labor/forced labor□ Support for cultural activities
and the arts

○ Conserving resources/waste○ 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
works to contribute to them. As Rinnai provides society with products that are closely related to the global environment and people’s lives, it recognizes
the importance of SDGs and will further develop its business with this focus.

The Sustainable Development Goals (SDGs)□ Other issues◇ Health◇ Housework time reduction□ Stable procurement□ Work-life balance○ Waste○ Harmful chemicals

High2025 target

Toward the achievement of a sustainable society

Determining and Identifying Material Issues

Classification of Issues

million tons

◇ Marketing communication

Very highSDGs Related to Rinnai
Goals

Contributions

Goals

Contributions

Promoting health through the hot bath effect ofbathing in microbubbles and the prevention of heatshock using bathroom heaters

Contributing to the global environment with moreenergy-efficient water heaters

Equalizing housework burdens with time-saving
products such as stoves equipped with an automatic
cooking function, clothes dryers and dishwashers

Contributing to secure lifelines during natural disasters
with hybrid water heaters

Contributing to water resource conservation withdishwashers

Implementing climate change countermeasuresthrough the spread of efficient water heaters

Rinnai Report 2022

28

Environment
Rinnai Group’s Path to Becoming Carbon-Neutral (announced November 2021)
Development of technology for 100% hydrogen combustion and development ofhydrogen equipment

Rinnai
Innovation
Manifesto 2050
Rinnai’s Roadmap through to 2050

Our products: Composition of energy used (%)

100%

Low-carbon society

Products supported by Rinnai
Carbon-free society (carbon neutrality)
Expansion of hydrogen
infrastructure

Concept model of hydrogen water heater

Hydrogen(Hydrogen combustion
appliances)Hydrogen combustion
equipment

Proliferation ofrenewable energy

Renewable energy(Hybrid and electric appliances)

Eco Jozu
Expansion of cleaner
fossil fuels

Water heater withheating system

Water heater withbath-filling system

Hybrid water
heater withheating system
Heat pumps(Electrical equipment)

Carbon-free gas(Gas appliances)

Fossil fuelsGas appliances

Continued use of existing equipment

2020

2050

Worldwide CO2 emissions: Zero by 2050

through methanation and propanation(Energy-saving equipment)

We will continue to promote the Eco Jozu high-efficiency hot-water units currently sold in Japan, move toward a lowcarbon society and respond with conventional products in line with trends in the fuel industry toward decarbonized gas(methanation and propanation).
Meanwhile, we will systemize hybrid water heaters, which are still being sold, to achieve net zero CO2 emissions,establish technologies for combustion equipment compatible with hydrogen infrastructure, and create a structure that is
in alignment with various external environments.

Rinnai has succeeded in developing 100% hydrogen combustion
technology for residential hot water heaters. Hydrogen is in demand as aclean fuel with zero CO2 emissions. The risk of explosion and unevencombustion, which had been considered problems, have been cleared andsuccessfully developed by making full use of the combustion and fluid
control technologies that Rinnai has long accumulated in the developmentof gas appliances.

We plan to conduct demonstration tests for thecommercialization of hydrogen water heaters in Australia, where
the realization of a hydrogen society is in progress. We willdevelop products and technologies in line with energy policies
and infrastructure expansion in countries around the world.
“Hydrogen House” planned for demonstration in Australia

Widespread use of high-efficiency water heaters and systems
using renewable energy sources
We aim to sell 300,000 units of
ECO ONE hybrid water heaters
annually by 2030.

Energy management systems combining solar power
generation, storage batteries, and ECO ONE willcontribute to decarbonization.
Photovoltaic
panelsECO ONE
StoragebatteryLife cycle of Rinnai products
Business activities

Percentage of
CO2 emissions

When products are used

Related to partsprocurement

Development/
production

Logistics

Product use

Final disposal process

4.8%

0.1%

0.05%

95.0%

0.03%

Main investments aimed at achieving carbon neutrality 

CO2 Emissions Targets
2020

2030

2050

2020

2030

2050

Domestic

30,000 t/CO2

15,000 t/CO2

Zero

16.8 million t/CO2

12.6 million t/CO2

Zero

Global100,000 t/CO2

50,000 t/CO2Zero

45 million t/CO2

−

Zero

(Figures of overseas products are rough estimates.)

In the life cycle of Rinnai products, approximately 95% of CO2 is emitted during product use, and Rinnai recognizes that it
must develop products that achieve low carbon and decarbonization because of their large environmental impact.
In Japan and overseas, we will promote environmental contribution activities with the goal of achieving zero CO2emissions by 2050.

29

Projected investment (5-year cumulative)

Product
development

Expansion of Innovation Center
Investment in hydrogen combustion equipment, heat pump equipment andother next-generation technologies¥30 billion or more

Manufacturing

Switch to renewable energy and non-fossil-fuel facilities
Switch to green power¥15 billion or moreECO ONE sales promotion (Japan)
Spread of energy-saving water heaters (global)¥5 billion or more

Sales

We plan to invest ¥50 billion or more in carbon neutrality over a cumulative five-year period.

Rinnai Report 2022

30

Environment

Responses to the Task Force on Climate-related
Financial Disclosures

Strategy
As a company that handles heating equipment, we understand that climate change is an important issue, and we assume
that climate change will have an impact on Rinnai’s business. We are also considering what actions are necessary toaddress the changes ahead and what the financial impact could potentially be.
ProfitImpact(Amount/
Duration)

Degree ofurgency

Convert to recyclable
materials¥(11.0)billion/
year

Small

Reduce procurement
costs throughindependent efforts¥(1.0)
billion/
year

Small

¥(0.5)
billion/5 years

Small¥(5.0)
billion/year

Medium

Impact on Rinnai

Raw material
procurement risks
associated withclimate change

Transition risks

With the aim of creating a virtuous circle of the environment and the economy which assumes a sustainable company,
Rinnai 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.

Governance
ReportLeadership
Team

Risk Management
Committee

Report

ESG Committee

ReportSharing of
ESG Matters

ISO14001

Risk of procurement cost increases
in line with raw material costs thatare passed on through carbon
pricing (carbon taxes andemissions trading) to suppliers ofmaterials that emit large amounts ofgreenhouse gases.

Risk of impending necessity ofmeasures for replacing
conventional products amid
movements toward requiring
different methods than in the past
for consumers to realize theintended use of water heaters using
fossil fuels due to the transition fromthe conventional concept of a“low-carbon society” focused onenergy and resource conservation
to the long-term concept goal of a“decarbonized society.”

Physical risks fromnatural disasters—

Risk of increased
operating costs—

Opportunities

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 according to frequency ofoccurrence and level of impact.

In 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 material issues and the “amount contributed to reducing CO2 emissions byusing the product” and “sales target for environmentally friendly products” as its main target indicators.

(Impact on Rinnai if the temperature rises
by 4°C)Gas water heater
regulations in line withfossil fuel regulations

Risk Management

Metrics and Targets(What Rinnai will do to keep the increase intemperature below 2°C)

Risk that the sale of water heaters
potentially using large amounts ofwater resources will be restricted asa result of global water shortage
problems.

Operation andEnvironment Management Management
Committee

4°C scenario*

Water heater
regulations as a resultof water resource
depletion

ESG Working

Physical risks

Rinnai reports on environmental issues tomanagement through the Risk Management
Committee, ESG Committee, andEnvironmental Management Committee.
The ESG Committee has an ESG Working
Group to handle day-to-day improvement
activities. In addition, Rinnai is promoting
initiatives related to risks and opportunities
associated with climate change andreporting to management through theoperation of ISO 14001 with the Environmental
Management Committee as the secretariat.

2°C scenario*

Adoption of energysaving water heaters
in line with tightening
environmental
regulations (CO2)

Current “low-carbon society”
initiatives require higher efficiency
energy-saving water heaters.
Additionally, the advance oftechnologies such as decarbonizedgas for realizing a “decarbonizedsociety” will require more efficientenergy-saving water heaters than in
the past.

Adoption of gas
boilers in line withtightening
environmental
regulations (PM 2.5)

In areas where coal boilers areused, gas boilers that do not
generate PM 2.5 will be required.

——

Rinnai’s response or
impact on Rinnai.

Develop water heaters
able to restrict theamount of water used.

Ascertain changing
conditions related toenergy while developing
and establishingtechnologies focused on
essential products.
—

Risk of supply chain distribution
disruptions due to the impact ofnatural disasters (floods, torrential
rains, water shortages and otherevents).

Enhance response
capabilities with business
continuity planning (BCP),
including decentralizedmaterials procurement
sources and production
bases.

¥(0.4)
billion/year

MediumRisk that air conditioning andcooling equipment operating costs
will increase due to a rise in averagetemperatures.

Promote the introductionof residential power
generation throughsustainable energy andother measures.

¥(5.7)
billion/5 years

Small

¥6.0
billion/year

Medium

¥6.0
billion/year

MediumPromote the expansion of
product lineups and salesof more efficient energysaving water heaters.
——

Target areas whereenvironmental regulations
have not yet tightened,
expanding the adoptionof products
corresponding to usage
environments in thoseareas.

* 2°C and 4°C scenarios
Scenarios used in the Fifth Assessment Report (released in 2014) of the Intergovernmental Panel on Climate Change (IPCC), which estimates the impacts of approximate 2°C and
4°C temperature increases due to global warming.

31

Rinnai Report 2022

32

Environment

Global Deployment of
Rinnai Group Water Heaters

Initiatives at Shanghai Rinnai (China)
In China, sales of gas water heaters and gas boilers with highenvironmental performance and convenience are increasing due
to the improved standard of living, which makes it easier for more
people to purchase convenient equipment, and an expanding
gas pipeline network to achieve a low-carbon society. Compared
to coal-fueled boilers and tank-type boilers that store water andboil water, gas water heaters are highly efficient and cancontribute to the environment. Shanghai Rinnai aims to reduce
environmental impact by promoting their widespread use.
As consumer behavior is changing in China, an increasing
percentage of water heaters are being purchased on line. While
expanding its internet sales channels, the company is also
leveraging Rinnai’s brand image of high quality and performance
to increase sales. In addition, in preparation for increased local
demand, the company plans to expand its production factory
located in Fengxian District of Shanghai, with the aim of
spreading the use of environmentally friendly products.

The Rinnai Group widely develops water heaters for use in Japan as well as overseas, engaging
in business deeply related to global warming and energy consumption. Viewed in another way,
the development and adoption of more highly efficient water heaters will enable the realizationof substantial reductions in adverse environmental impacts.

Source: Compiled by Rinnai from
US Air Conditioning,
Heating, and Refrigeration
Institute (AHRI) statistics(Thousands)
12,00012%

10,00010%

10.3%

Tank water heaters

8,000

8%

6,000

6%

4,000
2,000

4%

3.5%

Tankless water heater ratio

2%

Tankless water heaters0

Tankless water heaters ratio

Water heater shipmentsin the US market

Water heater shipments in the Unites States

Rinnai America Corporation Initiatives

0%2007 2008 2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Of the approximately 10 million units shipped annually in the US water
heater market, more than 90% are tank-type units with low thermal
efficiency. However, there is a gradual shift to tankless water heaters
with high thermal efficiency. Rinnai America is reducing the impact on
the global environment by promoting the widespread use of efficienttankless water heaters.

Image of factory expansion at Shanghai Rinnai

Global development of products that contribute to the environment
We aim to reduce environmental impact globally by deploying high-efficiency
water heaters, boilers, and solar systems not only in the US and China, butalso around the world.

United States
China

Tankless water heater

MexicoCommercial water heating system

BoilerAssembly line at Griffin FactorySouth Korea

Water heater(instantaneous, IoT)

Environmentally friendly boiler

United Kingdom

BrazilItaly

In April 2022, mass production of tankless water heaters began at Rinnai America’s
Griffin Factory. This will be the first Rinnai America plant to operate as a companyowned local production facility. Previously, Rinnai America operated from a leased
plant in the same city of Griffin and a warehouse in Peachtree City, but now the new
Griffin Factory has assembly and warehouse wings that consolidate the functionsof the other facilities. We will strive to further promote the use of tankless water
heaters by boosting local production capacity.
Scene from factory employee training

33

Tankless water heater

Tankless water heater

New ZealandAustralia

Tankless water heater

Tankless water heater

Solar system

Rinnai Report 2022

34

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 and Expectations
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; 1,133,492 GJ• Ground water: 234,501 m3

EnergyWater

EnergyWater

EnergyWater• Public water: 551,311 m3

CO2 Emissions (Emissions Ratio)

OUTPUT

883,457 t(8.93%)

Rinnai’s environmental impact—

Initiatives Rinnai conducts
through business

Solid waste(Includes valuable substances)

Wastewater

26,643 t 753,842 m³

Supply chain management

Pursuit of environmental
performance and streamliningof manufacturing processes

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

Rinnai’s estimates based on the “Basic Guidelines for Calculating Green House Emissions Through the Supply Chain”[Target scope] Development/manufacturing: Rinnai Corporation and consolidated subsidiaries
Procurement, sales/logistics/services, product usage/end of life treatment: Rinnai Corporation[Target period] Domestic: Fiscal 2022 (April 2021–End of March 2022)
Overseas: January 2021-End of December 2021
[CO2 emissions (units)]: t/CO2e, (%) represents the emissions ratio within each process.

35

35,941 t (0.36%)
Scope 2 67,987 t (0.69%)
Scope 1

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

8,953 t(0.09%)—
Spread of environmentallyfriendly products
Sales: Strive to spread products that
contribute to energy efficiency inthe water heater and heating fields
Logistics: We are promoting logisticalstreamlining.
Services: Elevate the Rinnai brand withsecurity activities through a wealthof service maintenance andinspections

Scope 3 (Category 11)

6,109 t8,846,480 t (89.39%)(Concerns emissions from Japanese water heaters)—(0.06%)—

Proposal of reasonably
achievable ecological lifestyles

Promotion of environmentallyconscious design

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 emphasize to allof our end users the environmental
performance of our products and how to usethem with the environment in mind.
The indicators marked □ have received third-party assurance by LRQA Limited.

Rinnai Report 2022

36

SocialLinks between Corporate Strategy and theRealization of a Sustainable Society (SDGs)

Contributing to the Global Environment by Enhancing the Energy Efficiency ofWater Heaters

Medium-term Business Plan 2021–2025 New ERA 2025 Targets
Under the Rinnai medium-term business plan New ERA 2025, which runs from fiscal 2022 to fiscal 2026, we aim to contribute to theresolution of social issues by reducing CO2 emitted during product use by seven million tons and increasing the sales ratio of productsthat contribute to improved quality of life and the global environment by 50% in 2025 (compared to 2020). Rinnai will make an effort toachieve the SDGs through products that contribute to improved quality of life and the global environment.
As the products Rinnai provides are directly linked to the SDGs, we believe that the ongoing spread and expansion of our
products will lead to the resolution of social issues. As an example, replacing water heaters with highly energy-efficient water heaters
reduces burdens on the global environment, creating a world in which gas clothes dryers, dishwashers and stoves with an automatic
cooking function are widely used, equalizing the role of housework and advancing the movement toward gender equality.
Contributing to a (Unit: 1,000 t)
reduction in CO2
emitted during
product use
4,500

2020

7,000
5,150

2021

Sales of products
contributing to improved
quality of life and theglobal environment

2025(Unit: billions of yen)

99.0

120.0

Power &
lighting, etc.
33%

80.0

2020

2021

2025

Cooling 3%

As the products Rinnai provides are directly linked to the SDGs, we
believe that the ongoing spread and expansion of our products will lead tothe resolution of social issues. As an example, replacing water heaters withhighly energy-efficient water heaters reduces burdens on the global
environment, creating a world in which gas clothes dryers, dishwashers andstoves with an automatic cooking function are widely used, equalizing therole of housework and advancing the movement toward gender equality.

Cooking 10%

ThemesContributions

Energy-efficiency

Higher energy-efficient water heaters contribute to the global environment

ResilienceGas-electric hybrids contribute to the securing of lifelines during emergencies

Micro Bubble Bath units

Health promotion

The hot bath effect from bathing in ultrafine air bubbles contributes to healthy lifestyles

Gas clothes dryers

Reduces time requiredfor houseworkPowerful gas drying shortens time spent doing laundry, contributes to reducing houseworkburdens

Reduced water usage

Conserves water when washing dishes, contributes to the conservation of water resources

Water Heater CO2 Emissions Comparison

Heating water
29%
Percentage ofhousehold energy
consumption by usage(FY2019)

Conventional water heaters

1,507(kg CO2/year)

High-efficiency water heaters

1,270(kg CO2/year)

Approx.

Heat pump-type water heaters

865(kg CO2/year)

Approx.

43% reduction

Hybrid water heaters

707(kg CO2/year)

Approx.

50% reduction(mode thermal efficiency 92.5%)(JIS 3.3)

Heating
25%(ECO ONE 160 L type)

15% reduction

Source: Energy White Paper 2021, Agency for
Natural Resources and Energy

Contributing to the Securing of Lifelines During Emergencies with
Gas-electric Hybrid Water Heaters

Products provided by Rinnai and their connection to the SDGs
Product names

In Japanese households, the combination of hot water and heating account for about 60% of energy consumption.
Further, when looking at the water heater product lifecycle, the largest amount of CO2 is emitted during the usage stage.
In water heaters with heating systems that provide both hot water and heat, Rinnai’s hybrid water heaters ingeniously
combine gas and electricity to provide hot water and heat. As a results, CO2 emissions are reduced to half that ofconventional water heaters, contributing to the conservation of the global environment.
By expanding the use of environment-friendly products, Rinnai aims to achieve a seven-million-ton reduction in CO2
by 2025.

Goals

As awareness of disasters increases year by year, seismic performance ratings and earthquake-resistant architecture
and construction methods are attracting greater attention than ever before. However, regardless of the degree to which ahome is earthquake-resistant, if electricity, gas, water and other lifelines are cut, life will be very inconvenient until services
are restored. As preparation for emergencies, the use of hybrid water heaters providing both gas and electricity disperserisks and facilitate the use of hot water, even when lifelines are limited.

Hybrid water heaters

Dishwashers

37

Electricity

Gas(High-efficiency
water heaters)

Reduces time requiredfor housework

Automated dishwashing contributes to reducing housework burdens

Stoves with automatic
cooking functions

Reduces time requiredfor housework

Automated cooking contributes to reducing housework burdens

Highly efficientand energy-saving

Powerful andspeedyBathroom heaters/dryers

Prevents heat shock

Bathroom heating eliminates temperature differences when bathing, contributes to the preventionof heat shock

It boosts the efficiency ofelectrical energy by using
hot air.

Gas tankless water heaters

Energy-efficiency

Enhancing the energy efficiency of water heaters contributes to the global environment

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

Gas boilers

Air pollution
countermeasures

Switching fuel from coal to gas in water heaters with heating systems contributes to the control of
air pollution(Heat pumps)

Hybrid water heaters

Rinnai Report 2022

38

SocialContributing to Healthy Lifestyles through the Hot Bath Effect from Bathing in
Ultrafine Air Bubbles

Contributing to Reductions in Housework Burdens with Powerful Gas Drying that
Shortens Time Spent Doing Laundry

The Micro Bubble Bath unit sprays ultrafine air bubbles (microbubbles) into the bathtub. Microbubbles permeate skin andpores to provide various benefits such as cleansing that removes dirt from the skin, the hot bath effect and relaxation.
Rinnai will enhance the merits of bathing and contribute to human health and spiritually rich lifestyles.

Gas clothes dryers use gas-heated air to dry clothing straightaway. This shortens time spent doing laundry and makes
bath towels soft and fluffy. It also provides the same level of sterilization as line drying in the sun. Powerful gas-drying
shortens the time required to perform daily housework, facilitating more relaxed lifestyles. Rinnai aims to achieve genderequality both in terms of housework burdens and lifestyle freedom.

What are microbubbles?

hot water into the bathtub), microbubbles are generated and produce a variety of health benefits for the bather.

In a questionnaire asking, “What are your concerns
regarding doing laundry during the rainy season?”
80% of households responded “difficult to dry.”
(%)

80

80.0%
63.5%

70

Husband

Effect and efficacy of microbubbles: Hot bath effect

Other

6.4%

0.3%

60
50
40
30

17.9%

20

Wife

93.3%

+1.6

0

+1.4
+1.2

10.8%

10

Awareness Survey on Laundry, Netsu to Kurashi Tsushin, May 2019; N = 534

Bad smell

Change over time in average skin temperature based on pre-bathing values

Difficult to dry

Change in averageskin temperature (˚C)

(˚C)

7.2%

0.2%
Other

In a questionnaire asking, “Who does the daily laundryin your house?” 93% of households responded “wife.”

None of the above

By affixing a microbubble bath unit between the bathtub and the water heater with dedicated circulator fittings (a device to spraydarkening

Microbubble bath unit

Causes yellowing or

milky cloud. As time passes, they float to the surface and become even finer bubbles as they contract in water.

Rinnai conducts surveys and analysis on various social issues, disseminating information
through the Netsu to Kurashi Tsushin (Heat & Life Newsletter).

Mold on clothing

Microbubbles are ultrafine bubbles measuring 1-100μm in diameter. They have low buoyance and spread out and gently rise like a

Awareness Survey on Laundry, Netsu to Kurashi Tsushin, May 2021; N = 1,000+1.0±0Prebathing

Start of rest
(Third minute ofbathing)

Rest for10 minutes

Rest for20 minutes
Microbubble bathing

Rest for30 minutes
Plain bathwater

Experiment parameters Research by Toho Gas Co., Ltd. and Nihon Fukushi University in fiscal 2019.
		
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˚CPowerful gas clothes dryers can dry an ample five kilograms oflaundry in approximately 52 minutes. Drying laundry in about
one-third the time required with electric dryers significantly
reduces time spent on housework.
Drying time comparison (laundry = 5 kg)

Gas clothes dryer

Fully automatic washer-dryer
with electric heat pump

Fully automatic washer-dryer
with electric heater

Approx.

Approx.

52 minutes

162 minutes
Approx.

281 minutes

Gas clothes dryer

Microbubble bath unit

39

Rinnai Report 2022

40

SocialContributing to the Conservation of Water Resources by Conserving Water
when Washing Dishes

Contributing to Reduced Housework Burden with Automated Cooking

Using a dishwasher to wash dishes uses approximately 80–90% of water used when washing by hand. The amount ofdetergent used is also reduced about 50–60%, contributing to resource conservation and reduced water pollution.

Stoves with automated cooking functions automatically prepare food when pre-prepped ingredients are added and amenu selection is made. In addition to reducing the time and effort required to cook, a full range of recipes reduces timespent worrying about menus. Even difficult recipes can be prepared deliciously in a short time by anyone, enabling users
to enjoy meals and family gatherings.

Water Used When Handwashing vs. Dishwashers
(ℓ)

120
100
80
60
40

103.2 ℓ12 ℓ61.5 ℓ200Dishwashers

Handwashing
30 items

Handwashing
56 items

Stove with automated cooking function

Waterless Cooking Pots Also Compatible with Automated Cooking and Recipe App

Contributing to Reduced Housework Burdens with Automated Dishwashers
Cleaning up is an inevitable part of everyday meals, and the larger a family, the more time and effort are required.
Dishwashers are an effective means of reducing time and effort, facilitating more free time spent with family. By
shortening the time required to perform daily housework and facilitating more relaxed lifestyles, Rinnai aims to achieve
gender equality both in terms of housework burdens and lifestyle freedoms.

Waterless cooking pots

In a questionnaire asking, “Choose the household chore
you dislike the most,” cleaning up after meals ranked insecond place.
(%)

30

In recent years, high-performance cooking pots compatible with anhydrous cooking and automatedcooking have been garnering attention amid increasing demands for easier and faster cooking methods. In
response, we developed proprietary waterless cooking pots compatible with Rinnai stoves equipped with anautomatic cooking function. These pots are made from aluminum, making them lightweight and easy to use,with durability comparable to conventional castiron pots.
We design cooking utensils and engage inproduct development and manufacturing
enabling anyone to easily prepare delicious foodevery day.

29%

25
20
15

19%
13%

12%

10

7%

5

1%

0
Cleaning Cleaning up Cooking Taking out
after meals
the trash

Laundry Shopping

Awareness Survey on Dual Incomes, Netsu to Kurashi Tsushin, May 2018; N = 100

41

Dishwasher

Rinnai Report 2022

42

SocialContributing to the Prevention of Heat Shock with Bathroom Heating that
Eliminates Temperature Differences when Bathing
The number of deaths from heat shock accidents whilebathing is increasing year by year. Heat shock is a lifethreatening phenomenon in which sudden temperaturechanges, such as occur when bathing during winter, placea heavy load on the heart and brain. The use of bathroom
heaters/dryers eliminates these temperature differences
when bathing, supporting a comfortable and safe lifestyle.

Intellectual Capital Supporting Rinnai Growth

Comparison of fatal traffic accidents andfatal heat shock accidents（Persons）

Approx. 19,000

20,0004 times
15,000or more10,000Intellectual Capital Key Data

5,000

4,373
0
Fatal traffic accidents

43.7%

56.3%

Fatal heat shock accidents

Source: Health, Labour and Welfare Science Research Grants Researchon Ascertaining Actual Conditions Regarding Bathing-related
Accidents and Preventive Measures Fiscal 2013 Integrated/Apportioned Research Report, Metropolitan Police Department“Traffic Accident Fatalities in Fiscal 2013”

At risk forheat shock

Based on the themes of heat and life and health and life, Rinnai R&D aims to provide society with safe, secure, healthy andcomfortable lifestyles. To this end, we are enhancing product safety and promoting the R&D of high added value
environmentally conscious heating equipment through the pursuit of energy and resource conservation, recycling andother efforts so that everyone can use Rinnai products centered on electronics, control technologies, combustion, fluid
control and sensor technologies with peace of mind, facilitating the proposal of healthy, comfortable lifestyles.

According to a Netsu to Kurashi Tsushin survey, about 60% of Japanese were
determined to be at risk for heat shock in a test that measures the degree ofrisk for heat shock.

FY2018FY2019FY2020

FY2021

FY2022

Number of patent applications

286

217

203

223

190

Number of registered patents

104

101

170

178

229

Number of patents held

2,374

2,328

2,300

2,358

2,406

R&D expenses (millions of yen)

9,918

9,503

9,308

11,802

12,762Rinnai Technologies Supporting Comfortable Lifestyles and Society
Preventing Fires with Sensor Technologies
Rinnai has been engaged for some time in the development of safety
sensors, establishing a track record of fire prevention activities throughRinnai Heat Shock Risk Confirmation Test conductedin December 2021; N = 2,350

sales promotion and promulgation efforts. Further, in South Korea,
mandatory safety sensor requirements similar to those in Japan haveBathroom heater/dryers warm the bathroom toprevent heat shock, while also functioning as a dryer inwinter when wet clothing is difficult to dry, capable ofdrying two kilograms of laundry in about 60 minutes.

Using the Mold Guard Mist function on bathroom
heaters/dryers once every two weeks can reduce thegrowth of mold in the bathroom by 99.9%. This
maintains cleanliness while reducing the burden ofbothersome bathtub cleaning, contributing to the
reduction of housework burdens.

been mandated since 2014, achieving similar results. Rinnai is promoting
efforts encouraging the adoption of these products to prevent residential
fire incidents, which have become a social challenge.
As living standards improve throughout theworld, and cookware is expected to increase in linewith demands for more abundant lifestyles, Rinnai willleverage technologies accumulated in developed
countries to provide products with a high degree ofsafety in order to meet growing demands.
Gas stoves with sensors (China)

Hydrogen Combustion Technologies Contributing to the Realization of
Carbon Neutrality
Rinnai successfully developed the world’s first 100% hydrogen combustion technology for residential
water heaters. Rinnai has spent many years developing gas appliances, accumulating combustion
and fluid control technologies facilitating the successful development of water heaters powered byhydrogen, which is sought after as a clean fuel source with zero CO2 emissions, eliminating problems
Bathroom heaters/dryers

43

associated with explosion risks and combustion stability.

Rinnai Report 2022

44

SocialHuman Capital

Increasing Employee Engagement

Industrial Relations and Human Rights

Rinnai began conducting an engagement survey in fiscal 2022 to visualize and continuously improve employee
engagement. The latest survey, targeting approximately 4,000 employees, had a response rate of 95%. From the survey
results, we identified large discrepancies in engagement between managers and non-managers, and a lack ofmechanisms encouraging employee growth, as Company-wide issues.

Establishment of Good Labor Relations

To raise the positive response rate 15 points byfiscal 2026, we will share issues with management andthe heads of each organization, take measures toaddress issues Company-wide and in eachorganization, and strengthen manager capabilities,
among a variety of other improvement measures.

Positive response rates in the employee
engagement survey

Targeting a

15-point increase by fiscal 2026

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 efforts to provide safe working environments, including concern for business partner
employees, in addition to our own. We also actively arrange and offer welfare programs and various events and programsfor our employees and their families.

Respect for Human Rights and Individuality

Health Management 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 Personnel
Affairs Division. The Personnel Affairs Division has
established dedicated departments (a health andwelfare team and a health support office) as part of
Rinnai’s three-pronged approach to supporting
employee health involving the health insurance union,
the employee union, and the Company.
In 2013, Rinnai established the Health Support
Office where fulltime public health nurses provide
individual health guidance and consultations as well as
information related to personal health, such ascountermeasures for preventing lifestyle-relateddiseases, and conduct health promotion seminars to
support mental and physical health.
Rinnai believes healthy employees are important to enable the continued support ofhealthy customer lifestyles, thus we conduct various measures to protect the health of
employees. As a result, Rinnai was selected as an Outstanding Health Management
Company 2022 (Large Enterprise Category), sponsored by the Ministry of Economy, Tradeand Industry, in recognition of our efforts to promote health as a company practicing
excellent health management.

45

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.” This information is also disclosed on the
Rinnai corporate website.
To promote and enforce the contents of the Rinnai Group “Code of Ethics” among all Group employees,a Compliance Committee member is allocated to each workplace and materials are published on the Company intranet.
At rank-specific training programs, we also educate our employees based on their roles and job responsibilities.

Efforts to Prevent Child Labor and Forced Labor
As a measure to prevent child labor and forced labor, the “Rinnai Code of Conduct: 4.2 Prohibition of Child Labor andForced Labor” stipulates that “We will not use any inappropriate labor including child labor that subjects persons under
the legal working age to harmful labor or any form of unjust labor contrary to the intent of workers.” The entire Groupabides 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.
We make a checklist available on the Company intranet providing specific examples of harassment, including sexual
harassment, power harassment, and harassment based on pregnancy, childbirth, childcare leave (maternal/paternal
leave harassment) and nursing care leave, enabling employees to self-diagnose their own behaviors. Further, Rinnai
provides newly assigned department managers with harassment education to reinforce its prevention.
In addition, as a preventive measure against maternal and paternal leave harassment, we have stipulated theprohibition of detrimental treatment in the rules of employment and internal regulations, which clearly state that
employees who violate this will be subject to disciplinary actions based on the rules of employment.

Rinnai Report 2022

46

SocialFair and Diversified Employment

Occupational Health and Safety

View toward Employment

Basic Policy on Safety and Hygiene

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.

Rinnai formulated the Basic Policy on Safety
and Hygiene to create workplaces where all
Rinnai employees can work with peace of mind,
as well as to maintain and promote health, withthe aim of reducing workplace accidents.

Supporting the Promotion and Active Participation of Women
As many Rinnai products are used in everyday life, we believe it
necessary that not only men, but also women occupy posts
facilitating both perspectives in planning and proposals. To increase
the ratio of female managers, which is one indicator of women’s
active participation, Rinnai must recruit and train women for careertrack positions. To this end, we are beginning to see the results ofefforts promoting the proactive hiring of female general employees,
the development of assistant manager-class female employees, andthe creation of comfortable working environments.
Although the current ratio of women in managerial positions is0.4%, Rinnai will conduct initiatives and confirm the results of efforts
focused on the recruitment and training of female generalemployees, raising this ratio to 1.5% by fiscal 2026 and 3.0% by
fiscal 2031.

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

Female employee ratio
(%)

8
7
6
5
4
3
2
1
0

Female employees ingeneral positions

5.5%

16

5.7%

5.0%
Female assistantmanager-class employees

2.0%

,

6.7%

6.3%

,

17

,

18

,

19

,

20

,

21

,

22

,

24

(Planned) (Planned)

Female manager target ratios
FY2022 actual

FY2026 actual

FY2031 target

0.4%

1.5%

3.0%

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.
Within safety and health activities conducted at each business site, to prevent disasters, activities include thehorizontal deployment of examples informing employees about work-related injuries and corresponding recurrence
prevention measures, establishing safety and health committees that include members from both labor andmanagement, conducting 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.

VOICE

Promotion of Traffic Safety

Daily Diligence Enabling Better System Development

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. Furthermore, through the periodic acquisition of driving
record certificates, we ascertain the status of employee safe driving behaviors and provide individual guidance assituations demand. Rinnai company vehicles are equipped with drive recorders, corner sensors and other safety
equipment, including safe driving eco-drive promotion systems (telematics), in an effort to promote employee traffic
safety and eco-friendliness from practical as well as theoretical perspectives.

The section where I work develops systems used in factories. I am mainly in charge ofsystems related to procurement and production.
While there is an air of tension surrounding some systems involved with production line
advances, the work is interesting and provides a sense of accomplishment when oursystems are used on actual production sites and to realize operational improvements.
Further, in terms of workstyle, I have been working from home as a pandemic
countermeasure, which provides me with a daily sense of fulfillment as this is a workstylethat suits me well. Going forward, I will maintain efforts to enhance my skills and diligently
development even better systems.

47

Basic Policy on Safety and Hygiene

Production Engineering Headquarters

Chihiro Akai

Rinnai Report 2022

48

GovernanceManagement Structure
Basic Principles

Audit System for Monitoring and Supervising Management

01

Rinnai views reinforcement and enhancement of corporate governance as important management priorities fromthe 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 andthat those rights can be exercised smoothly.

03

Rinnai views appropriate cooperation with all stakeholders as essential to improving corporate value and, throughits 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 of wide-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 to continually
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 tobuild relationships of trust with those stakeholders.

Corporate Governance Structure

Election and dismissal

Cooperation

Audit & Supervisory Board

Accounting Auditor

Cooperation

Election and dismissal

Audit

Consultation andrecommendation

Nomination/Compensation
Advisory Committee

Board of Directors

Election, dismissal,
and administration

President

ReportManagement

Internal
Audit

Related Committees

ReportReportAudit

Rinnai’s Board of Directors is comprised of seven members, two of whom are outside directors, and meets once a month inprinciple. 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 a quarterly basis. Moreover, theterm of Directors is fixed at one year in order to clarify management responsibilities and increase opportunities to enhanceshareholder confidence in the Board.

ReportExecutive Officers
ReportRinnai established a Nomination Advisory Board and a Compensation Advisory Board comprising a majority of outside
independent directors as advisory bodies to the Board of Directors to ensure a higher degree of objectivity and transparency inthe process of determining nominations and compensation for senior management and directors. Nominations andcompensation of directors and executive officers are discussed by the respective advisory committee, with a final decision
made by the Board of Directors.

Director Compensation

Election, dismissal,
and administration

Direction

Internal Control Office
Audit

Board of Directors

Nomination Advisory Board and Compensation Advisory Board
General Shareholders’ Meeting

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 ourdiverse 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 and executive
organization execution of duties, the development and operation of the internal control system, and the status of operations andproperty management at the head office and major offices. In addition to these duties, external account auditors audit theCompany’s accounts and verifies from a third-party perspective the legality of the internal control system as it relates tofinancial accounts.

Direction

Corporate Ethics Committee
Risk Management Committee
Environment Management
Committee
ESG Committee*1 and other

Cooperation

Business Divisions*1 In April 2022, Rinnai established the ESG Committee chaired by the President. The ESG Committee has functions as an organization that implements improvements in mattersrelated to the environment, society, and governance aimed at improving corporate value.

Compensation Amounts for Directors and Auditors
Compensation limits for directors and auditors are determined in(Fiscal 2022)
accordance with the resolution of the general meeting of
Total amount ofshareholders..
Category
Persons
compensation
paid*2Compensation for directors consists of a basic component
Directors
7¥284
million(fixed compensation) and a performance-linked component in a(of which are(2)(15)
outside directors)
ratio of approximately 70:30 for the purpose of providing a soundAuditors
4¥43 million
motivation for increased corporate value and target achievement.
(of which are(2)(11)
outside auditors)
Performance-linked compensation consists of an annual bonus,
Total
11¥327 million
designed to promote steady attainment of performance targets
every fiscal year, and a restricted stock compensation, designed to
Director salaries do not include employee salaries for directors who also serve
as employees. As of March 31, 2022, there were five directors (including two
seek steady improvement of corporate value through sharing
outside directors) and four auditors (including two outside auditors).
interests with shareholders by holding the Corporation’s shares forthe medium to long term. Compensation for auditors is determined through discussions among them.
*2 Excluding outside directors and directors who hold more than a certain number of shares

49

Rinnai Report 202250

Governance

Leadership (As of June 29, 2022)
Board of Directors
Kenji Hayashi

Skills Matrix of Directors

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

Hiroyasu Naito

Expertise and Experience
Jul. 1992	Managing Director, and General Manager of Related Business DivisionJun. 2005	Director, Managing Executive Officer, and General Manager of Related Business
Division
Jun. 2006 Representative Director, Vice Chairman of the Corporation
Apr. 2017 Representative Director, Chairman of the Board (current)

Representative Director and President and Executive President

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, andconcurrently 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)

Nobuyuki Matsui Outside director, Independent officer

Takashi Kamio

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)
Apr. 2021	President at International Professional University of Technology in Nagoya (current)

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. (currently, Toyota Fudosan 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. (currently, Toyota Fudosan Co., Ltd.)
Jun. 2011	
Audit & Supervisory Board Member at Central Nippon Expressway Company Limited
Jun. 2016 Outside director, Rinnai Corporation (current)

Outside director, Independent officer

Current Representation in Other Companies:
Chairman of Sasaeai, specified nonprofit corporation

Audit & Supervisory Board Members
Haruhiko Ishikawa

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)

Masaaki Matsuoka

51

Outside Independent Audit & Supervisory Board
MemberKinji Mori

Governance(G)/Legal
Matters

IT/Digital
Transformation(DX)

Chairman

Kenji Hayashi

●

●

●

−

●

●

●

−

President andExecutive President

Hiroyasu Naito

●

●

●

−

●

●

●

−

Representative Director andExecutive Vice President

Tsunenori Narita

●

●

●

●

−

●

−

−

Director (outside)

Nobuyuki Matsui

●

−

●

−

−

●

●

●

Director (outside)

Takashi Kamio

●

●

−

●

−

●

●

−

Reasons behind Selecting Eight-Point Skills Matrix
SkillsReasons behind Matrix Selection

Corporate management

It is vital for Rinnai, which seeks to address global social challenges through core technologies under the business themes of "heat and lifestyles"
and "health and lifestyles," to have directors who possess a wealth of knowledge in consumer services as well as management experience atmanufacturing companies, research facilities and other organizations.

Global management

Rinnai must have directors who possess overseas business management experience and a deep understanding of and involvement at the local
level, that is, the local lifestyle and culture and the environment, to support business expansion in global markets, particularly Japan, the UnitedStates and China, and to support sustainable growth.

Technology<Development/
Production/Environment>

Basic research into the use of all sorts of energy sources and component development as well as measures to maintain a highly reliable production
system are essential to an expanded lineup of products that contribute to "heat and lifestyles" and "health and lifestyles," and Rinnai must therefore
have directors with demonstrated knowledge and experience in development, production and the environment.

Business Plans/Marketing

Rinnai must have directors with demonstrated knowledge and experience in business planning and marketing to gather information on the realneeds of consumers and develop product planning and sales planning matched to these needs, and to reinforce business activities related to direct
sales.
Rinnai must have directors with demonstrated knowledge and experience in financial, accounting and capital policy disciplines for optimum

Finance/Accounting/Capital
allocation to strategic investments, return to shareholders and risk-responsive capital from the current added-value and profit-emphasis
Policymanagement perspective as well as a medium-term perspective.

Rinnai must have directors with demonstrated knowledge and experience in human resources development, workplace creation, health

Human Resources Strategy
management and diversity-oriented hiring to realize personnel system reform that encourages employees to challenge themselves and strive for(S)

personal fulfillment, and to present new workstyles and improve brand power.

Governance (G)/Legal Matters

Rinnai must have directors with demonstrated knowledge and experience in corporate governance, risk management and legal matters to maintainthe appropriate global governance structure and keep business activities going in fair and equitable workplace environment.

IT/Digital Transformation(DX)

Rinnai must have directors with demonstrated knowledge and experience in IT and DX, not only to promote digital transformation throughout the
Corporation but also to establish an information infrastructure to thwart cyberattacks and to utilize leading-edge information technologies.

Standing Audit & Supervisory Board Member

Career Summary and Current Position in the Corporation:
Apr. 1981 Joined Rinnai Corporation
Apr. 2010	Executive Officer, General Manager of Product Development Division, Research &Development Headquarters
Apr. 2011	Executive Officer, Deputy General Manager of Research & Development
Headquarters, General Manager of Product Development Division
Apr. 2016	Managing Executive Officer, General Manager of Research & Development
Headquarters
Apr. 2018	Managing Executive Officer, General Manager of Research & Development
Headquarters, General Manager of Technology Administration Division
Apr. 2019	Managing Executive Officer, General Manager of Quality Assurance Headquarters,
General Manager of Environment DivisionJun. 2022 Audit & Supervisory Board member (current)

Ippei Watanabe

Human
Resources
Strategy (S)* This table does not show all of the skills possessed by each Director.

Tsunenori Narita Representative Director and Executive Vice President, President’s assistantCurrent Representation in Other Companies: Outside director at Aichi Tokei Denki Co., Ltd.,
President at International Professional University of Technology in Nagoya

Corporate
management

Technology<Development/
Finance/
GlobalBusiness Plans/
Production/
Accounting/management
Marketing
Environment
Capital Policy(E)>

Executive Officers (excluding concurrent directors)
Hideyuki Shiraki

Chuji Nakashima

Kazuto Inoue

Hirohisa Ooi

Takuya Ogawa

Managing Executive Officer
General Manager of Marketing &Sales Headquarters and General
Manager of Sales Division

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

Managing Executive Officer
General Manager of Production
Engineering Headquarters

Senior Executive Officer
General Manager of Production
Headquarters

Senior Executive Officer
General Manager of Corporate
Planning Headquarters

Yoshihiko Takasu

Masanori Shimizu

Kenichi Ebata

Katsunori Tanioka

Hiroyuki Hoyano

Senior Executive Officer
General Manager of Overseas
Business Headquarters

Senior Executive Officer
General Manager of Quality
Assurance Headquarters

Senior Executive Officer
General Manager of President’s
Office, and General Manager ofGeneral Affairs Division

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

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

Atsuo Kashima

KazuhikoMatsumoto

Kenji Endo

Hayao Nishizawa

Outside Independent Audit & Supervisory Board Member

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)

Executive Officer
General Manager of Accounting
Division

Executive Officer
Presidents of Rinnai Precision Co., Ltd.

Executive Officer
Executive Officer
President of RB Controls Co., Ltd. and President of Shanghai Rinnai Co., Ltd.
President of Noto Tech Co., Ltd.

Rinnai Report 2022

52

Governance

Message from an Outside Director

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

Takashi Kamio
Outside Director, Independent Officer

My Views on Rinnai’s Initiatives and Business Performance
It has been two years since the pandemic began, and even now the world’s politics and economics are undergoing
dramatic changes, among the most prominent being Russia’s invasion of Ukraine.
Amid this situation, Rinnai experienced great difficulties in production and sales due to parts procurement
disruptions and cost increases. However, I think I saw Rinnai’s true mettle in overcoming obstacles, as sales in fiscal 2022
reached a record high.

Rinnai Group Code of Ethics(English, Chinese and Korean versions)

Risk Management

What I Find Good about Rinnai

Risk Management Policy

Rinnai’s fundamental concept is “Quality is our destiny,” and it is posted in key locations throughout the Company. I believethat this is the embodiment of its commitment to quality as a manufacturer. In addition, I feel that the tradition of “startingand ending with a bow” at Board of Directors’ meetings creates a sense of healthy intensity at such meetings and is how
the quality of discussions is enhanced.
While there is a feeling of intensity in the meetings, the President himself answers questions from Outside Directors
and Audit & Supervisory Board members with detailed explanations, which is impressive and creates an atmosphere thatallows free and vigorous discussions. In addition, there are planned briefing sessions on issues and initiatives in eachbusiness unit, as well as factory and facility tours, to ensure information sharing as a basis for discussion.

As society becomes increasingly complex, companies face a variety of risks. As a manufacturer of thermal energy
equipment that supports people’s daily lives, we believe it is our social responsibility to continue to provide products in astable manner. We are committed to risk management to live up to the trust of our customers and society and to conduct
stable business activities.

Issues Facing Rinnai
There are four steps in approaching risk management: 1) prediction and forecasting, 2) prevention and mitigation, 3)
response to incidents, and 4) prevention of recurrence. During the difficulties with procuring parts in that latter part of fiscal
2022, I think management took decisive actions in step 3) response to incidents and thereafter. I think the issues fromnow on are how to discuss 1) prediction and forecasting and 2) prevention and mitigation, and I would like to see the Risk
Management Committee emphasize this as part of its role.
Furthermore, as stated in the medium-term business plan, to achieve expansion of business scale, the planning
function for overseas strategies, marketing function, and overseas human resource development are indispensable asconditions for further corporate growth. I intend to continue to discuss these issues through Board of Directors’ meetingsand other settings.

53

The Rinnai Group has compiled behavioral standards that all executives andemployees 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 toGroup companies, and in countries where the official language is not English, themanual is translated into the local language of that country.

Promotion Structure
Rinnai’s Risk Management Committee is comprised mainly of executive
officers and divisional heads with the President serving as Chairman. The
Risk Management Committee identifies risks that may affect life, Rinnai’s
reputation, business activities, and assets, and prepares a List of Material
Risks, which evaluates the importance of each item in terms of magnitudeof impact and potential frequency of occurrence. The Committee also
determines which business divisions have a primary responsibility for eachtype of risk. These divisions discuss and work on developing mechanisms
to prevent risks from materializing, rapidly resolve crises, minimize any
damage that may occur as a result, and prevent recurrences.
The Committee works with all divisions and Group companies to mitigate
risks and enhance risk response capabilities.

Risk ofnon-compliance ormanagement inviolation of applicablelaws

Geopoliticalrisks

Risk of fire, explosion
accidents, andnatural disasters

Important Identified
Risks

Health risks such as
infectious diseases andmental health

Risk of suspension ordelays affecting raw
material procurement
activities

Risks related tothe environment

IT risks such as
cyber-attacks andinformation leaks

Rinnai Report 2022

54

Data Collection
Eleven-Year Financial Summary
FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

Net sales(Millions of yen)

246,636

251,832

286,981

295,022

319,935

330,256

347,071

348,022

340,460

344,364

366,185

Operating income(Millions of yen)

26,63426,35134,01830,787

34,59334,05632,84930,87934,422

40,69035,864

(%)

10.8%

10.5%

11.9%

10.4%

10.8%

10.3%

9.5%

8.9%

10.1%

11.8%

9.8%

Ordinary income(Millions of yen)

28,90729,06436,91032,93835,80735,28034,28633,31835,67942,40039,060Net income attributable to owners of theparent company(Millions of yen)

16,807

19,371

23,254

20,64722,71022,322

21,194

20,48021,561

27,581

23,748

Total net assets(Millions of yen)

154,737

178,007

232,635

261,414271,709290,638

307,965

320,696

340,959

371,318

378,856

Total assets(Millions of yen)

238,853

262,590334,382355,140

368,084

402,107422,422430,885

450,486

497,291

512,867

Net assets per share(Yen)

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

6,660.40

6,889.76

Net income per share(Yen)

342.60394.86454.74397.03436.71429.27410.41398.45419.49536.62

470.39Equity ratio

(%)

63.1%

65.7%

66.0%

69.4%

69.6%

67.8%

68.0%

69.4%

70.1%

68.8%

66.9%

Return on equity

(%)

11.7%

12.0%

11.8%

8.8%

9.0%

8.4%

7.6%

7.0%

7.0%

8.4%

6.9%

Cash flows from operating activities(Millions of yen)

23,07422,87236,45325,671

36,06639,55429,91429,47937,69449,491

28,696

Cash flows from investing activities(Millions of yen)

(16,222)(12,607)(32,908)(23,649)(17,770)(17,732)(12,190)(7,288)(7,124)(15,820)(25,486)

Cash flows from financing activities(Millions of yen)

(3,937)(5,002)

13,183(8,659)(6,554)(5,217)(11,725)(6,150)(6,436)(7,269)(27,109)

Cash and cash equivalents at end of year

(Millions of yen)

48,64855,03074,27969,34079,60095,297

101,697

116,133

140,138

166,524

147,972

Capital expenditures(Millions of yen)

9,378

8,222

12,43913,774

16,93820,664

16,105

13,481

10,58013,301

22,682

Research and development expenses(Millions of yen)

7,665

8,060

8,380

8,895

9,113

9,340

9,918

9,503

9,308

11,802

12,762

Operating income margin

Dividends

(Yen)

56

60

68

76

82

86

90

94

98

125

140

Payout ratio

(%)

16.3%

15.2%

15.0%

19.1%

18.8%

20.0%

21.9%

23.6%

23.4%

23.3%

29.8%

Number of outstanding shares(Shares)

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

51,616,463

50,021,057

Closing price at the end of the period

(Yen)

5,960

6,770

9,070

8,910

9,940

9,230

10,100

7,830

7,650

12,3909,170(Millions of yen)

323,130

367,045473,603465,249

519,032

481,958

521,326

404,157

394,866

639,528

458,693

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.

55

Rinnai Report 2022

56

Data Collection
Human Resource- and Personnel-Related Data

Environmental Data

Number of Employees (Non-consolidated)
Newly recruited employees

Mid-career recruitment
Mid-career recruitment ratio (%)
Temporary staff
Average working years

Average age (Years old)Male
FemaleSubtotal
Male
FemaleSubtotal
Subtotal
Subtotal
Male
FemaleSubtotal
Male
FemaleSubtotal

Fiscal 2020
62
22
84
2
6
8
9
189
17.3
13.3
16.1
39.7
34.5
38.2
Fiscal 2020

Paid leave
Employment of persons withdisabilities
Number of OJT accidents*Includes domestic consolidated subsidiaries

Maximum number of days added with paid leave
Average number of days taken with paid leave
Utilization ratio (%)
Number of persons with disabilities
Employment rate (%)
Number of accidents
Number of disasters(%)(LTIFR)

Number of employees on mental health leave
Number of employees who used childcare leave
Number of employees who took childcare leave of absence
Proportion of employees who return to work after taking
parental leave (%)
Number of employees who used shortened work hours

Number of employees who used family care leave

Number of employees who used nursing leave

Number of employees who took nursing leave of absence
Number of employees who used our reemployment (ComeBack) system
Number of employees who used the work from home
program

Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal
Male
FemaleSubtotal

Working Hours
Annual total actual working hours per employee (Hours)
Annual non-scheduled working hours per employee (Hours)
Average overtime per month (Hours)

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

57

Fiscal 2021
66
35
101
0
1
1
1
194
17.9
14.2
16.8
40.1
35.3
38.7

Fiscal 2022
71
13
84
7
1
8
9
178
18.7
15.3
17.7
41.0
36.3
39.6

20.0
12.1
58.0
74
2.23
37
0.23
21
57
0
123
123
—
100
100
0
131
131
1
48
49
1
4
5
1
4
5
1
2
3
59
14
73

Fiscal 2021
20.0
12.2
63.0
79
2.22
28
0.56
20
62
5
95
100
100
98
99
0
161
161
1
27
28
2
3
5
0
5
5
0
0
0
835
247
1,082

Fiscal 2022
20.0
14.0
70.1
82
2.33
26
0.00
31
63
7
123
130
100
97
99
4
199
203
2
38
40
3
2
5
0
1
1
0
0
0
512
210
722

Fiscal 2020
2,007.9
199.2
16.6

Fiscal 2021
1,952.0
176.7
14.7

Fiscal 2022
2,054.4
211.3
17.6

Fiscal 2020
6
0
14
1.0

Fiscal 2021
2
0
13
0.7

Fiscal 2022
10
0
27
0.7

Total energy used
(TJ)
1,200

1,107

Total amount ratio of the entire value chain(CO2 emissions) * 1
1,101

1,133

Scope 3 Category 1
Purchased goods / services

Eco-friendly products(contribute to reduction of CO2 emissions)(1,000 tCO2e)
8,000

880,000 t(8.93%)

7,000

1,000

5,950

6,000
800
600

5,150
4,510

Total of Scope 1, 2, 3
4,000

9,900,000 t

400
2,000
200
0

0
Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2021 Fiscal 2022

Scope 3 Category 11
Use of sold products

8,850,000 t (89.39%)

Water used

Solid waste(Weight of exterminating specified invasive species)(1,000 t)
40(1,000 m3)
1,000

30

Fiscal2026(Target)Biodiversity protection*2(includes valuable substances)

31

Fiscal2023(Target)

30

800

(kg)
400
808

758

360

786
300

27

230

600
20

200
400

10

0
Fiscal 2020

Fiscal 2021

0

Fiscal 2022

101

100

200

Fiscal 2020

Fiscal 2021

Fiscal 2022

0

Fiscal 2020

CO2 emissions reductions*3

Waste curtailment*3

Water saving*3(1,000 tCO2e)15(1,000 t)
1.0(1,000 m3)
40

Fiscal 2021

Fiscal 2022

31.8
30

10.8
10

6.0
5

21.9

0.5

0.5

20

17.0

0.3

3.5

10
0.1
0

0

0
Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2020

Fiscal 2021

Fiscal 2022

[Target scope] Rinnai Corporation and consolidated subsidiaries*1 [Target scope] Scope 1, 2: Rinnai Corporation and consolidated subsidiaries
Scope 3: Rinnai Corporation*2 In fiscal 2021 and fiscal 2022, due to efforts to prevent the spread of COVID-19, the area and the number of participants were limited and handled appropriately while paying due
attention to safety.
*3 Not an increase or decrease in the total amount, only the effect size evaluated by the improvement activities of each site is recorded.

Rinnai Report 2022

58

2022.10